COP27 what to watch: Climate progress hinges on crucial week two

It’s been more than a week since delegates from nearly 200 countries touched down in the coastal town of Sharm el-Sheikh, Egypt, to wrestle with how to implement their climate promises against a backdrop of an unprecedented energy crisis.

Around 45,000 attendees at COP27 battled the hot Egyptian sun as they darted between over-air-conditioned convention halls for meetings and panel sessions.

The first week was dominated by the arrival of world leaders, ending on Friday with a visit from US President Joe Biden. It wasn’t all just big names and big speeches though. Behind the scenes, negotiators started getting into the nitty-gritty of what has to be achieved at this year’s summit: The most important being the rapid scale up of climate finance and ensuring that the world’s emissions are finally put on a downward course to keep the Paris Agreement’s 1.5 degree Celsius goal alive.

During the second week, ministers will try and break the deadlock on a range of issues and ensure the world doesn’t backslide on ambition.

“The outcome isn’t just for the climate, it’s also for the hard kind of geopolitical crisis we’re in where we do need multilateral cooperation,” said Tom Evans, a climate policy advisor at think tank E3G. “If we end up with a sense of backsliding, a sense of being stuck then what sort of signal does that send about our ability to work together in the face of all these crises?”

Here’s how week one went down and what to expect from the rest of this year’s UN climate summit:

A Big Step Forward 
 

Talks got off to a flying start this time last week, when negotiators agreed on an agenda item for loss and damage. In other words, for first time countries are discussing how the economic and cultural destruction wrought by extreme weather in developing countries can be financially covered by those with the highest historical emissions. Recent climate disasters, such as the floods in Pakistan, had put the issue back into focus. 

The gloss quickly wore off though, with countries arguing over how such losses and damages can be paid for — whether through a dedicated financial facility or a “mosaic” of existing institutions. Rich countries also want more recent high emitters like India and China to cough up some cash. US Special Presidential Envoy for Climate John Kerry said that anything involving compensation or liability “is just not happening, for a whole bunch of countries.”

“It is now an agenda item, it is not solved,” said Jochen Flasbarth, German state secretary for economic cooperation and development. Whatever solution we find “needs to apply for all relevant polluters.”

More Positive News
 

The first week of COP27 had other successes. Barbados Prime Minister Mia Mottley’s “Bridgetown Agenda,” which lays out how multilateral banks should be overhauled to provide more climate finance — as well as other innovative financial solutions — received public praise from French President Emmanuel Macron and tentative support from the UK and Germany.

South Africa’s landmark $8.5 billion investment plan to shift away from coal was given an official sign off from donors. And that’s set to be dwarfed by a similar deal for Indonesia. That one will total as much as $20 billion when launched at the Group of 20 summit in Bali next week.

Canada, the US and Nigeria, meanwhile, all announced new regulations to tackle emissions of one of the most potent greenhouse gases: methane.

One Step Back
 

The US midterm elections cast a shadow from Washington to Egypt, as Biden administration officials sought to assure foreign leaders that Republican gains in Congress would not decimate the country’s climate progress. (Democrats have kept control of the US Senate.) Kerry pushed back on concerns that it could impact the flow of investment into green technology. His plan to create new carbon credits to accelerate decarbonization in developing countries drew criticism, but the US’s top climate diplomat insisted a novel approach was needed to entice risk-averse private capital into renewable projects in emerging economies.

When it comes to climate finance, poor countries have been burned on promises for funds from the developed world before. And rich counterparts don’t appear any closer to living up to a long-elusive $100 billion pledge. So far there hasn’t been much extra money coughed up, aside from some small pledges for loss and damage from the likes of Germany, Scotland and Austria.

Europe, meanwhile, was slammed for encouraging African countries to build more gas infrastructure. Germany, in particular, was accused by one African NGO of “energy colonialism” as it sees to replace its Russian supplies following the invasion of Ukraine. The activist said the EU and Germany were using the continent as its “gas station.” A report last week said new liquefied gas production and facilities could see the world miss its 1.5 degree warming target. Other scientific reports painted a similarly bleak picture.

What to Watch
 

With the exception of the imminent arrival of Brazil’s newly elected president Luiz Inácio Lula da Silva, many world leaders have come and gone from the climate talks. The second week is where negotiators really get to business as ministers arrive to break the deadlock of more technical discussions in the first week. Aside from fractious talks on loss and damage, a key element will be what kind of “cover decision” the Egyptian Presidency pursues. The document signals the political action countries are willing to take to meet their climate commitments.

Last year in Glasgow, countries agreed to “phase down” the use of unabated coal and phase out inefficient fossil fuel subsidies — a landmark commitment that has been tested by the energy crisis. How much ambition the Egyptian Presidency aims for is the key question. Too much and they risk failure. Too little and they risk heavy criticism from developing countries, island states and civil society.

Interestingly, India has pushed for the language on coal to be expanded to all fossil fuels. The High Ambition Coalition — a key group of countries pushing for stronger climate outcomes — will also release their statement early in the week.

Elsewhere, Turkey may publish a revised climate pledge next week, following Mexico’s stated ambition to increase its 2030 emissions cutting target to 35% from 22%.

On the Sidelines

Don’t just look inside the COP27 for more ambition. World leaders will gather in Bali, Indonesia, next week and anything said on climate there is likely to filter into negotiating rooms back in Sharm El-Sheikh. Hopes for a thawing in relations between China and the US have also been buoyed with Biden and China Premier Xi Jinping set to meet for the first time since climate talks between the two sides broke down.

That will also be were Indonesia announces its massive Just Energy Transition Partnership.

Organizer Chaos

Among the PR nightmares for organizers this week was what smelt and looked like a sewage system leak between halls of the conference center. There were also accusations of price gouging, which forced the Egyptian authorities to slash the cost of $11 sandwiches in half and make soft drinks free.

Undeterred by the overpriced hotels and  myriad security concerns, non-governmental groups continued to call for countries to re-commit to stronger emissions cuts. For the first time, activists did their traditional Saturday protest march within the conference’s walls, overseen by the United Nations.

Watch out for any updates on the health of imprisoned British-Egyptian political dissident Alaa Abd el-Fattah, who has stopped eating and drinking water.