Keystone COP 28
The purpose of the United Nations is to transfer wealth from North to South and from West to East. - (author unknown)
The UNFCCC is the international environmental treaty, signed by 154 nations in 1992 at the “Earth Summit” in Rio de Janeiro, designed to combat "dangerous human interference with the climate system". It birthed the world’s first global agreement (the 1997 Kyoto Protocol) to reduce emissions of “greenhouse gases” (“GHG’s”; principally CO2 and methane) and its successor, the 2015 Paris Agreement. This Thursday, the UNFCCC will convene its annual conference on climate change in Dubai.
Under the Paris Agreement, the leaders of ~200 nations pledged to reduce GHG emissions to a level projected to keep earth’s average surface temperature increase to well below 2 degrees Celsius by the year 2100 versus the pre-industrial era. Each nation pledges their emissions reductions in the form of Nationally Determined Contributions (NDCs).
It is at the UNFCCC’s annual circus event, known as the “Conference of the Parties” (COP), where delegations from around the world go to watch advanced nations prostrate themselves to Sacrifice Humanity on the Green Altar of reducing CO2 emissions, regardless of the actual consequences to people or earth’s climate system.
In tow are a literal circus of environmental non-profits, glue-yourself-to-the-street-and-buildings activists, celebrities and, of course, fast-fading former teen climate icon, Greta Thunberg. Think of it as a climate-themed mashup of the old Keystone Cops silent films (with delegates endlessly bungling catching the climate thief) and Barnum and Bailey’s “Greatest Show on Earth” circus.
What are the key objectives for COP28? What are the likely points of contention? And twenty-eight years into this process, where do we stand compared to the UN’s “business as usual” (read: Armageddon) scenario? Let’s cut through the hype, hyperbole and pablum and put this COP under the interrogation lamp.
A pall was cast over COP28 back in January when the UNFCCC announced the United Arab Emirates as the host country, and the UAE appointed Sultan Al Jaber, the CEO of its Abu Dhabi National Oil Company, as President-designate of the event. A petrostate hosting, and the CEO of a state oil company as President of, the world’s most important climate conference sent environmentalists into a tizzy for obvious and legitimate reasons. Notably, U.S. Climate Envoy John Kerry, who helped broker an eleventh-hour deal to nix the terms “phase out coal” at COP26 (2021 in Glasgow), supported Al Jaber’s appointment.
“Environmentalist” outrage at the venue and President-designate culminated in a May letter to President Biden, EU President von der Leyen, the UN Secretary General, and the UNFCCC signed by 130 EcoStatist members of U.S. Congress and European Parliament urging them to “to engage in diplomatic efforts to secure the withdrawal of the President-designate of COP28”. Their plea was a scream in an empty forest. Al Jaber will lead the event starting Thursday.
The main thrusts at COP28 will be:
the first global “stocktake” - measuring progress toward the initial round of emissions reduction pledges (through 2030) in the Paris Agreement,
rapidly increasing “alternative” energy deployment,
finance for/payments to developing nations
A push for an agreement to “phase out” coal, oil, and natural gas can also be expected.
Global Emissions Stocktake
The central theme of the Paris Agreement is to encourage reduction in GHGs – principally CO2 from combustion of coal, oil, and natural gas – among the world’s 195 signatories. The aggregated reduction from the nation’s NDCs is the basis of targeted GHG reductions during the first commitment period running through 2030.
The Paris Agreement requires a “global stocktake” be performed every five years after 2018, the effective date of the initial NDCs. COP 28 will be the first such effort.
The first mid-term report card on signatories’ progress under the Paris Agreement is not intended to call out individual nations falling behind their commitments, but instead to gauge overall progress toward the aggregate reduction goals. A September UNFCCC report on the upcoming global stocktake makes it clear that despite the Agreement’s ambitions, the world is not on track to achieve the requisite emissions reductions in the necessary time frames, noting (emphasis added):
“collective progress on mitigation remains inadequate to date towards the fulfilment of the provisions of the Paris Agreement to hold the increase in the global average temperature to well below 2 °C above pre-industrial levels and pursue efforts to limit the temperature increase to 1.5 °C above pre-industrial levels.”
A figure included in the report helps visualize the difference between the present NDCs and the additional emissions reductions necessary to achieve the Paris Agreement’s 2-degree Celsius (and aspirational 1.5 degrees Celsius) goal. More pain is needed:
Despite the shrieks of disaster sure to emanate from Dubai starting later this week, context matters. Since you are not likely to get that context in the legacy media blitzkrieg over the next two weeks, environMENTAL will gladly provide it.
As the graph below shows, despite 27 years of COP meetings, the Kyoto Protocol and the Paris Agreement, global consumption of oil, coal and natural gas have all grown substantially since 1995, the year of COP1 in Berlin.
The growth in hydrocarbon energy consumption, and directly related CO2 emissions, has not occurred evenly, however. The chart below shows oil, coal, and natural gas consumption since COP1 in 1995 among the world’s 6 largest current GHG emitters. It is easy to see where the world needs to focus if it desires to reign in future emissions – China and India. Prior to 2050 neither will oblige as their priority is lifting billions of their citizens out of poverty.
As an additional reference point, as we noted in The Population Bombing, the doomsday emissions scenario leading to 7 degrees Celsius increase in earth’s average surface temperature - known casually as “business as usual” and technically as RCP8.5 – has faded so far from reality that its trajectory and emissions level at 2100 now appears only as a reference. As the UNFCCC figure above shows, even the existing NDCs keep the world on a CO2 emissions trajectory below 60 Gigatons (Gt) by the year 2100. RCP8.5 (and its successor SSP5-8.5) absurdly projects that level at 130 – 140 Gt by 2100 (in part based on faulty population assumptions dating to the early UNIPCC reports).
More Rapid Alternative Energy Deployment
Expect delegations at COP28 to call for more rapid and intense additional scaling of wind, solar and other “alternative energy” technologies to displace electricity generation from coal and natural gas and displace oil via electric vehicles. This would, naturally, require advanced nations to massively increase subsidies to these sources.
A 2022 study in the journal Energy & Environmental Science authored by Stanford civil engineer (and climate scientist to the stars) Mark Jacobson and colleagues put the cost of achieving net zero emissions in 145 countries globally by 2050 using wind, solar, hydropower and battery storage at $61.5 TRILLION, an amount roughly equal to the present value of all goods and services produced in the world’s top 6 economies. We have seen figures for the cost of reaching net zero out to the end of the century using wind, solar, hydropower and battery storage approach $100 trillion.
With record U.S. budget deficits and a $1 trillion interest expense on its sovereign debt, and after Europe spent nearly €1 trillion in energy support for citizens and industry since Russia’s invasion of Ukraine, it is not obvious to us where the West will find an additional $1 trillion - $2 trillion annually to expand wind and solar energy even more rapidly.
As one example, Germany recently attempted an end-run, off balance sheet solution: the government tried to redirect unallocated funds from its pandemic response to fill the budget gaps needed to advance the country’s energy transition. A German constitutional court stopped it, ruling the decision to move the €60BN into the Energy and Climate Fund, later renamed the Climate and Transformation Fund (KTF), was unconstitutional and void. This creates a major gap in Germany’s budget and especially its ability to fund its energy transformation (“Energiewende”).
Finance For/Payments to Developing Nations
At COP 15 in Copenhagen, advanced nations pledged a collective goal of $100 billion in annual finance to help the developing world reduce emissions and adapt to the impacts of climate change. Funding from advanced nations has consistently fallen short of the commitments, and the gap may be growing.
At COP27 in Sharm-el-Sheikh last year, 198 countries in the UNFCCC agreed to establish a “Loss and Damage Fund” (LDF) in 2024. The purpose of the LDF is to compensate developing nations for damages suffered by catastrophic weather events and sea level rise on the basis they are caused or exacerbated by the advanced nations with the largest historical CO2 emissions.
Negotiations in Abu Dabi at a pre-conference on the new LDF concluded three weeks ago were described as “tense”. Further below we detail some of the contentious issues on which the sides differ greatly.
Push to “Phase Out” Fossil Fuels
At COP26 in Glasgow a commitment to “phase out” coal in the final conference communique was a showstopper for developing nations, including China, India, and others. When delegates from China and India and the U.S. (led by John Kerry) emerged from an eleventh hour back-room negotiation, “phase out” had been watered down to “phase down”. COP26 President Alok Sharma fought back tears apologizing to attendees for the last-minute gutting of one of global environmentalists’ key ambitions.
Nonetheless, we expect certain government leaders, climate activists, and others to push again for a commitment to “phase out” not just coal but all forms of hydrocarbon energy by some date of their choosing in the near future. They will be encouraged by recent International Energy Agency reports suggesting a global peak in oil demand by 2030, despite the fact The Statistical Review of World Energy, the US EIA and others all predict oil consumption will peak well after 2030, and then decline at a slower pace than IEA’s projections.
From our perspective, three issues are likely to be serious points of contention and could threaten to derail COP28 and further progress toward the goals of the Paris Agreement.
First, the push for more rapid and widespread scaling of wind and solar, as well as retirement of coal-fired power plants, is smacking up against practical reality. Recent cancellation of offshore wind projects in the U.S., the UK government’s recent increases in the price for wind via its Contracts for Difference as well as solar subsidies, the German government’s loan guarantee bailout of Siemens Energy all show that “alternative energy” faces real-world economic constraints and physical limits, regardless of taxpayer largesse and central planning.
Sovereign debt levels, dramatically higher electricity rates and compromised grid reliability in places that have mandated rapid transitions to wind and solar, high fuel costs, energy-driven inflation and the highest interest rates in more than 40 years will temper ambitions of more rapid transition to wind and solar in most places. Practically speaking, this will also limit any attempt push further emissions reductions toward the more ambitious “1.5 degree” Paris ambition.
The second rub relates to the LDF. The Paris Agreement threaded a needle between the interests of the advanced nations who historically emitted the most GHGs and developing countries. The advanced nations feared endless liability claims by developing countries for bad weather and island nations for rising sea levels. The parties to the Paris Agreement noted that advanced nation’s historical emissions are “not a basis for liability or compensation”. The LDF is, effectively, the developing world’s answer to compensation without litigation.
The LDF concept is fraught with all sorts of problems, not the least of which is separating naturally occurring weather damage (and sea level rise) from that caused by historical (or current) CO2 emissions from legal activity. At COP27, China supported the creation of the LDF but refused to contribute under the auspices that it is a developing country not responsible for historical emissions (despite being the world’s largest current emitter of GHGs). The U.S. delegation was initially against the LDF but changed its position in the final deliberations last year.
The EU, Japan and others are signaling their willingness to give tens of billions to the LDF. The U.S. has a hard slog to get there in the present political and economic environment. The developing nations want the LDF contributions to be mandatory. The U.S., while supporting the concept, wants LDF commitments to be voluntary.
There are differences over who should hold and administer LDF contributions. The developing countries want the UN to be the arbiter (it’s one country-one vote system favors them). The U.S. would prefer the World Bank, arguing it has the requisite expertise and resources. The developing countries see the World Bank as unduly influenced by the U.S., and the U.S. sees it as more trustworthy than the UN.
All these examples merely scratch the surface before delving into who receives how much, for what damage events, under what circumstances from the LDF. For example, does China get to hold out its hand every time it suffers a flood because it is still listed under the Paris Agreement as a “developing” country, despite being the world’s largest emitter?
Finally, a contingent of regressive progressive environmental “leaders” will push for language in the event’s final COP 28 communique calling for a “phase out” of fossil fuels. They will not succeed, and language calling for a “phase down” even if it could be achieved would be pragmatically meaningless.
COP28 President Sultan Al Jaber’s language signals that the Middle Eastern countries will push for language instead calling for reducing or eliminating “unabated” CO2 emissions. These countries, along with the U.S., will push for technologies like carbon capture and sequestration (CCS) that would enable continued exploitation of oil, coal, and natural gas during the “energy transition”. (Our post last month about CCS was titled The Master Abaters.)
CCS, “direct air capture” or any other technology that allows the continued production and use of hydrocarbons is seen by environmentalists as a get out of jail free card to allow the evil fossil fuel industry to continue to operate. That proposition sets environmentalist’s hair on fire with rage. We predict with high confidence that sparks will fly, activists will cry, and glued hands will have to be pried from things at COP28 over this specific controversy. Or, worse (must see video, link in source note):
Just like their objection to CO2 emissions-free nuclear power, “environmentalists” rejection of CCS exposes their neo-Malthusian core. That ideology was expressed by Stanford biologist and author of the 1968 book The Population Bomb Paul Ehrlich. In 1975, Ehrlich said “giving society cheap abundant energy at this point would be the equivalent of giving an idiot child a machine gun.”
The U.S. is in an especially awkward position regarding demands to “phase out” fossil fuels. U.S. Climate Envoy John Kerry and contingent arrive at COP 28 just as the U.S. broke its all-time record for fossil fuel production – 13.2 million barrels per day (bpd), exceeding the previous record of 13.1 million bpd in March 2020, the week before Covid-19(84) broke the world.
Despite record U.S. oil production, according to the U.S.’ April 2021 Paris Agreement NDC update filed with the UNFCC by the Biden administration (emphasis added):
“Based on preliminary estimates, the United States is expected to have met and surpassed its 2020 target of net economy-wide emissions reductions in the range of 17 percent below 2005 levels and is broadly on track to achieve 26-28 percent emissions reductions below 2005 levels in 2025.”
The U.S. owes most of its CO2 emissions reductions to fracking. Germany’s Energiewende resulted in the “climate leader” burning more lignite (dirtiest form of thermal coal).
We close by noting that a largely forgotten element of the Paris Agreement is that it is a non-binding, voluntary agreement. From the outset, it was positioned as something less than a legally binding treaty precisely because it had no chance to be ratified by the U.S. Senate. The U.S. has already pulled out once, and not without precedent. In 2011, Canada became the first signatory to exit the Kyoto Protocol.
Substack author Robert Bryce has coined the phrase The Iron Law of Electricity. Simply put, people will do whatever they have to get and maintain electricity.
If the events of the last two years proved anything, it is that when faced with the choice of darkness and death (physical and economic), citizens and even their most idiotic “leaders” will ultimately choose electricity, heat and living standards over climate policies.
Economic conditions in the advanced nations, evaporation of the myth that “renewables” are the “cheapest” form of energy, and the reality that developing nations are going to use fossil fuels to lift 4+ billion people from poverty all weigh against the ideal outcome for COP28’s hopeful participants. If so, expect some long faces.
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The scary part is just how small the penetration of renewables are and yet how badly all economies implementing them are faring.
Success would be catastrophic
Great article to read before getting the day started. In the movie It's a Wonderful Life, Jimmy Stewart's daughter says, "every time an bell rings an angel gets his wings." I have a similar motto, "every time political leaders gather to discuss hydrocarbon reduction I buy a few more shares of XOM."