Don’t expect CoP-28 to make real progress against climate change

Ironically, CoP-28 is being held in the UAE, a member of OPEC and the world’s seventh largest producer of oil. Controversially, Sultan al-Jaber, the former head of Abu Dhabi National Oil Company (ADNOC), is the president of CoP-28. Leading up to the conference, al-Jaber has been busy making green deals in countries ranging from Turkey and Zambia to Egypt. The Financial Times reported that with the heft of the UAE’s sovereign wealth funds behind him, al-Jaber has announced green investment deals worth some $200 billion over the past year, with big agreements in Turkey and Azerbaijan. At the same time, ADNOC has a capital expenditure budget of $150 billion to further develop the UAE’s hydrocarbon capacity over the next five years.

Some green investments are real. For instance, the world’s largest solar installation at Bhadla Park in the Thar desert of Rajasthan. This 2,245-megawatt (MW) installation was financed with $775 million from the Climate Investment Fund and another $1.4 billion from development finance institutions. The multi-phase project is now fully operational and the operating units are performing satisfactorily. Many of the power purchase agreements (PPAs) to feed the grid that were initially delayed are now in place with the Solar Energy Corporation of India (SECI), a AAA-rated entity that is financially capable of honouring 25-year-long contracts.

Climate action typically involves slowly mitigating hydrocarbon emissions while also increasing the scale and breadth of ‘off-setting’ projects. This is the semantic origin of the term ‘net zero’ for emissions. Even as renewable energy schemes and electric vehicles gather steam around the world, the status of ‘off-setting’ projects is worrisome. Evidence from the Voluntary Carbon Credits Market (VCM) suggests that a majority of these off-setting projects that have sold carbon credits to help corporations and countries on their net- zero paths may actually be characterized as junk or worthless.

The most popular global off-setting projects include forestry schemes, hydro-electric dams, solar and wind farms, waste disposal and greener household appliances. For instance, the world’s largest carbon sequestration programme in Wyoming, US, which has benefitted from government subsidies, has either released its captured carbon dioxide or sold it to fossil fuel companies to assist in fracking, a technique used to extract oil and gas.

The UAE presidentship of CoP-28 is emblematic of the severe contradictions in the global response to climate change. On one hand, addiction to hydrocarbons remains strong; it may even be increasing. On the other hand, and at the same time, real green investments are increasing, even if not by enough. This split personality is captured in the flawed concept of net-zero targets. Hydrocarbon reduction (measured in terms of CO2 emission reduction) is a day too late (make that a couple of decades) and green investments are a dollar short (to the tune of $50-100 trillion actually).

While not fast enough, some progress has been made. US CO2 emissions peaked in 2007 at just under 7 gigatonnes of CO2 equivalent (GtCO2e) and are now running at about 5.5 GtCO2e. The EU now emits only 2.7 GtCO2e, down over 40% from its peak. The rest of the world, including China and India, still contribute to an annual growth of about 1% in emissions and are not anywhere close to their peaks.

The idea that countries can assuage their ‘guilt’ for emissions by offsetting these, so as to eventually emit only as much as they take out of the atmosphere, was the reason behind the powerful rise of the net zero concept. Think of it as a simple equation: E-O=NZ. Here, E stands for emissions, O for offsets that remove emissions and NZ (for net zero) is attained when E=O. If used properly, it can provide a directional framework for sustainability, while the world negotiates exactly how to take climate action while mitigating the potentially severe impacts of climate change. Alas, even as E increases, O is not only not keeping pace, but also terribly unreliable and subject to dramatic exaggeration (‘greenwashing’). While ambitious NZ targets have been announced, the performance of E and O are faltering and several years behind schedule, rendering the concept of NZ in its current form undeliverable at the existing pace of change.

To use a football metaphor, CoP-28 is likely to achieve a mid-field lateral pass of the ball that’s well short of goal. The net zero concept will likely live on with only modest progress on emissions reduction and offsets, well short of what is required for the long-term pledges of Paris to be met.

P.S: “The whole secret lies in confusing the enemy, so that he cannot fathom our real intent," said Sun Tzu in ‘The Art of War.’