In my podcast series, “Environmental Insights: Discussions on Policy and Practice from the Harvard Environmental Economics Program,” I’ve had the pleasure of engaging in conversations over the past four years with a significant number of truly outstanding economists who have carried out important work in the realm of environmental, energy, and resource economics, and have been real leaders in the profession. In my most recent podcast, we topped that, because I was joined by someone who has made important contributions not just in the realm of environmental and resource economics, but has been a global leader in the discipline of economics broadly, across numerous sub-fields, and has ventured and published well beyond economics in seemingly disparate realms, ranging from contract bridge to Italian Rennaisance painting. All in all, he is the author or editor of 14 books and more than 300 scholarly articles.
Near the beginning of our conversation, Richard laments a phenomenon he terms “the pumped equilibrium,” in which people hold exaggerated expectations about confronting the challenge of climate change if we do not drastically increase our efforts.
“People started at least three decades ago saying, ‘Climate change is a terrible problem, but we can control it by cutting back on our greenhouse gases, and this is the last decade that we can do that. If we don’t do it this decade, we’re dead.’ And then, the next decade they said … the same thing. And this decade they’re saying … the same thing. And they keep telling us that we’re going to be able to [limit the global temperature increase to] two degrees centigrade above pre-industrial levels, or even more recently, 1.5 degrees centigrade above pre-industrial levels. I think that’s unrealistic.”
Richard maintains that instead a realistic assessment of the current state of climate change requires new approaches to make an impact.
“The United States has done a so-so job of cutting our emissions by about 10 percent over a number of years, but at the same time, China has increased its emissions by 13 percent, and you can expect that countries like India will be growing much faster in its emissions [levels],” he remarks. “So, I think that we should take a sober look at these problems and say, ‘What else can we do?’”
Climate adaptation, Zeckhauser states, holds the potential for greatly reducing the impacts of climate change. He cites one example in which scientists have proposed building a 100-foot-tall berm around a fjord in Greenland where warm water currently flows in and melts the ice sheets.
“This is very speculative. Will this work? I sure hope so. It’s within our realm of technological capability, but I think we should be looking for many solutions like this that could enable us to deal with … what I consider to be [the] catastrophic track that we’re on,” he says. Other potentially effective adaptation measures, he states, include increasing the alkalinity of the oceans and enforcing smarter logging policies to protect mature trees.
When I question Richard about the distributional implications of climate change, he remarks, “I think dealing with climate change and reducing its impact will automatically have very beneficial distributional consequences. The places that are currently suffering the most from climate change are the hottest places in the world, which are both suffering under [rising] temperatures and having their weather patterns shifted. So, you would be doing God’s work in restoring or preserving the planet, and you’d be doing work that’s to the benefit of the most affected people in the world.”
He also refers in this context to the challenges posed by massive migrations of people who want to escape rising temperatures in the south by heading north.
“Those [migration patterns] are very uncomfortable for the people in both places – the people who have to do the migration, which is frequently very dangerous and expensive, the people who are still trapped in the old place because they don’t have enough resources, and the people whose areas are being affected by the new people who are coming.”
Zeckhauser says that ultimately, it is up to policymakers around the world to confront the climate change challenge.
“This is a political problem on a global scale. So, even if you didn’t want to worry about it, as a political actor, as the president of the United States has to be and our climate envoy has to be, and the UN has to be, you have to pay serious attention to it.”
My conversation with Richard Zeckhauser is the first episode of 2024 and the 57th episode over the past four years of the Environmental Insights series, with future episodes scheduled to drop each month. You can find a transcript of our conversation at the website of the Harvard Environmental Economics Program. Previous episodes have featured conversations with:
David Keith, professor at Harvard and a leading authority on geoengineering
Joe Aldy, professor of the practice of public policy at Harvard Kennedy School, with considerable experience working on climate change policy issues in the U.S. government
Scott Barrett, professor of natural resource economics at Columbia University, and an authority on infectious disease policy
Rebecca Henderson, John and Natty McArthur University Professor at Harvard University, and founding co-director of the Business and Environment Initiative at Harvard Business School.
Sue Biniaz, who was the lead climate lawyer and a lead climate negotiator for the United States from 1989 until early 2017.
Navroz Dubash, Professor, Centre for Policy Research, New Delhi.
Paul Joskow, Elizabeth and James Killian Professor of Economics emeritus, MIT.
Maureen Cropper, Distinguished University Professor, University of Maryland.
Orley Ashenfelter, the Joseph Douglas Green 1895 Professor of Economics, Princeton University.
Jonathan Wiener, the William and Thomas Perkins Professor of Law, Duke Law School.
Lori Bennear, the Juli Plant Grainger Associate Professor of Energy Economics and Policy, Nicholas School of the Environment, Duke University.
Daniel Yergin, founder of Cambridge Energy Research Associates, and now Vice Chair of S&P Global.
Jeffrey Holmstead, who leads the Environmental Strategies Group at Bracewell in Washington, DC.
Daniel Jacob, Vasco McCoy Family Professor of Atmospheric Chemistry & Environmental Engineering at Harvard.
Michael Greenstone, Milton Friedman Distinguished Service Professor of Economics, University of Chicago.
Billy Pizer, Vice President for Research & Policy Engagement, Resources for the Future.
Daniel Bodansky, Regents’ Professor, Sandra Day O’Connor College of Law, Arizona State University.
Catherine Wolfram, Cora Jane Flood Professor of Business Administration, Haas School of Business, University of California, Berkeley, currently on leave at the Harvard Kennedy School.
James Stock, Harold Hitchings Burbank Professor of Political Economy, Harvard University.
Mary Nichols, long-time leader in California, U.S., and international climate change policy.
Geoffrey Heal, Donald Waite III Professor of Social Enterprise, Columbia Business School.
Kathleen Segerson, Board of Trustees Distinguished Professor of Economics, University of Connecticut.
Meredith Fowlie, Professor of Agricultural and Resource Economics, U.C. Berkeley.
Karen Palmer, Senior Fellow, Resources for the Future.
Severin Borenstein, Professor of the Graduate School, Haas School of Business, University of California, Berkeley.
Michael Toffel, Senator John Heinz Professor of Environmental Management and Professor of Business Administration, Harvard Business School.
Emma Rothschild, Jeremy and Jane Knowles Professor of History, Harvard University.
Having returned from Dubai a few days ago (the 16th COP I’ve attended), in this essay I step back from the headlines, offer my personal assessment of what happened at COP-28 (and what didn’t happen), reflect on the importance of China-USA cooperation (and sometimes co-leadership), describe the surprising evolution of the role of civil society in these annual Conferences of the Parties, delve into this year’s striking focus on methane emissions, highlight a couple of disappointments at the COP, briefly summarize Harvard’s extensive participation, and offer some closing thoughts about the path ahead.
Behind (and Beyond) the Headlines
COP-28, in my judgment, was successful, but not in the way success has been characterized in most articles I’ve seen. In the end, the above endorsement of “transitioning away from fossil fuels” (instead of language proposed by greener interests of “phasing down” or even “phasing out” fossil fuels) combined with the endorsement of “accelerating zero- and low-emission technologies, including … renewables, nuclear, abatement and removal technologies such as carbon capture and utilization and storage …” was sufficient to win the approval of the wealthy oil-producing countries in the Middle East, the large multinational energy companies (who have come to recognize that global movement away from fossil fuels is all but inevitable), the industrialized world, and developing countries. (I should also recognize that many commentaries have also praised the closing statement for endorsing the tripling of global renewable-energy capacity, doubling of the annual rate of energy-efficiency improvements, and “accelerating and substantially reducing non-carbon-dioxide emissions globally, including in particular methane emissions by 2030” – more about methane below.)
But, having participated in these annual UNFCCC Conferences of the Parties for 16 years, I don’t think the most important outcome of COP-28 is what is contained in that closing statement, which is essentially a non-binding resolution about future ambitions. I say this despite my recognition that the closing statement about fossil fuels and – more importantly – the press coverage it has received may have some symbolic, signaling value, and can “normalize ideas and measures once seen as too radical to be globally agreed.” Indeed, that statement has gotten the lion’s share of press attention, because the press and many others like to characterize these annual COPs as either “successes” or “failures,” and the closing statement provides a very convenient focal point.
The reality is that the negotiations at most COPs are neither successes nor failures (except perhaps when a new international agreement is enacted, as with the Kyoto Protocol in 1997, and the Paris Agreement in 2015, both legally binding international treaties). Naming any of the negotiations at the twenty-six other COPs as successes or failures makes no more sense than it would to characterize the annual World Economic Forum meetings in Davos as successes or failures. Both are extensive, complex get-togethers, based on bottom-up processes. It is not as if the corporate CEOs meeting in Davos agree to take action, and then go home to their respective Boards of Directors to implement their Davos commitments. The causality runs in precisely the opposite direction. So too with the annual COPs, where the delegations of the various “Parties,” the 195+ countries, bring with them their predisposed domestic priorities and perceptions of acceptable “international cooperation.” Each COP’s official outcome is essentially the aggregation of those.
What will drive meaningful action around the world – that is, massive cuts in greenhouse gas (GHG) emissions – is the combination of market realities and public policies (with both having impacts on the other). The most important public policies – whether carbon taxes, cap-and-trade instruments, performance standards, or technology standards – have been and will be enacted at the national level, the regional level in the case of the European Union, and sometimes the sub-national level (for example, California). Those policy developments are linked with what happens at the annual COPs, but the direction of causation is fundamentally bottom-up, not top-down.
The Most Important COP-28 Development
Ever since Donald Trump became President of the United States, a major question has been when would the United States and China return to the highly effective co-leadership roles they played during the years of the Obama administration in the runup to the Paris Agreement. This was an important question at COP-26 in Glasgow in 2021, but it turned out that last year’s COP-27 provided an answer, although in somewhat surprising fashion.
As I wrote at the time (including in a post at this blog), the most important development during COP-27 held November 7-20, 2022 in Sharm El-Sheikh, Egypt, took place 6,000 miles away in Bali, Indonesia, when U.S. President Joe Biden and China President Xi Jinping met on November 14, 2022, on the sidelines of the G20 summit, shook hands, and engaged in a three-hour conversation in which, among other topics, they signaled their return to the cooperative stance that had previously been so crucial for international progress on climate change. That three-hour meeting marked the end of the breakoff of talks that had been initiated by China in response to Speaker Nancy Pelosi’s trip to Taiwan in early August of that year. The two leaders expressed their intention to not allow disagreements regarding international trade, human rights, movement away from democracy in Hong Kong, and Taiwan’s security to contaminate their cooperation on climate change.
The discussion between the two heads of state quickly (and explicitly) trickled down to the heads of the respective negotiating teams at COP-27 — John Kerry of the United States and Xie Zhenhua of China. They are longtime friends, but had not been engaged in discussions or cooperation on climate change because of the problems that had existed at the highest level between the two governments. But, after the Biden-Xi meeting in Bali, statements from both John Kerry and Xie Zhenhua indicated that the two countries would resume cooperation. I expressed hope at the time that there might even be a return to the co-leadership on climate change policy which China and the United States had previously exercised and which had disappeared long before Pelosi’s trip to Taiwan, namely with the beginning of the Trump administration and throughout much of the first two years of the Biden administration.
However, it was not until very recently that it became clear that China and the USA might truly resume cooperation and co-leadership, and that was two weeks before COP-28, when the most important development for COP-28 (Dubai) took place 8,000 miles away, in Sunnylands, California, when the same two heads of state met and signaled in even more certain terms (and in writing in their “Sunnylands Statement”) their renewed cooperation on climate change. It’s not news that U.S.-China cooperation is essential for meaningful progress on climate change, and the reality is that the Sunnylands Statement — jointly signed by the two presidents in November, 2023 – is ultimately more important than any individual accomplishments at COP-28 in Dubai.
Important Context for Change: Surprising Evolution of the Annual COPs
It is helpful for a full understanding of what happened at COP-28 to reflect on the evolution of the annual COPs since they began with COP-1 in Berlin in 1995, or at least over the 16 years that I’ve been attending these festivities as the leader of Harvard’s delegation, beginning with COP-13 in Bali, Indonesia, in 2007.
In fact, we need to begin even before COP-1 in 1995, with the UN conference that took place in Rio de Janeiro, Brazil, in 1992 and that produced the UNFCCC. The text specifies (in paragraph 6 of Article 7) something quite unusual for a process of ongoing international negotiations, namely that “any body … whether … governmental or non-governmental, which is qualified in matters covered by the Convention, and which has informed the secretariat of its wish to be represented at a session of the Conference of the Parties as an observer, may be so admitted…” Thus, there is an explicit role for observer organizations – largely from civil society (environmental NGOs of all kinds, trade associations, universities, etc.) – in the annual “Conference of the Parties” of the UNFCCC.
Over time, there were at first gradual and more recently quite dramatic changes in the relative importance and prominence of the core country delegations of negotiators (typically about 10,000 people) versus “observers” from civil society (recently about 30,000 to 40,000 people, reaching 70,000 at COP-28 in Dubai). When I first participated in the COPs 16 years ago, I would say that 90-95% of the meaningful action was in the negotiations, with 5-10% among the participants from civil society.
But by the time of COP-28 this year, I would peg 10% of the meaningful action as being within the negotiations, and 90% among the myriad events (including official “Side Events,” unofficial presentations and sessions, meetings, and interactions of all kinds) among participants from civil society. Except when there is a legal agreement to be negotiated (Kyoto, Paris), most action is simply outside of the negotiations. You can think of the COP as a circus in which the “main event” is eclipsed with increasing frequency by the “side shows.”
In the words of Somini Sengupta, writing in the New York Times, during COP-28, “there are two climate summits taking place in Dubai. One is the gathering of bleary-eyed, sharp-tongued diplomats parsing over every word and comma” in the closing statement, but “the bigger event is happening outside the negotiating rooms. It’s part trade fair, part protest stage, part debate forum.” Included in the “trade fair” were battery entrepreneurs, solar panel manufacturers, venture capitalists, financial brokers, mining executives, real estate developers, tech startups, green cement manufacturers, construction companies, global food suppliers, fertilizer producers, pharmaceutical companies, and representatives of dozens of other sectors.
Hence, I christened this year’s festivities in Dubai, “Climate Expo 2023.” I don’t say this with cynicism or even skepticism, because I recognize, as I stated above, that this is a bottom-up process like the World Economic Forum in Davos each year, and like Davos, the Climate Expo plays a role, indeed a potentially important one. Great examples of this in Dubai were in the form of events targeting a specific non-CO2 greenhouse gas – methane.
Methane
Something that was very striking at COP-28 was the degree to which methane emissions received greatly increased attention, not necessarily in the negotiations, but in the multitude of discussions and side agreements forged and publicized among governments (the Global Methane Pledge to cut emissions by 30% by 2030) and – importantly – among diverse members of civil society, including business associations, environmental NGOs, and academics. This was a dramatic change from COP-27, just one year ago. I’m pleased to say that our Harvard delegation was a major contributor to this, with the Salata Institute’s Initiative on Global Methane Emissions Reduction, which I have the privilege and pleasure of directing. (More about that below, where I summarize Harvard’s work at COP-28.)
Also at COP-28, the United States, China, and the UAE held a methane summit, which featured a series of relevant pledges. And the World Bank focused on its Global Flaring and Methane Reduction Partnership, as well as the Global Methane Hub launching its Enteric Fermentation Accelerator. In addition to the $1 billion in new grant funding noted above, international financial institutions approved more than $3.5 billion in new investments in methane-reducing projects since COP-27.
Of potentially greater importance, a large group of leading oil and gas companies pledged to achieve near zero methane emissions by 2030, and to completely eliminate routine flaring by the same year. The Oil and Gas Methane Partnership 2.0 now counts 120 companies with operations in 60 countries, covering 35% of world oil and gas production, and more than 70% of LNG flows. Linked with this, the Oil and Gas Climate Initiative (OGCI) expanded it Satellite Monitoring Campaign.
Of course, if the venting/flaring can be reduced/eliminated at reasonable cost, it is very much in the interest of these oil and gas companies to do so, since it means keeping more of a merchantable product in the pipeline for sale. But that does not detract from the potential importance of the initiatives. More broadly, whether these multiple pledges and actions from private industry, civil society, and governments will result in real emission reductions will ultimately depend on adequate measurement, reporting, verification, and enforcement, which are among the targets of the research and outreach that constitute the Harvard Initiative to Reduce Global Methane Emissions (see below).
A Couple of Disappointments at COP-28
Adaptation to climate change that is already taking place and will continue to take place regardless of actions to mitigate emissions received a great deal of attention with 84 uses of the word in the COP-28 Decision, but there are no actionable commitments. Indeed, it seems that the progress made last year at COP-27 on creating a fund for Loss and Damage, and financial contributions to the fund announced at COP-28, which reached $700 million, may have diverted attention and action away from the Adaptation Fund. That said, it should be recognized that the total now pledged for supplying the Loss and Damage Fund amounts to much less than 1% of what the eventual demand is likely to be.
I turn next to a summary of some of the work of our Harvard delegation at COP-28, and then conclude with some closing thoughts about COP-28 and the path ahead.
Reducing Global Methane Emissions: Imperatives, Opportunities, and Challenges – This official Harvard Side Event featured several leading scholars and climate policy experts who discussed current research and practice on technology, policy, and international cooperation, drawing in part on Harvard’s major new methane initiative supported by the Salata Institute for Climate and Sustainability at Harvard University. Professor James Stock, Director of the Salata Institute, offered welcoming comments; and then I moderated a discussion among: Claire Henly, Senior Advisor for Non-CO2 greenhouse gases, U.S. Special Presidential Envoy for Climate; Daniel Jacob, Vasco McCoy Family Professor of Atmospheric Chemistry and Environmental Engineering, Harvard University; and Helena Varkkey, Associate Professor of Environmental Politics and Governance, Universiti Malaya and Principal Investigator, UM-CERAH-EDF initiative on methane emissions in Malaysia. There’s an abridged video of the Side Event here.
Net Zero in Action: Showcasing Decarbonization Technologies – I provided the keynote address at an IPIECA event, held at the Pavilion of the International Emissions Trading Association.
Transforming High Global Warming Potential Sectors through Carbon Markets – I made a presentation on “The Promise and Peril of GHG Markets for Reducing Global Methane Emissions,” in a panel at the Asian Development Bank Pavilion.
Application of Low Emission Development Strategies and Progress of Global Energy Transition – I made a presentation on “Comparing Carbon Taxes and Emissions Trading” at the Ninth Global Climate Change Think Tank Forum, hosted by China’s National Center for Climate Change Strategy and International Cooperation, in the China Pavilion.
“Linking Agendas of the UNFCCC and the World Health Assembly – Regional perspective,” in the Guatemala Pavilion.
“Linking Agendas of the UNFCCC and the World Health Assembly – Global perspective,” in the World Health Organization Pavilion.
There were also a significant number of Harvard College and Harvard graduate students in attendance.
Closing Thoughts and the Path Ahead
First, “COP-28 was a coming-out party for private sector climate action,” to use the phrase of Nat Keohane, president of C2ES. As I noted above, hundreds of companies from very diverse sectors – including but by no means limited to energy generation (fossil and renewable) – were present to showcase technologies, management practices, adaptation, and finance in support of fulfilling the promise of the Paris Agreement, and the UNFCCC more broadly. For some observers, this was a distinctly negative aspect of COP-28, while others (including myself) found the participation of private industry to add to the diversity, the meaningful contributions, and perhaps the pragmatism of COP-28.
Second, COP-28 completed the first 5-year Global Stocktake. Countries are to submit their next round of Nationally Determined Contributions (NDCs) under the Paris Agreement prior to COP-30 in 2025.
Third, COP-28 was a logistical success, with an excellent venue, with real buildings, not temporary structures. It was spread over an area larger than New York City’s Central Park, but the weather was perfect (albeit on the warm side)!
However, it’s not clear that such positive statements can be said about the locations of the next two COPs. COP-29, set for November 11-24, 2024, will take place in Baku, Azerbaijan (where, by the way, the oil and gas industry constitutes two-thirds of GDP), and COP-30 will take place November 10-21, 2025, in Belém do Pará in the Amazon region of Brazil.
Whether I will maintain my streak of annual COP participation is, as always, an open question.
