A final deal was approved at the UN's Climate Conference in Glasgow Nov. 13 after a late objection by India on the phase out of coal-fired power was reluctantly accepted.
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The final text now calls on countries to accelerate the "phase-down" of unabated coal-fired power rather than its "phase-out" after both India and China lobbied for the change. Coal makes up 65% of China's and 71% of India's power generation mix.
"Developing countries have a right to their fair share of the global carbon budget and are entitled to the responsible use of fossil fuels," Indian Environment Minister Bhupender Yadav told the conference in a late intervention.
"How can anyone expect developing countries to make promises about phasing out coal and subsidies for fossil fuels when those countries have still to deal with their development agendas?" the minister asked.
India's policy, for instance, included "much-needed" subsidies for liquid petroleum gas use in low-income households, reducing the dangerous use of biomass burning for cooking, Yadav said.
The final text also calls on the accelerated phase-down of inefficient fossil fuel subsidies.
Formally gaveling through the Glasgow Climate Pact, COP26 President Alok Sharma said he understood the "deep disappointment" of most countries at the climb-down on coal, but this was "vital" to protect the overall package.
This included a request for all countries "to revisit and strengthen the 2030 targets in their nationally determined contributions as necessary to align with the Paris Agreement temperature goal by the end of 2022."
The need to return almost immediately to the table underlined the fact that the Glasgow package was just work-in-progress with much more needed to be done, Sharma said.
"I believe 1.5 degrees remains in reach but its pulse is weak and it will only survive if we keep our promises, translate commitments into rapid action and close the vast gap that remains," he said.
Paris Rulebook approved
Also approved at the COP26 talks were key rules on global carbon markets, on common timeframes and on transparency.
"These put in place the rules and systems to keep us accountable and support increased ambition. Their resolution will unleash the full force of what was agreed in Paris," Sharma said.
While final texts were still to be published, final drafts showed the use of Clean Development Mechanism credits (CERs) would be limited to those issued from 2013 onwards, with a mandatory use of 5% of carbon credit proceeds for adaptation purposes in developing countries.
"The current deal limits the carry over of CDM to credits from the second commitment period of the Kyoto Protocol and limits their use to the first NDC cycle," said Kelley Kizzier, vice president for global climate at US-based non-governmental group Environmental Defense Fund.
The end result was about 100 million credits carried over, Kizzier told S&P Global Platts -- "not an ideal result, but not the worst trade off to get robust international accounting rules in place."
Final texts also included a package preventing all forms of double counting of carbon credits for compliance markets, Kizzier said.
CORSIA-eligible carbon credit (CEC) prices have increased by 944% this year and were assessed at $8.35/mt CO2e at the close Nov. 12, according to S&P Global Platts assessments, compared with 80 cents/mt when the assessment was launched Jan. 4.