Something big just happened in New York. More than 400,000 people noisily took to the streets, and over 120 heads of state stepped up to the podium at the United Nations to demonstrate their commitment to climate action. “We cannot condemn our children… to a future that is beyond their capacity to repair,” said President Obama.
But that wasn’t the biggest story.
That’s because the real news out of the UN Climate Summit was up the road on Wall Street—where fund managers and CEOs of some of the world’s biggest companies and institutions signaled they were ready to take the lead.
It started the previous week, when 347 investors overseeing more than USD$24 trillion in assets pledged to support “stable, reliable and economically meaningful carbon pricing,” strengthen regulations for renewable-energy deployment, and more.
Their ranks almost tripled by this past Monday as more than 1,000 institutional investors, financial institutions, and companies—including leading oil companies and airlines—endorsed calls for putting a strong price on carbon pollution and boosting clean-energy investment.
We’re talking about International Airlines Group (the parent company of British Airlines), and CNOOC, the China National Offshore Oil Company. The list amounted to a who’s who of household names including BP, Deutsch Bank, Ernst and Young, Japan Airlines, LEGO Group, Mountain Equipment Co-op, Nestlé, PepsiCo, RioTinto, Royal Dutch Shell, Statoil, Coca-Cola, Unilever, Nokia, Pfizer, KPMG, LaFarge, L’Oreal, and IKEA.
These companies—and hundreds of others—aren’t complaining about the prospect of carbon pricing, they’re begging for it. They’re ready to shoulder the true costs of the pollution they produce, because they know that such policies would not only level the playing field so clean energy can better compete with fossils, they would also unleash the power of free enterprise on the biggest challenge and opportunity of our age.
Meanwhile, the insurance industry committed to double its green investments to $84 billion by the end of 2015 and announced that it would increase the amount placed in climate-smart investments to ten times the current amount by 2020.
And three European and North American pension funds promised to direct more than $31 billion into low-carbon investments.
For the past four years my team has tracked the flow of investment from fossil fuels into clean energy and electric transportation, and the spread of carbon pricing, clean-energy policy, and renewable power targets. Even a few years ago, the sector had a boutique feel to it. No longer.
Global investments in clean energy alone are approximately $250 billion per year, and the International Energy Agency has estimated that if we are to head off the worst impacts of climate disruption, that number needs to quadruple to reach $1 trillion per year.
We are at the head end of what could well become the largest mobilization of capital in human history. For its part, Canada is doing reasonably well. Thanks to provincial leadership, last year we moved up to seventh place in a ranking of G20 nations on clean energy investment.
And yet, in spite of this success and opportunity, many Canadian leaders are still largely looking the other way, stubbornly insisting that carbon-based fuels represent our only competitive energy advantage.
This week’s announcements underscore that the clean-energy transition is no longer the domain of dreamers and early adopters. Instead, it’s quickly becoming the new “business as usual.” Canada’s leaders need to take this shift to heart and take steps to minimize the risks it presents for the country, while maximizing the opportunities.
“You can make history or you will be vilified for it,” said Leonardo DiCaprio, the recently named United Nations Messenger of Peace, in what has emerged as the most powerful line from this past week’s Summit.
It’s clear that leadership in accelerating the global transition to clean energy will place us on the right side of history. It’s time we moved over.