By Kristina Bujold for InvestorPlace
The Scottish government announced a global partnership agreement for a global zero emission transition, setting its sights squarely on a pact of regionalism which could have significant implications for global markets.
In announcing the agreement, Scottish first minister Nicola Sturgeon painted the partnership as a plan that promotes cooperation on ways to make climate change a real — not “far-flung risk” — for the planet. The initiative aims to target emissions 40% below 1990 levels by 2030 and 80% below 2010 levels by 2050, which would equate to a 4-degree global warming in just 40 years.
What’s in the Glasgow Climate Deal?
The Scottish agreement involves 11 environmental organizations from around the world, along with governments including Australia, France, Germany, India, Canada, South Africa, Spain, and the U.K. — one of which includes the global wind firm, Statoil.
Through the Global Platform for Climate Action, these groups hope to coordinate their efforts to push for action and deal with climate change. The umbrella coalition hopes to enact concrete measures such as a “pragmatic decarbonization of the global economy.”
With oil and gas accounting for 90% of Scotland’s economic production, the partnership’s agreement involves considerable symbolic weight. Statoil’s global scale is currently being used to sell Scotland’s oil reserves as part of a bid to lower Scotland’s greenhouse gas (GHG) emissions.
This non-binding cooperation is known as the Carbon Zero Accord, signed by 10 representatives from each of Scotland’s 27 members. The price tag for Carbon Zero is $1.75 trillion, an actual amount according to Statoil’s target of having no GHG emissions by 2050.
At the current pace of emissions reduction, Scotland would be effectively self-sufficient in 2050. With additional collaboration, the solution may be quite feasible. With the oil resource in mind, the Scottish government has already launched a Zero Emissions Communities Project which includes 45 projects with a combined investment of nearly $10 million.
A Global Carbon Agreement?
This development is important for investors who must get their hands dirty in the real world, but also for Canadian investors who would love to benefit from the carbon plan proposed by the Scottish government.
The bulk of Canada’s fossil fuel industry comes from oil, such as: