For investors, keeping note of these is important, as it gives insight into the way in which the winds of change are blowing.
Here’s a summary of some of the biggest news to come out of the conference thus far.
Cutting coal
Around 40 nations made a joint commitment to halt all of their investment in new coal power generation, both domestically and internationally. Major signatories including Canada, Poland, Ukraine and Vietnam agreed to end any reliance on coal by the 2030s or 2040s.
Additionally, more than 100 financial institutions and other organisations also agreed to stop financing coal development. Notably, the US, Australia, India and China did not sign up to the agreement.
While the agreement sounds positive, it attracted criticism from climate campaigners. Speaking to The Guardian, Friends of the Earth director of campaigns, Jamie Peters, said the announcement was “underwhelming” as it meant that coal would “continue as normal for years yet”.
Even so, the move is another knock for coal power plant owners and operators. Cutting investment on coal and other fossil fuel projects has been a major focus of the summit so far, leaving these businesses with limited sources of funding.
Fewer fossil fuels
More than 20 nations and financial institutions, including the US, UK and The European Investment Bank, said they will halt new financing for fossil fuel development overseas.
These funds will then be diverted to developing clean energy sources. This is expected to generate around $8bn a year for clean energy investment around the world.
Oil Change International programme director, Collin Rees, said: “This is a massive step forward. This represents a serious chunk of the current international public finance for fossil fuels. It’s a really big thing, though there may be some devil in the detail.”
While this new commitment could be a boon to green energy firms, fossil fuel projects may have a harder time attracting funding for new ventures.
Green tech acceleration
More than 40 world leaders pledged to work together on green technology. Big players in the group include the US, China, India, the EU and the UK. The nations plan to coordinate their standards and investments in order to speed the development and production of affordable clean technologies.
The commitment, dubbed the Glasgow Breakthrough Agenda, will target some of the most polluting sectors. The first five of these in the group’s crosshairs are power, road transport, hydrogen, steel and agriculture.
Progress of the initiative will be reported on every year in each sector, starting in 2022. This will be supported by annual reports led by the International Energy Agency in collaboration with International Renewable Energy Agency and UN High Level Champions.
Methane management
More than 90 countries signed a US- and EU-led agreement to cut global methane emissions by 30%. However, major polluters China, India and Russia did not put their names to the agreement.
President Biden said his plans in the US will see efforts to reduce the methane released by the country’s oil and gas industry. Leaks in pipelines are seen as a key issue here and the US Environmental Protection Agency could soon legally require operators to fix these leaks.
As such, pipeline companies like Enbridge (TSE: ENB), TC Pipelines (TSE: TRP) and Kinder Morgan (NYSE: KMI) may face higher costs. These will also likely be passed on to producers.
Deforestation situation
More than 100 world leaders have agreed to end deforestation by 2030. An agreement was reached by the parties on Monday but signing of the commitment took place on Tuesday.
Signatories include US President Joe Biden, China’s Xi Jinping and Brazilian President Jair Bolsonaro.
This is a fascinating development which will have long term effects for many different companies. A list of companies responsible for deforestation released by Earth.org illustrates this perfectly. The list names the likes of Walmart (NYSE: WMT), McDonald’s (NYSE: MCD) and Yum! Brands (NYSE: YUM) as among those most responsible for the destruction of forests.
New deforestation targets may force many businesses like these to adapt to a changing world or fall by the wayside.