One of the most frequently cited challenges to achieving net zero is the need for strong policy levers. However, it is also important to consider the contribution from external factors, distinct and separate from actions of government.
One of these that has been rising in importance, and is now, as can be seen from the Guardian's report, gaining mainstream prominence, is the growing reluctance by insurers to provide coverage to fossil fuel projects - particularly coal-fired generation.
The insurance market is becoming more and more sensitive to the exposure of insured assets to various risks posed by climate change. This includes physical risks (the direct impact of a changing global climate) but also transition risks (the impact on balance sheets of obsolescent carbon-intensive installations), and litigation risks (the potential that one of the many climate / carbon related lawsuits active in several jurisdictions will set a significant and (for the fossil fuel sector) damaging precedent).
In a broader context, the financial sector as a whole is contributing an increasingly loud voice to the climate debate in recognition of the risks that climate change poses to the global financial system. For example see the reports of the Taskforce on Climate related Financial Disclosures and the Network for Greening the Financial System, as well as the previous UK government's own Green Finance Strategy.
If further evidence were needed, Net Zero and related ESG-related reporting are not just "nice to have" for the financial sector but are key considerations for the immediate future. Looked at from another perspective, this changing attitude to carbon-intensive industry could be a powerful non-governmental driver to achieving net-zero.
On a final note, government action and expression of intention is still crucial: from a UK perspective a critical consideration (especially in the context of transition risk) is the intention to phase out the use of unabated coal-fired power generation by 2025.
The number of insurers withdrawing cover for coal projects more than doubled this year and for the first time US companies have taken action, leaving Lloyd’s of London and Asian insurers as the “last resort” for fossil fuels, according to a new report