COP27: One year after the Glasgow Pact, the world is burning more fossil fuels than ever

The burning of fossil fuels has caused 86% of all CO₂ emissions over the past ten years. Despite being the main cause of global warming, coal, oil and gas have hardly been mentioned in the official texts of previous UN climate change summits.

Everything changed at COP26 in November 2021 when the Glasgow Climate Pact was signed. The agreement contained the first recognition of the role of fossil fuels in climate change. He also urged countries to phase out measures that subsidize the extraction or consumption of fossil fuels and “reduce” energy production from coal.

With COP27 in Sharm El Sheikh (Egypt), it’s time to update the progress. Unfortunately, the news is not very good. The current energy crisis and the short-term response of governments around the world have made it difficult to achieve the goals of the treaty to end the dominance of fossil fuels.

World energy crisis

The current situation is probably the first of its kind where the prices of all fossil fuels have skyrocketed at the same time. This, in turn, led to higher electricity prices.

Europe had to quickly adapt to Russia after its invasion of Ukraine, using its gas exports as a weapon. When the Kremlin cut pipeline gas supplies, European countries entered the global liquefied natural gas (LNG) market and increased imports from their traditional partners such as Norway and Algeria.

This has pushed natural gas prices to stratospheric levels and triggered a global gas race in which Europe surpasses developing countries in critical LNG supplies, plunging countries like Pakistan and Bangladesh into an even deeper crisis.

To keep the light on, some of these developing countries are turning to the most polluting fossil fuel: coal. The International Energy Agency (IEA) predicts that by 2022, global coal consumption will equal the all-time high of 2013.

In the EU, the demand for coal (mainly for the electricity sector) is expected to increase by 6.5%. If current demand trends continue, global coal consumption will be only 8.7% lower in 2030 than in 2021. To achieve zero emissions by 2050, coal consumption must be reduced by 32%.

The Organization of the Petroleum Exporting Countries (OPEC+) and its allies, most notably Russia, recently decided to cut oil production by 2 million barrels a day in an attempt to raise oil prices. While OPEC+ justifies its decision by saying that it expects a global recession that could lead to a repeat of the oil price collapses of 2008, 2014 and 2020, the EU and the US believe that this measure is not financial, but political.

To bring down high fossil fuel prices, governments around the world are turning to the very subsidies they agreed to eliminate. These subsidies reduce the cost of fuel for consumers, for example by fixing the price at a gas station.

After a notable decline in 2020, fossil fuel subsidies increased in 2021. And the current energy crisis has caused another sharp rise, according to the IEA’s 2022 estimate. Developing countries have been criticized in the past for using these tax tools, especially for subsidizing fossil fuel consumption. This criticism sounds especially pointless now that rich countries are rushing to do the same.

Fossil fuels at COP27

The US and European allies urged developing countries at COP26 to take bolder steps to phase out coal, promoting natural gas as a useful transitional fuel. Now Europe is limiting access to alternative sources by attracting developing countries in Asia and Latin America to the global LNG market, while also starting up its own idle coal-fired power plants or extending the life of existing ones.

Western leaders have also criticized China and India for buying Russian oil and gas, thereby financing Putin’s invasion. But since the start of the war, Russia has earned 108 billion euros just from selling fossil fuels to the EU, more than half of the country’s revenue from oil and gas exports.

Although gas pipeline flows from Russia to the EU have declined significantly, Russian LNG exports have increased. Low gas demand in China (due to the current covid-19 restrictions) is the lifeline that has allowed Europe to fill its tanks ahead of winter.

A year after the Glasgow Climate Pact, commitments and promises to reduce emissions have faded in the face of pressing challenges. A short-term race for gas and coal may make sense given the shock of the Russian invasion, but ideally fossil fuel prices will skyrocket to speed up the transition to renewables.

Simply shifting fossil fuel supplies from one exporter to another is bad for the climate and certainly doesn’t make energy supplies safer or more affordable. The world is facing not only an energy price crisis, but also a fossil fuel price crisis.

The IEA predicts that fossil fuel demand will peak in five years thanks to programs such as the EU’s RePowerEU plan, the US Inflation Reduction Act and Japan’s Green Transformation Plan that encourage the use of renewable energy sources. But despite these interventions, current emission trajectories predict 2.6ºC of warming by 2100, well in excess of the Paris Agreement’s targets.

Negotiations at COP27 must be conducted with the full understanding that fossil fuels will not cease to be part of the global energy mix. Developed countries must take the lead in addressing it in order to allow developing countries to adapt at a slower pace. This is the key to equitably phasing out climate-collapse fuels.

Mathieu Blondel, Research Fellow, Strategy and International Business Group, Warwick Business School, University of Warwick

This article was originally published on The Conversation. Read the original.