Global climate negotiators have reached a framework for a fund to help vulnerable nations deal with loss and damage from climate change, reports Bloomberg, but the breakthrough “was marred by sparring over exactly how the programme would be funded”. It continues: “Delegates meeting in Abu Dhabi agreed late Saturday that the World Bank will host a new loss and damage fund on an interim basis for four years – breaking an impasse after months of negotiations. They also set basic guideposts for funding, with developed countries urged to provide support. The discussion next heads to [COP28].” The newswire quotes Sultan Al Jaber, the president-designate of COP28, who says the document is “clear and strong” and “paves the way for agreement”. He adds: “Billions of people, lives and livelihoods who are vulnerable to the effects of climate change depend upon the adoption of this recommended approach.” However, activists and representatives from poorer nations “said they were disappointed to leave without a commitment for an immediate and significant infusion of money, and tensions now threaten to spill over into the broader climate talks”, the article says, and notes that “even as the pact was reached, the lead US representative objected it didn’t reflect consensus”. The Times of India says the framework includes a compromise that “the fund will be based on ‘voluntary’ instead of ‘mandatory’ contribution from the rich nations as part of their historical responsibility”. But, Bloomberg notes, the US “lost its bid for language that would have made clear contributions are purely voluntary”. The Financial Times explains that “the US lead negotiator left the room while other countries on the 24-person committee agreed to a set of recommendations involving financing and structure”. It continues: “After the gavel came down, the US returned and made its objections to the final text.” The US Department of State said it was pleased the committee had been able to “reach agreement on many aspects of loss and damage funding, including a new fund”, the FT reports, but, the statement adds: “We regret that the text does not reflect consensus concerning the need for clarity on the voluntary nature of contributions; any contributions to funding arrangements, including to a fund, are on a purely voluntary basis.” The recommendations approved on Saturday “now need to be signed off at COP28”, the outlet adds. Politico reports that the “fragile agreement” came after “hours of acrimonious haggling” and quotes Lien Vandamme, senior campaigner at the Center for International Environmental Law, who says: “That the US finally could not even agree with the massively watered down text after cornering developing countries into accepting it, is a testimony to its lack of good faith effort to actually deliver an effective fund.”

Inside Climate News explains that, “as currently envisioned, loss and damage funding is completely voluntary, with the amount in the fund dependent on what developed countries are willing to contribute. There will be periodic reviews to assess whether the funding is keeping pace with the spiralling cost of climate impacts, similar to the voluntary emissions cuts pledges made under the Paris Agreement.” The Associated Press quotes Mohamed Nasr, the lead negotiator from Egypt, who says the agreement “falls short on some items, particularly the scale and the sources [of funding] and [an] acknowledgment of cost incurred by developing countries”. Another Financial Times article says that western countries “have clashed with Saudi Arabia” over the role the kingdom should play in the fund. The US and EU asked Saudi Arabia to be among those to contribute to ensure that the fund has as wide a donor base as possible, the newspaper explains. And the Guardian notes that “many argue” that “large oil and gas producers such as UAE and Saudi Arabia should become donors to the loss and damage fund”. However, they are “currently exempt as they are still classed as developing countries under the 1992 UN framework convention on climate change”. It adds: “UAE has not said whether it will pay into the fund, but the Guardian understands that positive discussions are taking place.” 

Reuters notes that the negotiating committee “resolved to recommend the World Bank serve as trustee and host of the fund”, which is “a tension point that has fuelled divisions between developed and developing nations”. It continues: “Housing a fund at the World Bank, whose presidents are appointed by the US, would give donor countries outsized influence over the fund and result in high fees for recipient countries, developing countries have argued. To get all countries on board, it was agreed the World Bank would serve as interim trustee and host of the fund for a four-year period.” The newswire quotes Harjeet Singh, head of global political strategy at nonprofit Climate Action Network International, who says: “Rich countries…have not only coerced developing nations into accepting the World Bank as the host of the loss and damage fund, but have also evaded their duty to lead in providing financial assistance to those communities and countries.”

David Archer, head of programmes at ActionAid, writes with a warning in Climate Home News that “being hosted by the World Bank is expensive and it erodes your independence and identity”. And Nik Nazmi bin Nik Ahmad, Malaysia’s minister of natural resources, environment and climate change, writes for Euronews that “establishing a fund under the World Bank’s purview…would grant donor countries disproportionate sway over the fund and could potentially mean exorbitant fees for recipient nations”. He adds: “It also enables western nations to shirk their responsibility towards meaningful climate financing – allowing them to conveniently pass the buck to an institution with a track record of delays and inadequacies.”

The UK government is to introduce a new bill in tomorrow’s King’s Speech to award licences for oil and gas projects in the North Sea every year, reports BBC News, which says the resulting projects “would have to meet net-zero targets”. The story makes the frontpage of several outlets. The Guardian explains how the process would work: “Under the plans, the North Sea Transition Authority (NSTA) will invite applications for new production licences on an annual basis, which the government said would provide certainty and confidence to investors and industry. Each yearly licensing round would only take place if key tests are met that support the transition to net-zero. The first test is that the UK must be projected to import more oil and gas from other countries than it produces at home. The second is that the carbon emissions associated with the production of UK gas are lower than the equivalent emissions from imported liquefied natural gas. If both these tests are met, the NSTA will be required to invite applications for new licences.” According to Sky News, the “government says granting new licences is justified because the UK still relies on oil and gas for most of its energy needs and will continue to do so even if it reaches net-zero in 2050”. But, although the government says more oil will add to energy security, the outlet notes that the “majority is expected to be sold to Europe and then reimported as refined products”. The Financial Times says that the NSTA “has acknowledged that any new licensing will do little to reduce Britain’s dependence on imports or affect prices of oil or gas significantly, given that the basin’s reserves are in decline and the commodities are traded on international markets”. 

The Independent quotes energy secretary Claire Coutinho, who says: “It’s common sense to make the most of homegrown advantages and use oil, gas, wind and hydrogen on our doorstep in the North Sea.” The government says the move will “help support up to 200,000 jobs and bring in billions of pounds in tax receipts”, reports the Times. Reuters notes that “Labour has said it will stop issuing new oil and gas licences in the North Sea, though it will respect any that are granted before any election”. The Daily Telegraph says “it is unclear if the new law being unveiled by the Tories will actually lead to any more oil and gas licences being issued than has been seen in recent years, if they remain in power”. The newspaper also publishes a commentary by Coutinho, who says: “No one can doubt that we will continue to lead the world on tackling climate change, and using our domestic oil and gas will not hinder our ambitious targets.” An editorial in the Daily Mail says the move will be “popular”, adding that “with a general election looming, it is vital the King’s speech contains measures that will benefit voters in the short term”. The Press Association, Sun, Daily Mail and ITV News all have the story.

UN secretary general António Guterres will be seeking assurances from the UK that there will be no reneging on climate promises, after Rishi Sunak’s rowing back on climate measures, reports the Guardian. Amina Mohammed, deputy secretary general, tells the newspaper that the UN was “absolutely” concerned about backsliding on climate commitments because “there is a lot of it” and that “this is what brings more mistrust into the room, that suddenly the goalposts may be changing”. She adds: “Certainly, the secretary general will be leaning in to have those conversations with countries like the UK, the US, China, many [others]. It doesn’t stop…We have to keep them in the room [discussing climate action]. We need to get out of everyone the best of the ambition that is expected from us.” 

Meanwhile, Sky News reports in an “exclusive” that a group of MPs is pressuring Rishi Sunak to lobby other countries to commit to a “phase out” of fossil fuels at COP28. It continues: “Over 50 cross-party MPs and peers have written to the prime minister with demands they see as critical to ensuring the UN summit in Dubai is the ‘moment that current and future generations need it to be’. They want the UK to use its influence to bring about the ‘end [of] the fossil fuel era by urging the phase out of coal, oil and gas’, they said in the letter, shared with Sky News.” The letter, which was organised by the climate all party parliamentary group, was signed by members from all major parties, though “primarily by Labour figures” and with “only two Tories”, the outlet adds.

Finally, in “exclusive research” by the Press Association, more than 1,000 people in the UK were asked whether they believe commitments made at COP28 will result in action, and “just 1% said it is certain to, followed by 4% who said they believe it is very likely”.

Colombia and its neighbours will together push six key themes at this year’s UN climate conference, including help adapting to global warming and swapping debt for climate mitigation, the country’s environment minister Susana Muhamad tells Reuters. According to Muhamad, Latin American countries will arrive ready to push for common goals thanks to regional meetings earlier this year, the newswire reports. Muhamad says: “Latin America has traditionally negotiated separately, but we’re going to start seeing ourselves represented on some points of agreement and negotiate together.” As well as pushing for help adapting to climate change, Muhamad says Latin American countries will call for the region to be covered by early warning systems to save lives amid disasters due to climate change, Reuters notes. On climate finance, Muhamad says: “I wouldn’t settle on a figure, but rather that mechanisms be made available for the scale of the problem.”

In other COP28 news, Yale Environment 360 looks at how “a growing number of nations and business leaders are calling for a phase-out of fossil fuels”. The Australian Financial Review reports that Germany’s international envoy on climate Jennifer Morgan has “called on Australia to support a push by Germany and the European Union for a phase-out of fossil fuels” at the summit. The Guardian reports the comments of Maria Neira, World Health Organization’s top environment expert, who warns that politicians who delay climate action should be prepared to live with the human fallout of their choices. And Business Standard reports on the “new climate initiatives” that Arab countries are planning to launch at COP28.  

China’s state-backed steel association says that the EU’s carbon border adjustment mechanism (CBAM) “creates a new trade barrier” for Chinese exporters, reports Reuters. The association says that “CBAM…goes against the principle of ‘common but differentiated responsibilities’” and has urged for more discussions with the bloc to address climate issues, it adds. Another Reuters article reports that Chinese president Xi Jinping says that China-Germany cooperation has become “more robust”, but that he “hoped that Germany would push the European Union to uphold the principles of marketization and fairness” in a call with German chancellor Olaf Scholz that covered climate goals. Chinese outlet National Business Daily carries an interview with Guan Dabo, one of the main authors of the fifth assessment report of the UN Intergovernmental Panel on Climate Change (IPCC) and the deputy dean of the school of carbon neutrality at Tsinghua University. He argues that the carbon tariff imposed under CBAM could “accelerate the green and low-carbon transformation of Chinese enterprises”, and stresses that EU estimates of China’s carbon emissions are “significantly higher” than those calculated by Chinese researchers. 

Meanwhile, Axios predicts the meeting between US climate envoy John Kerry and his Chinese counterpart Xie Zhenhua, which concludes today, could result in a “joint statement on US-China climate cooperation”. The state-run newspaper China Daily reports that Xi Jinping sent a letter and endorsed the fifth China-US friendly cities symposium, themed “building green cities together”. The Communist party-backed newspaper Global Times announces that a Chinese foreign ministry spokesperson said Xie and Kerry will have an “in-depth exchange of views on promoting actions and cooperation on climate change and supporting the success of COP28 in Dubai”, although it also called for the US to “show more sincerity” to preserve ties. China Daily carries an editorial saying that Washington is playing a “provocative geopolitical game” and that “the future of Sino-US relations is win-win cooperation and fair competition, or there is no future at all”. 

Bloomberg writes that Chinese companies could invest a total of nearly $2.8bn in Zimbabwe’s mining and energy sectors, “as the government pushes to develop some of Africa’s biggest lithium deposits and end power outages”. The Communist party-affiliated People’s Daily reports that China and Argentina have agreed a project to develop the “largest solar power station” in South America, with a capacity of 315 megawatts. Political theory magazine Qiushi carries a commentary by Zheng Shanjie, chairman of the national development and reform commission (NDRC), the country’s top economic planner, who writes that China should strengthen cooperation with other countries in “green infrastructure, green energy, green transportation, green finance under a green BRI”. Finally, the independent newspaper Guangming Daily publishes a commentary by Zuo Fengrong, a researcher at the central party school, saying that the joint construction of the “belt and road initiative” has become an “important force” in the global energy transition.  

Robert Habeck, Germany’s economics and climate minister, and Claire Coutinho, the UK’s energy and net zero minister, signed a statement on Friday intended to deepen the countries’ cooperation in the energy sector, reports Merkur. The outlet says that the collaboration includes plans to build a new subsea power cable, named the NeuConnect Interconnector, expected to become operational in 2028, to transport electricity generated by offshore wind farms in the UK to Wilhelmshaven, Germany. According to Habeck, up to 1.5m German households could be supplied with “reliable, affordable and clean” energy through the cable, notes the outlet. Additionally, an interconnector between Niederlangen and Essex is planned, with operation expected by 2030, according to the article. Bloomberg adds that there is also a plan for an underwater cable, which would run about 850km from northern Germany through the North Sea incorporating Scottish wind farms. Redaktionsnetzwerk Deutschland highlights that hydrogen played a “crucial role” in the discussion between Habeck and Coutinho, especially its potential to “transform” the German steel industry if imported from the UK. Die Zeit reports that Habeck advocated for extending the exemption of tariffs for German electric cars in the UK, which is expected to expire at the end of the year due to Brexit.

Meanwhile, Bloomberg reports that Habeck has “pushed back” against doubts, expressed recently by the German finance minister Christian Lindner, that Germany can phase out coal by 2030. It is “absolutely” the plan to switch off all coal plants by 2030 – eight years earlier than the current legal date, the Green politician said Friday in an interview with Bloomberg.

A new report suggests that, while almost half of the world’s 2,000 biggest listed companies have set a net-zero target for the middle of the century, “just a fraction meet tough UN guidelines for what constitutes a quality pledge”, Reuters reports. According to Net Zero Tracker, corporate targets from Forbes2000 index companies had jumped 40% to 1,003 in October 2023, from 702 in June 2022, covering two-thirds of revenues, some $27tn, the newswire says, adding: “However, just 4% of the targets meet the criteria laid down by the UN’s Race to Zero campaign, for example by covering all emissions, starting to cut them immediately, and including an annual progress update on interim and longer term targets. Of those to set a target, just 37% had one that covered their scope 3 emissions, or those tied to a company’s value chain. Just 13% had a quality threshold for the use of carbon offsets.” Reuters quotes Net Zero Tracker’s John Lang, who says: “A clear line in the sand on net-zero has surfaced. Countless net zero targets are credibility light, but now we can say for certain that most of the world’s largest listed companies are on the right side of the line on net-zero intent.” Axios also has the story.

Elsewhere, Simon Morrish, founder and chief executive of clean energy start-up XLinks, writes in the Times on “how business can move the needle on tackling climate change”.

While wind power has proved sceptics wrong by “developing giant turbines so efficient that they could compete with fossil fuels on their own terms”, a series of setbacks have “tipped an industry that’s critical to the world’s decarbonisation goals into a crisis”, write three Bloomberg journalists in a news feature. These setbacks include the Covid-19 pandemic, which has “disrupted the global economy and trade, pushing up the cost of pretty much everything, including commodities, labour and borrowing”, the journalists write, and “it doesn’t take a big bump in capital spending to sink a wind project”. But, they add, the combination of using low bids to win contracts to supply power, far-flung suppliers and “innovating so fast that there’s a risk new designs are being put to real-world use before they’ve been properly tested” means the industry is partly to blame as well. To solve these setbacks, the article notes that the industry wants “governments to simplify the way wind projects are approved so it’s quicker, less risky and therefore cheaper”. They are “also demanding more network investment to fix years-long delays in connecting wind farms to grids still largely designed for the fossil-fuel era”, the authors note. The lengthening list of cancelled and delayed wind projects shows that “if governments are committed to offshore wind, they’ll have to pay more to get it”, the article warns, adding that solar is unable to “pick up the slack”.

In related news, Reuters reports that Danish energy firm Orsted’s “shock decision to cancel two offshore wind farms off New Jersey this week was based in large part on big delays securing the ship it needed to build the project”. The Financial Times looks at how “green energy investment headwinds threaten [US president] Joe Biden’s climate targets”. The Daily Telegraph’s world economy editor Ambrose Evans-Pritchard writes that the Orsted “fiasco” will “not derail the onward march of offshore wind”. And the Daily Telegraph says that Orsted is “exploring ditching state subsidies in favour of private power deals” as it “scrambles” to boost the finances of the planned Hornsea 3 project in the UK.

A low-carbon transition could bring “consistent job growth” to the US, according to a new study. The authors combine a “power-sector optimisation model”, an employment impact model and demographic databases to understand state-level impacts of a low-carbon transition in the US. They find that almost all states could see job growth in the power sector under most scenarios, but the main fossil fuel-producing states need to prepare for fewer mining jobs and may see less job growth. The paper notes that the lowest skilled workers are likely to experience the most uncertain employment outcomes. It adds that “expanding renewable energy could improve opportunities for women in fossil fuel-dependent states, but not enough to disrupt the national gender status quo”.