Stockholm (NordSIP) – According to Schroders, the current pace of global warming dropped to 3.6°C above pre-industrial levels as of the end of the first quarter of 2021. This is the lowest reading since Schroders Climate Progress Dashboard was launched in 2017, down from the 3.7°C rise recorded last quarter.
“We are looking forward to the rest of 2021 and the months leading up to COP26 with optimism. Policymakers in most major economies have now spelled out their commitment to action, setting the scene for co-ordinated global action that could underpin the sustained greenhouse gas emission reductions that will be needed to put the global economy on track for decarbonisation,” Andy Howard, Schroders Global Head of Sustainable Investments, commented.
Launched in 2017, the Climate Progress Dashboard provides Schroders with an estimate of the progress that governments and industries across the world are making towards meeting the commitments made in the Paris Agreement in 2015.
“We have already seen governments representing around 70% of global emissions or GDP commit to fully decarbonising their economies. The number of companies making similar Paris-aligned commitments through the Science Based Targets initiative has grown by around 50% over the last year and corporate focus on target setting continues to gather pace,” Howard adds.
Schroders highlighted the role of the EU Emissions Trading System (ETS) market, as well as the smaller US Regional Greenhouse Gas Initiative auctions, continue to rise, as a cornerstone of the combat against climate change. According to the London-based asset manager, prices on the EU ETS have reached new highs of more than €40 per tonne of CO2 in recent weeks. However, despite these developments and decreases in oil and gas investment, fossil fuel production remains the single largest contributor to global warming according to the Climate Progress Dashboard.
“We believe higher carbon prices will be needed – across a larger share of emissions –to drive change on the scale and breadth necessary to meet climate goals. The sustained rise in prices over recent years, despite plummeting industrial output, has demonstrated the resilience of the trend and the benefits of political action,” Howard concludes.
Photo courtesy of Schroders