Macro Trends

Complicated COP Reflects Deeper Energy Divides

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  • Complaints from Western critics opposed to the United Arab Emirates’ (UAE) hosting of the upcoming COP28 climate talks are growing louder.
  • The pushback, which does not sit well with the UAE, is infusing layers of fresh tension into the complex and often divisive COP process.
  • The tensions are part of a much bigger struggle for control of the energy agenda, overlaid by complex geopolitics from an increasingly multipolar world and intensified by the Ukraine crisis.

The Issue

Technical preparations for November’s COP28 climate summit got under way in Bonn, Germany, this week. In parallel, controversy continues to simmer over the appointment of Abu Dhabi National Oil Co. (Adnoc) CEO Sultan al-Jaber as head of the talks. The UAE — which is looking to broker a historic agreement focused on “pragmatic” steps, mainly ramping up key technology investments — is bristling at the backlash. But the frictions are part of a bigger struggle for control of the energy agenda, as countries position themselves to influence the low-carbon transition’s trajectory. Tensions from the Ukraine crisis, and the wider shift to multipolarity, further complicate the consensus-driven COP process.

Stoking the Flames

In a May 23 letter to US President Joe Biden and European Commission President Ursula von der Leyen, 133 progressive US and European lawmakers argued a change in COP28 leadership is needed to help ensure a productive summit. The litany of complaints led off by highlighting Adnoc's plans to expand oil output, which the lawmakers alleged means additional production of 7.6 billion barrels in the coming years. Climate advocates have also focused on al-Jaber's comment last month that climate technologies could remove up to 25 billion tons of carbon emissions per year, arguing that this target is unrealistic and offers a license to continue producing fossil fuels.

It's no surprise that the appointment of an oil executive in a key producer state has stoked controversy. The first-ever "global stocktake" mandated by the 2015 Paris Agreement means the stakes in Dubai are high. Against such criticism, UAE officials underscore al-Jaber’s renewable credentials as founding CEO of UAE-owned clean energy giant Masdar. Proponents also point to his track record of “getting things done.”

Western governments have mostly stayed on the sidelines. Earlier, US climate envoy John Kerry and European Commission Vice President Frans Timmermans openly backed al-Jaber's appointment. Kerry noted Adnoc’s commitment to the transition while acknowledging producer states like the UAE face finding “some balance” ahead.

World Reshaping

But the sharpening tensions reflect the increased divisions between energy producers and consumers as pressure for climate action has intensified. Two years ago, Western consumers seemed to be seizing the initiative, lending stronger policy and financial momentum to the low-carbon transition. The International Energy Agency issued a report in May 2021 setting out a path to net-zero emissions by 2050 that said no investment was needed in new oil and gas developments. Oil and gas companies were famously sidelined at the 2021 COP26 summit in Glasgow. US-Saudi tensions intensified after Washington started to accelerate the transition pace, while also inserting itself into oil market management.

But the oil sector pushed back hard for more influence — helped both by the location of COP27 in Egypt and COP28 in the UAE, and by elevated concerns about oil and gas supply security from the Ukraine crisis. COP27 in Sharm el-Sheikh saw record attendance by oil lobbyists and a final communique that preserved a role for fossil fuels via a "low-emission" energy pathway. EU ministers at one point threatened to walk away from the talks.

The wider struggle continues to play out — with Europe and the US pushing for a faster transition; Mideast and other producers seeking a more moderate pace and continued role for (lower-emission) fossil fuels; and India, China and much of the developing world somewhere in between. This already intense contest has been further shaped by broad geopolitical changes. The Ukraine war shone a spotlight on the limits of the West’s reach, with much of the “Global South” declining to take sides and putting their own national interests front and center. India has lapped up discounted Russian crude, while noting Europe’s self-interest in pulling LNG supplies from other markets. The crisis’ spotlight on near-term oil and gas supplies also emboldened Gulf producers, complicated EU positioning on fossil fuels and the transition, and helped foster deeper ties between China and the Gulf — seen as coming at the expense of US influence.

Unruly COPs

All this means the challenges around orchestrating a successful COP outcome have only mounted. The push for stronger action on fossil fuels is not limited to Europe — an attempt at COP27 to widen language from the phasedown of unabated coal to fossil fuels drew support from more than 80 of 197 nations, from the US to small island nations. But equally, hesitance about a faster transition is not confined to oil producers — some developing countries share these concerns, want a continued role for coal or gas or link support to promised financial and other assistance.

Yet COP diplomacy is rooted in consensus, making summits notoriously difficult and unwieldy processes that almost always overrun. Last minute interjections can dilute or remove hard fought for language aimed at accelerating momentum. The process is full of noise, friction and horse-trading. COP presidents are often career politicians who attempt to steer signatories with wildly different agendas toward a conclusion. “The role of the COP president is to guide the discussion; they don’t really get to set the agenda that much,” says Ben Cahill of the Center for Strategic and International Studies. Attempts to steamroller an agreement, as at the Copenhagen summit in 2009, can go badly wrong, notes a veteran COP observer. And at this COP, the issues increasingly at stake — phasing out unabated fossil fuels, compensation for climate damage and climate finance — are problematic ones that “transcend the host” country, Cahill says.

Still Confident

The UAE still seems confident of its ability to get a result in Dubai. “We believe that Dr. Sultan’s experience” as a senior global industry leader and an engineer working across the energy spectrum “will help drive the UAE’s transformative approach to COP28,” a COP28 spokesperson said last week.

Europe’s influence as a climate leader may be weakened somewhat after it stepped up coal-burning and scrambled for LNG supplies in response to the Ukraine crisis. Some splits were also evident at the recent G7 meeting in Hiroshima, where Germany joined Japan in backing public investment in natural gas.

Al-Jaber is certainly ambitious on low-carbon energy, having called for a tripling of renewables capacity to 2030, and then another doubling to 2040. That eagerness, including to prove its critics wrong, could stoke efforts to strike sweeping deals and come armed with headline-grabbing investments and finance deals, in particular from Asia — playing to strengthening Mideast Gulf-China ties. While all this could strengthen the Mideast’s hand and weaken that of Europe and the US, it doesn’t preclude a showdown over an accelerated offramp for fossil fuels. The saving grace may be that no one really wants to see the COP process collapse.

Policy and Regulation, Low-Carbon Policy, Carbon Capture (CCS), CO2 Emissions
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