REUTERS IMPACT – Can COP26 Assist Developing Countries in Saving the World? By Reuters

By Kevin Liffey

(Reuters) – The COP26 global climate conference is unlikely to achieve its goal of shifting the world away from fossil fuels without significant support for developing economies that depend heavily on coal, experts indicated during a recent climate conference.

Usha Rao-Monari, an associate administrator with the U.N. Development Programme, highlighted that currently, less than 20% of global clean energy investments benefit the poorest two-thirds of the global population.

Despite a 20% reduction in greenhouse gas emissions from power plants in industrialized nations since 2012, coal—a particularly harmful energy source—still makes up 44% of power usage in emerging economies, which have seen their emissions rise by 20%.

Rao-Monari emphasized that of the estimated $90 trillion needed for infrastructure to meet the 2030 emissions targets, two-thirds should be directed to emerging countries. This funding is crucial to prevent these nations from making long-term investments in environmentally damaging coal-fired power plants, which may seem cheaper at first.

Makhtar Diop, managing director of the World Bank’s investment branch, pointed out that institutions like the International Finance Corporation (IFC) are striving to make green investments in developing economies more appealing to private investors. This includes creating innovative financial models to reduce the risks associated with green projects.

“I believe that future activities related to climate change will be viewed as significantly less risky than they have been in the past,” Diop remarked.

Inger Andersen, executive director of the U.N. Environment Programme, stressed the importance of the finance sector adopting a longer-term perspective to facilitate the transition away from fossil fuels. She noted that a global carbon market that accurately reflects the full costs of emissions would be beneficial, stating, “Right now, carbon is way too cheap; it’s ridiculous.”

Francesco Starace, CEO of Europe’s largest utility company, emphasized the necessity of ensuring that all individuals have access to clean and affordable electricity. He pointed out that the 800 million people currently lacking access to affordable energy are unlikely to prioritize climate issues when their basic need for power is at stake.

Spanish Energy and Environment Minister Teresa Ribera expressed hope that COP26 would strengthen the commitment of wealthy nations to provide $100 billion annually for the energy transition in developing countries, ensuring that funds are allocated to environmentally friendly initiatives. Although this financial pledge was first made at COP16 in 2009, the target date of 2020 has come and gone without the goal being realized.

Ribera also urged action regarding “loss and damage,” calling for an established framework for assessing liability and compensation for climate-related harm largely caused by wealthy, industrialized nations. “At the Glasgow conference, handling adaptation and loss and damage will be crucial to demonstrating our solidarity and credibility in providing solutions,” she stated.

Diop from the IFC added that mobilizing sufficient resources for nations facing challenges from desertification or coastal erosion is one of the significant hurdles for decision-makers at COP26.

As global business leaders and policymakers prepare for the upcoming talks in Glasgow, Scotland, discussions at the Reuters Impact conference focus on addressing climate change and promoting sustainable growth.

For Starace, who has dedicated years to transforming his utility into a green leader, a key issue for COP26 and beyond is whether the transition from fossil fuels will be swift and inclusive or marked by division. “Transitions typically are not inclusive; they tend to be divisive,” he remarked.