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This article is part of Fortune’s Blueprint for a climate breakthrough package, guest edited by Bill Gates.

President Biden had barely unpacked his briefcase after being inaugurated on Jan. 20 when he sat down in the Oval Office and inked an executive order that was a key promise of his election campaign: He signed the U.S. back into the global climate deal known as the Paris Agreement. That reversed the action taken by President Trump in June 2017, when he yanked the U.S. out of the accord, claiming that the dictates of other countries would hurt American business. “I was elected to represent Pittsburgh, not Paris,” Trump snarked at the Rose Garden ceremony that day.

Ironically, under the long lead times written into the Paris climate deal, the U.S. only formally dropped out of the accord on Nov. 4, one day after the presidential election. And Biden’s order to rejoin won’t take effect until late February.

But with one stroke of the pen, Biden has made clear that the U.S. is back as a climate leader and a major diplomatic power. He has convened a summit of world leaders on April 22—Earth Day—in order to ramp up action on the Paris Agreement. All that is a jolting break from the past four years. But what will it really mean in the battle against climate change—and is it too late? Trying to answer that requires knowing what the world faces, and what it needs to do to prevent disaster.

What is the Paris Agreement?

After decades of painstaking negotiations over global warming, more than 190 countries met in Paris in December 2015 and signed the world’s first legally binding deal to try ward off planetary catastrophe from climate change. It is by far the most global agreement ever reached on any issue; even war-torn Syria has signed on.

Given that the deal might determine how we humans survive on planet Earth, the Paris Agreement, as it is officially known, is a surprisingly simple, 27-page document. In it, each country agrees to limit global warming by setting individual targets in its carbon-emission reductions, known in the dealmaking lingo as “nationally determined contributions,” or NDCs. Instead of a global police force to hold governments to account, each country is responsible for meeting its targets, with requirements to report its progress regularly to the rest of the world. Developing countries that are still industrializing were allowed to keep growing their carbon emissions while its economies caught up with richer nations, while wealthy countries, including the U.S., agreed to help finance poorer ones in their green transition.

Under its NDC, the U.S. agreed to cut carbon emissions by 2025—26% to 28% of its 2005 levels—and to contribute $3 billion to the global climate fight.

There is one overriding goal: to stop the planet’s temperature from rising by more than two degrees Celsius by the end of this century and then to increase that goal so that global warming is capped at 1.5 degrees Celsius by 2100. In fact, the two-degree Celsius target is regarded as far short of what the planet needs. “The Paris Agreement so far is the best chance the world has to avoid the world of the climate crisis and build a stable future,” says Fred Krupp, president of the Environmental Defense Fund, or EDF, in New York.

“It is the best hope, but it is not perfect,” Krupp says. That’s because the agreement has no mandatory rule forcing countries to remain in the Paris Agreement—although the U.S. is the only one that has so far chosen to leave.

In addition, the world needs far more ambitious climate targets, given the deep peril it faces. “The current level of national pledges does not come close,” Krupp says.

Just how much trouble is the world in?

Sadly, terrible trouble. Global warming is rising even faster today than it was when Paris officials lit up the Arc de Triomphe in bright green that night in December 2015, to celebrate the signing of the climate deal in the French capital. Carbon emissions jumped from 400 parts per million in 2015 to 410 parts per million in 2019, according to the World Meteorological Organization—the fastest rate of increase the organization has ever recorded. And even though the pandemic left billions of people under travel bans or working from home last year, 2020 was the world’s hottest year on record, as was each of the six previous years.

At this rate, according to UN Environment Program estimates, Earth’s temperature will rise by three degrees Celsius by the end of the century from pre–industrial revolution levels—about double the amount of global warming ideally needed to stave off massive climate disasters. The list of victims includes uninhabitable stretches of the U.S. coasts, ravaged agricultural land unsuitable for growing crops, and life-threatening heat waves. Some of that is already on stark display: the locust plague in Africa, severe flooding across Europe, wildfires in Australia, and collapsing California coastal roads. If every country meets the commitments made in Paris in 2015, and then increases their targets substantially over this coming decade, those disasters might just be avoided.

But can the U.S. really make a difference?

Most certainly. The U.S. is the world’s second biggest polluter, after China, and the world’s biggest economy. And until 2016, it was one of the loudest voices in global climate negotiations under then–Secretary of State John Kerry, now back as President Biden’s climate czar. The 2014 climate deal struck between President Barack Obama and Chinese President Xi Jinping, in which they jointly agreed to implement sweeping climate action, is regarded as the single most crucial event leading to a deal in Paris the following year.

“That was the starting pistol to the Paris Agreement,” says Pete Ogden, who was a State Department official in the run-up to the climate talks, and is now vice president for energy, climate, and the environment at the UN Foundation in New York. “Once it was clear they were both committed to it, the last year took on extra urgency.”

One way to gauge the outsize U.S. impact in the Paris Agreement is to see what happened when President Trump pulled out.

In some ways, the withdrawal was a deep setback to the process. Aside from the U.S.’s loss of standing, only $1 billion of its $3 billion commitment was ever paid. Environmental organizations are now pressing Biden to increase the commitment to at least $8 billion.

More than four years after that euphoric deal-signing in Paris, almost no country in the world is on track to meet the targets to which it agreed. With the U.S. absent from the Paris Agreement, governments seemed to ease off on their climate ambitions.

“There was a sense among countries that if you have one of the biggest emitters not contributing, why should we?” says Rachel Cleetus, climate policy director for the Union of Concerned Scientists in Cambridge, Mass. Cleetus, who has attended the yearly worldwide government meetings known as the Conference of the Parties, or COP, says that U.S. officials “kept making mischief” during those talks over the past four years. Trump’s withdrawal, she says, “diluted the global ambitions.”

There was a sense among countries that if you have one of the biggest emitters not contributing, why should we?
Rachel Cleetus, climate policy director for the Union of Concerned Scientists

The European Union raced to fill the leadership vacuum left by Trump’s decision—a role that European Commission President Ursula von der Leyen said in January she will resist ceding to Washington now that the U.S. is back; there will likely be intense competition between the EU and U.S. over innovation, talent, and investment as they roll out their mammoth energy transitions, and each sees leading the global climate fight as a way to influence other countries and boost their international standing.

Even so, EU officials say that with Biden in the White House, the U.S. and Europe can jointly push the rest of the world into far more aggressive environmental action. “We can work together, create critical mass, and rally other important global players,” the European Commission’s Executive Vice President Frans Timmermans, who is the EU’s climate chief, told Fortune in an email. He and Kerry have worked together for years on climate policy. “This is a global, existential challenge,” Timmermans says.

The world can hardly afford to dilute its climate ambitions, as Cleetus puts it. Climate scientists and environmentalists believe that countries need to greatly up their targets from their 2015 commitments—in part to make up for the U.S. vacuum of the past four years—because the Paris Agreement was always designed to be an interim measure, not a full-fledged blueprint to save the planet.

“What was lost in the Trump years was time,” says Krupp, EDF president. “The world was already late in dealing with this crisis,” he says. “And instead of action from the federal government, we wasted four years, with the administration in denial, spewing misinformation.”

Is there any good news?

Yes, quite a bit. Notwithstanding Trump ditching the Paris Agreement, the world has changed dramatically—in many ways for the better.

Solar panels and wind turbines have plummeted in price over the past decade, creating giant markets as cities, countries, and businesses begin to switch out of coal and fossil fuels. That has occurred even under a U.S. President who rejected the energy transition. Trump rolled back several environmental measures during his four-year term, including opening the Arctic to new oil exploration and canceling states’ carbon-emission limits on vehicles. Yet states, cities, and organizations successfully fought back, winning 80 out of 97 lawsuits, by Krupp’s calculations.

Then there are the sheer exigencies of the market, which seem sure to accelerate with Biden’s sweeping climate proposals. Back in 2015, renewable energy was a niche market. Today, it’s a different story. Share prices of renewable energy companies have soared in the past decade, leaping ahead of oil and gas. By 2019, Americans were using more renewable energy than coal—for the first time in 130 years, according to the U.S. Energy Information Administration.

For both global businesses and countries, the surest way to signal that they have a thriving future is by announcing hugely ambitious climate goals. And indeed, it has begun to seem like commonsense business strategy. One day after Biden signed the U.S. back into the Paris Agreement, GM—the quintessential American company—announced that by 2035, it would only produce all-electric, zero-emission cars. Then it trumpeted its decision with a splashy Super Bowl ad casting the GM electric vehicle as this generation’s all-American family car. Now, says Cleetus of the Union of Concerned Scientists, who is an economist, “it is economically smart to invest in renewables.”

Governments, too, have stated fairly ambitious goals, going beyond their Paris commitments. The EU announced in 2019 that it would zero out the carbon emissions of its 27 countries (achieving so-called net-zero status) by 2050. Last October, China announced a net-zero target of 2060.

Now, with the U.S. back in the Paris Agreement, the world might have a better shot holding countries to those grand promises.