COP28 came to an end this month in Dubai in the final weeks of the hottest year in recorded history. Since 1992, this “Conference of the Parties” acts as the annual formal meeting of the United Nations Framework Convention on Climate Change (UNFCCC). The conference, led this year by Sultan Ahmed Al Jaber, the CEO of the UAE’s state-owned oil company, brought delegates from across the world to assess the world’s progress in dealing with climate change and to establish binding obligations for countries to reduce their greenhouse gas emissions. In its 28th year, the conference sought to develop agreements to meet a long-term global temperature goal that seeks to limit warming to below 1.5 degrees Celsius — a target collectively endorsed by nearly 200 countries during COP21 in Paris. Now that COP28 is over, we have compiled a list of key takeaways from this year’s conference.

A global transition away from fossil fuels

Nearly 200 countries agreed to a new climate deal after two weeks of negotiations characterized by bitter divisions over the future of oil, coal, and gas. The agreement calls for the world to move “away from fossil fuels in energy systems in a just, orderly and equitable manner.” However, stronger demands to “phase out” fossil fuels, believed to be a primary contributor to global warming, were ultimately unsuccessful. A “phase-out” had been agreed to by over 100 countries and had been called for by climate activists, but was fiercely opposed by some fossil fuel-producing states such as Saudi Arabia and the chair of the COP28 summit himself. 

Instead, the agreement “calls on” countries to “contribute” to global efforts to reduce carbon pollution in ways they see fit, offering several options, one of which is “transitioning away from fossil fuels in energy systems … accelerating action in this critical decade, so as to achieve net zero by 2050.”

Signatories were asked to have detailed adaptation plans in place by 2025 to show how they intend to deal with the current and future impacts of the escalating climate crisis.

An imperfect agreement

Critics of the deal expressed concern that clear loopholes remain for oil and gas companies to continue producing and using fossil fuels. Specifically, the list of actions for countries to take in the fight against climate change included “accelerating zero- and low-emission technologies, including, inter alia, renewables, nuclear, abatement and removal technologies such as carbon capture and utilization and storage.” 

Carbon capture and storage technology is a set of techniques to pull carbon pollution from polluting facilities and store it underground. This technology has existed for some time now, but climate activists maintain that it has never been proven to work at the global scale needed to have a material impact on the rate of climate change, and they expressed concern that the provision merely permits a continued reliance on fossil fuels.

In fact, the debate over carbon capture and its utility led one scientist to use the COP28 platform to beg attendees to stop planting so many trees. Thomas Crowther, former chief scientific adviser for the United Nations’ Trillion Trees Campaign, argued that the benefits of mass tree planting are largely overstated and are particularly damaging when polluters use such projects as a pretext to evade genuine efforts to reduce emissions. Crowther’s plea comes in the wake of the effects of his own controversial 2019 study, which concluded that restoring degraded forests around the world would undo a large share of human-caused greenhouse gas emissions. Crowther’s study sparked a surge in commitments from large oil companies and political campaigns to plant trillions of trees instead of cutting emissions, a move Crowther now calls greenwashing.

Climate finance 

This year’s conference opened with a focus on the considerable financial burdens associated with climate change, highlighting the disproportionate impact on developing countries that bear minimal responsibility for the majority of greenhouse gas emissions causing global warming. On the first day of the conference, global delegates formally adopted a climate damage fund that was the result of decades of negotiations. So far, countries have pledged around $700 million, a tiny fraction of the overall need. A recent United Nations report found it will cost developing countries $215 to $387 billion per year to adapt to climate change. China, the world’s largest emitter of greenhouse gasses currently, has not committed any funding, though some developed countries are pushing for it to contribute to the fund. The United States committed $17 million, while the United Arab Emirates and Germany committed $100 million each.

Renewable energy

Over 100 countries agreed to triple renewable energy capacity by 2030. Although renewable energy sources are already experiencing rapid growth, achieving this goal would require solar and wind power deployments to speed up significantly. Tripling renewable energy would bring global renewable energy capacity to at least 11,000 gigawatts in just six years - more than 20% higher than current projections. This expansion would require a significant increase in investment in renewables, which the International Energy Agency says hit $600 billion globally last year.

But the renewables industry faces other roadblocks, including supply and labor shortages, increasing costs, and local opposition to large energy projects leading to years-long delays in obtaining necessary permits. While the industry may face an uphill battle to meet this ambitious goal, based on the rate of growth for wind and solar power in recent years, the world is actually on track to meet this target.

Methane reduction

The Global Methane Pledge is a commitment to reducing methane emissions by 30 percent from 2020 levels by 2030, which, if met, would potentially prevent a 0.36 degrees Fahrenheit increase in temperature by 2050. More than 150 countries have now endorsed this commitment. During COP28, major methane-emitting nations provided additional details on their strategies for regulating methane, including the implementation of new monitoring equipment to detect methane leaks, technology to capture escaping gases, cessation of practices like flaring, and rigorous inspections to ensure compliance. Additionally, participating countries agreed to contribute $1 billion to support initiatives aimed at reducing methane emissions.

The private sector stepped up as well, with fifty oil and gas companies pledging to reach near zero methane emissions by 2030 and to submit a plan to meet those targets by 2025. A fund was also announced for methane abatement projects in emerging markets and developing economies. The companies also agreed to net zero greenhouse gas emissions from their operations by 2050.

Carbon offset negotiations failed

No deal was reached in talks to establish new rules allowing for the launch of a central system for countries and companies to begin offsetting their carbon emissions and trading those offsets after the deal was rejected by the European Union, Mexico, and the Latin American Ailac bloc. Reuters reported that the EU was pushing for rules that would put carbon offsets in line with the high standards set by its own emissions trading system and give the centralized oversight body less discretion in decision-making. It also wanted additional oversight on bilateral trading.

The technical working groups will now begin negotiating again in 2024, with the next chance for a deal at COP29, in Azerbaijan in 2025.

Why it matters

Following COP28, national policymakers will now look to implement these climate priorities through legislative and regulatory efforts. Companies must closely monitor this process to assess the impact on their industries. Businesses across industries will need to carefully evaluate their supply chains, including the agricultural and natural resources they rely on and the by-products and impacts of those processes. While the oil and gas industry took the spotlight at COP28, the future will be marked by global efforts to curtail the impacts of industrialization, bringing increased legal and reputational risks associated with poor sustainability practices across all sectors of the economy.