COP27 Dispatch - November 9, 2022 | Newsletter

Welcome! Today is finance day at COP27.

Climate finance refers to “local, national or transnational financing—drawn from public, private, and alternative sources of financing—that seeks to support mitigation and adaptation actions that will address climate change.”

Trillions of dollars are needed to achieve global Paris Agreement climate goals and adapt to climate impacts. Over a decade ago at COP15, developed countries promised to mobilize at least $100 billion per year by 2020 to help developing countries address climate change. But that promise has not been fulfilled, with countries like the U.S., Canada, and Australia missing their finance targets. Negotiators at COP27 are working to create new climate finance goals through 2025.

During speeches at the World Leaders Summit, developing countries reinforced the significant need for increased climate finance, including for loss and damage. As Malawi President Lazarus McCarthy Chakwera said: “We believe that the clear difference in culpability and capacity between nations must be reflected in the level of responsibility they bear for climate mitigation, adaptation and financing…That is fairness. That is justice.”

If you are in Egypt, catch up with EESI's Executive Director Daniel Bresette and Policy Manager Anna McGinn! To connect, visit us at Booth 14 in Area B or email Anna at [email protected].

Missed yesterday’s issue? Check it out here! Also, be sure to find EESI's glossary of terms and other helpful guides in the Resources section!

U.S. leaders launched new initiatives to scale-up climate finance for developing countries, including the Energy Transition Accelerator and Joint Green Finance Pilot Program. (U.S. Updates)

The Net-Zero Asset Owner Alliance and Net-Zero Asset Managers initiative both expanded and now represent trillions of dollars of assets with net-zero targets. (Other News)

Sections

U.S. Updates | Other News | Resources

Scatec CEO Terje Pilskog (left) and U.S. International Development Finance Corporation CEO Scott Nathan (center) sign a retainer letter to develop a green hydrogen plant in Egypt as U.S. Special Presidential Envoy for Climate John Kerry looks on. Credit: Environmental and Energy Study Institute

Energy Transition Accelerator: U.S. Special Presidential Envoy for Climate John Kerry, the Rockefeller Foundation, and the Bezos Earth Fund launched the Energy Transition Accelerator (ETA) to mobilize private capital for clean energy transitions in developing countries to help them reach their Paris Agreement goals.

► EESI Podcast: “Boosting Innovative Companies to Accelerate Climate Solutions”

Joint Green Finance Pilot: Chief Executive Officer of the U.S. Millennium Challenge Corporation (MCC) Alice Albright announced the launch of a new collaboration, the Joint Green Finance Pilot Program, between MCC and the U.S. Agency for International Development (USAID) to scale up green finance in low- and lower middle-income countries. According to Albright, “USAID will support the development of green bonds in up to five additional countries by public-private partnerships.”

U.S.-Philippines Clean Energy Procurement Pilot: The Clean Energy Demand Initiative (CEDI) was launched at COP26 to help link public- and private-sector partners in efforts to develop and produce renewable energy in emerging markets. Today, Assistant Secretary of State for Energy Resources Geoffrey Pyatt announced the first CEDI pilot—a partnership between the Philippines Department of Energy and USAID—that will lead to new renewable energy procurements for manufacturing operations.

Green hydrogen in Egypt: John Kerry highlighted the role of the U.S. International Development Finance Corporation (DFC) in the first green hydrogen project in Egypt. U.S.-based Plug Power, which already has a presence in Egypt, will supply the electrolyzers. The 100-megawatt plant will produce green ammonia that will be used in fertilizers and other products. Kerry also highlighted the potential for the Inflation Reduction Act to help make green hydrogen more economically feasible in other developing countries by contributing to lower costs in a major market.

► EESI Briefing: Green Hydrogen

U.S. international climate investments: The DFC also announced that it committed $2.3 billion for climate-related development projects in fiscal year 2022, including $50 million in financing for solar projects in Egypt and a $500 million loan to First Solar to construct a manufacturing facility in India.

► EESI Article: “First Solar Is Pioneering Responsible Solar Manufacturing in the United States”

Public opinion on natural climate solutions: A new poll released today by U.S. Nature4Climate found that 86% of voters nationwide support natural climate solutions. Of the range of natural climate solutions tracked in the poll, “programs that help cities and towns plant trees in parks and along streets” was the most popular at 89% support. EESI Executive Director Daniel Bresette participated in a panel about these results, saying “natural climate solutions are a key area for U.S. policy leadership at COP27. And that leadership can move ahead on a bipartisan basis.”

► EESI Briefing: Natural Climate Solutions

Climate justice: A panel including Shalanda Baker, director of the Department of Energy’s (DOE) Office of Economic Impact and Diversity, and Raya Salter, founder and executive director of the Energy Justice Law and Policy Center (and member of EESI’s board of directors), discussed the Biden-Harris Administration's Justice40 Initiative. Baker described DOE’s new requirement for any entity requesting funding from DOE to create a Community Benefit Agreement. Salter urged companies and other groups to “engage in ways that make community self-determination possible.”

► EESI Briefing: Justice40: The Path Forward for the Administration’s Environmental Justice Initiative

Subnational climate progress: Yesterday, John Kerry and Special Envoy to the U.N. Secretary-General on Climate Ambition and Solutions Michael Bloomberg announced the Subnational Climate Action Leaders’ Exchange (SCALE), “a first–of-its-kind initiative to support cities, states, and regions in the development and implementation of net-zero, climate-resilient targets and roadmaps.” SCALE will initially focus on implementing the Global Methane Pledge, which has a goal of reducing methane emissions 30% by 2030. The U.S. State Department supports SCALE and is planning to provide $1.5 million.

The COP27 venue in Sharm El-Sheikh, Egypt. Credit: Environmental and Energy Study Institute

Net-zero assets: The Net-Zero Asset Owner Alliance (NZAOA) has grown to 80 members with $10.9 trillion in assets. In its second progress report released in September, the Alliance found that 44 of its members have set near-term net-zero targets, representing $7.1 trillion in assets. Another group representing asset managers, the Net-Zero Asset Managers initiative, reported that 86 new investors have set initial net-zero targets, increasing the number of investors with net-zero targets to 169, representing $21.8 trillion. In total, the initiative has 291 investors, as 21 new managers joined today.

► EESI Podcast: “What Is the Net-Zero Asset Owner Alliance and Why Does It Matter?”

Finance for climate action: The Independent High-Level Expert Group on Climate Finance, formed by the COP26 and COP27 Presidencies together with the UNFCCC High-Level Champions, released a report called Finance for Climate Action: Scaling up Investment for Climate and Development. The report intends to provide a framework for climate finance based on the goals of the Paris Agreement and the Glasgow Pact. A key message of the report is that the world needs a roadmap to mobilize $1 trillion per year in finance by 2030 to support emerging markets and developing countries.

► EESI Briefing: The Role of International Climate Finance

Mobilizing solar investments: The World Resources Institute, International Solar Alliance, and Bloomberg Philanthropies launched a report outlining recommendations for mobilizing $1 trillion of investments in solar energy by 2030, including that “governments can take action immediately, in partnership with commercial banks and development finance institutions, to address these barriers and to replicate and scale effective solutions.”

Just financing: Egypt’s Minister of International Cooperation Rania Al Mashat presented a new framework called the Sharm El-Sheikh Guidebook for Just Financing, which sets an actionable agenda on just climate finance for stakeholders at all levels. The Guidebook defines just financing as “financing that accounts for historical responsibility for climate change while ensuring equitable access to quality and quantity climate financing that supports resilient development pathways leaving no one behind.”

Tracking emissions: Former U.S. Vice President Al Gore launched Climate TRACE, which is a global non-profit coalition created to independently track greenhouse gas emissions using satellite imagery and AI technology. Users can freely download data and explore a world map of emitting facilities. This data can be used to verify pledges like the Global Methane Pledge. The Climate TRACE data suggests, for example, that actual methane emissions are triple what current reports estimate based on new data on flaring and methane leaks.

► EESI Article: “Addressing Methane Emissions Is Critical for Fighting Climate Crisis”

Climate Negotiations Database: The Boston University Global Development Policy Center just published the Climate Negotiations Database. The database includes all items negotiated under the UNFCCC since 1995 and includes user-friendly, interactive graphics to explore the data. In an article about the database, authors say the bottom line is: “While the negotiations have broadened to include a wider range of issues, transparency and mitigation matters have dominated the agendas. Greater balance among issues is needed.”

► EESI Briefing: What’s on the Table for the Negotiations?

Corporate climate adaptation: The World Economic Forum published a report laying out a framework for business action on climate change adaptation.

► EESI Briefing: What Congress Needs to Know About Corporate Climate Risk, Resilience, and Disclosures

Africa Carbon Markets Initiative: The Africa Carbon Markets Initiative was inaugurated today “to support the growth of carbon credit production and create jobs in Africa.” The Initiative announced it would create 300 million carbon credits annually by 2030 and 1.5 billion carbon credits annually by 2050 with the goal of supporting 110 million jobs by mid-century.

Increased building emissions: The U.N. 2022 Global Status Report for Buildings and Construction finds that the buildings and construction sectors accounted for over 34% of global energy demand and 37% of energy-related carbon dioxide emissions in 2021. The sectors’ carbon dioxide emissions grew 5% from 2020 levels, despite investments in efficiency. The report recommends mandatory energy efficiency building codes, government investments in energy efficiency, and increased use of circular building materials.

► EESI Briefing: Building Materials: From Production to Reuse

EESI resources

Articles: Quick reads connecting international climate talks to Congress
Briefing series: What Congress Needs to Know About COP27
Climate Change Solutions: Biweekly newsletter covering climate, energy, and environmental issues
COP27 Announcement Tracker: Key Announcements from the 2022 U.N. Climate Summit
COP27 Report Tracker: Key Climate Reports Launched at the 2022 U.N. Climate Summit
EESI United Nations Framework Convention on Climate Change Glossary of Terms
Go-to Resources on the Key Themes of COP27 for Week 1 and Week 2

Tracking the negotiations

CarbonBrief: Reporting and analysis on the U.N. Climate Talks, with in-depth tracking of country positions in the negotiations.
COP27 Resource Hub: World Resources Institute's extensive set of resources on the climate negotiations.
Earth Negotiation Bulletin: A play-by-play of the negotiations plus expert analysis from the International Institute for Sustainable Development | @IISD_ENB
ECO Newsletter: The climate advocate’s perspective from Climate Action Network International | @CANIntl

Background and logistics

Egypt COP27 Presidency website: Priorities, details, and logistics for the negotiations | @Cop27P
UNFCCC COP27 website: Conference details and all updates on documents produced during the negotiations | @UNFCCC and @UNFCCCDocuments
Congressional Research Service: Reports related to the UNFCCC
UNFCCC glossary of terms

Questions about COP27?

Reach out to EESI Policy Manager Anna McGinn with your question and we will get back to you or include the information in an upcoming newsletter.

Thanks for reading!

This newsletter covering COP27 will be running from November 7 to November 21.

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Thank you to EESI staff for their contributions: Anna McGinn, Savannah Bertrand, Emma Johnson, and Amaury Laporte

Environmental and Energy Study Institute
Daniel Bresette, Executive Director

EESI is an independent 501(c)(3) non-profit organization established in 1984 by a bipartisan Congressional caucus to provide timely information and develop innovative policy solutions that set us on a cleaner, more secure and sustainable energy path.

COP27 Dispatch - November 9, 2022

Finance Day

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