DECEMBER 6, 2023

Greetings from somewhere in the skies between Dubai and Seattle.

It has been a whirlwind several days on the ground at COP28, and Bill Spindle is there until the end, so drop him a note if you are too: bill.spindle@ciphernews.com.

On top of reporting, Bill and I have spoken at numerous events (I stopped counting after 10!). Among the highlights: Hosting the Climate Innovation Forum and joining the Energy Gang podcast.

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Send your energy photos, story tips and more to news@ciphernews.com.

COP28 attendees walk down one of the main pathways in the sprawling Expo City complex, which is larger than Central Park. Photo by Bill Spindle.

Oil and gas companies step into the spotlight at COP28 

BY: BILL SPINDLE

DUBAI, UNITED ARAB EMIRATES — The fossil fuel industry took center stage during the first half of the United Nations climate conference, making pledges to reduce their greenhouse gas emissions in anticipation of a second half where the long-term viability of their core products will be questioned as never before.

The summit comes after a year of controversy over the host country, the United Arab Emirates, appointing the chief executive of its national oil and gas company to lead the world’s most prominent global conference to address climate change. And the conference, known this year as COP28, is taking place during what will be the hottest year on record, according to the European Union's Copernicus Climate Change Service.

About 75% of greenhouse gases come from fossil fuels. The COP28 president, Sultan Al Jaber, who led the country’s renewable energy initiatives before becoming head of one of the world’s largest national oil companies, argued that is one of the reasons the oil and gas industry should have a more prominent voice in how to reduce emissions stemming from fossil fuel use.

Climate activists, environmental groups and countries pushing for major reductions in fossil fuel use have loudly objected to increased involvement from the oil and gas sector. They point to the industry’s history of downplaying, and before that even denying, the role fossil fuels play in creating the emissions that are causing the planet to warm.

With the UAE’s encouragement, more oil and gas companies and executives than ever before have joined the 100,000 delegates attending the conference. CEO Darren Woods became the first head of Exxon Mobil, the world’s largest private oil and gas company, to attend a COP meeting. National oil companies — the state-owned giants that produce the bulk of the world’s oil — attended en force.

The conference avoided a major tussle between wealthy and poorer countries at the start when the two sides quickly agreed to compromise in launching a special fund to pay for damage from climate change impacts in the poorer countries. Wealthy countries pledged to put more than $700 million into the fund to start. That is a tiny fraction of the hundreds of billions of dollars that will ultimately be needed, but the agreement launched the fund and allowed the conference to move on to other business.

From there, the oil and gas industry entered the limelight with several initiatives aimed at cleaning up the greenhouse gas emissions that come directly from the extraction and distribution of their products. As critics have pointed out, this set of emissions is far less than the emissions from the actual burning of the oil and gas after companies sell it.

Exxon and Saudi Arabia’s Aramco, the world’s largest state-owned oil and gas company, led a pledge by 50 producers to cut emissions from their own operations. More than half of the group were national oil companies, some of the most resistant to climate commitments in the past but also the hardest to police since they’re owned by governments that depend on their revenues.

Most significantly, the group set a goal of eliminating emissions of methane from their operations. Methane, the main component of natural gas and often a byproduct released during oil production, causes 80 times more warming effect than carbon dioxide and is responsible for about 30 percent of the current rise in global temperatures. But the gas — which is also emitted by cultivated rice fields, landfills and cattle burps — goes away in about two decades, compared to about a century for carbon dioxide.

Read the full article on Cipher’s website.

Lunchtime Reads and Hot Takes

WTF is the ‘Global Stocktake’? We explain the ‘heart’ of COP28 — POLITICO
Anca’s take: Handy primer as negotiations enter crunch time. The article answers 10 key questions, including how countries could respond to the inevitable verdict that the world is trailing on climate action.

Analysis: Emirati oil CEO leading COP climate summit lashes out as talks enter toughest stage — AP News
Amy’s take: The article gets into the dynamic of how Emiratis aren’t used to media holding them accountable. Notably, in a press conference, Sultan Al Jaber didn't address his comments in a recently surfaced video where he says to three women working on climate and gender that he’s “the man in charge.”

John Kerry shrugs off COP28 chief’s controversial fossil fuel remarks — POLITICO
Anca’s take: It's significant that Kerry addressed Al Jaber's comments, especially as the world is zooming in on the COP president's every word, with concerns this may negatively affect the final negotiations.

Indonesia Speeds Up Landmark Closing of Java Coal Plant — Bloomberg
Bill’s take: This may sound insignificant, but any coal plants closing down is a good sign since the region has one of the more emissions-intensive power systems on the planet.

Why No One Wants to Pay for the Green Transition — The Wall Street Journal
Amy’s take: This article makes some important points, though I would encourage some humility in not knowing what the future may hold and many economic cycles are just that — cyclical.

Renewed Israel-Gaza war crowds out climate at COP28 — POLITICO
Amy’s take: Such a development is unsurprising, but it’s still notable to see its impacts, such as the mysterious lack of speeches from some leaders and behind-the-scenes war talks.

COP must lift the omerta on fossil fuel subsidies — Financial Times (paywall)
Amena’s take: These subsidies run into trillions after accounting for environmental damage and failure to reach climate goals, dwarfing the climate financing sought by poorer countries.

Mapped: World’s biggest polluting countries as Cop28 gets underway — The Independent
Anca’s take: To better understand countries’ positions (and oppositions!) during the summit, it’s important to go back to basics and get a sense of who emits how much today. This color-coded map is a useful tool.

Dubai’s Costly Water World — The New York Times
Amy’s take: This article scrutinizes Dubai’s immense use of desalinated water for opulent uses and raises concerns about the environmental impact. Being on the ground here, I see this regularly. What’s more, it appears much (if not most) drinking water here is actually bottled water anyway.

UAE to launch $30bn investment fund at COP28 — Financial Times (paywall)
Anca’s take: That’s not pennies — drawing in more private investments as part of a wider climate finance package is key. The move comes as the UAE attempts to bolster its credentials as host of COP28.

More of what we're reading:

• Climate Negotiators Get Down to Business at COP28 Summit — Bloomberg

  China’s First Next-Gen Nuclear Reactor Enters Commercial Operations — Bloomberg

• Biden administration expected to tackle ‘pillars’ in clean hydrogen tax credit guidance — POLITICO
• Skyscraper-studded Dubai has flourished during regional crises. Could it benefit from hosting COP28? — AP News
• Biden team releases EV tax credit foreign sourcing plans — Axios
• Biden Administration Unleashes Powerful Regulatory Tool Aimed at Climate — The New York Times 

How Prometheus sheds light on Africa’s energy future

A motorcyclist transports a solar panel in dense traffic in Bukavu in Eastern Congo. Photo credit: Kay Nietfeld/picture alliance via Getty Images.

BY: ANDREW KAMAU

Kamau is managing director of the Energy Opportunity Lab at the Center for Global Energy Policy at Columbia University and former principal secretary for petroleum and mining in Kenya. You can reach him at ak5023@columbia.edu.

Human progress has always been intertwined with our ability to harness energy, propelling us from one era to the next. From the myth of the Greek God Prometheus stealing fire to the present-day energy transition, our collective journey has been marked by ingenuity and adaptation.

Throughout history, we have transitioned from primarily using wind, water, biomass and animal power to relying on the power of the ancient sun locked in hydrocarbons buried deep beneath Earth’s surface. These shifts were driven by the pursuit of efficiency, enabling us to live more humanely by freeing us from mundane tasks and elevating our quality of life.

The current energy transition isn’t humanity’s first, but it is perhaps the most monumental. Unlike its predecessors, this transition is urgent — and must benefit everyone.

While people in wealthy economies have enjoyed the benefits of modernity, others have been disproportionately burdened by the consequences. Emerging economies, which reaped few rewards from the feast of energy progress, paradoxically now find themselves paying the price for the rise in quality of life in wealthier nations.

A successful transition will require wealthy economies, like the United States and Europe, to massively reduce their use of fossil fuels while scaling up new energy technologies. Crucially, it will also require fostering economic opportunity, social progress and climate resilience in emerging economies.

Read the full article on Cipher’s website.

On net zero goals, corporate pledges rise but progress lags

Accenture: Destination Net Zero • Companies are considered to have a net zero target only if they have publicly stated it covers all scope 1, 2, and 3 emissions (in other words, their own direct emissions, those of their energy sources and of their suppliers).

BY: BILL SPINDLE

Companies are getting better at “talking the talk” of net zero, but they’re not doing nearly as well in “walking the walk,” according to a recent analysis by business consultant Accenture.

The corporate net zero movement got rolling in earnest almost three years ago in the run-up to a major international climate summit in Glasgow, Scotland. The Glasgow Financial Alliance for Net Zero (GFANZ) used the summit, known as COP26, to encourage companies to adopt net zero targets — deadlines by which time they would cut their greenhouse gas emissions down and offset remaining emissions by enabling reductions elsewhere through carbon credits.

Most chose 2050 as their target date, in line with the larger United Nations framework guiding global decarbonization efforts.

The initiative has traveled a bumpy road since then. Many companies signed up, but it quickly became clear that without near term goals, better measurement and restrictions on offsets, the promises would amount to little. They could even be counter-productive if emissions weren’t credibly offset, a problem that quickly emerged.

In an update before this year’s COP28 climate summit, which is underway in Dubai this week, Accenture looked at the 2,000 largest companies by revenue globally. They found the share of companies setting targets continues to grow, especially in Europe, with 37% globally now committing to achieving net zero emissions. And companies with targets are cutting emissions faster than companies without targets, they found.

But among companies that have made the commitment and have disclosed emissions data since 2016, half continue to increase their emissions, a third are cutting emissions but not fast enough to meet their targets and only 18% are actually on track to meet their 2050 targets.

To limit global warming to 1.5 degrees Celsius, the stretch goal the world has adopted, emissions must peak no later than 2025 and decline by 43% by 2030, Accenture noted.

AND FINALLY...

Amazon Rainforest exhibit

Bill snapped this photo of workers setting up an exhibit in a COP28 space called the Surreal Water Feature, which features a surrounding waterfall (using recycled water). It’s one of the many flashy exhibits and displays the United Arab Emirates has concocted for the global climate summit.

Each week, we feature a photo that is somehow related to energy, the thing we all need but don’t notice until it’s expensive or gone. Email your ideas and photos to news@ciphernews.com.

Editor’s note: In addition to supporting Cipher, Breakthrough Energy also supports and partners with a range of entities working to tackle climate change, including nonprofits, corporations, startups and research firms. For more information on Cipher’s editorial policy, click here.