The past couple of weeks should actually have been a summer break, a little time to take a breather before the hot climate autumn. But with all the reports of wildfires and record temperatures, there was not much of a summer slump around the climate. Now that September is here, any chance to take a breath in the world of climate diplomacy is definitely over – until COP28 in November, there will be conferences and summit meetings galore.
So you don’t get lost between all these events, we’re organizing the most important ones for you: We’re reporting on the demands of African countries at the Africa Climate Summit in Nairobi. Additionally, we’re looking ahead to the G20 summit this weekend in New Delhi. We’re also providing the details on the complex discussions surrounding the loss & damage fund, which is set to be decided at the end of the year.
We have also researched how little the United Arab Emirates – the host of the next COP – is doing to achieve the big goal of methane reduction. Today’s edition of Climate.Table also looks at Germany’s climate targets, potential IPCC reforms, and the hottest summer ever recorded.
Africa’s heads of state and government have agreed on common positions on climate policy. Above all, they call for a new global finance architecture fit to address the climate crisis and spur climate-compatible growth across the continent. This is the central result of the first African climate summit in Nairobi, jointly hosted by Kenya and the African Union from Monday to Wednesday.
The Nairobi Declaration formulates the African position for negotiators at the UN General Assembly in New York in September and at COP28 in Dubai in December. African leaders called for “concrete, time-bound action” to reform the international financial system but noted that reforms alone are “not sufficient to provide the scale of climate financing the world needs.”
In addition, they urged world leaders to “rally behind the proposal for a global carbon taxation regime” to provide climate finance at scale. This could include a carbon tax on fossil fuel trade, shipping and aviation, as well as a global financial transaction tax. This is in line with proposals put forward by Kenyan President William Ruto, who chairs the committee of African Heads of State and Government on Climate Change and has championed a new global finance architecture for climate action.
Ruto billed the summit as a moment to shift the narrative about Africa away from victimhood to positioning the continent as a hub for climate solutions. To tap into its potential and support global decarbonization efforts, Africa needs cheap, long-term financing at a scale that is easy to access.
The international financial system has so far failed to provide this adequately. Access to capital is expensive, interest rates are high, and limited concessional funding has hamstrung African countries’ ability to invest in sustainable development and contributed to debt.
Ruto called for a paradigm shift to ensure developing countries can access financing “in a way that doesn’t punish us.”
“We are not asking to be treated differently. We want a fair financial system that treats everybody equally,” he told the summit.
African countries are calling for:
They also seek help to increase renewables for power generation in Africa from 56 GW (2022) to at least 300 GW by 2030. In addition, the countries decided to raise an additional 23 billion dollars for green growth and climate change adaptation.
But Kenya’s President Ruto wanted to go further. At the Paris Finance Summit in June, he put forward concrete ideas for financing struggling developing economies. He called for new climate finance mechanisms funded with global taxes on fossil fuel, aviation, shipping and financial transactions – and Africa, he said, should pay into these funds too.
But Kenya’s president encountered resistance at the summit in Nairobi, according to sources close to the negotiations. The issue was avoided at the summit. An early draft of the Nairobi Declaration, prepared by the Kenyan government and shared with Climate.Table, included a proposal for a tax on fossil fuel extraction – a touchy issue for some African nations who are gambling on exploiting their oil and gas reserves to finance their country’s development.
At the summit, Ruto made the case for putting a price on carbon. “It’s very controversial. But we need to have a conversation about a carbon tax if we are to raise the scale of financing needed for the energy transition,” he said.
Others agreed. “The carbon tax is an agenda that most will be taking from here to COP28,” said Benedict Oramah, president of the Afrexim Bank.
John Asafu-Adjaye, senior fellow at the African Center for Economic Transformation, said a carbon tax would make the world’s biggest polluters pay the most. But how the revenue is redistributed is key. “Carbon pricing in Africa is appropriate for the bigger economies, but may not raise much finance for low-polluting countries that do not have large industrial sectors,” he said.
The summit also generated criticism. Some negotiators criticized the lack of focus on raising more grant-based financing for adaptation. Others raised concerns Ruto’s call to remove the traditional divides between developed and developing countries would disregard the firmly held principle of common but differentiated responsibilities. This concept assigns countries different levels of responsibility in the fight against climate change based on their historical emissions and income levels. Iskander Vernoit, founding director at the Morocco-based Imal Initiative for Climate & Development, said the African position to the principle of common but differentiated responsibilities remains “unwavering.”
“Expecting countries like Sierra Leone to bear the brunt of a crisis that is scarcely contributed to without robust support from the primary emitters is fundamentally unjust,” said its president, Julius Maada Bio. “Our stance is unequivocal. We are here to collaborate, not to capitulate,” he added, citing the need for rich countries to deliver on their funding commitments to poorer ones.
These concerns intensified after campaigners accused consulting giant McKinsey of hijacking the summit’s priorities and “pushing a pro-West agenda.” McKinsey provided “strategic support” on the design of the summit’s key themes. Kenyan officials insisted the agenda reflected African priorities.
The debate on one of the hottest issues in international climate finance, the new loss and damage fund, is set for a showdown in October. Even at the third meeting of the Transitional Committee last week in the Dominican Republic, the various concepts for the new financial instrument were still far apart. In order to stay on schedule, a decision now has to be made at the Committee’s final meeting. It will be held from 17 to 20 October in Aswan, Egypt.
The goal in Aswan is to find a compromise proposal that can be adopted at COP28 in Dubai in December. That, at least, is the mandate of last year’s COP27, where the surprising decision to set up such an L&D fund and to define its basic features within one year was taken. The UN jargon L&D covers damage caused by climate change that cannot be prevented by adaptation measures, such as recent damage caused by storms or droughts, and also “non-economic losses.”
So far, however, the various official proposals on the table contradict each other on key points:
During the negotiations last week, developing countries named a concrete demand for the amount of the L&D Fund for the first time: 100 billion US dollars annually. This demand caused a stir. The developing countries are referring to a study commissioned by the UN, which estimates possible climate-related damage and losses between 150 and 300 billion US dollars a year. The OECD report is already eagerly awaited this fall, which is supposed to calculate whether the developed countries have kept their promise to mobilize 100 billion US dollars per year for climate aid to the Global South in 2022. The money for the L&D Fund is to flow independently of the sum already pledged.
The US proposal regarding the composition of the board also created tensions. Because if the “biggest donors” are developed countries or institutions like the World Bank, they would have a maximum of 14 votes compared to 11 votes from developing countries. Foundations, NGOs, indigenous peoples and companies would then tip the scales. That would be a “lopsided” design, Harjeet Singh from the Climate Action Network (CAN) told the portal Climate Home News. “For us, it’s rich, developed countries. We can not move away from historic responsibility. We need to recognize the reason we are facing loss and damage is because of actions and inaction over the last 30 years.”
However, it is not specified who these “biggest donors” are – meaning that it could well be states such as China, Korea or the Arab oil states that could buy themselves a seat at the table here. And that would probably be fine with the classic developed countries, which are pushing these polluters to contribute to climate finance. In general, the dispute demonstrates the distrust between the blocs: Developing countries fear that the North will once again not keep its promises. The Global North, in turn, does not trust the South to use the funds efficiently and to fight corruption effectively, for instance.
The dispute in the Committee over the structure of the fund will center on these issues at the last meeting:
“The mood at the meeting was constructive, but so far only the different concepts have been presented,” says Laura Schäfer, who observes the talks for Germanwatch. “Now compromises have to be found on the most important issues. A lot of work still awaits the Committee in its last meeting.”
NGOs also complained to the UN that the first two of the four days of meetings were held behind closed doors. “We find extremely appalling the way the participation process has been conducted by the UNFCCC Secretariat in the Transitional Committee process,” they wrote in an open letter. “We formally complain that our access rights are being infringed. The UNFCCC Secretariat has a long way to go to ensure our participation in the process, is meaningful and effective according to our human rights.”
The G20 meeting in New Delhi this coming weekend will yield little progress on climate policy. However, despite the recognition of the urgency of the climate crisis and the need to accelerate the energy transition, geopolitics will likely hobble any major and meaningful outcome. The working group ministerial meetings have demonstrated the unwillingness of countries to find common ground.
Two important countries are not represented at a high level in New Delhi: Russian President Vladimir Putin does not want to leave his country because of the Ukraine war. China’s President Xi Jinping has opted not to attend the meeting. However, India maintains that all this is par for course. That makes building consensus for landmark decisions difficult. “Together the G20 have the moral responsibility and the economic heft to slow global warming. Yet hopes for bolder climate action from the G20 this year have so far been hamstrung by geopolitical spats between major powers,” said Tom Evans, Policy Advisor, Climate Diplomacy and Geopolitics at the Berlin-based think tank, E3G.
India has made efforts to find common approaches to tackling climate change, accelerating the energy transition, and ensuring a just transition. To do so, the G20 should focus on improving access to climate and development finance. That was the plan for the meeting in India during the world’s hottest summer and driest August in more than a century. The world’s 20 largest economies account for about 80 percent of global economic output and 75 percent of annual greenhouse gas emissions.
In December last year, Prime Minister Narendra Modi described climate change along with terrorism and pandemics, as the “greatest challenges” the world faces that “can be solved not by fighting each other, but only by acting together.”
One of the countries that try to slow down efforts is Russia. Russian Foreign Minister Sergei Lavrov, who will attend the summit, has said that Russia will block a declaration unless it reflects Moscow’s position on Ukraine and other crises. While China has supported the Russian objections, it has also raised specific substantive objections in the climate and energy working groups. The Chinese objections are reflective of broader geopolitical struggles particularly with the United States and its relationship with India. For instance, China has objected to India’s initiative on lifestyles for the environment, and language on fossil fuel phase down language.
“The G20 has been hamstrung by US-China competition and the Russia-Ukraine conflict. This makes moving the global agenda forward extremely challenging on this platform. Climate change risks becoming a collateral damage at this year’s summit in India. Preparatory talks have exposed deep divisions,” said Li Shuo, Senior Global Policy Advisor with Greenpeace East Asia.
With days to the summit, India is pushing for the declaration to show a measure of ambition on addressing climate change. Specifically, there is a push for language on fossil fuel phase down that goes beyond coal. Sources told Climate Table, even at the Goa ministerial of the energy transition working group, the issue of fossil fuel phasedown came in for strong opposition not just from oil and gas producing countries but developing countries such as China, South Africa and Brazil. However, the pushback was reportedly primarily by China and Saudi Arabia at the Climate ministerial in Chennai. These fault lines continue to persist at the sherpa level negotiations.
Another issue that India is keen to include the tripling of renewable energy capacity and doubling of energy efficiency targets in the G20 joint declaration. The European members of the G20 and the European Union support the presidency but failed to find support beyond the EU.
Finance will be the issue to watch out for at the Summit, a priority for the Indian G20 presidency. “The Indian presidency has been able to call out the problems with multilateral funding facilities as well as industrial policy. The demand for fair share of finance from developing countries will build pressure to raise ambition on the scale of concessional finance made available over the years to come,” said Suranjali Tandon, Associate Professor, National Institute of Public Finance and Policy.
The G20 Finance Deputies met on Tuesday to discuss debt distress of vulnerable countries. Sources said that China, a large creditor to developing countries, does not agree with a common understanding on debt resolution for vulnerable nations. Beijing is reportedly opposed to reducing interest rates and is pushing for wider reforms of multilateral development banks.
Dhruba Purkayastha, India Director, Climate Policy Initiative said that the G20 “can bring alignment around a few items around the reforms needed in MDBs. MDBs need a new financial architecture. There needs to be a mechanism that will also bring in the IMF by recycling SDRs, which has already been a model in the resilience and sustainability trust. The outcome documents from the governors’ meeting show that they all align in the need for MDB reforms. But what is lacking is institutionalization of the concepts and principles that have been known to us through the Bridgetown initiative, capital adequacy framework or the global financial pact. If possible, the G20 should drive this.”
The joint declaration is expected to include references to “fuels of the future” with specific mention to green hydrogen and biofuels. An announcement to set up a Green Hydrogen Innovation Center and a Global Biofuels Alliance is expected.
However, there was silence on fossil fuel subsidies during preparatory meetings. There are indications that China is negotiating to delete reference to the 2009 G20 commitment to phase out inefficient fossil fuel subsidies. A recent report found the G20 handed 1.4 trillion US dollars in public funds to support fossil fuels. India could take a lead on the issue considering that it reduced its fossil fuel subsidies by 76 percent from 2014 to 2022 while significantly increasing support for clean energy.
Pressure to do so is also coming from civil society. The G20 should set “a clear timeline to end public support for fossil fuels,” said Shruti Sharma, Senior Policy Advisor with the International Institute for Sustainable Development. The pledge to phase out fossil fuel subsidies must be extended to all public support for fossil fuels, he said. This includes investments by state-owned enterprises, public loans and annual reporting on these public subsidies.
A global methane emissions reduction target is currently emerging as a potential key outcome of COP28, and COP president-elect Sultan al Jaber has mentioned the issue in numerous speeches over the past few months. Al Jaber, who is also the minister of industry for the United Arab Emirates (UAE) and head of the state-owned energy company Adnoc, is calling for a gradual phase-out of methane emissions from the oil and gas industry by 2030.
Many Western negotiators will welcome this demand. US climate negotiator John Kerry is pushing the methane issue and is receiving a lot of backing from US President Joe Biden. The EU wants to regulate the sector more. And even China approached the US on methane at the last climate conference. International organizations such as the IEA and UNEP have been calling for more haste for some time.
But the UAE itself is not doing much to lower its methane emissions. A Guardian investigation shows that the Emirates do not report their emissions to the UN. In fact, the UN has required a methane report every two years since 2014. However, unlike other oil states in the region, such as Saudi Arabia, Kuwait and Oman, the UAE has yet to present a report. The lack of transparency shows: The UAE is a poor role model for other states.
In addition, the Emirates is one of the countries with high methane emissions from oil and gas production. According to a study, the sector’s methane emissions are 3.3 percent – that is, 3.3 percent of the natural gas extracted during oil and gas production escapes into the atmosphere instead of being put on the market. Oil production in the Emirates thus generates particularly high methane emissions. Although emissions in the Emirates are only slightly higher than those from US oil and gas fields, they are far higher than those from Saudi Arabia (0.14 percent) or Qatar (0.06 percent).
According to the International Energy Agency (IEA), 37 percent of the UAE’s methane emissions could be avoided at no additional cost. That means selling the captured methane on gas markets could recoup the cost of new infrastructure or closing leaks. However, according to the IEA, the UAE has neither a roadmap to reduce emissions nor a reduction target. Nor is there much regulation on venting and flaring, the IEA says.
The UAE’s poor methane track record and lack of transparency chips away at the credibility of the COP host. Al Jaber’s insistence on lowering “methane emissions towards zero” from the oil and gas industry by 2030 can be considered a concession to the groups of countries pushing for more climate action. The COP president-elect wants to accommodate, for example, the EU on this issue and could thus lower political pressure on a critical concern for the UAE – the complete phase-out of fossil fuel production. But, since the UAE is one of the laggards on methane emissions, al Jaber’s negotiating position could be weakened.
In addition, many countries have recently taken steps to reduce methane emissions. More than 30 percent of the temperature increase since the Industrial Revolution can be traced back to methane. Over a 20-year period, this greenhouse gas is 80 times more harmful than carbon dioxide (CO2).
In the United States, methane emissions regulation in the oil and gas sector was “somewhat limited” for a long time. Under the Trump presidency, regulation of the sector stalled. However, President Joe Biden has put some measures in place:
The new EPA regulations will “significantly reduce” methane leaks, Doniger told Table.Media. He sees the methane tax as an “important complement” to EPA regulations. It will “motivate companies to comply with the regulations to avoid the tax.”
The EU has also been working on a new methane regulation for the energy sector since late 2021. According to an EU Commission proposal, domestic oil, gas and coal producers are to better measure and report on methane emissions. Methane leaks are to be monitored more closely and repaired more quickly. The venting and burning of methane are to be limited.
The Commission also wants to better monitor emissions from imported gas, oil and coal. To achieve this, importers are to disclose reports on methane emissions. The draft regulation includes a review clause. Once sufficient emissions data on imported energy commodities is available, stricter measures could be added to the regulation. The greater transparency is intended to entice producer countries to increase their efforts.
The EU Parliament is calling for stricter regulation. Accordingly, regulations for EU countries should also apply to gas, oil and coal imported from outside the EU. Importing businesses are to prove from 2026 onward that exporters comply with obligations on “monitoring, reporting, and verification, leak detection and repair.” EU member states are to ensure that importers provide the respective evidence. Under the parliamentary proposal, methane venting is to be banned entirely. Flaring is to be permitted only in emergencies. In addition, the proposal includes repair obligations in the event of leaks and a target for emissions reductions by the end of 2025. The EU covers more than 80 percent of its gas and oil needs with imports. Extending regulation beyond the EU’s borders would have a significant steering effect. The two proposals still have to be brought to a compromise in trilogue negotiations.
This year’s summer in the Northern Hemisphere between June and August was the hottest since records began, with a global-mean temperature of 16.77 degrees Celsius. This value is 0.66 degrees above the long-term average. This is the result of an evaluation by the EU’s Copernicus Climate Change Services (C3S).
Global temperatures have been high since the beginning of the year: Currently, 2023 is the second hottest year after 2016. The high mean temperatures are just one of many alarming indicators: Sea surface temperatures have also recently reached record levels, while sea ice extent has declined sharply at the same time. kul
The German government’s climate policy will reduce Germany’s future emissions more than earlier projections had predicted. Nevertheless, the result remains “insufficient.” To achieve the 1.5-degree limit, Germany’s climate policy and targets would have to be “significantly improved.” This is the conclusion of a recent analysis by the Climate Action Tracker (CAT). The New Climate Institute and Climate Analytics regularly evaluate the climate policies of more than 40 countries in the context of the UNFCCC negotiation process.
The analysis continues that the party dispute within the German government is jeopardizing achieving the climate protection targets. In response, climate scientist Niklas Höhne of the New Climate Institute says it appears the coalition has abandoned the 2030 target. He called it “inadequate” that Germany, as one of the world’s wealthiest countries, is “failing to implement even simple measures such as a general speed limit on freeways, as the world experiences record high temperatures and devastating climate impacts.”
Specifically, the CAT sees two positive developments in German climate policy:
On the other hand, there are five negative aspects:
The update of the Climate Action Tracker follows the publication of the 2023 Projection Report by the Federal Environment Agency and the report by the country’s Council of Experts on Climate Change. These two reports also concluded that Germany would not achieve its climate targets under current policies. ae
Fueled by El Niño, the climate crisis is raging in Europe: While one side of the continent is experiencing drought and wildfires, severe storms are causing local storms, heavy rain, floods and landslides elsewhere. The result is deaths and injuries and billions of euros in damage.
Meanwhile, the geopolitical situation is changing rapidly. Multiple, intertwined global crises are particularly hitting marginalized people in the Global South. The Russian war of aggression against Ukraine has drastically changed the global security architecture. China is gaining support for building a counterpole to the existing (Western) community of values and economies. The expansion of BRICS to include primarily autocratic countries that rely on fossil fuel extraction also bears the signature of China’s ruler, Xi. He is sending another signal of separation by prioritizing the BRICS summit and deciding not to attend the G20 summit.
In recent years, far-reaching agreements in the G20, originally the central global North-South forum, have become difficult – including in climate policy. Nevertheless, the G20 accounts for around 80 percent of global GDP and emits about 80 percent of global emissions. The summit will set the course for high-level political forums in the coming months, such as the UN General Assembly and the UN Secretary-General’s Climate Ambition Summit, the annual meeting of the World Bank and IMF, and the UN climate summit COP28.
To safeguard Germany’s interests, the German government must work to overcome the dysfunctional current North-South geopolitics and replace it with a stable and equitable multilateral system with shared global goals. As Chancellor, Olaf Scholz has a responsibility to take a leadership role in global climate change and solidarity at the G20 summit.
In New Delhi, Scholz must call for a phase-out of fossil fuels and present offers to Germany’s partners in the Global South. As a Social Democrat, he can count on the German Social Democratic Party in the Bundestag to help him achieve this. A socially just phase-out of fossil fuels, comprehensive climate financing and a global stocktake of what the UN member states have achieved or not achieved so far in their climate policy are part of the contours of social democratic international climate policy.
Progress needs to be made in three fields:
The global community must commit to the triad of phasing out fossil fuels, massively expanding renewable energy capacities and increasing energy efficiency. This requires additional financial aid from the developed countries. By 2030, wind and solar capacity must be installed five times faster – at a rate of 1.5 terawatts (TW) annually – to limit warming to 1.5 degrees.
It is positive that the German Chancellor already supports a global target for the expansion of renewables. The energy transition is a global growth opportunity. However, effective climate action is only possible if fossil fuels are phased out simultaneously. The Chancellor must clearly state this obvious necessity at the G20 summit.
It is high time to go beyond the historic agreement on the global coal phase-out of COP26 and to include oil and gas. Here, CCS and abatement technologies are not suitable options for the energy sector, and their useful applications must be clearly defined and limited, for example, based on the IPCC.
In its current form, the international financial architecture (IFA) is not built to meet the challenges of our time. Its institutions are in need of fundamental reform. Fiscal space and public and private investment for the climate transition in developing countries are lacking. There is not enough aid and debt clauses that take the climate crisis into account. In the G20, the various reform proposals need to be tied together and advanced.
Germany’s international partners have reacted very positively to the participation of the German Chancellor, as the only head of state and government of a developed country besides France’s President, in the “Summit for a New Financial Pact.” The reform agenda was also a topic at the Africa Climate Summit in Nairobi and the Finance in Common Summit in Cartagena this week. The task is to stay on it and quickly and comprehensively drive the initiated reforms forward. In the process, the Chancellor should also support innovative proposals from the Global South, such as the Bridgetown Initiative and the Expert Review on Debt, Nature and Climate.
The G20 can provide important impetus for the COP28 Global Stocktake to initiate a course correction in global climate action. The Chancellor should join calls for ambitious national reduction targets for 2030 and 2035 that are compatible with the 1.5-degree limit, a global milestone target of minus 60 percent by 2035, an investment and subsidy shift from fossil to renewable energy by 2025, and the transformation of food systems and land use.
In these times of global crises and geopolitical upheaval, Germany should make a solid international contribution out of its own self-interest. As Chancellor and Social Democrat, Olaf Scholz must, therefore, consistently campaign for an ambitious and equitable global climate transition at the G20 summit.
Steffen Menzel is Programme Lead for Climate Diplomacy and Geopolitics at think tank E3G.
The past couple of weeks should actually have been a summer break, a little time to take a breather before the hot climate autumn. But with all the reports of wildfires and record temperatures, there was not much of a summer slump around the climate. Now that September is here, any chance to take a breath in the world of climate diplomacy is definitely over – until COP28 in November, there will be conferences and summit meetings galore.
So you don’t get lost between all these events, we’re organizing the most important ones for you: We’re reporting on the demands of African countries at the Africa Climate Summit in Nairobi. Additionally, we’re looking ahead to the G20 summit this weekend in New Delhi. We’re also providing the details on the complex discussions surrounding the loss & damage fund, which is set to be decided at the end of the year.
We have also researched how little the United Arab Emirates – the host of the next COP – is doing to achieve the big goal of methane reduction. Today’s edition of Climate.Table also looks at Germany’s climate targets, potential IPCC reforms, and the hottest summer ever recorded.
Africa’s heads of state and government have agreed on common positions on climate policy. Above all, they call for a new global finance architecture fit to address the climate crisis and spur climate-compatible growth across the continent. This is the central result of the first African climate summit in Nairobi, jointly hosted by Kenya and the African Union from Monday to Wednesday.
The Nairobi Declaration formulates the African position for negotiators at the UN General Assembly in New York in September and at COP28 in Dubai in December. African leaders called for “concrete, time-bound action” to reform the international financial system but noted that reforms alone are “not sufficient to provide the scale of climate financing the world needs.”
In addition, they urged world leaders to “rally behind the proposal for a global carbon taxation regime” to provide climate finance at scale. This could include a carbon tax on fossil fuel trade, shipping and aviation, as well as a global financial transaction tax. This is in line with proposals put forward by Kenyan President William Ruto, who chairs the committee of African Heads of State and Government on Climate Change and has championed a new global finance architecture for climate action.
Ruto billed the summit as a moment to shift the narrative about Africa away from victimhood to positioning the continent as a hub for climate solutions. To tap into its potential and support global decarbonization efforts, Africa needs cheap, long-term financing at a scale that is easy to access.
The international financial system has so far failed to provide this adequately. Access to capital is expensive, interest rates are high, and limited concessional funding has hamstrung African countries’ ability to invest in sustainable development and contributed to debt.
Ruto called for a paradigm shift to ensure developing countries can access financing “in a way that doesn’t punish us.”
“We are not asking to be treated differently. We want a fair financial system that treats everybody equally,” he told the summit.
African countries are calling for:
They also seek help to increase renewables for power generation in Africa from 56 GW (2022) to at least 300 GW by 2030. In addition, the countries decided to raise an additional 23 billion dollars for green growth and climate change adaptation.
But Kenya’s President Ruto wanted to go further. At the Paris Finance Summit in June, he put forward concrete ideas for financing struggling developing economies. He called for new climate finance mechanisms funded with global taxes on fossil fuel, aviation, shipping and financial transactions – and Africa, he said, should pay into these funds too.
But Kenya’s president encountered resistance at the summit in Nairobi, according to sources close to the negotiations. The issue was avoided at the summit. An early draft of the Nairobi Declaration, prepared by the Kenyan government and shared with Climate.Table, included a proposal for a tax on fossil fuel extraction – a touchy issue for some African nations who are gambling on exploiting their oil and gas reserves to finance their country’s development.
At the summit, Ruto made the case for putting a price on carbon. “It’s very controversial. But we need to have a conversation about a carbon tax if we are to raise the scale of financing needed for the energy transition,” he said.
Others agreed. “The carbon tax is an agenda that most will be taking from here to COP28,” said Benedict Oramah, president of the Afrexim Bank.
John Asafu-Adjaye, senior fellow at the African Center for Economic Transformation, said a carbon tax would make the world’s biggest polluters pay the most. But how the revenue is redistributed is key. “Carbon pricing in Africa is appropriate for the bigger economies, but may not raise much finance for low-polluting countries that do not have large industrial sectors,” he said.
The summit also generated criticism. Some negotiators criticized the lack of focus on raising more grant-based financing for adaptation. Others raised concerns Ruto’s call to remove the traditional divides between developed and developing countries would disregard the firmly held principle of common but differentiated responsibilities. This concept assigns countries different levels of responsibility in the fight against climate change based on their historical emissions and income levels. Iskander Vernoit, founding director at the Morocco-based Imal Initiative for Climate & Development, said the African position to the principle of common but differentiated responsibilities remains “unwavering.”
“Expecting countries like Sierra Leone to bear the brunt of a crisis that is scarcely contributed to without robust support from the primary emitters is fundamentally unjust,” said its president, Julius Maada Bio. “Our stance is unequivocal. We are here to collaborate, not to capitulate,” he added, citing the need for rich countries to deliver on their funding commitments to poorer ones.
These concerns intensified after campaigners accused consulting giant McKinsey of hijacking the summit’s priorities and “pushing a pro-West agenda.” McKinsey provided “strategic support” on the design of the summit’s key themes. Kenyan officials insisted the agenda reflected African priorities.
The debate on one of the hottest issues in international climate finance, the new loss and damage fund, is set for a showdown in October. Even at the third meeting of the Transitional Committee last week in the Dominican Republic, the various concepts for the new financial instrument were still far apart. In order to stay on schedule, a decision now has to be made at the Committee’s final meeting. It will be held from 17 to 20 October in Aswan, Egypt.
The goal in Aswan is to find a compromise proposal that can be adopted at COP28 in Dubai in December. That, at least, is the mandate of last year’s COP27, where the surprising decision to set up such an L&D fund and to define its basic features within one year was taken. The UN jargon L&D covers damage caused by climate change that cannot be prevented by adaptation measures, such as recent damage caused by storms or droughts, and also “non-economic losses.”
So far, however, the various official proposals on the table contradict each other on key points:
During the negotiations last week, developing countries named a concrete demand for the amount of the L&D Fund for the first time: 100 billion US dollars annually. This demand caused a stir. The developing countries are referring to a study commissioned by the UN, which estimates possible climate-related damage and losses between 150 and 300 billion US dollars a year. The OECD report is already eagerly awaited this fall, which is supposed to calculate whether the developed countries have kept their promise to mobilize 100 billion US dollars per year for climate aid to the Global South in 2022. The money for the L&D Fund is to flow independently of the sum already pledged.
The US proposal regarding the composition of the board also created tensions. Because if the “biggest donors” are developed countries or institutions like the World Bank, they would have a maximum of 14 votes compared to 11 votes from developing countries. Foundations, NGOs, indigenous peoples and companies would then tip the scales. That would be a “lopsided” design, Harjeet Singh from the Climate Action Network (CAN) told the portal Climate Home News. “For us, it’s rich, developed countries. We can not move away from historic responsibility. We need to recognize the reason we are facing loss and damage is because of actions and inaction over the last 30 years.”
However, it is not specified who these “biggest donors” are – meaning that it could well be states such as China, Korea or the Arab oil states that could buy themselves a seat at the table here. And that would probably be fine with the classic developed countries, which are pushing these polluters to contribute to climate finance. In general, the dispute demonstrates the distrust between the blocs: Developing countries fear that the North will once again not keep its promises. The Global North, in turn, does not trust the South to use the funds efficiently and to fight corruption effectively, for instance.
The dispute in the Committee over the structure of the fund will center on these issues at the last meeting:
“The mood at the meeting was constructive, but so far only the different concepts have been presented,” says Laura Schäfer, who observes the talks for Germanwatch. “Now compromises have to be found on the most important issues. A lot of work still awaits the Committee in its last meeting.”
NGOs also complained to the UN that the first two of the four days of meetings were held behind closed doors. “We find extremely appalling the way the participation process has been conducted by the UNFCCC Secretariat in the Transitional Committee process,” they wrote in an open letter. “We formally complain that our access rights are being infringed. The UNFCCC Secretariat has a long way to go to ensure our participation in the process, is meaningful and effective according to our human rights.”
The G20 meeting in New Delhi this coming weekend will yield little progress on climate policy. However, despite the recognition of the urgency of the climate crisis and the need to accelerate the energy transition, geopolitics will likely hobble any major and meaningful outcome. The working group ministerial meetings have demonstrated the unwillingness of countries to find common ground.
Two important countries are not represented at a high level in New Delhi: Russian President Vladimir Putin does not want to leave his country because of the Ukraine war. China’s President Xi Jinping has opted not to attend the meeting. However, India maintains that all this is par for course. That makes building consensus for landmark decisions difficult. “Together the G20 have the moral responsibility and the economic heft to slow global warming. Yet hopes for bolder climate action from the G20 this year have so far been hamstrung by geopolitical spats between major powers,” said Tom Evans, Policy Advisor, Climate Diplomacy and Geopolitics at the Berlin-based think tank, E3G.
India has made efforts to find common approaches to tackling climate change, accelerating the energy transition, and ensuring a just transition. To do so, the G20 should focus on improving access to climate and development finance. That was the plan for the meeting in India during the world’s hottest summer and driest August in more than a century. The world’s 20 largest economies account for about 80 percent of global economic output and 75 percent of annual greenhouse gas emissions.
In December last year, Prime Minister Narendra Modi described climate change along with terrorism and pandemics, as the “greatest challenges” the world faces that “can be solved not by fighting each other, but only by acting together.”
One of the countries that try to slow down efforts is Russia. Russian Foreign Minister Sergei Lavrov, who will attend the summit, has said that Russia will block a declaration unless it reflects Moscow’s position on Ukraine and other crises. While China has supported the Russian objections, it has also raised specific substantive objections in the climate and energy working groups. The Chinese objections are reflective of broader geopolitical struggles particularly with the United States and its relationship with India. For instance, China has objected to India’s initiative on lifestyles for the environment, and language on fossil fuel phase down language.
“The G20 has been hamstrung by US-China competition and the Russia-Ukraine conflict. This makes moving the global agenda forward extremely challenging on this platform. Climate change risks becoming a collateral damage at this year’s summit in India. Preparatory talks have exposed deep divisions,” said Li Shuo, Senior Global Policy Advisor with Greenpeace East Asia.
With days to the summit, India is pushing for the declaration to show a measure of ambition on addressing climate change. Specifically, there is a push for language on fossil fuel phase down that goes beyond coal. Sources told Climate Table, even at the Goa ministerial of the energy transition working group, the issue of fossil fuel phasedown came in for strong opposition not just from oil and gas producing countries but developing countries such as China, South Africa and Brazil. However, the pushback was reportedly primarily by China and Saudi Arabia at the Climate ministerial in Chennai. These fault lines continue to persist at the sherpa level negotiations.
Another issue that India is keen to include the tripling of renewable energy capacity and doubling of energy efficiency targets in the G20 joint declaration. The European members of the G20 and the European Union support the presidency but failed to find support beyond the EU.
Finance will be the issue to watch out for at the Summit, a priority for the Indian G20 presidency. “The Indian presidency has been able to call out the problems with multilateral funding facilities as well as industrial policy. The demand for fair share of finance from developing countries will build pressure to raise ambition on the scale of concessional finance made available over the years to come,” said Suranjali Tandon, Associate Professor, National Institute of Public Finance and Policy.
The G20 Finance Deputies met on Tuesday to discuss debt distress of vulnerable countries. Sources said that China, a large creditor to developing countries, does not agree with a common understanding on debt resolution for vulnerable nations. Beijing is reportedly opposed to reducing interest rates and is pushing for wider reforms of multilateral development banks.
Dhruba Purkayastha, India Director, Climate Policy Initiative said that the G20 “can bring alignment around a few items around the reforms needed in MDBs. MDBs need a new financial architecture. There needs to be a mechanism that will also bring in the IMF by recycling SDRs, which has already been a model in the resilience and sustainability trust. The outcome documents from the governors’ meeting show that they all align in the need for MDB reforms. But what is lacking is institutionalization of the concepts and principles that have been known to us through the Bridgetown initiative, capital adequacy framework or the global financial pact. If possible, the G20 should drive this.”
The joint declaration is expected to include references to “fuels of the future” with specific mention to green hydrogen and biofuels. An announcement to set up a Green Hydrogen Innovation Center and a Global Biofuels Alliance is expected.
However, there was silence on fossil fuel subsidies during preparatory meetings. There are indications that China is negotiating to delete reference to the 2009 G20 commitment to phase out inefficient fossil fuel subsidies. A recent report found the G20 handed 1.4 trillion US dollars in public funds to support fossil fuels. India could take a lead on the issue considering that it reduced its fossil fuel subsidies by 76 percent from 2014 to 2022 while significantly increasing support for clean energy.
Pressure to do so is also coming from civil society. The G20 should set “a clear timeline to end public support for fossil fuels,” said Shruti Sharma, Senior Policy Advisor with the International Institute for Sustainable Development. The pledge to phase out fossil fuel subsidies must be extended to all public support for fossil fuels, he said. This includes investments by state-owned enterprises, public loans and annual reporting on these public subsidies.
A global methane emissions reduction target is currently emerging as a potential key outcome of COP28, and COP president-elect Sultan al Jaber has mentioned the issue in numerous speeches over the past few months. Al Jaber, who is also the minister of industry for the United Arab Emirates (UAE) and head of the state-owned energy company Adnoc, is calling for a gradual phase-out of methane emissions from the oil and gas industry by 2030.
Many Western negotiators will welcome this demand. US climate negotiator John Kerry is pushing the methane issue and is receiving a lot of backing from US President Joe Biden. The EU wants to regulate the sector more. And even China approached the US on methane at the last climate conference. International organizations such as the IEA and UNEP have been calling for more haste for some time.
But the UAE itself is not doing much to lower its methane emissions. A Guardian investigation shows that the Emirates do not report their emissions to the UN. In fact, the UN has required a methane report every two years since 2014. However, unlike other oil states in the region, such as Saudi Arabia, Kuwait and Oman, the UAE has yet to present a report. The lack of transparency shows: The UAE is a poor role model for other states.
In addition, the Emirates is one of the countries with high methane emissions from oil and gas production. According to a study, the sector’s methane emissions are 3.3 percent – that is, 3.3 percent of the natural gas extracted during oil and gas production escapes into the atmosphere instead of being put on the market. Oil production in the Emirates thus generates particularly high methane emissions. Although emissions in the Emirates are only slightly higher than those from US oil and gas fields, they are far higher than those from Saudi Arabia (0.14 percent) or Qatar (0.06 percent).
According to the International Energy Agency (IEA), 37 percent of the UAE’s methane emissions could be avoided at no additional cost. That means selling the captured methane on gas markets could recoup the cost of new infrastructure or closing leaks. However, according to the IEA, the UAE has neither a roadmap to reduce emissions nor a reduction target. Nor is there much regulation on venting and flaring, the IEA says.
The UAE’s poor methane track record and lack of transparency chips away at the credibility of the COP host. Al Jaber’s insistence on lowering “methane emissions towards zero” from the oil and gas industry by 2030 can be considered a concession to the groups of countries pushing for more climate action. The COP president-elect wants to accommodate, for example, the EU on this issue and could thus lower political pressure on a critical concern for the UAE – the complete phase-out of fossil fuel production. But, since the UAE is one of the laggards on methane emissions, al Jaber’s negotiating position could be weakened.
In addition, many countries have recently taken steps to reduce methane emissions. More than 30 percent of the temperature increase since the Industrial Revolution can be traced back to methane. Over a 20-year period, this greenhouse gas is 80 times more harmful than carbon dioxide (CO2).
In the United States, methane emissions regulation in the oil and gas sector was “somewhat limited” for a long time. Under the Trump presidency, regulation of the sector stalled. However, President Joe Biden has put some measures in place:
The new EPA regulations will “significantly reduce” methane leaks, Doniger told Table.Media. He sees the methane tax as an “important complement” to EPA regulations. It will “motivate companies to comply with the regulations to avoid the tax.”
The EU has also been working on a new methane regulation for the energy sector since late 2021. According to an EU Commission proposal, domestic oil, gas and coal producers are to better measure and report on methane emissions. Methane leaks are to be monitored more closely and repaired more quickly. The venting and burning of methane are to be limited.
The Commission also wants to better monitor emissions from imported gas, oil and coal. To achieve this, importers are to disclose reports on methane emissions. The draft regulation includes a review clause. Once sufficient emissions data on imported energy commodities is available, stricter measures could be added to the regulation. The greater transparency is intended to entice producer countries to increase their efforts.
The EU Parliament is calling for stricter regulation. Accordingly, regulations for EU countries should also apply to gas, oil and coal imported from outside the EU. Importing businesses are to prove from 2026 onward that exporters comply with obligations on “monitoring, reporting, and verification, leak detection and repair.” EU member states are to ensure that importers provide the respective evidence. Under the parliamentary proposal, methane venting is to be banned entirely. Flaring is to be permitted only in emergencies. In addition, the proposal includes repair obligations in the event of leaks and a target for emissions reductions by the end of 2025. The EU covers more than 80 percent of its gas and oil needs with imports. Extending regulation beyond the EU’s borders would have a significant steering effect. The two proposals still have to be brought to a compromise in trilogue negotiations.
This year’s summer in the Northern Hemisphere between June and August was the hottest since records began, with a global-mean temperature of 16.77 degrees Celsius. This value is 0.66 degrees above the long-term average. This is the result of an evaluation by the EU’s Copernicus Climate Change Services (C3S).
Global temperatures have been high since the beginning of the year: Currently, 2023 is the second hottest year after 2016. The high mean temperatures are just one of many alarming indicators: Sea surface temperatures have also recently reached record levels, while sea ice extent has declined sharply at the same time. kul
The German government’s climate policy will reduce Germany’s future emissions more than earlier projections had predicted. Nevertheless, the result remains “insufficient.” To achieve the 1.5-degree limit, Germany’s climate policy and targets would have to be “significantly improved.” This is the conclusion of a recent analysis by the Climate Action Tracker (CAT). The New Climate Institute and Climate Analytics regularly evaluate the climate policies of more than 40 countries in the context of the UNFCCC negotiation process.
The analysis continues that the party dispute within the German government is jeopardizing achieving the climate protection targets. In response, climate scientist Niklas Höhne of the New Climate Institute says it appears the coalition has abandoned the 2030 target. He called it “inadequate” that Germany, as one of the world’s wealthiest countries, is “failing to implement even simple measures such as a general speed limit on freeways, as the world experiences record high temperatures and devastating climate impacts.”
Specifically, the CAT sees two positive developments in German climate policy:
On the other hand, there are five negative aspects:
The update of the Climate Action Tracker follows the publication of the 2023 Projection Report by the Federal Environment Agency and the report by the country’s Council of Experts on Climate Change. These two reports also concluded that Germany would not achieve its climate targets under current policies. ae
Fueled by El Niño, the climate crisis is raging in Europe: While one side of the continent is experiencing drought and wildfires, severe storms are causing local storms, heavy rain, floods and landslides elsewhere. The result is deaths and injuries and billions of euros in damage.
Meanwhile, the geopolitical situation is changing rapidly. Multiple, intertwined global crises are particularly hitting marginalized people in the Global South. The Russian war of aggression against Ukraine has drastically changed the global security architecture. China is gaining support for building a counterpole to the existing (Western) community of values and economies. The expansion of BRICS to include primarily autocratic countries that rely on fossil fuel extraction also bears the signature of China’s ruler, Xi. He is sending another signal of separation by prioritizing the BRICS summit and deciding not to attend the G20 summit.
In recent years, far-reaching agreements in the G20, originally the central global North-South forum, have become difficult – including in climate policy. Nevertheless, the G20 accounts for around 80 percent of global GDP and emits about 80 percent of global emissions. The summit will set the course for high-level political forums in the coming months, such as the UN General Assembly and the UN Secretary-General’s Climate Ambition Summit, the annual meeting of the World Bank and IMF, and the UN climate summit COP28.
To safeguard Germany’s interests, the German government must work to overcome the dysfunctional current North-South geopolitics and replace it with a stable and equitable multilateral system with shared global goals. As Chancellor, Olaf Scholz has a responsibility to take a leadership role in global climate change and solidarity at the G20 summit.
In New Delhi, Scholz must call for a phase-out of fossil fuels and present offers to Germany’s partners in the Global South. As a Social Democrat, he can count on the German Social Democratic Party in the Bundestag to help him achieve this. A socially just phase-out of fossil fuels, comprehensive climate financing and a global stocktake of what the UN member states have achieved or not achieved so far in their climate policy are part of the contours of social democratic international climate policy.
Progress needs to be made in three fields:
The global community must commit to the triad of phasing out fossil fuels, massively expanding renewable energy capacities and increasing energy efficiency. This requires additional financial aid from the developed countries. By 2030, wind and solar capacity must be installed five times faster – at a rate of 1.5 terawatts (TW) annually – to limit warming to 1.5 degrees.
It is positive that the German Chancellor already supports a global target for the expansion of renewables. The energy transition is a global growth opportunity. However, effective climate action is only possible if fossil fuels are phased out simultaneously. The Chancellor must clearly state this obvious necessity at the G20 summit.
It is high time to go beyond the historic agreement on the global coal phase-out of COP26 and to include oil and gas. Here, CCS and abatement technologies are not suitable options for the energy sector, and their useful applications must be clearly defined and limited, for example, based on the IPCC.
In its current form, the international financial architecture (IFA) is not built to meet the challenges of our time. Its institutions are in need of fundamental reform. Fiscal space and public and private investment for the climate transition in developing countries are lacking. There is not enough aid and debt clauses that take the climate crisis into account. In the G20, the various reform proposals need to be tied together and advanced.
Germany’s international partners have reacted very positively to the participation of the German Chancellor, as the only head of state and government of a developed country besides France’s President, in the “Summit for a New Financial Pact.” The reform agenda was also a topic at the Africa Climate Summit in Nairobi and the Finance in Common Summit in Cartagena this week. The task is to stay on it and quickly and comprehensively drive the initiated reforms forward. In the process, the Chancellor should also support innovative proposals from the Global South, such as the Bridgetown Initiative and the Expert Review on Debt, Nature and Climate.
The G20 can provide important impetus for the COP28 Global Stocktake to initiate a course correction in global climate action. The Chancellor should join calls for ambitious national reduction targets for 2030 and 2035 that are compatible with the 1.5-degree limit, a global milestone target of minus 60 percent by 2035, an investment and subsidy shift from fossil to renewable energy by 2025, and the transformation of food systems and land use.
In these times of global crises and geopolitical upheaval, Germany should make a solid international contribution out of its own self-interest. As Chancellor and Social Democrat, Olaf Scholz must, therefore, consistently campaign for an ambitious and equitable global climate transition at the G20 summit.
Steffen Menzel is Programme Lead for Climate Diplomacy and Geopolitics at think tank E3G.
