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ECSP Weekly Watch | November 12 – 15
November 15, 2024 By Neeraja KulkarniA window into what we’re reading at the Wilson Center’s Environmental Change and Security Program
Shell Wins Appeal to Overturn Landmark Emissions Ruling (Al Jazeera)
Three years ago, a court in the Netherlands ruled in favor of environmentalists and required energy giant Shell to drastically reduce its greenhouse gas (GHG) emissions. The decision would compel the company to cut the absolute carbon emissions it created in 2019 by 45% by the year 2030—including emissions caused by its products. This ruling was the first of its kind by requiring companies to adhere to the Paris Agreement, and it ignited further attempts by climate activists to take legal measures against other fossil fuel companies.
As 2024 comes to a close, Shell now has won its appeal to overturn the landmark ruling. The company made its case that the obligations it incurred via the judgement negatively affecting its profits and reduced its capabilities to advance on climate action. For instance, Shell argued that the ruling created barriers to providing gas to companies diversifying away from their coal dependencies and thus reducing GHG emissions. The upshot is that emissions reductions for fossil fuel companies must be determined according to complex demand patterns.
Shell’s win came at a moment in which the court’s decision provided s stark juxtaposition with the commencement of COP29 in Azerbaijan. The ruling renounced the imposition of concrete obligations that the initial judgement created, citing a lack of clarity in whether reducing emissions caused by Shell’s products would combat climate change in a material way. The new Dutch court ruling also highlighted that Shell was on its path to meet its voluntary targets, and argued that the court could not define the extent of stated emission reduction goals.
READ | A Decade of Progress on Palm Oil Deforestation at Risk in Indonesia
Brazil Spearheads Agenda on “Bioeconomy” (Yale E360)
As the host of the upcoming G20 summit, Brazil has laid out its one of its key initiative: “Bioeconomy.” It is an approach that promotes the sustainable use of green resources, while simultaneously empowering Indigenous peoples. This concept has taken several forms since its creation in the 1970s when it was coined by Romanian economist Nicholas Georgescu-Roegen.
Brazil’s president Luiz Inácio Lula da Silva announced plans to spearhead this concept in its own backyard by making the Amazon a model for a greener, less extractive, and socially responsible economy. Lula was welcomed in this initiative by French president Emmanuel Macron, who recently sealed a billion-dollar deal with Brazil to preserve the world’s largest forest with hopes that conservation would also economically benefit local communities.
Many countries including the United States, Malaysia, and some from the European Union already have adopted strategies for sustainably exploiting their own resources. What is missing though, is a clearer overall definition. So, Brazil is expected to elaborate further on its agenda during the G20, toward encouraging countries to advance on green economic pathways collaboratively.
READ | Climate Change Front and Center in U.S. and Brazil Relations in Biden-Bolsonaro Era
Can Investment Capital Address Public Climate Finance Shortfall? (Mongabay)
As expected, climate finance is dominating the agenda of the ongoing COP29 meeting. Attendees hope to set a viable new financial target, as they move away from a $100 billion pledge that did not fully materialize. Developed countries have argued that they face significant barriers in mobilizing funds to aid developing countries. Yet one way in which this shortfall may be addressed is through an increased role for development banks.
New and innovative blended finance approaches have mobilized public and private capital in equilibrium over the past decade. Yet the lack of available risk capital, shortcomings in mobilizing private funds, and the voluntary nature of financing led the developed countries to backtrack on their pooled commitments. Larger financial institutions, such as the World Bank and the International Monetary Fund, could play a role in bridging this gap.
Many richer countries are determined to direct $2 trillion in climate finance funds to poorer nations feeling climate impacts by 2030. Given the world economy worth $105 trillion, there is a possibility of mobilizing such a large sum. (Previous crises, such as the COVID-19 pandemic, have demonstrated that such a level of financing is possible.) The New Collective Quantified Goal (NCQG) developed now will also help developed countries and investments tailored to the varying needs and capabilities of developing countries, such as prioritizing climate-vulnerable states.
READ | A Climate Finance Rethink Can Help Those Most Impacted by Climate Change
Sources: Al Jazeera, Mongabay, UNFCCC, Yale E360