COP26 Media Briefing – GSCC

featuring Richie Merzian

GSCC Media Briefing – 10.30am GMT / 9.30pm AEDT 11 November 2021
E&OE Transcript, check against delivery

Remarks by Richie Merzian, climate & energy program director at the Australia Institute, to Global Strategic Communications Council Media Briefing

| Note: remarks by Dorka Bauer and Bernice Lee have not been included in the transcript below

Richie Merzian:  Thank you, Dorka, and thank you, Bernice. So I work for a think tank based in Canberra called the Australia Institute, but previously was an Australian negotiator on climate for over a decade.

I’ll just give a quick snapshot on where things are at in terms of the presidency’s text and where the Glasgow pact could end up.

So the presidency put forward its hopeful landing spot yesterday, and that’s always the high watermark in terms of how ambitious something could be. And the UK wanted to show its cards and show where it wanted things to go.

Three things in particular jump out, which is really where I’m keeping my eye on. 

The first is around fossil fuels. The Paris Agreement, a major omission was there was no mention whatsoever of fossil fuels or any — in particular — big coal, oil or gas, and so for the first time ever, we’re seeing draft text put forward that calls for the phase out of coal and for the phase out of fossil fuel subsidies. This is more ambitious language than we’ve seen before in the G20 or in any other forum. And this is particularly important if we’re going to actually bring down the emissions over the next decade to actually address the key source rather than just use targets as a proxy. However, we’re already hearing pushback from major fossil fuel producers, namely Saudi Arabia. But if we are talking about coal, Australia exports more coal in terms of share of world trade than Saudi Arabia does oil. So I’d keep your eye on where Australia is going to go in terms of pushing that language out of the presidency’s text.

The second is around finance. Climate finance is the glue that brings a package together at the end of a COP. And unfortunately, the finance in this particular package is undercooked. Reiterating the $100 billion per annum goal, which is yet to be mobilised, is the starting place. Really, there needs to be more language around where finance is going to go. What that looks like, what the process is for a new target, for ambition going forward as well, and how that connects into loss and damage and the adaptation mitigation split, too.

And then the third, of course, which is the primary reason that this is a politically significant COP is around ambition. Now we’re seeing a clear push to have countries bring forward NDCs that are actually aligned with the 1.5 degree goal. This is clearly a strengthening of the Paris Agreement, which has a guardrail of 2-1.5. 1.5 means that most countries will have to come back with stronger targets that really will target those countries that haven’t bought back any strengthening of the 2030 target. So again, Australia is probably, I think, the only wealthy advanced economy that hasn’t put forward an updated 2030 target. There’s a couple of others as well. They’re the ones who will be the first ones to react to this. But really, overall, there’ll be many countries that will need to bring back stronger targets. You’ll see countries push back and want to go back to previous language that it has been agreed, which is far softer.

So those are the three kind of issues that watch out for: fossil fuels, finance and ambition.

Also, good to keep an eye on transparency, but understand that there’s a briefing letter from Pete Betts that’s around transparency that’ll probably go into detail for those who want to go there.

If you want to know what ambition looks like, then I suggest you turn your eyes to the climate vulnerable forum’s statement that and video that they put out recently, which we can pop into the chat that shows you what the alliance is the most ambitious and vulnerable countries want, which is a good sort of model or measuring stick to see where we ultimately end up with. In terms of process, the presidency has been using shuttle diplomacy, going back and forth between the different negotiating groups, getting soundings and submissions on what should stay in, what should stay out, whether they can live with what the presidency has put forward. At 11:15 a.m., there’ll be an update from the presidency that might be in the form of actually putting forward a new version of the text. Or if that’s not ready, then at least explaining where things wrap on each of the different areas. So that’ll be one to watch for in about half an hour’s time.

Might stop there and allow us to get to questions.

Q: Can you tell us more about how Australia has engaged in the negotiations, Richie?

Richie Merzian:  The Australian Government’s engagement has been more surface than substance. The Australian Government came to COP26 basically to get away with doing as little as possible.

The Australian Government is quite conservative, they only agreed to net zero by 2050, two days before the Prime Minister took off for his European trip. They have been quite disappointing overall in terms of their position. They’ve pushed back on doing anything more in the next 10 years, they’re not committing to even a linear target — so just decreasing emissions in line with net zero. They only want to look at technology, they only want to support corporations.

Most recently, the Australian Government announced $500 million — but for carbon capture and storage. So for technologies that support the continued production of fossil fuels. The Australian Government has over 100 new fossil fuel projects in the pipeline. It is the third largest exporter of fossil fuels in the world after Russia and Saudi Arabia. And really, it should be seen in the same grouping as Russia and Saudi Arabia both refused to put forward short term targets that are updated and have only, committed to vague net zero plans.

So, it’s unfortunate that Australia hasn’t joined the UK and the US in trying to put everything on the table for this COP. Instead, it’s done as little as possible.

The only thing that Australia really has brought to this negotiation is good coffee over at the Australian pavilion.

Q: Sharma said yesterday in his press conference that first lost capital is not likely to be in the text. This seems to be what the private sector is asking for in order to unlock scalable private investment.

Richie Merzian:  I mean, this is pretty high level text. It’s not going to go into detail around how to structure actual financial products. And whilst the private sector might want this, it seems like something that’s more appropriate to be dealt with in a side deal or an alliance, or in some sort of stitch up with the multilateral development banks and some of the private sector than to actually filter into decision text here. I mean, it’s not uncommon for Governments to provide first loss, but it would be quite unique, if not unorthodox, to see it actually make it into decision text.

Q: How big of a problem is Australia, Richie?

Richie Merzian:  I mean, Australia’s in a unique position in that it is the permanent chair of the umbrella group of countries, right, which is all the original annex one countries that aren’t part of the EU. And so every morning Australia will meet with the US and Russia and Japan, Canada, Norway in order to discuss the issues of the day.

And so it does have some influence here beyond its size.

It is a top 10 per cent world emitter and, you know, and it does have a really good diplomatic team that is quite active. And so ultimately it will have some influence. It has managed to hold the line, push back on its neighbours, who are probably in the Pacific, the strongest voices for 1.5 degrees. So it can have a real, a real sort of– basically act as a handbrake on ambition here, especially since it– because it is a developed country because it is an original, wealthy western country.

If Australia refuses to increase its ambition for 2030, it provides cover for other countries to not do the same. They can point to Australia saying if Australia doesn’t do it as a wealthy developed, high emitting country, then why should we?

That’s the real problem here. Australia is also quite low on its climate finance pledge. It is the only developed country that pulled out of the Green Climate Fund, despite co-chairing the fund in helping develop it back in the day as well.

So, Australia, I think, is not a constructive force here. They’re polite, they’re not obstructionist, but nor are they assisting the UK or the US in pushing for as much ambition as possible. This is a government that wants to get away with doing as little. That’s why they drag their feet all year until they finally got to net zero and then the actual net zero plan won’t be legislated, won’t have an impact, will be highly reliant on technology and offsets.

And the Australian Government has said that it sees a bright future beyond 2050 for its coal and gas production. I mean, there’s over 70 new coal mine proposals in Australia. And Australia is arguably the largest exporter of coal in the world. And it is the largest exporter of liquefied natural gas as well.

So, you can’t underestimate Australia’s interests here, which are to see the longevity of its fossil fuel production, if not the expansion, which is running directly counter to what the UK is trying to push in terms of consigning coal to history. And it’s a real shift in gap in between it’s otherwise close allies UK, US and Australia.

Q:  We are hearing about blocking from Australia and Saudi. What about Russia and Brazil or any other coal dependent nations?

Richie Merzian: I mean, the last 24 hours has mainly been around sort of the backroom private negotiations between the presidency and different groups, so it’s a bit hard to hear anything concrete or point any fingers directly, but we know where the interests lie for countries like Brazil in terms of wanting to see sort of strong carryover credits from Article six, wherever that goes in a few other items, too. We know that large emerging economies are also a bit reluctant to be boxed into having targets that align with 1.5 degrees as well. Whether they come out publicly or not is a big question.

This will become a bit more apparent once we have the next presidency stocktake at 11:15, and we actually have open plenaries where countries can respond on the floor. Then you’ll be able to concretely know who is causing more trouble and who is actually pushing for more ambition. Until now, it’s all sort of in the rumour mill.

Q: I just wanted to ask you both if you could offer a quick insight on where to focus the attention today and what would be interesting to watch as the day emerges.

Richie Merzian:  Thank you. As is common in the COP, I have been kicked out of my meeting room a couple of minutes early, but I’ve found a space in the hallway.

At 11:15 is the presidency update that will be key, that’s the ultimate sounding for the day, so I recommend everyone tune in to that. That should give you a good steer on how the text is looking, where the major issues are. The presidency might assign additional ministers to assist in shuttling solutions there.

Just in terms of Alex’s question, how does the declaration work? How does the package come together?

This is a consensus-based process. The rules of procedure have never been adopted and so everything has to be agreed. So nothing is agreed until everything is agreed.

But at the same time, there is a tendency to not allow any one country block what appears to be an overwhelming level of support. And we saw this in 2012 in terms of Russia being railroaded to get an outcome. We saw this again with Copenhagen, in Cancun.

And so it could be the case here as well, depending on how much on the capital that the presidency wants to spend, the political capital, in pushing for a strong declaration.

Also, if the presidency feels like things are not ambitious enough or wants to actually call-out laggards, the presidency will have an open consultation so that countries will have to put forward their disagreements on the floor of the plenary, and so you’ll see it all play out live. So there’s a few things that the presidency could do to air out where the issues of concern are and hopefully push for a more ambitious outcome. And that’ll be really interesting to see how that plays out in the next 24 to 48 hours.

But I expect this to go overtime

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