COP27: Negotiators reach tentative agreement on ‘loss and damage’ at UN climate summit.

Sharm el Sheikh, Egypt

Despite a major breakthrough on Saturday, the international climate negotiations at the UN climate summit COP27 dragged on until early Sunday morning.

The final plenary session of this year’s COP is scheduled to begin at 3 a.m. Egyptian time, according to a notice from the United Nations Framework Convention on Climate Change.

For the second straight year, the marathon negotiations continued well past their scheduled end as countries attempted to hammer out stronger language for phasing out all fossil fuels, including oil and gas, rather than just unabated coal, according to several NGOs supporting the observed conversations.

Elsewhere progress has been made. The parties reached a tentative agreement on Saturday to set up a “loss and damage” fund for nations at risk from climate-related disasters, according to negotiators with the European Union and Africa, as well as non-governmental organizations monitoring the talks.

The United States is also working to sign an agreement on a loss and damage fund, Whitney Smith, a spokeswoman for US climate change agent John Kerry, confirmed to CNN.

The fund will focus on what can be done to support resources for loss and damage, but does not include liability or indemnification provisions, a senior Biden administration official told CNN. The US and other developed nations have long sought to avoid such regulations, which could expose them to legal liability and lawsuits from other countries.

If completed, it could mark a major breakthrough in negotiations on a contentious issue – and it’s seen as a reversal, as the US has resisted efforts to set up such a fund in the past.

It’s not all settled yet – an EU source directly involved in the negotiations warned earlier on Saturday that the deal is part of the larger COP27 deal, which has to be approved by nearly 200 countries. The negotiators worked through the night until Sunday. And other issues, including language surrounding fossil fuels, remain, according to several NGOs monitoring the talks.

But progress has been made, the source said. In a discussion on Saturday afternoon Egyptian time, the EU managed to get the G77 bloc of countries to agree to target the fund at vulnerable nations, which could pave the way to an agreement on losses and damages.

The deal, if finalized, would represent a major breakthrough on the international stage, far exceeding expectations at this year’s climate summit, and mood among some delegates was boisterous.

Countries most vulnerable to climate disasters — but which have contributed little to the climate crisis — have struggled for years to secure a loss and damage fund.

Developed nations, which historically produced the most emissions to warm the planet, were reluctant to sign a fund they believed could open them to legal liability for climate disasters.

Details on how the fund would work remain unclear. The preliminary text says a fund will be set up later this year, but it leaves many questions about when it will be completed and operational, climate experts told reporters on Saturday. The text speaks of an interim committee that will help finalize these details, but does not set future deadlines.

“There are no guarantees on the timing,” Nisha Krishnan, director of resilience at the World Resources Institute Africa, told reporters.

Proponents of a loss and damage fund were happy with the progress but noted that the scheme was less than ideal.

“We’re pleased with this result because it’s what developed countries wanted — if not everything they came here for,” Erin Roberts, founder of the Loss and Damage Collaboration, told CNN in a statement. “Like many others, I have been conditioned to expect very little from this process. While setting up the fund is certainly a win for developing countries and those on the frontlines of climate change, without funding it is an empty shell. It is far too little, far too late for those on the front lines of climate change. But we will work on it.”

At COP27, calls for a loss and damage fund – from developing countries, the G77 bloc and activists – had reached a climax, fueled by a series of major climate disasters this year, including the devastating floods in Pakistan.

The conference initially went into overtime on Saturday before continuing into the early hours of Sunday, with negotiators still working out the details while workers dismantled the venue around them. There was a real sense of fatigue and frustration in places. To make matters worse, Kerry – the top US climate official – is self-isolating after recently testing positive for Covid, working on the phone rather than meeting in person.

And earlier on Saturday, EU officials threatened to walk out of the meeting if the final deal doesn’t support the goal of limiting warming to 1.5 degrees Celsius above pre-industrial levels.

Global scientists have warned for decades that warming must be limited to 1.5 degrees – a threshold that is fast approaching as the planet’s average temperature has already risen to about 1.1 degrees. Beyond 1.5 degrees, the risk of extreme drought, wildfires, flooding and food shortages will increase dramatically, scientists said in the latest report from the United Nations Intergovernmental Panel on Climate Change (IPCC).

In a carefully choreographed press conference on Saturday morning, the EU’s Green Deal czar Frans Timmermans, flanked by a slew of ministers and other senior officials from EU member states, said that “no deal is better than a bad deal”.

“We don’t want 1.5 degrees to die here and now. This is totally unacceptable to us,” he said.

The EU made it clear that it was willing to agree to a loss and damage fund – a big shift in its position compared to just a week ago – but only in exchange for a strong commitment to the 1.5 degree target.

As the sun went down in Sharm el-Sheikh on Saturday night, the mood turned to cautious jubilation and groups of negotiators began to hint that an agreement was in sight.

But as is always the case with high-level diplomacy, officials were quick to stress that nothing is really agreed until the last gavel falls.

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