Last week, Egypt hosted the regular COP27 conference, an annual meeting of countries that have ratified the 1992 UN Framework Convention on Climate Change. It traditionally discusses climate change mitigation and greenhouse gas reduction strategies, as well as financial support for poorer countries in the energy transition. The most successful was the 2015 Paris COP21, where an agreement was signed that set a goal to keep the global average temperature rise “well below” 2 degrees and “make efforts” to limit the temperature increase to 1.5 degrees.
From year to year, two fundamental conflicts of interest manifest themselves at the forum, hindering the adoption of an effective action plan to combat climate change, remind experts of the Re-Russia online publication.
The first reflects the difference in the positions of rich and poorer, developing countries. Developed countries during the Industrial Revolution burned large amounts of fossil fuels, primarily coal, which caused a critical amount of greenhouse gases to accumulate in the atmosphere. Developing countries consider it unfair to be required to give up cheap traditional energy sources that can provide them with rapid GDP growth, and insist on offsetting the costs of switching to clean energy sources. The second conflict is related to the economic rivalry between the US and China, which are the two largest economies in the world and are responsible for 45% of all CO2 emissions into the atmosphere.
This competition does not allow either side to take on additional obligations for fear that this will create a competitive advantage for the other.
A very important outcome of COP27 is the agreement reached on the creation of a compensation fund for poor countries (the US and the EU this year agreed to include a discussion of this issue in the conference agenda). However, skeptics believe that it is too early to talk about a breakthrough. In Egypt, only a working group has been established so far to prepare proposals for COP28 to create a compensation fund. However, many open questions remain regarding its structure and operating principles.
Reaching a framework agreement to set up a fund is seen as particularly important because otherwise the forum showed an intensification of controversy regarding the issue of the speed of transition and the corresponding obligations of countries and governments.
The global energy crisis and the redistribution of energy markets resulting from the Russian special operation in Ukraine have presented many countries with new challenges. As a result, there was no talk at the forum about new commitments; on the contrary, many delegations doubted the feasibility of those already taken. The energy crisis provoked by the NWO forced many countries, including developed ones, to increase coal consumption. For example, according to the American Institute for Strategy and Policy (The New Lines Institute for Strategy and Policy) in the EU from February to November 2022, the use of coal for electricity generation increased by 8%.
Thus, the crisis associated with the loss of a significant part of Russian gas supplies has strengthened the position of fossil fuel producers. The lack of gas in the world market will be felt for several years, and representatives of the oil and gas sector had a compelling case at COP27 in favor of increased investment in fossil fuels. It is the over-optimism about the transition to new energy and the resulting lack of investment in upstream investment that has given the current energy crisis such scope and urgency, say energy skeptics. The pledge by the US and 19 other developed countries to stop developing fossil fuels in developing countries at the last COP26 was premature.
Unlike the International Energy Agency (IEA), which released an overly optimistic report in October that suggested that the energy crisis would accelerate the energy transition, COP27 was dominated by pessimists. For this reason, language calling for a phase-out of fossil fuels was removed from the final document. Instead, a paragraph was added that calls for the accelerated development of energy systems with low greenhouse gas emissions. A commentary to the forum published in the journal Nature argues that this revision of the final document will allow oil and gas companies to increase production of natural gas, considered the cleanest of all fossil fuels. Germany during the conference signed a new contract with Egypt for the supply of LNG. Other governments and international companies have explored projects in Senegal, Tanzania and Algeria.
As a result, COP27 was extremely skeptical in the world press. The Guardian estimates that the oil lobby's delegation to the meeting in Egypt was the largest at 636, up 25% from the previous year. ABBC News quoted Green Party German Foreign Secretary Annalena Burbock as accusing the coalition of Saudi Arabia, China, Iraq, Iran and Russia of sabotaging the fight against global warming.
For Russia, which ranks fourth in the world in terms of CO2 emissions and third in terms of oil supplies, the scenario of slowing down the energy transition and the call for the development of low-carbon energy sources look quite positive, even despite the loss of European premium fuel markets. However, whether the energy transition will be faster, according to the IEA, or slower, it will in any case become a period of coexistence of old and new types of energy. At the same time, Russia's position in the markets of traditional energy products has been significantly undermined by the conflict with Ukraine, and sanctions will prevent it from occupying those niches in new markets in which it has a competitive advantage and with which it could mitigate the consequences of the energy transition for its economy.