Highlight of COP27 was ‘Loss and Damage Fund’


Saturday, 10 December 2022 | Jaideep Mukherjee/ Vaishali Mishra/ Gaurav Bhatiani

Increasing climate risk around the globe requires a more strategic and broader approach to incorporate optimisation of consumption

The 27th edition of the United Nations Climate Change Conference or Conference of the Parties, COP27, concluded recently at Sharm El-Sheikh and made positive but limited progress. The Egyptian COP27 Presidency has defined the summit’s four key goals.

With mitigation, all parties, especially those in a position to “lead by example”, are urged to take “bold and immediate actions” and to reduce emissions to limit global warming well below 2°C. With adaptation, parties have to ensure that COP27 makes the “crucially needed progress” towards enhancing climate change resilience and assisting the world’s most vulnerable communities.

The goal of finance called for making significant progress on climate finance, including the delivery of the promised $100 billion per year to assist developing countries. With collaboration, the UN negotiations stuck to the consensus-based approach, as reaching an agreement will require “inclusive and active participation from all stakeholders”.

Increasing climate risk requires a more strategic and broader approach to incorporate optimisation of consumption. Doing more with less, adopting circular economy principles and removing incentives for inefficient equipment, business models and lifestyles need to be at the forefront and centre of the conversation.

Inspiration needs to be drawn from the words of Mahatma Gandhi that “the world has enough for everyone’s needs, but not everyone’s greed”. This applies not only to energy, but also conserving water, building materials, transportation, food and textiles. Definitive progress was made on the long-standing carbon market process, but many operational decisions were postponed for future negotiations.

Further, the negotiations remained confined to a relatively narrow agenda on fossil fuels and therefore missed the opportunity to comprehensively address all sources of GHGs.

While COP26 focused on mitigation, the highlight of COP27 was creation of the ‘Loss and Damage Fund’ to support most vulnerable countries impacted severely by climate disasters. Countries in Asia (India, Bangladesh, Vietnam, and Philippines), Africa (Kenya, Malawi, Chad, Niger), Pacific Islands (Fiji, Tuvalu, Kiribati) and Caribbean Islands (Haiti) are amongst the most vulnerable and impacted.

An area of particular attention is the inadequacy of current climate financing models. Global climate finance remains below the third of annual requirements. At COP27, negotiators deliberated on setting a ‘new collective quantified goal on climate finance’ in 2024, taking into account the needs and priorities of developing countries.

With millions of people in developing nations lacking access to reliable energy and depending on fossil fuels for their energy requirements adds to the carbon emission.

Energy access will power the socio-economic aspirations of 2.8 billion people without electricity. For an equitable and inclusive green transition, a scaled-up and integrated approach is required to support the clean energy transition to distributed renewable energy and grid-based renewables and will reduce dependence on fossil fuels.

Distributed renewable energy is relevant even for cities since they consume 60-80 per cent of energy and generate 70-75 per cent of GHG emissions. Hence, enabling energy transition will require significant effort in reforming urban planning and infrastructure delivery. Technology convergence across electricity, telecom, and transport present newer opportunities for reducing carbon footprints, improving quality of life, reducing cost, and enhancing long-term sustainability. Underground utility systems, which are gaining global popularity, can be integrated with the master plans. Such an approach will require new regulations and institutional structuring to include energy as a part of urban planning. Thus, a strategic approach to urbanization presents a large opportunity, given a strong positive correlation between per capita income and urbanisation.

Last year, the Conference of Parties 26 (COP26) in Glasgow reiterated the global community’s ongoing response to the Paris Agreement to tackle the climate crisis while declaring a state of global emergency. The goal to achieve net-zero global emissions by 2050 while keeping the increase in global average temperature below 1.5 degrees Celsius in comparison to pre-industrial levels was well-intentioned.

COP 27 balanced that with progress on adaptation and the creation of a loss and damage fund. Barbados Climate Envoy called the fund “a small victory for humankind”. However, the overall ambition and, more importantly, action on all fronts need to be significantly and urgently scaled to achieve more significant victories in mitigating the global emergency.

(Jaideep and Vaishali work with Smart Power-India) and Gaurav is with RTI International (India).