20 December, 2023

"The only GST that matters for 1.5°C": key takeaways from the first global stocktake at COP28

We breakdown the key takeaways from the first global stocktake (GST) since the Paris Agreement and how it sets the stage for the next two years in climate.

The gavel came down and COP28 President, CEO of the UAE’s national oil company, Dr Sultan Al-Jaber, announced the adoption of the first Global Stocktake (GST) of the Paris Agreement. There was applause. The outcome acknowledged the elephant in the room that had plagued negotiations since 1992. It called for “transitioning away from fossil fuels in energy systems … accelerating action in this critical decade …”.

But the bigger applause came for the 39-country strong Alliance of Small Island States (AOSIS), when they took the floor to ask ‘what had happened?’ The critical next step in implementing the Paris Agreement had been agreed without some of the most vulnerable countries in the room. And as lead negotiator Anne Rasmussen said, “this first GST is of particular significance. It is the only GST that matters for ensuring that we can still limit global warming to 1.5C”.

The good news

1.5oC is centre stage for next round of NDCs

The continued feasibility of limiting warming to 1.5°C is at the centre of the GST decision. There is explicit recognition that this requires deep, rapid and sustained reductions in global emissions of 43% by 2030 and 60% by 2035 from 2019 levels.

This is significant. It sets the stage and heightens expectations for strengthened 2030 Nationally Determined Contributions (NDCs), and for all new NDCs due by early 2025, to be 1.5°C aligned. The shift outlined in the agreement towards economy-wide NDCs, covering all gases and sectors, is also good progress.

The GST outcome also introduces several new initiatives aimed at ensuring follow-through. These includes the Technology Implementation Programme, annual global stocktake dialogues, a UNSG special event to present NDCs and launch of a “Road map to Mission 1.5”.

A first step towards 1.5°C: peaking global emissions before 2025

Highlighted in paragraph 26 is the 2025 deadline to peak global emissions, something that was clearly communicated by the Intergovernmental Panel on Climate Change in its latest cycle of reports.

In analysis released just ahead of COP28, we found that global greenhouse gas emissions could peak this year if the acceleration in solar, wind and electric vehicle deployment continues. When combined with accelerated reductions in methane emissions, the likelihood of emissions beginning a structural decline in 2024 is even higher.

Sets 1.5°C as benchmark for action

Paragraph 28 first recognises the need for ‘deep, rapid and sustained reductions in greenhouse gas emissions in line with 1.5°C pathways’. It then calls on Parties to contribute to the global efforts set out in the Paragraph. In doing so, it sets 1.5°C as the benchmark for action. As Paragraph 28 includes a range of measures, this requirement is fundamental to evaluating the significance and role of each measure.

Tripling up and doubling down

The new global goals to triple renewable capacity and double energy efficiency in paragraph 28a could make a significant dent in emissions and fossil fuel use by 2030. When the Climate Action Tracker looked at COP28's announced initiatives, it found these pledges held the most promise, but highlighted the urgent need for monitoring of countries’ actions to ensure these global pledges are turned into concrete, national action.

We are currently analysing what the global tripling goal could mean at the regional level – and ultimately for specific countries.

Transitioning away from fossil fuels

Throughout the COP, the momentum behind the need for a fossil fuel phase out was palpable. Even countries with expansion plans for fossil fuel production, like Australia, the UK and the US, were publicly expressing their support for such language, although they were reluctant to provide the finance needed to support a phase out in less wealthy countries whilst planning to expand gas and oil production.

This was balanced against the influence of big oil: Saudi Arabia’s energy minister noted that “we were given priority that I don’t think I have ever seen it in any such conference”. Leaked letters from OPEC to its member countries revealed its ask for member countries to refuse to sign a fossil fuel phase out deal. A sign of panic from the oil cartel, whose restrictions on production are failing to revive a slump in prices and diminishing their market share.

The transition has already begun, with the International Energy Agency projecting that even under current policies, fossil fuel demand will peak this decade. The COP28 decision calls for this to accelerate this decade, meaning a faster peak and decline. By 2030, 1.5°C pathways show reductions in fossil fuel use of around 40% from 2020 levels – that’s around 6% per year. This will need to be reflected in national fossil fuel production plans, which are currently more than double what is compatible with 1.5°C pathways.

Potential loopholes

Energy systems: a strong signal, if correctly interpreted

Paragraphs 28c and 28d highlight the need to transition away from fossil fuels in the energy system, so as to achieve net zero energy systems by 2050.

This can set a strong and clear long-term direction, if interpreted correctly. The energy system includes energy supply and use (for example in transport and industry), and all emissions across this system will need to fall to essentially zero to achieve this goal. Importantly, land-based removals are not part of the energy system, so these cannot be used to meet this goal.

However, at the same time, the term ‘energy system’ could be wilfully misinterpreted. Some governments may try to argue that this only covers the use of fossil fuels to provide energy. However, there are emissions-intensive processes in the energy system that use fossil fuels as a feedstock, including chemicals, steel and fertiliser production. These sectors, which account for about 15% of CO2 emissions globally, and have decarbonisation alternatives, definitely do not deserve a free pass on fossil fuels.

Any attempt to narrow the scope of the energy system would be inconsistent with limiting warming to 1.5°C.

Accelerating zero and low carbon technologies

Paragraphs 28e endorses some technologies that in fact have a minimal role in the energy transition (e.g carbon capture and storage – CCS), as well as those that may not necessarily achieve emissions reductions (carbon capture utilisation and storage, blue hydrogen and fossil gas as a “transition fuel”).

Blue hydrogen made from fossil gas is a bad idea because of its cost, non-zero emissions, dependency on CCS infrastructure, and lock in to fossil demand. Hydrogen production should focus on fully renewable energy sources.

We know from the science that CCS technologies will have a negligible role this critical decade and should be reserved for sectors where there are limited alternative options. Fortunately, the need for CCS grows smaller each year as alternatives become available for sectors such as iron and steel, fertiliser, cement and chemicals – the IEA has revised down the use of CCS by 2030 in its 2023 net zero emissions scenario by 38% from its 2021 version.

And despite its promotion by some, the science shows there is little to no role for CCS in the power sector.

CCS would also need to achieve very high CO2 capture rates of 95% or greater to achieve meaningful emissions reductions consistent with getting to zero emissions. However, the track record of CCS is very poor in this regard, with many projects achieving capture rates of only around 50%. During the COP we released an analysis of the impact of CCS on global emissions if deployed at a major scale but with a low CO2 capture rates of around 50%. This would, we calculated, add around 86 billion tonnes of greenhouse gases to the atmosphere from 2020 to 2050.

Coal power

The COP outcome calls for an accelerated phase down of ‘unabated’ coal in paragraph 28b, with no timeline. We know we need to phase out all coal power by 2040 and halt the construction of new plants. The State of Climate Action report shows we need to move around seven times faster to follow a 1.5°C coal phase-out pathway that ends coal generation by 2040.

Fossil gas needs to be phased out not expanded

Another significant concern is that Paragraph 29 could be used by some countries to open the way to further fossil gas developments. Paragraph 29 refers to “transitional fuels” playing a “role in facilitating the energy transition while ensuring energy security”. This is very much the narrative of the gas industry and is understood to be text that Russia insisted on. In contrast, the IEA’s Net Zero road map shows that gas needs to be phased out of the energy system quite quickly, declining about 2% per year this decade and 6% per year for several decades after 2030. It also says there should be no new investment in long-term gas production.

Attempts to use this paragraph by countries to justify expanded gas production would be inconsistent with limiting warming to 1.5°C and unnecessary to protect energy security given the potential for renewables to scale rapidly and the rapidly declining cost of storage and other technologies.

Looking ahead to 2024 and 2025

To ensure that this Global Stocktake does close the 2030 emissions gap, the goals agreed in Dubai will need to be closely scrutinised to see if they deliver. Our annual Climate Action Tracker update released at COP28 shows governments are still a long way from closing the gap; their 2030 targets still less than acceptable and none of them are on a 1.5˚C pathway.

There was also a little avalanche of initiatives announced at the COP – the Climate Action Tracker estimated about 74. While the pledge to triple renewables and double energy efficiency improvements could be a real step forwards, some of the other pledges did not amount to very much. There is an urgent need for these kinds of voluntary initiatives, for which much is made of politically, to be tracked and held to account in terms of meeting goals over time. We will be looking into this next year.

In 2025 governments will announce the next set of targets – for 2035. Emissions reductions before 2030 are the field on which the battle to limit warming to 1.5°C will be won or lost. Governments need to make sure that these next targets are both 1.5°C-aligned, and that this ambition is backed up with updated 2030 targets that create a credible path to achieve them. COP28 repeated the request (from Glasgow and Sharm el-Sheikh) for parties to revisit and strengthen their NDC 2030 targets to align with the Paris Agreement temperature goal by the end of 2024. This is critical for keeping 1.5°C in sight and we will be watching this carefully.

A critical lever to unlocking higher ambition will be increasing climate finance to developing countries. This will be a big issue in the next year as the new collective quantified goal on climate finance is meant to be decided in Baku at COP29. It, and the GST, will be major building blocks for new NDCs. Without a serious step change in finance provisions, governments of vulnerable and poorer countries will be constrained in coming back to the table with the kind of ambition needed to keep 1.5°C alive.

Next year 40% of the world’s population will head to the polls in national elections. These governments and their leaders will be stewards the most critical time for climate action yet. It could also be the year that we finally begin to reduce global emissions – the inevitable, and sorely needed, first step towards a liveable future for all.

As AOSIS stated at the end of COP28, “the course correction that is needed has not yet been secured” – there is much more work to be done.