On the heels of President Obama’s controversial decision to greenlight renewed oil drilling in the Arctic, the United Nations’ top climate change official yesterday declared that fossil fuels have become an unwise investment.
Christiana Figueres, who leads the U.N. Framework Convention on Climate Change, avoided commenting directly on the White House move allowing Royal Dutch Shell to begin exploratory drilling in the Chukchi Sea. But she noted that oil and gas reserves must stay underground and give way to renewable energy in order to achieve net-zero emissions by 2100.
"We have absolutely no opinion about what governments do with companies that operate within their geographic boundaries," she said. "But there is an increasing amount of analysis that points to the fact that we will have to keep the great majority of fossil fuels underground."
Figueres argued that a financial risk also lies ahead for those who invest in dirty fuels or bank on the hope that oil prices will climb back past $100 per barrel.
"It is very evident that climate policy is advancing and progressing, so one wonders whether that kind of investment is prudent and actually within the fiduciary duty of investors," she said.
Speaking to reporters in an online roundtable, Figueres also outlined the steps the United Nations and 193 countries are taking as they work to develop a new international climate accord. The deal is expected to be signed in Paris in December, and will for the first time include commitments to curb greenhouse gas emissions from rich and poor nations alike.
The agreement is expected to go into effect by 2020 and will include carbon-cutting targets from countries going out to 2025 or 2030.
3-part agreement, but no ‘silver bullet’
Figueres described the deal shaping up for Paris as "a long-term framework that supports the process of decoupling greenhouse gas emissions from global growth," rather than a "silver bullet" moment in the fight against climate change. Figueres also argued that the agreement needs to support poorer countries and help them achieve economic growth while cutting carbon — or, as she put it, it needs to be "protective of growth and development rather than threatening to growth and development."
"They still see an increase in their growth and their development as being absolutely fundamental to their future," Figueres said.
She also outlined the shape that the Paris agreement will likely take, which will be three separate documents. The main agreement, she said, will be the legal text of the accord. The second will be a decision under the U.N. Convention of the Parties (COP) that includes the "operative details." For example, Figueres noted, diplomats may agree to periodically review countries’ progress toward meeting their emissions goals — something that would be in the main document. The details of how that review would operate, though, would be in the supporting COP decision.
Finally, she said, negotiators are aiming to put out a third section of the agreement that pulls together work that is being done by states, cities, businesses and other "non-state" actors to curb emissions before the end of the decade "in full recognition that we cannot wait for 2020 to take action."
Negotiators will meet the first two weeks of June for a midyear negotiating session. Figueres said she hopes by the end of that meeting to "have a pretty good idea" of what elements will go in each section of the agreement.