Was COP26 another step towards disaster?

Greta Thunburg was right – there was a lot of blah, blah, blah at COP26, but also positive steps. The perception remains of rising climate risks, and that’s fuelling an increasingly de-growth extreme climate change populist agenda – which could prove even more disastrous than rising temperatures!

Blain’s Morning Porridge, November 12 2021: Was COP26 another step towards disaster?

“From Glasgow to Greenock, in towns on each side, the hammer’s ding-dong is the Song of the Clyde”

This morning: Greta Thunburg was right – there was a lot of blah, blah, blah at COP26, but also positive steps. The perception remains of rising climate risks, and that’s fuelling an increasingly de-growth extreme climate change populist agenda – which could prove even more disastrous than rising temperatures!

As the COP26 climate change conference ticks into its final day, was it a success for the planet or for institutional blah blah blah? I guess we should listen to the scientists… so this morning I’ve taken the gospel according to New Scientist Magazine as one of my texts on the conference. Nicely balanced I thought.

I am somewhat jaundiced at the prospects for a massive conference-jamboree of politicians, businesspeople and activists actually solving anything – but it does get media attention. We may quickly forget the utterly forgettable Alok Sharma (who he?), but we will remember Greta! We won’t forget the massive protest march in Glasgow. But, since the first COP1 meeting in Berlin in 1995, global CO2 levels have risen nearly 50%, temperatures are up 0.5 degrees, and the ice on the Greenland cap is melting faster. Talk is cheap – but people are listening now.

The first draft summit communique yesterday didn’t please anyone – apparently. It urged nations to revisit and strengthen 2030 plans to hold warming to 1.5 and below 2 degrees. While Boris promises us the 1.5 degree temp rise ambition is achievable, the UN warned it’s on life support. Who do you believe? Depending on who you read the outcome will be anything from a 2.4 – 2.7 degree temperature rise – which will leave climate scientists in despair. The reality is holding to the 1.5 degree target looks increasingly unlikely, even if the world has agreed to cut methane by 30% – which means teaching cows to fart less or selling MickyDee Stock. (MickeyDee? Look for them at sign of the Golden Arches..)

Funding for developing nations to ameliorate climate change and to transition from fossil fuels has already fallen well short of what was promised in Paris. While $100 bln is on offer, that’s the same sum India wants as a precondition to action its promised zero carbon plan for 2070. While there is a clearly justified case for the developed nations to pay, it’s an enormous risk. The unspoken reality (unspoken because climate conferences are all about trust, being nice and smiling for the camera, and not mentioning corruption) is the risk much of that money will simply end up making some folk incredibly rich and improving nothing.

One big issue remains corporate behaviours – more corporate jets and Sushi flown in fresh from California than you could shake a sharp pointy stick at. Every company on the planet wants to be seen to be aligned with the new Green Mantra. Every company on the planet exists to sell stuff. More than a few are greenwashing – from banking, to autos, to airlines. I could have screamed at BA havering on about how sustainable hydrogen planes tomorrow mean you can still go on holiday today with a clean conscience – but hydrogen plans have massive tech challenges to overcome and are decades, not weeks, away!

While some nations have banded together to outlaw fossil fuels, others are on the sidelines – while some remain absolutely deaf. Highlight moment from Glasgow has to be the perhaps apocryphal story of Scotland’s smiling first minister Nicola Sturgeon manoeuvring herself into a selfie with Greta, who snapped and asked pointedly if La Sturgeon’s economic plan remained an independent Scottish economy based on Oil… curiously, Scotland hasn’t joined the new European Beyond Oil and Gas Alliance, Sturgeon realising what the loss of 100,000 jobs would do her political future.

Over the past years I’ve written about the threats of climate change and global warming many times. I accept the science, and this year’s mounting evidence of rising – potentially chaotic – climate instability. I absolutely agree we have to do something – but what? There has been nonsense in Glasgow, but equally some good and positive stuff around it… The critical thing is: COP was never going to be the magic wand climate protestors demand.

COP26 confirms World Leaders recognise the climate issue – but its left just as many questions hanging as to how we collectively solve the multiplexity of the crisis. The conference was long on pledges, promises and questions, but short on actual solutions. At the core of the coming crisis is what we perceive to be the threat: how do we transition from fossil fuels?

Pragmatists understand a complete restructuring of global energy provision can’t happen overnight. It took 200 years for the world to industrialise and destabilise the climate. With the right political push and incentives, we have the wit and wisdom, and innovative capacity to make it cleaner over the next 30-50 years. We are an inventive species, and we may actually succeed in making things better. Just not overnight.

Yet, of all the climate instability factors markets worry about, the one we might have missed is the growing consequences of green populism. The climate crisis could well manifest itself into a more immediate threat: political instability.

Being green is no longer eccentric – its mainstream. Everyone will answer yes if asked about a better environment. That has moved the goal posts. Increasingly, extreme climate protestors are supporting “De-Growth” strategies – that it’s better to somehow switch off the world to avoid a catastrophic Malthusian disaster caused by too many people consuming to many resources and polluting our closed system spaceship earth. Malthus was wrong in the 18th Century and is no doubt still wrong today!

What COP26 protests highlights is how polarised Green politics are on collision course with the economy and growth. It’s going to take years to wean the economy off fossil fuels, but protestors will demand it happens now! Governments have politically committed themselves to a Green future, but are only just waking up to the reality of the need to transit from fossil fuels to renewables – which isn’t feasible without a long-term plan.

Much as I admire the passion of green campaigners, the current volatility of energy pricing demonstrates a massive underlying transition problem and political naivety. We can’t fundamentally change energy provision overnight. Climate protestors furious this generation have “stolen” their futures will be even less happy if they succeed in reversing economic growth. The result will be to ensure billions of children as yet unborn don’t just face rising temperatures and sea-levels, but also chronic poverty, unemployment, starvation, migration and rising conflict over the environment – water being the primary threat.

While “democratic” western nations may embrace Degrowth populism – nations like China will not.

It doesn’t need to be a frying pan vs fire choice, but that’s not the way popular politics work.

The real failure of governments wasn’t ignoring Greta et al and the evidence of global warming, but not anticipating it and working out a transition plan. In coming years, the noise between climate protests and the slow pace of the transition to clean energy will get louder and become ever more likely to dislocate politics. It sets up for a political crisis within the next few years as empowered Green campaigners garner more air time. That has massive market implications.

Pragmatists take the view we need a well thought out transition programme. I’ve warned about the dangers of over-simplification of the financial and economic aspects of the CO2 mitigation equation many times. There are consequences from doing the easy things like wind and solar renewables and lithium battery technology, rather than pursuing more difficult routes like nuclear and tidal energy, and cleaner capacitance solutions to get to long-term carbon neutrality.

I’m intrigued to see the latest iteration of the EU’s Green Taxonomy includes Gas during the transition phase and also Nuclear power – a factor that already got some nations antsy! (Ah, how well I remember my student protest days at the Torness Nuclear power construction site and my girlfriends “nein danke nuclear” sticker on her 2CV… ah happy days..)

The result of the current mishmash of competing green vs transition politics means that navigating the course to a clean global economy becomes a confusing mass of objectives such a timing carbon neutrality, realities such as population and economic growth, short and long-term solutions, and optimisations such as power vs growth. We all need to make compromises to get where we want to go. But, as is so often the case, compromise is a difficult concept for politicians. It’s even more difficult for extreme climate protestors.

By all means trade markets in line with green objectives, but be very wary of just how destabilising Green Politics may become.

Five Things to Read This Morning

New Scientist – First Draft of COP26 Agreement urges countries to revisit plans

BBerg – Net Zero Alliance intends to reject Gas, Nuclear as green assets

BBerg – EU’s Climate Chief signals Gas will be included in Climate Transition

FT – Big Business and COP26: Are net Zero plans credible?

Garuniad – COP26 Targets to weak, say Paris Agreement architechs

Out of time, and taking the rest of the day off, because Friday is a rest day here in Dubai!

Bill Blain

Strategist – Shard Capital


  1. It is amazing how today’s porridge is applicable nearly word for word to the incapacity of the EU to get agreement on fundemental reform : agreement on many principles but incapacity to act!. In addition disagreements among EU Members on climate change break down differently than their fights on sovereignty, immigration etc;

  2. I’m no supporter of pollution or sticking one’s head in the sand, but “the science” is hardly settled, and deindustrialisation of the developed world is hardly a solution. Net Zero is a sham.

    On a related note, I’m getting plenty of pressure to buy Green Bonds even though I’m content with the portfolios I manage being invested in gilts and IL-gilts, as if greens are a better thing with their higher risk and lower return.

  3. While an economic and/or political perspective can provide interesting interpretations of our planet and human circumstances, they tend to put Homo sapiens outside of or above nature. As biological organisms, however, we are fully part of the natural world and its complexities. Might I suggest you read William Catton Jr’s Overshoot. It will provide an ecological perspective on our predicament of too many people consuming too many non-renewable (even renewable) resources on a finite planet. He evens explains why the principle behind Malthus’s arguments are, in fact, correct. You might find it an enlightening read.

  4. The disparity in “talk” and “action” is the first and largest clue that this is all nothing more than a new ‘Grift” …… and “Grifters” are going to “grift” ………………………………..

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