From a carbon market to a coal ‘phase down,’ here are the 8 key takeaways from COP26

But Glasgow was never going to be Paris—a “deal or no deal” kind of event—so assessing where the world has made strides, and where it’s fallen short, isn’t quite so clear-cut. The main takeaway is somewhere in between. Governments (and companies) are now starting to move very fast, acting with an urgency and unity to map out how, exactly, the world is going to decarbonize that is often remarkable—and also frequently falls short of what’s really needed.

Let’s drill into some of the takeaways.

Keep 1.5 degrees alive

The landmark Paris Agreement was built around keeping temperature rise to 2 degrees Celsius by 2100, and “preferably to 1.5 degrees Celsius.” While the UN-ese of the final Glasgow document can be baffling, the language has shifted to reflect a clear ambition: 1.5°C is the new must-have, not just what the signatories would “preferably” like. As many vulnerable countries pointed out during the conference, that half degree can mean the difference between life and death.

Still, getting to a cap of 1.5°C won’t be easy. The world went into COP26 with pledges that put it on track for a 2.7°C temperature rise, and major pledges—including from India—saw that estimate drop, albeit with a large range: The International Energy Agency said the estimate was now 1.8°C, and Carbon Tracker said the estimate was about 2.3°C. Expect to see estimates coalesce in the coming weeks.

Coal and fossil fuels

The Glasgow pact includes, remarkably, the first-ever references to fossil fuels in a COP document, and it’s something of a triumph that those words are there at all. But the references are deeply qualified. Demands to phase out coal has been a cornerstone of Glasgow, even as coal demand is on a tear. But the reference was watered down—from “phased out” to “phased down”—in the final hours of the conference on Saturday night under heavy pressure from India, with support from China and the U.S. Still, the phrasing of the deal to end “unabated” coal—in other words, coal that isn’t offset with carbon capture and storage—threatens to make coal utterly uneconomical in the real world, as Fortune’s Eamon Barrett writes. Meanwhile, a reference to ending fossil fuel subsidies was also watered down to ending “inefficient” fossil fuel subsidies, which leaves plenty of wiggle room.

A carbon market deal

The establishment of a carbon “tax” is one of the few climate policies that governments across the political spectrum claim to support as a means to reorient market economies toward decarbonization. Companies, too—at least the companies that attend COP26—really want a global carbon tax. (Ignacio Galán, the CEO of Iberdrola, told Fortune he would be “more than delighted” to see one come out of the conference.) And yet for a grab bag of reasons, carbon markets remain largely regional.

With that in mind, one of the most welcome advances to come out of COP26 was an agreement to start setting up a global, UN-backed carbon credit that can be swapped and traded around the world, stitching together a network of regional deals. Still, that’s far short of a universal “tax,” and includes plenty of technical loopholes. Plus, it’s voluntary.

Pressure on climate finance

You couldn’t turn around at COP26 without seeing a CEO—or a treasury secretary, or a former central banker. The world of finance, both public and private, was out in force for the first time. Brian Moynihan, CEO of Bank of America, quipped to Fortune that he hadn’t been in Paris in 2015—and “that may be a statement in and of itself.” Janet Yellen, U.S. Treasury secretary, said much the same, noting, “the reality is, it is not common for finance ministers to attend a COP. In fact, I am the first U.S. Treasury secretary to do so.”

The role of finance had a formal role at the event. There was the announcement of former Bank of England governor Mark Carney’s Glasgow Financial Alliance for Net Zero, which now covers a staggering $130 trillion worth of assets (even if it comes with a few caveats). And there was the agreement’s own focus on what it would cost—and who would pay—for developing countries to adapt to climate change. But unofficially, the feeling was simply that many CEOs had to show their faces—making it clear that they no longer see sustainability as a fluffy “nice to have,” but a pressure that will fundamentally change their businesses and industries, from energy to banking to shipping to real estate.

The U.S. is back—or is it?

U.S. President Biden, and climate envoy John Kerry, made repeated appearances in Glasgow (other appearances included Barack Obama, Alexandria Ocasio-Cortez, and Nancy Pelosi). The point was clear: former President Donald Trump may have removed the U.S. from the Paris Agreement, but the U.S. is back at the climate table and leading the way. On the other hand, domestic politics were a frequent distraction, with the Scotland appearances smack-dab in the midst of fraught efforts to push through Biden’s Build Back Better infrastructure deal, which includes significant funding for renewable energy and green jobs. U.S. officials as a result faced significant skepticism, and constant questions, from other delegates and journalists on whether they could truly lead the world without winning a robust climate mandate at home.

China and the U.S. partner up

Amid the internal turmoil, Biden and other U.S. officials spent many of their speeches hitting out at the absence of Chinese leader Xi Jinping. And then, in a complete twist, John Kerry and Chinese counterpart Xie Zhenhua came out on Thursday night and announced that they were putting aside their geopolitical tensions to work together on climate change—a partnership Kerry himself compared to the 1983 Reykjavík Summit between Reagan and Gorbachev. It was largely symbolic, but it was still a welcome surprise from the world’s two largest emitters.

A lack of trust

Hanging over the event, and arguably slowing its progress, was a stultifying lack of trust—between developing and developed countries, and between (often young) activists, including Greta Thunberg, and the governments plugging away in the plenary rooms. There are plenty of reasons for that: Vaccine inequality has undermined pledges of solidarity in the face of global challenges, and an unfulfilled $100 billion aid pledge—for developed countries to help developing countries cope with climate change they were not responsible for—hung over the event. Outside the event campus in Glasgow, meanwhile, activists labeled the whole conference a greenwash and a failure.

The final agreement didn’t mend those wounds. Many activists felt that the deal was a flop—not the bold progress that would reflect the urgency of the climate crisis—while many small island states supported the final pledge, but with grudging resignation. The $100 billion promise remains unfulfilled, and pledges to help vulnerable and developing countries cope now with the disasters and crop failures they are already facing—formally known as the Loss and Damage provisions—remained vague and fuzzy.

Come back next year!

Let’s do this all again next year, the UN says—and try to come back with more ambitious policies. The Glasgow pact asks countries to revisit their national plans (called NDCs) for reducing emissions by 2030 again in 2022, and go through all the spectacle and scrutiny of another high-profile climate summit.

This might seem like a case of kicking the can down the road, but it’s actually a key accomplishment of Glasgow. Where Paris was built around countries revisiting goals every five years, the timeline—and the world’s attention—has now been accelerated, reminding countries that their populations are facing the fight of our collective lives. COP26 may be over—but the pressure is on.