Swimming upstream: addressing fossil fuel supply under the UNFCCC

The article addresses the multiple ways to incorporate supply-side policies such as phasing out fossil fuel production under the Paris Agreement.  

It notes the need for phase-down of fossil fuel production to meet the temperature targets under the Paris Agreement, particularly to address price-induced market leakage. Integrating supply-side commitments into the UNFCCC would link them to climate goals, ensuring they are part of the broader global climate effort. It would also encourage other countries to make concrete commitments in relation to supply-side policies, and normalise the importance of supply-side policies as part of climate policy. Another benefit is that it would provide clear market signals to financial markets that a large number of countries are committed to scaling back investment in fossil fuels, avoiding lock-in of fossil fuels in markets.  

Parties could integrate their supply-side policies in their nationally determined contributions (NDCs) by including targets for fossil fuel production phase-down, constraining investment in fossil fuel supply (e.g. subsidy removal); and moratoria on new fossil fuel infrastructure. The process of developing long-term low greenhouse gas emission development strategies under the Paris Agreement provides an opportunity for countries to map out the phase out of fossil fuels, incorporating trajectories consistent with the two temperature goals. National inventory reports do not recognise actions that might reduce emissions offshore, so an accounting framework based on extraction-based emissions would ensure supply-side measures that affect exports are counted. The enhanced transparency framework should be flexible enough to integrate targets that track phase-down of fossil fuels. The global stocktake could track measures targeted at fossil fuel extraction. Finally, a way to build knowledge amongst countries on supply-side policies includes convening sessions devoted to such policies at UNFCCC technical expert meetings.  

Countries willing to phase-down fossil fuels can lead by example by addressing supply-side policies in their NDCs and work with other countries to advocate for the inclusion of fossil fuels into parts of the Paris Agreement. Finally, countries could form dedicated coalitions to address transitions. 

The article can be used to support the importance of addressing supply-side policies to comply with the Paris Agreement temperature targets, supporting measures that phase out fossil fuel production, e.g. rejecting new fossil fuel extraction projects.