Author Archives: bencanellys

A New Architecture for Climate Finance Must Encourage Private Sector Investment

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“Give a man a fish, and he eats for a day. Teach a man to fish, and he eats for the rest of his life.” In relation to climate financing, the Green Climate Fund (GCF) and Developed Country Parties, do both, and neither particularly well.  The recent IPCC 1.5 report has taken away all room for delay: the GCF cannot waste its valuable funding on unaccountable, inefficient disbursements. We need a financial architecture that will let us move much faster than we are.

This COP has highlighted Developing Country Parties’ concerns that they won’t have the capital to meet the requirements of the Paris Agreement. More specifically, that they won’t have the fOptimized-Plants and coinsunds to help pay for losses and damage expected from climate change and that they cannot afford to build the necessary infrastructure, such as renewable energy sources and other low-carbon technologies, that the IPCC 1.5 report warns are necessary.

The GCF relies on Developed Country Parties’ pledges to provide that funding. However, these Parties are hesitant to invest and bear the risk for the costs of climate change. Additionally, they are hesitant to grant funding to countries that are technically “developing,” yet have emerged as economic powerhouses.

This hesitation is exacerbated by irresponsible use of funds by the GCF. Experts argue that the use of climate grants, which make up 47% of the GCF’s activities to date, rather than direct investment, are a misallocation of public funds. They can actually harm markets by pushing out small-scale private actors, often going to those who could afford it anyway. Instead, GCF capital should be blended with government money in order to attract private investors and encourage market growth.Flood_Affected_Areas_of_Amreli_District_Gujarat_India_on_24_June_2015_2-768x512

Private investors are hesitant to invest in the face of unfamiliar risk. This includes vulnerabilities to extreme weather, droughts, and rising sea levels for coastal economies, but also inaction by governments that will exacerbate these effects. However, private investors are often moving into these markets anyway, which are slowly becoming more viable as investment options. To encourage this, public funds from the GCF and governments should be used to leverage investment from private actors. Instead of being given freely, by themselves, in the form of grant disbursements, proponents argue that they should only be committed in cases where they can encourage private investment at 10x or higher.

Many Developing Countries, LDCs, and SIDS require foreign aid to kick-start these markets. Private investment must be encouraged as part of that funding. There is simply not enough public funding to tackle the problem alone.

Coaland and the Colossal Fossil

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A true consensus government, the COP leaves the most progressive at the mercy of the most obstinate. In this system, science deniers and climate activists battle it out, yielding ground, gaining concessions, and, often, feeling like they’ve gotten nowhere. As the world burns and our chances to halt the irreversible slip through our fingers, every small victory reminds us that winning slowly is still losing. So what do you do when a coal-loving country holds the gavel? Can observers only wring their hands as an understaffed Polish Presidency sets regressive agendas and embraces corporate polluters?

The answer, of course, is to mock them.

A hero of satire has emerged to hold the worst members of the COP accountable: Climate Action Network and their “Fossil of the Day” awards.

Each day of negotiations, CAN has chosen a deserving winner. Those who, through obstinacy, ignorance, or plain greed, continue to obstruct global climate action, all earn a place on the podium.

The list of daily finalists includes:

A Polish victory has been brewing all COP. President Andrzej Duda opened his remarks by stating: “There is no plan to fully give up on coal. Experts point out that our supplies run for another 200 years, and it would be hard not to use them.” They’ve followed this up by cozying up to large polluters, filling the venue with single-use plastics, and holding events advertising “clean coal.”

However, most disturbing has been Poland’s battle against climate activism at the COP. At least twelve members of civil society groups and one COP Party delegate were turned away at the Polish border, including CAN Europe’s Zanna Vanrenterghem.

These activities appear to be the product of a new law banning unplanned protesters from Katowice, the COP venue. This barrier to a free and involved public directly belies Poland’s professed commitment “to providing access to information, access to participation, and remedy on environmental matters.” This has had a chilling effect on participants. Coupled with an unambitious conference agenda, the activities of the Polish government have cast a pall over the proceedings that match the one in the air.

“We don’t have the luxury of feeling discouraged”-Former Vice-President Al Gore Warns of the Dangers of Climate Change at COP24

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“The cheapest and most effective carbon sequestration technology is called a ‘Tree.’ When this technology is taken to scale, it is called a ‘Forest.’” The Former Vice President of the United States and Presidential hopeful paused to let the laughter subside. Holding up a hand, he became deadly serious once more. He had come to COP24 to continue fighting for the cause he had become synonymous with: Climate Change.

As the United States joined countries such as Saudi Arabia, Kuwait, and Russia in denying the dire IPCC 1.5 report and negotiations on the Paris Agreement Work Program slogged on, Al Gore reminded the world that this is a group effort. While the effects of climate change do not affect us all equally, they still affect us all.

Shahid Balouch, a gravedigger, poses for a photograph in a mass grave in the cemetary, as preparations are made in case of another heatwave in Karachi, Pakistan May 13, 2016. REUTERS/Akhtar Soomro

Shahid Balouch, a gravedigger, poses for a photograph in a mass grave in the cemetery, as preparations are made in case of another heatwave in Karachi, Pakistan May 13, 2016. REUTERS/Akhtar Soomro

High temperatures continue to set records around the world. They melt roads and damage infrastructure; high nighttime temperatures impact agricultural viability; and in Pakistan, the government has dug preemptive mass graves, anticipating the costs to human life. Most concerning, however, are the effects of rising temperatures on global air currents.

When the jet stream is strong, it forms a boundary between lower latitudes and arctic winds known as the Polar Vortex. When high temperatures near the equator push an excess of warm air northward, the jet stream weakens and this boundary dissolves. This occurred at the end of 2017.

The weakened jet stream allowed the Polar Vortex to split in two, sending excessively cold systems into North America, Northern Asia, and Europe. Temperatures plummeted to below -10C, infrastructure collapsed under the weight of snow, and, in Brussels, homeless people who refused shelter were detained for their own safety. All major climate zones, except Antarctica were warmer than their 30 year averages; including the Arctic.

The area between the, now two, polar vortexes, was occupied by vagrant jet stream currents. The warm air washed over the North Pole during what is typically its coldest season; the season when annual sea ice forms and multiyear sea ice is strengthened. Instead the Arctic lost 95% of its multiyear sea ice.
His voice lowered and his tone conspiratorial, Gore looked over the crowd: “This is part of a larger annual weather pattern. However, we do not have the luxury of being discouraged.” We, as world leaders on climate change, have a moral responsibility to reverse these trends, and save our planet and its people.

His words were a call to action, aimed at breaking the political deadlocks that plagued various aspects of the negotiated text. As we move into the last two days of negotiations, we’ll see if his words have galvanized the Parties, or if the same issues plague consensus.

Our Talanoa: Recognizing a Common Thread

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Few things are as complex as the myriad relationships that exist between the countries of the world. Like unruly children, they’ve fought, made peace, gotten bored, and hit each other again when mom wasn’t looking. Putting them in a room together, even when they’re negotiating for something mutually beneficial, can be a hotbed of tension. The Talanoa Dialogue ensures each is heard, IMG-7730preventing conflict with one simple rule: no blaming others, and no criticisms.

“Talanoa” is a Fijian word used to describe an inclusive, participatory, and transparent dialogue that focuses on sharing experiences through story-telling in order to build empathy among participants. During the process, parties build trust and advance knowledge in a way that fosters stability. The dialogue was undertaken pursuant to decision 1/CP.21 and slated for 2018; its goal was to take stock of progress towards the long term goals of the Paris Agreement and inform the preparation on nationally determined contributions (NDCs).

cr=w_1200,h_750,a_ccThe dialogue focuses the parties on three questions: “Where are we? Where do we go? How do we get there?” To answer these questions, there was a Preparatory Phase and a Political Phase. The Preparatory Phase began in January, 2018 and will conclude at the COP. Its primary goal is to build a strong scientific base for the Political Phase, which, in turn, will take stock of the collective efforts of the Parties to reach their commitments under the Paris Agreement.

Once in the Political Phase, Parties engage in Ministerial Talanoas of 12-13 participants. Each is facilitated by Ministers from the Pacific Region or from Poland. These break-out sessions revolve around storytelling and discussion based on guiding questions. These sessions gave delegates the chance to speak unabashedly about their country’s unique circumstances and about their goals for the future. They promise an opportunity to be honest with partner states about what the climate regime and the goals of the Paris Agreement mean for your people.

If the Parties are warring siblings, the Talanoas are the peace that comes with age and understanding. Once removed from their adversarial positions at the negotiation table, the only realization left to them is that we’re stuck with each other, for better or worse.

The Pre-2020 Stocktake: Disappointment and Resolve

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As with any massive undertaking, practice makes better. The Global Stocktake in 2023 is no different.image1024x768
In accordance with decisions at COP21, to implement enhanced action prior to 2020, and at COP23, emphasizing that enhanced pre-2020 ambition can lay a solid foundation for post-2020 goals, this year’s COP held a two-part assessment of global progress. The first event, held on December 5th, was a Technical Review, while the second event, held on December 10th, was a High-Level meeting of the Parties. Each session was composed of two panels. Each answered predetermined questions followed by an open plenary discussion where Member Parties could intervene.
The Technical Review’s first panel, consisting of the heads of the subsidiary bodies, considered “the work of the UNFCCC process related to the mitigation efforts up to 2020.” It addressed issues such as technology transfer, capacity building, and the IPCC 15 report. The second panel, made up of financial bodies and technical experts, highlighted “efforts of the UNFCCC process to enhance climate implementation and ambition up to 2020.” It focused on ease of access to climate finance, as well as on parties’ progress towards their finance commitments.
COP24-6Today’s High-Level meeting saw two panels made up of ministers of various Developed and Developing Country Parties: Poland, Grenada, the European Commission, China, & Australia in the first session, followed by Norway, Brazil, Germany, Ethiopia, Japan, & Finland. The panels began by discussing the pre-2020 efforts of Parties to mitigate greenhouse gases & ways to enhance efforts, and the provision of support for climate efforts and enhancing efforts, respectively.
Discussions in each session forced Parties to consider their efforts to implement mitigation strategies, make climate finance more accessible, and to meet the various commitments and ambitions in the pre-2020 period. While the aim of this stocktake was to “provide a space for holistic reflection by ministers and other high-level representatives,” it raised serious questions regarding gaps between Parties’ commitments and the reality exposed by the IPCC 15 and other reports.
While Panelists focused on the positive and what had been working thus far, such as finding the right incentives to delink economic growth from emissions, doubts were raised during the plenary. Most poignant was India’s intervention: “Are these pre-2020 actions adequate? Have we addressed the task before us?”
To which, it seems, the answer is “No. Not yet.”

Crypto-Climate Change: Bitcoin Emissions May Push Us Above 2C In Two Decades

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Capture1Created and released in 2009 by Satoshi Nakamoto, Bitcoin (BTC, XBT) embodies a very simple concept; we don’t need a centralized agency controlling our money. The Peer-to-Peer cryptocurrency uses a public ledger—a blockchain—to monitor transactions between users, thereby cutting out the central bank. Each transaction is recorded as a block and added to the blockchain. Each user keeps a copy of the ledger as a way to decentralize the system and prevent falsified transactions. As a method of transaction verification, users with the proper computer skills “mine” the blockchain. They use ASICs (Applied-Specific Integrated Circuits) to receive a blockchain and verify the transactions within. In exchange, the miner receives a small amount of BTC. This is where the issue arises.

Mining the blockchain requires a massive amount of energy. In November 2017, the BTC network consumed more energy than the Republic of Ireland. As of May 2018, Digiconomist estimated that Bitcoin usage emits 33.5 MtCO2e annually. When combined with other cryptocurrencies, these emissions rival those of countries like Sweden and Norway. Large emissions are inherent in the mining system.

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Mining is a winner-take-all game. The full reward goes to the miner who solves the puzzle first. The greater your processing power, the greater your chance of success. The more electricity you use, the faster your computer runs. As long as the reward for successfully mining covers the cost of that electricity, the practice is profitable. The Bitcoin network as a whole reinvests almost all of the BTC paid out as reward into its electricity consumption.

As I write this, a single Bitcoin (BTC) is valued at $5,651.14. The reward for successfully mining a block is 12.5 BTC (approx. $70,600.00) plus any transaction fees that occurred during the time it took to mine the block (approx. $2500). This process occurs every ten minutes. The system rewards miners for using as much electricity as is feasible and penalizes those miners that don’t.

Although it is hard to predict the rise and fall of cryptocurrencies, their use may return to popularity. On November 14, 2018, Bitsane, a trading platform, released a public announcement that it had officially listed USDT (Tether) for trade. USDT is known as the digital dollar and the first stable crypto-coin. It is backed by the US Dollar and provides an easy method for liquidating cryptocurrencies, making them more tradable and, perhaps, priming them for the wide-use that fans have hoped for.

The blockchain also has the potential to revolutionize climate change action. Groups such as the Blockchain Climate Institute have embraced this technology and have advocated for its use in climate finance and as a reporting mechanism. In a new book, Transforming Climate Finance and Green Investment with Blockchains, 40 experts explore its applications in implementing the Paris Agreement. The topics it covers include blockchain applications in renewable energy smart grids, climate finance transfers, clean technology transfers, carbon markets, and the enforcement of green finance regulations. These topics will also be discussed in various side events at COP24. As widely distributed ledgers, blockchains are “trust machines” that can scale and speed up vital climate actions in the near future.

As COP24 Approaches, Negotiators Attempt to Narrow Their Focus

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GST at UNIn the months leading up to the COP, Parties are in constant discussion. On September 27th, the incoming COP24 Presidency organized an informal consultation in New York, on the sidelines of the U.N. General Assembly. The COP23 Presidency, UNFCCC Executive Secretary, and presiding officers all attended, along with thirty-three member states. The Parties’ lead negotiators met to discuss four elements of the potential COP24 outcome in Katowice, Poland: the NDCs process, adaptation, finance, and transparency. As the report of this meeting indicates, one of the issues addressed was “How do we manage the transition from the current transparency system to a future one, while ensuring flexibility for the countries in light of their capabilities?”

In Article 13 of the Paris Agreement, all Parties agreed to an enhanced transparency framework for action and support. This framework has built-in flexibility that accounts for Parties’ different capabilities and circumstances. Article 13.1 announces explicitly that “in order to build mutual trust and confidence and to promote effective implementation, an enhanced transparency framework for action and support, with built-in flexibility which takes into account Parties’ different capacities and builds upon collective experience is hereby established.”  Article 13.2 adds that “the transparency framework shall provide flexibility in the implementation of the provisions of this Article to those developing country Parties that need it in the light of their capacities. The modalities, procedures and guidelines referred to in paragraph 13 of this Article shall reflect such flexibility.” The Parties have been negotiating the exact content of these modalities, procedures, and guidelines (MPGs) since 2015 and have designated COP24 as the deadline for agreeing on them.

A key part of these negotiations is recognizing that some Parties require additional funding toCBIT achieve their reporting and transparency goals. To this end, the Capacity Building Initiative for Transparency (CBIT) was established. CBIT’s goal is to strengthen the institutional and technical capabilities of developing countries for collecting and reporting data on progress made on their Nationally Determined Contributions (NDCs).  This data will then be used to inform the global stocktake (GST), which is a collective assessment of all Parties’ progress on their NDCs toward the Paris Agreement’s Article 2 objective of keeping atmospheric warming to “well below” 2C. The Paris Agreement requested that the Global Environment Facility (GEF) support the establishment of CBIT through voluntary contributions and build donor support. As of December 2017, $61 million had been pledged to the CBIT Trust Fund and $53 million of it had been dedicated to the first 41 projects in 39 countries in Africa, Asia, Eastern and Central Europe, and Latin America and the Caribbean.  Through this support, CBIT has established a Global Coordination Platform that helps and encourages Parties to engage in multilateral and bilateral capacity building initiatives. Parties agree that CBIT is necessary for ensuring a smooth transition to a new transparency system. However, not all Parties agreed on what form the new system should take.

While discussing the scope a new transparency system at the September 27th meeting, Parties suggested that all Parties have the same the submission date for the first biennial transparency report (BTR). Others proposed to have different submission dates for developed and developing Parties. This would reflect the timing each Party required under their CBDRRC. Additionally, while building flexibility into the system, the Parties split into two camps. One side suggested that flexibility be general in nature and by each Party’s national circumstances and capacities, while the other maintained that they be specific and limited to a small number of issues.

preCOPThe next discussion is on October 24th in Krakow at the close of the “pre-COP” meeting hosted by the COP24 Presidency. The suggestions made in New York will be explored and expanded upon by the Parties continuously until the COP. The enhanced transparency network covering mitigation, adaptation, and support is paramount within the PA to informing the GST and allowing parties to aggregate their efforts towards our global goal.