Who all pays for this environmental debt?

Climate change refers to long term shifts in temperatures and weather patterns. It can last for a few hours to eons. However, accounting for the Industrial Revolution in 1750, human beings and their activities have emerged as significant factors in driving the climate on Earth.

An UN report published in 2018 discussed the alarming consequences of an increase of 1.5 degrees Celsius, compared to 2 degrees Celsius in the next two years. The death of coral reefs and ice free summers in the Arctic are inevitable consequences of such growth.

“Twelve years to save the planet was actually: 12 years to cut global emissions by 40 to 60 percent to stay consistent within a 1.5 degrees celsius scenario.” says researcher, Zeke Hausfather. The same outcome was provided in the legally binding Paris Agreement at COP21, 2015.

Globalization and industrialization in rich nations have contributed significantly to deforestation, fossil fuel production, and unsustainable agricultural practices. US, Chinese, Russian and many others have been cited as the largest emitters of greenhouse gasses, and China is the largest contributor, with 10,668 million metric tons of CO2 emitted in 2020.

However, poor and developing economies that have contributed the least to climate change are among the most vulnerable to its effect today, and are seeking more financial commitments from rich countries. Many of which have grown their economies by burning fossil fuels.

Most recently, these countries are recounting the financial pledge made by the world's rich, industrialized countries(including the US, Canada, Australia, Britain, Japan) of commiting to a $100 Billion a year. This has happened after affected nations have had to take up loans to recover damages in their own countries. Yet this promise was only fulfilled up to a little over 83 billion dollars.

However, a report from the European Parliament states COP27 members had agreed on an overarching 'cover decision', the Sharm el-Sheikh Implementation Plan. The main COP27 delivery was the 'loss and damage' fund. Targeting vulnerable developing countries, the fund will respond to loss and damage, the adverse effects of climate change.

Although,a report by 55 vulnerable countries estimated their combined climate-linked losses over the last two decades totalled $525 billion, or 20% of their collective GDP. Some research suggests that by 2030 such losses could reach $580 billion per year.

The effects of commitments that have not been met yet and a reliance on fossil fuel revenues has made it increasingly difficult for developing economies to adapt to the global transition of switching to renewable energies.

“Nations will need to agree on another financing pledge of at least $100 billion a year before 2025, so negotiations at this year’s summit will begin shaping that goal. “ says New York Times.

The amount of money received through the first pledge has helped fund a few mitigation projects which can help developing countries transition away from fossil fuels, like building a zero transit system in Pakistan, yet, it's now become a global need to transition away from non renewable resources and instead focus on creating more demand for renewable energy.