COP28 – Better With it Than Without

Many epithets have been hurled at the latest annual Conference of Parties (COP) on climate crisis. It has been called, among others, a mere talking shop, ambition without sincerity, much ado about little and a cop out. But these conferences have covered considerable ground in addressing climate crisis, apart, of course, from raising awareness of the looming crisis. At the time of COP21 at Paris in 2015, the world was on a trajectory to get hotter by 4 degrees Celsius by 2100. The consensus among scientists today is that a rise up to 1.5 degrees is manageable, 2 degrees could be damaging , but a rise beyond that would be calamitous. But the latest Emission Gap Report of the United Nations says that the world is headed to a rise of anywhere between 2.5 and 2.9 degrees, perhaps closer to the latter, which is still disastrous.  But the journey from 4 degrees to 2.9 degrees could not have happened without the climate alarm rung by the COP meetings.

After two weeks of negotiations, COP28 ended with an acceptance of the deal by the delegates at Dubai. Negotiators agreed to transition away from fossil fuels, despite earlier demands for phasing them out/down, as it was proving difficult for developing and oil-based economies to agree upon the latter strategy. The deal states that the transition would be done in a way that gets the world to net-zero GHG (Green House Gas) emissions in 2050. It projects the world’s GHG emissions peaking by 2025, to reach its agreed-upon threshold, but gives room to developing countries to peak later. This is a relative positive for India as the economy is expected to be one of the fastest growing in the world. This gives it time for investing in the alternative technologies and policies to reduce emissions in the long-term. Of course, the moot point is whether there is going to be a long term!

While the final draft noted the need for greater finance for poor countries to transition away from fossil fuels and adapt to climate change, it didn’t call upon any additional requirement for monetary support from developed nations, which is already significantly short of initial targets. This is quite worrying, as developing nations will not be able to fund their progress on their own towards climate goals. Also, stringent regulations (carbon tax for instance) from developed nations for doing business will put developing nations out of competition and render transfer of technology more difficult. Additionally, no goals were set to reduce methane emissions (one of the most lethal GHGs), which is disappointing, but high-methane-emitting companies have started to reduce it voluntarily.

The Global Stocktake: The stocktake recognized that global GHG emissions need to be cut 43%/60% by 2030/35 (and reach net-zero emissions by 2050) to limit global warming to 1.5°C. Countries are currently off track in meeting their Paris Agreement goals. For deep and rapid reduction of GHG emissions, nations were called on to triple RE (Renewable Energy) capacity globally by 2030, double the global average annual rate of energy efficiency by 2030, accelerate efforts towards the phase-down of unabated coal power, utilize zero and low-carbon fuels well before or by around mid-century, and accelerate zero- and low-emission technologies (renewables, nuclear, abatement, removal tech).

Funding increased: But not sufficiently to support developing countries in achieving their climate objectives. Over US$ 85bn were pledged for environment-related efforts, showcasing a significant commitment to climate financing, including US$ 61.8/6.8/3.5/0.8bn for Climate Finance/Energy/Green Climate Fund/Loss and Damage Fund. Additionally, World Bank, ADB, African Development Bank and MDBs increased/launched funds to finance climate-related projects and drive positive climate actions. Despite this, developed countries failed to mobilize the committed collective amount of US$ 100bn per year. Besides, as per some estimates, developing countries may need up to US$ 1tn every year for climate action, which is ten times more than the US$ 100bn goal.

Private finance unlocked: Many corporations joined the pledge for global transformation (net-zero emissions/near-zero methane emissions) including Saudi Aramco, Shell, Total Energies, BP, Petrobras, Danone, Nestle, General Mills, The Kraft Heinz, ONGC, etc. Initiatives were taken up to accelerate decarbonization in heavy emitting sectors and transport globally. Oil and gas companies (accounting for 40% of global oil production) came forward to reach net-zero emissions by 2050 or before. Businesses and philanthropic organizations contributed to the climate transition in emerging economies and for the development and deployment of climate-tech solutions.

Pledges and declarations received greater support by nations: More than 10 pledges and declarations were launched, which received historic support. Many countries endorsed declarations which were focused on cutting emissions and achieving net zero (Global Renewables and Energy Efficiency, Triple Nuclear Energy,  and Global Cooling Pledge), transforming agriculture and food systems (agriculture, food & climate), and development of climate-resilient, sustainable, and equitable health systems (climate and health). Climate finance and hydrogen and derivates declarations attracted few, essentially,  developed countries.

But as the Economist puts it, climate finance at the scale required is  not available, affordable or, accessible, particularly in the global south. Reforms are required if the potential of private capital is to be unleashed. The key to reforming the financial system may be the use of catalytic instruments, through which governments assume responsibility for the riskiest tranche of climate projects in a process known as concessional finance, in order to unlock private-sector funding. Hyphen, a German-led consortium, is considering a $9.4bn investment in a solar and wind-powered green hydrogen plant in Namibia, for example, after the German government provided financial backing

India avoids rigid commitments at COP28: India is the third biggest CO2 emitter after China and US; but its per-capita CO2 emissions are just two tonnes of CO2, which is still less than half the global average. India continued to pursue long-term goals, refusing to force itself to strict commitments (declarations). Considering its high growth ahead, a fast paced shift towards low emission fuels and new technologies is a tall task for India considering high population base and resource dependency on developed nations who are unwilling to fully cooperate. That said, India will continue to pursue the transition at its own conducive and constructive pace.

At the end of COP 28 the fact remains that climate talks have quietly, perhaps deliberately ignored history through a focus on the present. Thus the emphasis has not been on cumulative carbon emissions but on countries that are currently large emitters in the aggregate, even if not in per capita terms. But even as we seek answer to this question of climate justice the fact that mankind is already on the brink of climate precipice would mean that COP28 deal can be fruitful only when individual countries earnestly act to achieve their goals and submit their Nationally Determined Commitments in 2025. If India and China take centre stage to cut emissions and roll out rapid transition to green energy, it could drastically reduce the projected global temperature rise.

In the past the question was: Can we put a price on the wonders of nature? Now it is: How long can we survive if we ignore nature?