Loss and damage breakthrough but fossil fuels preserved in COP27 agreement

An agreement has been struck for developed nations to compensate developing ones for loss and damage caused by climate change.

But efforts to limit the advance of global warming have been stymied elsewhere at COP27.

The final agreement brokered by 195 nations marked a breakthrough in charting a course for loss and damage actions and compensation finance.

But UN Secretary General Antonio Guterres, whose rhetoric against carbon emissions has hardened in recent years, criticised nations for failing to make critical commitments to end fossil fuel use.

“Climate chaos is a crisis of biblical proportions. The signs are everywhere. Instead of a burning bush, we face a burning planet,” Guterres says.

“Our planet is still in the emergency room. We need to drastically reduce emissions now – and this is an issue this COP did not address.

“A fund for loss and damage is essential – but it’s not an answer if the climate crisis washes a small island state off the map – or turns an entire African country to desert.”

Loss and damage programs are intended to support the developing nations most vulnerable to climate change in addressing its impacts.

The recent Intergovernmental Panel on Climate Change (IPCC) report on impacts, adaptation and vulnerability found the financial impact of climate change would vary among regions, but developing countries would be harder hit by damages as a proportion of income.

Such impacts would increase as global warming thresholds – like 1.5°C – are breached.

That report also found adaptation measures – which COP27 delegates identified in the final implementation agreement to have a marked gap between current and required levels – were incapable of preventing all losses and damages, “even with effective adaptation”.

Slow but significant progress on loss and damage compensation

The agreement to advance loss and damage funding for developing nations comes in the shadow of a previously failed commitment by wealthy economies to annually supply poorer ones with US$100 billion finance until 2020. That deal was brokered at the Copenhagen climate conference in 2009.

Agreements were also forged to establish a ‘transitional committee’ that would recommend how to implement finance programs, and deliver technical assistance to vulnerable nations through the Santiago Network for Loss and Damage established in 2019.

Loss and damage finance is essentially an acknowledgement that wealthier nations, which contribute the most carbon emissions leading to human-made global warming, should compensate those producing substantially less.

Ten countries – China, the US, India, Indonesia, Russia, Brazil, Japan, Iran, Canada and Saudi Arabia – account for around three fifths of global greenhouse gas emissions.

“The COP27 climate negotiations delivered mixed results,” says Professor Brendan Mackey from the Griffith University climate change response program.

“On the positive side of the ledger, loss and damage is now on the agenda, it is acknowledged that the climate change and biodiversity global crises are interlinked, and the importance was stressed of climate justice.”

“On the negative, it remains a major sin of omission … that the most important mitigation strategy – the rapid phasing out of all fossil fuels for clean energy sources – remains muted in the plan.”

Fossil fuels remain part of the climate action picture

Although the advance of loss and damage initiatives marked a high point for the climate conference, some of the language adopted in the final agreement was observed to only slightly diminish the influence of fossil fuels.

Last year’s Glasgow Climate Pact was criticised for using language to “phase down” coal used for energy, rather than phasing it out completely.

That language persisted in the COP27 plan, which calls nations to “transition towards low-emission energy systems”, accelerate “efforts towards the phasedown of unabated coal power” and “phase-out of inefficient fossil fuel subsidies”.

Australian climate experts watching proceedings were critical of this language, given its failure to emphatically rule out fossil fuel use.

Many noted the agreement placed so-called “low-emissions” energy alongside no-emissions renewable energy sources. Methane gas is often pointed to as a shorter-lived atmospheric carbon alternative to carbon dioxide released by coal. However, methane is around 25 times more potent at trapping heat energy despite its shorter lifespan.

“Whilst recognising the science behind the IPCC reports, the COP27 text did not reflect the clear conclusion by the IPCC that GHG emissions need to peak and start declining before 2025 if the Paris Agreement temperature goals are to be achieved,” says ANU Institute for Climate, Energy and Disaster Solutions director, Professor Mark Howden.

“The text also markedly weakened the Glasgow COP26 language to accelerate the phasing out of coal by instead referring to the phasedown of unabated coal power, thus leaving a major loophole for coal producers which could significantly delay emission reduction.

“Similarly, the clear Glasgow statement to phase out subsidies for fossil fuels is now ambiguous with reference instead to inefficient fossil fuel subsidies. Who and how decides what is an efficient or an inefficient subsidy? And what is the phase-out date? This is another loophole that is likely to delay emission reduction.”

Melbourne University law professor and director of the university’s Climate Futures institute Jacqueline Peel shared those views, describing the influence of fossil fuel producers – including major coal and oil producing nations – as “considerable”, although she also notes the adoption of loss and damage projects is an important signal.

The COP27 text did not reflect the clear conclusion by the IPCC that GHG emissions need to peak and start declining before 2025 if the Paris Agreement temperature goals are to be achieved.

Professor Mark Howden

“Establishment of the fund is important recognition by rich nations that they will have to pay for the impacts of the climate crisis on poorer nations,” she says.

“With the moral justice of vulnerable nations’ cause endorsed, expect to see legal accountability follow as courts – international and domestic – are increasingly engaged with questions about legal duties of governments and corporations to deliver climate justice to those most in need.”

Fossil no longer, but Australia’s carbon challenge remains large

COP27 marked the first time since 2011 that Australia had not been handed a so-called Fossil Award by civil society groups.

At each climate conference, Climate Action Network International brands those nations it considers the worst carbon performers as the ‘Fossil of the Day’. Last year, Australia was handed the dubious title of ‘Colossal Fossil’ for the entire COP26 conference in Glasgow.

This year, Australia brought a legislated target to cut carbon emissions by 43% (on 2005 levels) by the end of the decade, and was not named among poor performing nations.

However even that strengthened objective may be insufficient, with the COP27 document recognising a 1.5°C warming cap would require a 43% reduction compared to 2019 levels.

“Limiting global warming to 1.5° C requires rapid, deep and sustained reductions in greenhouse gas emissions of 43% by 2030 relative to the 2019 level,” says Mackey.

“Australia’s current mitigation target is 43% by 2030 relative to the 2005 level. Achieving this revised target will require a fourfold increase in Australia’s emissions in the coming eight years. Are we up to the challenge?”