The United Nations Climate Change Conference COP27 closed today with a breakthrough agreement to provide “loss and damage” funding for vulnerable countries hit hard by climate disasters.

COP27 closes with no action on fossil fuels

Image credit: United Nations Climate Change/ Kiara Worth

Global leaders pledged to create a “loss and damage fund” to help poorer nations tackle climate change, but were unable to reach an agreement to phase out fossil fuels.

The COP27 UN climate summit in Egypt closed with a historic deal, in which negotiators from nearly 200 countries agreed to set up a “loss and damage” fund meant to help vulnerable countries cope with climate disasters and agreed the globe needs to cut greenhouse gas emissions nearly in half by 2030.

The pledge would end almost 30 years of waiting by nations facing huge climate impacts, despite their much smaller contributions to global warming. 

However, many have considered the conference a missed opportunity, as it failed to set a strategy for the phasing out of fossil fuels, allowing emissions-causing hydrocarbons to remain embedded in the global economy.

“We joined with many parties to propose a number of measures that would have contributed to this emissions-peaking before 2025, as the science tells us is necessary. Not in this text,” said Alok Sharma, president of the previous COP summit in Glasgow.

This year's talks in Sharm el-Sheikh, Egypt, came close to collapse, and overran by two days, as some oil-producing nations were accused of "stonewalling" a key proposal to phase out all fossil fuels that had the support of 80 nations. 

The final agreement has maintained the global goal of limiting warming to 1.5ºC, but did not go beyond it, despite the Egyptian presidency's push for the inclusion of a looser goal of 2ºC.

The text does not expand on last year’s call to phase out global use of “unabated coal” to include oil and natural gas -  something countries such as India had requested - and even featured a veiled reference to the benefits of natural gas as low-emission energy. 

“Clear follow-through on the phasedown of coal. Not in this text. A clear commitment to phase out all fossil fuels. Not in this text. And the energy text weakened in the final minutes,” Sharma added, as he warned that the 1.5°C ambition is “on life support”. 

The lack of a clear path to curb carbon emissions has disappointed many campaigners and polititians, including the European Union’s climate chief Frans Timmermans and Germany’s foreign minister Annalena Baerbock. 

“What we have in front of us is not enough of a step forward for people and planet,” Timmermans told his fellow negotiators. “We should have done much more.”

Baerbock added in a statement: “It is more than frustrating to see overdue steps on mitigation and the phase-out of fossil energies being stonewalled by a number of large emitters and oil producers."

UK prime minister Rishi Sunak, who attended the global climate summit earlier this month after initially deciding not to attend, said in a brief statement: “I welcome the progress made at COP27, but there can be no time for complacency.

“Keeping the 1.5° commitment alive is vital to the future of our planet. More must be done.”

The summit began two weeks ago with powerful statements from vulnerable nations, including the Tuvalu foreign minister's announcement that the island nation plans to recreate itself in the metaverse before it disappears beneath the ocean, and the Bahamian prime minister's clams that they "will not give up" in the fight against climate change. 

"The alternative consigns us to a watery grave," Bahamas’ prime minister Philip Davis said.

However, as days passed, nations and groups including the UK, EU and New Zealand grew increasingly unhappy with the lack of compromises on an overall temperature goal; on emissions cuts, and on the desire to target all fossil fuels for phasedown.

New Zealand's climate minister told BBC News that there were "strong attempts by the petrol states to roll back" on agreements, but that developed countries "held the line" in spite of a dramatic threat of an EU walkout. 

“The world will not thank us when they hear only excuses tomorrow,” the EU’s Timmermans said. “This is the make-or-break decade, but what we have in front of us is not enough of a step forward.”

Katie White, executive director of advocacy and campaigns at WWF, said: “While a deal on loss and damage finance is a positive step, it risks becoming a down payment on disaster unless emissions are urgently cut in line with the 1.5°C goal.”

If the world continues with current levels of emissions, there is a 50 per cent chance that global temperature rises will hit 1.5°C – the threshold imposed by the Paris Climate Agreement – in only nine years, according to a warning from Global Carbon project scientists ahead of the COP27 summit. 

Given the report’s findings, scientists have warned that emissions would have to fall at rates comparable to 2020 every year to keep temperature rises to 1.5°C in the long term. 

Last month, the Lancet Countdown, an annual report tracking climate change and the impact it has on global human health, said that climate change is exacerbating food insecurity; health impacts from extreme heat; the risk of infectious disease outbreaks, and life-threatening extreme weather events.

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