Here’s how you might pick up the bill for COP26 green promises

World leaders are attending COP26 to discuss climate change. Here’s how these green promises could end up affecting your finances.

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

Environmental technology concept.

Image source: Getty Images

The climate emergency is once again hitting the news as world leaders meet in Glasgow for COP26 to review their green progress and discuss new targets.

So far, there’s been disappointment regarding current figures and excitement over new promises. But who is going to be picking up the bill for all these bold pledges? Read on to find out how this jolly green giant climate summit could end up affecting your finances.

Inflation Is Coming

Inflation is out of control, and people are running scared. But right now there’s one thing we believe Investors should avoid doing at all costs… and that’s doing nothing. That’s why we’ve put together a special report that uncovers 3 of our top UK and US share ideas to try and best hedge against inflation… and better still, we’re giving it away completely FREE today!

Click here to claim your copy now!


What is COP26?

With a name sounding like a retired RoboCop model, you’d be forgiven for wondering what this event is even all about.

COP26 is the 26th UN Climate Change Conference. The ‘COP’ refers to it being the ‘Conference of the Parties’. It’s currently taking place in Glasgow, and there’s a real motley crew of world leaders in attendance. The whole point is to discuss where we’re at in terms of meeting climate goals and see what we need to do moving forward.

Has anything been decided so far at COP26?

So far, we’ve heard a lot about rising temperatures, plans to become carbon neutral, and the year by which we’ll aim to stop hacking down rainforests.

According to the BBC, here are some of the main points agreed so far:

  • Richer nations are to better support poorer countries. In order to do this, former Bank of England governor Mark Carney is attempting to change the way money flows by redirecting trillions of investment to greener activities.
  • Almost £14 billion (of public and private money) is to come from more than 100 countries to reverse deforestation by 2030.
  • Methane emissions are to be cut by 30% by the year 2030. But the biggest emitters China, Russia and India haven’t agreed to this.
  • New market agreements for emerging technologies will be created. This can lead to lots of countries working towards cleaner tech rather than trying to undercut each other
  • In the UK, big companies and financial institutions will have to prove how they plan to hit climate targets.

This all sounds positive, but as most nations already have mountains of debt, who’s going to be paying for all these initiatives?


How might you end up paying for these COP26 promises?

I’m all for a greener planet and reducing my carbon footprint. But some of these ambitious goals are going to take a lot of money. But how could some of these promises end up affecting your finances?

Higher energy prices

The Bank of England has said that some of the COP26 carbon-cutting measures could cause inflation and push up prices. Right now, gas prices are soaring because we still use a lot and there’s been a lack of investment and innovation in the industry.

Transitioning to cleaner energy will likely mean high energy prices continue as we move away from fossil fuels.

Living costs

Along with more expensive energy bills, there’s likely to be more price increases in your daily life. 

Food costs will continue to rise if deforestation is reduced. That’s because a lot of deforestation is carried out to create more farmland to keep up with our food consumption. Stopping the destruction of the rainforests is superb. But it will mean you’ll end up paying more for your groceries. Especially if you’re a meat-eater, as most forest clearing is done used to support livestock.

The cost of clothes may also increase as production can be very energy- and water-intensive. So it might be worth checking out vintage stores and second-hand marketplaces like Depop.


A big chunk of the UK economy is made up of energy and mining businesses. So if you invest in the FTSE 100, it’s likely a lot of your money is going towards companies in these industries. If they take a big hit, so might your portfolio.

You can get ahead of this by refocusing your investing. This could be by buying shares in greener companies or adopting more of an ESG investing approach. However, many firms in the green space aren’t proven money-makers and may not succeed as tech develops.


Rising inflation and low interest rates are a bad one-two combo for savers. Even the best savings accounts offer interest rewards way below the level of inflation.

If you want to be a green saver, there will hopefully be more initiatives like the NS&I Green Savings Bond hitting the market in the near future. But saving this way will likely mean a reduced rate of return on your money (unless the government subsidises these kinds of bonds more).


Until things become more efficient, increasing energy prices could make business costs higher.

Also, with lots more reporting and tracking of climate targets, businesses may face the added cost of taking measures to reduce their carbon footprint. They may also need to provide evidence of the steps they’ve taken under the new COP26 rules.

More on Personal Finance

Note paper with question mark on orange background
Personal Finance

Should you invest your ISA in a model portfolio?

Which model ISA portfolios offer both high performance and low fees? Hargreaves Lansdown, Interactive Investor and AJ Bell go under…

Read more »

Economic Uncertainty Ahead Sign With Stormy Background
Personal Finance

Is it time to exit emerging markets investments?

Investors may well be sitting on losses from emerging markets funds. Is it worth keeping the faith for a sustained…

Read more »

Personal Finance

Share trading? Three shares with turnaround potential

Share trading has been difficult in 2022, but which companies have turnaround potential? Jo Groves takes a closer look at…

Read more »

Man using credit card and smartphone for purchasing goods online.
Personal Finance

Revealed! Why Gen Z may be the savviest generation when it comes to credit cards

New research reveals that Gen Z may be the most astute when it comes to credit cards. But why? And…

Read more »

Environmental technology concept.
Personal Finance

The 10 best-performing sectors for ISA investors

The best-performing sectors over the past year invested in real assets such as infrastructure, but is this trend set to…

Read more »

Road sign warning of a risk ahead
Personal Finance

Recession risk ‘on the rise’: is it time for investors to worry?

A major global bank has suggested the risk of a recession in the UK is 'on the rise'. So, should…

Read more »

pensive bearded business man sitting on chair looking out of the window
Personal Finance

1 in 4 cutting back on investments amid cost of living crisis

New research shows one in four investors have cut back on their investing contributions to cope with the rising cost…

Read more »

Image of person checking their shares portfolio on mobile phone and computer
Personal Finance

The 10 most popular stocks among UK investors so far this year

As the new tax year kicks off, here's a look at some of the most popular stocks among UK investors…

Read more »