What’s Missing from the COP28 Climate Deal

The global challenge of phasing out fossil fuels

The COP28 climate summit wrapped up a few hours ago with a compromise agreement that calls on nations to move away from fossil fuels.

But the deal still gives energy-exporting giants like Saudi Arabia plenty of leeway to continue drilling and presents countries and investors with the huge challenge of how to fund a green-energy shift over the next few years.

Here’s what’s in the pact: pledges by countries to wean their economies off fossil fuels in a “just, orderly and equitable manner” this decade; triple their uptake of renewables by 2030; restrict methane emissions; and halt carbon emissions entirely by midcentury.

It’s the first explicit agreement to curb fossil fuel use in the roughly three decades of such multinational negotiations. Scientists say drastic cutbacks are needed to keep global temperatures from rising by more than 1.5 degrees Celsius.

John Kerry, President Biden’s special climate envoy, said he was “in awe of the spirit of cooperation” among negotiators. And Dan Jorgensen, the Danish minister for climate and energy, marveled that such an agreement could be reached at a summit hosted by the oil-rich United Arab Emirates.

Here’s what isn’t in it: tough language on outlawing construction of new coal-burning power plants and specific commitments to help finance poorer nations’ energy transitions. “Asking Nigeria, or indeed, asking Africa, to phase out fossil fuels is like asking us to stop breathing without life support,” said Ishaq Salako, Nigeria’s environmental minister.

Heading into the conference, there was deep skepticism among climate activists and scientists that the Emirates and other OPEC nations would try to water down any deal. And indeed, countries like Saudi Arabia were among those pushing back against efforts to craft a tougher pledge to fully phase out fossil fuels.

The deal is not legally binding. And some critics grumbled that it contained “cavernous loopholes” that would give countries producing fossil fuel incentives to continue oil exploration, including allowing room for “transitional fuels” like natural gas.

Investors didn’t appear worried about what the pledge might mean for the fossil fuel industry: Shares in Chevron and Exxon Mobil were up slightly in premarket trading on Wednesday.

Much work remains. One recent estimate suggests that trillions of dollars in investment is needed to transition to greener fuel sources like wind and solar and avert a climate catastrophe.

“We must transform the international financial system to pursue and achieve our climate goals,” Kerry told delegates. He added that policies were needed to encourage investment in green initiatives “and shift finance away from the things that put our shared prosperity at risk.”

HERE’S WHAT’S HAPPENING

Congressional Republicans rebuff Ukraine’s pleas for more aid. Despite personal lobbying by Volodymyr Zelensky and President Biden, Republican lawmakers continue to insist that additional money and weapons to combat Russian forces must be paired with changes to U.S. border security. It’s unlikely that aid will come by year end, potentially imperiling Ukraine’s defense.

Bipartisan U.S. lawmakers call for further restrictions on trade with China. A House report said that Washington should take more steps to sever ties, including by revoking the low tariff rates that were granted to Beijing when China joined the W.T.O.

Netflix pulls back the curtain on its viewership. The streaming giant on Tuesday released audience numbers for over 18,000 titles, revealing its biggest hits in the first half of the year. (The winner: “The Night Agent,” which boasted 812 million watched hours.)

Defending global efforts to rein in Big Tech

As technology giants and its allies urge President Biden to push back against a landmark European Union law meant to curb the power of Big Tech, a group of progressive lawmakers are urging him to stand firm.

In a letter sent on Tuesday to Biden and shared first with DealBook, the legislators defended the Digital Markets Act from claims that it unfairly discriminates against U.S. businesses. “Big Tech companies are trying to squash competition by skewing the rules of digital trade to favor monopolies,” Senator Elizabeth Warren of Massachusetts, one of the letter’s authors, told DealBook.

Silicon Valley argues that the E.U. law violates international trade rules. Tech companies and their lobbyists say the act overwhelmingly takes aim at American companies, with five of six so-called gatekeeper platforms subject to tougher regulations being U.S. firms. They also say it could undermine American efforts to maintain an innovation edge over China.

Amazon has appealed its designation and sought exemptions from parts of the law. And last month, Bytedance’s TikTok, Meta and Apple all filed challenges to the law. (Microsoft and Google said they would not fight their categorization.)

The progressive lawmakers dismissed those complaints. The group, led by Warren and Senator Amy Klobuchar of Minnesota, said that the law wasn’t targeting companies by national origin. Instead, it’s taking on American tech giants “because they have engaged in anticompetitive tactics.”

More broadly, the American lawmakers pointed to the millions that tech companies have spent fighting efforts to rein in their industry. They added that the tech industry’s attacks on the E.U. law seek to undermine Biden’s antitrust aims.

Musk’s problems on Earth, and above it

A move by the Federal Communications Commission on Tuesday to continue denying SpaceX’s Starlink nearly $900 million in federal funding is the latest blow to Elon Musk’s corporate empire. Yet that decision drew complaints by a Republican regulator that the Biden administration was setting government agencies against the billionaire’s businesses.

The F.C.C. again rejected Starlink’s request for broadband subsidies. The satellite internet provider had applied in 2020 for $885.5 million worth of federal money to provide service to remote U.S. communities. But the agency withdrew that money last year, after Starlink had agreed to provide service to 642,000 homes and businesses in 35 states.

Starlink, the agency ruled on Tuesday, “failed to demonstrate that it could deliver the promised service.” Among its concerns were failures in SpaceX launching its latest Starship rocket.

Republican F.C.C. commissioners disagreed, calling the decision unfair to Starlink by holding the company to unrealistic performance requirements. “What good is an agreement to build out service by 2025 if the F.C.C. can, on a whim, hold you to it in 2022 instead?” one, Nathan Simington, wrote in his dissent.

The other Republican commissioner, Brendan Carr, went further. In his dissent, Carr wrote that the F.C.C. was joining “the growing list of administrative agencies that are taking action against Elon Musk’s businesses,” pointing to a “pattern of regulatory harassment.” (Tesla is facing multiple government inquiries, including into its Autopilot driver monitoring system, while the S.E.C. is looking into Musk’s $44 billion takeover of what is now X.)

Musk posted on X that “companies that lobbied for this massive earmark (not us) thought they would win, but instead were outperformed by Starlink, so now they’re changing the rules to prevent SpaceX from competing.”

In a statement, Jessica Rosenworcel, the F.C.C.’s chair and a Democrat, said the agency had followed “a careful legal, technical and policy review” in denying Starlink’s request.

• In other Musk news: X is expected to bring in just $2.5 billion in ad revenue this year, according to Bloomberg, after bringing in about $1 billion per quarter a year ago. It’s further evidence of big brands pulling back from the social network.

Ackman’s other dispute with Harvard

Harvard’s governing body is standing by Claudine Gay as the school’s president, despite calls to remove her over what critics called insufficiently robust denunciations of antisemitism. (It also cleared her of plagiarism charges raised by conservatives.) But it faulted her initial response to the Oct. 7 Hamas-led attacks.

The move is a partial rebuff of Bill Ackman, the hedge fund billionaire who has been among the loudest critics of Gay and Harvard more broadly. The Times spoke with Ackman about his unusual activist campaign against his alma mater. In a response to the article on the social media platform X, the financier detailed another grievance against the university.

Ackman is still upset about a 2017 donation to Harvard. He gave $10 million worth of shares in Coupang, a South Korean e-commerce giant that was then privately held, to the school to help it recruit the highly regarded economist Raj Chetty.

In 2021, the financier said he learned that Coupang was going public at a $50 billion valuation, which would value the Harvard gift at $85 million — only to find out that the school had sold the stock for $10 million back to Coupang:

Harvard had never told me that they had sold the shares. I was never offered the opportunity to buy the shares back for $10m or a higher price, which I would happily have done, had I known the University needed liquidity.

And the notion that Harvard needed $10m of liquidity in the context of a $50 billion endowment is on its face absurd. Any sophisticated investor should also understand that when a private venture-backed company is buying back stock, it is a bad idea to sell.

Ackman wants what he says he’s owed: the right to allocate the profit from that investment, $75 million, to a Harvard-related initiative of his choice.

• In other university news: Marc Rowan, the private equity mogul who publicly demanded ousting Liz Magill as the University of Pennsylvania’s president, suggested that he wanted to help further overhaul the school’s governance. Scott Bok, who recently stepped down as the chairman of Penn’s trustee board, warned that “donors should not be able to decide campus policies or determine what is taught.”

THE SPEED READ

Deals

• Ken Griffin’s Citadel reportedly plans to return roughly $7 billion in profits to its investors for a second straight year. He and David Geffen also pledged a record $400 million donation to the Memorial Sloan Kettering Cancer Center in New York. (Reuters, Bloomberg)

• Walgreens Boots Alliance is said to be in talks to spin off Boots, the British pharmacy chain, potentially via an I.P.O. at a nearly $9 billion valuation. (Bloomberg)

Policy

• A former global diversity executive at Meta pleaded guilty to defrauding the tech giant out of more than $4 million. (Justice Department)

• Microsoft says it won’t oppose efforts by U.S.-based employees to unionize. (NYT)

• Argentina has devalued the peso by more than 50 percent and cut spending as part of a radical economic overhaul by its new president, Javier Milei. (Bloomberg)

Best of the rest

• “To Lure FIFA, France Floats the Promise of a Tax-Free Home” (NYT)

• Steve Simon will step down as C.E.O. of the Women’s Tennis Association, as the tour grapples with a pay-equity dispute and recent on-court troubles. (ESPN)

• Andre Braugher, the actor known for tough cop roles on “Brooklyn Nine-Nine” and “Homicide: Life on the Street,” died on Monday. He was 61. (NYT)

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