COP28 Success and Challenges revealed: A Business Travel Perspective

A diplomatic success (as always)

One could argue that a meeting of the Conference of Parties (COP) is a success before it even begins. It is a platform for international cooperation and often offers small countries the access to address a global audience that they might not otherwise have. For example, this year at COP28, we again heard the pleas of small island states in the Pacific as they face the very real effects of climate change in their countries. The COP strives to give these small states a voice - something they don’t have in other large organizations and meetings, like the World Trade Organization (WTO), Davos, or the G20.

We can also attribute this year’s success to Sultan Al Jaber, President of the COP. His credibility to lead a conference on climate change is somewhat undermined by the fact that is the Minister of Industry for a nation whose economy is nearly solely based on oil exports, but he ultimately managed to reach a significant and unexpected agreement just hours before the closing of this year’s event. Initially, under the influence of the Organization of the Petroleum Exporting Countries (OPEC), the final consensus appeared vague, void of substance, and lacking ambition. However, we saw a significant turnaround towards the end. Let’s dive in!

Voldemort is unmasked…

As surprising as it may seem, previous COPs have never explicitly addressed fossil fuels in the final consensus. However, this year we finally saw an official decision to transition away from fossil fuels. This is no small victory, proving once and for all that fossil fuels are responsible for climate change, and that we must ultimately embrace alternatives.

While this is probably the most significant outcome from COP28, there were some other big decisions in the consensus, such as the creation of a loss and damage fund (which places the responsibility of the climate crisis on countries contributing the most emissions), a plan to triple renewable energy production by 2030, and even the creation of a “Health” day, which clearly links climate change and health (remember that fossil fuels kill 5 million people each year). But let’s continue to focus on the most significant outcome: the shift away from fossil fuels.

… but he has a secret weapon

Even as we take steps in the right direction, the “secret weapons” proposed to combat the use of fossil fuels, Carbon Capture and Storage (CCS) and Direct Air Capture, (DAC) seem to miss the mark. This is probably the biggest drawback of this year’s COP, which put the spotlight on these technologies that haven’t yet proven to be scalable enough to make a significant impact. Despite promises and billions of dollars invested over the past 25 years (we were already talking about CCS in Kyoto in 1997!), only around thirty installations exist in the world, capturing around 45 million tons of carbon per year - only 0.12% of global emissions. But in addition to this unsatisfactory performance, CCS real negative effect is that it enables extremely polluting activities to persist (such as a coal-fired power station), provided that there is a plan to install the CO2 vacuum cleaner (the CCUS). Thus, the financial value of such assets (like power plants) remains steady, which hinders investments toward more environmentally friendly alternatives. In many respects, both DAC and CCS are “enablers” of the oil companies, who continuously lobby to keep fossil fuels front and center.

This is a real step backward, in addition to other discouraging news, like the lack of binding measures for the countries involved, the promotion of gas as a transition energy, etc.

What does this mean for business travel?

Without being as pessimistic as French scientist Jean-Marc Jancovici ("the aviation sector was born with oil and will die with oil"), it is obvious that abruptly ending the use of fossil fuels is unfeasible for a sector burning 14,000 liters of oil per second. However, there are opportunities that the industry can and should seize to make a change. For example, energy efficiency is currently a significant focus, with fleet renewal standing out as the sector's most effective solution. Plus, the rise of renewable energies is expected to benefit the hotel sector, and even electric cars.

On the other hand, it is difficult not to draw a parallel between the CCS and sustainable aviation fuel (SAF). Both seem appealing on paper, but they share a history of unfulfilled promises (recall IATA promised 10% SAF for 2017!) We anticipate similar results in the coming years as aggressive SAF targets face the physical realities of our planet, which we already are beginning to see today!

In Europe, there are strong suspicions regarding cooking oil imported from Asia since it’s very likely mixed with palm oil. Meanwhile, in the United States, lobbying efforts are underway to permit the use of first-generation biofuels (e.g. corn and not waste) to produce SAF. Additionally, there are emerging technologies, like low carbon aviation fuel (LCAF) – which is basically marginally improved kerosene; a logical solution when we realize the immensity of the resources necessary to produce SAF.

Being optimistic, we can hope that the objectives set by the European Union will never be scaled back or reversed, because the only solution to achieve them would probably be for airlines to reduce their fleets. Then the question of “managing demand” will emerge.

But that will be for another COP!