The GCF – Can We Count On It?

gcf.logoIn 2009, as we reported earlier, developed country Parties to the UNFCCC committed to jointly mobilize $100 billion/year by 2020 to help developing countries address their climate change needs. The Green Climate Fund (GCF) – the designated heavy lifter for this goal – was created by COP16 in 2010. Its purpose is to fund developing country efforts to mitigate and adapt to climate change through “low-emission and climate-resilient development.” (See our coverage of the private sector role in the GCF here, and co-financing efforts toward the $100 billion goal here.)

The GCF, now with pledges of just $10.3 billion, became fully operational in 2015. However, as of the start of 2016, only $1.6 billion was reported actually in hand, and none of the $168 million the GCF Board approved for the first 8 projects at its November meeting had been distributed. (We Im-startiving-pig-pay-green-climate-fund-nowreported on the U.S.’s $3 billion pledge here, the first $500 million of which has now been deposited into the Fund.)

The Fund’s goal for 2016 is to distribute $2.5 billion. Its press release also reports a package of current proposals worth $1.5 billion, with 22 projects totaling $5+ billion in the proposal pipeline. (A conflicting update from the Asian People’s Movement on Debt and Development (APMDD) reports $6.2 billion in 124 proposals and concepts in the 2016 pipeline, including 22 that are approval ready.) In either case, that 2016 goal is a high bar.

The GCF Board made some foundational progress at its 12th meeting in early March in Songdo, Korea, including adopting its first Strategic Plan (SP) and a 2016-2018 action plan. (The final SP had not been released as of this posting, but the draft can be found here.) It also accredited 13 new entities (some with pending status), which will bring the total accredited to 33. Additionally, the Board authorized its first Project Preparation Facility grant ($1.5 million to Rwanda). This new and evolving facility is designed to support developing country accredited entities in creating highly fundable projects.green-climate-fund-photo9

The Green Climate Fund has its critics. Hallway talk at COP20 in Lima buzzed about the potentially reckless pace UNFCCC Executive Secretary Christiana Figueres had set for the Fund’s scaling up. Governance questions arose soon after. Now, Small Island Developing States and others are facing onerous and highly bureaucratic accreditation hurdles for accessing it. Leading up to the March meeting, civil society voiced strong objections to the limited meeting access, and to the potential accreditation of international banking giants HSBC and Crédit Agricole.

Unfortunately, the Board’s emerging accreditation strategy, intended to address concerns, wasn’t ready for prime time by the March meeting. In related action, the Board awarded pending accreditation to HSBC and Crédit Agricole – both with substantive conditions to be met before final approval. One of these for HSBC, according to APMDD, is getting a positive report from the U.S. federal monitor’s review of the corporation’s money laundering reforms. HSBC_London_800(That report’s release is currently delayed until a federal appeals court ruling). Interested readers can find the accreditation assessments in appendices of the report of the Board’s decisions.

On a definite positive note, after considerable discussion, the Board ultimately agreed to live webcasting of its meetings in an 18-month experiment, beginning in June

As the GCF story unfolds, let’s hope for lots of transparency and lots of pledges turning to lots of cash. The developing world is counting on it.gcf


Adaptation Economics Reveal Insufficient Adaptation Activities

When national and local economies are faced with calculating potential climate-impacted losses, decision-makers face difficult financial-planning decisions.

6355818699_492128f721_oNature Climate Change published a study comparing adaptation responses between global megacities based on spending measures. The study found that cities varied their adaptation spendings between £15 million and £1600 million. Developed cities allocate most of their adaptation funds to energy and water, developing countries to health and agriculture.

Overall, the study concluded developing cities’ wealth, and not the amount of vulnerable individuals, drive adaptation spending. Thus, “current adaptation activities are insufficient in major population centers in developing and emerging economies.”

 


It’s All About the Benjamins: Ratcheting Up Financial Support for Developing Countries

In 2009 Parties to COP15 in Copenhagen agreed to a global goal of mobilizing $100B (that’s right, billion) per year for climate finance by 2020. A recent OECD report indicated that we are well on our way to achieving that goal (with $62B committed in 2014). Unfortunately though, $100B may not even be enough to keep global temperature rise between 1.5˚C and 2˚C. For this rDollarseason, much of the discussion at COP21 has centered on the scale of climate finance. Exactly how much additional funding will be necessary? For now, the answer seems to be “more.”

In response to this need, the Global Environmental Facility (GEF), one of the entities responsible for providing climate finance under the UNFCCC, announced a new initiative today: the Climate Aggregation Platform (CAP). The GEF will seed CAP with $2M, which is expected to catalyze over $100M in co-financing from other partners, including from the Inter-American Development Bank.

CAP is just one piece of an ongoing effort by all global actors to increase access to climate financing from a variety of sources. The draft Paris Outcome places an emphasis on the use of public funds, but also acknowledges the role that private finance will play in addressing climate change. Private investors, which currently comprise about 25% of global climate investment, typically offer loans rather than grants. This means that the investors expect to make their money back over time. Therefore, to entice private

Naoko Ishii, CEO and Chairperson, Global Environment Facility

Naoko Ishii, CEO and Chairperson, Global Environment Facility

investors to promote clean energy in developing countries, there must be some indication that the project represents a sound investment. CAP aims to help facilitate these types of robust investment opportunities.

First, CAP will establish a global working group to provide key finance and industry stakeholders with transparent access to, and coordination of, climate-related projects in developing countries. CAP will also promote project standardization, with the goal of creating uniform contracts and repayment plans. Finally, CAP will develop in-country demonstration projects and provide technical support for other pilot transactions. These actions will serve to increase the number of qualified projects, creating a scalable pipeline of clean energy investments.

Establishing a streamlined framework for project development has two major benefits: It increases the penetration of clean energy technologies in the developing world, thereby serving climate change goals. It also allows investors to aggregate a large number of projects, thereby reducing the financial risk. In the same way that insurance companies profit by insuring large groups of people with a variety of health risks, climate investors will be more successful if they invest in large numbers of projects with a variety of risk profiles. As your financial planner will tell you, a diverse portfolio is generally a strong portfolio.

And confidence is high that, if we build it, they will come. Since the financial crisis of 2008, there is a significant appetite for impact investments, which are transparent investments in projects that have demonstrated social benefits. Many institutional investors, along with independently wealthy individuals, are actively seeking investments like clean energy projects in the developing world. There is approximately $46B in impact investment already under management, and that number is on the rise. Leveraging a small amount of public money has been shown to catalyze additional private investment in these types of projects. Some studies indicate that $1 of public funding can attract $20 of private funding. Just last week, Bill Gates alone pledged to contribute $1B in seed capital to potentially transformative energy systems with “near zero carbon emissions.” And he’s getting his friends to pitch in too.

Developing programs like CAP that foster a strong market for investment in climate-friendly projects is one of the most important things that come from COP21.


Finances are the Glue that will make the Paris Agreement Stick

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Starting the second week of negotiations, the Climate Action Network’s held a press conference to discuss their view of the current “state of play” in the climate talks. Two themes clearly emerged; the need for a robust and certain climate Agreement to come out of Paris with clear targets and deadlines to send the correct signal to the industrial and business sector, and the financial support from developed countries to reach those targets and deadlines. What constitutes a robust agreement? Review of ambition goals coupled with a ratcheting mechanism to achieve a 1.5℃ target, resubmission of the INDCs, and setting the goal of 100% renewables and decarbonization by mid-century.

 

How do the Parties meet these targets and deadlines? By a robust finance mechanism. The INDCs can only be implemented if there is adequate financing that includes Loss & Damage. The billions pledged in Copenhagen and Cancun kept the developing country Parties at the table; now the call is to implement those mitigation and adaptation strategies to achieve decarbonization of the economy. This will come faster for some countries and slower for others depending upon their different capabilities. The collective financing proposed, which would include “all Parties in a position to do so”, is not the way to secure new financing. This, according to OxFam, is the equivalent of the developed countries “holding the money hostage on this issue.” The developing countries will contribute as they can, of course; but a vague reference too their obligation to do so has no place in the text.Money tree

 

What the developing Parties clearly articulated as a priority throughout last week’s negotiations, continues to threaten the stickiness of this Paris Agreement  – the provision of finances to enable those countries to put their INDCs into effect. The developing Parties have fastened onto the idea of traditional differentiation and are washing their hands of the language that all Parties will contribute if “they are in a position to do so”. They will only cement a deal that has clear markers for capacity to contribute and places those responsible [the global North] as the major financiers of the efforts to stem climate change.

 


Sparks Fly as G77 and China Clash With Developed Countries Over Climate Finance

4820321_6_aa7c_la-sud-africaine-nozipho-mxakato-diseko-parle_c9a54ee2845b833d2f8e309d8e8f0516Thursday’s ADP Contact Group stocktaking meeting took an unexpected turn when Ambassador Nozipho Mxakato-Diseko of South Africa took the floor with sharp words for developed countries that she accused of obstructing today’s Spin Off Group on Adaptation. Importantly, Ms. Mxakato-Diseko spoke in her capacity as Chair of the G77 negotiating group, which represents 137 developing countries plus China and includes the majority of the world’s poor. Bolivia also spoke on behalf of this group, accusing the developed countries of negotiating in “bad faith.”

At the stocktaking, the G77 and China expressed two chief concerns about negotiations to date. First, it noted that developed countries continuously fail to give attention to “Loss and Damage” associated with climate change, an issue critical to the LDC and SIDS groups who are most vulnerable to climate change impacts. The second source of contention related to whether and at what levels rich countries were willing to provide climate financing to poor countries to enable them to cut emissions and cope with the effects of global warming.

As of now, the developed countries, particularly the U.S., do not want mention of Loss and Damage in the final agreement. As for climate financing, one article of the draft agreement would require countries to make plans for adapting to climate change, and states that: “Developing country parties are eligible for support in the implementation of this article.” However, it is unclear whether rich nations will provide fixed levels of financial assistance.

After presenting these grievances to the ADP Co-Chairs Thursday, the G77 and China suspended the meeting to “huddle” for just over 20 minutes. Fortunately, instead of threatening to withdraw from further negotiations, the G77 and China returned and proposed a procedural path forward, in which the ADP Co-Chairs would produce a clean draft agreement text to the Parties for review Friday to allow for a comprehensive view of all of the issues.

While these meetings will pick up Friday morning, time is of the essence. Parties must work to finalize the latest draft of the agreement and decision by Saturday midday. This deadline comes from COP President Laurent Fabius who charged the ADP with cleaning up the draft agreement and decision text by reducing the number of options.

Fun fact: our delegation left the venue Thursday night with Ambassador Nozipho Mxakato-Diseko as meeting attendees traveled home on the COP21 shuttle.

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Will some be left behind? The significance of climate finance

amanjumpsove For countries on the front lines of climate change, access, availability, and urgency of funding needs are significant. As an example, rising sea levels in Senegal and Gambia have already impacted agricultural production. Saltwater intrusion into agriculturally productive lands has reduced food production. Further, warming temperatures and resulting increased length of seasons have heightened health risks associated with vector borne diseases. The impoverished state of these countries does not position them to to enter world markets to offset domestic deficiencies through imports. The conditions they face cannot be attributed to a random occurrence, though. Instead the plight of Senegal and Gambia and many other least developed countries (LDCs), as well as small island developing states (SIDS), and landlocked developing countries (LLDCs) is one of significant challenges.

In spite of not being large emitters, the effects of climate change are disproportionately high for these countries; unlike developed countries, these countries have made negligible contributions to the increased speed of climate change, as presently observed. They are the poor, vulnerable, low-emitter nations that are negotiating for the right for climate finance from the developed world. However, funding for mitigation and adaptation projects has been limited. Recent commitments for funding, though on the surface robust to the casual observer, have not inspired confidence across all LDCs, SIDS, or LLDCs.

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On Monday, the starting day of COP21, eleven developed countries made commitments to the Least Developed Country Fund (LDCF). Total pledges to the LDCF totaled $248 million. The sum was an auspicious signal, a numeric gesture in parallel with the phrase “no one left behind.” However, at a side event on the same day of the announcement, LDCs commented on the difficulty of accessing funding, the rigorous nature of the application process, and the limited appearance of urgency from funding bodies. Two days later, on Wednesday, at another side venue, other LDCs commented on the difficulty of access to funding and the need to develop national climate finance strategies. Cambodia noted that the prospects of international financing are good but the modes of financing remain uncertain and the process is slow. The Gambia noted that demand for LDCF resources exceed the funds available for approved projects.

Some observers have voiced that funding is perceived by the developed world as financial aid when it should be viewed as the promotion of the common good. A communal perception could foster access and availability of funding provided from developed countries to developing countries in a more expeditious manner.

Mary Robinson, the former President of Ireland, noted in her remarks in Monday, following the LDCF funding announcement, that climate change is a global problem, stating, “Climate change is a problem for all.” She went on to advocate, “The agreement itself needs to be people-centered. The needs of LDCs need to be heard.” At the close of the third negotiating day, it was not clear whether the needs of LDCs were being considered under no one left behind.

In the remaining twenty-four hours of the first phase of COP21, discussion will continue with respect to language that would expedite funding. Additionally, the amount of aggregate funding available to developing countries from 2020 onward remains outstanding. In a few more days the group work of COP21 will set the trajectory for climate finance as the world sets its course to recalibrate its relationship with the planet. The decision will be significant and will send a strong signal with respect to the balance of developing country needs and developed country committment.


Individually Survivors, Together a Force – World’s Vulnerable Take Action at COP21

photo-19Today, at the Third High-Level Meeting of the Climate Vulnerable Forum (CVF), government leaders representing over 40 countries that are the most vulnerable to impacts from climate change adopted a historic joint declaration, the Manila-Paris Declaration. The Declaration, and its associated three-year Road Map, calls for a more ambitious long-term temperature goal of 1.5˚C, zero emissions by mid-century, and 100% renewable energy decarbonization by 2050.

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At the meeting, Christiana Figueres, Executive Secretary of the UNFCCC, acknowledged this important action but raised concerns that CVF was not making a coordinated effort to push for an ambitious Paris agreement. Outgoing chair of the CVF, Philippine President Benigno S. Aquino III, also called for collective action stating, “individually, we are already survivors; collectively, we are a force towards a fairer, more climate-proactive world.”


Is the GCF the salvation?

The Green Climate Fund (GCF) is the largest and fastest-growing climate fund. It was the largest before Lima (US$9.3 billion, bringing the fund to $9.9b, just shy of the $10b goal for COP20) and now, with the new commitment of Norway, plays an even more protagonist role. However, in the first week at the COP20, experts have expressed their concern about how high the expectations are from the public and private sector in relation to the GCF. Thereby, before celebrating you will need to apply. The accreditation process opens in March 2015, and in June the GCF will start considering proposals. For more information visit: http://news.gcfund.org

 


Behind Closed Doors: Adaptation Fund Negotiations

logo adaptation fundThe last session of the informal consultations on the second review of the Adaptation Fund was scheduled for today, but the parties took longer than planned in their previous negotiations, so the final meeting was pushed back until tomorrow. Today’s meeting instead became a continuation of earlier negotiations, and as it was announced at the start of the session, observers were asked to leave. As one of those observers who had to vacate my seat, I wonder what progress this review is undergoing. The Adaptation Fund was first established in 2001 to finance adaptation projects and programmes in especially vulnerable developing countries that are parties to the Kyoto Protocol. These funds come from a percentage of the clean development mechanism (CDM). The status of funds contributed and projects approved are available in handy maps and charts on the Climate Funds Update website.

What changes and positions were proposed at today’s session, only the lucky parties in attendance will know. Observers, such as myself will just have to wait to see final product.senegal adaptation fund


Popular measures for conservation: Payments in Ecosystem Services

In recent years, payment in ecosystem services (PES) and other market measures for conservation has gained popularity as market measure of pollution prevention and conservation particularly for use in the developing world.  In the industrialized world, financial mechanisms such as carbon tax and emissions cap and trade are used as methods of pollution control to supplement environmental command and control regulation.  However, in the context of the developing world, where environmental regulation may be weak due to weak rule of law, financial mechanisms may function as alternative methods of pollution control while better regulation is developed. Yet, this is challenging to implement as market mechanisms can only properly function with proper regulation.

f0054-01For developing countries, a nationalized PES scheme, has features which may allow it to be the ideal market instrument to pilot better environmental regulation.  It is ideal for environmental policymaking due to its policy and financial benefits.  In financing, PES is beneficial because it is an incentive mechanism with low transaction costs. The services flow directly from the provider to the user thereby reducing transaction costs. The government only acts as an intermediary body role in the market. Second, the development of a comprehensive PES structure allows the government to identify regulatory gaps.  In implementing PES schemes, the government can identify gaps in existing laws, the needs of stakeholders, baseline data and generally see how regulation will play out.

Furthermore, at the second day of the COP’20 was stablished by the Center for International Forestry Research (CIFOR) that the user fees in Costa Rica and Vietnam are similar in their design yet different in their regulatory backgrounds.  Costa Rica is experienced in environmental policymaking and using environmental market instruments for conservation while Vietnam is formative on these fronts.  Despite the differences in governance, both countries have relied upon PES to improve regulation.

Incorporation into existing regulatory schemes too could be a solution for when the government is in the process of developing more robust environmental regulation.  Being part of the licensing process may encourage participation and compliance from more firms. Currently, compliance within the voluntary PES schemes are dependent on market demand for sustainable investment and the goodwill of the investor.For instance, the user fees in Costa Rica and Vietnam, similar in their design yet different in their regulatory backgrounds.  Costa Rica is experienced in environmental policymaking and using environmental market instruments for conservation while Vietnam is formative on these fronts.  Despite the differences in governance, both countries have relied upon PES to improve regulation.

The concept of PES to pilot regulation is not new. Developing countries can look to case studies of others who have used PES to implement better environmental safeguards. As in any PES scheme, land tenure and high transaction costs remain to be issues.  These issues need focused attention and through PES, developing countries can pilot better environmental regulation for long term environmental protection.


Mind the [Ambition] Gap

mind the gap

 

When stepping onto the Underground in London, a voice rings out, “Mind the gap.” Perhaps this should also be echoing through the halls of the COP20 venue in Lima, Peru, this week. The pre-2020 ambition gap is often stated in terms of what must be done differently from business as usual to keep GHGs from warming the global temperature 2°C (relative to pre-industrial levels) before the year 2020.

The most recent IPCC Report (AR5) states with high confidence that there are opportunities through mitigation, adaptation and integrated responses to narrow this gap. The ADP meetings held in Lima during this session are ripe with discussions of interim measures to be taken prior to the next year’s Paris COP21. On Tuesday, the Parties discussed a draft text which is set to accelerate implementation of climate action. Over the next 10 days, Parties will negotiate which gap-closing measures they are willing to take.

Parties are looking to negotiate specific texts and elements, while in Lima, that can be solidified at the upcoming COP21 in Paris; without concrete commitments in place upon leaving Lima next week, it will be very difficult to give Congresses, Parliaments and other governing bodies time to ‘okay’ these commitments before COP21.  Many Parties have voiced that it is very late to still be negotiating texts for the Paris agreement – yet the negotiations must continue.andina

Any agreement signed in Paris next year will become effective in 2020.  This leaves a ‘gap’ of the next five years – many Parties are already suffering from climate change and are calling for a developed nations to make commitments now.  The opening session of the ADP on Tuesday allowed G77+China to lead the way in calling for accelerated action by developed countries through financing and technology transfer for developing countries.  Although it is early in the process, Parties seem to be mindful, at least, that there is gap.

 


The Growing Trend of South-South Cooperation on Climate Change

Su-WeiOn Monday China’s Chief Climate Negotiator, Mr. Su Wei, offered some interesting views at a COP20 side event on a significant and growing trend in the efforts to tackle climate change – South-South cooperation.  The event, “Perspectives on the 2015 Paris Deal: Options on the road from Lima 2014 to Paris 2015,” was organized by the South Centre and the Third World Network and also featured representatives from the Africa Group on ADP and India.  Mr. Su Wei stated that while China welcomes the announcements of pledges totaling $9.7 billion to the Green Climate Fund, the goal was to reach $10 billion by the time the Parties convened in Lima.  Moreover, according to Su Wei, though we have heard many pledges that developed country Parties will contribute up to $100 billion per year by 2020, we still have no clear road map as to how those funds will be raised.  On top of that, countries such as the United States and Japan, which have pledged a total of $4.5 billion between them, must still gain approval from their respective legislatures in order to actually live up to their pledges.  This task will certainly be difficult in the United States, where the Congress has already vowed to block the US contribution.

Su Wei stated that developing countries can no longer continue to wait for developed countries to provide the climate funding they are legally required to provide.  Therefore, China has begun to fill in where it perceives the developed world to be lagging behind and started providing financing of its own to developing countries.  For example, at the 2012 Rio+20 UN Conference on Sustainable Development Premier Wen Jiabao announced that China would “make available 200 million yuan to help least developed countries and those in Africa tackle climate change.”  More recently, China’s Vice Premier Zhang Gaoli announced at the September UN Climate Summit that China would pledge $6 million to support South-South cooperation on climate change.  Finally, Chinese President Xi Jinping revealed at the G20 Summit in November that China would establish a South-South Cooperation Fund on Climate Change.

Su Wei’s remarks reflect the growing trend of South-South cooperation on climate change.  The UK think tank Foreign Policy Centre has reported that in 2013 “there was $92.7 billion in new investment in renewable energy in developing countries and $121.7 billion in developed countries,” representing a very significant narrowing of the gap gcf_logobetween the two since 2007.  Additionally, FPC noted a Bloomberg New Energy Finance report that in 2012 “South-South development bank clean energy flows totaled $7.5 billion, up from $2.8 billion in 2008 and compared to 2012 North to South flows of $9.9 billion.”  In a “break with tradition,” developing countries Mexico and Mongolia are also actually beginning to invest in the Green Climate Fund.  Therefore, it seems that as the developed nations continue to drag their feet with respect to their pledges to provide climate financing and enhance the implementation of the Convention, developing countries are starting to pick up the slack and forge ahead.

On December 8 the National Development and Reform Commission of China, UNEP, and the UNDP are co-sponsoring a forum on South-South Cooperation on Climate Change in Lima.  The forum will bring together ten leaders from various countries and international organizations to discuss strategies to enable a rapid scaling up of South-South cooperation initiatives.  It should prove to be a very interesting event.


Climate Finance and Capacity Building

COP15-IPCC-Rajendra-Pacha-002To stabilize atmospheric concentrations of greenhouse gases and limit temperatures to no more than 2° C above 1990 global temperature, it is necessary to set clear goals for emissions reduction looking towards 2020. Those goals have been confirmed in the last report of the Intergovernmental Panel on Climate Change (IPCC), which highlight the need for urgent action. In the first two days at the COP’20, the constraint of capacity building and finance has been repeated over and over.

In the opening speeches of the Executive Secretary of the UNFCCC and the President of the COP, as well as in special and site events, the issue of enhancing the ability of individuals, organizations and institutions to identify, plan and implement ways to mitigate and adapt to climate change, has had special protagonism. It is necessary to generate more funding sources, but as important, is coordinating strategies between mechanisms already created, such as defining criteria for monitoring systems that allow for credible measurement, reporting and verification (MRV). In other words, establishing a legal MRV framework to track compliance guarantees that a “ton is always a ton.”

cop19_cop20_pres_630Discussions on capacity building must motivate rethinking of finance priorities, enhance more efficient uses of resources to reduce emissions and vulnerability, and increase adaptation measures. Capacity building in relation to funding takes place primarily on institutional and systematic levels. In this sense, the process of implementing adaptation and mitigation actions under the UNFCCC must be simultaneously framed in national actions.  Furthermore, countries should undertake “readinness” in the context of the process, which involves the preparation of institutions, legal frameworks and public policies to make better use of financial resources. This will allow more assertive assessments of financial needs, which should have a balance with the budgetary allocation of countries.

 

 


Fossil-ing Away the Progression of the Day

Today in Lima, Japan won Climate Action Network’s (CAN) Fossil of the Day Award. CAN gives this award to countries based on their performances during the past day’s negotiations at the United Nations (UN) climate change conferences. Japan won the Fossil of the Day Award for “getting busted for funding coal and gas power stations in developing countries, in particular Indonesia, with money meant for scaling up climate action.” This slightly sarcastic yet highly prestigious award brings to light current issues, and hopes to publicly motivate the named recipient into climate action.

Japan gave Indonesia $1 billion in loans to build three coal-fired power plants in the name of climate finance under the United Nations. Japan says these plants burn coal more efficiently and are therefore cleaner than old coal plants. However, they still emit twice as much heat-trapping carbon as plants running on natural gas, and are the biggest human source of carbon pollution.smokestacks

Outside of naming the clear Fossil Day Award winner, CAN highlighted an overarching issue regarding climate finance. The UN Framework Convention on Climate Change (UNFCCC) has no definition of what climate finance is and there is no watchdog agency that ensures the climate finance funds are spent in the most effect way. Japan allocated the funding to Japanese companies under UN loans described as “thermal power plants,” with no indication that they were coal-fired projects.

There are no rules against counting such projects as climate finance under the United Nations. Christiana Figueres, Executive Secretary of the UNFCCC, unaware that the Japanese-funded coal plants in Indonesia were labeled as climate finance, stated “there is no argument” for supporting such projects with climate money. “Unabated coal has no room in the future energy system,” she told AP News.

CAN, a worldwide network of over 900 non-governmental organizations (NGOs) in more than 100 countries, continues to promote government action to limit human-induced climate change by bringing theses issues to light.

Fossil of the Day

The Green Climate Fund, which has similar goals to help poorer nations adapt to the warming climate, also has no watchdog agency or formal definition of climate finance.The power of “public shaming” presented by CAN’s Fossil of the Day Award, not only galvanizes climate action commitments, but instills a new fire within climate activists.


Extra, extra! Read our COP19 wrap-up in the Huffington Post!

Congrats to our Week 2 Observer Delegation on its recent publication in the Huffington Post courtesy of climate and energy reporter Ben Jervey.  In it, we recap COP19/CMP9’s last week of activity, analyzing what this “nuts and bolts” COP did and didn’t achieve. Specifically, we take a close look at adaptation, loss and damage, subnational initiatives, new REDD+ rules, and technology, all in light of the ADP’s struggle to find common ground on mitigation, adaptation, finance, technology, and capacity-building to ensure maximum participation in the legal agreement that will succeed the Kyoto Protocol in 2020.

VLS COP19/CMP9 Observer Delegation Week 2

VLS COP19/CMP9 Observer Delegation Week 2

P.S.  Given that the Huff Post version did not include all of our links, I’m pasting below the draft that includes them.

As COP19/CMP9 comes to a close, the Vermont Law School Observer Delegation reflects on what it witnessed during the second week of the climate change meeting. As the high-level ministers began arriving on Monday, the pace of negotiations ramped up. Beginning with several days of speeches about the contours of the legal agreement post-Kyoto Protocol, financing mechanisms, alternative energy, and adaptation needs in developing countries, the technical discussions of COP19’s first week turned to long days and nights of political bargaining.

In this piece, we explore what this “nuts and bolts” COP did and didn’t achieve. Specifically, we take a close look at adaptation, loss and damage, subnational initiatives, new REDD+ rules, and technology, all in light of the ADP’s struggle to find common ground on mitigation, adaptation, finance, technology, and capacity-building to ensure maximum participation in the legal agreement that will succeed the Kyoto Protocol in 2020. For more detail about these subjects and play-by-play of the most contentious issues, see our blog.

Adaptation Activities Accelerate

Although adaptation is still a relatively new idea under the UNFCCC, COP19 expanded its reach by conducting workshops to showcase achievements to date and negotiating a new loss and damage provision (covered in the next section). COP16 established the Cancun Adaptation Framework (CAN), which sought to enhance action on adaptation under the Convention. National Adaptation Plans (NAPs) were established at COP17 to help countries assess their vulnerabilities and climate change risks, and adapt to them. NAPs aim to reduce vulnerability to the impacts of climate change by building adaptive capacity and resilience. They contain four main elements: (1) laying groundwork and addressing gaps, (2) preparing preparatory elements, (3) creating implementation strategies, and (4) reporting, monitoring and reviewing data.

Bangladesh is currently working on a NAP that looks at health security, disaster management practices, and infrastructure. It currently experiences storm surges and flooding, which impacts crops and food security. Malawi wants to implement a NAP due to its vulnerability to road flooding. It currently lacks sufficient policy, institutional, and legal frameworks, and faces low awareness, skills, and know-how among the general public.

While adaptation has clear benefits, it can be expensive and so the parties ask: is it worth it? Presentations at COP19 answered in the affirmative. Emergency responses to remedy damage from climate change can be even more expensive than investing in adaptation measures. Climate change impacts, like the recent Typhoon Haiyan, often cause GDP to decrease, as developing country governments spend their limited budgets on disaster relief. By investing in adaptation up front, disasters do less damage when they hit, so not as much money is spent on reactive remedies.

While COP19 included much discussion of mitigation, parties acknowledge that even the most stringent mitigation efforts cannot avoid climate change. This makes adaptation necessary. It’s not an either/or proposition.  As the UNFCCC makes increasingly clear, international climate change law must address both.

The (R)evolution of Loss and Damage

The tragedy wrought in the Philippines by Typhoon Haiyan placed the concept of “loss and damage” center stage in Warsaw. Loss and damage would pick up where adaptation and mitigation fall short, helping developing countries to improve risk reduction and assessment, strengthen adaptation, enhance capacity building to deal with slow-onset events like sea level rise or extreme effects like typhoons, and compensate them.

COP18 set a legal mandate to establish institutional arrangements, such as an international mechanism, to address loss and damage associated with the adverse impacts of climate on developing countries.  Covering both economic and non-economic losses, it could include the loss of livelihood, damage to property, food insecurity, climate migration, loss of identity, and potential human rights abuses. Due to Russia’s blocking of the agenda, the June 2013 SBI meeting did not go forward and work on this mandate was delayed to the COP19 SBI meeting.

At COP19, negotiators worked on this SBI agenda item around the clock, trying to draft text that was responsive to developing countries’ compensation needs and developed countries’ liability concerns. Tired of Australia’s antics to scuttle constructive discussions, the G77 negotiator, Bolivian Rene Gonzalo Orellana Halkyer, walked out of the meeting at 4 am this past Wednesday morning and other G77 countries followed suit. Undaunted, high-level party delegates, co-chaired by ministers from Sweden and South Africa, attempted to hammer out a text, debating whether it should be an institutional arrangement, work program, or task force. Would it get its own mechanism under an UNFCCC institution, like the Clean Development Mechanism does, or be housed under the SBI or SBSTA, or simply sit under the adaptation pillar?

At the closing plenary, delegates approved “the Warsaw international mechanism for loss and damage associated with climate change impacts.” Controversially, it is organized under CAN’s adaptation pillar. G77+ China, AOSIS, and Yeb Saño from the Philippines made it known that this text was inadequate, as loss and damage meant “beyond adaptation.” This opposition sparked an hour huddle, with U.S Special Envoy Todd Stern and Fiji’s Sai Navoti discussing the use of “under” while surrounded by at least 50 other negotiators.

Afterward, the COP19 President announced consensus on retaining the word “under” while including an amendment requiring review of the mechanism at COP22 in 2016. Going forward, the executive committee to the Warsaw international mechanism will meet and develop a work plan by COP20; a two-year review will take place at COP 22; and the COP will make an “appropriate decision” on loss and damage governance based on this review.

Thinking Globally, Acting Locally

On Thursday, November 22, during the first-ever COP Presidency Cities and Sub-national Dialogue of the Cities Day, one environmental minister declared that “the only people with the power to actually change anything are the local elected officials.”

While international agreements on climate change have languished, cities around the world have acted. For good reason: two-thirds of urban dwellers live on the water, subject to sea level rise and lethal heat waves from the urban heat island effect. The Cities Climate Leadership Group C40 membership  comprises 40 of the 50 biggest cities of the world and represents 8% of the world’s population, 5% of greenhouse gas emissions, and 21% of the global GDP. Together, cities have the collective clout to get something done.

The COP19 Dialogue of the Cities Day, organized by the International Council for Local Environmental Initiatives (ICLEI), C40, and EUROCITIES, highlighted work that is already happening in local municipalities around the world, and sought support for it from the national and international levels. Roundtable discussions focused on adaptation, transportation, waste, and buildings. A recurring theme was the potential for a bottom-up approach that empowers local governments to combat climate change by creating a platform for continuous dialogue between cities, national government, and UNFCCC parties.

Building on this event, ICLEI (which coordinated the adoption of the Nantes Declaration of Mayors and Subnational Leaders on Climate Change in September, 2013)  advocated for a more substantive forum for identifying key priority areas of collaboration on mitigation and adaptation at the city and subnational levels during the next ADP session in June, 2014. Although the ADP decision text changed throughout the last few days of negotiations, and ICLEI did not receive all it sought, the final iteration includes cities and subnational governments in technical meetings “to share policies, practices and technologies and address the necessary finance, technology and capacity-building” and a subnational forum “to help share among Parties the experiences and best practices of cities and subnational authorities in relation to adaptation and mitigation,” both to be held at the next ADP session. In short, this COP19 decision means more meetings, reports and business as usual for the UNFCCC. But with this clear recognition of a subnational role in UNFCCC lawmaking may come more resources for the people actually doing the work on the ground.

REDD+ Is a Go

One of the more significant outcomes of this week was the package of decisions, known as the Warsaw Framework for REDD+ (Reducing Emissions from Deforestation and Forest Degradation in Developing Countries), that the COP approved to provide a formal framework, safeguards, and funding in hopes of cutting deforestation in half by 2020 and halting it by 2030. Every schoolchild knows that the forests are the world’s lungs: this is the UNFCCC’s smoking cessation program.

REDD+ has been implemented on the ground by various development organizations, including the World Bank, USAID, and the World Wildlife Foundation, in a somewhat haphazard and experimental fashion since its conception in Montreal in 2005 and development in Bali in 2007. It was met with serious criticism by indigenous peoples around the world as another form of colonialism, with Bolivia in particular championing to keep market mechanisms out of this mitigation activity. This new version of REDD+ hopes to address those concerns. The safeguards included for biodiversity, ecosystems, and indigenous peoples’ territories, livelihoods, and rights are commendable. It may even serve as a mechanism for governments to more formally recognize indigenous land rights. Hopeful thinking? Perhaps. We will have to watch carefully how the new REDD+ decisions improve its implementation on the ground.

Good News About Technology

Developing nations will require new technologies to achieve their goals of mitigation and adaptation to climate change. At COP16 in Cancun, the UNFCCC established the Climate Technology Centre and Network (CTCN), a technology transfer mechanism that collaborates with national governments to develop and implement desired climate technologies. Two months before COP19’s start, the CTCN Advisory Board approved the CTCN Modalities and Procedures for adoption at COP19. While both SBSTA and SBI adopted the CTCN’s report, and forwarded a draft decision for approval, , the COP did not reach the agenda item.  Instead it will instead take up these items at SBSTA 40 and SBI 40 in Bonn next year.

Nevertheless, a COP19 side event organized by the UNFCCC Secretariat marked the official opening of the CTCN. While most of the world may not have noticed, COP19’s advancement of CTCN is crucial for developing nations striving to fulfill their commitments under the UNFCCC. The CTCN can now accept requests from countries’ Nationally Designated Entities (NDEs), which is good news for achieving international, on-the-ground progress for mitigation and adaptation.

Developing countries can now request from CTCN resources to develop and implement clean energy technologies. Clean energy is essential for reaching all parties mitigation targets, and CTCN can supply the requisite experts to deploy these innovative technologies. At the CTCN event, Zambia announced plans to submit a request for clean energy projects. Bangladesh has described plans to request agricultural technologies from CTCN, in order to improve crop yields. Agriculture is a main cause of deforestation, and improving agricultural practices has the direct and immediate impact of keeping more carbon out of the atmosphere. Of course, new technologies will be necessary to adapt to the effects of climate change. Following Typhoon Haiyan, the Philippines will request a collaboration with CTCN to rebuild with clean energy.

ADP:  2(b) or not 2(b)

By 2am Saturday morning – two hours after COP19/CMP9 was due to end – tired and tense negotiators left the room where they had spent the last eight hours locking horns over language in the fourth draft decision the ADP had debated since Monday. Environment ministers from Venezuela, E.U., U.K., and U.S. were in the room working directly with their negotiating teams. Yet even they left not knowing if the parties would achieve their COP19 mandate of determining the elements of the new legal agreement to be negotiated in Peru next year, signed in Paris in 2015, and put into effect in 2020.

The contested language reflects the main sticking points between developing and developed countries about constructing mitigation targets, setting timelines, balancing pre- and post-2020 mitigation, and financing.  For example, Article 2(b)’s language of post-2020 mitigation targets was changed from commitments to contributions in the final round.  This obligation, applicable to all countries under the Doha Amendment, focuses on parties doing “domestic preparations for their intended nationally determined contributions” and reporting them “in a manner that facilitates the clarity, transparency, and understanding” of them as early in 2015 as possible.  Subpart 2(d) was added to request financial support for developing countries doing this domestic work. Notably this language of differentiation eschews references to Annex 1 of the UNFCCC, even though the G77+China and AILAC asserted in every ADP session that the post-2020 agreement is made under the Convention and thus the Annex applies as is.

All parties agreed that pre-2020 mitigation commitments under the Kyoto Protocol’s second commitment period is lacking, whether in terms of number of countries (participation) or amount of GHG emissions avoided (stringency). Thus Article 4 calls on developed countries to make or enhance their national emissions reduction targets, and for developing countries to do the same with their nationally appropriate mitigation actions. Article 3 urges developed countries to follow through on the financing, technology transfer, and capacity-building work that it has already committed under the Convention, noting its ability to leverage compliance with Article 4.

How to complete the ADP’s work and how to fund it reached some resolution by the closing plenary.  On process and timelines, delegates agreed to meetings of high level ministers at both the June inter-sessional meeting in Bonn and at COP20, as well as an additional sessions in March and possibly another one between June and December. The ADP decision also noted the U.N. climate change summit that Ban Ki-Moon will host on the eve of the U.N. General Assembly’s September meeting. Thus the parties will have up to five meetings next year to turn the COP19 ADP decision into a working draft to kickstart COP20 discussions.   On finance, however, there was less resolution. Developing countries insisted on the developed countries living up to their capacity to fund this climate change lawmaking, as part of their common but differentiated responsibility, and mistrusted calls for private financing. The U.S. noted the importance of private financing as a complement to public funding, highlighting the role the latter could play in middle- and high-income countries while reserving government funds for the lesser developed countries.

Overall, while COP19/CMP9 made some progress toward Lima and Paris, it was limited by continued concerns about the transparency of negotiations and moving toward an “applicable to all” standard without some accounting for historical responsibility. As the Earth Negotiations Bulletin observed, a “sense of resolve was notably absent” in Warsaw, due as much to an absence of political will as to the vagaries of the UNFCCC process. While the REDD+ framework and other “nuts and bolts” adjustments represent real steps forward in elaborating an international system of climate change law, a question remains whether they are enough to motivate countries to continue to invest in it.

 

This post was written by Tracy Bach, Heather Croshaw, Alisha Falberg, Dan Schreiber, and Lindsay Speer, members of the Vermont Law School COP19/CMP9 Observer Delegation. You can read more of their observations at their COP19 blog, Substantial and sustained.