23 November 2022

CEPS' Elkerbout: COP27 agreed compensation for loss and damage… but the fear is we’ll just end up seeing even more loss and damage

Not all COPs are made equally. After 2021’s COP26 in Glasgow – successfully hyped up by the Boris Johnson-led UK as a showcase of ‘Global Britain’s’ diplomatic mettle – COP27 in in Egypt was perhaps always fated to be a less significant one.

Weak organisational and diplomatic capacity in the authoritarian state made underwhelming outcomes even more likely. Nevertheless, not every COP is supposed to deliver ground-breaking announcements and to expect so is not doing the COP and UNFCCC process any favours.

COP21 in Paris delivered the Paris Agreement, a momentous watershed in global governance that bound nearly 200 countries to a binding, bottom-up process whereby ambition levels are ratcheted in five-year cycles as Parties pledge more domestic climate action.

The Glasgow COP focused political attention on near-term emissions reduction efforts – especially by richer countries – while also successfully concluding technical negotiations to operationalise the Paris Agreement. The COPs in between were by no means a failure but rather laid the groundwork for these larger political deals.

Not a bad COP, not necessarily a good one either…

COP27 led to one major breakthrough amidst a slew of deferrals and tortured compromise texts on mitigation: for the first time, an agreement on loss and damage compensation was found. Loss and damage represent one of the most fundamental fault lines between the developing and developed countries.

Having contributed negligible amounts to the problem (CO₂ concentrations in the atmosphere) while facing some of the greatest climate impacts, developing countries baulk at the prospect of having to foot the bill for the damages of climate change themselves. Richer countries meanwhile fear the long-term liability that comes with agreeing to loss and damage compensation.

The agreement on loss and damage is not at all concrete yet. It is unclear how much finance will be made available, who will cough up the money, who will be eligible to receive funds or what the wider institutional arrangements will be. Nevertheless, this first official inclusion will mean that future COPs will return to flesh this out, even if outcomes depend on future diplomacy.

The best way to limit loss and damage financing would be to limit the amount of loss and damage in the first place. Here, the COP was seen as disappointing as there was no strengthening of the language on the ‘phasedown’ of coal, or fossil fuels more generally, while it actually took effort to maintain language on the 1.5C target. Looking at the design of the Paris Agreement, the moment when countries should really put-up increased commitments is during the ‘global stocktake’, the first one which finishes in 2023, followed by a new five-year cycle up to 2028.

Beyond the headline decisions, as with every COP, distinguishing between the political, the legal and the technical is useful when assessing outcomes...

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