At COP27 the world’s largest economies, including the US, announced that by next year’s COP they will unveil a detailed plan to speed the green transition. The plan, dubbed the “Priority Actions,” could encourage companies to band together and reduce emissions across their sector, particularly in the resource-intensive industries like cement, power, and agriculture. The priority actions may even include a target date for phasing out gas-powered cars.

The plan comes at a critical time, as global carbon emissions are on track to grow by 1%, and reach another all-time high, according to Global Carbon Project's Global Carbon Budget 2022 report that was just published. Impressively, China and Europe were able to reduce their carbon emissions in 2022, though their progress was nullified by emissions increases by India and the US.

At COP27coal made last year in Glasgow should be expanded to include all fossil fuels, said an anonymous source.

Why This Matters

Worldwide, companies are continuing to ignore climate deadlines. A new report, published last week, by Greenpeace  and the University of Technology Sydney (UTS) found that the world’s largest car manufacturers are on track to build 400 million more combustion engine cars more than is allowed by a 1.5 C cap on planetary warming. Beyond 1.5 C degrees of warming, we risk a runaway climate collapse.

We have already surpassed 5 of 9 climate tipping points, including the melting of Greenland’s ice caps, and the collapse of the Atlantic Meridional Overturning Circulation, an essential Gulf Stream current. We are on track, too, to trigger other tipping points, like the widespread melting of permafrost, which could cause lakes and rivers to abruptly drain.

To halt the progression of climate change, experts warn we must cut methane emissions. The potent greenhouse gas traps heat 80x more effectively than carbon does, and is responsible for more than 25% of global warming. At COP27, President Biden introduced a plan that would put $20 billion towards halting methane emissions and would aim to fix leaks and update equipment in the oil industry. These tightened regulations could reduce methane emissions from the oil and gas industry by up to 87% below 2005 levels. Plus, new technology may even help scientists stop these leaks by spotting them from space.

Tightening Their Belts

The excitement sparked by President Biden’s announcement, though, is hampered by fears that a global recession could limit funding for combatting climate change, especially as some investors walk away from ESG funds. The growing reluctance to prioritize responsible investing is causing worry, as it comes on the heels of renewed calls for developed countries to fund clean energy transitions and climate disaster recovery in poorer countries.

The US, however, is moving ahead with some of its climate investments in less developed countries, particularly in Indonesia. Last month, in a partnership with Japan, the US contributed to a $20 billion deal that will help Indonesia quit coal. Plus, ExxonMobil reached a $2.5 billion agreement with Indonesian state-owned company Pertamina, that will fund carbon recapture projects in the country. Indonesia and the Asian Development Bank (ADB) are also working together to close a coal-fired power plant in West Java ahead of schedule.

A coming recession, though, makes some countries hesitant to extend help, especially as Europe has tightened its budget following the war in Ukraine. To compensate, Special Presidential Envoy for Climate, John Kerry has proposed granting  carbon credits to large-scale corporations in return for their investments in green energy in developing countries and using the proceeds to help developing countries cover the cost of disaster relief and adaptation.