Ep43: Nigel Topping 'Racing to Zero'

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Michael Liebreich: Before we start, if you're enjoying these conversations, please make sure that you like or subscribe to Cleaning Up. It really helps other people to find us. Hello, my name is Michael Liebreich, and this is Cleaning Up. Our episode this week is brought to you by Eurelectric. That's the association of the European electricity industry with over 3500 members in 34 countries spanning everything from generation, through distribution, and supply of electricity, and whose Secretary General Kristian Ruby was our guest on episode 34. Our guest today is Nigel Topping. He's the High-Level Climate Action Champion for COP 26, the climate conference that takes place in November in Glasgow. He's also been CEO of We Mean Business and Secretary General of CDP, formerly the Carbon Disclosure Project. Please welcome Nigel Topping to Cleaning Up. So, Nigel, thank you very much for joining me here on Cleaning Up.

Nigel Topping: Great to be with you, Michael.

ML: Let's start with COP 26. That's the big climate conference, which was already delayed one year but is going to take place in November this year, unless you know otherwise. You are a High-Level Climate Action Champion for COP 26. Can you tell the audience and me, what does that mean?

NT: Well, the role was created in as part of the Paris Agreement five years ago, in recognition by the parties to the UN Climate convention, the countries that this is such a big deal that countries can't do it on their own, and that they wanted somebody to, in parallel to the multilateral process, to be working to drive what they call non state actors. So, to you and me, that's mainly private sector, local government and civil society. So everyone who's not got a seat at the table, to raise their ambition and drive action and in so doing support faster action by the countries. So that's my job is to generally to push everyone to go faster.

ML: It's a fabulous vision. But you know, Monday morning, the first thing when you sort of got into that role, what on earth did you do? I mean, where do you start?

NT: Because you never come into… I mean, they work had existed for five years, so I didn't come into the blank sheet of paper. And I worked very closely with Gonzalo Muñoz who's the Chilean high-level… president of COP 25. And the current presidency, they hand over to Alok Sharma in November. And he had done something really interesting with this big community of business and city organizations to publish a whole series of pathways to 1.5 degrees, net zero pathways. So, what we've basically done is we've done a second version of those, and we've launched a big campaign we call the Race to Zero, really just to try and normalize getting to zero, with the appropriate short-term actions as the thing which everyone is doing in support of the ratchet that is expected out of the Paris agreement from countries.

ML: So, I remember back in Warsaw before Paris.

NT: COP 19. Yeah.

ML: COP 19. Yes. And the Polish organizer, the Polish presidency, invited business. And everybody said, oh, it's just going to be a whole bunch of coal companies and this is completely ridiculous. These people should not be in the room, business should not be in the room. So, things seem to have moved on since then.

NT: Yeah, actually, there was a very interesting meeting in Warsaw and in COP 19, 2013 right, where the then Secretary General Ban Ki Moon invited a group of about 120 of us who have either business leaders or people working with the business and investment community to basically say, we're not going to change the legal process. That's a negotiation between nation states, but we have to have the constructive voice of the other major forces in the world in the conversation. So, Warsaw was the beginning of opening up and then Peru, the next year, really welcomed in those leadership and that led to the creation of the role that I have now in. This gradual opening up of the conversation to recognize that it's going to take the whole of society, national governments can't do it on their own.

ML: So, Nigel, how many COPs have you been to? I've been to… I'm going to say three or four. I was in Copenhagen. I was in Warsaw. I was in Paris. I'm trying to think… Bonn. So how many have you been to?

NT: Probably about 10. The first one I went to was Copenhagen. Remember that? So I'd recently moved from a 20 year career in the private sector. I was working at CDP, I was really excited to go to my first international climate negotiations and was rather disappointed to find that the organizers couldn't even organize people getting into the conference facilities. I spent eight hours in sub-zero temperatures, in a sort of post-apocalyptic scene from a dystopian film, not getting in despite having all the accreditation, which was a bit was a bit worrying, perhaps that was a symbol of what was to come in Copenhagen.

ML: Yeah, so I remember I went to Poznań, actually, the year before, that was my first. I went to five or six of these things. And in Poznań, I had no idea what to expect. So I turned up and I got in and I was accredited. I can't remember quite how, so I went into one of the negotiations. And I kid you not they spent two hours discussing the agenda for a meeting where they would discuss something called Red Plus, which has to do with forestry at some other point in the proceedings. And I'll tell you what I did, I went back to the hotel, and I did some proper work for two days… I gave up. That was it, done. That was my whole first involvement with COPs.

NT: Yeah, I mean, I wouldn't dismiss that as non-work when they're trying to get consensus with over 190 countries on something that's as geopolitical as the energetic basis of the global economies, about as complicated negotiation as you can imagine, it's remarkable given the political nature of that and the consensus requirement that we got the Paris Agreement, which I think I wrote about it a year after that, that in 30 years’ time, if the Paris Agreement is successfully implemented, and the ratchet process keeps going, and then 100 years down, we'll look back on the Paris Agreement as the greatest ever treaty between nation states.

ML: I think Paris was a different world. And we had on this program, Christiana Figueres who talked about how she turned it upside down, instead of saying some top down, we'll have a carbon budget, and then everybody will share it out, big argument, and then we'll spend 50 years implementing, it's this kind of bottom-up coalition of the willing, and I think that changed everything. For me, as a private sector commentator, it went from being, you know, this is an attempt to build world government, it's going to fail, you're gonna have absurd… one of the other things Poznan was we had these huge discussions about the comma, and what did the comma mean, and it was just days and days about a single comma. And I think Paris really opened things up and changed the weather.

NT: I agree, I think there are three genius bits of the Paris architecture. One is that that's flipping from 196 countries trying to negotiate everybody else's fair share, you know, if you just look at the combinatorics of that it is doomed to fail, to that bottom-up, which is a risky move. Right. And I know Christiana didn't expect to have anything like the number of national plans turn up in time, but it was strange, in a weird way, it looked like a lowering of ambition, but it was an empowering of ambition. The other thing was the welcoming of the non-state actor community into the conversation, which changes the dynamic. And I think the third thing is that there are redundancies built into the Paris Agreement. For example, there's not just the bottom up nature, but there's the ratchet. So, you get to you get to have a second and a third attempt. But also there's, if the politics of a country mean you can't improve the short term, you also have to submit a long term strategy, which seems to have different politics, it's very cleverly constructed to be really quite robust against the normal cycles of politics, most of them, you know, the previous US incumbent notwithstanding.

ML: No, I agree. I mean, on the previous US incumbent, the funny thing is that when he announced he was going to pull out, I immediately wrote that that's probably going to strengthen the architecture. And I think that's what we've seen.

NT: I don't know, I think, it gave a kind of license to be less collaborative, less multilateral, to other actors. And I think that, and I think certainly if, if Trump won again,

ML: A few of them but it also it really gingered a whole bunch of others to lean in. And, you know, we had far more response from cities and from a lot of society, and a lot of countries that just said, you know, and look at look at the role of, you know, look at the, in a sense of closeness on climate between Europe and China, which then, of course, in you know, I think a lot of the US actors that looked at that and said, Hang on a second, this is really dangerous.

NT: Yeah, I mean, I totally agree that the non-state actors in the US, businesses, cities, investors, schools, universities, states, had that whole campaign ‘We Are Still In’, which is now turned into America's All In, we had hundreds of businesses writing to administration saying, you better come out with a nationally determined contribution, a plan that starts with a <inaudible> it needs to be at least 50%. I also think the other thing that's changed you mentioned China is in the last five years, everybody's realized this is not just this is not a green issue. This is a fundamental competitiveness issue. I always use the example of Detroit in the 70s. You know, arrogantly getting reading the tea leaves wrong in the first oil prices and thinking that they could still, you know, operate in a seller's market and as a result of which there's lots of Asian and European, smaller, more efficient cars on American roads even 50 years on from that.

ML: I totally agree. I've been saying for a long time that climate is all about, it's actually industrial policy and trade policy. It's not environment. One of the problems is, of course, it's been located within environment ministries who are generally not powerhouse ministries, you know, with some exceptions. And it's all about it, you know, it's between industry, trade and Treasury, the finance ministries, that this is going to get done. So, COP 26 is coming to Glasgow, and we've established that I've been to five or six, and you've probably been to 10 of these things. Can you talk us through because our audience, they're all you've got to assume they're all smart, and they're all engaged, but they don't know the ins and outs of all of the technologies, etc, but also all of the negotiations and the way that the COP… And what happens what, what happens in a normal COP, because we also need to talk about what might happen at Glasgow because of COVID. But let's do a normal COP first, between all of these different 30,000 people who rock up, what do they do?

NT: Well, the first thing to say is that even a normal Glasgow, without COVID, would have been exceptional, because it's the fifth COP after Paris, and Paris setup this five-yearly promise review ratchet process. So, the reason there's so much tension on Glasgow, is that it's the first real test of the Paris Agreement. And that's COVID or no COVID.

ML: I get the sense that countries are now supposed to ratchet. They're supposed to say, Well, five years ago, we said we could do this, but now we've got technological process, you know, progress has happened. We've put legislation in place, and we think we can do more. And they're all supposed to say they can do more, right?

NT: Yeah. And I was, but I think there's three elements of the test. I suppose it's a test of the multilateral system, like can countries still come together and deal with those really complex negotiations you talked about, and some of the Paris rules or the Paris rulebook have not yet been finalized. So part of what needs to happen in Glasgow is some of those very detailed, very important to business, on transparency, on timetables for reporting between countries. Now, the kind of things that, you know, everybody in the private sector will recognize as being crucial, like, you know, when do you have to report your results in what format to your stakeholders, it occupies a lot of… time. So, there's still some of that technical negotiation, which is crucial, maybe not so materially, economically, but in terms of faith in the multilateral system. Then there's the ratchet process. Is the Paris mechanism working? Most of that we’ll know before Glasgow, because of course, we've already seen there's new plans, the EU 55%, the US 50%, the UK 68% reductions by 2030. So, I think you can make an argument that the ratchet brokered process in terms of mitigation is working, we haven't heard yet from other big, big economies and countries like India and China in terms of their plan, that the signals are strong. I mean, there are other elements of ratchet like finance from the Global North to the Global South, which is less strong so far, and focused on the need to act and to build resilience, given that we've already got a lot of extreme weather events locked in. So the second bit is that are the country stepping up enough? And the third bit is, is the real economy moving enough that does this start to feel like things are really happening in markets and economies and in our daily lives. And I think each of those has as its own sort of bar of whether people decide that Glasgow has been a success or not. And you have to, I think, for Glasgow to be seen as a success, you'd have to see progress on all three of those.

ML: It's an interesting one, because I think that Glasgow is already a success built in from, because you've got all of these net zero pledges that cover something like 80% of the global economy by 2060, if you include, you know, most countries 2050, China and Brazil 2060. And so, if that gets if those get translated into a nationally determined contributions, which is just the kind of the delivery of a report, you know, and so on, then it's going to be a huge success, because it is so far beyond even Paris. And the rest of it. I mean, Article Six, and all this stuff about that, you know, all the rest of it. Does the average person really care when, do they even notice that stuff?

NT: No, I think the average person doesn't really care. But the majority of the countries who are part of the multilateral process do. Remember the majority of countries self-identify as climate vulnerable? In other words, yeah. And the climate injustice of, we didn't cause it, you did. We’re suffering from it more than you are, is at the heart of the politics, which is why things like the commitments on finance and action on resilience are as important to many countries are more important than the net zero. So I think it's possible that this is a net zero COP, but not a success because of that. So, I think you're right, that we're making huge progress in terms of net zero becoming a North Star. I mean, the question really is are the short term plans up to that ambition. But for the majority of countries who are parties to the Paris Agreement, it's about more than net zero. It's also about finance and resilience.

ML: It is I just, I suppose I come at it, you know, perhaps from a different, you know, a slightly different perspective, private sector. And also, but politically, I'm not as… I don't come at it from a tradition of, you know, of social justice nearly as much as others. I mean, I'm very committed to that. But, you know, as long as the big economies are on track…, you know, committed to net zero, and that comes out of Glasgow, looking credible, you know, will there be some other countries, you know, running around, saying, oh, it's not enough, and it's not legally binding, and nobody wrote me a check, and, you know, and so on. I mean, in some way, I don't think that that's going to cast a shadow over the huge achievements of moving from Paris to Glasgow, I just can't see that really being an overshadowing thing that could cause it to be regarded as a failure, if I'm honest.

NT: Yeah, well, I think I beg to differ. If you think about the context, we have in terms of COVID vaccine diplomacy and fiscal pressure on a lot of middle income and least developed countries that I think how well the global system is coming together in solidarity in what is effectively a post-war moment, economically now, you know, do we have the equivalent of a Marshall Plan approach to refloating the whole economy? Or do we have a bifurcation? So, I think it's not a it's not a done deal by any means. I think, Michael,

ML: I just think it's a difference between you know, what the Guardian might say, this is all absolutely tragic If we miss this opportunity and that opportunity, but if, as far as I'm concerned, if the billions and then trillions are flowing to the solutions in the big emitting economies, that is, you know, that’s the key to success, in my view, not to minimize that. And certainly not to minimize the suffering coming out of COVID, which is, which is just as we're seeing in India. Yeah.

NT: I think it's both. And so I mean, it's one reason why as well as the Race to Zero, we've also launched a Race to Resilience.

ML: Absolutely both and would be the best of all outcomes. And but I do think I just think we're going to see a success. The question is, is it a both and success? And, of course, we move straight into the kind of can we deliver this stuff? Because there's no point in the commitments in the end and the nationally determined contributions, the plans are worth nothing without execution?

NT: Well, I think I think that will be really, under the microscope in Glasgow are the commitments from the public and the private sector turning into plans in a credible way? It's also worth in terms of getting it done, it's also worth remembering that, you know, most of the infrastructure that's gonna be built in the world is going to be in the Global South. In the next decades. Yeah, most of the urbanization, most of the new grids, most of the new ports. So, it does matter how they're done, not just in the high emitting countries, but in the, in the growing economies in the global south. So, it gets some. Yeah, it's complex.

ML: I want to pick you up on one thing that you said, which is that you had this 20 year career in the private sector. And you were working with an aerospace company was it?

NT: Automotive, so worked in Lucas, which was, you know, was one of the bastions of British engineering and it when I was working in the 80s and 90s. That was aerospace and automotive.

ML: So you were mainly on the automotive sector, you were a factory manager, you were an operations director. And then what happened? Because you now I mean, obviously you’re now the High-Level Champion for Climate Action, and all the way from 2007  you've been completely dedicated to climate action through the Carbon Disclosure Project, now CDP, through We Mean Business, the Race to Zero, the Climate Action Champion… What happened to you in 2007? I mean, was this just an epiphany, you know, this is your background before then that I could well…

NT: You need to look at this and look a bit closer. I mean, to two things really, I would say. One, I've always been an outdoorsman with a particular fascination for the polar regions, I spent a lot of time climbing and ski touring in Iceland, Greenland, Patagonia, as a young man. And that's in 1987 came across the stark impacts of climate change when I was supposed to be doing some scientific work on the snout of a glacier, which to cut long story short wasn't where it should have been because it retreated by 20 kilometers. It was like, if you're a young mountaineer, you know the map is the truth. So, to come to a point on the map, where a massive object like a like a five kilometer wide glacier is not there, but there's just water. I mean that maybe it was an epiphany, that sort of deep down I never had any question about believing this was real. And then what actually happened in 2006 I was part of a team that bought out and built up TMD Friction which is the biggest manufacturer of brake pads in the world. And then I was on the exec co, working very closely with the CEO and the CEO and the Chair decided to part company. So, I went with the CEO. And then I didn't know … and I've been working there for 10 years, I didn't know what to do. So, I spent some time thinking. And then that sort of brought the sort of if you like, the environmentalist in me, or the wilderness lover in me together, I felt like because I met, I kept meeting environmentalists who were like your business is the problem or greedy business people or interest bearing debt. And I was like ‘really?’ And really, if you want to start a business, you need interest bearing debt, you know, if you want… everything that you're using to run your campaigns is produced by business. So, I don't think business is a problem. I think maybe the way that we're directing the markets is the problem. So, what I'm really fascinated by is how markets can serve society rather than the other way round. So that that's how I ended up doing this work.

ML: Okay, now that's fascinating. I did not know that you are a ski mountaineer, a ski tourist. I've ski toured to Mount Elbrus, Europe's tallest mountain. So, I think we're gonna have to have, we're gonna have to talk about the ski touring. But now we will go off and spend, okay. Who knows, the audience might prefer us to do great ski tours we've been on but I will tell you that the glacier as an epiphany, so I was actually cross country skiing, I did the Engadin Skimarathon and I brought lots of people to do it for charity. But I went up one side valley from Pontresina one year, this would have been about 2002, 2003, just as I was thinking about what to do with my sad, wretched life having been spat out by the .com, boom, bust. And I went up this side valley, and I saw a sign saying 1832, and I thought, well, that's probably the altitude. And then I saw a sign saying 1855. And I thought, well, that's odd, because it's been flat, but maybe it's the altitude and then I saw 1870, and then 1910 1920. And so… and these are the years when the glacier reached that point of the valley, and I was ski tour… I was not ski touring, I was cross country skiing, I went on and on and on. Kilometers, through the through, you know, forests and whatever, and eventually got to the snout to the glacier, which was now absolutely kilometers further away. And that was one of the sort of foundation stories behind my, you know, commitment to New Energy Finance.

NT: Well, you know, I won't go into detail, but I went with Johan Rockström, in a group to the Swedish Arctic a few years ago to the oldest glacier research station. And the highest mountain in Sweden has two peaks. And two years ago, what was the highest mountain, which was glaciated, became the second highest mountain. So, I mean, it's so that all the books are wrong, that the north peak is now the second highest.

ML: And there are plenty of plenty of normal climbing routes in the Alps, you can no longer do because rocks fall, and you just don't have the time to get past safely, and so on. So, you probably know that already. But so, but I do think that these kind of epiphany stories are very important, particularly, as we both come out of the private sector, very private sector. That because so much of what's happening now, you look at all this ESG, you look at sustainable finance, is about other people, frankly, having these epiphanies and then trying to integrate it into their work life, but maybe not by saying, oh, well, I'll give up everything and join the Carbon Disclosure Project or start an information provider about, you know, low carbon energy, but they're having to do some quite difficult work to integrate it into what they do every day. And I guess that's what you're championing is kind of all about.

NT: Yeah, the thing that surprised me when I made that change was, you know, I kind of, like many people do work in the private sector, but I've never worked in any other sector assume that all of the innovation and all the entrepreneurial behavior was in the private sector. And because if you work in a big company, there's just not that much space for entrepreneurial behavior. Okay, we bought out a company and grew it, so there was a fair degree of entrepreneurial behavior there. But the most on most entrepreneurial work I've ever done in my life has been in not for profits, I mean, growing CDP I joined when there's about 10 of us, CDP is now more than 450 employees. And it's quite an important part of the global infrastructure. And We Mean Business, you know, we founded from scratch, it's like, it's so intellectually and entrepreneurial, I've actually had more fun in these kinds of roles. I guess. now I'm sort of entrepreneurially trying to bring about global systems change. That's quite an intellectual challenge as well.

ML: Not ambitious at all then…

NT: One of the things one of the people that really know me know that I'm quite, I don't know, I'm, you know, just maybe a background as a competitive sports man, but I'm, I am really, I am really ambitious. So and one of the things I love about this role is actually the role is to be pushy. So I can turn up say, sorry, but it's my job. I have to push you to be more ambitious than you already are. So that's quite a lot of fun.

ML: I'll tell you there is I think a whole media opportunity for somebody to look at competitive sports people who've gone into NGOs, but particularly into climate environment, because you're a rugby player you’re rugby blue, I discovered researching for this. I also have my skiing background. But they do pop up the Olympians, and elite sports people, they do pop up. And sometimes you don't even realize you don't know for you know, I kind of wear it a little bit on my sleeve. I want to shift to the energy system, and the players there that you're working with. Because this episode of Cleaning Up, uniquely, it's the first time we've done this, has been sponsored and enabled by Eurelectric, which is the association of all the different players in the European electricity industry. Now, we had Kristian Ruby on Cleaning Up. It was Episode 34. So, it was a couple of months ago. And I asked him, What percentage of the world's energy system is going to be electricity? It's currently about 20%. And I was rather surprised that he said, 60%, he didn't say 100%. He didn't say electrify everything. Because there are some people who say electrify everything and they make then electricity zero carbon. how deeply are you in those sorts of debates and discussions?

NT: I mean, a lot of what has informed my thinking about the energy transition was through several years on the Energy Transitions Commission, I think mostly … I was there from the start, but for you, I just stepped down when I took on this role. But it goes into all that research onto the energy transition, and then on to the hard to abate sector transitions, which of course, is part of the puzzle, right? So, I think, for me, the really interesting thing is just how quickly, even people who've been experts in sectors, you know, have been in a sector for 30 years, how quickly, given exposure to the facts, people can change their minds? I mean, I think you've written I'm interested to hear your view on hydrogen, I think you've written it… are we in the third hydrogen bubble or just the real deal this time? But certainly one thing I saw with CEOs from power production, grids, you know, hydrocarbon sector, and materials which have huge energy demands, a gradual sort of epiphany, as, as people realize that, yes, we're gonna have to electrify the hell out of everything. So that, you know that is massive, which means that there's kind of no regrets to building more generating capacity pretty much right now. But also, that there's going to be a really significant role for hydrogen, for green hydrogen, which of course means itself means more like more electricity. So I’m interested: that 60% of you count the green hydrogen is because the green hydrogen is really electricity?

ML: Yeah, so I count green hydrogen would be electricity, because you have to, you have to go through the electricity stage. And when you asked me to sort of what do I think it's a hydrogen, the third hydrogen bubble after the sort of the 1980s and then there was the 2000s. Are we just every 20 years, we have a hydrogen bubble, it's very distractive, distracting and destroys capital. I actually think we're kind of in half the hydrogen bubble. I think that hydrogen in obviously, replacing the grey hydrogen with clean hydrogen, green, or blue or pink, which is what they call hydrogen from nuclear. And I think then the hydrogen will go into other things. So it will not just do currently use hydrogen mainly in ammonia, so fertilizers and in petrochemicals and plastics and so on. But I think and that's all at the moment, dirty hydrogen, grey hydrogen that will change to clean, but I think hydrogen will go further. It might do steel, it will almost certainly do some form of efuels for aviation. There's a few sectors where it's…

NT: Shipping probably?

ML: Shipping. Yes, probably. I'm a bit worried about shipping everybody's in love with ammonia at the moment. Ammonia is a nasty substance, by the way, but so I'm 90% with the ammonia fans.

NT: Petrol’s not that nice a substance, is it?

ML: No but it doesn't leak, it doesn't instantly to blow up your lungs, which anhydrous ammonia does. I've got to get my head around what the options are there. But you know, but if it's not hydrogen, then it's probably something like methanol, so it'll be an e-fuel, I don't know. And then hydrogen, providing deep resilience. We've got to have, you know, you said race to resilience. We've got to, I think, talk much more about deep resilience. Getting through two weeks, three weeks of no sun, no wind or big interconnections falling over between electrical grids and stuff that we're not really talking about, and we're not ready for. And I think hydrogen, because you can store it in salt caverns and so on, it might play a big role, but hydrogen in transport, land transport and hydrogen and heating, even industrial heating. I'm very skeptical about.

NT: Even though some of the vehicle manufacturers seem to be you know,  Daimler and Volvo have got a joint venture, they seem to be betting on top end.

ML: So what Daimler and Volvo have done is having tried to get hydrogen fuel cell cars going and the hydrogen that… what they've actually done is taken their IP and dumped it into a JV, which is usually you know, you’re private sector guy, you don't put your crown jewels into a JV with one of your competitors. So, I actually think that that's a side bet. What's actually happening, what they are doing and they are marketing is, is electric trucks. And I think we're gonna see that, you know, that we're gonna see them, how could I put it in a roaring off to the horizon, and the fuel cell stuff will just, I think, probably never happen even in long distance trucking.

NT: Interesting. I think the jury's still out there. But I don't have a strong view, either way. But I do think it's interesting how fast the trucking sector has committed to getting to zero using the agreement in Europe that all the truck manufacturers in Europe have committed to 2040 phase out combustion engines. And it's funny that the Commission is still talking about 2050. So, things are changing so fast. If you've got a long policymaking cycle, you almost can't keep up with the same thing. Same thing with businesses, right? If you're long R&D cycle, you can't keep up with the pace of change.

ML: Yeah. And I think what they've what they've seen now is we're starting to see that experience curve in batteries coming down there, and they've all looked at the supply chain, that critical minerals, you know, rare earths, lithium, you know, copper, nickel, even cobalt, and it's sort of saying, well, you know, the cut, there are no showstoppers, and the costs are coming down.

NT: 20% a year, right?

ML: Well, I it's, it's 20% per doubling in cumulative volume. So, it's not quite a year, because that would suggest it keeps going linear, you know, at the same rate over time, but it's, yes, fast. There's costs coming down very fast, you know… And I think that's the beauty, to link it back to the COP process, that's the beauty because they would never have made those commitments. the trucking industry was not making those commitments back in 2015. But it's able to do it in 2021. And then, of course, at the national level, you feel empowered, I suspect as a negotiator to make a bigger commitment.

NT: I mean, I think this is a classic example of systems change. I mean, I think of that EV changing. You had disruptors like Tesla, but you also had cities like London and Paris saying we're gonna have ultra-low emission zones that then you have, then you have SMEs delivering into London, saying, yeah, but where are the electric trucks. So then you have you know, that you have demand signals going to the Daimlers and Volvos of this world, of course, all the while you've got the batteries costs coming down. And then in the UK, I think it's only two years between 2040 phase out date. And then they go and then consulting on a 2032 to 2035 phase out date, when most of the private sector said, the Energy Transitions Commission, WeMean Business, even the oil majors said don't mess around with 2032 to 2035, bring it forward straight to 2030, because that'll give us the clarity to invest into because we know it's going to die sometime in the 30s. So I think that's been a really interesting example of just how fast things can change but all those different actors playing a role.

ML: Although there was a little rearguard action I, I had a bit of fun. I caught Aston Martin and Robert Bosch, pushing a little leaflet that said, oh, we mustn't write off e-fuels, e-fuels for cars is the stupidest thing. There's the sheer amount of electricity you would need to generate to make the hydrogen to capture the carbon to combine them to… you know, and then you get this horrendously inefficient combustion engine in the car, which of course wastes you know, 80% of what you stick in the car.

NT: I just, I just think it's a total fantasy. I don't understand it. When you when you look at those costs coming down, and everybody agrees that we're going to reach sticker price parity within the next, say, three years. Even if you think that's a stretch, and it's going to be six years. Why would anyone buy a combustion engine car when it's more expensive to buy more expensive to run doesn't last as long by then isn't as cool and sexy, which is what cars have been sold as? I just think it's a fantasy bet. And I can't I think this exponential is gonna increase and that would be a game over combustion engines very soon.

ML: And so the role of utilities in all of that, you know, I have to confess, and I talked about this with Kristian Ruby when he came on the show. I was amazed that the European utilities that they have, the fact that he chose Kristian, who comes out of a wind, the wind industry background, but the way that utilities in Europe have sort of, you know, they just embraced this agenda. And now it amazed me. And I was, I've always wondered, you know, is it just because they saw, Oh, electric heating, electric cars, this is cool. This will provide our, this will drive up our revenues, do you think it's that or something deeper?

NT:

Well, I think it's a mix of just, like straightforward self-interest, I mean, unlike, say, oil and gas or automotive, where you've got to completely flip the technology at the heart of your business to survive. Once the utilities had realized that we're gonna have to do that in terms of renewables, which I think it already happened, I think then there was a sort of epiphany, like, oh, my God, everyone else is gonna have to electrify the hell out stuff. And that's, you know, we're going to be at the heart, and we're gonna play in new industries, like suddenly we have a major role in transport, which we had no role in before. So I think it's a mixture of having gone through the disruption earlier. And so you had what I think when Eurelectric really changed, it was when it had like Enel and SSE and Orsted, as chair and co-chairs, and suddenly went from being a normal trade association, which is kind of trying to slow down policy change to being a front foot policy organization saying no, let's go faster, let's go faster. But I think I mean, I think they're able to do that, because it's such a positive story for the sector, right?

ML: Well, one thing I do find interesting is, if you look at the question of gas, gas as the bridge fuel. That argument used to be made by sort of all of the incumbents, but more recently, it's only made by oil and gas companies and pipeline companies, you just don't see utilities, saying, you know, wait a minute, we've got to have gas, gas is good, you know, none of them are promoting that line, which is, I think, is you know, and these are the people who presumably know most about what the future holds in the electrical sector, and you don't find transmission grid operators say, oh, we're very worried about resilience, we really need the gas, the gas, gas, gas, gas as a bridge for you. That's not what they're saying,

NT: No. And again, I think, because they can see they've… that's probably the sector that furthers through its own disruption. Right. And so and so that's actually it's got, you know, if you think about 20 years ago, that electric utility industry was a very old industry, nothing had really changed much for a very long time. Like many sectors like really fundamentally oil, you know, oil and gas, automotive, the same basic business model. But electric utility starts with the first of really, really disrupted. I think having, having survived that those leaders who basically became the leaders of Eurelectric, whether it were people like Francesco Starace, actually who had who had led the kind of green revolution within his own business and was then promoted to CEO of the whole business. Similarly, of course, Orsted and SSE. So, I just noticed last week that Uniper have just wanted to invest in a big LNG terminal in northern Germany had just scrapped that idea and gone for green hydrogen and ammonia infrastructure instead. And recently, the World Bank and others have basically poured very cold water on the idea that gas might be a bridging fuel for shipping. So, I think lots of people… that, yes, I think you're right, it's a classic sort of fight between an incumbency, which is stranded assets, and an alternative provider who doesn't see any need for those assets.

NT: But then you still got North Stream 2, you've still got the attempt to bring a big gas pipeline from Russia, to Germany. You've got Belgium, shutting down its nuclear, and building three or more new gas plants, and Germany, if they complete their nuclear early shutdown, it's almost inevitable that they will be burning more gas, at least in the short term, short term being a decade? 5,6, 7 years? So, are you are you also in your championing? What do you get engaged in… How can I put it, the difficult cases? You know, do you sort of just spend your time hanging out with Francesco Starace? You know, if he's listening, I've got to get him, Francesco, if you’re listening, I’ve got to get you on to Cleaning Up. You're such a visionary. But do you hang around only with people like that? Or do you also get sort of sent in to talk to the difficult cases?

NT: Well, to be frank, what I'm asked a lot of my time trying to point to the inevitability of the transformation and what is already happening on the ground. So, I'll focus on things like last week, like Moody's, on the back of the 70 trillion of assets behind the Glasgow Financial Alliance for Net Zero saying there's a credit squeeze coming here for heavy emitters who haven't got a plan. Or the Uniper announcement because they're pointing to change, media tend to be not so good at pointing to early signs of change, once things are going mainstream, but gas is a good example something where I realized in the last year that actually, we don't collectively have a shared sense of the future. And the role of gas as a transition fuel or not, or to what extent is something that we have to get our heads around. So it's something that, you know, I just started looking at. All I know is there's some very strong opinions in different directions. My suspicion is that there's a sort of incumbency, holding on, playing a bit of a King Canute role because that's normal. And technology will drive that transition faster than people think. But the question is what is that transition? What does it look like? I think it's something we've got to get a collective head around, I think it's to make these kind of transitions, it's really helpful if we have a shared sense of what they are, not just total chaos. And I don't think we have got a shared sense of that at the moment.

ML: And do you think that the weather is changing on nuclear in the developed world, I mean, obviously, China has remained committed, Russia has remained committed, India has remained committed, the Gulf region is starting to, you know, it's commissioning the Barakah power station and a few others. But it's been very troubled in the West, but do you think that the mood is shifting? Do you think there are now more people understanding that these things just produce huge amounts of low carbon electricity, and at least we have to maintain the ones we've got?

NT: I think that at least we have to maintain the ones we got. Which, by the way, I've always struggled to understand Germany's logic of, you know, rapidly shutting down nuclear power stations that were not in a tsunami risk, as far as I'm aware, which, of course, has led to burning, you know, brown coal for a lot longer than they would have had to. So, I think keeping nuclear power stations running, what the assets are already there, my sense is that that's where… not everybody, of course, some people just ideologically against nuclear… but the assets are already there. I think there's a strong sense that keep them running as long as safely possible. And I think that the argument for new nuclear increasingly seems to be one about cost, right, Michael? I mean, I don't know how much it's gonna cost. It was 92 strike price index linked, it's probably 105  already, you know, it's multiples of alternative sources. I do think some of the I mean, you'll know more about this than I. And you know, what really, is the potential for floating wind, what really is the potential for North Africa to be a massive supplier to Europe via undersea DC cables? You know, when we start thinking bigger about resilience? What are the other plays? Nuclear might be one of them and I know there's work going on a small modular reactors, but I guess, I don't know, I don't know how close that is to being executable about or how early that is, in terms of the that doesn't seem to me like it's something for the next five years. But maybe beyond that.

ML: That certainly, just to translate them, you use some numbers with respect to Hinkley. It's $140 per megawatt hour. So, if you go into dollars, you're quoting numbers in pounds. And at that price, you know, they're just lots of other ways to do things that are that are cheaper. But these are really big discussions. And I'm a big fan of, at the moment, I should declare, I've got a tiny angel investment in something called XLinks, which bring in North African solar and wind buffered through batteries, so dispatchable, renewable energy into the UK, electricity into the UK at a sort of 40 or 50 pounds per megawatt hour.

NT:

So half the cost of Hinkley and the same sort of scale as a nuclear…

ML:

And dispatchable as well. Yeah, but these big these big chunks of discussions that we have to have, I guess my… I would ask again, whether those are things that you, with your COP 26 Climate Action Champion hat, you know, because the criticism of the climate, the race to zero or the climate action champions, is that it very much focuses on the developing world, the vulnerabilities, the, you know, transfer of funds from North to South and the UNFCCC overall spends an enormous amount of its time and resource focusing on those issues. But there is another approach which is let's look at the 20 biggest emitters in the world. And let's use Nigel to talk to them and tick off the big chunks…

NT: Actually you're the first person who's criticized me for spending too much time on developing world, so I'm pleased with activity <inaudible>, because I spend most of my time on, you know, big industry, big sectors, big emitters. And how do we…

ML: Nigel, it wasn't a critique of you…

NT: It’s not a critique I've heard before. I think I mean, what we've really been trying to focus on is normalizing net zero, with robust targeting to be as something that everybody has to do, and trying to get a sense of, of convergence on pathways. And I would say, Michael, one of the things that I'm looking to do in the next 12 months, and this will be through COP 26 and beyond is actually shine more light on where there are valid contentious issues, not just unreasonable lobbying positions. And I think, you know, one of my mentors in systems thinking, always says, when two intelligent people disagree about something, it's worth paying attention, not just dismissing. So, if you and I disagree about the role of hydrogen, or the role of nuclear, I would want to double click and say, what are what are the assumptions that we're both making? You know, because it's the future it’s uncertain. So, we'll be making different assumptions. So, I think that we, as we get more sophisticated, this kind of global industrial strategy, which is I always use the example of telephony where we're used to the idea of generations like 4G to 5G, it seems to me like we need to agree the broad direction for the next generation with no regrets, while still debating, discussing and arguing about the generations beyond that. And there are a series of issues like the role of offsets, the role of carbon capture the role of gas, which are all very confusing and contentious. And you could have five people working on climate change at the moment, and you'd definitely get five different views on each of those issues. I think we need to have better conversations about them, rather than just shouting each other from the corner.

ML: Look, I'm delighted to hear that because one of the things I've been working on is something called the Climate Action Solution Centre, CASC, which I put together a little consortium and we've rented some space just outside Glasgow and it's to have exactly those double click discussions where you click in and you do the difficult stuff where there are legitimate uncertainties and knotty problems, so that we get beyond… What we want to do is to create a space where, you know, the CEOs or the mayors who make these wonderful announcements about net zero can then come into a space and say, actually, these bits I know about, but here's a bunch of stuff. I don't know how to deliver what I've just committed. And we'll get stakeholders and discuss that. And I had hoped that maybe we can involve you.

NT: Well, I'd love to because I think we need more of those respectful conversations where we're not just pitching prepared notes or saying how our company was brought and sustainable 150 years ago. And that's less prepared speeches that we've all heard 1000 times it's frankly, boring. And don't help us get the solutions as much as those conversations where we can actually admit that we don't know everything or explain why we have a certain view, because we look at the way we think about the uncertainties. I don't think we need to get much better at having those. I think we are getting better at that. But there's still some very thorny issues that we haven't collectively addressed enough, I think.

ML: Very good. So I look forward to getting you involved in defining and then hopefully getting the stakeholders together to have those conversations. Just finally, COP 26 is not the only thing you work on, because you talked about how you're going to do stuff beyond COP 26. But for COP 26. Final question: optimistic, pessimistic or neutral? And why?

NT: Overall, I’m optimistic for the reasons we discussed at the beginning, just the sheer amount of momentum on net zero, the politics is lining up private sector, capital markets, hugely piling in. My word of caution is about the global politics of climate change. And that climate justice question which is at the heart of the geopolitics of climate change, and whether that makes enough progress in the round COP to be seen as success, I think remains that there's plenty of work to be done there still.

ML: Nigel, thank you so much for joining us here today. It's been a great pleasure. And as always, when you and I talk we end up with more things to follow up than we've been able to cover on the day. But thank you very, very much for your time.

NT: Well, great, thank you Michael. It's been a pleasure. And I look forward to following up especially on the ski touring.

ML: So that was Nigel Topping, the High-Level Champion for Climate Action for COP 26 later this year in Glasgow, talking about his multi stakeholder coalitions in the race to zero. My guest next week is James Thornton. He's the CEO of Client Earth. He's been using his expertise in law to build a team of environmental lawyers to hold governments to account on issues like air pollution and other aspects of the environment. Please join me at this time next week for a conversation with James Thornton.