Fairness and finance: At COP27, Australia stands in the middle of tense climate talks

Sharm el-Sheikh: As expected, the COP27 climate talks in Egypt have devolved into a stand-off between rich nations and poor ones over fairness and finance.

Australia finds itself at the centre of the action with just two days left to negotiate an outcome.

There is a brutal and simple dynamic at play here in Sharm el-Sheikh at the 27th United Nations Conference of the Parties.

Demonstrators demand pay for loss and damage at the COP27 UN Climate Summit in Sharm el-Sheikh, Egypt.Credit:AP

It is this: in climate talks rich nations care most about driving down emissions so as to stave off the worst impacts of warming; while poor nations are also focused on securing finance they need not just to cut emissions, but to even survive warming they did not cause.

And at these talks, the rich nations hold all the cards.

This takes a little explaining.

Under the terms of the Paris Agreement, emissions reduction commitments are only brought to the table every five years. That is why COP26 in Glasgow last year mattered so much.

The rich world was willing to horse trade – and to (promise to) put more money on the table – because they wanted global consensus on deeper greenhouse gas cuts.

But this year emissions targets aren’t on the table, so the developing world, gathered in a UN grouping known as the G70 plus China, has big financial demands but little leverage.

Nonetheless, the G70 has proved determined and united.

When the talks began on November 6, they fought for 40 hours to have payments for climate loss and damage included on the agenda and succeeded.

By Wednesday night few thought negotiations would conclude by the scheduled close on Friday night.

Another issue adding to tension is the failure of rich nations to live up to another of their financial commitments, a promise made in 2009 to collectively mobilise $US100 billion per year by 2020 for developing nations to use for things like clean energy infrastructure.

That figure has never been reached and this failure constitutes a breach of trust that has cast a pall over the broader proceedings.

And this is where Australia comes in.

On Wednesday night the Egyptian COP presidency asked Australian Climate Change and Energy Minister Chris Bowen to lead negotiations with his Indian counterpart over a replacement for the $US100 billion agreement that expires in 2025.

This sees Bowen placed in the heart of the sprawling beast that the UN climate talks have become, just as he pursues a bid for Australia to host its own climate summit with Pacific island nations in 2026. And he is doing it aside one of Australia’s key international partners, India.

India’s role at these talks is outsized too.

This week India called for oil and gas to be targeted for reductions along with coal in any COP27 deal eventually reached.

This is significant because in Glasgow only coal was mentioned in the final deal.

India’s argument is that coal is relied upon by poorer nations and should not be singled out while the developed world’s preferred energy tipples, gas and oil, are quarantined.

Some see this as a tactical distraction of a coal giant, but it is gaining traction in the conference, even winning support from the EU’s climate chief Frans Timmermans.

“We are in support of any call to phase down all fossil fuels,” he told a news conference.

Frans Timmermans, executive vice president of the European Commission, attends a session at the COP27.Credit:AP

“But we also have to make sure that this call does not diminish the earlier agreements we had on phasing down coal, so if it comes on top of what we already agreed in Glasgow, then the EU will support in this proposal.”

The problem is, explains Alden Meyer, a veteran of climate diplomacy and senior associate at the global think tank E3G, that there are some countries that will “go to the mat” to defend oil and gas.(He won’t name them, but others point the finger at Saudi Arabia and other members of OPEC.)

If India pushes the case it is possible that for the first time a UN climate conference will explicitly call for the phase-out of the three fossil fuels that have forged the modern era.

But it could also go the other way.

Depending on how the next couple of days play out, the decision may mention none of them at all, and thus deliver a weaker agreement than the one forged in Glasgow a year ago.

In a world suffering so obviously from its rapidly shifting climate, that would be a catastrophic failure.

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