Ecofys strikes alliance with The Generation Foundation

11 March 2016

The scientific consensus into the wide-ranging risks of dangerous climate warming, turned into an agreed-on policy framework at COP21, including the proposal of creating a carbon pricing mechanism. The Generation Foundation and Ecofys announce their partnership to research the complete value chain of a carbon pricing mechanism, in order to identify how best to leverage such a mechanism for long term sustainable human prosperity.

The Generation Foundation is a not-for-profit whose mission it is to create a long term, environmentally sustainable business framework. The organisation is focused on key climate change-related environmental issues, including climate change and environmental degradation, poverty and development, water & natural resource scarcity, pandemics & healthcare, and demographics, migration & urbanisation. The organisation is financially supported by Generation Investment Management, which was founded in 2004 by Al Gore and David Blood. The organisation operates out of London and New York, employs less than 10 people, and is focused on decoupling prosperity from resource-intensive growth.

During the COP21 conference in Paris, all parties unanimously agreed that action must be taken, although turning the global sentiment into local policies that are effective, and are implemented, remains an issue. The need for a global carbon pricing mechanism is seen by many world leaders and businesses as a mechanism for the global transition to a low carbon economy. While carbon pricing has been introduced within a number of jurisdictions, harmonisation of policies across different regions remains tenuous.

A further issue flagged by consulting firm Ecofys, is that many carbon schemes price carbon units too low, and thereby does not allow the mechanism to incentivise the investment necessary to decarbonise emissions-intensive value chains. The externality of carbon pollution, which the schemes seek to introduce into the value chain, are also not reaching the consumer level – further preventing a drive to a reduction in carbon-consuming consumption choices.

Generation Foundation

In a bid to explore the effect on how carbon pricing can facilitate sustainable global economic growth, The Generation Foundation and Ecofys recently announced a partnership for a research project into carbon pricing mechanisms. The aim of the project, which will take place over a period of three years, will see the organisations exploring the role of carbon pricing along value chains up to the end consumers. The project seeks to deliver a number of quantitative insights into how a carbon pricing mechanism can play a role in bringing about a climate warming scenario of 1.5°C.

Kornelis Blok, Director of Science of Ecofys and Professor at TU Delft, comments: “The proposed research aims to deliver actionable results and solutions for these challenges. With our innovative approach, we will take a comprehensive look at the issues, encompassing the policy, industry, investor and civil society perspective.”

David Blood, Senior Partner of Generation Investment Management, states: “Carbon remains a largely unpriced externality in today’s financial markets. Although it is impossible to know the exact timing of the prospective tipping point when financial markets will fully internalise carbon risk, it is critical for investors to prepare for its inevitable impact.”


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WEF finds no progress made on greening economy

01 April 2019

The reports of two influential bodies, in the space of a day, have warned that no progress is being made to prevent major climate change. The World Economic Forum has warned that greening of the global energy transition has stagnated over last five years, while the International Energy Agency has confirmed coal use rose again last year.

The position of the Academies of Science from 80 countries, plus a majority of scientific organisations that study climate science, is that humans are causing rapid climate change – often referred to as global warming. Roughly 95% of active climate researchers publishing climate papers endorse the consensus position that since the industrial revolution, the boom in carbon emissions from fossil fuel powered human activity has heavily impacted the planet, with rising levels of CO2 and other greenhouse gases trapping heat from the sun causing global temperatures to rise – something which will have catastrophic results in the near future.

Despite the steadfast consensus among the scientific community on the matter, however, there has been little to no meaningful action to avert disaster. In fact, while the signing of the Paris Accord was met with great excitement, since it came into force, global carbon dioxide emissions have continued to rise. Today, they sit at their highest levels yet, after a strong economy and extreme weather stoked a surge in energy demand last year.WEF finds no progress made on greening economyAccording to the world’s energy watchdog, the Paris-based International Energy Agency (IEA), energy spiked by 2.3% in 2018 – the biggest leap since 2010 – with that demand largely being met with fossil fuels. As a result, global emissions of carbon dioxide hit the record high of 33 billion tonnes in 2018, a rise of 1.7% on 2017’s figures. Commenting on the findings, IEA chief Fatih Birol said the rise in energy demand was “exceptional” and a “surprise for many.”

Birol added, “We have seen an extraordinary increase in global energy demand in 2018, growing at its fastest pace this decade. Looking at the global economy in 2019, it will be rather a surprise to see the same level of growth as 2018.”

The suggestion from Birol that 2018 is likely to be an anomaly which will not be seen again is strange, considering the added strain which the boom in emissions will place on the environment. To suggest that heightened energy demand was driven by extreme weather – which is increasingly difficult to claim is unrelated to man-made climate change – and then to suggest that such a thing is unlikely to occur any time soon in spite of emissions having increased seems contradictory.

Regardless of this, the bad news was further compounded within hours of the IEA’s release. A report from the World Economic Forum released on the same day concluded that the world's energy systems have not become any greener in the last five years. Despite the agreement of global climate targets, falling green power costs, and mounting public and business concern over the catastrophic impacts runaway climate change could wreak, the WEF’s damning assessment warned that little to no progress has been made on making energy systems more environmentally sustainable since 2014.

Coal is the largest hindrance of change on this front, according to the report. Recent years have seen improvements in energy access and security, but far too many nations remain dependent on coal power for the new energy systems to have made any environmental gains. At the same time, major economies have failed to decrease or even slow the amount of energy they use per unit of GDP, leaving smaller actors who have made changes micturating into a gale. Change on the part of the world’s largest economies is therefore crucial to driving the development of a greener, more efficient global economy, the WEF concluded.

Commenting on the findings, Roberto Bocca, leader of the WEF's future of energy and materials division, said urgent action is now needed to move toward decarbonisation. He added, "We need a future where energy is affordable, sustainable and accessible to all. Solid progress in bringing energy within the reach of more and more people is not enough to mask wider failures, which are already having an impact on our climate and on our societies."

The news comes even as sustainability continues to be talked about as a ‘top agenda item’ at the majority of the world’s largest corporations. While 85% say that it will be more important still in another five years, it is clear that the majority of the world’s most powerful businesses are failing to walk the talk on the matter, regardless of what governments do.