COP27: the line was held, but little more

Overall Conclusions:

COP27 was more about holding the bar set in Glasgow, rather than making any further strides forward. This is of course disappointing, but sadly not surprising in the face of significant pressure from countries where political will is still wedded to fossil fuel based economies. Even where ambition was successfully maintained, commitment on paper is still not being matched by action on the ground. The major exception to this stasis was the landmark agreement to establish a Loss and Damage Fund, finally heralding some progress on climate justice and perhaps a step forward in restoring trust between richer and poorer countries.

Landmark Agreement on Loss and Damage:

The final hours of COP27 saw a long awaited statement made on loss and damage, which is a highly politically sensitive and controversial topic addressing who pays for climate change impacts. Parties agreed to establish a Loss and Damage Fund to provide financial assistance to developing countries to address climate change impacts on social and physical infrastructure. This is based on the premise that the countries hardest hit by climate change are often those with the lowest capacity to respond and the smallest greenhouse gas contributions. A late change was made to tighten the language on eligibility to those developing countries ‘especially vulnerable to the impacts of climate change’ and to keep the door open to voluntary contributions from big emitters like China and India that are still classified as developing countries under UNFCCC. This change finally secured the support of the EU and USA, enabling consensus to be reached.

Although the hard work is just beginning to establish the mechanisms of the fund, this is a historic moment in a long and heated debate over climate justice and who pays for climate change impacts. In the words of the Climate Change Minister of Pakistan Sherry Rehman, ‘this is not about accepting charity. This is a downpayment on investment in our futures’.

After the bombshell failure to achieve the goal of $100bn in climate finance by 2020, richer countries had a lot of work to do at COP27 to restore trust among the parties. Most developed countries are still falling well short on climate finance pledges, especially for adaptation. The expectation is that the new Loss and Damage Fund will need to be additional to existing climate finance pledges, so countries have even further to go to deliver what is needed and now expected. Few countries have made climate finance pledges for loss and damage thus far, and it is unclear where the funds will come from.

Deforestation and Nature-Based Solutions

COP26 saw unprecedented commitment towards halting and reversing deforestation, and COP27 provided a litmus test on whether this flurry of pledges represented concrete commitments. Forests were addressed in a dedicated section of the COP27 Outcomes document, suggesting that this sector is becoming accepted in official international policy as a core part of climate action. Additionally, and for the first time, the phrase ‘nature-based solutions’ made it into the outcomes document, representing a step forward from Glasgow where it was cut in the final hours.

A new commitment from Brazil to halt deforestation was a much overdue contribution, and extends action on deforestation pledges to all of the world’s major tropical forests. This is likely to unlock increased flows of funding to forest conservation in the Brazilian Amazon, with Norway and Germany already announcing renewed participation in the Amazon Fund.

Another new development at COP27 was the commitment of 27 members of the Forest and Climate Leaders’ Partnership to meet every 6 months to track progress, collaborate, and hold each other accountable on pledges to halt and reverse deforestation. This group accounts for 35% of the world’s forests, but with some notable absences. It is a welcome development as the Glasgow Declaration on Forests did not include any follow up or accountability mechanisms.

The private sector also renewed its commitment to act on deforestation at COP27, with companies in the food sector launching new activities to halt deforestation in their beef, soy, and palm oil supply chains by 2025. Private sector financial support for the Forest and Climate Leaders’ Partnership was also increased.

However, despite the flurry of pledges at COP26, there is little evidence of a measurable uptick in action on deforestation one year on. Current action is insufficient to meet 2030 pledges. With international political commitment now seemingly secure, attention must turn to delivering the results on the ground to halt and reverse deforestation while protecting and strengthening the rights of local communities and indigenous peoples. This simply must be adequately resourced.

Article 6

A disappointing aspect of COP27 was the lack of progress on operationalising Article 6. COP26 finally saw the finalisation of the nine contentious paragraphs of Article 6, but countries still have little clarity on how it will play out in practice and core decisions have been pushed to COP28. The centralised body under Article 6.4 cannot function until its governing guidelines are agreed, and there is still a lack of consensus over how Article 6.2 will function, especially on authorisation, reporting, and accountability requirements. We may see more countries following in the footsteps of Indonesia and pausing voluntary carbon credit issuance while Article 6 market mechanisms and infrastructure are developed.

1.5 Degrees

Commitment to limiting global temperature rise to within 1.5 degrees has survived in the COP27 outcomes text, despite efforts by some parties to pick it apart. The reference to ‘phase down’ of coal also survived, but attempts to strengthen this to ‘phase out’ and to cover all fossil fuels were again rejected. Sadly, some powerful parties are still unwilling to fully commit to a just energy transition despite overwhelming evidence in its favour.

While the 1.5 target remained on paper, national plans for greenhouse gas emissions reduction by 2030 fell far short of putting the world on track to reach this target and avoid irreversible tipping points. On the positive side, this was the first time that a COP outcomes document recognised the risk of reaching those irreversible tipping points and the resulting urgency of action.

Only 30 out of 198 UNFCCC partners submitted updated national emissions reduction plans this year, despite it being an agreed outcome of COP26 for all to do so. We are left again wondering whether the very marginal gains in international political consensus being achieved at the COPs are making any measurable impact on the very real challenges linked to climate change that people around the world are facing on a daily basis. There is a real risk of too little too late.