Uncomfortable end to Cop 26 talks

As the UN Cop 26 climate summit ran into overtime, US envoy John Kerry told delegates that negotiations should be "uncomfortable", but he could not have foreseen how uneasy things would get by the evening.

Kerry was speaking on 13 November, the summit's extra day, at an informal 'stock-taking' session where countries have the chance to publicly give their feedback on the third draft of the Cop 26 cover decision, its final text. This included reference to accelerating efforts to "phase out" unabated coal-fired generation and fossil fuel subsidies, the first time this had reached the final draft of a cover text.

Countries group together at Cop summits in like-minded coalitions for negotiations. Coalition leaders spoke to express their reluctant acceptance of the deal — poorer countries felt they had not won commitments on finance or sufficient progress on plans for a facility to assess "loss and damage" caused by climate change. The Environmental Integrity Group (EIG) — a grouping of countries focused on ensuring strong protections and transparency — expressed concern over some aspects of the agreement on carbon offset markets, known as Article 6. The Alliance of Small Island States (AOSIS) said the agreements were not enough to save their low-lying countries. Australia — which rarely speaks publicly at climate negotiations — said it "could live with" the agreement, as did Brazil. South Africa and Nigeria expressed serious concern about fossil fuel subsidies and the need to support their vulnerable populations.

But all countries that spoke said they could live with the final product, acknowledging that no one gets everything they want from a final package that has to be approved as a whole and requires consensus.

Cop 26 president Alok Sharma decided to move straight to a final formal plenary to approve the text. But this was immediately derailed and huddles of negotiators formed on the plenary floor around him, Kerry and the EU climate chief Frans Timmermans. These three and the chief negotiators from China and India eventually moved off the floor and beyond the eyes of media, observers and other negotiators. When they returned, Sharma began the formal approval plenary but faced an immediate intervention from China and India, opposing the package.

India tabled a change in text, replacing "phase out" of coal with "phase down" and to "phase out inefficient fossil fuel subsidies, while providing targeted support to the poorest and most vulnerable in line with national circumstances". "Phase down" is the phrase used regarding coal in the bilateral US-China climate pact.

Sharma could have proposed the changes to the text himself but decided to make India and China step up and state what they wanted publicly. He told reporters later that China and India had been ready to vote against the entire package if it was not agreed, leaving him little choice.

The EU, EIG and AOSIS groups spoke to condemn the last-minute move but reluctantly accepted it, not wanting to risk agreements won on other issues such as Article 6 and a "ratchet" agreement that will force countries to present new Nationally Determined Contributions (NDCs) at next year's Cop 27 meeting in Egypt. Until now these are renewed only every five years, but the more climate-ambitious countries won agreement that this should be brought forward because the current NDCs do not keep the world on a path to 1.5C of global warming. This means a further year of diplomatic efforts and lobbying ahead to push some countries to present more ambitious NDCs.

The rulebook for Article 6 was agreed, six years after it was created in the Paris Treaty, and adopted fairly strong rules against double counting of emission reductions, an issue that had previously prevented agreement. Article 6.2 creates a government-to-government level market, allowing countries to buy carbon credits to meet their NDCs.

On Article 6.4, regarding the voluntary market for private entities, participants can buy from other countries and transfers will be authorised by the government hosting the emissions-cutting project, which will then be responsible for making corresponding adjustments in their national inventory. Currently, most voluntary trade does not involve any formal export of credits from the host, but participants now have the option of buying these credits with corresponding adjustments, which many see as much more environmentally beneficial. National policies for approving these will need to be set up, and some countries have been preparing these in expectation of a deal. Credits traded under 6.4 are subject to a 5pc deduction called "share of proceeds", with funds put into an adaption fund for countries most vulnerable to climate impacts.

Adaption funding was a key issue at Cop 26. Most climate finance is provided for emissions-cutting projects, but countries most subject to climate damage such as floods and drought want funding to be used to help deal with these events. Adaption finance will now be doubled as a share of total climate finance.

Negotiators failed to gain agreement on "loss and damage", which has been pushed to Cop 27. The previous Cop set up the Santiago Network, which brings together technical assistance and research on dealing with damage caused by climate-related natural disasters like typhoons. Poorer countries wanted this expanded, but richer countries are concerned about legal liability or reparations.

Even with the late watering down of the text, it is the first Cop cover text to mention coal or fossil fuels, and the most ambitious countries will look to build on that. South Africa, which generates around 90pc of its power from coal, signed an agreement with the EU and US for a funding plan to help it phase out coal-fired generation. Similar deals may be needed for countries like India to give them the confidence they can manage a more rapid decline in coal use.

By Eleanor Green