India and Europe unite against fossil fuels + Global shield: details unclear + No country on path to 1.5-degrees
Surprising alliance: India and Europe unite against fossil fuels
Global shield: 210 million, details unclear
Study: No country on path to 1.5-degrees
Mexico and Chile with new NDCs – India and Argentina present strategies
New alliance: Brazil, DR Congo, Indonesia demand more money for rainforests
Outlook: EU, China and India faster than their NDCs?
China and USA: Return to dialogue
Forced labor: USA blocks Chinese solar imports
Fatih Birol – IEA chief drives energy transition forward
Dear reader,
When the cat’s away, the mice will play. This also happens at COP27 right now: The Egyptian presidency refrains from its duties that the countries themselves begin to organize themselves. An exciting and entirely new coalition is forming between coal country India, the EU, the UK and island nations to push back against coal, oil and gas. Is this genuine or just strategy? We will take a closer look.
Everyone is still waiting for the negotiating texts from the presidency. They want to know exactly about which details they will be arguing over the next few nights. Resentment over the negotiations is growing in the corridors. The renowned Climate Change Performance Index again tells us that all countries are not doing enough. And differentiates exactly how much not enough is.
And Brazil, DR Congo and Indonesia finally join forces to form a “Rainforest Opec” to jointly represent their interests. Germany organizes the “global shield” against climate damage, all outside the official negotiations. And the important ministers and delegates in Sharm el-Sheikh are waiting to see what their bosses decide at the G20 meeting in Bali anyway.
These are not the strong signals from the global community or the host that are always pledged at the start of COP. And it suggests that the workload and hectic pace will increase in the final days (and especially nights). But if things went on in an organized and orderly fashion, it would not be a COP.
Your Bernhard Pötter
Feature
Surprising alliance: India and Europe united against fossil fuels
India is the world’s second-largest coal consumer.
COP27 faces an explosive debate on the global energy transition. An Indian push for scaling back “all fossil fuels” in the final declaration found support on Monday from the EU, the UK and some island nations. Other countries, such as Saudi Arabia, already signaled not to agree to such a final declaration.
In the internal letter available to Climate.Table over the weekend, India proposed that the cover decision at the end of the conference should note “the IPCC AR6 report that has come since Glasgow that recognizes the need for phase down of all fossil fuels.” Distinguishing between different sources of emissions as harmful or “green and sustainable” has “no basis in the best available science.”
EU: Push fits the Green Deal
The proposal is part of the motions collected by the COP presidency for its cover decision. India’s chief negotiator Richa Sharma still wondered at noon: “Why isn’t there more enthusiasm for phasing down all fossil fuels?” A declaration on phasing down was found in Glasgow – “what about the other fuels that produce carbon?” asked Sharma. Now, he says, discussions are underway with the other parties on the issue.
That has apparently paid off. “The phase-out of all fossil fuels is in line with the European Green Deal,” Jan Dusík, environment minister of the Czech Republic, which currently holds the EU presidency, told Climate.Table this afternoon. “We are ready to work on appropriate wording in the text of the cover decision.”
“We have acknowledged India’s proposal,” Dusík continued. But he cautioned, “We don’t want it to be used as a tool to lead us away from our commitment under the Glasgow Climate Pact to phase out coal.”
Distrust: many opponents and strategic deliberation
There are several reasons for the distrust toward India’s push:
There is not yet a draft final declaration that specifically and in detail mentions this demand.
Unlike coal, there is a broad front of states that rely on oil and gas revenues.
The issue is on the agenda at the current G20 meeting in Bali and could be decided there.
Some states and observers see the Indian push as a diversion.
Even at the beginning of the second week, the presidency still hardly presented any texts that the nations could work with. In preparing the “cover decision,” the Egyptians had only collected votes by Monday evening and did not summarize them. With a few exceptions, the technical work on the documents was not completed as planned at the end of the first week. An overview by the climate specialist portal “Carbon Brief” shows how many unresolved issues remain in the documents. Some texts have over 240 unresolved questions.
The unfinished work was pushed to the second, crucial week – and now threatens to lead to a backlog that could block the conference, fears UNFCCC chief Simon Stiell: “There are too many unresolved issues,” says Stiell. The problem: When the ministers arrive in the next few days, only politically highly explosive issues should remain for them to resolve. Technical details will only get in the way.
Sharm el-Sheikh waits on Bali
If and how the issue of the energy transition is dealt with in Sharm el-Sheikh will probably be decided in Bali anyway. Climate policy will also be discussed at the G20 meeting. Unlike in Glasgow, when crucial issues had been resolved at the G20 summit before COP, COP27 is now awaiting results from the G20 – for example, the resumption of climate talks between the US and China (see today’s News).
“The Indian push is a smart diplomatic move,” commented Li Shuo, a climate expert with Greenpeace East Asia. “For China, this will be an interesting challenge.” Because on the one hand, China has no interest in pushing for a rapid fossil fuels phase-out of. After all, it consumes large amounts itself. It would prefer to prevent the issue from appearing in the cover decision, he said. On the other hand, China and India are close partners in the G77 and the BASIC group. The fact that China did not yet officially respond to the Indian proposal shows that “it doesn’t know what to say.”
Christoph Bals of Germanwatch is also generally open to India’s proposal. Less fossil fuel is the goal, says Bals. But he also warns that there is a large alliance against such a declaration: African countries that rely on gas, the oil states and, last but not least, the United States, the world’s largest oil and gas producer. “It could also be a tactical ruse by India to make any mention of fossils in the final declaration impossible over a big wave of opposition.”
In fact, a year ago in Glasgow, the coal country India had played a decisive role in preventing the cover decision from calling for the “phase-down” of coal. This brought India a lot of international criticism. With a successful campaign against all fossil fuels, the country could also aim to gather new allies such as the Europeans and vulnerable states and polish its battered reputation. with Nico Beckert and Lukas Scheid
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Global Shield: 210 million is just the beginning
German Development Minister Svenja Schulze in conversation with women in al Amaria. Rasha wears the flowered headscarf.
Since she received the money from the World Bank, she has a better standing in the community, says Rasha Shaaban Ahmed. Having an income of her own earns her respect. The 38-year-old mother of three is one of the women supported by the “Takaful” program – Arabic for solidarity – in al Amaria, a town near the Egyptian city of Alexandria.
With the 462 Egyptian pounds she receives each month, the equivalent of just over 18 euros, Rasha kept three chickens. She bought the chicks, raised them and sold them. Some chicken also improved the diet of her family, which consists of Rasha herself, her husband and their three children. Things were going well until chicken feed suddenly became unaffordable due to inflation. But at least Rasha still has the fixed monthly income.
210 million euros for the Global Shield
Social networks like “Takaful” could be used in the future to disburse funds from the “Global Shield against Climate Risks”. That is one of the ideas behind the shield jointly developed by the largest industrialized nations G7 and the Group of 58 Most Vulnerable States (V20). On Monday, they officially presented it at COP27.
Germany has already pledged 170 million euros to the Global Shield. Around 40 million euros will be contributed by other industrialized countries. All payments are grants. At COP27, it is rumored that other countries are considering participation. This could add another two- and three-digit million euro amount. However, any official announcements are not expected during the summit. For comparison: The German government provided 30 billion euros in aid alone for the floods in the Ahr Valley.
How the shield is supposed to work
Many details of the technical implementation of the umbrella are not yet clear. This may also be because it is supposed to offer a custom solution for each country that meets its specific needs, tailored to each country’s own requirements. The basic approach could look like this:
When the umbrella begins to work with a country, it begins with a climate risk assessment. Which climate risks particularly affect the country? What damages are likely, who would they affect, and how expensive would they be? What kind of support does the country need to deal with them?
The assessment is followed by the response plan, which is jointly drafted with the Global Umbrella’s partner organizations – multilateral development banks, organizations with civil society or technical expertise. The plan is designed to ensure that aid reaches those affected as quickly as possible in the event of a disaster. “Pre-arranged finance” is the keyword here.
Depending on the country, for example, cash payments could then flow through existing networks to people like Rasha from al Amaria. Elsewhere, insurance solutions might make more sense – or a combination of both. What is chosen depends very much on the situation in the country.
The shield is expected to be operational soon. “We cannot wait another two years,” said Sarah Ahmed, V20 finance expert. She held out the prospect that the umbrella could launch “in early 2023.”
Bangladesh, Ghana, Pakistan and others
Bangladesh, Costa Rica, Fiji, Ghana, Pakistan, the Philippines and Senegal are expected to be the first recipients under the Global Shield against Climate Risks. The shield “will play a key role in resourcing financial and social protection packages to protect our economy, our enterprises and our communities,” said Ghana’s Finance Minister Ken Ofori-Atta, whose country currently chairs the V20.
He expressed hope that the global shield would help build mutual trust and close financing gaps for climate protection. The issue of financing is one of the most controversial topics each year at the UN climate summits. Germany wanted to build bridges in the dispute over loss-and-damage money, said German Development Minister Svenja Schulze, who spoke for the G7 at the press conference on the launch of the global shield. She explicitly emphasized what the shield was not intended to be:
It was not a strategy to prevent negotiations on loss and damage under the UNFCCC agenda. “Germany has actively supported the inclusion of loss and damage on the agenda.”
Nor is it the only solution for loss-and-damage financing. “We need a broad range of solutions.”
‘When will there be the first payout to a victim?’
The response at COP27 was cautiously positive for the most part. The environment and development organization Germanwatch sees the shield as a “good start” in the loss-and-damage debate. But the sum it contains is “only a drop in the bucket.” Other organizations at COP27 fear a diversion.
“It’s good that the Global Shield goes further than the previous G7 InsuResilience initiative, which only included insurance solutions,” Saleemul Huq, a climate scientist from Bangladesh, told Climate.Table. “But the devil is always in the details.” He said he looks forward to learning more about how the shield will work. Huq asked, “When will there be the first payout to a victim?”
‘Not the solution anyone is asking for’
Bareesh Chowdhury, Asia-Pacific coordinator of Friends of the Earth International, was more critical. He called the Global Umbrella a “cynical scheme” used by Germany and other governments to distract from the “vital financial need” of vulnerable countries.
On Twitter, he differentiated: the Global Umbrella is “not the solution anyone is asking for. Already many G7 pledges for loss and damage finance are flowing to this, rather than a funding facility under the UNFCCC which is what G77+China countries have demanded.” Chowdhury, therefore, fears that the global shield could prevent an agreement on loss and damage under the UNFCCC. “The Shield in and of itself is not a bad thing. But if this is an excuse to resist real finance, we should call that out.”
First draft for loss-and-damage agreement
At least the issue of loss and damage response funding is part of the official negotiations in Sharm el-Sheikh. On Monday, a first draft of a possible agreement, although still very general, was already available. It includes three key points:
The paper considers creating a new loss and damage fund under the UNFCCC umbrella, a key demand of developing countries – though much can change till the end of the negotiations.
It acknowledges the significance of previous solutions, including those outside the UNFCCC – this includes the global shield.
And it sets up the prospect of two more years of negotiations over the details.
Flood risk in the Nile Delta
Al Amaria, the village where Rasha and her family live, is located in the Nile Delta not far inland. Here, the sea level rises by about one centimeter a year, if the lowering of the ground is factored in. As the water rises, so does the risk of floods. If floods occur, Rasha could benefit from additional financial aid through “Takaful”.
For now, however, she wants one thing above all: That the monthly payments do not stop, and that she can continue to enjoy the freedom to manage her own income.
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Climate Protection Index: no country on a path to 1.5-degrees
To keep the 1.5-degree target achievable, industrialized and emerging economies in particular must reduce their emissions. A new analysis by Germanwatch and the New Climate Institute shows that the 60 largest GHG emitters are not meeting this target and where countries still need to catch up.
China, as the largest emitter today, continues to show two faces. According to the Climate Protection Index 2023, presented on Monday at the COP27 in Sharm el-Sheikh, China only ranks 51st out of the 59 countries surveyed (+ EU). The index gives Beijing credit for massively expanding its renewable energies. Nevertheless, the country is not reducing its greenhouse gas emissions fast enough.
Compared to the previous year, Germany dropped three places to 16th. The reason for this is the slower expansion of renewables by 2020 and the sharp rise in emissions in the transport sector in 2021.
The index is based on objective criteria and expert surveys. A country’s greenhouse gas emissions (40 percent weighting), the amount of renewables (20 percent), energy efficiency (20 percent), and national and international climate policy (10 percent each) are included. Traditionally, the first three places in the index remain empty, as no country scores “very high” in all categories.
China ranks 17th in renewables alone, with a positive “high” rating, but investments in new coal-fired power plants and the further expansion of coal-fired power generation lower the average significantly. Compared to last year, China even dropped 13 places.
The USA also scores as badly as usual (rank 52). The main problem is that the USA has not stopped producing fossil fuels in its own country and continues to subsidize fossil fuels. When it comes to the expansion of renewables, the USA comes fifth from last.
Chile, Morocco and India top – Japan flop
India scores surprisingly well (rank eight, previously ten), even though the country is one of the largest coal producers. This is thanks to India’s low per-capita emissions and good energy efficiency. On the African continent, Morocco dominates the index (rank seven). The country is reported to be a pioneer in reducing its emissions and has stepped up these efforts after COP22. However, it is criticized for not enforcing existing laws and for its industry’s non-compliance.
In South America, Chile (sixth) takes the lead. The country’s good rating is due to its “relatively low per capita emissions of 2.24 metric tons of CO2 equivalents (including LULUCF).” For climate policy, Chile receives only a mediocre rating because it lacks adequate climate change mitigation and adaptation strategies for water scarcity.
G7 country Japan comes in at rank 50 because it does not yet have a clear roadmap for its already inadequate climate goals, according to the index’s authors. Japan has no coal phase-out planned, no effective carbon pricing, and no solid development plan for renewables, they say.
Europe’s climate policy in fourth
The countries examined are the 59 largest emitters; Ukraine was not examined this year due to the war. They include all 27 EU member states. As a bloc, the EU ranks in the upper midfield at 19 – three places higher than last year. Although the EU ranks among the top 4 in climate policy – 1st place (Denmark) and 3rd place (Netherlands) are also EU members. But because per capita emissions are still high (24th) and the expansion of renewables is stalling (26), the EU falls behind. In the overall result, Denmark and Sweden, like last year, are also two European countries in the top positions. luk
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Mexico and Chile present new NDCs – and India and Argentina their strategies
Chile and Mexico announced new climate targets (NDCs) at COP27. India presented a long-term strategy on how to meet the NDC and Argentina plans until 2030.
Mexico plans to cut greenhouse emissions by 35 percent
Mexico’s new climate target:
Reducing greenhouse gas (GHG) emissions by 35 percent by 2030 (down from 22 percent)
Private and public investment of 48 billion dollars
Expand renewable energy by 40 gigawatts (double the previous NDC)
Expansion of electric mobility
Expansion of nature reserves to two million square kilometers
Planting of 1.1 million trees
Mexico’s Foreign Minister Marcelo Ebrard presented these targets at COP on Saturday, but did not specify what GHG level or comparison year the new reduction target is based on. Mexico’s previous NDC assumed a baseline scenario by 2030 with no policies (991 MtCO2e) to reduce GHGs. Further details on how Mexico will achieve these targets are also not yet known.
Chile wants to protect ecosystems
Chile’s new climate target:
Expanding protected terrestrial and aquatic ecosystems by at least one million hectares by 2030
Provide all public protected areas with management plans that include climate change adaptation measures
Reversing the growing trend in national methane emissions by 2025
Strengthening the socio-ecological just transition.
These goals are to be achieved “by strengthening the implementation of measures at relevant points at the national level and by directing the work for the next update of the NDC,” according to the announcement by Chile’s Ministry of Environment. However, the ministry has not yet provided further details. However, it did state that Chile could reduce its greenhouse gas emissions (taking into account sink performance) by four percent in 2020 compared to 2018.
India presents long-term strategy
India presented its long-term strategy yesterday, outlining for the first time how it plans to achieve its decarbonization target by 2070. It includes:
In the energy sector, the expansion of nuclear power and the hydrogen sector is emphasized. The transition away from fossil fuels is to happen “just, smooth, sustainable and all inclusive.” Coal will continue to be needed to ensure grid stability and India’s energy security. The strategy does not include a timetable with numerical targets for the coal phase-out.
In the transportation sector, India wants to rely more on so-called bio-fuels and EVs.
The industrial sector is to use energy more efficiently and growth is to be decoupled from emissions.
Sustainable management of food systems and forests
Sustainable mobility
Sustainable and resilient territories
Energy transition
Productive transition
These six points are broken down into 250 measures and instruments. In its NDC, Argentina specifies that net emissions from all sectors of the economy must not exceed 349 million tCO2e by 2030. However, it is not clear from the plans how the country intends to achieve this target, which is why experts warn against excessive euphoria. nib/luk
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Brazil, DR Congo and Indonesia form rainforest alliance
The three countries with the world’s largest rainforest areas have formed an alliance for the protection of their tropical forests. Brazil, Indonesia and DR Congo have agreed on a strategic partnership to protect the rainforest.
The goal of the alliance is to,
encourage wealthy countries to step up funding for rainforest conservation. A joint statement said that if deforestation is to be reduced and forests preserved as carbon sinks, wealthy countries must provide more funding.
negotiate “a new sustainable funding mechanism” to help developing countries preserve their biodiversity
increase funding through the United Nations’ REDD+ program for reducing deforestation
The alliance was formally signed by representatives of the three countries on Monday in the run-up to the G20 summit in Bali. For Brazil, it was signed by a representative of the ousted Bolsonaro government, under which deforestation had increased sharply (Climate.Table reported). Incoming President Lula also has plans for a similar alliance. He takes office on January 1, 2023. The three countries are home to 52 percent of the world’s remaining primary tropical forests. The alliance is the result of about ten years of irregular talks on a trilateral rainforest alliance. nib/rtr
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EU, China and India could reach NDCs faster
A new analysis by the Energy and Climate Intelligence Unit (ECIU) expresses optimism that the four largest greenhouse gas emitters are making rapid progress on the energy transition. The EU countries, China and India could achieve their climate targets (NDCs) faster than planned, writes the British NGO. For this purpose, the analysts examined the implementation of climate policies, economic trends and expansion plans of companies.
More ambitious EU NDC expected
The European Union and its member states:
have set new climate and energy policy targets and measures to achieve them in the wake of Russia’s invasion of Ukraine.
These include efficiency improvements, expansion of renewables, electrification of the transport sector, new targets for heat and hydrogen.
“This could result in a more ambitious EU NDC in the near future (Climate.Table reported),” ECIU concluded.
China:
will add about 165 gigawatts of renewable energy capacity in 2022.
the expansion of coal-fired power plants is to be understood as crisis capacity (China.Table reported)
EV sales are expected to grow to six million units in 2022. Twice as much compared to the previous year.
However, China’s NDC is not Paris-compliant, and an acceleration in emissions reductions is needed (Climate.Table reported).
Analysts: India’s energy transition is accelerating
India:
The expansion of renewable energies, especially solar energy, accelerates sharply
Coal-fired power will quickly become an unprofitable backup for wind and solar power
Positive trends in the transportation and building sectors are expected to help India meet its 2070 net-zero target.
USA:
The US ranks second behind China in expanding wind and solar power, and 85 percent of electricity could come from renewable sources by 2030.
EVs could account for half of all new car sales by 2030.
President Joe Biden pushed through legislation that would provide 500 billion dollars for climate spending.
However, the US would still have “some way to go to hit the US NDC upper level of 52 percent.” According to the Climate Action Tracker, as much as a 63 percent reduction is needed to meet the Paris Agreement’s 1.5-degree target. nib
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China and the US make progress on climate dialogue
The meeting between US President Joe Biden and China’s leader Xi Jinping at the G20 summit raises hopes that the two countries could resume their frozen climate dialogue. After the three-hour meeting Monday on the Indonesian island of Bali, Biden stressed that both countries need to work together on major world issues such as climate change, economic stability, debt relief, health and food security, according to the White House. Both presidents had instructed their top officials to “deepen constructive efforts on these and other issues,” the statement continued.
But they have not yet decided to officially resume bilateral climate talks. The Chinese side rather hints at progress between the lines. The official news agency Xinhua reported that both sides wanted to:
Use joint US-China working groups to address specific issues.
Work together toward a successful conclusion of the COP27 climate conference.
and strengthen necessary cooperation on climate action and food security.
Biden and Xi: first step for international climate protection
The bilateral climate dialogue was put on hold by China after US House of Representatives Speaker Nancy Pelosis visited Taiwan. The dialogue dates back to the joint statement issued by the United States and China at the COP26 climate conference in Glasgow. At that time, the two sides agreed to strengthen climate action in the 2020s. Among other things, they had planned to negotiate measures to reduce methane emissions this year.
For all their non-commitment, the reports from Bali sparked cautious optimism among observers. “Both sides seem to have accepted that they should communicate through existing ‘working groups’, and one of them is about climate,” says Byford Tsang of climate think tank E3G. The two special climate envoys Xie Zhenhua and John Kerry had so far only exchanged informal views at COP27. It was initially unclear whether they would be allowed to meet officially in the final days of the COP27. ck
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United States block over 1,000 Chinese solar imports
More than 1,000 solar energy components imported from China are stuck at US ports. Customs officials told Reuters that US Customs seized 1,053 shipments between June 21 and Oct. 25. Clearances have not yet been issued, they said.
The reason for the blockade is the Uyghur Forced Labor Prevention Act (UFLPA), which went into effect in June. Importers must prove that goods or components of products from the Xinjiang region have not been produced using forced labor (China.Table reported).
According to the Reuters report, the products include panels and polysilicon cells, which would be manufactured primarily by three Chinese companies: Longi Green Energy Technology, Trina Solar and JinkoSolar. Jinko said in an email that the company is working with U.S. Customs to document that its shipments are not linked to forced labor. The company said it was “confident that the shipments will be approved.”
US Customs would not comment on how long the shipments have been on hold and when and if they would be cleared, according to Reuters. “Ultimately, it is contingent upon how quickly an importer is able to submit sufficient documentation,” a spokeswoman said.
The supply problems are also stalling US President Joe Biden’s climate policy. He intends to push the expansion of eco-friendly energy sources in the USA as quickly as possible.
The People’s Republic is the global market leader in the solar sector and dominates all production stages. Worldwide, three out of four solar modules and 83 percent of solar cells are manufactured in China. China dominates 77 percent of the world market for polysilicon. Xinjiang again plays a special role here. An estimated 50 percent of global polysilicon production comes from the western Chinese region. nib/rtr
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Heads
Fatih Birol – economist at the helm of the IEA
Fatih Birol drives the energy transition forward
Fatih Birol doesn’t beat around the bush. In his speech last week at COP27, the Head of the International Energy Agency (IEA) stressed that if all countries fully met their pledged climate targets, the global temperature increase could be limited to 1.7 degrees Celsius. That would meet the Paris Agreement target of well below 2 degrees. But that would not be enough. To reach the necessary 1.5-degree target, a lot more ambition and effort would be required. For example, in the energy transition, which is particularly important to Birol.
Birol therefore pursues a clear agenda at the helm of the IEA. The organization is to transform itself into a global network for the transition to clean energy. The Ukraine crisis “is a stark reminder of the unsustainability of the current energy system, which is dominated by fossil fuels. We have the chance to make this a historic turning point towards a cleaner, more affordable and more secure energy system,” Birol wrote in an op-ed for the Financial Times.
Birol makes IEA advocate for the energy transition
Birol cites the EU’s REPowerEU plan and the US with the new Inflation Reduction Act as positive examples of global efforts to achieve the energy transition. Both are to promote a wide range of clean energies. But Birol also points to Japan, which aims to restart and build more nuclear power plants and expand other key low-emission technologies with its GX green transformation plan. He also says there is good news from China in this regard. The country is expanding renewable energies at a rapid pace and has successfully introduced the electric drive revolution.
Birol also wants to modernize the organization, which was founded in 1974. The IEA is supposed to open up to emerging countries and large energy consumers such as China, India, Brazil and South Africa. Its 30 current members are almost exclusively industrialized countries. Economies with large populations, such as China, India and Brazil, only have associate status.
Birol lists three risk factors for energy supply in the next two years: the absence of Russian gas in Europe, China’s economic woes and strained LNG market conditions. “In the next few years, we have to be ready [to deal] with volatile and high energy prices,” Birol told Euronews. “And we have to find solutions.”
Birol warned early of gas crisis
Birol has a good nose for approaching crises. As early as January 2022, he warned that Russia was throttling gas supplies to Europe at a particularly sensitive time, both politically and economically. “We believe there are strong elements of tightness in the European gas market due to Russia’s behavior. I would note that today’s low Russian gas flows to Europe coincide with heightened geopolitical tensions over Ukraine,” Birol said. A short time later, Putin launched his assault on Ukraine. A global energy crisis ensued.
Birol said that the low gas stocks in Europe last winter were mainly caused by the Russian gas company Gazprom, which had supplied Europe with about 25 percent less gas than usual. So Birol’s accusation ten months ago was clear: Russia was responsible for orchestrating an energy crisis in Europe.
Soccer fan with long IEA career
The 64-year-old economist looks back on a long career at the IEA. He started out as an analyst in the mid-1990s, served as chief economist until 2015, and was then appointed head of the organization. He previously worked for six years in the Secretariat of the Organization of Petroleum Exporting Countries (OPEC) in Vienna. At the IEA, Birol is responsible for the globally respected World Energy Outlook report, which is published every November. In a 2018 interview with US broadcaster CNBC, Birol said that “energy is my life.” Aside from his love of his profession, his passion is soccer. Whenever his favorite team, Galatasaray Istanbul, wins, the Ankara-born IEA chief buys a round at the office.
Birol stresses that the current crisis is the first-ever global energy crisis. Unlike the oil crises of the 1970s, this time it is not just about oil. Russia was, until the invasion of Ukraine, “the No. 1 oil exporter of the world, No. 1 natural gas exporter of the world, and a major player in the coal markets.” Isabel Cuesta; Collaboration: Nico Beckert
Surprising alliance: India and Europe unite against fossil fuels
Global shield: 210 million, details unclear
Study: No country on path to 1.5-degrees
Mexico and Chile with new NDCs – India and Argentina present strategies
New alliance: Brazil, DR Congo, Indonesia demand more money for rainforests
Outlook: EU, China and India faster than their NDCs?
China and USA: Return to dialogue
Forced labor: USA blocks Chinese solar imports
Fatih Birol – IEA chief drives energy transition forward
Dear reader,
When the cat’s away, the mice will play. This also happens at COP27 right now: The Egyptian presidency refrains from its duties that the countries themselves begin to organize themselves. An exciting and entirely new coalition is forming between coal country India, the EU, the UK and island nations to push back against coal, oil and gas. Is this genuine or just strategy? We will take a closer look.
Everyone is still waiting for the negotiating texts from the presidency. They want to know exactly about which details they will be arguing over the next few nights. Resentment over the negotiations is growing in the corridors. The renowned Climate Change Performance Index again tells us that all countries are not doing enough. And differentiates exactly how much not enough is.
And Brazil, DR Congo and Indonesia finally join forces to form a “Rainforest Opec” to jointly represent their interests. Germany organizes the “global shield” against climate damage, all outside the official negotiations. And the important ministers and delegates in Sharm el-Sheikh are waiting to see what their bosses decide at the G20 meeting in Bali anyway.
These are not the strong signals from the global community or the host that are always pledged at the start of COP. And it suggests that the workload and hectic pace will increase in the final days (and especially nights). But if things went on in an organized and orderly fashion, it would not be a COP.
Your Bernhard Pötter
Feature
Surprising alliance: India and Europe united against fossil fuels
India is the world’s second-largest coal consumer.
COP27 faces an explosive debate on the global energy transition. An Indian push for scaling back “all fossil fuels” in the final declaration found support on Monday from the EU, the UK and some island nations. Other countries, such as Saudi Arabia, already signaled not to agree to such a final declaration.
In the internal letter available to Climate.Table over the weekend, India proposed that the cover decision at the end of the conference should note “the IPCC AR6 report that has come since Glasgow that recognizes the need for phase down of all fossil fuels.” Distinguishing between different sources of emissions as harmful or “green and sustainable” has “no basis in the best available science.”
EU: Push fits the Green Deal
The proposal is part of the motions collected by the COP presidency for its cover decision. India’s chief negotiator Richa Sharma still wondered at noon: “Why isn’t there more enthusiasm for phasing down all fossil fuels?” A declaration on phasing down was found in Glasgow – “what about the other fuels that produce carbon?” asked Sharma. Now, he says, discussions are underway with the other parties on the issue.
That has apparently paid off. “The phase-out of all fossil fuels is in line with the European Green Deal,” Jan Dusík, environment minister of the Czech Republic, which currently holds the EU presidency, told Climate.Table this afternoon. “We are ready to work on appropriate wording in the text of the cover decision.”
“We have acknowledged India’s proposal,” Dusík continued. But he cautioned, “We don’t want it to be used as a tool to lead us away from our commitment under the Glasgow Climate Pact to phase out coal.”
Distrust: many opponents and strategic deliberation
There are several reasons for the distrust toward India’s push:
There is not yet a draft final declaration that specifically and in detail mentions this demand.
Unlike coal, there is a broad front of states that rely on oil and gas revenues.
The issue is on the agenda at the current G20 meeting in Bali and could be decided there.
Some states and observers see the Indian push as a diversion.
Even at the beginning of the second week, the presidency still hardly presented any texts that the nations could work with. In preparing the “cover decision,” the Egyptians had only collected votes by Monday evening and did not summarize them. With a few exceptions, the technical work on the documents was not completed as planned at the end of the first week. An overview by the climate specialist portal “Carbon Brief” shows how many unresolved issues remain in the documents. Some texts have over 240 unresolved questions.
The unfinished work was pushed to the second, crucial week – and now threatens to lead to a backlog that could block the conference, fears UNFCCC chief Simon Stiell: “There are too many unresolved issues,” says Stiell. The problem: When the ministers arrive in the next few days, only politically highly explosive issues should remain for them to resolve. Technical details will only get in the way.
Sharm el-Sheikh waits on Bali
If and how the issue of the energy transition is dealt with in Sharm el-Sheikh will probably be decided in Bali anyway. Climate policy will also be discussed at the G20 meeting. Unlike in Glasgow, when crucial issues had been resolved at the G20 summit before COP, COP27 is now awaiting results from the G20 – for example, the resumption of climate talks between the US and China (see today’s News).
“The Indian push is a smart diplomatic move,” commented Li Shuo, a climate expert with Greenpeace East Asia. “For China, this will be an interesting challenge.” Because on the one hand, China has no interest in pushing for a rapid fossil fuels phase-out of. After all, it consumes large amounts itself. It would prefer to prevent the issue from appearing in the cover decision, he said. On the other hand, China and India are close partners in the G77 and the BASIC group. The fact that China did not yet officially respond to the Indian proposal shows that “it doesn’t know what to say.”
Christoph Bals of Germanwatch is also generally open to India’s proposal. Less fossil fuel is the goal, says Bals. But he also warns that there is a large alliance against such a declaration: African countries that rely on gas, the oil states and, last but not least, the United States, the world’s largest oil and gas producer. “It could also be a tactical ruse by India to make any mention of fossils in the final declaration impossible over a big wave of opposition.”
In fact, a year ago in Glasgow, the coal country India had played a decisive role in preventing the cover decision from calling for the “phase-down” of coal. This brought India a lot of international criticism. With a successful campaign against all fossil fuels, the country could also aim to gather new allies such as the Europeans and vulnerable states and polish its battered reputation. with Nico Beckert and Lukas Scheid
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Global Shield: 210 million is just the beginning
German Development Minister Svenja Schulze in conversation with women in al Amaria. Rasha wears the flowered headscarf.
Since she received the money from the World Bank, she has a better standing in the community, says Rasha Shaaban Ahmed. Having an income of her own earns her respect. The 38-year-old mother of three is one of the women supported by the “Takaful” program – Arabic for solidarity – in al Amaria, a town near the Egyptian city of Alexandria.
With the 462 Egyptian pounds she receives each month, the equivalent of just over 18 euros, Rasha kept three chickens. She bought the chicks, raised them and sold them. Some chicken also improved the diet of her family, which consists of Rasha herself, her husband and their three children. Things were going well until chicken feed suddenly became unaffordable due to inflation. But at least Rasha still has the fixed monthly income.
210 million euros for the Global Shield
Social networks like “Takaful” could be used in the future to disburse funds from the “Global Shield against Climate Risks”. That is one of the ideas behind the shield jointly developed by the largest industrialized nations G7 and the Group of 58 Most Vulnerable States (V20). On Monday, they officially presented it at COP27.
Germany has already pledged 170 million euros to the Global Shield. Around 40 million euros will be contributed by other industrialized countries. All payments are grants. At COP27, it is rumored that other countries are considering participation. This could add another two- and three-digit million euro amount. However, any official announcements are not expected during the summit. For comparison: The German government provided 30 billion euros in aid alone for the floods in the Ahr Valley.
How the shield is supposed to work
Many details of the technical implementation of the umbrella are not yet clear. This may also be because it is supposed to offer a custom solution for each country that meets its specific needs, tailored to each country’s own requirements. The basic approach could look like this:
When the umbrella begins to work with a country, it begins with a climate risk assessment. Which climate risks particularly affect the country? What damages are likely, who would they affect, and how expensive would they be? What kind of support does the country need to deal with them?
The assessment is followed by the response plan, which is jointly drafted with the Global Umbrella’s partner organizations – multilateral development banks, organizations with civil society or technical expertise. The plan is designed to ensure that aid reaches those affected as quickly as possible in the event of a disaster. “Pre-arranged finance” is the keyword here.
Depending on the country, for example, cash payments could then flow through existing networks to people like Rasha from al Amaria. Elsewhere, insurance solutions might make more sense – or a combination of both. What is chosen depends very much on the situation in the country.
The shield is expected to be operational soon. “We cannot wait another two years,” said Sarah Ahmed, V20 finance expert. She held out the prospect that the umbrella could launch “in early 2023.”
Bangladesh, Ghana, Pakistan and others
Bangladesh, Costa Rica, Fiji, Ghana, Pakistan, the Philippines and Senegal are expected to be the first recipients under the Global Shield against Climate Risks. The shield “will play a key role in resourcing financial and social protection packages to protect our economy, our enterprises and our communities,” said Ghana’s Finance Minister Ken Ofori-Atta, whose country currently chairs the V20.
He expressed hope that the global shield would help build mutual trust and close financing gaps for climate protection. The issue of financing is one of the most controversial topics each year at the UN climate summits. Germany wanted to build bridges in the dispute over loss-and-damage money, said German Development Minister Svenja Schulze, who spoke for the G7 at the press conference on the launch of the global shield. She explicitly emphasized what the shield was not intended to be:
It was not a strategy to prevent negotiations on loss and damage under the UNFCCC agenda. “Germany has actively supported the inclusion of loss and damage on the agenda.”
Nor is it the only solution for loss-and-damage financing. “We need a broad range of solutions.”
‘When will there be the first payout to a victim?’
The response at COP27 was cautiously positive for the most part. The environment and development organization Germanwatch sees the shield as a “good start” in the loss-and-damage debate. But the sum it contains is “only a drop in the bucket.” Other organizations at COP27 fear a diversion.
“It’s good that the Global Shield goes further than the previous G7 InsuResilience initiative, which only included insurance solutions,” Saleemul Huq, a climate scientist from Bangladesh, told Climate.Table. “But the devil is always in the details.” He said he looks forward to learning more about how the shield will work. Huq asked, “When will there be the first payout to a victim?”
‘Not the solution anyone is asking for’
Bareesh Chowdhury, Asia-Pacific coordinator of Friends of the Earth International, was more critical. He called the Global Umbrella a “cynical scheme” used by Germany and other governments to distract from the “vital financial need” of vulnerable countries.
On Twitter, he differentiated: the Global Umbrella is “not the solution anyone is asking for. Already many G7 pledges for loss and damage finance are flowing to this, rather than a funding facility under the UNFCCC which is what G77+China countries have demanded.” Chowdhury, therefore, fears that the global shield could prevent an agreement on loss and damage under the UNFCCC. “The Shield in and of itself is not a bad thing. But if this is an excuse to resist real finance, we should call that out.”
First draft for loss-and-damage agreement
At least the issue of loss and damage response funding is part of the official negotiations in Sharm el-Sheikh. On Monday, a first draft of a possible agreement, although still very general, was already available. It includes three key points:
The paper considers creating a new loss and damage fund under the UNFCCC umbrella, a key demand of developing countries – though much can change till the end of the negotiations.
It acknowledges the significance of previous solutions, including those outside the UNFCCC – this includes the global shield.
And it sets up the prospect of two more years of negotiations over the details.
Flood risk in the Nile Delta
Al Amaria, the village where Rasha and her family live, is located in the Nile Delta not far inland. Here, the sea level rises by about one centimeter a year, if the lowering of the ground is factored in. As the water rises, so does the risk of floods. If floods occur, Rasha could benefit from additional financial aid through “Takaful”.
For now, however, she wants one thing above all: That the monthly payments do not stop, and that she can continue to enjoy the freedom to manage her own income.
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Climate Protection Index: no country on a path to 1.5-degrees
To keep the 1.5-degree target achievable, industrialized and emerging economies in particular must reduce their emissions. A new analysis by Germanwatch and the New Climate Institute shows that the 60 largest GHG emitters are not meeting this target and where countries still need to catch up.
China, as the largest emitter today, continues to show two faces. According to the Climate Protection Index 2023, presented on Monday at the COP27 in Sharm el-Sheikh, China only ranks 51st out of the 59 countries surveyed (+ EU). The index gives Beijing credit for massively expanding its renewable energies. Nevertheless, the country is not reducing its greenhouse gas emissions fast enough.
Compared to the previous year, Germany dropped three places to 16th. The reason for this is the slower expansion of renewables by 2020 and the sharp rise in emissions in the transport sector in 2021.
The index is based on objective criteria and expert surveys. A country’s greenhouse gas emissions (40 percent weighting), the amount of renewables (20 percent), energy efficiency (20 percent), and national and international climate policy (10 percent each) are included. Traditionally, the first three places in the index remain empty, as no country scores “very high” in all categories.
China ranks 17th in renewables alone, with a positive “high” rating, but investments in new coal-fired power plants and the further expansion of coal-fired power generation lower the average significantly. Compared to last year, China even dropped 13 places.
The USA also scores as badly as usual (rank 52). The main problem is that the USA has not stopped producing fossil fuels in its own country and continues to subsidize fossil fuels. When it comes to the expansion of renewables, the USA comes fifth from last.
Chile, Morocco and India top – Japan flop
India scores surprisingly well (rank eight, previously ten), even though the country is one of the largest coal producers. This is thanks to India’s low per-capita emissions and good energy efficiency. On the African continent, Morocco dominates the index (rank seven). The country is reported to be a pioneer in reducing its emissions and has stepped up these efforts after COP22. However, it is criticized for not enforcing existing laws and for its industry’s non-compliance.
In South America, Chile (sixth) takes the lead. The country’s good rating is due to its “relatively low per capita emissions of 2.24 metric tons of CO2 equivalents (including LULUCF).” For climate policy, Chile receives only a mediocre rating because it lacks adequate climate change mitigation and adaptation strategies for water scarcity.
G7 country Japan comes in at rank 50 because it does not yet have a clear roadmap for its already inadequate climate goals, according to the index’s authors. Japan has no coal phase-out planned, no effective carbon pricing, and no solid development plan for renewables, they say.
Europe’s climate policy in fourth
The countries examined are the 59 largest emitters; Ukraine was not examined this year due to the war. They include all 27 EU member states. As a bloc, the EU ranks in the upper midfield at 19 – three places higher than last year. Although the EU ranks among the top 4 in climate policy – 1st place (Denmark) and 3rd place (Netherlands) are also EU members. But because per capita emissions are still high (24th) and the expansion of renewables is stalling (26), the EU falls behind. In the overall result, Denmark and Sweden, like last year, are also two European countries in the top positions. luk
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Mexico and Chile present new NDCs – and India and Argentina their strategies
Chile and Mexico announced new climate targets (NDCs) at COP27. India presented a long-term strategy on how to meet the NDC and Argentina plans until 2030.
Mexico plans to cut greenhouse emissions by 35 percent
Mexico’s new climate target:
Reducing greenhouse gas (GHG) emissions by 35 percent by 2030 (down from 22 percent)
Private and public investment of 48 billion dollars
Expand renewable energy by 40 gigawatts (double the previous NDC)
Expansion of electric mobility
Expansion of nature reserves to two million square kilometers
Planting of 1.1 million trees
Mexico’s Foreign Minister Marcelo Ebrard presented these targets at COP on Saturday, but did not specify what GHG level or comparison year the new reduction target is based on. Mexico’s previous NDC assumed a baseline scenario by 2030 with no policies (991 MtCO2e) to reduce GHGs. Further details on how Mexico will achieve these targets are also not yet known.
Chile wants to protect ecosystems
Chile’s new climate target:
Expanding protected terrestrial and aquatic ecosystems by at least one million hectares by 2030
Provide all public protected areas with management plans that include climate change adaptation measures
Reversing the growing trend in national methane emissions by 2025
Strengthening the socio-ecological just transition.
These goals are to be achieved “by strengthening the implementation of measures at relevant points at the national level and by directing the work for the next update of the NDC,” according to the announcement by Chile’s Ministry of Environment. However, the ministry has not yet provided further details. However, it did state that Chile could reduce its greenhouse gas emissions (taking into account sink performance) by four percent in 2020 compared to 2018.
India presents long-term strategy
India presented its long-term strategy yesterday, outlining for the first time how it plans to achieve its decarbonization target by 2070. It includes:
In the energy sector, the expansion of nuclear power and the hydrogen sector is emphasized. The transition away from fossil fuels is to happen “just, smooth, sustainable and all inclusive.” Coal will continue to be needed to ensure grid stability and India’s energy security. The strategy does not include a timetable with numerical targets for the coal phase-out.
In the transportation sector, India wants to rely more on so-called bio-fuels and EVs.
The industrial sector is to use energy more efficiently and growth is to be decoupled from emissions.
Sustainable management of food systems and forests
Sustainable mobility
Sustainable and resilient territories
Energy transition
Productive transition
These six points are broken down into 250 measures and instruments. In its NDC, Argentina specifies that net emissions from all sectors of the economy must not exceed 349 million tCO2e by 2030. However, it is not clear from the plans how the country intends to achieve this target, which is why experts warn against excessive euphoria. nib/luk
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India
Mexico
Brazil, DR Congo and Indonesia form rainforest alliance
The three countries with the world’s largest rainforest areas have formed an alliance for the protection of their tropical forests. Brazil, Indonesia and DR Congo have agreed on a strategic partnership to protect the rainforest.
The goal of the alliance is to,
encourage wealthy countries to step up funding for rainforest conservation. A joint statement said that if deforestation is to be reduced and forests preserved as carbon sinks, wealthy countries must provide more funding.
negotiate “a new sustainable funding mechanism” to help developing countries preserve their biodiversity
increase funding through the United Nations’ REDD+ program for reducing deforestation
The alliance was formally signed by representatives of the three countries on Monday in the run-up to the G20 summit in Bali. For Brazil, it was signed by a representative of the ousted Bolsonaro government, under which deforestation had increased sharply (Climate.Table reported). Incoming President Lula also has plans for a similar alliance. He takes office on January 1, 2023. The three countries are home to 52 percent of the world’s remaining primary tropical forests. The alliance is the result of about ten years of irregular talks on a trilateral rainforest alliance. nib/rtr
Brazil
DR Congo
Indonesia
Rainforest
EU, China and India could reach NDCs faster
A new analysis by the Energy and Climate Intelligence Unit (ECIU) expresses optimism that the four largest greenhouse gas emitters are making rapid progress on the energy transition. The EU countries, China and India could achieve their climate targets (NDCs) faster than planned, writes the British NGO. For this purpose, the analysts examined the implementation of climate policies, economic trends and expansion plans of companies.
More ambitious EU NDC expected
The European Union and its member states:
have set new climate and energy policy targets and measures to achieve them in the wake of Russia’s invasion of Ukraine.
These include efficiency improvements, expansion of renewables, electrification of the transport sector, new targets for heat and hydrogen.
“This could result in a more ambitious EU NDC in the near future (Climate.Table reported),” ECIU concluded.
China:
will add about 165 gigawatts of renewable energy capacity in 2022.
the expansion of coal-fired power plants is to be understood as crisis capacity (China.Table reported)
EV sales are expected to grow to six million units in 2022. Twice as much compared to the previous year.
However, China’s NDC is not Paris-compliant, and an acceleration in emissions reductions is needed (Climate.Table reported).
Analysts: India’s energy transition is accelerating
India:
The expansion of renewable energies, especially solar energy, accelerates sharply
Coal-fired power will quickly become an unprofitable backup for wind and solar power
Positive trends in the transportation and building sectors are expected to help India meet its 2070 net-zero target.
USA:
The US ranks second behind China in expanding wind and solar power, and 85 percent of electricity could come from renewable sources by 2030.
EVs could account for half of all new car sales by 2030.
President Joe Biden pushed through legislation that would provide 500 billion dollars for climate spending.
However, the US would still have “some way to go to hit the US NDC upper level of 52 percent.” According to the Climate Action Tracker, as much as a 63 percent reduction is needed to meet the Paris Agreement’s 1.5-degree target. nib
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China and the US make progress on climate dialogue
The meeting between US President Joe Biden and China’s leader Xi Jinping at the G20 summit raises hopes that the two countries could resume their frozen climate dialogue. After the three-hour meeting Monday on the Indonesian island of Bali, Biden stressed that both countries need to work together on major world issues such as climate change, economic stability, debt relief, health and food security, according to the White House. Both presidents had instructed their top officials to “deepen constructive efforts on these and other issues,” the statement continued.
But they have not yet decided to officially resume bilateral climate talks. The Chinese side rather hints at progress between the lines. The official news agency Xinhua reported that both sides wanted to:
Use joint US-China working groups to address specific issues.
Work together toward a successful conclusion of the COP27 climate conference.
and strengthen necessary cooperation on climate action and food security.
Biden and Xi: first step for international climate protection
The bilateral climate dialogue was put on hold by China after US House of Representatives Speaker Nancy Pelosis visited Taiwan. The dialogue dates back to the joint statement issued by the United States and China at the COP26 climate conference in Glasgow. At that time, the two sides agreed to strengthen climate action in the 2020s. Among other things, they had planned to negotiate measures to reduce methane emissions this year.
For all their non-commitment, the reports from Bali sparked cautious optimism among observers. “Both sides seem to have accepted that they should communicate through existing ‘working groups’, and one of them is about climate,” says Byford Tsang of climate think tank E3G. The two special climate envoys Xie Zhenhua and John Kerry had so far only exchanged informal views at COP27. It was initially unclear whether they would be allowed to meet officially in the final days of the COP27. ck
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United States block over 1,000 Chinese solar imports
More than 1,000 solar energy components imported from China are stuck at US ports. Customs officials told Reuters that US Customs seized 1,053 shipments between June 21 and Oct. 25. Clearances have not yet been issued, they said.
The reason for the blockade is the Uyghur Forced Labor Prevention Act (UFLPA), which went into effect in June. Importers must prove that goods or components of products from the Xinjiang region have not been produced using forced labor (China.Table reported).
According to the Reuters report, the products include panels and polysilicon cells, which would be manufactured primarily by three Chinese companies: Longi Green Energy Technology, Trina Solar and JinkoSolar. Jinko said in an email that the company is working with U.S. Customs to document that its shipments are not linked to forced labor. The company said it was “confident that the shipments will be approved.”
US Customs would not comment on how long the shipments have been on hold and when and if they would be cleared, according to Reuters. “Ultimately, it is contingent upon how quickly an importer is able to submit sufficient documentation,” a spokeswoman said.
The supply problems are also stalling US President Joe Biden’s climate policy. He intends to push the expansion of eco-friendly energy sources in the USA as quickly as possible.
The People’s Republic is the global market leader in the solar sector and dominates all production stages. Worldwide, three out of four solar modules and 83 percent of solar cells are manufactured in China. China dominates 77 percent of the world market for polysilicon. Xinjiang again plays a special role here. An estimated 50 percent of global polysilicon production comes from the western Chinese region. nib/rtr
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Heads
Fatih Birol – economist at the helm of the IEA
Fatih Birol drives the energy transition forward
Fatih Birol doesn’t beat around the bush. In his speech last week at COP27, the Head of the International Energy Agency (IEA) stressed that if all countries fully met their pledged climate targets, the global temperature increase could be limited to 1.7 degrees Celsius. That would meet the Paris Agreement target of well below 2 degrees. But that would not be enough. To reach the necessary 1.5-degree target, a lot more ambition and effort would be required. For example, in the energy transition, which is particularly important to Birol.
Birol therefore pursues a clear agenda at the helm of the IEA. The organization is to transform itself into a global network for the transition to clean energy. The Ukraine crisis “is a stark reminder of the unsustainability of the current energy system, which is dominated by fossil fuels. We have the chance to make this a historic turning point towards a cleaner, more affordable and more secure energy system,” Birol wrote in an op-ed for the Financial Times.
Birol makes IEA advocate for the energy transition
Birol cites the EU’s REPowerEU plan and the US with the new Inflation Reduction Act as positive examples of global efforts to achieve the energy transition. Both are to promote a wide range of clean energies. But Birol also points to Japan, which aims to restart and build more nuclear power plants and expand other key low-emission technologies with its GX green transformation plan. He also says there is good news from China in this regard. The country is expanding renewable energies at a rapid pace and has successfully introduced the electric drive revolution.
Birol also wants to modernize the organization, which was founded in 1974. The IEA is supposed to open up to emerging countries and large energy consumers such as China, India, Brazil and South Africa. Its 30 current members are almost exclusively industrialized countries. Economies with large populations, such as China, India and Brazil, only have associate status.
Birol lists three risk factors for energy supply in the next two years: the absence of Russian gas in Europe, China’s economic woes and strained LNG market conditions. “In the next few years, we have to be ready [to deal] with volatile and high energy prices,” Birol told Euronews. “And we have to find solutions.”
Birol warned early of gas crisis
Birol has a good nose for approaching crises. As early as January 2022, he warned that Russia was throttling gas supplies to Europe at a particularly sensitive time, both politically and economically. “We believe there are strong elements of tightness in the European gas market due to Russia’s behavior. I would note that today’s low Russian gas flows to Europe coincide with heightened geopolitical tensions over Ukraine,” Birol said. A short time later, Putin launched his assault on Ukraine. A global energy crisis ensued.
Birol said that the low gas stocks in Europe last winter were mainly caused by the Russian gas company Gazprom, which had supplied Europe with about 25 percent less gas than usual. So Birol’s accusation ten months ago was clear: Russia was responsible for orchestrating an energy crisis in Europe.
Soccer fan with long IEA career
The 64-year-old economist looks back on a long career at the IEA. He started out as an analyst in the mid-1990s, served as chief economist until 2015, and was then appointed head of the organization. He previously worked for six years in the Secretariat of the Organization of Petroleum Exporting Countries (OPEC) in Vienna. At the IEA, Birol is responsible for the globally respected World Energy Outlook report, which is published every November. In a 2018 interview with US broadcaster CNBC, Birol said that “energy is my life.” Aside from his love of his profession, his passion is soccer. Whenever his favorite team, Galatasaray Istanbul, wins, the Ankara-born IEA chief buys a round at the office.
Birol stresses that the current crisis is the first-ever global energy crisis. Unlike the oil crises of the 1970s, this time it is not just about oil. Russia was, until the invasion of Ukraine, “the No. 1 oil exporter of the world, No. 1 natural gas exporter of the world, and a major player in the coal markets.” Isabel Cuesta; Collaboration: Nico Beckert
