It’s not only the climate that can take heart from the agreement reached during the early hours of Saturday morning in Cancun, Mexico. The significant and wide ranging set of decisions made at the United Nations annual climate conference will also be music to the ears of those businesses preparing to invest billions of pounds in the new global green economy.
Although the agreement, all 34 pages of it, covers progress on a wide range of measures, from rainforest protection to global technology hubs, the whole adds up to considerably more than the sum of its parts. The most important aspect of the Cancun Agreement is that it sends a very clear and positive message. After the disappointment of Copenhagen and much negative news for the climate agenda, the world is now firmly back on track towards a new global low carbon economy.
I don’t doubt that there is a lot more work to do and we need to collectively raise our game at Durban but the momentum that Cancun has reinserted into the whole climate movement is unmistakeable. So, for me, there were four important outcomes for business from Cancun.
Firstly, and above all, a global deal is now on course to be completed. The agreement recognises that all major economies will need to take ambitious action - including the US and China - though the final legal form of a deal is yet unresolved. The deal will create trust and assurance in the system so that other countries stand by their promises to take action - so called “monitoring, reporting and verification”.
Secondly, the private sector is crucial to the success of making the global agreement happen once the paper work is signed. Yes, public funding will be vitally important in helping the world reach the $100 billion a year of funding for developing countries by 2020 to help them green their own economies as well as adapt to the impacts of climate change.
But a significant portion of that finance will also flow from the green low carbon investment of British and other businesses (sometimes with public funding used to get it started) - helping, for example, develop new renewable sources of energy. The private sector will also be crucial partners in delivering real cooperation on clean technology.
Thirdly, business has now established itself as a vital part of the fight against global warming. A much greater voice for the private sector was evident in and around the talks. The voice of forward thinking business is quickly becoming the voice of reason and progress during these negotiations. A trade fair, opened by the Mexican President, provided a practical inroad for many businesses, several of them British, into the talks.
And finally, while the elusive final legal treaty is not yet with us and challenging negotiations will still take place, the UK and many other countries from around the world will be emboldened to move faster to make our economies less reliant on traditional fossil fuels.
Here in the UK, the coalition Government’s actions are setting out a long term plan of strategic delivery. We’ve no intention of taking the foot off the pedal. An Energy Bill was presented to Parliament last week, which if agreed, would radically transform the energy efficiency of Britain’s leaky housing stock as well as help employ up to 250,000 people in the next decade.
And yesterday, The Rt Hon Chris Huhne MP, Energy and Climate Change Secretary, published plans and far reaching reforms to our electricity markets to incentivise the billions that needs to be invested into green energy production. British companies stand ready to reap the huge advantage of being the first movers in this century’s fastest expanding new sector.
We will be working in partnership with the private sector to drive home that opportunity.