COP Killer; Let’s Talk Wins & Losses of COP 27
As far as good cop / bad cop goes, this year’s COP 27 has shaped up to feel like…okay cop. Agreed to by 200+ countries, developing nations were able to secure a historic fund for “loss and damage” resulting from climate change — essential for countries such as Madagascar who contributes .01% of the world’s CO2 emissions but who is experiencing the world’s first climate famine. Disappointingly, no agreement was reached to phase out fossil fuels. The latter proposal was vetoed by a coalition led by Saudi Arabia and joined by Russia.
While last year’s COP 26 delivered an agreement to phase down coal (key word being down and not out), demands from scientists and activists to leave all that old dinosaur juice in the ground struggled to gain traction the backdrop of the Russian invasion of Ukraine and subsequent energy crisis in Europe. Without the reduction of all fossil fuels, like oil and gas (not just coal), it will be virtually impossible to halve carbon emissions by 2030. This COP 27 highlighted that while 1.5°C maximum of warming remains the goal, little progress has been made in keeping that target achievable, with the planet on track for 2.8°C of warming by the end of the century.
Due to this trajectory, COP included an increasingly large focus on adaptation in addition to mitigation. While this may feel like giving up in a sense, it is also an acknowledgment of the reality the world faces. Over 1.6bn people currently inhabit climate “vulnerability hotspots”, and this number is expected to double by 2050. Adaptation will require large-scale efforts, from establishing systems to limit flooding in coastal areas to finding solutions to limit landslides in mountainous regions. COP 27 saw significant progress on adaptation with governments agreeing on the way to move forward on the Global Goal on Adaptation established at COP 26. New pledges totaling more than $230m were also made to the Adaptation Fund which will assist vulnerable communities in adapting to climate change.
In an era where it feels like every major weather event sets a new record — from the most severe flooding in recent history displacing 32 million people in Pakistan, to Hurricane Ian resulting in Florida’s costliest storm to date, to record drought and famine in the Horn of Africa affecting 37 million people — gatherings like COP can feel like a Band-Aid on a gaping wound. However, COP 27 did deliver crucial funding for vulnerable countries, a new five-year work program to promote climate technology solutions in developing countries, and a package of 25 new collaborative actions to be delivered by COP28 to speed up the decarbonization under five key breakthroughs of power, road transport, steel, hydrogen and agriculture. Young people also had a greater seat at the table, with a first-of-its-kind pavilion for children and youth, as well as the first-ever youth-led Climate Forum. Increased youth participation is essential for properly addressing this multi-generational crisis, and youth activism has already pushed the response to be more diverse, intersectional, and holistic. This rising generation has helped FWP maintain our optimism that the world will ultimately solve this crisis, albeit with missteps — such as private jets being taken to a climate conference — along the way. COPs may not be the be all end all to the world’s climate response, but any progress made does help us breathe a bit easier.
Madelyn O’Farrell, Investment Analyst
COP’s distant cousin, the UN Biodiversity Conference, will take place in Montreal beginning in December. Many are hopeful that this year’s gathering will result in a “Paris moment for nature”, a legally binding north star on biodiversity for the world’s governments as exists for climate. Key details of the Post-2020 Global Biodiversity Framework will need to be resolved in Montreal in order to achieve the vision of living in harmony with nature by 2050.
One proposal to finance the greening of power grids in developing countries: have private companies purchase carbon credits to fund the projects. Pitched by U.S. envoy John Kerry at COP 27, this plan is intended to make a dent in the $100bn promised to developing countries from those who have contributed the most to climate change (i.e., the United States, who has emitted more CO2 than any other country to date) without governments having to shore up additional aid, a likely unfeasible feat in the current political climate in the U.S.
For a deeper dive on COP 27’s expectations, negotiations, and outcomes, check out this 4-part podcast series from The Economist.
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