The next big international climate meeting kicks off in less than a month, with pressure on host city Dubai and the United Arab Emirates to produce results. This time oil companies and other energy providers are expected to have more of a presence and more input.
In theory, the climate gathering could hold some real surprises, for the industry and the future of the global energy transition.
Here’s what to look for.
COP28, the 28th Conference of the Parties to the U.N. Framework Convention on Climate Change, will convene in the UAE beginning Nov. 30.
“I’m prepared for a surprise. Having lived and worked in Dubai for so long, I can’t imagine Dubai having so much of the world’s spotlight without making a splash,” said Jim Krane.
Krane is a fellow for energy studies at Rice University’s Baker Institute for Public Policy in Houston, specializing in energy geopolitics. He said he lived and reported from Dubai and the UAE for four and a half years.
“That part of the world is where a third of the world’s oil comes from, the Persian Gulf countries, and a large part of the world’s (climate) emissions,” he noted.
Middle East hydrocarbon producers tend to rank high on any list of countries with the world’s highest per-capita CO2 emissions. Qatar, Kuwait, the UAE, Saudi Arabia and Oman typically land near the top.
Mostly, that reflects a combination of hydrocarbon production and active, industrialized economies with relatively small populations. But the Persian Gulf countries have struggled with their level of climate emissions.
The region is also considered to be one of the world’s most at-risk from the effects of climate change, especially heat and sea-level rise. Dubai itself has been identified as a place where summer temperatures could briefly reach uninhabitable levels by the end of this century.
Speculation about outcomes at COP28 include the possibility of major financial commitments from Persian Gulf oil producers to help fund green energy development in emerging economies. Although, there’s no agreement on what big twist might emerge from the meeting.
“I don’t know what it will be,” Krane said.
The president-designate for COP28 is Sultan Ahmed al-Jaber, the CEO of Abu Dhabi National Oil Co. Climate activists have questioned whether an oil executive should lead the U.N. climate meeting.
In May, more than 100 members of the U.S. Congress and the European parliament wrote to the U.N. urging that al-Jaber be replaced.
“The conventional wisdom is that this has the potential to be a very contentious meeting, especially given that it’s in a leading oil-producing country,” said Mark Finley, also a Baker Institute energy fellow.
“A lot of climate activists are worried that will have a negative effect. But the reality is, fossil fuels account for 80 percent of the world’s energy mix,” he noted.
Part of the Problem or Part of the Solution?
Before joining the institute, Finley was senior U.S. economist at BP, and prior to that an analyst and manager at the Central Intelligence Agency. He thinks the climate summit will be more effective with energy producers involved, and said, “that voice will be in the room” this time.
The region’s hydrocarbon producing countries are still more involved with reacting to climate action than dealing with climate change, Krane commented.
“I’m not sure what their strategies are, but I know from a regime-protection perspective, these countries are extremely concerned about climate actions,” he noted.
“I think they really feel threatened by the current way decarbonization is proceeding,” Krane said.
That could lead COP28 discussions more toward climate emissions reduction and capture, rather than energy-transition proposals. COP28 organizers have already acknowledged the increased importance of energy security as an issue.
“Places that make a living from oil would like to go another direction: Instead of demonizing fossil fuels, let’s demonize emissions,” Krane observed.
Taking Stock of Emissions
After a round of pre-session gatherings, COP28 formally begins with opening ceremonies on Nov. 30. It then goes into a two-day World Climate Action Summit Dec. 1-2. That event is described as a convocation of government and business leaders and “an important platform for major announcements.”
Plans for the summit reportedly include a Global Decarbonization Alliance agreement aimed at CEOs and other corporate leaders, with a goal of net-zero scope 1 and 2 emissions by 2050. Those include direct emissions and emissions from purchased energy.
With regard to executives at oil and gas companies, “at a global level, a number of these companies are increasing their investment in renewable energy,” Finley noted.
“These companies are already making commitments. The question is, how aggressive will they be?” he said.
The conference then moves into several days of considering climate effects and potential climate actions in specific areas, including health, finance, industry and urban areas. COP28 also will include a “global stock-take” measuring progress countries have made on their emissions-reduction commitments.
Reports from that assessment could be grim. Finley noted the world’s lack of progress in reducing emissions and enforcing meaningful commitments since the first COP took place in Berlin in 1995 – “and those (existing) commitments are not a net-zero pathway,” he added.
“Since 1995, global CO2 emissions … have grown by over 50 percent – 56 percent, to be precise,” he observed.
“Since the first COP, emissions in China and India have more than tripled,” he added.
War, Sanctions, Subsidies
The run-up to COP28 has taken place against a backdrop of renewed hostilities in the Middle East. That’s already diverted attention away from the climate discussions, especially as governments in the region focus on the Israel-Hamas-Palestine conflict.
“The folks on the Arab side of the Persian Gulf are really worried that a link to Iran will be found, and cause Israel – or Israel and the United States – to retaliate against Iran,” Krane said.
Sanctions and other actions against Iran usually have a spillover effect on other energy producers in the Middle East, he noted. Tensions could even escalate to the point of a broader armed conflict, he said.
Or, “it could just be the Biden administration reluctantly reinvigorating those (earlier) sanctions,” Krane added.
COP meetings typically conclude with a flurry of positioning and negotiations among national-interest blocs. A recurring sticking point has been a demand by developing nations for more financial support from the world’s wealthier economies.
“Another issue is, who’s going to pay for this? That’s an increasingly thorny and contentious issue in the COP process,” Finley observed.
“The World Bank has said, ‘We’re not going to lend to poorer countries to build coal-fired plants,’ for instance, or to develop hydrocarbon resources,” he said.
Developed countries have committed to providing and mobilizing $100 billion in climate financing per year, and analysts expect that goal to be reached for the first time in 2023.
COP28 concludes with final negotiations Dec. 11-12. The wrap-up normally includes a summary communique and statements from the meeting chair and the U.N. Finley said the best way to evaluate a COP meeting is probably to “look at the final communique and see what’s in it.”
“For climate action to succeed, you need to have big oil producers on board. They’ve got the microphone. What are they going to do with it?” Krane commented.
Finley put it more bluntly:
“The challenge here is to get moving,” he said.