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Climate change and the pace of transition

September 21, 2020

With humans themselves acting as a climate change feedback mechanism, the art of managing effective climate transition will need to balance relative costs/benefits in the short and long term between adaptation and mitigation.
Climate Risk and Resilience

For the vast majority of the 10,000 years of the Holocene or “entirely new” interglacial geological epoch in which we live, the impact of human activities on the environment, also called human footprint, had increased steadily but remained negligible against other natural drivers. Then, around 150 years ago something happened, catapulting our human footprint to a first order determinant: we discovered the monumental energy resources contained in the chemical bonds of subsoil fossil fuels.

More than any technological progress it’s that massive energy availability that has allowed us to build the world as we know it today: the Anthropocene, or human epoch, was born.

What we have managed to accomplish in the last 150 years has, however, had a quid pro quo: the combustion of the world’s three main primary energy sources, petroleum, coal and natural gas, has released an accumulated total of about 2,000 billion tonnes of carbon dioxide (CO2) into the atmosphere.

Counting the cost

Climate scientific research, centralised by the Inter-Governmental Panel on Climate Change (IPCC), has shown that cumulative anthropogenic carbon dioxide emissions are near-linearly correlated to earth temperature rise. In other words, a given amount of accumulated emissions determines a global temperature variation. For instance, the 2,000 billion tonnes of CO2 already emitted induced an earth temperature increase of around 1⁰C compared to pre-industrial times. It’s this global warming that has been causing earth climate to change at a pace our planet has historically never seen before.

What this linear relationship tells us though is that if we fix a temperature variation, we can fix a corresponding permissible CO2 emissions budget.

Climatologists have recommended that the average temperature variation has to remain under 2⁰C by the end of the century – compared to pre-industrial times – with good reason if you look at likely impacts on ocean levels and weather patterns. This fixes our CO2 budget at 3,000 billion tonnes (of which 2,000 have already been emitted).

While the implications for managing a 2⁰C increase are difficult to assess with precision, the past can help us to comprehend the magnitude of the transformation at stake. Since the start of the last interglacial period 20,000 years ago to today, the earth global temperature increased by ‘only’ 5⁰C, with virtually all of that increase occurring in the first half of that period. A 5⁰C variation in 10,000 years (0.05⁰C per century) is what ecosystems and humankind had to withstand. By comparison, a 2⁰C increase by 2100 represents a 20-fold acceleration of that process.

Essentially then, we have 1,000 billion of tonnes of CO2 credit remaining for the next 80 years.

Transitional levers

That’s the scale and timeframe of the challenge and one with which governments, regulators and responsible investors are increasingly in tune and around which many are forcing the ESG (environmental, social and governance) agenda.

How do organisations react? Essentially, we as a society have two main levers: adaptation and mitigation.

Adaptation refers to adjusting to climatic stimuli to moderate harm or to exploit beneficial opportunities. It includes all the range of activities (management, technological, institutional, investment, risk transfer) designed to encourage society to cope with and build resilience to changing weather patterns. It will require organisations to assess future potential states to map their own transition journey.

On the other hand, mitigation is the human intervention to decarbonize the economy by reducing CO2 emissions.

With humans themselves acting as a climate change feedback mechanism, the art of managing effective climate transition will need to balance relative costs/benefits in the short and long term between adaptation (managing with a changing climate) and mitigation (managing our remaining emissions budget).

In this Anthropocene journey we are in, transition is the unifying thread that will ensure this human epoch succeeds in keeping its head above water.

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