Wary optimism for Cop deal to ‘set world in right direction’

December 13, 2023, 12:57 PM

Text’s first mention of fossil fuels
‘Strong signal’ to investors
Saudi Arabia praises outcome

Cop28 left behind an air of mixed emotions as it wrapped up on Wednesday, reflecting the complexity of the discussions and outcomes.

A visibly jubilant Sultan Al Jaber strolled into the plenary, sharing a warm hug with UN climate chief Simon Stiell, basking in the applause as they marked a “historic” milestone: the first time in 30 years that a climate summit decision text explicitly mentions fossil fuels.

The conference president told parties the global stocktake deal “confronted realities and set the world in the right direction” and “delivered a paradigm shift that has the potential to redefine economies”.

The mood was marked by wary optimism but also deep scepticism about vague language and “loopholes” in the text, including concerns about carbon capture, finance and the continued use of gas as a transition fuel.

The hard-fought agreement urged a transition away from coal, oil and gas this decade and was adopted in the fifth iteration of the global stocktake deal, after heated negotiations ran over the Tuesday deadline.

This language replaced the clear call for a “phase out” of fossil fuels, a central point of contention throughout the talks.

The text specifically calls for “transitioning away from fossil fuels in energy systems, in a just, orderly and equitable manner … so as to achieve net zero by 2050 in keeping with the science”.

This substitutes the previous reference to “reducing both consumption and production” of fossil fuels that was met with strong resistance from oil producers including Saudi Arabia, Iraq, Iran, Oman and China.

Sultan Al Jaber and Simon Stiell celebrated their milestone deal in Dubai

Not a win for oil producers

Catherine Abreu, founder and executive director at Destination Zero, said the deal did not count as a win for oil producers as it sends a “strong signal to investment markets” to stop pouring money into fossil fuels and to scale up money being invested in renewables.

Reuters reported the closing statement of a meeting of Arab energy ministers in Doha on Tuesday that said oil and gas will be “pillars of global energy for many decades to come”.

A Saudi representative at Cop28 told the plenary the kingdom welcomes the deal and praised the outcome.

Romain Ioualalen, global policy manager Oil Change International, said the oil industry, especially Opec, is in denial about “the scale of change happening right now” and needed to think long and hard about the long-term impact of the 200 or so countries agreeing to transition away from hydrocarbons.

Ioualalen added that it was “too easy to blame Saudi Arabia”, alluding to proxy wars in the negotiations.

He called out the US – which is still the largest producer and consumer of oil in the world and still the largest expander of fossil fuel production in the world, way ahead of Saudi Arabia.

“This agreement is a very loud signal that the diversification of its economy needs to start now and needs to be accelerated,” he said.

‘Massive clean energy revolution’

The final text includes a new specific target to treble renewables and double energy efficiency by 2030.

Bruce Douglas, CEO of Global Renewables Alliance, said this was “unprecedented and signals the start of a massive clean energy revolution”.

He said: “It is the first time all nations have recognised renewable energy as the main solution to the climate crisis, representing a paradigm shift in the energy transition.”

Despite this, Justin Alexander, a director at the consultancy Khalij Economics based in the US, said the demand for fossil fuels was not suddenly going to disappear as a result of the Cop28 deal.

“Even if the world does get its act together for an aggressive phase-out of fossil fuels there will still be demand for tens of millions of barrels a day for several decades to come,” he said.

Moving forward towards Cop29 in Baku, Linda Kalcher, executive director of Brussels-bassed consultancy Strategic Perspectives, said what was missing was clarity on how the transition away from hydrocarbons will be managed and policed.

“This deal is still heavy with loopholes, lacking timelines, and fails to provide the support that the majority of the world’s people are going to need to finance the rapid transition that is now required.”