On Wednesday 24 March, Glennmont Partners hosted a webinar session titled ‘Financing Build Back Better’ with speakers including:
Chair of the Climate Change Committee, Rt Hon Lord Deben
Chief Executive of the Renewable Energy Association, Nina Skorupska
Head of Energy and Environment at the International Energy Agency, Tom Howes
The event was chaired and introduced by Glennmont’s Co-founder and Partner, Peter Dickson. The panellists were then invited to share their insights on the pandemic, how they viewed the global response to the crisis and the efforts to recover from it. The panel went on to discuss how the COVID-19 pandemic had influenced global views on decarbonisation, what success at the upcoming COP26 summit would look like and how the financial sector can go further to drive the global transition to net zero.
A summary of the key conclusions and themes drawn from the webinar’s panellists include:
In his remarks, the Rt Hon Lord Deben said the pandemic had caused a “revolutionary change in the way the sector looks at the climate and sustainability”. He noted that the pandemic had acted to accelerate trends which had been developing, albeit slowly, in recent years. Lord Deben added that the financial recovery from the pandemic was intrinsically linked to a green recovery, and that in its Sixth Carbon Budget, the Climate Change Committee had highlighted that the private sector will be relied upon to carry the financial weight of decarbonising.
Lord Deben said that the US “re-joining” the world under President Biden meant that further pressure was being applied on a global scale to support the transition to net zero. He said that it was vital that COP26 builds on the momentum from the Paris summit 5 years ago, noting the success of those negotiations in bringing the world together to work for one cause. Lord Deben asserted that it was now clear what the future will look like and that the financial community must support this transition, investing in sustainable, legacy projects which have a role to play in our net zero future.
Tom Howes detailed how the pandemic had caused major disruption to the global efforts to decarbonise – he sighted the IEA’s recent figures which show that despite an initial drop, emissions in December 2020 had rebounded to higher than they were in December the year before. He noted the worrying growth of emissions in China and other parts of Asia despite the “lingering effects” of the pandemic.
Mr Howes went on to discuss the effect the pandemic was having on fiscal policy, adding that changes to attitudes towards debt had helped to make the financing of green recovery projects easier. Tom added that the sector must be ambitious and actively seek out corporate strategies which have sustainability as a focus, noting that without foresight, investors would end up with stranded asserts and limited returns.
Nina Skorupska discussed the active role governments had played in shaping the recovery from the pandemic – noting that the UK Government had pro-actively taken measures to ensure that representatives of the renewable energy sector were central to discussions about recovery. She praised the UK Government’s approach to energy security during the pandemic, noting that this was balanced with the aims of achieving “a low carbon future”. Ms Skorupska described COP26 as a “beacon on the future horizon”, adding that the Summit was an opportunity for the UK to celebrate the success of recent years, but also to build on the momentum following the Paris Agreement.
Ms Skorupska added that the financial sector has a vital role to play in further driving the development of emerging technologies, financing the vital innovation needed to make our transition, but that governments must also play a role in delivering credible policy which aligns with this. On this, she advocated for regulatory reform to speed up innovation, adding that the pandemic had shown industry how quickly governments can move to make policy, and that this must be a learning from the pandemic that can be utilised for the global transition.