The greenhouse effect was identified as early as the early 19th century - and largely ignored. We look at how decarbonisation has increasingly come into focus over the last 300 years.
In 1800, when the world population reached one billion, 98.3 % of energy needs were met by a mix of wood and dried manure for heating and cooking, animal muscle for pulling, and wind and water for milling. But as economies became more sophisticated, demand grew for a fuel that could do much, much more.
Coal, mostly mined from exposed surface seams, had been used for centuries, and made up the remaining 1.7 % of the 1800 global energy mix. As demand for fuel soared during the industrial revolution and with the arrival of the steam engine, it became increasingly economically viable to mine deeper for coal.
The black stuff would soon be burned in extraordinary quantities to power rail networks, factories and electricity grids. By 1900, coal made up almost 50 % of the global energy mix.
In the meantime, in the mid-1850s, a former train conductor named Edwin Drake was using an early steam engine to drill into the rock near his home in Titusville, Pennsylvania. After years of trial and error, crude oil began gushing out of the earth one day in 1859. It was the dawn of the oil age, which would soon give rise to the mass production of the internal combustion engine - and plastics.
Between them, coal, oil and natural gas fired up a new global economy and defined the way we live. But a tiny number of people who cared to notice were quick to question the impact of such rampant extraction and combustion. In 1824, the French physicist Joseph Fourier had first described the Earth's natural "greenhouse effect". In the 1850s, the American scientist Eunice Foote and the Irish physicist John Tyndall separately showed how water vapour and other gases created this effect. And in 1896, the Swedish chemist Svante Arrhenius determined that burning coal could enhance the greenhouse effect.
In 1912, the Braidwood Dispatch and Mining Journal, a small newspaper in Australia, published an ominous article about the sheer quantity of coal being burned in the furnaces of the world, and the billions of tonnes of CO2 being pumped into the atmosphere. This tends to make the air a more effective blanket for the earth and to raise its temperature," it read. "The effect may be considerable in a few centuries."
But the work of Arrhenius and others, and the basic theory that humans could affect the climate at all, remained on the fringes of science and politics. For decades, burgeoning economies continued to drill and burn with abandon.
In 1930, the human population had hit two billion. In 1938, British engineer Guy Callendar used records from almost 150 weather stations around the world to reveal a startling truth: global temperatures had risen in line with the CO2 concentrations. He suggested a causal link, which became known as the "Callendar effect". It was a controversial theory, that was then dampened further by the demands of fuelling a world war. But Callendar had started something; the elephant had walked into the room.
Worrying evidence mounted after the war. In 1957, American oceanographer Roger Revelle and chemist Hans Suess determined that the oceans could not absorb the CO2 being thrown up into the atmosphere, as others had assumed. "Human beings are now carrying out a large-scale geophysical experiment", Revelle wrote.
Yet the conversation lacked urgency, and climate change barely featured at the first UN environment conference in Stockholm, in 1972. Meanwhile the world population continued to explode, hitting three billion in 1960, four billion in 1975 and five billion in 1987. In 1988, a year after chemicals that damage the ozone layer were banned, the Intergovernmental Panel on Climate Change (IPCC) formed to gather evidence on climate change.
There was at last a framework in which action against climate change could take place, and a series of pledges to reduce emissions such as the 1997 Kyoto Protocol. But the climate "debate" became ever more politicised as big business - and the fossil fuel companies in particular - sought to sow doubt about the reality of a warming planet and the need to do something about it.
Ecological awareness is as old as man and environmentalism was central to several early religions. It has also risen as a popular response to the effects of fossil fuel burning. In 1306, King Edward I of England outlawed the burning of coal, which, being used as domestic fuel due to a scarcity of wood, was offending the lungs and sensibility of his mother, among other nobles. It was perhaps the world's first clean air act - and it was widely ignored.
Concerns about air and water quality multiplied in the industrial revolution, prompting the formation of the earliest environmental NGOs. Meanwhile writers and activists including Ralph Waldo Emerson, Ernst Haeckel, John Muir, Rachel Carson and James Lovelock highlighted the huge harms being caused to ecosystems and species. The legal concept of animal and environmental rights also emerged.
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Ecology became a global movement thanks in large part to protests against the proliferation of nuclear weapons after the Second World War, which gave rise to such organisations as Greenpeace. Green political parties took root, and environmentalism became a tenet of the counterculture movement.
Activism grew with the belated global action at the political level, and in defiance of the climate denialism that was dominating the discourse. Filmmakers became part of the movement, celebrities became figureheads and activists became celebrities. Younger generations became environmentalists by default rather than choice, heaping pressure on politicians and corporate leaders to pull their heads out of the sand.
Decarbonisation has become a vast and shapeshifting attempt to, at its core, limit the amount of CO2 in the atmosphere. Technology has become a major part of the picture, from the widespread but not always smooth transition to electric vehicles to the emergence of renewable energy as a viable alternative to fossil fuels. While progress remains slow in large parts of the world, few would have believed at the start of this century the extent to which many nations now rely on renewable energy. For example In the UK, the birthplace of the industrial revolution, 58 % of electricity in 2024 was generated by clean sources.
As a result of the economic infeasibility to completely decarbonize every sector, technological advancements have also given rise to direct air capture and storage, a method for technologically removing CO2 from the atmosphere and storing it as well as carbon capture and storage, a method for capturing CO2 at point source ("chimney") and storing it. Storage techniques include the pumping of the gas into the ground to turn it into rock, as well as its burial in depleted oil and gas reservoirs. Even though it’s widely accepted that these practices are necessary to reach a net zero economy, they are sometimes controversial, partly because they require large amounts of energy and are difficult to scale. Direct air capture and storage as well as other carbon removal technologies are also tied up with the fraught business of carbon credit trading.
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The need for energy storage has also grown in tandem with huge increases in sustainable energy production. From the domestic to the national infrastructure level, battery storage systems have mushroomed to capture energy and reserve it for later use, helping to smooth out the natural fluctuations in supply caused by, for example, seasonality and the vagaries of wind and sunshine.
As political momentum has built around international conferences such as the Conferences of the Parties (COP) of the United Nations Framework Convention on Climate Change (UNFCCC), which have grown in prominence since they started in Berlin in 1995, governments and industries have raced to meet tightening emissions targets. Buying credits to offset rather than cut emissions is often the only way to get close to achieving those goals.
The US introduced a national emissions trading system in 1977 in response to protests from industry and market economists against regulation. Similar experiments unfolded in the 1980s. The 1997 Kyoto Protocol formalised the concept on an inter-governmental level when it introduced mechanisms for nations to engage in carbon-trading, including the Clean Development Mechanism (CDM), where developed countries could buy credits from projects in developing countries. The 2015 Paris Agreement cemented the role of market-based offsetting to achieve national climate targets.
But carbon markets, which include UN-based global markets between nations as well as voluntary carbon markets used by companies, governments or institutions, have proved volatile, variously crashing or lying open to abuse. In 2022, a UN report called for "zero tolerance for net-zero greenwashing", warning companies against buying cheap, low-integrity credits rather than making their own emissions cuts. Greater scrutiny and concerns about integrity has worried investors, contributing to a steep decline in the total value of carbon credits, which fell from USD 2.1 billion in 2021 to USD 723 million in 2023, according to Ecosystem Marketplace.
Other strategies for decarbonisation include the more general concept of "green growth", or the drive to decouple the basic need for economic growth from the kinds of natural resource plundering and associated emissions that has traditionally allowed economies to flourish. It in part counters the critical narrative that sustainability is inherently bad for the bottom line, setting out to place green measures at the heart of future policy making around everything from the jobs market to infrastructure development and construction.
Underpinning much of this progress has been a wider evolution in regulation and policy as nations decide what measures are necessary - or at least politically viable - if they are to stand a chance of meeting global climate targets. Typically, this requires a mix of carrot and stick, from incentives such as subsidies to taxes related to sustainability.
The year 2025 may turn out to be pivotal in the increasingly challenging race to reach net zero by 2050, the goal set out in the Paris Agreement to limit global warming to 1.5°C above pre-industrial levels. It will need to be. Last year broke yet another warming record globally, with another uptick in extreme weather events related to climate change. 2024 also looks set to be the first year to breach 1.5°C warming, a worrying sign of the potential for long-term warming to take hold sooner than feared.
Meanwhile the political outlook looks shaky in the year that Donald Trump has abandoned the Paris Agreement, amid the wider rise of populism and its scepticism of climate targets. Yet the IPCC has warned that carbon emissions must peak in 2025 before going into rapid decline if we have any hope of keeping 1.5°C alive.
The UN has launched Climate Promise 2025, a scheme to help nations strengthen their own national climate pledges (NDCs) to align with the global 1.5°C target. All eyes will be on Brazil in November, where COP30, which will mark 10 years since Paris, is being hosted by the symbolically significant city of Belém, the gateway to Brazil's Amazon region.
As the transition to a low-carbon economy continues, fossil fuel assets are predicted to decline in value but there remain concerns in many regions about capacity and infrastructure in renewable energy markets to meet rising demands.
After two years of turmoil in carbon trading, meanwhile, there are signs of hope. The Integrity Council for the Voluntary Carbon Market, a non-profit body partly created by Mark Carney, the former governor of the Bank of England, is seeking to bolster standards and restore trust in what it sees as an important part of the net-zero picture. The COP29 climate meeting in Baku in November 2024 approved a new, much stricter UN framework for carbon trading on inter-governmental level, ushering in a potential resurgence for carbon markets in 2025.
Sustainability is part of our DNA and guides us in everything we do. Our owner, the Princely Family of Liechtenstein, has always been committed to ensuring that future generations are given the best possible conditions in which to thrive. As one of the leading sustainable investment companies, LGT embraces this principle across all of its activities, and offers a broad range of sustainable investment solutions.
