COP26 forges ahead with commitment to ‘seal coal’s fate’

A push for the end to coal-fired power is gaining traction in Glasgow, Scotland, at the ongoing COP26 climate action negotiations, as more countries pledge to phase out coal power and end support for new coal power plants.

If the world is to meet its target of keeping global warming under 1.5℃, the most ambitious goal in the 2015 Paris Agreement, it means slashing global emissions by almost half by 2030 and to "net zero" by 2050. Coal is the single largest contributor to climate change. The burning of coal produces 27% of the world’s carbon dioxide emissions, according to the International Energy Agency. 

The COP26’s UK host had set a goal of “consigning coal to history” and to “keep 1.5℃ alive” at the talks. The UK government hoped a formal commitment to the end of coal-based power would give impetus to the host’s hopes of a stronger deal. The Paris agreement, the global climate deal signed in 2015, does not explicitly mention the need to stop using fossil fuels and the UK hopes that this year’s conference will boost that ambition. 

About 200 countries and institutions have pledged to end coal-based power. Wealthy countries committed to phasing out coal around the 2030s “or as soon as possible thereafter”, and developing nations shifted their goal post to the 2040s. 

The pledge is backed by five of the biggest 20 coal power users: South Korea, Indonesia, Vietnam, Poland and Ukraine. Indonesia’s involvement is significant as the world’s largest thermal coal exporter. The inclusion of Poland, Europe’s most coal-dependent nation, is also a feather in the cap of the pledge, as its coal industry wields considerable political and economic influence in the country.

South Africa, Africa’s largest emitter, is not among the signatories at this stage. But the country, which generates 90% of its energy from coal, has committed to gradually phasing out coal in its economy, if it receives the necessary climate funding. It aims to have net zero carbon emissions by 2050.

Australia, which has a mining intensive economy, has also shied away from the coal commitment. The Guardian reported that Australia’s emissions reduction minister Angus Taylor, commenting on the pledge, said Australia “would not wipe out industries”.

Apart from the timeframes to move away from coal, the full statement commits the signatories“to support other countries to do the same.” It also commits the nations to stop issuing permits or support for new coal-fired power generation.

A separate group of countries, including the US, Canada and the UK, pledged to end overseas investment in coal, oil and gas by the end of next year. Neither statement was signed by Australia, China, Japan or India.

The UK’s Business and Energy Secretary Kwasi Kwarteng said that the end of coal was in sight. 

“The world is moving in the right direction, standing ready to seal coal’s fate and embrace the environmental and economic benefits of a future that is powered by clean energy.”

Delegates at the climate talks had mixed feelings about the coal phase-out pledge. Some said it was a significant step that would have defied belief just a few years ago.But critics pointed out that for the world to stay within the 1.5℃ target, rich countries should phase out coal before 2030, rather than in the 2030s.

Elif Gündüzyeli, senior coal policy coordinator at the campaign group Climate Action Network Europe, had a lacklustre response to the pledge. 

 “This is not a game-changer. A 2030 phase-out deadline should be a minimum, and this agreement doesn’t have that. Coal is already expensive compared with renewable energy, and no one wants to put money in coal any more.”

But Dave Jones, global lead for the climate think-tank Ember, said the commitment would help to shift entire continents to phase out coal. 

“This is such a big deal because by far the biggest gap in ambition to get to 1.5℃ is a short-term collapse in coal generation.”


Countries like South Africa hoping for a just climate transition, need rich countries to do more – new report

Have all countries done their fair share to slow down climate change? A new report, released this week from the COP26 climate summit in Glasgow, found that some countries – especially from the developed world – were not pulling their weight with the commitments they have made. 

The report, which scrutinised countries’ pledges made before the climate talks, was written by a global coalition of civil society organisations that includes the World Wildlife Fund. It addressed the notion of what a “fair share” is when it comes to the pledges being made by wealthy countries versus those made by developing countries. 

The global coalition’s report, Fair Shares Phase Out: A Civil Society Equity Review of an Equitable Global Phase-Out of Fossil Fuels, does not focus on countries’ “lofty emissions reduction targets decades in the future”, but examines how the expansion of fossil fuel extraction and use can be stopped now, and how this rapid phasing out of existing production can be undertaken in an equitable manner.

South Africa’s “just transition” to move away from coal dependency is featured in the report. The verdict is that the country will need serious funding to achieve this without damaging its economy through job losses. 

If the world is to meet its target of keeping global warming under 1.5℃, the most ambitious goal in the 2015 Paris Agreement, it means slashing global emissions by nearly half by 2030 and to "net zero" by 2050.

 

Wealthy countries must do more

The report found that although the contributions of the wealthiest countries (the United States, United Kingdom, European Union countries and Japan) fall far below what would be considered a fair share of the global effort, some less wealthy countries (including China, India, South Africa and Kenya) have mitigation pledges reaching about – or above – their full fair shares. 

​​”Unless all countries markedly increase their domestic emissions reductions, a future within 1.5°C will remain out of reach,” the report stated. 

“For wealthier countries this also means dramatically increasing flows of international financial and technological resources to less wealthy countries.”

 

South Africa ambitious, but needs more financial flows

South Africa is featured as a country case study in the report. It highlights that in order for the country to successfully complete a just transition it would need funding. 

South Africa is the most coal dependent country in the G20, using coal not only for generating electricity but also to produce liquid fuels. 

The largest coal users – state-owned power utility Eskom and coal-to-liquids corporation Sasol – account for more than half of South Africa’s emissions. This dependency on coal meant that a just transition for South Africa was critical to avoid damage to its economy, the report found. 

South Africa announced a watershed multibillion-dollar climate finance deal on Tuesday. France, Germany, the UK, the US and the European Union pledged R131 billion over the next three to five years in the form of grants, concessional loans and investment and risk-sharing instruments, including mobilising private sector funding.

The “Fair Shares Phase Out” report, submitted before this week’s big announcement, found that the country had received limited funding flows from rich countries.

 

Job losses are a concern

“Mining and power generation are major engines of the economy, especially in the Mpumalanga province, which produces 80% of South Africa’s coal and could thus face heavy socioeconomic impacts from a coal phase out,” the report stated. 

One analysis in the report estimated at least 25,000 forced job losses in a 2040 coal power phase-out. It quotes research that puts the bill at between $56 billion and $61 billion for South Africa’s power sector, which is mainly made up of Eskom, to shift to renewables and grid expansion.

It said that on balance, however, perceptions about the long-term viability of coal mining were shifting in South Africa.

“Major actors are divesting, and investment in production is declining. Eskom has stated they will not build more coal plants, and is pursuing a ‘just energy transition strategy’ that includes repowering plants with renewables.”

But this will require much more funding than the R131 billion announced this week, and the flow of funds for this has not been sufficient, the report found. 

 

Equity analysis: Rich countries have more work to do

The report applies a long-standing “equity analysis” to countries’ climate pledges to assess how each country is delivering on the Paris Agreement’s goal of pursuing best efforts to limit warming to 1.5°C.

“Questions of climate action are not only scientific, they are also moral questions,” said Lidy Nacpil, coordinator of the Asian Peoples Movement on Debt and Development. She explained that, since the Paris Agreement, civil society movements had also applied an ethical lens when examining countries’ pledges. 

“The results show that the actions proposed by countries … especially from wealthy countries like the UK and the US, are far from what’s required.” 

Sara Shaw of Friends of the Earth International said the report also identified a key gap in international climate action – fossil fuels. 

“It is the elephant in the room: international goals do not currently address the production of fossil fuels,” she said. 

The 2021 report conducted an equity assessment of countries’ pledges to cut their emissions - officially known as national determined contributions – that showed that their commitments for climate action remain deeply inadequate and unjust. 

Harjeet Singh, of Climate Action Network International and the Fossil Fuels Non-Proliferation Treaty Initiative, expressed discontent over the lack of coordinated international action based on principles of equity and justice among the nations of the world

“This remains a huge barrier to addressing the climate crisis. This report outlines how governments, if they listened to their people, could begin this historic and necessary shift,” he said. 

Mohamed Adow, founder and director of Power Shift Africa, said the world had spent too long talking about emissions reductions without highlighting clear steps to end fossil fuel supply. 

“Fossil fuel phasing out and energy transition are clear necessities to avoid the worst of climate change, especially for African countries who bear the least responsibility and worst effects. This report lays out clear imperatives to ensure that phase-out and energy transition can happen in a just and equitable manner.”


South Africa poised to capitalise on the rapidly developing global hydrogen economy

South Africa is powering ahead into a green hydrogen future, betting that this will be the new oil of the twenty-first century. 

Green hydrogen has been a hot topic at this year’s climate talks in Glasgow. South Africa has made it one of its three key priorities in its climate action plans, as it searches to lessen its dependency on coal. It was this climate plan that enabled it to attract a multibillion-dollar climate-funding deal, and South Africa will use part of the funds to invest in green hydrogen. 

Its future climate plans include fast-tracking plans for a green-hydrogen economy. It hopes to lure investors with innovative hydrogen infrastructure plans.

The other two legs of the plan entail a roadmap to decarbonise and recapitalise South Africa’s struggling power utility Eskom as well as boost electric vehicle infrastructure.

President Cyril Ramaphosa is especially excited about South Africa’s proposed green hydrogen projects, believing that this could give South Africa a competitive edge in an energy market looking for clean green opportunities. South Africa could become a major exporter of this fuel of the future.

“One of the new frontiers of infrastructure development is green energy, which has the potential not only to drive industrialisation, but to establish a whole new industrial reality,” he told delegates at an energy conference earlier this month. 

“I am pleased that our infrastructure developments are now going ahead of this curve, embracing the climate change narrative and debate, and making sure that it is a part of what we are doing.”

 

Fuel of the future

Hydrogen has often been labelled the fuel of the future, thanks to its abundance in nature and its clean-burning nature that emits only water vapour. But its extraction in the past was too intensive, and production was not cheap. While hydrogen is abundant, it has to be extracted from other substances, mostly water.

In the past few years so-called green hydrogen – hydrogen that is produced without any carbon emissions using renewable resources – has become economically viable. Green hydrogen is produced by splitting water by electrolysis, which produces only hydrogen and oxygen. The oxygen is released into the atmosphere with no negative effect on the environment.

Green hydrogen could be piped to homes in existing gas pipelines to power household appliances. Apart from its uses in industry, green hydrogen can also transport renewable energy when converted into a carrier such as ammonia, or used as zero-carbon fuel for shipping. 

In the future as technology grows it could replace gasoline as a transport fuel, or natural gas as fuel for power generation.

Investment bank Investec believes that there is huge potential for investment in the green hydrogen sector. In an investment note it argued that South Africa was well-endowed with renewable sources of energy, and was poised to become a leader in this field. 

Accounting firm PwC also advised investors that South Africa had a competitive advantage to produce and export green energy.

“Hydrogen is receiving an unprecedented level of international traction as the cost of renewables decline and carbon emissions are increasingly penalised,” said James Mackay, PwC Africa south market lead for energy.

Global momentum is growing across the hydrogen industry, with few sectors likely to remain untouched by this upcoming energy revolution. At the beginning of 2020, the global hydrogen project pipeline, across grey, blue and green projects, stood at $95 billion, PwC said. 

 

South Africa’s hydrogen potential

Trade minister Ebrahim Patel said South Africa had a rich endowment of renewable solar and wind resources, as well as the skill sets around Fischer-Tropsch technology that South African multinational Sasol perfected over many years. Fischer-Tropsch technology is a big boon in the extraction of hydrogen, and will help South Africa in the green hydrogen revolution. 

An added benefit, Patel said at his keynote address at the second Renewable Hydrogen and Green Powerfuels Webinar in April, was South Africa’s platinum group metals (PGMs) used in the electrolysers needed to produce green hydrogen as a fuel. 

“This places the country at an advantage for developing the green hydrogen value chain and being a key supplier into the global hydrogen market.”

Sasol, South Africa’s second biggest emitter, is also closing down its carbon intensive business model and opting to invest in green technologies including green hydrogen.

Fleetwood Grobler, CEO of Sasol, commented at the same webinar that Sasol wanted to use its grey hydrogen skills in the establishment of a green hydrogen economy for South Africa. Grey hydrogen is produced from natural gas, or from the gasification of coal.

 

The Northern Cape, Namibia and green hydrogen

South Africa’s flagship hydrogen project is the green hydrogen export special economic zone to be developed at Boegoebaai in the Northern Cape, with Sasol as an anchor investor. It is a major step towards realising SA's potential to be a global leader in green hydrogen.

Namibia is set to be a key part of this project as it is also embracing green hydrogen through its green hydrogen programme. Last month Ramaphosa and Namibian president Hage Geingob met to discuss cooperation in the green hydrogen space, with both believing there are enormous benefits for South Africa and Namibia.

The cooperation between the two countries suggests a future where tens of gigawatts of renewable energy feed electrolysers on a huge scale, producing the hydrogen power fuels of the future.

“We stand ready to be a major exporter in this market, to use hydrogen to rapidly decarbonise our existing industries, and attract industrial investment from across the globe seeking to meet new standards of green power in the production process,” Ramaphosa said. 


Namibia aims for the stars with climate targets, but needs funds to get there

Namibia’s aspiring climate targets, on the back of plans to become a world leader in hydrogen, has excited many delegates at this year's climate talks in Glasgow. But the southern African country will need funds to achieve this, its government warned. 

Namibia has some of the most ambitious climate targets on the table at the COP26 talks. But a key component of the country's energy transition will be to leverage its natural assets to attract much-needed foreign direct investment.

James Mnyupe, Namibia’s presidential economic adviser and hydrogen commissioner, said in a World Economic Forum on COP26 that his country was endowed with enough renewable energy potential to become a regional powerhouse that could significantly reduce sub-Saharan Africa’s reliance on carbon-based fuels.

In his address at the COP26 talks on Tuesday, Namibia‘s president Hage Geingob emphasised that Namibia was ready to become a climate pioneer. He said that the country had amplified its 2015 pledge in the nationally determined contributions, which determine how individual countries slash their emissions, and the country now aspired to reduce its emissions by 91% before the end of this decade. 

But, he warned, the estimated investment required to achieve this target was about US$5.3 billion, 10% of which would have to be unconditional finance.

 

Bye bye coal, hello renewable energy

 

Namibia would be one of the countries hardest hit by climate change and the country was eager to do more than its share to change things, hence its ambitious targets. And it believes that green hydrogen, along with a scaled up renewable energy programme, is the way to go. 

Hydrogen has often been labelled the fuel of the future, thanks to its abundance in nature and its clean-burning nature that emits only water vapour. But its extraction in the past was too carbon intensive, and production was not cheap. Although hydrogen is abundant, it has to be extracted from other substances, mostly water.

In the past few years so-called green hydrogen – hydrogen that is produced without any carbon emissions using renewable resources – has become economically viable for the first time. 

Green hydrogen is produced by splitting water by electrolysis, which produces only hydrogen and oxygen. The oxygen is released into the atmosphere with no negative impact on the environment.

Labeled as the “oil of the future”, green hydrogen could power vehicles, helping countries to discard their reliance on fossil fuels, particularly oil and coal. 

 

It could also be piped to homes in existing gas pipelines to power household appliances. Apart from its uses in industry, green hydrogen can also transport renewable energy when converted into a carrier such as ammonia, or used as zero-carbon fuel for shipping. 

 

Namibia was eager to support the “consign coal to history” movement, as per the rallying cry of UN secretary-general António Guterres.

Mnyupe said Namibia will support the phasing out of coal “by significantly scaling up solar and wind energy to support domestic demand, while working with our neighbours to responsibly phase out existing coal generation in the Southern African Power Pool and transform our region’s energy map”.

He said the amount of land available for renewable energy in Namibia gave the country a competitive edge. 

Namibia’s vast territory of more than 824,000 square kilometres, low population of just 2.5 million people, and annual energy consumption of only two and a half terawatt hours means that the country has one of the lowest energy-demand density scores in the world. 

“Often a key constraint to deploying large scale solar and wind assets is the limited amount of land given a country’s population density. When looking at land availability Namibia is uniquely gifted,” Mnyupe said. 

“Land availability is not a constraint to developing large scale renewable energy systems.”

 

Green hydrogen

 

Namibia’s proposed green hydrogen initiative attracted a lot of interest at COP26. The Namibian government views green hydrogen as an emerging market opportunity with the potential to spur national and regional economic growth. It planned to partner with other governments and the private sector to develop a green hydrogen economy. 

In August Germany and Namibia signed a joint communique of intent in Windhoek and Berlin to establish a partnership in the field of green hydrogen technology. 

German Federal Research Minister Anja Karliczek said the global race for the best hydrogen technologies and best sites for hydrogen production was on, and Germany was eager to partner with Namibia as an ideal site to take up hydrogen. 

She said Germany‘s Federal Research Ministry would provide up to $46 million to fund the partnership. 

“We think that one kilogram of hydrogen from Namibia will eventually cost between $1.70 and $2.30. This would be the most competitive price in the world, which would be a huge locational advantage for hydrogen ‘made in Namibia’.”

Saliem Fakir, executive director of the African Climate Foundation, labelled Namibia’s green hydrogen programme as an excellent example of a pioneering energy transition: “This is going to receive immense attention in the next couple of years.” 

 

A new renewable hub in the desert

 

Green Hydrogen will form the backbone of the Southern Corridor Development Initiative in Namibia’s Karas region, along with solar and wind projects. 

Geingob said that Namibia would make more than 5,700 square kilometres available in the Karas region for the potential development of green hydrogen and ammonia assets. 

 

This will triple the installed renewable energy generation capacity for the entire country, he said.

Mnyupe explained that the initiative envisioned including a portfolio of complementary infrastructure projects in the Karas region of Namibia. If effectively conceptualised and delivered it could have a transformative impact on the Namibian economy.

Karas, in Namibia’s southernmost province, has the lowest population density in the country but has the greatest renewable-energy potential.

Mnyupe said the region’s Luderitz port was well-positioned to act as a conduit to deliver green hydrogen and green ammonia – produced by green hydrogen – to the world.

 

COP26 has to be the turning point

 

Geingob believed that COP26 was the international community’s last chance to collectively overcome the disconnect between a dividend international system and a global calamity that threatened everyone.

He said, along with the world, Namibia is experiencing widespread and devastating impacts of key facets on civilisation, which included droughts and devastating veld fires that had destroyed large tracts of agricultural land and adversely affected livelihoods, human health and well-being.

“For these COP negotiations, there are critical objectives that are crucial to protect us all from the impacts from runaway climate change, breakdown of the biosphere and the death of the world’s oceans.”

 

Call for climate finance

 

He added that Namibia’s support for scaling up climate finance calls for the US$100 billion target for climate finance to be surpassed as a target, with a clear roadmap on how the committed amounts will be delivered.

Geingob was also in favour of grants, instead of loans, so as not to increase the debt burden on poor countries. 

“We urge for an increased volume of grants – rather than loans – to make it possible for emerging economies carrying high debt burdens to kickstart transformative projects,” Geingob said.


South Africa’s multibillion dollar climate finance deal lifts mood at COP26

South Africa’s watershed multi-billion-dollar climate finance deal announced on Tuesday gave much-needed hope to the UN climate talks after a lacklustre start. The deal has made South Africa a star performer at the talks, setting the scene for the country to transition away from coal to cleaner forms of energy.

The country has committed to ambitious targets to attract billions in climate funding from wealthy nations. South Africa is among the most coal-dependent nations in the world, and its commitments are a huge milestone at the conference.

In a historic deal, the South African government announced that France, Germany, the United Kingdom and the United States, as well as the European Union, had pledged R131-billion over the next three to five years in the form of grants, concessional loans and investment and risk-sharing instruments, including mobilising private sector funding.

In return for the funds, South Africa’s state-owned power utility Eskom will close down its coal power stations before the end of their normal lifespan, over the next 15 years. The funds will also assist Eskom to build a strong renewable energy sector. Apart from funding Eskom’s transition, South Africa will also use the funds to build a green hydrogen sector and help shift the nation's transportation to electric vehicles.

Funds will enable a just transition

An elated South African president Cyril Ramaphosa labelled the partnership a watershed moment not only for South Africa’s own just transition but for the world as a whole.

“It is proof that we can take ambitious climate action while increasing our energy security, creating jobs and harnessing new opportunities for investment, with support from developed economies.”

Deputy Chairperson of the Presidential Commission on Climate Change, Valli Moosa, said the deal will serve as a needed accelerant to decarbonise the South African economy “and support a just transition which prioritises the needs of workers and vulnerable communities”.

The announcement showed the commitment and resolve of the South African government to seek innovative funding and investment mechanisms to support the country’s decarbonisation efforts and ultimately propel it to reach its ambitious emissions targets, Moosa said.

He said the much-needed funding comes at a time when South Africa’s climate transition remains constrained by weak economic conditions, skills shortages, and a slim fiscal position.

Spark for new deals

This is the first significant financing deal to emerge from the UN climate talks, but delegates believed the South African deal could spark similar deals with other big emitters in the developing world.
Climate finance remains a sticking point at the climate talks, with evidence of rich countries’ broken promises looming over the conference this far. The developed world committed in 2009 to transfer $100 billion a year to the developing world to aid its transition to low-carbon economies by 2020, but that target was missed last year and a large gap remains.

Ramaphosa said bold and ambitious actions were required from all countries to confront climate change and South Africa has consistently argued that developed economies must support a just transition in developing economies.

“Today’s political declaration represents a first-of-its-kind partnership to turn these commitments into reality and a model for similar forms of collaboration globally.”

South Africa’s ambition

The South African president explained that a just transition sits at the heart of this partnership. This includes support for workers and communities affected by the transition away from coal and enables the creation of quality green jobs.

Before COP26 South Africa already took an ambitious leap forward in setting its Nationally Determined Contribution (NDC), which will determine how it cuts its emissions. Its revised target was compatible with the ambitious goals of the Paris Agreement and represented South Africa’s best effort to confront climate change. But South Africa was adamant that it would need money to achieve this.

Saliem Fakir, executive director at the African Climate Foundation, said the announcement was an amazing accomplishment for South Africa.

“It was all done in a very short space of time. This is a significant milestone in South Africa’s history. It is a big fundamental shift for the country’s energy sector, and for climate, in that we have never had something as groundbreaking as this.

He said the hard work began now to see the deal come to fruition.

Praise from world leaders

World leaders also recognised the deal as a landmark effort. COP26’s host The United Kingdom’s Prime Minister, Boris Johnson, labelled climate finance as a “game-changing partnership “ that “will set a precedent for how countries can work together to accelerate the transition to clean, green energy and technology”.

“Moving away from coal is essential if we are to meet our target of limiting global warming to 1.5 degrees. President Ramaphosa has shown real leadership on this issue, and the United Kingdom is committed to working with South Africa and our partners to support a just and fair transition to renewable energy.”

US president Joe Biden said that right now South Africa was the largest emitter in Africa due in large part to the heavy reliance on coal for power.

“By closing South African coal plants ahead of schedule and investing in clean power alternatives for the people of South Africa and supporting an equitable and inclusive transition in South Africa’s coal sector, we are following through on the pledge the G7 partners made in Cornwall to accelerate the transition away from coal in developing countries.”

France’s President Emmanuel Macron said the new partnership mobilised very significant support for South Africa's ambitious decarbonisation project for a just energy transition.

German chancellor of the Federal Republic of Germany, Angela Merkel was pleased that Germany was part of this important partnership with South Africa.

“We are committed to supporting both the decarbonisation of South Africa‘s electricity production and the development of new economic opportunities for affected communities.”

Greenpeace Africa also welcomed the announcement but added that it should be used for a real just transition and not become another empty promise of the South African government paying lip service to climate justice.

It cautioned that the funds should be used for just transition projects and not used as a ploy to ensure the longevity of carbon majors such as Sasol.

Greenpeace said the funds should be used to prop up Sasol’s fossil fuel derived hydrogen projects.
“Now more than ever, security must follow our government to ensure these finances serve their designated purpose and are not looted by our unscrupulous rent-seekers.”


Weak G20 statement sets the scene for tough COP26 negotiations

A lack of real commitments from G20 leaders over the weekend has complicated the task of climate negotiators at this year’s UN climate talks in Glasgow. There was hope that the meeting would have set firmer targets before COP26, but the official statement released on Sunday afternoon was described as “vague and weak" by critics. 

The COP26 talks started slowly on Sunday, with leaders on Monday acknowledging the urgency of the problem of climate change and warning that action is needed. Many of the world’s leaders' speeches emphasised that the world needed to do more, but many NGOs described this as mere hot air.  

Tangible results are rarely delivered in leaders’ speeches at the beginning of the conference but are negotiated in fraught negotiations towards the end of the 13-day climate talks, in negotiations that stretch late into the night. Still, negotiations had hoped for a boost from G20 leaders over the weekend.

COP26 President Alok Sharma, who presides over the talks on behalf of the UK who holds the presidency this year, alluded to widespread disappointment in the outcome of the G20 talks when he warned that "one meeting — be it the G20 or COP26 — isn't going to be able to address everything".

This year’s round of talks has to go further to meet the Paris Agreement’s ambition of keeping temperatures from rising more than 1.5 degrees from pre-industrial levels.

Negotiators from 200 countries, eager to show real progress at this year’s talks, had hoped that world leaders would give the talks a kickstart with a firm path on who should do what to slow down climate change.  

Some observers were buoyed that the G20 moved the Paris Agreement goalpost of when nations should reach zero net emissions to more ambitious targets: from the "second half of this century" to "by or around mid-century". But they failed to give a definite year in their final official statement. 

The G20, made up of 19 individual nations and the European Union members, convened in Italy for the G20 summit this past weekend, as we reported previously. The G20 is made-up of the world’s major economies, many of which helped fuel climate change over the past century, through greenhouse gas emissions during their industrialisation drive. The group accounts for more than 80% of the world's gross domestic product, 60% of its population and an estimated 80% of global greenhouse gas emissions.

Watered-down statement

In Sunday’s watered-down official statement, the leaders of the world's richest economies agreed to pursue efforts to limit global warming with "meaningful and effective actions" after the meeting. Countries agreed to stop financing overseas coal plants, tackle methane leaks and take greater action this decade to limit global warming. 

Leaders, however, could not set a precise date for phasing out fossil fuels and reaching net-zero emissions.

Analysts had hoped for stronger commitments. The buy-in of G20 nations, as the world’s biggest polluters, at COP26 in Glasgow is still crucial, as the nations could make or break the talks. 

At the very least, however, observers were glad to see some form of commitment coming out of the weekend talks, however small, and crucially that the talks between G20 leaders themselves had not broken down. 

South Africa is the only African country in the G20 due to its role as Africa's biggest industrialised country and the power it wields in the region due to a historically strong economy. South Africa is also a huge emitter due to its coal-dependent economy - one of the biggest emitters per capita at this weekend’s meeting. 

South Africa’s Minister of International Relations and Cooperation, Naledi Pandor who attended the meeting in place of president Cyril Ramaphosa, said after the G20 weekend the world needs to see far greater commitment and the objectives that have been spoken of for years must be achieved. “Vulnerable countries must be assisted,” she said, adding that action was needed now. 

US President Joe Biden said despite some productive meetings at the G20, he was "looking forward” to better progress at Glasgow. He took a dim view of China and Russia, who "basically didn't show up" for climate discussions. 

Neither China's President Xi Jinping nor Russia's Vladimir Putin were in Rome for the conference, instead joining via video link. Putin was also planning to stay home during COP26.

Lack of concrete figures

In terms of the Paris Agreement in 2015, countries committed to slashing their emissions as far as possible, while rich nations would support developing nations with financial aid to help them achieve their targets, as well as phase out coal.  

Despite this agreement, nations’ commitments to do more are moving at a snail’s pace.  

While G20 leaders agreed in Rome that they would channel post-Covid stimulus money into climate action, and use development banks to marshal more funds for poorer nations, they didn’t commit to concrete details on sums.

Critics also pointed out that while the G20 agreed to stop financing new coal infrastructure internationally, which would scupper proposed new coal plants in South Africa for example, G20 leaders stopped short of agreeing to end coal power in their own nations.

Year of net-zero?

The timeframe of when countries should reach net-zero emissions remains under contention. Scientists say this must be achieved by 2050 to avoid a climate catastrophe, and most countries have agreed to this.

That the G20 was able to move net zero emissions from the "second half of this century" to "by or around mid-century" this past weekend will console some critics. But it remains a dilemma that countries could not agree on a specific date with Russia and China only setting a 2060 target, when many countries were willing to aim for 2050, including coal-dependent South Africa. 

India’s Prime minister Narendra Modi only pledged net zero emissions by 2070, when he spoke at the world leaders’ summit in Glasgow on Monday. India has traditionally been loath to commit to a net-zero commitment, despite months of pressure, one of the last remaining major economies that had held out on this. 

'Drops in a rapidly warming ocean'

The G20 host, Italian Prime Minister Mario Draghi, tried to salvage some hope from the weekend, commenting that at least nations were closer to reaching the goal of providing $100bn a year in climate financing to developing countries.

Still, delegates at the talks in Glasgow had hoped for more. 

António Guterres, the UN's secretary-general, tweeted that he was leaving Rome with his "hopes unfulfilled" but not buried.

Prime minister of COP26’s host nation Boris Johnson said leaders' promises without action were "starting to sound hollow".

"These commitments... are drops in a rapidly warming ocean," he said.

Mohammed Nasheed, former president of the Maldives who serves as the ambassador of climate-vulnerable countries, said the statement didn’t go nearly far enough.

"This is a welcome start, but it won't stop the climate from heating more than 1.5 degrees," he said.

Mohamed Adow, director of NGO Power Shift Africa, said the watered-down statement was a result of developing countries being “shut out of the room".


Rich countries have broken their promise to aid vulnerable countries, but all is not lost

Developed countries must make more progress if a $100bn a year climate finance commitment, struck 12 years ago, will be honoured. 

The Climate Finance Delivery Plan released last week found that promises around climate funding made by rich countries have been broken. 

In 2009 at the Copenhagen climate summit developed countries pledged at least $100bn a year from both public and private sector sources to the developing world by 2020. 

The report found a shortfall in mobilising the promised climate finance by that date, and puts forward a plan to get the necessary finance needed by 2025. The current pledge era stretches to 2025, whereafter a new, higher figure will kick in. 

If the current promises are to be met, the report recommended that developed countries should jointly marshall $1.3tn per year by 2030, of which 50% should go towards mitigating climate change and 50% towards adapting to climate change.

The report, ahead of the UN’s COP26 climate talks that started in Glasgow on Sunday, sparked a debate around how rich countries could do more to help poorer countries tackle a climate crisis that is not of their making.

These funds could be applied to cut greenhouse gas emissions and cope with the impacts of the climate crisis. The report confirmed that climate finance plays a critical role in supporting developing countries to address climate change.

John Nordbo, senior climate advisor with aid group CARE International, said it was “shameful” that rich countries are only now owning up to the shortfall - a week before COP26 - when they made these promises 12 years ago.

The unfulfilled promises, critics say, have endangered developing nations’ trust in the landmark Paris climate deal.

Alok Sharma, the senior British official who will preside over COP26, admitted that rich countries' failure to meet the promises was "a source of deep frustration" among developing countries.

Climate finance will cost an estimated $500bn over five years, according to the report, to properly tackle the climate crisis and help countries adhere to the 1.5-degree target as envisioned by the Paris agreement, according to the report.

Analysts expect the focus to shift back to climate finance this year, and the pledges the developed world had made. 

Up to now, middle-income countries have received the lion’s share of available climate finance. Investors were drawn to their established markets, where renewable energy could easily turn a profit. 

Impoverished countries with their infrastructure challenges have been the poor cousins of the climate finance world, something the report says has to change for a global climate transition to succeed. COP26 will have to make this a focus area, Sharma said. 

The report, compiled by the German and Canadian governments at the request of the presidency of COP26, proposes a Climate Finance Delivery Plan. This plan outlines a path to achieving an average of $100bn per year for the period 2021-2025. It is based on statistics from the Organisation for Economic Co-operation and Development (OECD).

Sharma hoped the delivery plan would "restore trust" between richer and poorer governments.

Jochen Flasbarth, state secretary at Germany's environment ministry, wrote in the introduction of the report that "a lot of work remains" to make good on the climate finance pledge by 2025. 


COP26: A guide to the what’s what and who’s who at the talks

What exactly is the Paris Agreement, and why are developing countries asking for financing? Read on for everything you need to know at one of the most important global climate talks yet. 

1. What is COP26?
For the past 27 years, the nations of the world have convened to discuss ways to cut greenhouse gasses to reduce climate change. It is a painstaking process and fiendishly complex. The 26th session of the Conference of the Parties to the United Nations Framework Convention on Climate Change, better known as COP26 will be held in Glasgow, Scotland from October 31 until November 12, and aims to bring about radical climate action aligned with the Paris Agreement. About 25,000 people are expected to attend the conference, and it is hosted by the UK this year. 

2. What does COP26 want to achieve?
This year’s talks are expected to be the most ambitious meeting yet, with negotiations expected to call for drastic measures from the different countries in attendance to curb emissions and achieve net-zero by 2050. The negotiators revolve around ways to cut greenhouses so that temperature rise can be kept under 1.5°C to halt a runaway climate crisis. But to achieve that the world would need to halve its emissions. Getting nations to commit to emission targets will be a big focus of the UK presidency. But three other areas are expected to dominate talks at COP26; namely:

  1. Climate finance,
  2. Phasing out coal, and
  3. Nature-based solutions.

Developing countries will press for more financial aid to both adapt to and mitigate climate change, and climate finance is expected to dominate discussions. 

3. How will climate change affect Africa?
Climate change will have a significant impact on African countries and the lives and livelihoods of Africans. Africa will be particularly affected given its lack of financial resources, technical capacity and infrastructure. Many Africans rely on ecosystem goods for livelihoods and the continent has less well developed agricultural production systems than more developed countries. At the moment over 80% of Africa’s emissions are produced by its 10 most developed countries, with South Africa leading the pack.

4. Why can’t nations just agree to cut emissions?
It is all about money. Developed nations such as the United States, Canada, the European nations, Japan and Australia grew their economies largely as a result of burning fossil fuels to power their economies during the past 100 years. It left the planet with its current carbon crisis. Yet economies such as  India and Brazil have grown considerably and especially China’s competitive economy in recent years have created tension within the negotiations. Rich nations do not want to cut their emissions and hamper their economies if China is not compelled to do so as well. South Africa as the world 8th biggest emitter per capita is also in the spotlight because as a developing country it can’t afford to limit its economic growth. 

5. What is the Paris Agreement and why is it so important?
The landmark Paris agreement, signed in 2015 by 196 parties saw nations committing to holding global temperature rises to “well below” 2C above pre-industrial levels, while “pursuing efforts” to limit heating to 1.5C. The goals are legally binding in the treaty.

The agreement is important as it compels countries to take climate action in order to keep global average temperatures in check. Unfortunately, the Paris Agreement could not convince countries to submit legally enforceable targets for cutting their emissions by 2030, leaving countries to submit non-binding national targets.

Yet these national targets – known as nationally determined contributions, or NDCs – are the soul of the Paris Agreement. The biggest concern is that the pledges made do not go far enough, and every year the climate talks urge nations to do more. NDCs are updated every five years and also represent each country’s efforts to maintain a global average temperature of no more than 1.5°C. Countries had to update their efforts at the end of last year, but the pandemic slowed this down. 

6. What are South Africa’s latest NDCs that it has committed to?
South Africa recently updated its NDCs this year, committing to a target of between 350 to 420 metric tons of carbon dioxide equivalent for 2025 and 2030, through adaptation and mitigation means. The country’s new NDC shows the country’s ambition as the 350Mt CO2-eq is in line with the Paris Agreement’s 1.5°C target. This places South Africa ahead of the curve, turning the nation into a global leader in tackling climate change.

7. Why is climate change an opportunity for South Africa?
South Africa’s economy is coal-dependent, with more than 90% of its electricity generated by its power utility Eskom’s coal plants. But the state-owned enterprise is facing a financial crisis, while its ageing fleet is struggling to keep South Africa’s lights on. At the same time, South Africa’s transport sector is also a huge emitter that desperately needs clean fuel. The essence is that South Africa’s dirty economy has to transform if the country is to meet its NDCs.

And herein lies the opportunity. Eskom has to replace its ageing fleet, and replacing it with green technology is essential. At the same time, investors in rich countries are looking to invest in green projects that deliver the necessary carbon offsets they need. And so the match is made, and COP26 presents a great opportunity for South Africa to connect with such investors.

At the same time, South Africa’s investment into green fuels such as its green hydrogen project presents a huge money-making opportunity for investors looking to put their money into the “oil of the future".

Read more about this in our previous explainer here

8. But why would investors be attracted to South Africa in the wake of its economic challenges?
South Africa’s abundance of sunshine and wind makes it an ideal destination for investment in renewable energy. Even more crucial is that it draws investors looking to cash in on the rewards promised if you finance clean technologies in coal-dependent countries. This makes South Africa is a dream destination with its industrialised economy that promises a good return. In other words, South Africa is an excellent haven to spend funds destined for a climate transition, because its climate transition promises to be a success story. 

9. Why is climate finance expected to take centre stage at the negotiations?
​​Climate finance must provide funds to poor countries, from public and private sources, to help them cut emissions and cope with the impacts of extreme weather. African countries especially are concerned that climate finance promises have not been met, and are looking for reassurances that they will receive the necessary financial support.

Back in 2009 at COP15 in Copenhagen Cop, poor countries were promised $100 billion a year by 2020. But reports show that the promise was broken and that only $80 billion was provided last year. Developing countries also want pledges that the climate fund will grow as the years tick by. At the last climate talks in Madrid two years ago, climate finance was one of the reasons for the breakdown of talks.

10. Why is it all about the money?
If developing countries significantly cut their emissions, it would curb their growth because they would be unable to power their economy sufficiently. To move away from fossil fuels to clean technologies costs money, and the developed world has negotiated hard for financial aid in the past to move to a green-powered economy. This year climate financing is again expected to dominate negotiations. Developing countries argue that the 20 richest countries contribute up to 80% of global emissions, but that developing countries are most vulnerable even though they emit the least greenhouse gasses. 

11. Why is COP26 an opportunity for Africa to secure development funding?
Investors are eager to search for new opportunities in the green sphere, and with Africa being energy-constrained, huge opportunities exist to invest in new clean technologies and green infrastructure. Apart from climate finance from both the public and private sphere that will help Africa with its energy transition, investors at COP26 will be examining money-making opportunities in new emerging markets eager for green financing.  

12. Why is the focus on greenhouse emissions?
The Intergovernmental Panel on Climate Change, comprising esteemed scientists tasked to study the effects of climate change, has concluded that there is no longer any doubt that climate change is real. Their reports suggest that this change is caused by human activities — primarily the burning of fossil fuels and land-based activities such as deforestation. The change will ultimately lead to extreme weather, the changing of rain patterns, melting of glaciers and rising sea levels.

13. Who are the negotiating groups at the talks?
Here at the major groups: some are powerful negotiating blocks that have managed to make or break climate talks. 

  • G77 and China: Developing country parties generally work through the Group of 77 to establish common negotiating positions. This big negotiating group is a loose coalition of developing nations, designed to promote its members’ collective economic interests and create an enhanced joint negotiating capacity in the United Nation. But its interests, as it relates to climate change, are so diverse that it sometimes seems cohesion within the group is impossible. It includes countries such as the small island states that are threatened with flooding because of climate change, Saudi Arabia, which will lose income if the use of fossil fuels is reduced, Brazil and China, which are dependent on fossil fuels to grow their economies, and wealthy states such South Korea.
  • The African Group of Negotiators (African Group): This group puts forward Africa’s position, especially on mitigation issues, and will be a strong voice to shape negotiations. It comprises 54 Parties and is active in all aspects of the climate change negotiating process, for example, vulnerability, mitigation and adaptation to climate change.
  • The Umbrella Group: This group is often seen as an obstacle to negotiations. It is a loose coalition of non-European Union (EU) developed countries that formed after the adoption of the Kyoto Protocol in 1997. Although there is no formal list, the group is generally made up of Australia, Canada, Iceland, Japan, New Zealand, Norway, the Russian Federation, Ukraine and the United States (though the US is not as active as the others in the coalition). They are frequently under fire from non-governmental organisations for stalling negotiations.
  • Basic: Made up of Brazil, South Africa, India and China, Basic rose to prominence at the Copenhagen negotiations and speaks for the more “developed” developing countries that are under pressure from the US and the Umbrella Group to cap their emissions dramatically. Power plays between members however has lessened the influence of this potential strong negotiating group. 
  • Least Developed Countries: These 48 Parties defined as Least Developed Countries by the UN regularly work together in the wider UN system. They have become increasingly active in the climate change process, often working together to defend their particular interests, for example with regard to vulnerability and adaptation to climate change. Previously there were 49 Parties in the LDCs Group. However, in 2014 Samoa became too developed to fit into the LDCs circle.
  • The Small Island Developing States (SIDS): SIDS is a coalition of some 40 low-lying islands, most of which are members of the G-77 that are particularly vulnerable to sea-level rise. SIDS Parties are united by the threat that climate change poses to their survival and frequently adopt a common stance in negotiations. They were the first to propose a draft text during the Kyoto Protocol negotiations calling for cuts in carbon dioxide emissions of 20% from 1990 levels by 2005.

Pressure mounts on G20 summit to kickstart climate talks 

 The world’s 20 biggest economies are meeting this weekend in Italy amidst calls that they should do more to strengthen the fight against runaway climate change. #G20summit #COP26 

Climate change and its cost will be top of mind when wealthy nation leaders meet this weekend. Expectations are high that the meeting could inject the necessary momentum into the climate deal-making process. 

The Group of 20 (G20) — which comprises 19 individual nations and the European Union members - convene in Rome, Italy for the G20 summit, followed directly by UN climate talks in Glasgow, that will stretch into the middle of November. Experts agree that G20 nations' buy-in at COP26 in Glasgow is crucial, as the nations could make or break the talks.

It is the world's 20 biggest economies' first face-to-face meeting in two years, and many of the leaders will immediately depart to Scotland for the critical climate summit.

South Africa’s International Relations and Cooperation minister Naledi Pandor will lead the South African delegation. US president Joe Biden will be there. The presidents of China and Russia will not attend in person, but follow events remotely. Saudi Arabia will skip the summit. 

There are still huge divisions in the G20 group on how to phase out coal, and how much money to pledge to help poor nations meet their climate obligations. This weekend’s meeting is tasked with overcoming these challenges. 

Leaders at this week's summit face pressure to offer real action and formulate tangible steps that will keep the earth’s warming under 1.5 degrees. The G20 is made-up of the world’s major economies, many of which helped fuel climate change over the past century, through greenhouse gas emissions during their industrialisation drive.

 The G20 accounts for more than 80% of the world's gross domestic product, 60% of its population and an estimated 80% of global greenhouse gas emissions.

Despite its strength, countries in the group are still failing to do their part to adequately tackle emissions, a United Nations report found this week. The United Nations’ emissions gap report showed how the G20 collectively are not on track to meet the emissions-cutting pledges they made as part of the Paris Agreement. 

Given that developed nations account for roughly three-quarters of global greenhouse gas emissions, their failures to set bold targets or to fully meet existing goals are a significant reason the world remains on a path toward worsening climate catastrophes, the UN report found.

Some key entities, such as the United States, Canada and the European Union, have outlined new, stronger climate plans. If implemented, these would result in sharp cuts to emissions in those nations by the end of this decade. Other large emitters, such as China and India, have not yet formally submitted new plans though they have committed domestically to curbing climate change. 

Apart from doing more to cut emissions, a huge sticking point is the need for rich nations to honour a 2009 pledge to provide climate finance of $100 billion per year. Despite falling short of this pledge expectations are high that the G20 summit could urge rich nations to provide more to fill the funding gap. 

"The time has passed for diplomatic niceties," UN. Secretary-General Antonio Guterres said last week. "If governments, especially G20 governments, do not stand up and lead this effort, we are headed for terrible human suffering."

The South African Department of International Relations and Cooperation ministry’s spokesperson Clayson Monyela said South Africa will look for the reaffirmation of previous commitments made by the G20 relating to supporting Africa’s industrialisation

“South Africa will advocate for equal treatment of the climate in terms of mitigation, adaptation and means of implementation, including financing and technology transfer.”

 


Climate change may be just the saviour for SA's Eskom

Out of the coal ashes of a dying Eskom, a new green, clean and leaner power utility could rise as the world looks to South Africa to set an example of how a coal-dependent economy can reinvent itself.

Coal is fast becoming the pariah of the world and there are valid concerns that South Africa’s carbon-intensive economy will scare off investors. South Africa emits roughly half the total carbon emitted by the African continent, and Eskom emits about 44% of the total South African carbon emissions.

Because Eskom produces two-fifths of South Africa's greenhouse gases, it is at the centre of any plans the country has to transition to a green economy. Eskom this year has decided to flip the script, and attract new investors with the promise of new clean energy - a plan that could prove to be a money-spinner.  

South Africa, with Eskom taking the lead, has worked hard on its Just Energy Transition Transaction (JETT) to achieve this. JETT will play a critical role at the UN’s climate talks in COP26 as South Africa woos investors to finance its climate transition.

Cost of shedding South Africa's coal dependency

On its own, the financially addled Eskom is doomed. Straining under debt, it has no fiscal capacity to borrow the money it needs to ensure a smooth transition and reach its own goal of becoming carbon neutral by 2050. Eskom’s debt level is currently at over USD 27-billion.

Eskom agrees that a coal-to-renewables transition is necessary, but by its own calculations, the transformation could cost as much as $10-billion (or R146-billion). 

Mandy Rambharos, general manager at Eskom’s Just Energy Transition office, explained that the transition is not a cheap expenditure back in June when the $10-billion was first floated to investors.

"It’s a lot of money, so what we are putting on the table is to say to funders: South Africa can offer you the biggest source of carbon emissions reduction in the world.”

She said it is possible to collectively reinvent and reimagine a future for South Africa, once again built on electricity, but this time based on clean and green energy.

Misery breeds opportunities

Eskom CEO De Ruyter, who started at the power-utility in 2020, is a strong believer that Eskom’s misery has to a large extent bred a new opportunity.

In a number of talks and interviews over the past three months, he has repeatedly made the point that Eskom as the largest electricity producer, was becoming “a desirable counterpart” for developmental finance institutions and lenders as it moved away from new coal-fired projects towards renewable and less carbon-intensive generation.

He believed investors could also be attracted to the fact that they were dealing with a single entity, rather than with multiple partners to achieve a meaningful reduction in carbon emissions.

De Ruyter, who left South Africa for COP26 on Monday, commented just before he departed that improving the state of renewables in South Africa could free up R3-billion which Eskom would otherwise spend on responding to emissions. He said South Africa needs 4000 - 6000 MW of capacity on the grid to support its economic growth needs.

Turning dirty dinosaurs into lean green machines

De Ruyter added the albatross that was Eskom’s ageing generation fleet was actually an opportunity because the utility needed new investment for new power plants, and these plants will have to produce renewable energy.

“Many power plants are reaching the middle or even the end of their respective lives,” he said. 

According to De Ruyter, in an interview with The Conversation, Eskom’s fleet of coal-fired power stations, excluding Medupi and Kusile, are on average 41 years old, and have been run far harder than international norms, and have not been maintained as they should have been. 

Eskom plans to shut down between 8 000 MW and 12 000 MW of coal-fired power plants over the next decade. By 2035 Eskom’s plans to have shed 22 GW of its coal-fired capacity. This is roughly half of the total installed capacity that Eskom currently has.

Yet De Ruyter believed that this made economic sense: operating unreliable, costly power stations requiring billions of rands to meet emissions standards, was just plain bad business.

Instead, he said, renewable energy could deliver a range of benefits such as cost competitiveness, reduced emissions and possible job creation. He believed the switch could create up to 300,000 jobs in a new green economy - if done right. 

Transform or pay the price

As De Ruyter puts it, while the temptation existed to demand that the developed world should decarbonise, and allow developing nations such as South Africa to still fuel its growth with coal, this is a bad idea because of South Africa’s huge carbon footprint. 

“Our economy, on a per capita basis, is 25% more carbon-intensive than China, and double the global average. South Africa emits roughly half the total carbon emitted by the African continent, and Eskom emits about 44% of the total South African carbon emissions. We, therefore, cannot ignore our carbon footprint.” 

“It is becoming virtually impossible to secure funding for new coal generation projects, and insurance companies are targeting large carbon emitters with punitive premiums, or outright refusal to cover, as they seek to address the root cause of increased claims caused by climate change,” he said.

Investment in renewables will require new money and Eskom will need to borrow this or find investors. “These investments are inevitable and will have to be made regardless... Investors need a decent return on investment while assuming an appropriate degree of risk, just as any investor would do when building a factory.” 

But the investment could be a win-win solution if structured correctly. “Investors get their return — which increases the tax pool for the government — and the country regains energy security and grows job opportunities. It’s a no-brainer.”