Will COP28’s Climate Fund Promises Become a Reality?

When there’s a global crisis, wealthy countries tend to find money.

That was the case in the United States when big banks were bailed out to soften a global financial crisis. That was the case for the coronavirus pandemic. And for military aid to allies like Ukraine.

But the climate crisis? It’s complicated.

This weekend, Vice President Kamala Harris visited the United Nations climate summit in Dubai, in the United Arab Emirates, and promised $3 billion for the Green Climate Fund, which benefits poorer nations. But Biden administration officials already are acknowledging it will be a struggle to persuade Congress to approve the money.

A day after that, John Kerry, President Biden’s climate envoy, announced at the talks a new carbon credit initiative in which more than a dozen major companies including Walmart, Pepsi and McDonalds will help developing countries pivot away from fossil fuels toward renewable energy. The creation of the program is a tacit acknowledgment that governments simply aren’t putting up the trillions of dollars needed to fund the energy transition.

One of the big tests facing this summit, known as COP28, is whether it will fare any better than earlier climate talks at shoring up anything close to the money that’s needed.

None of what is being discussed and promised at the meeting — whether it’s tripling of renewable energy, adapting to the hazards of a hotter world, or compensating countries for the irreparable losses of climate change — can happen without huge sums of money. Not to mention the mounting frustration of leaders from the global south over unkept promises of aid. Money is crucial to restoring confidence.

“The world needs long-term money,” the prime minister of Barbados, Mia Mottley, said on Saturday in a statement on behalf of a coalition of climate-vulnerable countries. “We give thanks to the progress made but it does nothing but assuage consciences. Choosing between people and the planet is a false choice. The world has enough funds.”

One of the biggest shortfalls is for funds that would help developing countries cope with climate impacts, like rising sea levels and extreme heat. A United Nations report concluded recently that rich countries had reduced their aid for climate adaptation efforts between 2020 and 2021, the most recent year for which comprehensive data is available.

All the while, the needs of those developing countries have grown sharply. Countries promised to double adaptation aid at the U.N. climate summit in Glasgow in 2021. Even if that happens, it comes nowhere close to meeting the need: an estimated $215 billion to $387 billion a year between now and 2030 for climate adaptation alone. That’s 10 to 18 times as much as the current public finance flows, the United Nations report found.

The effort to triple renewable energy worldwide requires ratcheting up clean energy spending to $4.5 trillion in annual investment, from $1.8 trillion today, by 2025, according to the International Energy Agency, particularly in energy-hungry emerging economies and poor countries.

“The reality is that without much more finance flowing to developing countries, a renewables revolution will remain a mirage in the desert,” said Simon Stiell, the chief of the U.N. climate change agency, at the opening of the conference. “COP28 must turn it into a reality.”

This year, climate negotiations have already brought some progress. The $100 billion in annual climate aid that rich countries had agreed to shore up by 2020 came through, three years late. Countries approved a new fund to compensate poor countries for the losses and damages they are witnessing already, but that is, for now, voluntary. Right now, there’s about $420 million in the kitty.

Jennifer Morgan, Germany’s climate envoy, said in an interview that she had detected a positive shift in the dynamics since her country announced $100 million for the loss-and-damage fund.

“It enabled developing countries to focus on other agenda items here,” Ms. Morgan said, adding, “It builds trust with them, and this process is all about trust.”

At the start of the talks last week, the United Arab Emirates, the oil-rich host, announced a new $30 billion fund aimed at drawing billions more in private investment, including from the world’s biggest financier, BlackRock.

But the United States, the world’s largest economy and the world’s biggest climate polluter in historical terms, is facing intense pressure at the summit to step up its public financing.

Biden administration officials at climate summit insisted that the U.S. president is committed to securing climate aid for the developing world. Mr. Biden has pledged to deliver $11.4 billion annually in climate assistance by 2024, and officials this week said that the administration was on track to deliver more than $9 billion this year.

Much of that money is allocated through the World Bank and other multilateral climate funds, as well as loans and other financing for clean energy projects through agencies like the U.S. International Development Finance Corporation. Over the past three years, that agency’s annual climate finance commitments have grown to more than $3.7 billion from less than $500 million, the administration said in a fact sheet.

The Biden administration also put $1 billion into the Green Climate Fund, but only by drawing on discretionary funds within the State Department after Republicans blocked a direct allocation.

The big question for the United States now is whether a divided Congress or a future administration can deliver on the Biden administration’s newest promises.

“The problem is, the U.S. is not a reliable partner,” said Mohamed Adow, director of Power Shift Africa, an environmental group. “It’s been three years since Biden entered the White House and we haven’t seen much in terms of previous finance promises.”

Republicans, who control the House, are overwhelmingly opposed to international climate aid, and have repeatedly slashed Mr. Biden’s requests. Congress approved just $1 billion of the president’s $11 billion request for global climate assistance for the fiscal year 2023. Former President Donald J. Trump, Mr. Biden’s likely challenger for the 2024 election, pulled the United States out of the Paris Agreement and ended all payments to the Green Climate Fund.

Some lawmakers are already preparing for a fight. Senator John Barrasso, Republican of Wyoming, said he believed the United States should not “spend another penny on crooked U.N. slush funds.”

“We’re still working to get the $11 billion,” John Podesta, a top White House climate adviser, said. “It takes a lot of work with this current Congress to do that, but we’re hard at it.”

And yet the Biden administration also has made choices. When the president drew up a list of multibillion-dollar priorities in October that he said required urgent approval from Congress, he chose military aid to Israel and Ukraine, arming Taiwan and increasing security along America’s southern border.

Then the White House issued a second plea: to fund natural disaster response in the United States, child care centers and high-speed internet. Money to help the world’s poorest countries cope with global warming did not make the cut.

Mr. Podesta said international climate finance was not listed in that supplemental request because it was focused on “critical priorities that we think can pass this Congress, and certainly have bipartisan support, really, in both houses.”

David Victor, a nonresident senior fellow at the Brookings Institution, a Washington think tank, was more blunt.

“Transferring funds to other countries is not very popular in the United States right now,” he said. He noted that the emergency aid package to Israel and Ukraine had not yet won approval because House Republicans were still negotiating over changes to U.S. border policy.

“The country has turned inward,” Mr. Victor said. “It’s turned populist and it is at best trying to fund these two very expensive wars. And even that is challenging.”