Why We Need to Fix the Global Energy Governance Architecture
The current global energy governance architecture is not likely to deliver what the world badly needs to address the climate crisis. Unless drastic changes are introduced, COP30 in Brazil next year is going to be another failure to deliver actionable outcomes.
The recently concluded COP 29 in Baku, Azerbaijan, has frustrated environmentalists, policymakers, and global citizens. While the conference was expected to drive meaningful progress on pressing climate issues, its outcomes mirrored the shortcomings of previous COPs, particularly in addressing the global reliance on coal. Countries disagreed on how the last year’s pledge to transition away from fossil fuels, should be taken forward and instead pushed the decision to the next COP in Brazil.
Coal remains a significant impediment to achieving global climate objectives. Responsible for producing two-thirds of global total CO2 emissions within the global power sector which is more than any other source, coal is the single largest source of emissions globally as it has the highest carbon intensity of all fossil fuels.
China plays a pivotal role in the global coal narrative. As the largest financier and builder of coal plants worldwide, its Belt and Road Initiative (BRI) has facilitated coal projects across developing countries, including Pakistan. While China pledged in 2021 to cease funding new overseas coal projects, its domestic and ongoing international coal commitments present a contradictory picture. For instance, China remains a leading supplier of coal technology and financial support, enabling the construction of new coal plants in nations struggling with energy deficits.
Notably, while Chinese-backed coal capacity declined after the 2021 pledge, the country continues to support projects with substantial environmental repercussions. Recent data indicates that China approved or financed over 20 GW of coal capacity globally between 2021 and 2023, emphasizing the need for more stringent international oversight.
Why COP 29 and subsequent COPs are not likely to deliver on the Green House Gas emissions lies in the very architecture of global energy governance - systems, institutions, policies, and processes that guide the coordination, regulation, and management of energy production, distribution, and consumption across international boundaries. Here are three reasons:
Fragmented Responsibilities: Overlapping mandates among global organizations dilute climate action and create inefficiencies.
Voluntary Agreements: The Paris Agreement relies on non-binding pledges, limiting its ability to enforce compliance.
Insufficient Financial Support: High capital costs and limited technical capacity deter developing nations from adopting renewables, leaving coal as a more accessible alternative.
Last but not least, current frameworks fail to address the unique challenges of coal-dependent countries, further entrenching reliance on fossil fuels.
A case in point, Pakistan’s reliance on coal exemplifies the dilemmas faced by developing nations. The Sahiwal Coal Power Plant (SCPP), constructed under the China-Pakistan Economic Corridor (CPEC), represents a critical milestone in Pakistan's energy landscape. Despite contributing significantly to the national grid, the SCPP also locks Pakistan into long-term carbon emissions due to its reliance on imported coal and subcritical technology.
From 2016 to 2023, coal's share in Pakistan’s energy mix rose from 0.21% to over 31%. This shift, driven by insufficient financing for renewables and an unstable energy governance framework, underscores the broader challenges faced by developing economies. The SCPP’s construction, despite the Paris Agreement’s call for a coal phase-out, exemplifies the disconnect between national energy policies and global climate commitments.
What could be done to reform the Global Energy Governance and support a transition away from coal? We suggest four pathways:
- Dedicated Financial Mechanisms: Establish funds specifically designed to assist coal-dependent economies in adopting renewable energy technologies.
- Technology Transfer Programs: Facilitate knowledge-sharing and access to affordable, reliable renewable energy technologies in developing nations.
- Stronger Enforcement Mechanisms: Introduce penalties for non-compliance with climate pledges to ensure accountability.
Finally, the frustration at COP 29 underscores the urgent need for structural reforms in global energy governance architecture. The future of global climate action hinges on addressing the entrenched coal reliance of developing nations. Developing nations criticized the $300 billion a year until 2035 at the COP29 climate agreement, deeming it inadequate to address their urgent needs and the enormity of the challenge. Tailored support and robust enforcement mechanisms must replace voluntary pledges and fragmented governance. The current global energy governance architecture is not likely to deliver what the world badly needs to address the climate crisis. Unless drastic changes are introduced, COP30 in Brazil next year is going to be another failure to deliver actionable outcomes.
Dr Abdur Rehman Cheema is a Water Governance & Institutional Specialist at the International Water Management Institute based in Lahore. He can be reached at arehmancheema@gmail.com. LinkedIn ; Web of Science; Google Scholar
Muhammad Haris is a Programme Officer at, COMSATS University. He can be reached at muhammadharis@hotmail.com.
Photo by Dexter Fernandes
