Marketed as ‘Africa’s COP’, COP27 in Sharm el-Sheikh, Egypt, was expected to promote climate justice and expand on the targets developed at previous Conference of the Parties (COP) to the United Nations Framework Convention on Climate Change. Negotiating the loss and damage fund dominated discussions and achieved climate impact justice to some degree, however the conference exhibited limited success regarding tackling the basic causes of climate change.
The Sharm el-Sheikh implementation plan was the text produced at COP27 demonstrating the overarching cover decision agreed on by the parties. The text announced no new targets or commitments and instead requested that countries revisit and strengthen their 2030 targets by the end of 2023, essentially delaying action for a year. Some firsts were demonstrated, including the mention of food, tipping points and the need for financial reform[1] – however there was little discussion on advancements of the target to limit global warming to 1.5°C and phase out fossil fuels.
After 27 years of COPs taking place, a formal agreement to reduce the world’s fossil fuel use has never materialised. The closest to it was the call to phase down unabated coal power, which was endorsed at COP26, and failed to find a consensus on proposals to build on it this year. At COP27, India repeated its view that there should be a case for phase down of all fossil fuels, not just coal, and received the support of approximately 80 countries[2]. Ultimately, it was chosen not to be put into the draft, which resulted in fossil fuel phase out being absent from the cover decision. This signals that oil and gas will continue to be a key component of the energy mix, and emissions reduction technology will be required to achieve net zero goals. Furthermore, in the final text mentions of ‘renewable energy’ were swapped to ‘low-emission and renewable energy’, which could act as an opportunity for the gas industry and future resource development. Through this, fossil fuel companies could be further motivated to invest in technologies such as Carbon Capture and Storage (CCS) to reduce emissions of their activities.
The celebrated progress at COP27 was the loss and damage fund; developed countries with high emissions have agreed to financially aid the nation’s most vulnerable to climate disasters. Previous funds have been available to cut emissions and help countries adapt to climate change, but none to help those after complete destruction due to climate disasters[3]. The new fund marked a victory for small island states and vulnerable countries after a year which has seen extreme climate events, including the flooding in Pakistan and drought in East Africa. Climate reparations will enable equality within the energy transition and have never been more important as the effects of climate change amplify.
At previous COPs, developed countries have opposed these measures, such as when the ‘G77 plus China’ called for a loss and damage finance facility at COP262. This year marked a change, the EU climate chief announced support for considering a fund, under the condition that relatively wealthy, high-emitting countries such as China would contribute to it, and it must focus on countries which are the most vulnerable to climate disasters. In response, the Chinese climate envoy expressed that China are already financially supporting climate reparations but are not obliged to do so under the UN development definitions[4].
The funding arrangements are due to be set up next year and urges developed countries, development banks, NGOs, and businesses to support it, but presents no agreement about how large the funding stream will be or who controls it. The pool of recipients is given as those ‘that are particularly vulnerable’, a loose definition that must be refined to manage the expected high demand for aid. The criteria to trigger a pay-out must be a high priority during the fund’s development for it to work effectively.
Overall, COP27 has been regarded with limited success. It made progress on adapting to the effects of climate change, but not tackling the root cause of it – much of which lies in the energy industry. Energy industry players recognise their role, and many are striving to transform. Looking forward, it is crucial to conduct analyses of how to apply emissions-reducing techniques to current and future processes from a whole-system perspective. Holistic implementation of CCS and energy storage technologies enable companies to achieve their low and zero carbon goals synergistically. As energy transition experts, io is strategically able to develop and optimise these solutions for our clients applying a systems modelling approach, to conduct project trade-offs with the highest decision quality. This strategy allows energy transition opportunities to be realised and executed, creating real change from within the industry.
Photo: UNFCCC COP27 19Nov22 Closing Plenary by Kiara Worth