COP27 Cables: China and Other Evasions

Policy-makers remain focused on how to restrict energy use and consumption, but the solutions come from abundance.

Photo Credit: Getty


Tuesday’s theme of the day was energy, which is a delicious irony considering how much of the COP27 discussion focuses on how to limit the availability of reliable, affordable energy. The big climate-policy news of the day took place in Bali, Indonesia, at the G-20 meeting. While flashy, it will do nothing to affect temperature this century. Policy-makers remain focused on how to restrict energy use and consumption, but the solutions come from abundance.

Tuesday’s Headline

The big news for climate policy took part thousands of miles from Sharm el-Sheikh when the United States, Japan, Canada, six other nations, and the European Union announced a deal, called the “Just Energy Transition Partnership,” or JETP, to wean Indonesia off coal. The money comes now — a total of $20 billion, including half in the form of sweetheart loans from the U.S, Japan, and other nations and half from private lenders — but the actual emissions reductions aren’t due until 2030.

Indonesia is among the top ten emitters of carbon dioxide, but more importantly it regularly vies for the top spot in coal production. Indonesia exports more than 70 percent of the coal it produces and is the source of nearly 75 percent of the coal imported by China. The JETP does not appear to address coal exports, only fuels for domestic electricity. Does the emissions profile of Indonesia matter if China continues to build coal-fired power plants? After all, China emits about 20 times as much carbon dioxide as Indonesia, and as Indonesia moves away from coal, we should expect downward price pressure on its exports as more becomes available to China.

What You Won’t Read in the Papers

The era of breakthrough announcements may be finished for the COP, though Reuters carries the conventional wisdom.

Ever greater promises, pledges, and bigger ambitions to transfer wealth from one country to another can still be announced at this or future COP meetings. Meanwhile, the media continues to focus on poorer nations and the stark problems they face. It creates space for activists and outrage to star while policy solutions take a backseat. But future breakthroughs that reorder the climate-change debates will come from innovation, which operates on a schedule independent of the United Nations.

Creating meaningful governance structures for a “commons” issue — the atmosphere is global, and 1.5 degrees Celsius refers to mean surface temperature change globally — is difficult. Notably, there are no effective enforcement mechanisms in the Paris Climate Agreements. It is aspirational.

Meanwhile the JTEP announcement was achieved with a more manageable group of 20 players. It is focused on mitigation, or reducing emissions, rather than the hot topic of COP27, which is loss and damage. Imagine putting 190 people in a room and asking them, with all their different objectives, to work out who will pay whom and how much. To make the thought experiment a little more realistic, remember that the COP decisions must be unanimous.

When the meetings were about aspirations, the COPs were a useful opportunity for wealthy nations to shape public opinion. Thirty years on from the first COP, they have turned to obligations with short timelines. There is no upside for wealthy nations that can never meet the demands of developing nations. They’ve taken their action to other venues such as the G-20 or given up on multilateral agreements and are focused at home.

Read the full article at National Review.