COP27 | Climate finance to rule the agenda at the UN summit in Egypt

The situation was no different in other parts of the world. We had Hurricane Ian in Florida, drought and heat waves in Europe, flooding and drought in China, Hurricane Fiona in the Caribbean, and flooding in South Africa, among others, leading to a loss of lives and massive property damage.

Between January and September this year, natural disasters across the world have caused economic losses of at least $227 billion, of which a mere $99 billion was covered by public and private insurers, according to a report by Aon, an insurance broker. Insured losses due to weather calamities will breach the $100 billion mark for the third consecutive year, the insurance giant said in October.

Tardy progress on climate action

Although the climate crisis seems to be accelerating, countries were found wanting in their efforts to arrest the rise in global temperatures, as a slew of reports released in the past week ahead of COP27 pointed out.

There is “no credible pathway” to limit global warming to 1.5 degrees Celsius, an ambitious target set by the 2015 Paris Agreement, the UN Environment Programme (UNEP) warned in its Emissions Gap Report 2022 published on October 27.

The 13th annual report of the UN environment agency showed that the updated national pledges since COP26, held in November 2021 in Glasgow, will make little difference to estimated greenhouse gas (GHG) emissions in 2030.

“We are far from the Paris Agreement goal of limiting global warming to well below 2 degrees Celsius, preferably 1.5 degrees,” the report said. “Policies currently in place point to a 2.8-degree rise in temperature by the end of the century. Implementation of the current pledges would breach the Paris Agreement goal of containing global warming below 2 degrees compared with preindustrial times.

The world requires a systemic transformation to deliver the huge cuts in emissions planned by the end of this decade. Compared to projections based on policies currently in place, emissions will need to be reduced by an additional 45 percent, the UNEP report said. Only a handful of countries have firmed up their plans in the past one year, despite promising to do so at the COP26 summit in Glasgow.

Bending the emissions curve

Although nations worldwide are slowly lowering GHG emissions, the efforts are not enough to limit global temperature rise to 1.5 degrees by the end of the century, according to the 2022 NDC Synthesis Report published on October 26 by UN Climate Change. The UNCC is the agency that hosts the climate summit. Only 24 new or updated national climate plans had been submitted since COP26, it said.

“We are nowhere near the scale and pace of emission reduction required to put us on track towards a 1.5 degree-Celsius world,” said Simon Stiell, Executive Secretary, UNCC. “To keep this goal alive, national governments need to strengthen their climate action plans now and implement them over the next eight years,” he added.

The lethargic progress has resulted in the atmospheric levels of all three major GHGs breaching new highs, the World Meteorological Organization (WMO) said in its latest Greenhouse Gas Bulletin released on October 26.

The increase in carbon dioxide levels from 2020 to 2021 was larger than the average annual growth rate over the past decade, although economic activity slowed globally due to COVID-19, the WMO report said.

The findings have “underlined, once again, the enormous challenge – and the vital necessity – of urgent action to cut greenhouse gas emissions and prevent global temperatures from rising even further in the future,” Petteri Taalas, Secretary General, WMO, said in a statement.

“The continuing rise in concentration of the main heat-trapping gases, including the record acceleration in methane levels, shows that we are heading in the wrong direction,” he added.

Endangering health and food security

Extreme climatic events are causing disasters in every continent, adding pressure on health services already stressed by the COVID-19 pandemic, the 2022 report of the Lancet Countdown on Health and Climate Change said on October 25.

In 2021, India lost 167.2 billion potential labour hours due to heat exposure, with income losses equivalent to about 5.4 percent of GDP, the Lancet report said. Compared to 2000-04, the country had a 55 percent increase in heat-related deaths between 2017 and 2021, the report said.

Global warming has serious implications for food security. This was seen in the reduced wheat harvest in India in 2022 as extreme heat shrivelled standing crops in March, just ahead of the spring harvest, leading to a reduced output for the first time in years. The growth season for maize has declined by 2 percent compared to the 1981-2010 baseline, while rice and wheat have decreased by 1 percent, the Lancet Countdown said.

Amid all the grim reports in the recent past, the only good news was on the energy front. Carbon emissions from burning fossil fuels are expected to peak by 2025 in a “historic turning point” towards a cleaner and more secure future, according to the World Energy Outlook 2022, released by the International Energy Agency (IEA) on October 27.

The war in Ukraine since February has precipitated an energy crisis in Europe. This has caused oil and gas prices to spike globally, triggering persistently high inflation across the world, creating favourable conditions for an economic recession in western countries.

Despite geopolitical headwinds, investment in renewable and low-carbon energy sources such as solar, wind, and nuclear power would likely rise to $2 trillion a year by 2030, an increase of more than 50 percent from what it is at present, the IEA said in its annual report.

“Even with today’s policies, the energy world is shifting dramatically before our eyes,” IEA Executive Director Fatih Birol said. “Government response around the world promises to make this a historic and definitive turning point towards a cleaner, more affordable, and more secure energy system,” he added.

The money to fight climate change

Given the dire backdrop and accelerating climate crisis, it is widely expected that issues around finance will dominate discussions at COP27. In 2009, rich nations had promised to cough up $100 billion a year between 2020 and 2025, to support climate action in developing countries. That hasn’t happened 13 years down the line.

At COP26, it became clear that the developed world had failed to honour their commitment. The broken promise will continue to be a bone of contention at the Egypt summit, and we have to see whether any progress is made on this front.

Emerging and poor economies are also expected to highlight the loss and damage due to climate change, and demand financial resources to mitigate the disasters.

At the Glasgow summit last year, loss and damage were discussed for the first time in the main negotiation track due to vociferous demands made by countries facing the adverse effects of global warming.

Expectations are high that substantial progress will be made in this contentious matter this year. “Egypt is hosting an African COP, so there is going to be lots of attention, and rightly so, on finance, and loss and damage,” Antony Froggatt, Deputy Director of the UK-based Chatham House’s Environment and Society Programme, told a news portal. “This is very clearly a time in which we can make progress in these areas.”

Talks at COP27 are also likely to look into workable solutions to adapt to climate change, which would include strategies to manage climate risk and building climate resilience. The COP27 presidency, chaired by Egypt this year, expects countries to capture and assess their progress toward enhancing resilience and helping the most vulnerable communities.

Any discussion on climate action will therefore hinge on the source of funding and the willingness of rich countries to contribute to resource mobilisation.

Whether the talks will translate into specific commitments is uncertain. Many would say that the very credibility of the UN-hosted summit would depend on the pace of progress made on the thorny issue of climate finance.