Late stage climate action analysis

𝗗𝗲𝗹𝗮𝘆𝗶𝗻𝗴 𝗰𝗹𝗶𝗺𝗮𝘁𝗲 𝗮𝗰𝘁𝗶𝗼𝗻 𝗱𝗼𝗲𝘀𝗻'𝘁 𝗷𝘂𝘀𝘁 𝗶𝗻𝗰𝗿𝗲𝗮𝘀𝗲 𝗽𝗵𝘆𝘀𝗶𝗰𝗮𝗹 𝗰𝗹𝗶𝗺𝗮𝘁𝗲 𝗿𝗶𝘀𝗸; 𝗶𝘁 𝗶𝗻𝗰𝗿𝗲𝗮𝘀𝗲𝘀 𝘁𝗿𝗮𝗻𝘀𝗶𝘁𝗶𝗼𝗻 𝗿𝗶𝘀𝗸 𝘁𝗼𝗼, 𝗰𝗼𝗺𝗽𝗼𝘂𝗻𝗱𝗶𝗻𝗴 𝗰𝗼𝘀𝘁𝘀 𝗮𝗰𝗿𝗼𝘀𝘀 𝘁𝗵𝗲 𝗲𝗻𝘁𝗶𝗿𝗲 𝗲𝗰𝗼𝗻𝗼𝗺𝘆. Businesses often analyse climate risk as a binary choice: prepare for a hot world (physical risks) or a low-carbon one (transition risks). The reality is that inaction makes 𝘣𝘰𝘵𝘩 outcomes more risky and therefore more expensive. This is what I'm calling the inaction penalty: a two-front cost that is increasing both physical risks and transition risks. 𝗧𝗵𝗲 𝗜𝗻𝗮𝗰𝘁𝗶𝗼𝗻 𝗣𝗲𝗻𝗮𝗹𝘁𝘆 🔸 𝗗𝗲𝗹𝗮𝘆 𝗰𝗼𝗺𝗽𝗼𝘂𝗻𝗱𝘀 𝗽𝗵𝘆𝘀𝗶𝗰𝗮𝗹 𝗿𝗶𝘀𝗸. Every day we fail to cut emissions adds to the cumulative stock of GHGs in the atmosphere, locking in more warming. The WEF report "Cost of Inaction" finds that in a >3ºC world, exposed sectors like utilities and communication services could see over 25% of their EBITDA at risk by 2050 from physical damages. 🔸 𝗗𝗲𝗹𝗮𝘆 𝗰𝗼𝗺𝗽𝗼𝘂𝗻𝗱𝘀 𝘁𝗿𝗮𝗻𝘀𝗶𝘁𝗶𝗼𝗻 𝗿𝗶𝘀𝗸. A gradual, orderly transition over 20 years is manageable. A delayed, frantic transition compressed into 10 years is financially chaotic and disruptive. This "disorderly" path is forced when inaction requires emissions to be cut harder and faster to avoid the worst effects of climate change. The WEF report estimates that in this rapid scenario over 50% of EBITDA is at risk for some sectors. Such a fast transition could see significant capital write-downs. The report estimates that 35% of the book value of upstream oil assets would have to be written off by 2030 in a rapid transition. 🔸 𝗥𝗲𝗴𝘂𝗹𝗮𝘁𝗼𝗿𝘀 𝘀𝗲𝗲 𝘁𝗵𝗶𝘀 𝗿𝗶𝘀𝗸 𝗰𝗹𝗲𝗮𝗿𝗹𝘆. The ECBhas warned that 90% of the 95 major banks it analysed are "misaligned" with the Paris Agreement, creating systemic risk. Other analyses show a disorderly transition could more than double the default risk for lenders in some regions. 𝗠𝘆 𝗧𝗮𝗸𝗲 The debate is no longer 𝘪𝘧 we will transition, but 𝘩𝘰𝘸. Delay is not a strategy; it is a decision to choose a more expensive and disruptive path. The data in the attached image, which is taken from the WEF report, shows two very different, but equally costly, futures. The left side (Physical Risk) is the cost of a "hot world." The right side (Transition Risk) is the cost of a "fast world." Both are a direct result of inaction. This is not a 2050 problem. Risks are accumulating now. The most prudent financial strategy is to act decisively, manage the transition on your own terms, and get ahead of the inevitable volatility. Source: https://lnkd.in/eezsBdbr #ClimateRisk #Finance #ESG #RiskManagement #Strategy #Economics #CEO #Sustainability _____________ For updates on sustainability and climate follow me on LinkedIn: Scott Kelly

Here are the main takeaways from the "State of Climate Action 2025," a comprehensive and urgent assessment of our collective progress toward a 1.5°C future. Published under the Systems Change Lab, this report is a major joint effort between the Bezos Earth Fund, Climate Analytics, ClimateWorks Foundation, the Climate High-Level Champions, and World Resources Institute. Main Takeaways 1️⃣ The report delivers a stark but necessary message, while there are bright spots, our collective global efforts are falling dangerously short. 2️⃣ Of the 45 key indicators assessed across power, buildings, industry, transport, forests, and finance, none are on track to achieve their 2030 targets. 3️⃣ A Story of Mixed Progress: ✅ Off Track (but promising): 6 indicators are heading in the right direction, albeit too slowly (e.g., private climate finance, EV sales). ✅ Well Off Track: A staggering 29 indicators are far below the required pace, including critical areas like phasing out coal power and halting deforestation. ✅ Wrong Direction: 5 indicators are moving in the wrong direction entirely, such as the share of trips taken by passenger cars and public finance for fossil fuels. ✅ The Acceleration Imperative: An enormous acceleration is needed across every sector. For example, the phase-out of coal-fired power must accelerate by more than 10 times, and the decline in deforestation needs to speed up ninefold. Challenges ✴️ In a year marked by geopolitical tensions and economic headwinds, we have witnessed a troubling retreat from climate commitments. The US, the world’s largest historical emitter, has scaled back climate policies, and several leading corporations have weakened their commitments. ✴️ Growth in EV sales, previously the only indicator on track, has slowed and is now off track. Efforts to reduce coal power and deforestation remain stubbornly "well off track." ✴️ Global GHG emissions continue to climb, reaching 56.6 GtCO₂e in 2023. We are living through the hottest decade on record, with devastating consequences already unfolding. Opportunities & Bright Spots ✳️ Despite the sobering overall picture, the report highlights that rapid, transformative change is possible. ✳️ Solar is the fastest-growing power source ever, and the share of zero-carbon sources in electricity is rising. China's installed solar capacity alone surpassed 1 terawatt in 2025—a 1,000-fold increase since 2010. ✳️ Clean energy investments are set to surpass $2 trillion in 2024, approximately double the investment in fossil fuels. ✳️ Promising innovations such as green hydrogen and technological carbon dioxide removal saw meaningful one-year gains. ✳️ The report spotlights countries like the UAE and Chile, which are decarbonizing their electricity generation more than four times faster than the global average. #StateOfClimateAction #ClimateAction #ClimateChange #ParisAgreement #SystemsChange #NetZero #Decarbonization #Sustainability

The United States is likely to return to being the biggest emitter of greenhouse gases globally. As China's emissions plummet in the coming years, the United States will become a free rider on other countries' climate action. Full article with charts, tables and depressing data: https://lnkd.in/gBxzq3gz Pro tip: read the full article before commenting. The free rider problem in climate action emerges when some countries benefit from others' efforts to reduce emissions without contributing equally. While the U.S. has made strides, particularly with the Inflation Reduction Act (IRA), it’s still behind Europe and China in climate action. The U.S. remains the world's largest fossil fuel producer and exporter, undermining its emission reductions by replacing domestic coal use with natural gas and exporting coal, oil and gas abroad. The U.S. has the highest oil and gas industry methane emissions of any country, and its reliance on natural gas is hindering decarbonization. Further, the one to two barrels of oil equivalent of energy required for each barrel of shale oil's drilling, fracking, extraction and processing are hidden behind the meter and so don't show up in energy and usually emissions statistics, meaning the country's slight increase in electrification over the past 30 years is overstated. The U.S. is lagging in electrification across sectors like transportation, heating, and rail, while other regions such as Europe, China, and even parts of Africa, are advancing faster. In many sectors such as transportation and housing, it has mostly unintentionally created the hardest to decarbonize system in the world, and so decarbonization will be slower and more expensive. The US automotive sector can't build even expensive electric cars for a profit, never mind ones affordable to 80% of the population, and cars and light trucks are absolutely required in the country due to sprawl. The unprecedently high tariffs and now the software ban on Chinese EVs and batteries means no cheap EVs for Americans, and so much slower progress. Carbon pricing and fossil fuel subsidies further complicate U.S. climate efforts. Countries like China, Europe, and India are implementing carbon markets and cutting fossil fuel use, while the U.S. has cheap fossil fuel energy prices that discourage energy efficiency and electrification and no carbon price. The only silver lining to this dense cloud of oily smoke is that there are signs that US shale oil is plateauing as an economically viable industry and with peak oil demand may actually collapse as quickly as it emerged. Good strategy must start with a clear statement of reality. I see few climate strategists or policy makers in the USA who are clear on the reality of the country's situation. #policy #strategy #climatechange #politics

Undertaking a program of action against climate change ten years from now is almost as expensive as getting started on a more ambitious effort to stop climate change today, according to a new study. In the new study, researchers instead analyzed a large number of scenarios within one massive model of the global climate, economy, and energy system. They used a supercomputer to crunch 700 gigabytes of data and simulated 4,000 different scenarios for 10 regions of the world through the year 2100. The analysis took into account 18 different sources of uncertainty and involved adjusting 72,000 different variables for each scenario. Of the 4,000 scenarios, 70% suggest that the global temperature increase will exceed 1.5 °C in the next 5 years, the researchers report in the journal Energy Policy. Decarbonizing the global economy is likely to be very expensive: on average, the 1.5 °C scenarios require an investment of $8 trillion in 2030 and $26 trillion in 2050. Delaying climate action is cheaper in the short term – but the costs of limiting warming to 2°C with action starting ten years from now are similar to the costs of limiting warming to 1.5 °C with action starting today, the researchers found. Delay also “would risk higher stranded assets in energy supply and use and irreversible climate change damages as in more than 55% of those scenarios with delayed action the temperature increases by more than 2°C in 2050,” the study’s lead author said. https://lnkd.in/ewpWQn7M

🌍 The way we are approaching, encouraging, and assessing #NetZero—through NDCs, corporate targets, and carbon accounting—is not just inherently insufficient, it is actively counterproductive. Net zero is an atmospheric imperative. Achieving it requires: • Decarbonizing the world’s energy, industrial, and food systems • Enhancing the absorptive capacity of the world’s carbon sinks Transforming these systems requires: • Clear roadmaps • Technological innovation • Adequate public and private finance • And coordinated action among public and private actors across sectors, borders, and value chains Our dominant frameworks—focused on individual country and corporate target-setting, measurement, and accounting—falsely assume that systemic, regional, and sectoral transitions can be delivered by the sum of individual targets and plans. This flawed logic disincentivizes the coordination needed. Rather than identifying an entity’s leverage to address systemic barriers to decarbonization, both countries and companies, which cannot decarbonize on their own, purchase offsets so they can methodologically “claim” to be net zero while continuing to emit, increasing rather than decreasing atmospheric GHGs. This has also led to a reliance on credits to fund nature-based and technological solutions that need substantially more and reliable financing. We’ve built an entire architecture around the wrong unit of ambition and analysis, and we are now fixing symptoms (to make the accounting more credible), not confronting the underlying structural misalignment. Accelerating climate action requires decisively shifting from individual targets to coordinated, transformative planning and implementation. This means: 🔁 Prioritizing and supporting Long-Term Low-Emission Development Strategies (LT-LEDS), which are inherently more ambitious and pragmatic than NDCs. 🛤 Supporting scenario planning and sectoral roadmaps, not just insisting on more ambitious NDCs and FF phase-outs. In many EMDEs, there aren’t clear technical roadmaps for how FF-based energy can be replaced reliably and financed affordably. 🤝 Facilitating coordination across regions, value chains, and stakeholders, not emphasizing individual action. 💸 ensuring adequate and affordable financing for the necessary transitions. (Note: private capital doesn’t move because of better carbon accounting, risk metrics, or pressure. It moves when transitions become financeable: - Enabled by clear roadmaps and aligned policy and regulations - Structured through investable market design by coordinating demand and supply - Supported by public finance and tailored risk mitigation) As we head into New York Climate Week, I hope we focus less on statements of ambition (NDCs and corporate targets) and more on rigorous, technically grounded transition pathways—and the collaborative, cross-sector engagement required to deliver them. The stakes are too high to keep solving the wrong problem.

Is it too late to avoid 2C of global heating? Many news outlets are covering a study from James Hansen and colleagues. It says that the goal of limiting to 2C is now 'dead'. They're making this call because they think the rate of warming is higher than might be generally understood. This is mostly because the study concludes that the impact of recent cuts in shipping pollution is causing higher warming than anticipated and that the sensitivity of the climate to increasing fossil fuels emissions is also greater than thought. It means they expect higher future temperatures than many other scientists. So, there will be much continued debate about the merits of the study. But, for now, the study touches on some important strategic challenges that we know for certain do exist - and which are not tackled enough in certain places, including some strategic parts of govts/firms. Firstly, all models of temperature and climate impacts - models which inform our mental model of climate change and strategies to respond - have ranges. Mostly, these are ignored when we talk about climate change: we talk about the middle estimate. For example, Climate Action Tracker estimates of warming by 2100 based on current policies is reported as 2.7C. But the range is 2.2C to 3.4C. As is the norm with any other risk, it is prudent to focus on the high end of the range (3.4C in this case). Hansen's conclusions can't be ruled out: they are in the higher end of the range. Secondly - and as a direct consequence - mitigation and adaptation action could be even more inadequate than we already recognise. If 2C is 'dead' then adaptation will have to accelerate rapidly *right now*. This will have to be done in a way that simultaneously reduces emissions to minimise the risks of worst cases, like AMOC collapse (which Hansen warns is made more likely by his results). Thirdly, regardless of whether Hansen is correct, there is a vast and growing gap between the generally understood level of climate risk and the actual level. Markets, govts, public debate etc are hiding a *lot* of unreleased risk. When that is revealed and becomes widely understood - likely through events and not more studies - then its effects could be destabilising. Fourthly, there are potential trade offs arising from emissions reductions that might complicate global decarbonisation strategies. This is clearest with reductions in shipping pollution which might be having the unintended consequence of increasing emissions (because the pollution was previously reflecting sunlight back into space). This doesn't mean that this pollution should not be reduced: it should because it is bad for health and the climate. But it will mean that other emissions reductions must be expedited to balance out any unintended consequences. As many have argued, rapid reductions in methane is a way to do this. https://lnkd.in/e8xTNVSc

Earthood’s Six-Step Framework for an Advanced Climate Action Plan 1. Anchor Climate Action with Executive Accountability Every transformative climate journey starts with executive-level endorsement and governance integration. Earthood helps secure this foundation by facilitating C-suite alignment, establishing climate-linked KPIs, and embedding accountability into the organization’s performance framework. A credible climate plan begins where commitment meets strategic intent. 2. Build a Cross-Functional Climate Strategy Team Effective action requires collaboration across departments. Earthood supports the creation of an interdisciplinary climate task force, incorporating leadership, sustainability, operations, finance, and legal teams. Our specialists can co-lead or advise your internal working group to ensure climate goals are operationalized—not just documented. 3. Assess Current State & Define Climate Trajectory With deep expertise in emissions accounting and climate risk evaluation, Earthood conducts a full emissions baseline assessment (Scopes 1, 2 & 3) and reviews policies, processes, and operational risks. We integrate climate scenario analysis (aligned with TCFD) to map out your risk exposure and identify opportunities, laying the groundwork for data-driven target setting. 4. Set Science-Aligned Goals & Sector-Specific Targets Ambitious climate action requires rigor. Earthood helps you set SBTi-compliant near-term and net-zero targets, grounded in global best practices. Our consultants ensure your goals are SMART, sector-appropriate, and backed by technical and financial feasibility. We also guide on disclosures for frameworks like CDP, SBTi, and GRI. 5. Design a Detailed and Resilient Climate Action Roadmap Beyond target setting, Earthood helps architect implementation blueprints that are realistic and resilient. This includes policy interventions, decarbonization pathways, investment planning, and stakeholder engagement strategies. Our team can simulate impacts, help prioritize interventions, and integrate climate governance into enterprise systems. 6. Execute, Track, Verify & Improve Implementation isn’t just about action—it’s about iteration. Earthood supports organizations with progress tracking, climate data management, and third-party verification for transparency and credibility. We ensure your Climate Action Plan evolves with changing business and climate dynamics, staying audit-ready and future-proof. #ClimateActionPlan  #NetZeroStrategy  #SustainabilityLeadership   #CarbonManagement  #GHGAccounting #ESGStrategy #ScienceBasedTargets  #SustainabilityConsulting  #CDP  #Decarbonization  #Earthood  #GreenTransition 

It is clear that the compelling economic case for investing in #climate change #mitigation and #adaptation is not broadly understood. Too Hot to Think Straight, Too Cold to Panic? Governments, businesses, and people worldwide are paying the price for the #storms, #floods, #heat waves, and #droughts that are caused by climate change. Without the investment necessary to reduce further global warming, the economic growth and resilience on which the world relies will be severely diminished along with societies ability to achieve their broader goals. Together with colleagues at the Boston Consulting Group (BCG) we set out the economic case for climate action—and how we can make it influence decisions today. ❌ The global average temperature has risen significantly since the industrial revolution ❌ The physical effects of #ClimateChange will significantly reduce economic #productivity and damage economic #assets this century ❌ Rapid and sustained global investments in #mitigation and #adaptation will reduce the economic damages and should come with a high return ❌ Despite the economic case for staying below 2°C, the world is not on track to do so We have observed five barriers to accelerated climate action: 🎯 The first is that the political discussion often overlooks the economic case for climate action, particularly early on when the costs to reduce emissions are often quite high. But over time, climate change will slow growth and weaken resilience, undermining societies’ broader objectives, including improving #health care and strengthening #security. 🎯 The second is that many costs of climate action come before 2050, but the bulk of the economic benefits will be evident after 2050. 🎯 The third barrier is that the costs and benefits of climate action are unevenly distributed among countries. Even in the #ParisAgreement, there is no global consensus on how emissions should be reduced. 🎯 The fourth is that the transition threatens to create winners and losers within economies, requiring a just #transition and #equitable economic development. 🎯 Finally, the fifth barrier is that the economic damages of climate change are not understood by economists to their full extent or with enough detail. Fortunately, the barriers can be addressed with sustained effort from leaders in five areas: 🌍 Reframing the debate on the costs of climate change 🌍 Creating transparency on the net cost of inaction across all actors 🌍 Strengthening national climate policies to accelerate mitigation and adaptation 🌍 Reinvigorating international cooperation on climate change 🌍 Advancing our understanding of the net cost of inaction More details in our latest work here: https://lnkd.in/eJWvCtGm University of Cambridge #climaTRACES Lab | CRASSH | Cambridge Judge Business School | King's College, Cambridge | Cambridge Zero | Gates Cambridge

💡 New OECD-UNDP analysis provides evidence that higher climate ambition makes economic sense. This is certainly true for China - let me explain 👇 As nations prepare their next round of climate commitments for 2035 with their Nationally Determined Contributions (NDCs), the OECD and UNDP have joined forces under an initiative to demonstrate that investing in robust climate action fosters better growth for all. They argue that global GDP would be higher in an enhanced NDC scenario compared to the current policy scenario. In China, clean energy sectors are already the top driver of economic growth and contributed a whopping $1.9 trillion to the economy in 2024 - that's 10% of China's GDP! Since China announced its climate targets for 2030 and 2060, investment in clean energy sectors has grown exponentially. Without these, China would have missed its GDP growth targets for 2023 and 2024. On the other hand, policy uncertainty weakens investment and slows growth, according to the OECD and UNDP. This could lead to 0.75% GDP reductions as early as 2030. A strong Chinese NDC to reduce emissions by at least 35% by 2035, with clear sectoral targets for continued clean energy build-out and phase-down of coal, would provide the necessary planning certainty for clean energy sectors to continue their unprecedented growth. There is a vested interest if these sectors are to continue propping up China's economy. Accelerated climate action would also reduce the risk of climate damages and with that economic losses that could be as high as 3% of global GDP by 2050. Climate change already causes damages of about 0.4% of GDP in China today. Not to speak of the benefits for people who wouldn't suffer from the same levels of droughts, floods, and other extreme weather events that are already hitting China and the world harder each year. The 2025 NDC cycle is an opportunity to build collaborative approaches around climate, development and growth priorities, broaden and strengthen ownership of development-enhancing mitigation strategies, and inform effective investment plans and strategies to mobilise public and private sources of finance to deliver action. Great insights by OECD - OCDE and UNDP at the Petersberg Climate Dialogue, hosted by Germany. Well worth a read and looking forward to the full report in May. #China #NDC #Climatechange #OECD #UNDP #PCD https://lnkd.in/ePRrRVJZ

The next climate breakthrough may not be a new turbine or battery. It may be a better baseline dataset. 🌍 Copernicus ECMWF has started ERA6 production — the next flagship climate reanalysis after ERA5. Why that matters is not the headline alone, but what sits underneath it: • 📍 14 km vs 31 km resolution means a much sharper view of storms, coastal dynamics, land–atmosphere interactions, and local weather risk. That matters for wind/solar siting, grid planning, insurance, and infrastructure resilience. • 🕒 Hourly reconstructions stretching back 75+ years create a stronger historical baseline for trend analysis, asset stress-testing, and climate-risk decisions that are still too often made on weak local proxies. • 🌊 First-time ocean–atmosphere coupling in ECMWF’s flagship reanalysis improves system coherence. That is a big deal for coastal risk, storm surge work, shipping, offshore wind, and any analysis where disconnected datasets distort reality. • 📚 +50% to more than doubling of some observations versus ERA5 is a reminder that climate intelligence is only as good as the data rescue, correction, and assimilation behind it. • 🤖 In the middle of the AI wave, ECMWF makes an important point: the best ML models still depend on robust physics-based training data. Better AI starts with better ground truth. My take: ⚡ We spend a lot of time talking about transition technologies, and not enough time talking about measurement infrastructure. But better data changes real money decisions: where to build, how to insure, what to finance, how to model risk, and which assets stay competitive under climate stress. For energy, transport, and physical-risk teams, ERA6 is not “just another dataset”. It is an upgrade to the decision layer. 📈 Watch next: 👀 • Late 2027: first decades of ERA6 data expected • Early 2028: first four decades expected to be downloadable Who will benefit first from ERA6-quality data? A) renewables & grids B) insurers & infrastructure investors C) logistics / shipping / coastal risk teams #ClimateData #Copernicus #ECMWF #EnergyTransition #ClimateRisk #Infrastructure #AI