Climate Neutrality Forum
Identifying Sensitive Interventions for the Post Carbon Transition
Autumn 2021
Berlin, Milan, Oxford and Online
sensitive intervention points for achieving carbon neutrality: report for the climate neutrality forum
On 8 and 9 September 2021, the first Climate Neutrality Forum (CNF) brought together over 1,000 academics and climate policy experts in a multi-hub hybrid meeting held in Berlin, Oxford and Milan. This was followed by six weekly webinars held in the lead up to COP26.
The forum explored challenges and key policy interventions for achieving climate neutrality. The CNF was informed by the work of the Intergovernmental Panel on Climate Change (IPCC) during its 6th Assessment Cycle, in particular the IPCC Special Report on Warming of 1.5 C (SR1.5) and the IPCC Working Group I report on Scientific Understanding of Climate Change, published in August 2021.
Climate neutrality is considered to mean a cessation of further warming of the Earth’s climate system by atmospheric greenhouse gases. It is aligned with, and informed by, the Paris Agreement temperature goal to hold “the increase in the global average temperature to well below 2°C above pre-industrial levels and pursuing efforts to limit the temperature increase to 1.5°C.”
The forum sought Sensitive Intervention Points for achieving climate neutrality, which are solutions that transform a system or take advantage of amplification dynamics in part of the system that is at or near a tipping point or state of ‘criticality’ (Hepburn et al., 2020).
These were evaluated on:
TIMING
To halve emissions by 2030, and again by 2040, or accelerate removals in time for 2050
IMPACT
To reduce GHG emissions by 1Gt by 2030 or 2040, or scale GGR for 2050
PRACTICALITY
Politically, technologically and economically
RISK
The unintended consequences and trade-offs
RECOMMENDATIONS FOR POLICYMAKERS
FOR EQUITY AND A JUST TRANSITION
Climate neutral strategies should explicitly outline their impacts on a wide range of stakeholder groups to explain how policies will address each form of equity outlined in this report. More investment is needed to close gaps in international climate finance, with new revenues for adaptation. Revenue raising mechanisms such as Carbon Border Adjustment Mechanisms should include funds for international climate finance. Debt restructuring is needed as developing countries weather climate catastrophe, increasing financial stress.
FOR RAPID EMISSIONS REDUCTIONS
Climate neutral strategies should implement policy instruments that allow society to capitalize on the under-estimated savings potential of clean energy technology with declining cost-serves as well as higher carbon pricing paired with ambitious Carbon Border Adjustment Mechanisms to avoid carbon leakage.
FOR FINAL 20% HARD TO ABATE SECTORS
Climate neutrality demands more than a shift to low-carbon road transport and renewable electricity generation. This will require public investment and policies to de-risk investment in zero carbon and carbon neutral fuel alternatives and infrastructure, e.g. Contracts for Differences (CfDs). Experts warned that technology-neutral policies which fail to pick between, for example, green and blue hydrogen, may and waste public resources and delay the transition, and over-reliance on blue-hydrogen may lead to carbon lock-in.
FOR NATURE LANDUSE AND AGRICULTURE
Climate neutrality demands radical agricultural subsidy reform. The global cost per year of the damage to nature from harmful subsidies is estimated between $4 to $6 trillion (The Dasgupta Review, 2021). Subsidy reforms are likely to fall flat on delivering the scale of change required if policies are not ambitious (Meadows, 1999; Searchinger et al., 2020). The impact of increasing soil carbon sequestration in the world’s arable soils is estimated at on average 5 billion tonnes CO2e per year (Dunne, 2020), requiring investment to scale Monitoring Reporting and Verification. Nature-based Solutions must embed local support measures to ensure integrity.
FOR GREENOUSE GAS REMOVAL
Standardisation and regulation is a key priority. Climate neutral strategies must policies for scaling greenhouse gas removal, which will be needed to the order of 100 billion to 1 trillion tonnes by mid century (SR 1.5). These may include incentives and public financing national Feed-In-Tariffs and a European Removal fund supported by the ETS. Policies are also needed requiring heavy industry to either capture carbon emissions or stop emitting, such as a carbon market with a cap or a Carbon Take Back Obligation.
FOR CLIMATE FINANCE AND POLICY
A range of interventions are needed to achieve climate neutrality, green supportive factors, such as “green loan guarantees” and “targeted public private partnerships” to scale decarbonization solutions, as well as “dirty penalizing factors” such as “capital adjustment” (an extension of Basel rules), and “risk adjustments”. Experts emphasized that financial institutions must move beyond an era of transparency and climate-risk management and focus more on climate outcomes.
We are grateful for support from JPI-Climate and the ClimateWorks Foundation which has made these meetings and report possible.
Contact us at: netzero@ouce.ox.ac.uk