Remarks by Senior Advisor Brian Deese - As Prepared for Delivery

“The Paris Agreement and Beyond”
Reed College
April 15, 2016

As Prepared for Delivery-

Last December, after countless sleepless nights in a refashioned airplane hanger in Le Bourget, Paris, I remember running through an airport past a blur of headlines characterizing the Paris Agreement as either historic and unprecedented or insufficient and inconclusive. In the months since, I have been pressed to defend the Agreement against these seemingly contradictory conclusions.

Today, I’d like to argue that both descriptions are accurate. The Paris Agreement is, at the same time, humanity’s best chance to save the one planet we have and, on its own, wholly insufficient to solve the climate threat. If this is right, I would like to make the case about what should matter most for international climate policy in the years ahead.

Before that, a few words on the Paris Agreement itself. “Paris” is an agreement adopted by all 195 countries that are parties to the United Nations Convention on Climate Change or the UNFCCC. It directs nations to set their own climate policies and targets, known as intended nationally determined contributions or INDCs for the post-2020 period. The Agreement legally obligates countries to provide emissions inventories; to update their national plans every five years; to report regularly on progress toward those plans; and to subject those reports to independent review. Finally, the Agreement affirms the need for increasing resource flow to developing countries for low-carbon development and climate adaptation.

The Case for an Historic Agreement

So what makes that so historic? At least three things:

UniversalityFirst, the Paris Agreement reflects a universal commitment by all countries to put forward increasingly ambitious targets. For students of climate diplomacy, this is what Vice President Biden would call a big deal. From Rio in 1992 to Kyoto in 1997 and for the following decade, the dominant theory of international climate diplomacy was not universality, but bifurcation –countries put in the “developed” category were required to enact major emissions reductions; countries on the “developing” list were largely off-the-hook in response to what some saw as a far off environmental problem.

That model persisted even as the severity of the problem grew and the global economy transformed. But by 2009, it proved fundamentally unworkable. Politically, it was unsaleable to treat China the same as Chad, or Korea (a country with higher GDP per capita than Italy) the same as Kiribati. Mathematically, it was untenable to solve the problem when the largest developed countries account for less than a third of global emissions. Even if the United States, EU and Japan went carbon neutral overnight, developing countries accounting for more than two thirds of global emissions would remain outside of a solution. 

But in 2009 in Copenhagen, at a meeting that was otherwise regarded as a failure, the seeds of a new answer were sown. After decades of trial and error, we were happening on a new approach. We wouldn’t abandon the core concept of common but differentiated responsibilities – that poorer countries shouldn’t have the same obligations as wealthier nations. But for the first time, every country would set climate targets based on national capabilities, not dictated or mandated from above. In Paris, all countries legally bound themselves to update those targets, and pledged to make them stronger over time.

Some countries’ initial INDCs were ambitious; others were more conservative. But all countries bought into the idea that universal action was required. All countries committed to a global system to increase ambition together. And that is historic.

Decoupling economic growth and emissions

Second, the Paris Agreement reflects our best shot to move beyond the long accepted economic principle of a zero sum trade-off between economic growth and protecting the planet. 

For decades, GDP growth and carbon pollution from the energy sector rose in tandem. Countries accepted, and negotiations presumed, that to restrict the latter meant sacrificing some of the former. But recently, something important has happened. Over the past two years for which data is available, the global economy grew by 6.7 percent, while energy sector emissions have stayed flat.

That is the first time outside of a global downturn when global economic growth has decoupled from emissions growth.

In the United States, from 2010 to 2014, GDP grew by 11 percent, while energy sector emissions fell by 3 percent.  A recent WRI study found that this dynamic is present in more than 20 countries, including some like Bulgaria and Uzbekistan whose industrial sectors are still expanding as a share of their economies. Other studies have even suggested that China – whose economy grew at 6.9% in 2015 – may be close to peaking its emissions.

Of course, in a country like India, where 300 million citizens currently lack access to electricity, alleviating poverty must continue to be the top priority. But the idea that meeting development imperatives require unconstrained emissions growth is also being disproven. Indeed, as Prime Minister Modi has argued passionately, it is the world’s poorest and most vulnerable populations that will be the most adversely affected by climate change. And it is those governments that will bear disproportionate costs. That is why India is seeking to drive massive solar deployment in its power sector, which holds out the prospect of shifting them toward a low-carbon growth path as well.

To be clear, the Paris Agreement is not solely responsible for this decoupling. But consider this: a group of MIT economists recently aggregated the national commitments under the Paris Agreement and found that fulfilling them will require an additional 2,000 GW of renewable electricity capacity by 2030. That scale, they found, would drive a 50% reduction in the cost of solar and a 25% decrease in the cost of wind – making renewables globally cheaper than both coal and natural gas by 2030. That moment is within our sights because of the Paris Agreement. And that is historic.

From climate laggards to climate leaders

This leads me to a third point: Paris reflects the world’s largest economies and emitters moving from climate laggards to climate leaders.

In 2009, in the ashes of Copenhagen, President Obama was determined to reposition the United States as a leader on climate change. This meant, first, leading by example. The Clean Power Plan, fuel economy standards for cars and trucks, phasing down super-pollutants like hydrofluorocarbons, and building and appliance standards – all showed the world that the United States could hit ambitious emissions reductions goals.

But President Obama also recognized that to create an environment for a new global consensus, we would need to forge new bilateral partnerships. President Obama stood with Prime Minister Modi in New Delhi to announce India’s ambitious solar targets. He negotiated joint clean energy action with President Pena Nieto of Mexico. He announced new renewable energy goals with Brazil. He met with leaders from African nations, small island states, the Middle East and everywhere in between to reinforce his commitment and encourage others to climate action.

And, as many of you know, in late 2014 President Obama stood with President Xi in Beijing and surprised the world. China and the United States are the two largest economies, energy consumers and carbon emitters in the world. Ours is a complex relationship on a range of issues – and on climate change, we were for decades cast as captains of opposing teams.

But over years, dogged and sustained diplomacy led to our two countries working behind the scenes to better understand what more each country could do to reduce emissions. Together we encouraged and reinforced each other. That led to the joint announcement of ambitious climate targets that year, and a joint announcement of ambitious implementation efforts and a vision for Paris the next.

This partnership – and deepened cooperation with leaders from major economies – was not just helpful to getting the Paris Agreement over the finish line. Rather, it is the beginning of a new global coalition on climate change. And that is truly historic.

The Insufficient and Uncertain Paris Agreement

A universal agreement; that holds out the prospect of decoupling economic growth and emissions; and that embodies a new coalition for global climate leadership. That all sounds pretty good. But it is not the whole story.  

For years, climate scientists have trained their sights on limiting global temperature increases to 2 degrees Celsius beyond preindustrial levels by the end of the century. But even at 2 degrees, crop yields in the United States, India, Africa, and elsewhere could decrease by as much as 30%; the share of the American west impacted by wildfire could grow by up to 8 times; and Arctic sea ice coverage could decrease by up to 50%. So that is why the Paris Agreement itself calls on countries to make best efforts to limit warming to 1.5 degrees.

But how much progress does the Paris Agreement alone make against remaining well below the 2 degree benchmark? Not nearly enough.

According to a recent study in Science, without the Paris Agreement, there is virtually no chance of limiting warming to below 2 degrees, and a more than a 50% chance that warming increases by 4 degrees or more.

Assuming the Paris INDCs are implemented and continue through the end of the century, the same study finds an 8% chance of limiting warming to 2 degrees. In fairness, the tail risk in this scenario – that warming increases by 4 degrees or more – is virtually eliminated, which is significant. But the idea of leaving my two children, or their children, a 92% chance of experiencing the most severe impacts of climate change is not comforting.

But, the Agreement does direct countries to set increasingly ambitious INDCs every five years. Assuming countries do, the Science study estimates a 30% chance of limiting warming to below 2 degrees. And if renewable energy costs drop dramatically and if deployment increases rapidly, if technological innovation accelerates, and if forests and other carbon sinks continue to mitigate emissions, the probability of limiting warming to below 2 degrees rises to about 50%.

Priorities for the Future

Now, I’ll be the first to acknowledge that there are lot of “ifs” in that statement. And I hope that in using them, I have given you a concrete reason for both optimism and uncertainty. So what do we do with those conflicting impulses? What is most important in the post-Paris era?

Here, I want to focus on three specific goals.

Making the mechanics of the Agreement even more concrete

First, if Paris is a calculated bet that a universal, bottom-up process can generate more ambition over time, then we all should sweat the specifics of that process. If the system is to drive reforms, then the particulars of what, when and how countries will engage in things like inventories, reporting and review, or how carbon markets will develop, take on outsized importance. Let me give you one, initial and timely example.

While the formal Paris implementation period is 2020-2030, the Paris Agreement itself could go into effect far sooner than that. There is a little noticed provision in the Agreement that says: as soon as 55 countries representing at least 55% of global emissions formally join, the Agreement will enter into force. If Paris enters into force early, it would have a catalytic effect, allowing resolution of key negotiating issues sooner, encouraging swifter implementation of domestic reforms. The machine turns more quickly.

That’s why, just two weeks ago, Presidents Obama and Xi and announced that the United States and China would join the Agreement as soon as possible this year, in 2016. The United States and China represent about 38% of global emissions. Last week, Brazil, South Africa, India and China – the so called BASICs – committed to “facilitate the timely entry into force of the Agreement, and urged other countries to do so as well.” Already – before the Agreement even opens for signature and ratification next week – we are within striking distance of having the Agreement start years earlier than anyone anticipated.

If you’re invested in addressing insufficiency and increasing certainty, this is an opportunity to make progress well before anyone expected.

Locking in even more climate ambition now

Second, you should weigh heavily any domestic action to lock in greater ambition now instead of later. By 2020 many countries, including the United States, will be required to put out new INDCs for the 2025-2030 timeframe. Before that happens, all countries, based on a global stock take of emissions in 2018, need to do what they can to meet or exceed their 2020 targets. If they do, the 2030 targets will by definition become more ambitious.

We’re making progress on this front. In December, in the days after he returned from Paris, President Obama worked with Congress to secure a long term extension of tax incentives for renewable energy, such as wind and solar. These incentives, which were not assumed or baked into our INDC, will drive an additional 100 GW of new wind and solar capacity over the next five years – doubling our base of these renewables and cutting carbon emissions by an additional 2 percent by 2020. In January, President Obama announced that the Department of Interior would pause new federal coal leases and launch a fundamental review of the federal coal program, which accounts for 40 percent of the United States coal supply.

Beyond our borders, 2015 was the first year in history when renewables represented a majority of new global generation capacity. This includes major increases in China, the Middle East and Africa. And just one specific example: following the Paris Agreement, Mexico passed a national clean energy standard that will require 35% of the country’s generation to come from clean energy by 2024 – up from 18% today.

This kind of early progress boosts baselines. If this happens in the five years before the formal Paris implementation period, we’ll have a better launching pad from which to meet the climate challenge.

Making the Paris Agreement’s market signal an enduring and irreversible force

And third, you should care about the durability of the long-term market signal toward low-carbon development. Before I flew to Paris, a prominent journalist suggested to me that, irrespective of the details, just getting an Agreement would be the most powerful clean energy investment driver in history.

As you have probably figured out, I tend to sweat the details. But in this instance, the point is important. For me, one of the most striking things about the last year was the American private sector’s near unanimous view that a long term, international climate framework was in their business interest. The coalition in Paris was much more than nation states. It was Wal-Mart, Google and Amazon. It was Alcoa, Ford and DuPont. It was Jack Ma and John Doerr, Ratan Tata and Richard Branson. It was Tom Steyer and Meg Whitman – a combination that all of you here on the West Coast should appreciate.

We need to do even more to make that market signal an enduring and irreversible force. One of the ways to solidify the new economic reality of clean energy is to work with the private sector to provide more certainty about what the clean energy future could look like and where the investment opportunities could be. Luckily, another seemingly bureaucratic clause of the Paris Agreement invites countries to do just that. See, I’m back to sweating the details. The clause asks countries to lay out what they need to do to significantly cut emissions by the middle of the century. 

Now, given the uncertainty of projecting 30 or 40 years into the future, this exercise is inherently speculative and will not prescribe and project the specific policies that the United States and others must enact. It is not an INDC. Rather, it can define the key pathways for action and provide a roadmap for investment opportunities in deployment, research and development, and technological innovation – all of which can reinforce the existing market signal.

That’s why last month, President Obama and Prime Minister Trudeau announced that both countries will complete this exercise this year. This detail didn’t get a lot of attention – particularly with all the hoopla surrounding the visit to Washington of Canada’s most famous Justin. But if more countries follow suit and take this exercise seriously, it will be a big deal. 

It will be an opportunity for countries to improve their models, and focus on areas where we all need to up our games. For the United States, this will mean among other things, a more comprehensive approach to our land sector. With each ton of emissions we reduce, the remaining reductions get harder and costlier to achieve. So our forests, wetlands, and grasslands’ role as “carbon sinks” should become an even more important part of our strategy to get to deeper decarbonization and stay below 2 degrees. We’ll need tools to help our carbon sinks remove more emissions from the atmosphere, including by enhancing our ability to measure, monitor and verify them.‎

As we give the private sector a clearer vision of a decarbonized economy and a more certain sense of the major investment opportunities, there will more willingness to take risks and invest in clean energy. And if you care about putting ourselves in the best position to limit warming to 2 degrees, that is one of the most important things we can do.

Conclusion

At this point, I hope I’ve left you sufficiently motivated but a little scared too. Motivated because the world came together last year around an historic Agreement that is universal, reflects progress in decoupling economic growth and emissions, and gave us a new global coalition for climate action. Scared because the Agreement on its own is insufficient and because the future of the climate is quite uncertain. But motivated again because we are faced with opportunities – many of which come from the Agreement itself – to make the mechanics of the Agreement more concrete, increase domestic ambition now instead of later, and move closer to a durable market signal for clean energy. Together, these steps could significantly improve our chances of fighting off the most dire impacts of climate change.

Last December, in Paris when the Agreement was gaveled through, I saw an incredible sense of hope in an auditorium filled with hundreds of climate diplomats – not always the most hopeful crowd. It was a moment to be celebrated but more importantly a foundation to build on. Whether the Paris Agreement ultimately lives up to the hope in that auditorium depends on what we do in the months and years ahead. But I’ll leave you with the note President Obama wrote on a copy of the Agreement he signed for the American negotiating team. “You’ve given future generations a fighting chance,” he wrote. I agree. And that is why I’m more motivated than ever to keep waging the fight.