COP27: 1.5 is Dead and the Fund is Alive

Submitted by Sam Goodman - A New York voter living in Costa Rica.

This year’s U.N. climate negotiations in Egypt (COP 27) yielded mixed results as nations worked to build on the agreement reached in Glasgow last year. The Sharm el-Sheikh Implementation Plan offered a historic breakthrough on the issue of loss and damage and significant language on reforming the global financial system, but it failed to go beyond last year’s text in terms of phasing out fossil fuels. The uneven result had the conference being dubbed “a tale of two COPs.”

Billed as the “implementation COP” by the Egyptian presidency, the conference was the first to be hosted on African soil since 2016 in Marrakesh. This year’s conference presented a unique set of geopolitical headwinds, leading many to question what progress was actually possible. The war in Ukraine and runaway inflation have led to many nations doubling down on fossil fuels and backsliding on their climate pledges. This year’s host country has an abominable human rights record and threatened to undermine civil society’s presence at the conference. 

The decision to establish a fund for loss and damage broke a 30-year deadlock on the issue, delivering a major victory for frontline communities in the Global South. Loss and damage refer to irreparable damages or irreversible losses from the adverse impacts of climate change. While loss and damage should be considered the third pillar of international climate policy, in addition to mitigation and adaptation, it has not been given equal weight in previous negotiations.

In the final days of COP26, 135 nations comprising the Group of 77 (G-77) plus China were in agreement in proposing a Glasgow Facility, a critical step in securing funding for loss and damage from historically high emitters of greenhouse gasses. The proposal for a finance facility was ultimately blocked by the United States, European Union, the United Kingdom, and other nations.

This year, developing nations returned to the negotiations determined to reach a decision to establish a fund for loss and damage. The United States, European Union, and other nations in the Global North initially opposed this, but the strength and determination of the G-77 nations prevailed in the final hours of the negotiations, and a decision to establish such a fund made it into the Implementation Plan.

Another key win can be found in the language surrounding finance in the plan. The text highlights that $4 trillion needs to be mobilized per year to reach net zero emissions by 2050 and states that “delivering such funding will require a transformation of the financial system and its structures and processes, engaging governments, central banks, commercial banks, institutional investors and other financial actors.”

A fundamental change in the global financial system is indeed necessary as developed nations continue to fall woefully short of the modest $100 billion climate finance agreed to in 2009 in Copenhagen and reaffirmed in the Paris Agreement. The text that appears in the  Implementation Plan could pave the way for a radical transformation such as the Bridgetown Initiative, an agenda set forth by Barbados Prime Minister Mia Mottley, who is calling for an overhaul of the World Bank and the International Monetary Fund and an expansion of multilateral lending to governments by $1 trillion.     

The conference was a major setback for global mitigation efforts. A proposal submitted by India with the backing of the European Union, United States, United Kingdom, and other countries to phase down all fossil fuel use did not make it into the final text after pushback from Saudi Arabia, Iran, Russia, and other petrostates. Instead, the final text recycled language from the Glasgow Climate Pact, calling for “the phasedown of unabated coal power and phase-out of inefficient fossil fuel subsidies.” The failure to directly address the source of the climate catastrophe has shown the 1.5C degree goal to be “politically impossible.”

Strengthening the language surrounding fossil fuels will prove to be difficult at COP 28, with the presidency to be held by the United Arab Emirates, the world’s sixth-largest exporter of oil. This year, over 600 fossil fuels lobbyists attended the conference, and they figure to once again have an outsized influence at next year’s summit. 

“The UAE is considered a responsible supplier of energy, and it will continue playing this role for as long as the world is in need of oil and gas,” said Sheikh Mohamed bin Zayed Al Nahyan, President of the United Arab Emirates, in his address to COP 27.

The failure to put “fossil fuels” in the  Sharm el-Sheikh Implementation Plan shows that parties are still not taking the climate crisis seriously, putting the planet on track for catastrophe.