- COP28 began with a historic decision on a loss and damage fund. However, a lack of consensus on finance, equity and fossil fuel phase-out threatens to stall progress.
- The COP28 Presidency released the Global Stocktake draft text on Monday that dropped the fossil fuel phase-out idea, sparking criticism from civil society and some party members.
- Developing nations emphasise the need for financial support, asserting that insufficient funds will impede the execution of ambitious climate goals.
The 28th Conference of Parties (COP28) made history by delivering a decision to launch a fund for climate losses and damages on the first day of the conference. But as the end of the two-week summit draws near, a lack of unity on matters related to finance, equity in climate action, and – most crucially – a fossil fuel phase-out, threatens to derail the rest of the process.
On December 11, the COP28 President Sultan Al Jaber, released a draft text on the Global Stocktake (GST) – the first exercise assessing collective progress under the Paris Agreement since it was signed – encompassing actions across climate mitigation, adaptation and finance. Parties have been debating policy recommendations the GST should carry to signal the future course of climate action but have failed to reach a consensus on several outstanding issues.
Several countries, particularly small island states supported by the European Union, have called for a ‘complete phase-out’ of fossil fuels – a proposition that has gained momentum since it was proposed at the COP27 in Sharm el-Sheikh, Egypt. After finding the feature as an “option” throughout negotiations, the latest text proposed by the Presidency dropped the idea entirely, drawing sharp criticism from civil society organisations and some party members.
Far from bringing consensus that could wrap the process up by the summit deadline on December 12, observers say the talks are likely to spill over as parties attempt to renegotiate the terms of the GST. India, in the meanwhile, has said the GST should review progress since before the Paris Agreement. The country also supports the application of equity and CBDR across the UNFCCC process.
Apart from a fossil fuel phase-out, developing countries have pointed to deeper fissures on issues of finance and attempts to dilute the principles of equity and common but differentiated responsibilities (CBDR) that govern the United Nations Framework Convention on Climate Change (UNFCCC) and the Paris Agreement under it.
There are likely to be several rounds of negotiation before a final GST text is approved, a negotiator from the G77 and China told Mongabay-India.
Divisions on fossil fuel phase-out
The President’s draft proposal comes days after a leaked letter from the Organization of the Petroleum Exporting Countries (OPEC) urged its 24 country members to “proactively reject any text or formula that targets energy, i.e., fossil fuels rather than emissions.” Saudi Arabia, an OPEC member and the world’s largest oil exporter, blocked phase-out language in negotiations last week, according to Alden Meyer, senior associate at climate think tank E3G.
On December 10, Al Jaber convened a majlis or a seated gathering among the parties, inviting them to air their views on how to proceed over issues that had been deadlocked in the previous week of negotiations. A delegate from Saudi Arabia took the floor to say the country had “raised our consistent concerns over the attempts to attack energy sources instead of emissions.”
But Saudi Arabia is not the only country hesitating to call for a fossil fuel phase-out. The United States, among the world’s largest oil producers with plans to continue expansion till 2050, has publicly said it will support a phase-out of “unabated” fossil fuels (referring to fuels whose carbon emissions are captured and stored) but did not speak during the informal meeting. “We are anticipating that the U.S. might be posturing itself to suddenly support a fossil fuel phase-out. But I want to be blunt and call this what it is – it is a bluff,” said Rachel Rose Jackson, Director, Climate Research and Policy, at Corporate Accountability, a civil society organisation observing the talks, in a briefing with reporters.
The current draft text replaces a fossil fuel phase-out option with a host of other actions that “could” possibly include “reducing both consumption and production of fossil fuels, in a just, orderly and equitable manner.” It also repeats the call from COP27 to phase down unabated coal power but adds “limitations on permitting new and unabated coal power generation.” It also calls for phasing out “inefficient fossil fuel subsidies that encourage wasteful consumption.”
“This menu-of-options approach with a host of bad ingredients and no fossil fuel phase-out is both unappetising and unacceptable. Simply put, if this text were agreed, it would represent a staggering failure on the most fundamental test facing this COP, this process, and humanity,” said Nikki Reisch, Director of the Climate and Energy Programme at the Center for International Environmental Law, in a statement.
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Finance and equity talks stalled
Developing countries have raised a host of other concerns that could also contribute to fracturing a consensus on a fossil fuel phase-out, among other issues – namely financial support.
“How are we going to phase out fossil fuels? Where is the economic deal to do that?” During the majlis, Colombia’s Minister of Environment, Susana Muhamad, added, “We are trying to bring this transformative action, but we have to align our economic and financial system to this decision. The architecture of the system is against us.”
South African environmental Minister Barbara Creecy said South Africa was a middle-income country that signed a Just Energy Transition Partnership (JET-P) to transition away from coal and has plans to scale up green hydrogen and use more electric vehicles. “But to date, we have received less than 10% of the support we need between now and 2030 to implement this ambitious plan. For many developing countries, especially in Africa, the gap does not relate to ambition, but to the means of implementation,” she said.
According to Meena Raman, head of programmes at the Third World Network, an observer of the negotiations, developed countries have tried to “dilute” their obligations to pay for climate finance. “They don’t want to talk about scaling up or predictable resources. They say they will commit and that multilateral development banks and private sector will deliver,” she said, adding, “But if you don’t have the means of implementation, there’s no point coming here and talking about lofty targets. Developing countries will not be able to implement anything out of these talks.”
The U.S. has repeatedly said governments will be unable to meet the requirements of climate finance and that the private sector must bridge the gap. Developing countries have pushed back by saying new, additional, and grant-based public finance is key. “Developed countries should fulfill their obligation to provide finance to developing countries,” said Diego Pacheco, spokesperson for the Like-Minded Developing Countries (LMDC).
This story was produced as part of the 2023 Climate Change Media Partnership, a journalism fellowship organised by Internews’ Earth Journalism Network and the Stanley Center for Peace and Security.
Banner image: Several countries, particularly small island states supported by the European Union, have called for a complete phase-out of fossil fuels at COP28. Photo by IISD/ENB | Mike Muzurakis.