Each fall heralds a new attempt to catalyze climate ambitions and fortify green cooperation among the world’s biggest emitters and the nations most affected by climate change. The Conference of the Parties (COP), a set of annual climate talks conducted by the United Nations in late November and early December, offers the opportunity for these countries to commit to more ambitious goals.
While all countries bring their agenda and promise to the stage, significant pressure lies on the shoulders of Chinese delegates, as representatives of the largest emitter try to balance between national energy security concerns, the pledges to cut greenhouse gas (GHG) emissions, and the need to compensate for unavoidable climate change consequences. This year, a couple of weeks before the long-anticipated COP28 in Dubai, Chinese President Xi Jinping and U.S. President Joe Biden announced a new bilateral round of climate actions promising to triple renewable energy capacity, reduce all GHG emissions – including long-awaited commitments on methane – and promote a circular economy.
However, while international attention is on the bilateral pledges to ramp up climate diplomacy and achieve progress in curbing methane and enhancing renewables, there remains an implicit energy partnership between Russia and China, one that was reaffirmed during the Belt and Road Forum in October. This fossil fuel partnership between China with Russia could cast a shadow on the substantial progress that can be achieved at COP28. Specifically, geopolitical feuds and ambitions have dampened climate ambition, as states with high concentrations of fossil fuels seek to capitalize on fears of energy resiliency over meeting the goals of the Paris Agreement.
According to the report “Phasing down or phasing up?” composed by the leading climate organizations, including the U.N. Environment Program, SEI, Climate Analytics, etc., the 20 major fossil-fuel-producing governments still plan to increase extraction of coal, oil, and gas in the coming years, regardless of the Paris Agreement commitments and net-zero goals. The analysis specified that although listed countries have launched green initiatives, none is in line to limit global warming to 1.5 degrees Celsius by 2030, including the COP 28 host (UAE) and its participants – including China, Russia, the United States, and others.
Foreseeing the disconnect between the COP28 president’s position as CEO of the Abu Dhabi National Oil Company, and the conferences’ goals to raise climate ambitions, the European Union is pushing for a world-first agreement to phase out unabated fossil fuels. And though, or perhaps because, many leading fossil fuels companies and nations will be attending, U.N. Secretary-General Antonio Guterres warned: “We must make up time lost to foot-dragging, arm-twisting and the naked greed of entrenched interests raking in billions from fossil fuels.”
Nevertheless, profit and economic interests prevail in decision-making. China is part of this worrying trend. It has pledged on the one hand to reverse its status of the most emitting country in the world, but on the other hand, signed new fossil fuels import agreements with Russia in an attempt to ensure energy security. By buying sanctioned coal and oil from Russia at heavily discounted prices, China is not only rebelling against international pressure on Russia but also seizing an opportunity to boost the factors of its economic growth that are heavily reliant on coal production.
Just two months ago, China’s climate envoy, Xie Zhenhua, confirmed the securitization of the climate agenda by stating that “completely phasing out fossil fuel is unrealistic”. Indeed, despite the ambitious climate goals announced after the California talks with the United States, China is not abandoning the idea of the joint development of Russia’s oil and gas fields, supporting partnerships between leading Russian companies such as Rosneft, Gazprom, and Novatek with China National Petroleum Corporation (CNPC).
While Russia redirects its gas supplies to Asia since the European market cut off Russian energy after the start of a “special military operation” in Ukraine, China is heavily investing in Russian gas export projects, such as the Power of Siberia 1 pipeline that has operated since 2019, and prospective second pipeline that will connect Russian Yamal peninsula gas fields with northern China through eastern Mongolia by 2030. In addition, a third pipeline project is under construction to connect natural gas-rich Sakhalin Island with Chinese cities. The plan is for Russia to supply 10 billion cubic meters of natural gas annually via this route for the next 30 years.
These new pledges are on top of China’s already substantial investments in Russia’s fossil fuel industry. Records demonstrate that Rosneft, Russia’s largest oil producer, sold 49 percent of its share in a joint mining enterprise to Sinopec, China’s state-owned petrochemical company. Also, the years 2014 and 2015 saw China National Petroleum Corporation and the Silk Road Fund acquire 20 percent and 9 percent stakes, respectively, in the $27 billion Yamal LNG export facility in the Arctic, equal to almost a third of all investments in the project.
By expanding its reliance on Russian gas, China can claim it is trying to establish a transitional bridge between the phasing out of the coal industry and the future development of clean energy sources. However, this strategy contradicts the COP’s main aim to completely phase out fossil fuels, and more importantly, further boosts industrial development in its major fossil fuels-producing neighbor. Once China reaches the promised carbon peak in 2030 and embarks on the path to net zero, it will have a contingency plan through its Russia holdings and investments to substitute energy losses, if any, while continuing to maintain a reputation as a global climate upholder.
Considering clashing priorities for China, achieving alignment and consensus between parties at the climate conference will be extremely complicated. The global community should not be distracted by the green euphoria created around the China-U.S. climate cooperation. It must consider the bigger picture that economic security and prosperity are far more prioritized in China than green energy. The excitement over Xi and Biden’s handshake should not overshadow more meaningful efforts to substitute coal, oil, and gas with clean energy in power generation.
The prevalence of fossil fuels countries in the upcoming negotiations and the possibility of oil and gas companies’ lobbying for delays create significant barriers to persuade China to rupture its relations with Russia. While COP28 can achieve a milestone in clean energy transition and revamped multilateral climate pledges, the binding financial obligations and investments in the energy sector illustrate the more fragmented picture of the geopolitical landscape and climate actions. Although China can argue it has legitimate rights to secure its energy mix for greater economic development, the international community can and should push China to delineate how the phasing out of fossil fuels fits into its net-zero pathway, in light of its significant investments in Russia’s oil and gas industry.