The unprecedented agreement reached at the COP28 climate summit in Dubai this week is unlikely to prompt a dramatic upheaval in the U.S. energy landscape, but it could bolster efforts to shift the country toward energy sources that are less harmful to the planet.
The text, released Wednesday, calls for a “transition away” from planet-warming fossil fuels, marking the first time such language has appeared in a COP agreement. It further calls for tripling renewable energy development and doubling energy efficiency.
The agreement is not legally binding for participating nations, however, and experts noted that its significance for the U.S. may be more symbolic than practical.
“It’s not like it’s some kind of global mandate or something that all of a sudden is going to restructure anything,” said Morgan Bazilian, who previously worked as a European Union negotiator during climate talks. “That said, it probably plays well for the United States.”
“The United States has been putting out good policy to implement renewables, especially under the Biden administration,” he added. He pointed in particular to the renewable energy tax credits and subsidies found in the Inflation Reduction Act (IRA) passed by Democrats last year.
“I don’t see [the COP28 deal] dramatically accelerating it, but we’re prepared to do some of those things that might have good international optics,” he said.
The fossil fuel transition itself, meanwhile, is likely to have fewer concrete implications for the U.S., Bazilian said. He noted that the country is both the world’s top producer of oil and gas and, unlike many other nations, has no state-owned energy company.
“The impact overall on the companies on the oil, gas and coal side will be very limited,” he said.
Under the COP28 agreement, the U.S. would be required to put out a new nonbinding emissions reductions plan, or what’s known as a nationally determined contribution, in 2025, said Jean Su, director of the Center for Biological Diversity’s energy justice program.
“The tricky part about the text is it does allow some loopholes, and it’s very easy to see the U.S. exploiting some of the loopholes,” she said. “That’s what loopholes are for.”
For example, she noted, the language around transitioning away from fossil fuels only applies to the energy sector, excluding sources such as agriculture and plastics production — the latter of which the U.S. has expanded in recent years.
“The hope is that the U.S. will not do that, not exploit those loopholes, [but] the action so far by the Biden administration has been disappointing,” she said, pointing to the U.S. becoming the No. 1 gas exporter under President Biden.
Despite the nonbinding nature of the text, she added, the agreement still “sends an important signal to industry in the U.S. and around the world … that countries are choosing to end the fossil fuel era.” She pointed to attempts by countries in OPEC, a group of oil-producing nations, to oppose language calling for a “phase out” — or eventual elimination — of fossil fuels from being included in the COP agreement as evidence that “all of these industry players are feeling really threatened by these global talks.”
Peter Bakker, president of the World Business Council for Sustainable Development, told The Hill that the IRA makes the U.S. uniquely positioned to take advantage of the agreement’s provisions on boosting renewable capacity and energy efficiency.
“I’m in no business meeting anymore where people don’t hold up the IRA as an example,” he said, praising it for “the framework that actually incentivizes innovation instead of punishing the lack of innovation like Europe is trying to do.” As such, he said, the COP agreement “plays into the strength of the American economic system.”
Bakker said he expected some early pushback from fossil fuel interests against efforts to shift from the planet-warming fuels to more renewable energy sources, but he compared the current stage of the transition to the introduction of the iPhone. “In the beginning there’s a bit of resistance and all of a sudden there’s exponential growth,” he said. “I have high hopes in the American spirit to drive this.”
Ultimately, Bazilian said, the agreement’s implications for the U.S. may be more abstract, lying in the symbolic significance of a major oil-producing state such as the United Arab Emirates (UAE) “producing a result that was as good or better than previous COPs” — an indication that a country like the U.S., which produces far more oil and gas than the UAE, could deliver similar results with enough effort.