New global climate deal struck at conference in Egypt

Climate reparations, or “loss and damage” funding, is a highly divisive and emotive issue that is seen as a fundamental question of climate justice.

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Government ministers and negotiators from nearly 200 countries finally secured an agreement Sunday aimed at keeping a critically important global heating target alive.

The new political deal reaffirms efforts to limit global temperature rise to the crucial temperature threshold of 1.5 degrees Celsius above pre-industrial levels and the creation of a new “loss and damage” fund that would compensate poor nations that are victims of extreme weather worsened by climate change.

The two-week-long COP27 climate summit took place in Egypt’s Red Sea resort town of Sharm el-Sheikh against a backdrop of increasing extreme weather events, geopolitical conflicts and a deepening energy crisis.

Delegates struggled to build consensus on an array of issues, even as a flurry of U.N. reports published ahead of the conference made clear just how close the planet is to irreversible climate breakdown.

The scale of division between climate envoys saw talks run beyond Friday’s deadline, with campaigners accusing the U.S. of playing a “deeply obstructive” role by blocking the demands of developing countries. The final agreement was reached in the early hours of Sunday morning following tense negotiations throughout the night, with many delegates exhausted by the time the deal was announced.

Some of the major sticking points included battles over whether all fossil fuels or just coal should be named in the decision text and whether to set up a “loss and damage” fund for countries hit by climate-fueled disasters.

The highly divisive and emotive issue of loss and damage dominated the U.N.-brokered talks and many felt the success of the conference hinged on getting wealthy countries to agree to establish a new fund.

The summit made history as the first to see the topic of loss and damage funding formally make it onto the COP27 agenda. The issue was first raised by climate-vulnerable countries 30 years ago.

Lifting hopes of a breakthrough on loss and damage thereafter, the European Union said late Thursday that it would be prepared to back the demand of the G-77 group of 134 developing nations to create a new reparations fund.

The proposal was welcomed by some countries in the Global South, although campaigners decried the offer as a “poison pill” given the bloc said it was only willing to provide aid to “the most vulnerable countries.”

Rich countries have long opposed the creation of a fund to address loss and damage and many policymakers fear that accepting liability could trigger a wave of lawsuits by countries on the frontlines of the climate emergency.

The ‘world’s largest floating wind farm’ produces its first power

Offices of Equinor photographed in Feb. 2019. Equinor is one of several companies looking at developing floating wind farms.

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A facility described as the world’s largest floating wind farm produced its first power over the weekend, with more turbines set to come online before the year is out.

In a statement Monday, Norwegian energy firm Equinor — better known for its work in the oil and gas industry — said power production from Hywind Tampen’s first wind turbine took place on Sunday afternoon.

While wind is a renewable energy source, Hywind Tampen will be used to help power operations at oil and gas fields in the North Sea. Equinor said Hywind Tampen’s first power was sent to the Gullfaks oil and gas field.

“I am proud that we have now started production at Hywind Tampen, Norway’s first and the world’s largest floating wind farm,” Geir Tungesvik, Equinor’s executive vice president for projects, drilling and procurement, said.

“This is a unique project, the first wind farm in the world powering producing oil and gas installations.”

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Hywind Tampen is located around 140 kilometers (86.9 miles) off the coast of Norway, in depths ranging from 260 to 300 meters.

Seven of the wind farm’s turbines are slated to come on stream in 2022, with installation of the remaining four taking place in 2023. When complete, Equinor says it will have a system capacity of 88 megawatts.

Alongside Equinor, the other companies involved in the project are Vår Energi, INPEX Idemitsu, Petoro, Wintershall Dea and OMV.

Equinor said Hywind Tampen was expected to meet around 35% of the Gullfaks and Snorre fields’ electricity demand. “This will cut CO2 emissions from the fields by about 200,000 tonnes per year,” the company added.

The use of a floating wind farm to help power the production of fossil fuels is likely to spark some controversy, however.

Fossil fuels’ effect on the environment is considerable and the United Nations says that, since the 19th century, “human activities have been the main driver of climate change, primarily due to burning fossil fuels like coal, oil and gas.”

Speaking at the COP27 climate change summit in Sharm el-Sheikh, Egypt, last week, the U.N. Secretary General issued a stark warning to attendees.

“We are in the fight of our lives, and we are losing,” Antonio Guterres said. “Greenhouse gas emissions keep growing, global temperatures keep rising, and our planet is fast approaching tipping points that will make climate chaos irreversible.”

An emerging industry

Equinor said the turbines at Hywind Tampen were installed on a floating concrete structure, with a joint mooring system. One advantage of floating turbines is that they can be installed in deeper waters than fixed-bottom ones.

Back in 2017, Equinor started operations at Hywind Scotland, a five-turbine, 30 MW facility it calls the world’s first floating wind farm.

Since then, a number of major companies have made moves in the sector.

In Aug. 2021, RWE Renewables and Kansai Electric Power signed an agreement to assess the feasibility of a “large-scale floating offshore wind project” in waters off Japan’s coast.

In Sept. of that year, Norwegian company Statkraft announced a long-term purchasing agreement relating to a 50 MW floating wind farm — which it has also dubbed the “world’s largest” — off the coast of Aberdeen, Scotland.

And a few months later, in Dec. 2021, plans for three major offshore wind developments in Australia — two of which are looking to incorporate floating wind tech — were announced.

Earlier this year, meanwhile, the White House said it was targeting 15 gigawatts of floating offshore wind capacity by the year 2035.

“The Biden-Harris Administration is launching coordinated actions to develop new floating offshore wind platforms, an emerging clean energy technology that will help the United States lead on offshore wind,” a statement, which was also published by U.S. Department of the Interior, said at the time.

As well as the 15 GW ambition, a “Floating Offshore Wind Shot” aims to reduce the costs of floating technologies by over 70% by the year 2035.

“Bringing floating offshore wind technology to scale will unlock new opportunities for offshore wind power off the coasts of California and Oregon, in the Gulf of Maine, and beyond,” the statement added.

How wind power is leading America's energy transition

‘We are not acting swiftly enough’: Ex-Obama advisor on COP27

We are not acting swiftly enough on climate change, former Obama advisor says

The COP27 climate conference represents an opportunity to move forward, but a significant ramping up of efforts will be required in the years ahead, according to a former special assistant to President Barack Obama.

Speaking at CNBC’s Sustainable Future Forum last week, Alice Hill was asked if she was optimistic or very concerned about the pace of change.  

“Very concerned — we are not acting swiftly enough, and the impacts and the danger [are] … overtaking our efforts,” Hill, who is now a senior energy fellow at the Council on Foreign Relations, told CNBC’s Steve Sedgwick.

COP27, which is being held in Sharm el-Sheikh, Egypt, is taking place at a time of significant global volatility. War, economic challenges and the Covid-19 pandemic are all casting long shadows over its proceedings.

During her interview with CNBC, it was put to Hill that climate change often slipped down the pecking order compared to other global challenges and events.

It was a viewpoint she seemed to align with. “Climate change has suffered from the problem that I learned in the White House,” she said.

“When I worked in the White House, [it] quickly became apparent that the urgent would overtake the important,” she added. “Of course, climate change is now urgent.”

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Despite this urgency, she noted that the war in Ukraine, tensions between the U.S. and China and other geopolitical strains were tending to “overshadow the need to work on and continue to drive progress towards addressing climate change.”

This had, she argued, “really been the state of play since scientists first raised these alarms decades ago.”

There is a significant amount riding on the negotiations taking place in Egypt.

On Monday, the United Nations secretary general issued a stark warning, telling attendees at COP27 that the world was losing its fight against climate change. “We are in the fight of our lives, and we are losing,” Antonio Guterres said.

At the Sustainable Future Forum, Hill was asked about the best scenario she could realistically see coming out of COP27.

“That we have further progress on the methane pledge,” she said, in an apparent reference to the commitment on cutting methane emissions made at COP26 last year.

Her other hopes for COP27 included getting “serious commitments, or improvements in commitments” when it came to financing for the developing world; and better addressing the issue of loss and damage.  

Despite the above, Hill ended on a note of caution.

There were “a lot of opportunities for really significant steps forward,” she said, “but I’m afraid this COP won’t offer us that kind of transformational leap forward that this problem cries out for — and deserves — in order to keep the globe safe.”

Taxation is a blunt instrument, IATA chief Willie Walsh says

IATA: Environmental taxes are a 'blunt instrument' to provide a sustainable footprint in aviation

The aviation industry requires more carrot and less stick going forward to become more sustainable, according to the director general of the International Air Transport Association.

Speaking at CNBC’s Sustainable Future Forum on Friday, Willie Walsh was asked if subsidies and tax breaks to encourage investments into cleaner energy were more effective than firms or consumers being taxed for emitting higher levels of carbon.

“Quite honestly, all of the evidence that we have available shows that the carrot is far more effective than the stick,” Walsh replied.

Expanding on his point, Walsh went on to describe taxation as being “a very blunt instrument — in many cases, actually, it would make our industry less efficient.”

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“I don’t think it would stop the number of planes flying, it would definitely reduce the number of people flying on the planes,” he added. “And that would be a silly thing to do.”

“What we need to do is to ensure that our planes are more full rather than less full, and to provide incentives to produce sustainable aviation fuels which will make a genuine impact on the environmental footprint of aviation.”

The European Union is currently looking to revise its energy taxation directive. Among other things, this would see both maritime and aviation fuels taxed. 

Net-zero goals

In Oct. 2021, IATA member airlines passed a resolution “committing them to achieving net-zero carbon emissions from their operations by 2050.”

Given the fact it’s a crucial cog in the global economy, conversations about aviation and its effect on the environment will undoubtedly take place at the COP27 climate change conference being held in Sharm el-Sheikh, Egypt.

This is because despite its importance, aviation has been described by the World Wildlife Fund as “one of the fastest-growing sources of the greenhouse gas emissions driving global climate change.”

The WWF also says air travel is “currently the most carbon intensive activity an individual can make.”

During his appearance at the Sustainable Future Forum, IATA’s Walsh was asked how difficult it was for the airline industry to decarbonize compared to others.

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“It’s very difficult … we account for about 2.4% of manmade CO2 today,” he said.

“We recognise however, as other industries decarbonize — and for many of them there are relatively simple pathways to decarbonization — our contribution will increase, because we will continue to be dependent on kerosene to power our aircraft,” he added.

“Now, technology will provide some solutions but … we’re not prepared to depend on something being developed in the future, we recognize we have to do something now.”

“So for us, the key to our goal is the use of sustainable aviation fuels — the science there is proven.”

“What we’ve got to do is turn what is very low levels of production of sustainable fuels into widespread availability.”

This, Walsh argued, represented a real opportunity not only for the industry but “countries around the world to start producing a sustainable jet fuel.”

Such a move would “address the environmental issues but … also create jobs.”

Gatherings like COP27 'are hugely important,' aviation CEO says

The overarching idea behind sustainable aviation fuels is that they can be used to reduce an aircraft’s emissions.

In terms of content, aircraft maker Airbus has described SAF as being “made from renewable raw material.” It’s stated that the most common feedstocks “are crops based or used cooking oil and animal fat.”

There are major concerns in some quarters that an increased uptake of SAF could, among other things, result in significant deforestation and create a squeeze on crops crucial to the production of food, an issue Walsh touched upon earlier this year.

Back at the Sustainable Future Forum, Walsh struck an optimistic tone about his sector’s prospects going forward, whilst acknowledging that work lay ahead.

“I think the fact that we are committed to net zero by 2050 is important, but demonstrating that we have a credible pathway to … net zero is equally important,” he said.

“And people are beginning to recognize that through sustainable aviation fuels and other initiatives … we can achieve that clear goal.”

COP27 opens with a rallying call for rich nations to pay up

The COP27 summit sees delegates from nearly 200 countries gather in Egypt’s Red Sea resort town of Sharm el-Sheikh for talks on how to address the climate crisis.

Sean Gallup | Getty Images News | Getty Images

SHARM EL-SHEIKH, Egypt — Top officials kicked off proceedings at the U.N.’s flagship climate conference by urging wealthy countries to finally fix their broken $100 billion promise, while the hot-button issue of reparations was adopted onto the official agenda for the first time.

The COP27 summit, which formally opened on Sunday, sees delegates from nearly 200 countries gather in Egypt’s Red Sea resort town of Sharm el-Sheikh for talks on how to address the climate crisis.

Climate finance, as it has done since the first U.N. climate conference in 1995, will once again play a pivotal role.

IMF: Rich countries and public money will 'never close' the climate financing gap

It follows a series of mind-bending extreme weather events worldwide. For instance, in just the last few months, one-third of Pakistan was completely submerged by historic flooding, Nigeria recorded its worst floods in a decade and China suffered its most intense and sustained heatwave on record.

“I fully recognize the scale of the challenge still in front of us,” Alok Sharma, a U.K. lawmaker and president of last year’s COP26, said Sunday as he addressed attendees at the U.N.-brokered talks.

“We are not currently on a pathway that keeps 1.5 in reach. And whilst I do understand that leaders around the world have faced competing priorities this year, we must be clear; as challenging as our current moment is, inaction is myopic and can only defer climate catastrophe,” Sharma said.

“We must find the ability to focus on more than one thing at once. How many more wake-up calls do world leaders actually need?”

“We must find the ability to focus on more than one thing at once. How many more wake-up calls do world leaders actually need?” Sharma said at the opening ceremony of COP27.

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The 1.5 degrees Celsius limit is the aspirational temperature threshold ascribed in the landmark 2015 Paris Agreement. It is recognized as a crucial global target because beyond this level, so-called tipping points become more likely. These are thresholds at which small changes can lead to dramatic shifts in the Earth’s entire life support system.

“I will do everything in my power to support our Egyptian friends and the U.K. is here to reach ambitious outcomes across the agenda, including on mitigation, adaptation and loss and damage,” Sharma said on handing the COP presidency over to Egypt’s Sameh Shoukry.

“We know we have reached a point where finance makes or breaks the program of work that we have ahead of us,” he added. “So, whilst I would point to some of the progress shown on the $100 billion, I hear the criticisms and I agree that more must be done by governments and the multilateral development banks.”

Loss and damage on the agenda for the first time

Countries from the Global South will be looking for reassurance in Egypt that the $100 billion climate finance pledge by rich nations in 2009 to help low-income nations mitigate and adapt to the climate emergency is finally going to be met.

“The current mobilization of efforts raises many concerns,” Egypt’s Shoukry said Sunday, according to a translation.

The 'energy crisis is also an opportunity,' president of COP27 and Egypt’s foreign minister says

“The $100 billion a year pledge has not yet been implemented. Also, the financing currently available focuses on curbing emissions, not adaptation efforts — [and] most of the financing is based on loans,” he continued.

Low-income countries, already burdened with debt, have repeatedly called for a move to grant-based finance as opposed to more loans.

“I believe that you agree with me when I say that we do not have the luxury of continuing in this way. We have to change our approach to this existential threat,” Shoukry added.

“I believe that you agree with me when I say that we do not have the luxury of continuing in this way. We have to change our approach to this existential threat,” Egypt’s Sameh Shoukry said.

Sean Gallup | Getty Images News | Getty Images

The push for this $100 billion finance pledge to be fulfilled comes amid broader calls for rich countries to compensate vulnerable nations as it becomes harder for many people to live safely on a warming planet.

Climate reparations, sometimes referred to as “loss and damage” payments, are widely expected to dominate the COP27 talks. These payments refer to the destructive impacts of the climate crisis that countries cannot defend against because the risks are either unavoidable or they cannot afford it.

Indeed, for the first time ever, the topic of loss and damage finance formally made it onto the COP27 agenda. The issue was first raised by climate-vulnerable countries 30 years ago.

“We do not want to be here, demanding finance for our loss and damage response,” a spokesperson said on behalf of the Alliance of Small Island States, a group of 39 small island and low-lying coastal developing nations largely from the Caribbean and South Pacific.

“We do not want to be treated as though you are doing us a favor by adding an agenda item or creating a voluntary fund,” they added.

“AOSIS is here to agree to the establishment of a new Loss and Damage Response Fund at COP27 that is operational by 2024. We are here, so that we can go back to our own homes, and not become climate-displaced people in yours.”

UN sees three critical lines of action

Shoukry’s comments follow a flurry of chastening reports from the U.N. and World Meteorological Organization in recent days.

The U.N. Environment Programme said late last month that there is “no credible pathway” in place to cap global heating at 1.5 degrees Celsius. A separate U.N. report warned the world is “nowhere near” hitting its targets to curb greenhouse gas emissions, with current plans estimated to see world temperatures rise by 2.5 degrees Celsius.

Meanwhile, the WMO said the amount of carbon dioxide, methane and nitrous oxide in the Earth’s atmosphere hit record highs last year. These are the three greenhouse gases responsible for trapping heat in the atmosphere and driving global heating.

U.N. Climate Change Executive Secretary Simon Stiell on Sunday urged climate envoys from around the globe to focus on three critical lines of action at COP27. He also doubled down on the need for high-income nations to financially support countries on the frontline of the climate emergency.

“First, we must demonstrate this transformational shift to implementation,” Stiell said. “Every corner of human activity must align with our Paris agreement of pursuing efforts to limit temperature rise to 1.5 degrees.”

“The second line of action, we must cement progress on these critical workstreams: Mitigation, adaptation, finance and – crucially – loss and damage,” Stiell said.

“Finally, a third line of action, we must enhance the delivery of the principles of transparency and accountability throughout the process.”

Loss and damage funding to dominate the talks

“Looking at loss and damage as a side issue is not acceptable because this is the reality that millions are facing every single day,” said Harjeet Singh, head of global political strategy at Climate Action Network.

Fida Hussain | Afp | Getty Images

The success or failure of the U.N.’s flagship climate conference is likely to depend on getting wealthy countries to deliver on reparations — a highly divisive and emotive issue that is seen as a fundamental question of climate justice.

The COP27 climate summit gets underway in Egypt from Nov. 6. The annual gathering of the U.N. Climate Change Conference will see more than 30,000 delegates convene in the Red Sea resort town of Sharm el-Sheikh to discuss collective action on the climate emergency.

It comes amid growing calls for rich countries to compensate climate-vulnerable nations as it becomes harder for many people to live safely on a warming planet.

Reparations, sometimes referred to as “loss and damage” payments, are likely to dominate proceedings at COP27, with diplomats from more than 130 countries expected to push for the creation of a dedicated loss and damage finance facility.

They argue agreement on this issue is imperative as climate impacts become more severe.

Rich countries, despite accounting for the bulk of historical greenhouse gas emissions, have long opposed the creation of a fund to address loss and damage. Many policymakers fear that accepting liability could trigger a wave of lawsuits by countries on the frontlines of the climate emergency.

If we lose the agenda fight then we might as well come home and forget about the rest of COP because it will be useless in the face of what is happening in the world on climate change.

Saleemul Huq

Director of ICCCAD

Saleemul Huq, director of the Bangladesh-based International Centre for Climate Change and Development, said he is expecting an “agenda fight” at the start of COP27 — the result of which he said will be critical to the summit’s integrity.

Finance to address loss and damage is on the provisional agenda for the U.N. climate conference. However, policymakers will need to determine whether to adopt it onto the official agenda at the start of the summit.

Huq, a pioneer of loss and damage research and advocacy, said it is feared that once again wealthy countries will refuse to endorse financial support for low- and middle-income countries acutely vulnerable to the climate crisis.

U.S. climate envoy John Kerry said Washington would not be “obstructing” talks on loss and damage in Sharm el-Sheikh.

Bloomberg | Bloomberg | Getty Images

For instance, at COP26 last year, high-income nations blocked a proposal for a loss and damage financing body, choosing instead to engage in a new three-year dialogue for funding discussions. The so-called “Glasgow Dialogue” has been sharply criticized as a program without a clear plan or an intended outcome.

Huq said during a webinar hosted by Carbon Brief that the battle to put loss and damage funding on the official agenda “is going to be the big fight coming up in Sharm el-Sheikh.”

“If we lose the agenda fight then we might as well come home and forget about the rest of COP because it will be useless in the face of what is happening in the world on climate change,” Huq said.

“It is beyond mitigation and adaptation now,” he added. “Loss and damage [funding] is by far the most important issue that needs to be discussed and if the UNFCCC doesn’t do it then it basically becomes redundant.”

‘The litmus test for the success of COP27’

Anglers fish on the River Sava in heavy smog conditions in Belgrade, Serbia, on Tuesday, Nov. 1, 2022. Smog spewing from ancient coal-fired power plants, outdated automobiles and heating systems running on burning tires and wood is choking the Balkans both literally and economically.

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Speaking two weeks ahead of COP27, U.S. climate envoy John Kerry said Washington would not be “obstructing” talks on loss and damage in Sharm el-Sheikh. His comments mean that, for the first time ever, the U.S. appears willing to discuss reparations at the U.N. climate conference.

Kerry’s openness to talks on loss and damage funding marked an abrupt change in tone from just one month earlier. Speaking at a New York Times event on Sept. 20, Kerry suggested the U.S. would not be prepared to compensate countries for the loss and damage they’ve suffered as a result of the climate emergency.

“You tell me the government in the world that has trillions of dollars — because that’s what it costs,” Kerry said. He added that he refused to feel “guilty” for the climate crisis.

“There’s plenty of time to be arguing, pointing fingers, doing whatever,” Kerry said. “But the money we need right now needs to go to adaptation, it needs to go to building resilience, it needs to go to the technology that is going to save the planet.”

A man inspects a devastated field in the village of Ramdaspur affected by Cyclone Sitrang in Bhola under Barishal, Division, Bangladesh on October 15, 2022.

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Advocates of loss and damage funding argue it is required to account for climate impacts — including hurricanes, floods and wildfires or slow-onset impacts such as rising sea levels — that countries cannot defend against because the risks are unavoidable or the countries cannot afford it.

“This is the litmus test for the success of COP27,” said Harjeet Singh, head of global political strategy at Climate Action Network, which includes more than 1,500 civil society groups.

“Looking at loss and damage as a side issue is not acceptable because this is the reality that millions are facing every single day,” Singh said during the same webinar event, citing devastating floods in Pakistan and severe droughts in the Horn of Africa.

Singh said political mobilization over loss and damage funding makes COP27 the most important COP yet. “We now have to make sure it delivers climate justice that we have been demanding by creating a new system of funding so that we can support people who are facing the climate emergency now.”

What is loss and damage?

There is no internationally agreed definition for loss and damage, but it is broadly understood to refer to the economic impacts on livelihoods and property, and non-economic loss and damage, such as the loss of life and losses to biodiversity.

“I think it means different things to different people, but broadly I would see the idea as funding to address the impacts of climate change that can’t be avoided through mitigation and adaptation,” Rachel James, a climate scientist at the University of Bristol, told CNBC via telephone.

“That ties into why it is so important for climate justice because we don’t have a mechanism or funding to deal with that at the moment — and it’s too late to ignore it.”

Degrowth: Is it time to live better with less?

Why does it matter?

“Loss and damage is happening every single day somewhere in the world — and it will continue to happen every single day from now on,” ICCCAD’s Huq said, citing the damage caused by Hurricane Ian in late September as a recent example.

“Ian is the biggest storm Florida has had so far. But that’s not going to be true next year, they are going to have a bigger one next year and they are going to one even bigger than that the year after. So, we have now entered the era of impacts from human-induced climate change causing losses and damages.”

“We need to deal with that — and we are not prepared to do it at all. Even the richest country in the world, the U.S., is not prepared for this,” he added.

Paddy McCully, senior analyst at non-governmental organization Reclaim Finance, said that although loss and damage funding was highly likely to feature prominently at COP27, nobody is expecting substantial progress.

“Given the geopolitical situation at the moment and the sharply different positions from the north and south on loss and damage, I think it is going to be hard for countries to achieve a dramatic breakthrough,” McCully told CNBC via telephone.

“The sign of a successful COP will be that there is at least agreement on a mechanism for providing finance in loss and damage,” he said. “And I think that a moderately successful COP would be that it doesn’t all fall apart in north-south acrimony, and you have at least agreement on further talks on setting up a mechanism.”

Electric vehicle (EV) sales set to hit an all-time high in 2022, IEA says

Tesla electric cars photographed in Germany on March 21, 2022. According to the International Energy Agency, electric vehicle sales are on course to hit an “all-time high” this year.

Sean Gallup | Getty Images News | Getty Images

Electric vehicle sales are on course to hit an all-time high this year, but more work is needed in other sectors to put the planet on course for net-zero emissions by 2050, according to the International Energy Agency.

In an announcement accompanying its Tracking Clean Energy Progress update, the IEA said there had been “encouraging signs of progress across a number of sectors” but cautioned that “stronger efforts” were required to put the world “on track to reach net zero emissions” by the middle of this century.

The TCEP, which is published yearly, looked at 55 parts of the energy system. Focusing on 2021, it analyzed these components’ progression when it came to hitting “key medium-term milestones by the end of this decade,” as laid out in the Paris-based organization’s net-zero pathway.

On the EV front, the IEA said global sales had doubled in 2021 to represent nearly 9% of the car market. Looking forward, 2022 was “expected to see another all-time high for electric vehicle sales, lifting them to 13% of total light duty vehicle sales globally.”

The IEA has previously stated that electric vehicle sales hit 6.6 million in 2021. In the first quarter of 2022, EV sales came to 2 million, a 75% increase compared to the first three months of 2021.

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The IEA said both EVs and lighting — where more than 50% of the worldwide market is now using LED tech — were “fully on track for their 2030 milestones” in its net-zero by 2050 scenario.

Despite the outlook for EVs, the IEA separately noted that they were “not yet a global phenomenon. Sales in developing and emerging countries have been slow due to higher purchase costs and a lack of charging infrastructure availability.”

Overall, the rest of the picture is a more challenging one. The IEA noted that 23 areas were “not on track” with a further 30 deemed as needing more effort.

“Areas not on track include improving the energy efficiency of building designs, developing clean and efficient district heating, phasing out coal-fired power generation, eliminating methane flaring, shifting aviation and shipping to cleaner fuels, and making cement, chemical and steel production cleaner,” the IEA said.

The shadow of 2015’s Paris Agreement looms large over the IEA’s report. Described by the United Nations as a “legally binding international treaty on climate change,” the accord aims to “limit global warming to well below 2, preferably to 1.5 degrees Celsius, compared to pre-industrial levels.”

Cutting human-made carbon dioxide emissions to net-zero by 2050 is seen as crucial when it comes to meeting the 1.5 degrees Celsius target.

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In a statement issued Thursday the IEA’s executive director, Fatih Birol, appeared cautiously optimistic. “There are more signs than ever that the new global energy economy is advancing strongly,” he said.

“This reaffirms my belief that today’s global energy crisis can be a turning point towards a cleaner, more affordable and more secure energy system,” he added.

“But this new IEA analysis shows the need for greater and sustained efforts across a range of technologies and sectors to ensure the world can meet its energy and climate goals.”

The IEA’s report comes at a time when the debate and discussion about climate goals and the future of energy has become increasingly fierce.

This week, the U.N. secretary general said developed economies should impose an extra tax on the profits of fossil fuel firms, with the funds diverted to countries affected by climate change and households struggling with the cost-of-living crisis.

In a wide-ranging address to the U.N. General Assembly in New York, Antonio Guterres described the fossil fuel industry as “feasting on hundreds of billions of dollars in subsidies and windfall profits while households’ budgets shrink and our planet burns.”

Increase in ‘unsafe’ aerial Chinese intercepts’: U.S. Navy

U.S. Navy P-8 Poseidon aircraft.

Nurphoto | Nurphoto | Getty Images

SINGAPORE — The commander of the U.S. Seventh Fleet said on Tuesday that he’s seen an increase in “unsafe” aerial intercepts by the Chinese military in the South China Sea region.

As recently as May, a Chinese fighter aircraft allegedly intercepted a Royal Australian Air Force P-8 maritime surveillance plane in the South China Sea region in a manner that Australia’s defense department said was “dangerous” to its aircraft and crew. The department said the Chinese aircraft fired chaff that was sucked into the Australian plane’s engine.

“This reported increase in the air is obviously concerning… it’s not a very forgiving environment if something goes wrong when you’re flying in the air,” Karl Thomas said.

The Chinese embassy in Singapore did not immediately respond to CNBC’s request for comment.

Thomas said in a press briefing in Singapore that keeping sea lanes open is the “first and foremost” mission of the U.S. Navy.

“Sea lanes are the lifeblood of our economies … having open sea lanes and having shipping that can operate … is extremely important to keep the economy running,” the vice admiral said.

About 80% of global trade volume was carried by sea in 2021, according to the United Nations Conference on Trade and Development.

The South China Sea holds some of the world’s busiest commercial shipping lanes. China claims sovereignty over almost the whole body of water, though other countries including the United States do not acknowledge that claim and it hasn’t held up in a court of international arbitration.

Dangerous intercepts remain ‘infrequent’

Thomas was careful to note that dangerous aerial intercepts remain rare.

“We’re not seeing it happen very frequently. It’s not like every day, something’s going on. It’s an infrequent action,” he said. “And then you start asking yourself — is it because it’s an unprofessional pilot? Or is it something that’s more broad than that?”

UN Secretary General urges governments to tax ‘immoral’ oil profits

United Nations Secretary General Antonio Guterres speaks during the 2022 Review Conference of the Parties to the Treaty on the Non-Proliferation of Nuclear Weapons at the United Nations in New York City on August 1, 2022.

Ed Jones | AFP | Getty Images

WASHINGTON — United Nations Secretary-General Antonio Guterres urged governments on Wednesday to tax excessive oil and gas profits as the world grapples with an energy crisis triggered in part, by Russia’s war in Ukraine.

“It is immoral for oil and gas companies to be making record profits from this energy crisis on the backs of the poorest people and communities,” Guterres said in a speech before the international forum.

He added that the funds, which equate to $100 billion in the first quarter of this year should instead be used to support vulnerable communities.

“This grotesque greed is punishing the poorest and most vulnerable people while destroying our only home,” Guterres said, calling for governments to also address the mounting climate crisis.

He also urged governments to ramp up and diversify supply chains for raw materials and renewable energy technologies while eliminating bureaucratic red tape around the energy transition.

“Every country is part of this energy crisis,” Guterres said.

He also said that the consequences of the Kremlin’s war have extended beyond a budding energy crisis and have also exacerbated global food insecurity and crippling debt around the world, but specifically in developing nations.

“Many developing countries drowning in debt, without access to finance and struggling to recover from the Covid-19 pandemic could go over the brink,” Guterres warned. “We are already seeing the warning signs of a wave of economic, social and political upheaval that would leave no country untouched,” he added.

The U.N. chief announced the establishment of the Global Crisis Response Group aimed at coordinating global solutions to the triple crisis of food, energy and finance.

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Guterres’ comments come as the first vessel carrying Ukrainian agricultural goods departs from the Black Sea, a significant step in addressing the mounting food crisis provoked by Russia’s naval blockade of Ukrainian ports sprinkled along the Sea of Azov and the Black Sea.

In July, representatives from the U.N., Turkey, Russia and Ukraine signed an agreement to reopen three Ukrainian ports, an apparent breakthrough as the Kremlin’s war on its ex-Soviet neighbor marched into its fifth month.

Less than 24 hours after the deal was signed though, Russian missiles rained down on Odesa, Ukraine’s largest port. World leaders swiftly condemned the Kremlin’s missile strike on Odesa, another anxious turn in fruitless efforts to mitigate a mounting global food crisis.

Ukraine’s infrastructure minister, Oleksandr Kubrakov, told NBC News on Monday that the vessel is expected to reach Tripoli, Lebanon in two days.

Kubrakov also said that 16 ships are ready to go, but that only three vessels will leave the port each day for the next two weeks. He added that in the next two months, Ukraine hopes to export up to 3 million tons of grain and other agricultural goods by sea per month.

Before Russia’s invasion, Ukraine exported 5 million to 7 million tons per month.

Russia and Ukraine sign deal to resume grain exports in Black Sea

Ukraine is one of the world’s top agricultural producers and exporters.

Bulent Kilic | AFP | Getty Images

Russia and Ukraine on Friday signed a U.N.-backed deal to resume exports of Ukrainian grain through the Black Sea.

The agreement, which will be implemented in the next few weeks, was signed in the Turkish city of Istanbul and was brokered by the government in Ankara.

Russian Defense Minister Sergei Shoigu was in attendance along with United Nations Secretary-General Antonio Guterres and Turkish President Recep Tayyip Erdogan. Russian and Ukrainian officials sat at separate tables to sign the documents.

Millions of tons of wheat have been stuck in the war-torn nation. Grain exporters in Ukrainian port cities like Odesa have been unable to ship their goods due to the conflict, fueling a global shortage of the commodity and pushing up food prices.

Ukraine is one of the world’s biggest wheat exporters, and Russian forces have been blocking the Black Sea, where the grain silos at key Ukrainian ports are located.

The Bosporus and Dardanelles are the only water routes in or out of the Black Sea. That gives Turkey influence over how Russia’s navy can move.

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The deal is significant for global food supplies, but also as it’s the first major agreement between the two sides since Moscow launched it’s unprovoked onslaught on Feb. 24.

‘Beacon of hope’

While the details of the deal are currently unknown, it was expected to allow Ukrainian vessels to guide ships through mined waters, with a localized truce in place so Russia does not attack. Turkish officials are also expected to inspect the shipments to rule out any weapons smuggling.

International onlookers are cautious on the deal and Russia will be closely watched to make sure it upholds its side of the agreement. Moscow, which blames Ukraine for laying the mines, is also expected to restart its own grain exports in the Black Sea under the agreement.

Erdogan said at the signing Friday that the deal would prevent billions of people from facing famine. He said he hoped the deal would be a turning point in the war and called on both sides to end the conflict.

“We are proud to be instrumental in an initiative that will play a major role in solving global food crisis that has been on the agenda for a long time,” Erdogan said, according to a translation.

Guterres struck an optimistic tone, saying there was now a beacon “on the Black Sea.” “A beacon of hope [and] possibility … and relief in a world that needs it more than ever.”

Ukraine is one of the world’s top agricultural producers and exporters. According to the United States Department of Agriculture, it is normally the world’s top producer of sunflower meal, oil and seed. it’s also the world’s top exporter of sunflower meal and oil, and the world’s seventh-largest wheat producer.

Top destinations for wheat exports include Egypt, Indonesia, Turkey, Pakistan and Bangladesh.

December futures prices for wheat on the Paris exchange slipped by around 5% after the deal was announced.

Turkish President Recep Tayyip Erdogan, right, and U.N. Secretary General, Antonio Guterres, sit as two representatives of Ukraine and Russia delegations check hands during a signing ceremony at Dolmabahce Palace in Istanbul, Turkey, Friday, July 22, 2022.

Khalil Hamra | AP