In March 2017, Amb. Bo Kjellen (Sweden) and I wrote a Strategy Note (“Once more unto the breach, dear friends, once more”), focussing in particular on what would enable China to continue taking a global lead after the demise of the 2014 Xi-Obama ‘G2’ that is widely credited as having paved the way for the success at Paris.
Our analysis was based on what we considered a fundamental maxim (‘red-line’) of Chinese climate change policy: as concerns issues related to the principle of common but differentiated responsibilities (such as expressed in Art. 3.1 of the UNFCCC: “developed country Parties should take the lead in combating climate change and the adverse effects thereof.”), China considers itself firmly to be a developing country, and will not allow itself to be pushed into situations that could be interpreted otherwise.
This is why we advocated that the EU should take up the role of developed country partner in a new G2 with China, and the hope is that the EU-China climate summit meeting in Leipzig in September could have a similar catalytic effect as the 2014 Beijing meeting between Presidents Xi and Obama. One concrete outcome could be an agreement with respect to enhancing ambition.
The EU has already announced that it will enhance its 2030 ambition in Glasgow. Given China’s CDBR sensitivities, it seems unlikely to me that they will follow suit at the same time. But it seems conceivable that they could agree to consider enhancing in 2025. Indeed, it would seem to be reasonable that this could be done in the context of a general invitation to Parties to do so, such as issued in the proposed ”Glasgow Ambition Cycle” language (see below, Para. 2). Given the highly significant nature of the year 2035 for China, it was pointed out to me by a Chinese colleague that the request (Para. 1) to communicate a 2035 NDC by 2025 should also be, in principle, acceptable to China.
In light of recent developments (see FT Headline below) the EU also seems to be moving towards a position compatible with the DCC, which means that Leipzig could be the locus where China and the EU are demonstrating joint-leadership and decide to complete the Ambition Mechanism of the Paris Agreement by adopting the DCC as their ambition position for Glasgow.
The Glasgow Ambition Cycle
Para. 1. Requests Parties to communicate by 2025
a nationally determined contribution with a ten-year time frame up to 2035, and
to do so every five years thereafter.
Para. 2. Invites Parties to consider in 2025 (2030) updating their nationally determined contributions with a time frame up to 2030 (2035), in line with Art. 2.2 and Art. 4.3 of the Paris Agreement, and to do so every five years thereafter.
Art. 2.2. This Agreement will be implemented to reflect equity and the principle of common but differentiated responsibilities and respective capabilities, in the light of different national circumstances.
Art. 4.3. Each Party’s successive nationally determined contribution will represent a progression beyond the Party’s then current nationally determined contribution and reflect its highest possible ambition, reflecting its common but differentiated responsibilities and respective capabilities, in the light of different national circumstances.
David Robinson, who attended COP 25 in Madrid and numerous prior COPs representing Oxford Climate Policy, has written the following eyewitness blog on what happened.
The widespread view of COP 25 as a failure reflects civil societies’ growing concern with climate change as well as unrealistic expectations about what a COP could achieve. Most insiders to the negotiating process did not expect much and were not surprised by the outcome. And in some respects, there was progress. However important individual COPs may seem, making serious breakthroughs on fighting climate change depends on what happens between those events, in particular on “top down” global political leadership as well as “bottom up” initiatives from individual governments, the private sector, research institutions and civil society.
Why were insiders not surprised? Essentially because real breakthroughs do not happen at a COP if they have not been agreed beforehand by the main players. There is always room for some detailed negotiation and arm-twisting. But major breakthroughs require global leadership and agreement well before the summit takes place. The agreement between President Obama and Chairman Xi prior to the Paris COP, for example, was central to obtaining virtually unanimous support for the Paris Agreement (PA). There was no such leadership or agreement prior to COP25 on the big issues, for instance on ratcheting up mitigation commitments under NDCs (see also Benito Müller’s Madrid blog post), or on delivering the annual $100 billion financial support for developing countries, as promised at the COP in Copenhagen. Indeed, these were not even among the original UNFCCC objectives for COP25, which was billed as a preparation for COP26. On the main official objective of COP25, namely, to agree Article 6 (international carbon trading) of the PA, there was no prior agreement and – unsurprisingly – little expectation of a deal.
So, in what way can COP 25 be characterized as successful?
First, the fact that Madrid was able to organize the conference in 5 weeks, after Chile decided it could not proceed due to political unrest, was itself evidence of international commitment and cooperation to address climate change; cancellation or postponement would have been a serious blow.
Second, there was some progress in official negotiations. The parties stressed the urgency of enhanced ambition to close the significant gap between the aggregate effect of existing NDCs and what science tells us will be required to keep temperature increases within the limits set by the Paris Agreement. Other hard-won decisions were to include oceans in future negotiations on climate change and to include “loss and damages” in negotiations over finance. Ironically, failure to agree on Article 6 could also be considered a success to the extent that it reflects an unwillingness of most countries to accept a “bad” agreement that would have allowed double-counting of emission reductions and a carry-over of a large volume of stranded emission reduction assets, condemning the new regime to failure. This list of successes is woefully short of what civil society expects, but does constitute progress in a world where key players – the US and Brazil in particular – are led by men determined to undermine the global fight against climate change.
Third, the COP witnessed and even inspired action outside the negotiations. The EU announced its commitment to carbon neutrality in 2050. The unofficial “We are still in” US pavilion demonstrated a powerful US commitment to the PA from the Congress, as well as from states, cities, civil society and companies. Large private financial institutions announced new lending policies that shift investment priorities to low carbon activities. Finance Ministers were present for the first time at a COP, a recognition that climate change is now at the centre of policy making throughout the world.
Without a doubt, the most
powerful messages came from the young, whose future is endangered by climate
change. The march led by Greta
Thunberg attracted an estimated 500,000 participants and served to
underline the divide between official negotiations and civil society.
What can we expect at COP26 in Glasgow? Negotiators will
pick up the pieces left by COP25: finalizing Article 6 and other details of the
Paris “rule book”; carrying out a reality check on the Paris ambition schedule;
and nailing down how to deliver the annual $100 billion finance goal after 2020.
With the UK and the EU having passed legislation to achieve net zero emissions
by 2050, I also expect Glasgow to focus on negative
emissions, both new technologies for capturing and using CO2, as well as
protecting and promoting natural land and ocean CO2 “sinks”.
However, a truly
successful outcome in Glasgow – especially with regard to achieving much
greater ambition – will depend on global leadership and agreements reached
prior to COP 26. While the Trump
Administration is out of the picture, the greatest challenge and
opportunity is for other global powers – starting with the EU and China – to
forge a strategic collaborative agreement to lead on the implementation of the
PA and to convince the rest of the world to follow. For that to happen will
require a very broad agreement – possibly in the form of a treaty – on climate
change, investment, trade and cooperation.
Many challenges remain, but the wheels are beginning to turn already and will continue to do so, whether or not Trump remains in power.
 This note was first published in EEnergy Informer, The International Energy Newsletter in its January 2020 edition.
An American looking at a European, a Swede to boot, for increased climate ambition may seem a bit rich, but actually the owner of Rick’s Café Americain in Casablanca gave his nationality as “drunkard” which, according to Capitaine Renault, head of the local police,”makes him a citizen of the world”. And there is no doubt: the citizens of the world will be looking to the EU to lead the way on enhancing the ambition of the initial Paris Agreement pledges — the initial ‘Nationally Determined Contributions’ (NDCs) — at the UN Climate Conference (COP26) in Glasgow next December.
‘Updating’ and the reputational risk of ‘high-ambition-washing’
The ambition fight, a defining feature of last year’s UN Climate Change Conference (COP25) in Madrid, was about whether in 2020 countries should enhance the ambition of their initial NDCs. More precisely, it was about whether two paragraphs (§23 and §24, see Appendix 1) in the Paris Outcome mandate the Parties to the Paris Agreement morally, if not legally, to enhance the ambition of their initial NDCs by 2020.
Tensions grew as the Conference reached its final days. Even though the Chilean Presidency had made ‘ambition’ a central pillar of COP25, any references to countries being called upon to ‘enhance’ or ‘update’ their initial NDCs by COP26 were removed from the negotiating text. All that was left was a very general and rather toothless acknowledgement of “the growing urgency of enhancing ambition and responding to the threat of climate change.”[§ 4 Appendix 2]
Reacting to this, the High Ambition Coalition led by the Marshall Islands, with the backing of the European Commission, made it clear that the final COP25 decision text must include a clear call for enhanced ambition in 2020. . “We need more ambition than what is currently on offer at #COP25,” tweeted Frans Timmermans, Executive Vice President for the European Green Deal of the European Commission on 14 December 2019. “We cannot tell the world that we are lowering our ambitions in the fight against climate change.”
In the end, slightly more ambitious wording was added (§§ 5-7, Appendix 2), pointing to the emissions gap between what country pledges currently add up to and what is needed to keep global temperature rise well below 2°C, and urging Parties to consider this gap when implementing §23 and §24 of the Paris Outcome (Appendix 1) .
The EU did play a very progressive role in Madrid. They announced a long-term strategy of net-zero emissions by 2050, with an implementing European Green Deal, mandating the European Commission to present by Summer 2020 “an impact assessed plan to increase the EU’s greenhouse gas emission reductions target for 2030 to at least 50% and towards 55% compared with 1990 levels in a responsible way.”[COM(2019) 640 final]
As regards the COP25 ambition debate, another significant announcement was made in the Conclusions of the European Council meeting of 12 December 2019, during the end-game at COP25, inviting the European Commission “after a thorough impact assessment, to put forward its proposal for an update of the EU’s nationally determined contribution (NDC) for 2030 in good time before COP26.”
So the initial EU NDC is to be updated by 2020, in good time before COP26. This must be welcomed, provided that ‘updating’ is understood as ‘enhancing ambition’. The reason I am highlighting this is that I have been told by a usually reliable source that some in the EU are thinking of interpreting the term as merely updating some information rather than ambition, a scenario that is unfortunately consistent with the changes that were made to the draft conclusions before they were adopted. The draft conclusions (Appendix 3) emphasised that the EU will follow §24 in 2020 “in a manner that represents a progression of ambition beyond the current one and that reflects the EU’s highest possible ambition, taking into account the collective further efforts needed and actions undertaken by all Parties in line with the long term goals of the Paris Agreement“. In the final version, however, this was replaced by the statement that in 2020 the EU will update its NDC “taking into account the need to increase clarity, transparency and understanding of its NDC“.
I sincerely hope this will not happen, and I find it difficult to believe it will, not least given the Green Deal mandate (see above). However, if it did, it would be at a considerable reputational cost for the EU. As a climate leader, such a purely informational update of the initial NDC could rightly be branded as ‘high-ambition-washing’. What is clearly expected in the 2020 update, as acknowledged by Timmermans, is the increase of the initial (2030) ambition!
“With the #EUGreenDeal adopted and #COP25 behind us, now we look forward to raising global ambitions at #COP26 in 2020.”[@TimmermansEU, 13:48h, · 15 Dec. 2019]
A Common Time Frame and the EU: ditherer or high-ambition champion?
The ambition battle in Madrid was about whether, five years after they were initially announced, countries should reconsider their NDCs in light of changed circumstances with respect to whether they still reflect the highest possible ambition. As it happens, this question also lies at the heart of another issue that was not resolved in Madrid, namely the need to complete the ‘Paris Ambition Mechanism’ by introducing a ‘Common Time Frame’ (CTF).
This debate has been going on for over five years, and the only outcome thus far has been a decision at COP24 (Katowice 2018) that “Parties shall apply common time frames to their nationally determined contributions to be implemented from 2031 onward.” At COP25, the issue was again kicked down the road without even a decision on a date for a decision. The main difference was the reaction by civil society. Fired up by what was happening (or not) on ambition they took a very dim view of the lack of progress on the CTF issue, as witnessed in the ECO article of 6 December (reproduced below).
Dynamic Ambition Replenishments
To explain the connection between a CTF and global ambition, let me use the proposal for a Dynamic Ambition Replenishment (DAR) Cycle (a.k.a. Dynamic Contribution Cycle) which is seen by many as a potential ‘landing ground’ in this debate. It can be introduced, following the template of §23 and §24 of the Paris Outcome [Appendix 1] with two very simple decisions, namely to:
Request Parties to communicate by 2025 a nationally determined contribution with a ten-year time frame up to 2035, and to do so every five years thereafter.
Invite Parties to consider in 2030 updating their nationally determined contributions with a time frame up to 2035, in line with Art. 2.2 and Art. 4.3 of the Paris Agreement [Appendix 1], and to do so every five years thereafter.
The first is simply a (‘5-year+5-year’) ‘dynamic’ compromise between §23 (5-year) and §24 (10-year) which ensures that by 2025, there will always be two consecutive 5-year NDCs communicated. The second is the ambition replenishment component, rectifying the lack of clarity in §23 and §24 that led to the ambition battle in Madrid. It establishes a 5-yearly cycle for simultaneous enhancements of ambitions initially communicated 5 years before.
As graphically represented above, the DAR Cycle involves four activities: A. The ‘ratcheting up’ (‘updating’) the ambition of the NDC initially communicated (at least) 5 years before. B. The communication (‘indication’) of an NDC with a (+5) time frame ending five years after the updated NDC. C. & D. The assessment of the +5 NDC by the public and governments.
This type of process is important for ambition because it creates an ‘enabling space’ of 5 years where everyone knows and can evaluate Parties longer-term (10-year) ambition in light of Global Stocktakes and changing circumstances, together with a regular synchronised timetable for Parties to get together and discuss potential ambition enhancements. While at present Parties can spontaneously enhance the ambition of their NDCs, it will be abundantly clear to anyone acquainted with replenishments of funds that they are more efficient and effective than such spontaneous ‘voluntary donations’.
The Way Forward
As the ECO article notes, the EU has, for some time, been treating the CTF discussion as premature, with a decision only needed in 2023, in time for the communication of a second NDC in 2025. However, this will tie the EU into a 10-year time frame, as it has been suggested that the EU needs 15 years between the communication and the the end of an NDC. Delaying the communication of the second NDC to 2025 will then mean a time frame up to 2040 (i.e. 2025 + 15).
This said, things do seem to be moving. In the discussion on the issue during the Environment Council meeting of 4 October (see transcript, Appendix 3), the majority of the 12 intervention were in favour of a 5-year time frame. No one mentioned 10 years, and only three though it was still premature to take a decision. Moreover, the Council Conclusions also recalled “the importance of striving towards common timeframes for all Parties’ NDCs, in line with the Paris Agreement.”
In fact, the EU could still join the Dynamic Ambition Replenishment Cycle, at it requests communicating a 2035 NDC by 2025and not in 2025. So the EU could follow the request (with a 15-year announcement lag) by communicating a second NDC with a time frame up to 2035 at COP26 in December 2020.
This would put the EU on the 5+5 track, and if the promised updating of the 2030 NDC “in good time before COP26” is not just cosmetic, but a genuine ambition enhancement “after a thorough impact assessment” then it should be relatively straightforward to use the same process to come up with a 2035 NDC at the same time.
Therefore, to live up to the reputation of being a high-ambition champion, the EU should by Glasgow not only communicate an enhanced 2030 NDC, but also a 2035 NDC (or at least decide that its second NDC is to have a time frame up to 2035). This would allow them to sign on to the Ambition Replenishment Cycle, thus ensuring that the Paris Agreement processes supports, rather than impedes, a regular enhancement of global ambition.
Appendix 1. The Paris Outcome
Paris Agreement Art. 2.2. This Agreement will be implemented to reflect equity and the principle of common but differentiated responsibilities and respective capabilities, in the light of different national circumstances. Art. 4.3. Each Party’s successive nationally determined contribution will represent a progression beyond the Party’s then current nationally determined contribution and reflect its highest possible ambition, reflecting its common but differentiated responsibilities and respective capabilities, in the light of different national circumstances.
Decision 1/CP.21; III. Decisions to give effect to the Agreement; Mitigation § 22. Also invites Parties to communicate their first nationally determined contribution no later than when the Party submits its respective instrument of ratification, acceptance, approval or accession of the Paris Agreement; if a Party has communicated an intended nationally determined contribution prior to joining the Agreement, that Party shall be considered to have satisfied this provision unless that Party decides otherwise; § 23. Requests those Parties whose intended nationally determined contribution pursuant to decision 1/CP.20 contains a time frame up to 2025 to communicate by 2020 a new nationally determined contribution and to do so every five years thereafter pursuant to Article 4, paragraph 9, of the Agreement; § 24. Also requests those Parties whose intended nationally determined contribution pursuant to decision 1/CP.20 contains a time frame up to 2030 to communicate or update by 2020 these contributions and to do so every five years thereafter pursuant to Article 4, paragraph 9, of the Agreement;
Decision 1/CMA.2. § 4. Acknowledges the growing urgency of enhancing ambition and responding to the threat of climate change; § 5. Re-emphasizes with serious concern the urgent need to address the significant gap between the aggregate effect of Parties’ mitigation efforts in terms of global annual emissions of greenhouse gases by 2020 and aggregate emission pathways consistent with holding the increase in the global average temperature to well below 2 °C above pre-industrial levels and pursuing efforts to limit the temperature increase to 1.5 °C above pre-industrial levels; § 6. Recalls that each Party’s successive nationally determined contribution will represent a progression beyond the Party’s then current nationally determined contribution and reflect its highest possible ambition, reflecting its common but differentiated responsibilities and respective capabilities, in the light of different national circumstances; § 7. Also recalls the request to Parties contained in decision 1/CP.21, paragraphs 23–24, and urges Parties to consider the gap referred to in paragraph 5 above with a view to reflecting their highest possible ambition when responding to this request; § 8. Reminds Parties that have not yet communicated their nationally determined contributions pursuant to Article 4, paragraph 2, and decision 1/CP.21, paragraph 22, to do so; § 9. Reiterates its strong encouragement to Parties to provide the information necessary for clarity, transparency and understanding of nationally determined contributions, described in the annex to decision 4/CMA.1; § 10. Recalls the request in paragraph 25 of decision 1/CP.21 to the secretariat to prepare a synthesis report, and requests the secretariat to make this report available to the Conference of the Parties at its twenty-sixth session (November 2020);
EU Preparations for the United Nations Framework Convention on Climate Change (UNFCCC) meetings
Draft Council conclusions: 27 September 2019 [HIGHLIGHTS that the EU will [update] [or communicate] [review] [and enhance] its nationally determined contribution (NDC) in 2020, as agreed in Paris, in a manner that represents a progression of ambition beyond the current one and that reflects the EU’s highest possible ambition, taking into account the collective further efforts needed and actions undertaken by all Parties in line with the long term goals of the Paris Agreement [and IPCC 1.5 ⁰ C report], and to increase clarity, transparency and understanding of its NDC.]
Council conclusions: 4 October 2019 HIGHLIGHTS that in 2020, the EU will update its nationally determined contribution (NDC) as agreed in Paris, taking into account the need to increase clarity, transparency and understanding of its NDC, as agreed in Katowice. STRESSES the need to step up the global efforts to tackle climate change in light of the latest available science, especially the IPCC Special Report on the impacts of global of 1.5°C above pre-industrial levels.
Transcript of interventions referring to Common Time Frames
(in chronological order, with references to webcast times [hh:mm:ss]. MS missing in the list did not refer to CTFs in their interventions)
Spain [00:07:15] “We think the text is a balanced one, but we do think it can be bolstered in two ways. The first one is that it needs to be more consistent with the Paris Agreement and the five-year cycle. Like other MS we think we need these conclusions to send out a signal of support for the five-year framework for the contributions to the PA” Sweden [00:12:15] “The 5-yearly ambition cycle is one of the cornerstones of the Paris agreement and we will need to ensure that it becomes as effective as possible in raising the global level of ambition to meet the long-term targets of the agreement. We should therefore show openness to support having five year timeframes. It’s important to note that a five year CTF from 2030 and onwards is entirely without prejudice to the timeframe of the EU internal targets of the post-2030 framework” France [00:17:42] “Lastly, FR thinks it is time for the EU to take a decision on the timeframe. We need to take a joint decision to ensure that we can participate constructively in the discussions which will take place at COP25. FR is in favour of a schedule which is in line with the Paris Agreement objectives – we need to make sure we are consistent and clear, so a five-year time for all NDCs.” Portugal [00:38:55]“The leadership role of the EU for climate action needs to be reflected in our NDC in keeping with the 5-year cycle for the PA.” [00:40:29]“We support the common time frames but we’re against transferring units to the Kyoto Protocol.” Belgium [00:52:44] “We have stressed the need to establish a CTF for all NDCs, but this far we have been pretty vague in our position, and that is why we haven’t been able to especially constructive in the negotiations” [00:51:53] “Now, FR and SE’s comments we can support them as well regarding the CTF, the CTF of 5 years for all NDCs as of 2030, we think that is best in line with optimally performing […] of the Paris Agreement” UK [01:00:30] “Further, the UK supports the inclusion of text that seeks agreement of a five year CTF for NDCs.” Malta [01:05:07] “On issues related to CTF for the NDCs, Malta is of the view that it is not yet time for such discussion to take place and would clearly prejudge future discussions” Germany [01:09:17]“… That is an important point for the next COP – as is the time frame. We think that it’s worth working towards a CTF, but as others have said, we need to have some flexibility here. We shouldn’t stick too fast to this, because this is still an open point” Luxembourg [01:15:37]“Thirdly, the EU needs to support a CTF for all parties and then with the review cycle from the PA, which I think would give us a dynamic for reviewing the NDCs which would be more effective and more transparent” Bulgaria [01:20:06] “As for the proposal to include text about a common five-year TF for implementing the NDCs, we’d like to stress that the current EU legislation effective for the period 2020-2030 is fully in line with the PA. At the same time, we believe it is extremely premature to discuss other timeframes post 2031. Therefore, we strongly oppose the introduction of a 5-year TF to execute the nationally determined programme.” Estonia [01:22:40]“In today’s discussions, there has been references to the CTF – I think it’s too early to reach any decision on this point” EC (closing remarks) [01:30:26]”The Commission does not see any reason to include additional text on the Common Time Frames, as this issue is not up for decision in Santiago.” [01:30:54]”Any language implying five-yearly greenhouse gas target setting for the European Union remains a decision outside the scope and mandate of the Environment Ministers.”
From its inception, in 2005, the ecbi has been based on the understanding that enhancing the capacity of the multilateral climate change regime to produce ambitious outcomes requires significant building and enhancement of trust between negotiators. Over the past five years, the ecbi Director has consistently argued that the well-being of the Financial Mechanism of the UNFCCC/Paris Agreement is key in generating such trust.[i] This is why the PCCB (Paris Committee on Capacity Building) and ecbi joined forces to organize a joint Seminar at COP 24 in Katowice to showcase ideas aimed at generating innovative additional contributions to the funds of the Financial Mechanism to enhance their longer-term viability.
This Seminar took place, with the financial support of the World Bank, on 8 December in the PCCB COP 24 Capacity-building Hub. The event was opened by Marzena Chodor, PCCB Co-chair, and Tomasz Chruszczow, Polish Special Envoy for Climate Change and UNFCCC Climate Champion. Following a number of showcase presentations, there was a panel discussion with representatives from civil society, sub-national governments, and multilateral financial institutions and funds (all of the contributions are to be made available as on-demand webcasts on the PCCB website). Daniele Violetti, UNFCCC Director, Finance, Technology & Capacity building, gave the closing address of the Seminar.
For the purposes of the Seminar, ‘multilateral climate finance’
was interpreted in terms of the Financial Mechanism of the Paris Agreement –
that is the Green Climate Fund, the Adaptation Fund,
and the Least
Developed Countries and Special
Climate Change funds, operated by the Global Environment Facility. ‘Innovative’,
in turn, was used to refer to sources other than the traditional budgetary
government contributions, be they on an ad hoc (‘voluntary’) or a multi-year
replenishment basis. Sources were divided into ‘top-down’ or ‘bottom-up’,
depending on government involvement (individually or collectively, and at
whatever level, i.e. multilateral, national, sub-national):
The International Air Passenger Adaptation Levy
(IAPAL): top-down (multilateral);
The Climate Damages Tax: top-down (multilateral);
The International Maritime Fuel Carbon Tax: top-down
The Western Climate Fund: top-down/bottom-up
The Corporate Air Passenger Solidarity Programme:
The International Air Passenger
Adaptation Levy (IAPAL)
The first top-down innovative source established for
multilateral climate finance was the share of proceeds of the Clean Development
Mechanism which was intended to be the main source of income for the Adaptation
Fund. In 2006, a Working
Paper by Benito Müller and Cameron Hepburn[ii]
put forward the idea of a solidarity levy on international air passengers for
the benefit the Adaptation Fund. Two years later this was taken up by the
UNFCCC Group of Least Developed Countries and submitted
as a proposal at COP 14 (Poznan, Poland) to establish an
International Air Passenger Adaptation Levy (IAPAL) for consideration under the
Bali Action Plan.
Achala Abeysinghe, Senior Strategic Adviser to the LDC
Group and Head of the ecbi Training and Support Programme, presented the LDC
Group IAPAL proposal. Following the very successful example of the French
‘Leading Group’ solidarity levy to combat HIV/AIDS, the Group proposed an
adaptation solidarity levy on international air passengers to provide more
adequate funding for adaptation activities in the poorest and most vulnerable
countries and communities.
The levy, collected by airlines at the point of ticket
sale, was earmarked for the Kyoto Protocol Adaptation Fund. It was to be
universal in the sense of covering all international air travel. Being
international and dependent only on the evolution of air travel demand, the
funds raised would truly be new and additional, as well as significantly more
predictable than traditional funding mechanisms.
The proposed levy would have no significant impact on
passenger numbers – its value representing less than a tenth of the expected
annual growth rate – and hence minimal to no negative impact on tourism-dependent
economies. In contrast, it would have significant positive impacts on the
development of the poorest and most vulnerable countries and communities, by
avoiding climate change impacts through the deployment of timely and adequate
adaptation measures funded using the revenue raised by the levy.
Responsibility for implementation. Airlines would
collect the levy from their passengers at the point of sale and transfer it to
a dedicated account of the Adaptation Fund. The airlines are compensated for
reasonable administrative costs incurred in the course of collection.
Revenue. In line with the French levy, the LDC Group proposal involved
a small passenger charge for international flights (USD6 per economy and USD62
per business/first class trip); it was estimated that this charge would raise
between USD8 billion and USD10 billion annually in the first five years
of operation, and considerably more in the longer term. By its very nature,
this revenue is not only new and additional to the traditional flows of
bilateral funding for adaptation, but also predictable due the stability of the
Justice considerations. According to
the LDC proposal, the proposed levy conforms to the idea of Common but
Differentiated Responsibilities and Respective Capabilities (CBDR/RC) with
respect to: (i) the personal responsibilities of passengers due to the
international emissions produced and (ii) their capability revealed by the ability
to fly internationally.[iii]
To reflect CBDR/RC at the national level, the revenue
raised in developing countries could be retained by them for their own
adaptation activities, with only the revenue from developed countries going to
the Adaptation Fund.
The Climate Damages Tax (CDT)
Julie-Anne Richards (Adviser, Climate Damages Tax
Coalition) gave a preview of a report on The
Climate Damages Tax (CDT), which she co-authored and launched
at COP 24 two days after the Seminar. The chief purpose of the proposed CDT is
to raise resources to pay for what has become known in the
multilateral climate change regime as ‘Loss & Damage’ (L&D). The first
time the UNFCCC negotiation texts referred to “unavoidable loss and damage from
the adverse impact of climate change” was in 2008 (see “Loss and damage
due to climate change An overview of the UNFCCC negotiations”). But
it was in 2013, at COP 19, that the issue was fully acknowledged through the
establishment of the Warsaw
International Mechanism for Loss and Damage associated with Climate Change
Impacts (WIM) “to address loss and damage associated with impacts of
climate change, including extreme events and slow onset events, in developing
countries that are particularly vulnerable to the adverse effects of climate
change”. Even though the WIM was given the mandate to enhance L&D finance,
there have hitherto been practically no resources been allocated for that
purpose. This was one of the main reasons for launching the Climate Damages Tax
campaign in April 2018.
The Climate Damages Tax (CDT) is a charge on the
extraction of each tonne of coal, barrel of oil, or cubic litre of gas,
calculated at a consistent global rate based on how much climate pollution (CO2e)
is embedded within the fossil fuel.
Responsibility for implementation. The CDT
proposal is to set up a solidarity facility for loss and damage, managed by the
GCF. Working with existing systems of payment, fossil fuel companies will pay
an extra amount on the volume they extract to the solidarity facility.
International law and precedents embodying the Polluter Pays principle (such as
the International Oil Pollution Compensation Fund) serve as a working example
of similar facilities.
Revenue. The proposal recommends that the CDT is introduced in
2021 at a low initial rate of USD5 per tonne of CO2e, increasing by
USD5 per tonne each year until 2030 to USD50 a tonne, with the expectation that
it is increased at the rate of USD10 per tonne annually after that to reach
USD250 a tonne by 2050. The increasing rate of tax will keep CDT revenue for
loss and damage at roughly USD300 billion a year over this period.
Justice considerations. The CDT would
raise funds for an international loss and damage solidarity facility, and also
raise revenue to support a just transition from fossil fuels to renewable
energy. This would help low-income communities and workers shift to carbon-free
jobs, energy, and transport, via a share of the CDT remitted back to the
country where the oil, coal, or gas was extracted. The share remitted to the
country of extraction varies between 50 per cent for rich countries, and 100
per cent for low-income countries, with a sliding scale between the two
ensuring that rich countries take the responsibility for funding loss and
The International Maritime Fuel
Kelley Kizzier (Independent Consultant) presented an IMF
Working Paper she co-authored on “Carbon Taxation for International
The purpose of the paper is to promote dialogue about the
possibility of a carbon tax as a key element of a GHG mitigation strategy for
international maritime transport, in the context of the April 2018
International Maritime Organization (IMO) pledge to cut emissions by 50 per cent
by 2050, relative to the 2008 level. The paper discusses the case for the tax
over alternative mitigation instruments, together with options for practical
design issues; it also presents estimates of the impacts of carbon taxation and
Responsibility for implementation. Maritime
carbon taxes could be collected domestically (through extending administrative
capacity for domestic fuel taxes), but the more immediately relevant option
(given delegation of GHG mitigation strategy to the IMO) would be an international
collection from ship operators (based on required reporting of their fuel
consumption). This could be achieved through the establishment of an
IMO-administered fund, following the precedent of the International Oil Pollution Compensation
(IOPC) Funds, established and overseen by the IMO. Operators could pay the tax
on either an annual or individual route basis, with denial of port access, or
ship arrest, for non-compliant operators being the potential enforcement
mechanisms. Under current practice, IMO members are mandated to enforce the IMO
convention — the tax could be paid to the fund, but any non-payment would be
enforced by states.
Revenue. A tax rising to USD75 per tonne of CO2 in
2030 (USD240 per tonne of bunker fuel), and to USD150 per tonne in 2040, is
estimated to raise revenues of about USD75 billion in 2030 and USD150
billion in 2040, while
increasing shipping costs by 0.075 per cent of global GDP in 2030.
Justice considerations. Compensation
mechanisms to reconcile the principle of CBDR/RC and the global application of
the maritime carbon tax (preferred due to the high mobility of the tax base and
the undesirability of introducing trade distortions), could be achieved by
remitting the carbon tax revenues to the GCF.
The Western Climate Fund
In December 2015 at COP21 in Paris, Quebec’s Premier
Couillard announced that CAD6 million of the revenue from Quebec’s auctions of
emission allowances under the Western Climate Initiative (WCI) –
the joint cap and trade scheme of Quebec and California – were to be
contributed to the Least Developed Countries Fund (LDCF) of the UNFCCC/Paris Agreement. At the
announcement, former US Vice President Al Gore expressed “deep gratitude,
admiration and congratulations” for Quebec’s initiative, which illustrates how
the wealthy regions of the world can reach out in partnership to the least
developed countries, enabling them to participate fully in solving the global
Benito Müller, ecbi Director, introduced a proposal to
build on this example by establishing a Western
Climate Fund (WCF) to receive contributions for the multilateral
funds of the Paris Agreement from states and provinces in or around the WCI. The
trans-national character of this ‘catchment area’ is important, as it would
guarantee that the Fund is not perceived as competing with national support,
but as being genuinely complementary to it. In order to assure predictability, the
Fund’s primary income is intended to come through innovative sources, in
particular from shares of proceeds of carbon price instruments, such as
emission trading schemes or carbon taxation, namely:
By participating in this initiative, sub-nationals can
contribute to the support needed by the globally poorest and most vulnerable to
enable them to combat global climate change while reducing poverty. This is not
just a moral imperative. Without such support, this fight cannot be won.
Responsibility for implementation. This depends
on the sub-national circumstances, and the source modality. Shares of
government revenue would most likely be collected by the relevant government,
while the monetization of shares of emission allowances might best be outsourced
to a not-for-profit entity.
Revenue. 2 per cent share of (expected) 2018 auction revenue:
Quebec USD10 million; California USD125 million.
Justice considerations. In
sub-national contexts, ‘climate justice’ is often focused exclusively on
domestic issues. The fact that, in the context of climate change, it is in the
interest of everyone to acknowledge that justice knows no jurisdictional
boundaries, will have to be explained to the domestic constituencies.
The Corporate Air Passenger
The ecbi Director also presented the Corporate Air
Passenger Solidarity (CAPS) Programme, launched in 2017 as part of the “Oxford
Crowdfunding for Adaptation Initiative”. The aim of the Programme is
to encourage corporate entities to contribute 1 per cent of their annual air
travel expenses to the Adaptation Fund of the Paris
Agreement, in social solidarity with the plight of the globally poorest
communities which are most vulnerable to the adverse impacts of climate change.
With the financial support of the Luxemburg government, the Programme aims to
establish a web-based platform for a ‘CAPS Partnership’ to be used in a
campaign to market the idea of contributing ‘Corporate Passenger Solidarity Donations’
to the Adaptation Fund.
Müller argued that, in the context of socially
responsible (corporate) air travel, the narrative on ‘climate neutrality’ needs
to be augmented. It can no longer only be a matter of carbon neutrality, that
is of purchasing voluntary carbon offset credits to mitigate ones flight
particularly given that, as of 2020, the industry will have its own
emissions reductions program. ‘Climate neutrality’, he maintained,
must also address the need to support the most vulnerable in dealing with the
adverse impact of climate change. In short, Müller suggested, the narrative in
question has to be re-defined as:
with CAPS contribution to the Adaptation Fund as an
effective and efficient solution to providing the latter.
Responsibility for implementation. The CAPS
Programme, with the support of the Adaptation Fund.
Revenue. A contribution of 1 per cent of corporate air travel
expenses – which corresponds roughly to the cost of offsetting – by 1 per cent
of corporate travellers would amount to over USD100 million per year,
and match the Adaptation Fund’s current annual income.
Justice considerations. Voluntary
There is an abundance of possible innovative sources for
multilateral climate finance, each with different characteristics regarding
potential scale, predictability, and political feasibility.
Unsurprisingly, multilateral top-down sources – namely
global taxes, levies, or ‘shares of proceeds’ – have a much larger revenue
potential than sub-national or bottom-up sources. As earmarked revenue streams,
they would also generally be more predictable than traditional budgetary
The ‘only’ drawback, as witnessed by the fate of the LDC Group IAPAL proposal,
is that in the past they did not command sufficient political buy-in to
Sub-national sources, such as the ones presented at the
PCCB/ecbi Seminar, have a much smaller revenue potential – which is why they
should probably be directed at the smaller funds of the Financial Mechanism, to
enable them to serve as multilateral ‘retail outlets’, with the GCF as the ‘wholesale’
fund (see “On
the Virtues of Strategic Divisions of Labour”). Their advantage is
that they depend less on political will because fewer, if any (as in the case
of the CAPS programme), governments are involved.
The one thing that all of these innovative options have
in common is that, in providing support to the Financial Mechanism of the Paris
Agreement, they help build trust among the Parties of the Paris Agreement. Trust
– albeit intangible – is the key ingredient in enhancing the Agreement’s overall
[ii] ‘IATAL — an outline proposal for an International Air Travel
Adaptation Levy’, Benito Müller and Cameron Hepburn, Oxford Institute for
Energy Studies Paper EV36, October 2006.
given the international character of the activities in question and of the
resulting emissions, the only equitable way to deal with the non-national
responsibilities for these activities is at the personal level, which – given
the price levels of international flights – also respects the idea of
respective personal capabilities.
[iv] ‘Two Unconventional Options
to Enhance Multilateral Climate Finance Shares of Proceeds and Crowdfunding’,
Benito Müller et al., ecbi.
[vi] The one exception is,
of course, the ‘share of proceeds’ of the CDM, and subsequently of the Art. 6.4
mechanism of the Paris Agreement. It is still extraordinary that this concept
was adopted, and it stands to reason that this only happened because it was not
called a ‘tax’ or ‘levy’ but was presented as a charge to cover the
administrative costs of the scheme.
Addressing the finance gap in sub-national contributions to the fight against climate change
By Anju Sharma
Nationalism and globalism are the polarising -isms of our times, replacing (according to bestselling author Yuval Noah Harari) even the traditional political divide of conservatism vs. liberalism. With nationalism on the rise again, innovative solutions have become necessary to address global existential challenges that no country can address on its own.
How, for instance, do we tackle a global existential threat like climate change in a world of rising nationalism? Multilateralism, in the form of the Paris Agreement, delivered only national determination as countries bunkered down and refuted any top-down, global determination of responsibility. But even this “global-lite” version of multilateralism was rejected by staunch nationalists in the US.
In response, globalists have rallied to offer sub-national action as an alternative. The Global Climate Action Summit (GCAS), which just took place in San Francisco, was a celebration of pledges from sub-national entities – cities, states, businesses, and individuals – to act against climate change. The Summit gathered an impressive list of commitments, from ambitious targets for carbon neutrality, to the use of green bondsand pension funds to build more climate resilient infrastructure and invest in renewable energy.
Although the pledges will not entirely make up the 28% reduction by 2025 (from 2005 levels) promised by the US under the Paris Agreement (which was already inadequate to meet the overall goal of the Paris Agreement to keep temperature rise within safe levels), they are important steps in engaging sub-national entities directly in the global fight against climate change.
A sub-national call to arms is not, however, a substitute for multilateral negotiations. As was evident at GCAS, such voluntary action may not heed the delicate balance of priorities that is necessary and can be achieved in a multilateral setting where all countries are formally represented.
For instance, the vast majority of ambitious announcements made at GCAS relate mainly to mitigation action – including target setting, and the US$ 4 billion pledged for mitigation by philanthropies. In the absence of adequate representation of the world’s most vulnerable, it is easy to forget that in addition to the “mitigation gap,” there is an adaptation gap, and a climate finance gap. This is recognised in the Paris Agreement, which includes a hard-won balance between adaptation and mitigation; and an emphasis on the importance of adequate finance for both mitigation and adaptation.
While a multilateral setting is essential to give equal voice to all, sub-national entities can still take a cue from the global negotiations and strive for more balance in their pledged action. A GCAS affiliate event on “Funding Climate Justice: Advancing Sub-National Action on Multilateral Climate Finance”, organised by Oxford Climate Policy (OCP), 350 Seattle, and Cool Effect on 14 September pointed to ways in which sub-national entities can contribute to the neglected area of climate finance – in particular to climate finance for adaptation, which is unlikely to attract private sector contributions.
As OCP Director Benito Müller pointed out while introducing the event, the multilateral negotiations are currently fraught with distrust – in particular, the discussions on climate finance. Sub-national entities can help dissipate the distrust by contributing finance that can be relied upon and is delivered through channels trusted by developing countries, such as the multilateral funds that serve the Paris Agreement.
Alex Lenferna, 350 Seattle, said California Governor Jerry Brown’s claim that the pledges made during GCAS would meet the US commitments under the Paris Agreement are not quite accurate. The commitments made for climate finance, critical for increased ambition in developing countries, have not yet been met. As one of the wealthiest countries in the world, and the country with high responsibility for climate change, he called on the US to contribute its fair share.
Three concrete ways in which sub-national finance could be raised were then presented at the event: individual contributions through crowdsourcing; individual contributions of tax refunds; and a “share of proceeds” from sub-national emissions trading.
Jodi Manning, Cool Effect, described a proposal for a crowdsourcing initiative, #STILLIN, that will allow individuals to pledge US$ 1 or more toward funding the gap caused by the current administration’s exit from the Paris Agreement. Contributions will be directed toward mechanisms such as the Adaptation Fund, she said, with an emphasis on supporting projects that directly help people most effected by climate change.
Massachusetts State Senator Mike Barrett then described a Bill he has authored, calling for a Massachusetts-UN Least Developed Countries Fund (MLDCF) to be established under Massachusetts state law. Describing the idea as “disarmingly simple”, Senator Barrett said the bill proposes to add a new “check-off” option to the six options involving other good causes that are already included on Massachusetts state income tax forms for the convenience of taxpayers who wish to make donations over and above their income tax obligations. He felt the idea had a good chance of going viral and travelling across state borders, as all 42 US states with a state income tax provide options for contributions on their income tax forms; and many US citizens would like to push back on the home-grown populism advocated by President Trump. The MLDCF would be legally constituted to receive other gifts, grants, and donations to the Fund as well, and all contributions would then be relayed to the UNFCCC’s Least Developed Countries (LDC) Fund.
Müller introduced the Western Climate Fund, a regional instrument proposed by OCP in collaboration with the Chair of the LDC Group, to collect “share of proceeds” from carbon policy instruments such as the sale of emission trading permits, or carbon tax revenue. He described efforts by OCP to bring on board the Canadian Provinces and US States of the Western Climate Initiative, with the aim of collecting funding for the multilateral funds serving the Paris Agreement. Québec, one of the states participating in the WCI, had already contributed Cdn$6 million to the LDC Fund during the Paris Climate Conference, Müller said, and efforts are underway to make this a more regular contribution on the basis of a fixed share of proceeds from trading, and from more states and cities. This could provide up to US$ 96-125 million annually, he estimated.
The three initiatives described at the meeting are “innovative sources” of climate finance. The idea of resorting to innovative solutions to fund sustainable development is at least as old as the Brundtland Commission report. Given the urgent threat that climate change poses, and the high estimates of finance needed to address this challenge, it is an idea whose time has come.
In the panel discussion that followed, facilitated by Achala Abeysinghe from the International Institute for Environment and Development, LDC Chair Gebru Jember explained why climate funds should be channelled through the financial mechanism of the UNFCCC, saying this will increase the chances of all countries accessing the funds (not only “donor darlings”); allow greater national determination of priorities; and enable the funds to be democratically governed by all countries, to ensure easier access. Tosi Mpanu-Mpanu, Board Member of the Green Climate Fund and former LDC Chair, agreed, saying certainty with international climate finance will allow developing countries to make their Paris Agreement contributions more ambitious.
Perhaps, then, sub-nationals can play a vital role in building a bridge between nationalism and globalism. But, as Heather Coleman from Oxfam America concluded at the meeting, addressing climate change will not only need divestment from fossil rules, but also investment, particularly in minimising climate impacts on poor and vulnerable populations.
In the climate negotiations, the issue of leadership has been of central importance from the very beginning. It has mainly been raised in terms of national (or EU) efforts to influence other countries (or groups of countries) with the aim of moving the negotiations forward and creating conditions for a satisfactory outcome. Of course, in all negotiations Parties try to defend their own interests; but negotiations on sustainable development have a special character: in many ways, and particularly in the long term, all parties are in the same boat.
As far as the EU is concerned, there is no doubt that the Union’s long-time commitment to support the Climate Convention has given it a leading position, particularly after the US 2001 decision not to ratify the Kyoto Protocol. In fact, the EU stance on climate change has been an important part of its display of “soft power” in international affairs. However, the present tensions within the EU and the Brexit negotiations limit the authority of the Union and reduce its capacity to act as a leader.
This is particularly unfortunate in view of the need for leadership on the Paris Agreement Work Programme. I recall that in March 2017 Benito Müller and myself published a Strategy Note dealing with the need for EU leadership through strategic collaboration with China and with other countries like India or Argentina. We also suggested two additions to the EU “tool kit” in the form of joint targets and option of coordination through a special envoy.
EU has tried to strengthen cooperation with China and Canada, and a couple of meetings have been held with these countries over the last years. Furthermore G 77 countries have met in various settings, the most recent one being the Johannesburg Declaration of the BRICS which underlines their countries’ commitment to implement the 2030 Agenda for Sustainable Development and the Paris Agreement. The Talanoa Dialogue is another element in the preparation for Katowice, and there will of course be other preparatory meetings. But the crucial question of decisive leadership like the one of France in preparing the Paris COP 2015, and the China/US strong cooperation at the time, all that remains very uncertain. I do hope that the ecbi Oxford meetings will promote positive ideas on the work to be undertaken over the next few months.
In addition, and based on my own experience, I believe that we need to underline that climate leadership is not only linked to positions of nations. Over the years, negotiations on sustainable development have benefited from the leadership of another character, namely the important actions of Secretariats and Chairpersons, beginning with the strong leadership in Rio 1992 of Maurice Strong as Secretary-General and Tommy Koh as Chairman of the UNCED Conference; and that of Jean Ripert as Chairman of the Negotiating Committee on Climate change, and the strong support of Michael Zammit Cutajar as Executive Secretary.
Looking back at the twenty-eight years I have been involved in the climate negotiations, beginning in 1990 as Chief Negotiator of Sweden in the decade up to 2001, then as an adviser to the Swedish delegation for a number of years, and finally as a retired but active observer of events. I feel there is a structural pattern which links science with politics, nations with individuals, failure with success; and ultimately a common feeling of responsibility for the real long term – 2100 and beyond.
The links between science and politics were established at the very beginning with the First Assessment Report of IPCC appearing four months ahead of the beginning of the negotiations of the Convention in early 1991. The presentation of the report by IPCC Chairman Bert Bolin of Sweden had a deep impact on the negotiators, and Bolin’s regular appearances over his ten years as IPCC Chairman made him one of the leaders in the process. Nevertheless, the negotiation of UNFCCC was several times on the brink of collapse, most seriously a few weeks before the Rio Conference: pessimism was deep, as we were facing a draft full of brackets; but Chairman Ripert was finally given a mandate to present a completely new text without brackets: he did so and also led the negotiation to a successful conclusion.
This was the first of a series of cycles of pessimism, followed by progress and success through strong leadership. The first came at COP 1 in Berlin in 1995: I chaired the negotiations for the Berlin Mandate, designed to set the stage for the Kyoto Protocol. At the level of officials, we managed reasonably well, but some crucial and decisive issues were beyond our reach and pessimism was growing. But in a final night of negotiations at ministerial level the Chair, a then rather unknown young German Minister of Environment showed her skills and turned the Conference into success. Her name was Angela Merkel. And two years later the resourceful Chair, Raoul Estrada of Argentina through strong leadership managed to reach agreement on the Kyoto Protocol.
However, the struggle for entry into force of the Protocol opened a new cycle of pessimism when the US in 2001 decided not to ratify the protocol, only a couple of months after a disastrous COP in the Hague, when Dutch Chairman, Environment Minister Jan Pronk, failed to get agreement on anything. However, the incoming EU Presidencies of Sweden and Belgium managed to solve the immediate crisis, and Pronk successfully chaired a resumed COP in Geneva in the summer of 2001, confirmed in the regular COP in Marrakech in late 2001.
The Kyoto Protocol was now “ratifiable”, but the rules for entry into force were compromised by the US exit. A new cycle of pessimism opened, but in 2004, Russia finally decided to ratify, and the Protocol entered into force in February 2005. However, the delay in entry into force would have repercussions that played a role in the next cycle of pessimism connected with the Copenhagen COP in 2009.
Expectations were high that autumn for a decision on a Second Commitment period for the Kyoto Protocol, especially since a summit at the very highest level would be held in connection with the COP with all the top leaders of the world invited. But the detailed preparations failed and pessimism grew as the Copenhagen COP unfolded. The bad organization of the summit at the end of the Conference seemed to confirm the failure, and the political document agreed – known as the Copenhagen Accord – was not well received. However, as we all know, Mexican and South African engagement and leadership in preparing the COPs in Cancún (2010) and Durban (2011) together with a growing understanding of the potential of the Copenhagen Accord changed the atmosphere and paved the way for the adoption of the Paris Agreement in 2015. A new cycle of optimism was then established by an efficient French Chairmanship with Foreign Minister Laurent Fabius and Ambassador Laurence Tubiana in the lead. The rapid ratification process and the early entry into force of the Agreement were then welcomed by all.
The optimism is still there but worries exist in the preparation of the entry into force of the new regime in 2020, in particular the Paris Agreement Work Programme. The next few months will be crucial, and therefore the discussions in Oxford this month are so important. As noted in the beginning of this paper the overall global prospects are not favourable, and the APA meeting in May left many questions open. The resumed meeting of subsidiary bodies in Bangkok September 3-8 and the continued Talanoa Dialogue will show whether the Paris enthusiasm is still there to enable constructive results in Katowice in December. No doubt the IPCC report on the 1,5 degree target will also have an impact in this connection.
My conclusion is that the implementation of the Paris Agreement may still be part of a positive cycle. However, the relative weakness of leadership on the side of the traditional big actors has to be compensated by strong support from business, finance and climate NGO’s. No doubt this year’s extreme weather conditions and all the disasters linked to them have had an impact on public opinion globally. But how much will this influence the negotiations? The Bangkok meeting is also an opportunity for the skillful and hard-working APA Co-chairs Jo Tyndall and Sarah Baasha to provide strong and constructive leadership and open the way for success at the moment of truth in Katowice in December. If this would happen it could open the way for a positive preparatory process for the Paris Agreement by 2020.
Let me return to a more long-term aspect of leadership, as the crucial implementation of the PA will develop in the period up to 2030 and beyond. It is a question of great political significance as the pattern of leadership and commitment will be facing and operating the new concept of NDC:s, which will bring national and international policymaking closer to each other. The management of a system of internationally binding procedural rules with commitments for action which are not binding internationally will require new thinking, new practices, and new flexibility. Perhaps the experience of OECD, which has been operating a system of this kind, could be helpful.
Ostensibly, the seed for the collapse was sown in the run-up to the meeting when some members felt that, contrary to their interpretation of due process, they were not sufficiently consulted by their constituency Co-Chair when the draft agenda for the meeting was put together. This, in conjunction with the fact that the constituency in question was unable to nominate a candidate from their ranks when their Co-Chair was unable to attend the meeting, led to an awkward late opening of the meeting followed by an unedifying agenda fight lasting until the end of day 2 (of a 4-day meeting!).
However, that is not all there is to it. This blog looks more closely at the issues that lie behind the collapse of B.20 and suggest a few things that might help to improve the Board culture, not least because I believe the time is now finally ripe to do something about it. Why? Given the dramatic failure of B.20, maybe there is a willingness by the Board to look into how a repeat performance can be avoided. So, in short, the purpose of this blog is to support the cultural revolution that is required for the GCF to do its job properly, not to say to survive.
The GCF, as it has evolved, has a couple of general governance problems that need to be addressed. To explain, consider the standard best practice corporate governance model, which distinguishes between three governance tiers: the executive, led by a CEO, the board of (non-executive) directors, and the company membership/shareholders. Each of these tiers has different functions. According to the G20/OECD Principles of Corporate Governance, the first responsibility of board members is that they “should be informed and act ethically and in good faith, with due diligence and care, in the best interest of the company and the shareholders.”
The first problem I have in mind is systemic, that is it is shared by many, if not most multilateral funds with a GCF-type governance structure: not only are all board members (representatives of) ‘shareholders’, but (of) shareholders with widely different, indeed in some cases, mutually incompatible interests. The only way in which Board members can serve the best interest of the ‘company’ is if they put the company interest first and their shareholder interest second. If this is not done, then everyone loses, as was painfully obvious at B.20 and was clearly not in the interest of the organization.
The second problem is more specific to the GCF governance culture as it has emerged over the years, namely the Board having developed a culture of ‘micro-management’, taking on tasks that in a mature organisation should be left to the executives.
What to do? In light of the antagonistic, or as one member called it “toxic” nature of the last Board meeting, it is not self-evident what could realistically be done to effect the required change in Board culture away from bi-polar negotiations to collective primary responsibility for the wellbeing of the Fund. So, the following suggestions are at best ‘baby-steps’, hopefully in the right direction.
Remedy One. Adopt the “2 Co-Chairs – 1 Board” (2-1) Model
In the course of the rather drawn-out opening of the meeting, Ayman Shasly (member of the Board from Saudi Arabia) made an intervention that sums up very nicely one of the key remedies I have in mind, namely that the two Co-Chairs are chairing the whole Board and not just a ‘constituency’. It would be good, in Shasly’s words, “if the two Co-Chairs were to treat us all as one constituency and not two constituencies [and] communicate equally, symmetrically, in unified communications to all Board members and alternate Board members. [The two Co-Chairs should use] one mailing list, to really demonstrate to the international community that this Board is one Board and is not divided over two constituencies. … I truly believe this is a good practice that we should establish under your leadership.”
To be fair, a similar sentiment was already included in the “Co-Chairs’ joint vision for 2018”, sent to GCF Board members and alternates in April 2018, which was “to strengthen the role of the Secretariat, to build bridges among Constituencies to strengthen the Board’s ability to operate as ONE BOARD [sic.] and to increase knowledge sharing between the secretariat and the Board.”
Shasly was rightly highlighting the fact that, according to the Rules of Procedure, the Co-Chairs are elected by the whole Board as Co-Chairs of the whole Board and not of some sub-set or other. Indeed, according to these Rules, the Co-Chairs, “in carrying out their function as Co-Chair, … shall be guided by the best interests of the Fund.” The only ‘constituencies’ for the Co-Chairs should be the Board as a whole and the Fund. To serve in this capacity, the Co-Chairs should be supported by a single joint team of advisers and they should not involve themselves in ‘constituency’ matters. Thus, should some members of the Board feel the need to coordinate among themselves, then they should do that by themselves, without involving the Co-Chairs and their support team.
In the same vein, the Board should look very carefully at what they can and cannot expect from the Co-Chairs, particularly in between meetings. Take the expectation that Board members should be consulted in the process of drafting meeting agendas. According to the Rules of Procedure, “the Secretariat will, with the approval of the Co-Chairs, prepare and distribute the provisional agenda for each meeting.” There is no mention about a Board member consultation.
The problem is that there has been a tendency among some of the previous Co-Chairs to involve themselves and the Board in micro-managing the Secretariat, which derived from a distrust by some Board members in the ability of the Secretariat to provide what they wanted without their direct supervision. However, it is clear that this sort of micro-management is not sustainable in the long run, which may also have been the reason why in their 2018 joint vision, the Co-Chairs stated that “we will increasingly rely on quality assurance systems inside the Secretariat, limiting Co-Chairs role in the preparation of Board meetings. In principle guidance will be provided as regards to modalities and structures for the yearly Board meetings including the daily organization of work as well as on documents and draft decisions with the Secretariat making the ultimate decision to release documents unless there are particular reasons to deviate from that principle.”
Micro-management by the Board may have been necessary while the Fund was being set-up. But the Fund is now grown up, and its executives need to be allowed to do the job they are, according to best practice, meant to. If the Board feels they are not doing their job properly, then the solution is for the Board to make sure they do, and not to take on the work themselves.
Remedy Two. Reduce ‘Airtime Inequ(al)ity’
The division between a ‘developing country-’ and a ‘developed country constituency’ derives from the multilateral climate change negotiations, but that does not mean that the adversarial culture is inevitable. After all, the Board of the UN Adaptation Fund (AF) is similarly structured, and it has managed to build a genuinely collegiate culture. So, what is the difference?
The AF Board has, from the outset, had the 2-1 model of chairing in the form of a single Chair and a Vice Chair (rotating between developed and developing country members), and it has over time given up the practice of constituency meetings. It has also, and I believe not unrelated to this, avoided to emulate the practice of UNFCCC plenary sessions, where each constituency has a spokesperson who is expected to make the intervention on behalf of the constituency, with other constituency members only meant to intervene in order to support the Chair’s statement. Unfortunately, the airtime patterns at B.20 reveal the sort of “airtime oligarchy” that one could expect in UN plenary sessions with a few members being given three to six times the average air time, and others well below average, if any at all. Fig. 1 represents the share of total webcast airtime of individual members at B.20 and Fig. 2 represents the percentage deviations relative to the average webcast speaking time.
This is not appropriate for a Board of equal members and, as witnessed in the reception of the B.20 deliberations outside the Board room, can lead to the perception of deliberate time wasting, with the effect that there was no time left to deal with actual project proposals and accreditations. It is not easy to see how this could be remedied short of introducing some measure to ‘incentivize’ the oligarchs to give up some of their disproportionate airtime usage (maybe through an effective guillotine on the time to be used in individual interventions).
Remedy Three. Introduce Activities & Accreditation Days at Board meetings
There is a very simply tool for avoiding the unacceptable situation of procedural wrangling eating into the time for deliberating activity (project/programme) proposals and accreditation requests. All it takes is to set aside a specific time period, say a day (or two) in the meeting for that purpose, in the way in which there are days set aside for constituency and committee meetings. As it happens, something similar was also envisaged in the Co-Chairs 2018 joint vision, as an “Advisory Day” to provide “an opportunity for advisors to discuss policy items and funding proposals with the Secretariat prior to the actual Board meeting with the purpose to increase knowledge on technical aspects of policies, as well as to identify and informally address possible concerns in order to streamline the decision making at the Board. A specific time slot will be dedicated for interactions with CSOs, private sector representatives and accredited entities.”
Although this would have been a step in the right direction – ultimately wasn’t to be because of push-back from some Board members – it wouldn’t have been exactly what I have in mind here. The days for discussing activity proposals and accreditation requests proposed here are not for advisers alone. They are meant to be for the discussion of these matters by Board members. Advisory Days as envisioned by the current Co-Chairs might still be useful as a preparatory exercise, but the Activities & Accreditation Days proposed here are intended to be the main locus of Board deliberations on these important issues. Having such days set aside outside the order of the agenda would ensure not only that the Board can actually perform one of its key duties: the scrutiny of proposals put before it for adoption. It would also enable the proponents of activities and the accreditation candidates to attend just these days, and not have to follow the remaining Board deliberations, which some of them may regard as not really worth their time. Having sat with the observers during B.20, it was absolutely clear that the Board cannot allow a similar fiasco to happen again without terminal reputational damage to the Fund.
 Except for the selection of candidates for Board Chairs and Vice-Chairs.
 In order not to unhelpfully point fingers at this point in time, I have decided not to identify either individuals or constituencies.
 Note that the sum of the bars is a measure of (airtime) inequality.
 I would like to thank Emmanuel Taiwo who was at B.20 with me and kindly offered to go through the web casts and list the durations of interventions.
 This still does not mean that airtime could not be hogged through repeated requests for the floor, but it might help to trim the airwaves from unnecessary rambling.
 I am fully aware that taking the deliberations on project and accreditation proposals outside of the sequencing of the meeting agenda might not be palatable to those who would like to use negotiation-style issue linkages to get ‘the other side’ to adopt what they want. Although I do not think that such ‘issue-linkages’ are in the interest of the Fund, the concerns of those who would want to continue to use them could be accommodated by including the actual formal decisions (not the deliberations) as part of the sequencing of the meeting agenda.
A little while ago, I attended an eventexploring the consequences of severe warming on physical and human systems at Oxford University Martin School, which was predicated on the need for “substantial changes in policy, production methods and consumption”.
Achim Steiner, then Director of the Martin School, spoke in his opening address about the need for a new ‘I-narrative’, where all of us need to ask ourselves what we can do individually to combat climate change – echoing, in a fashion, President Kennedy’s famous “ask not what your country can do for you, ask what you can do for your country”.
However, the first question in the subsequent Q&A was not about this new narrative, but about the role of ‘geo-engineering’, that is to say “methods that aim to deliberately alter the climate system to counter climate change”[IPCC AR5 SPM], such as solar radiation management and carbon dioxide removal.
While I have been rather sceptical about this type of physical intervention, the juxtaposition of the question with Steiner’s I-narrative made me think that perhaps we do need geo-engineering – only of a different kind: We need, as it were, geo-engineering of consumption, or to be more precise, of consumer aspirations and desires.
The idea that consumer behaviour needs to change is nothing new in the climate change arena. It is, after all, exactly what carbon price signals and regulations are meant to do, and there is no doubt that introducing a carbon price (reducing a carbon subsidy) generally does have an effect, as do simple prohibitions (banning incandescent light bulbs, drugs). But we need not go back to the 1920s to find examples that the effect may not be on demand, but on politics, namely to force a repeal of the measure in question. Using cost disincentives or prohibiting something altogether to change consumer behaviour are punitive tools that can backfire, particularly if they are seen to be disproportionate, unreasonable, or unfair. If, as recently reported, we would need a ‘sky-high carbon tax … to avoid climate catastrophe‘ then I fear we will be doomed if we put all our eggs in the carbon pricing basket.
What we need is to complement the punitive push with an aspirational pull on consumer behaviour in the right direction. Take the case of smoking. Smoking-rates in the UK have more than halved since the 1970. I am not in possession of the facts as to how much of this change in consumer behaviour was due to punitive push (excise taxes, smoking bans) as opposed to aspirational pull (education, advertising). Based on purely anecdotal evidence (my personal experience) smoking in my youth was ‘cool’ while my children see it as positively ‘uncool’ (one of the reasons that made me quit).
I do not know how exactly this change of consumer attitude came about, but it stands to reason that marketing and education must have been part of the equation. I am also convinced that marketing/public relations and education can be used to influence consumer aspirations with regard to more sustainable lifestyles. They must be used much more prominently to complement punitive tools if we are to avoid the climate catastrophe. In short, we need to ask ourselves …
…the billion-Euro question:
CCS plant, Boundary Dam, Canada
What is more effective in our fight of climate change, investing a billion into carbon capture and storage plant, or investing it in education and marketing?
Tania and Anisha Müller, Graduation, University College London
I have a hunch that the answer might be the latter, and I’m not alone in this. Just a couple of days ago, I met a UK parliamentarian and described this idea. He was intrigued, asking if any studies have been carried out on this. Unfortunately, I had to admit, I did not know, but I promised to try and find out. Hence this post.
Dear reader, if you have any relevant information, please let me know!
A few weeks ago, during a seminar here in Oxford, Antigua and Barbuda’s climate envoy told me about the considerable increase in hurricane frequency and impact she had experienced in her own life-time and the urgent need to make her country more resilient. Two days after her return home, the island of Barbuda was razed to the ground and made uninhabitable by hurricane Irma. It is difficult to conceive of an event that better illustrates the urgency for vulnerable countries to become more resilient to climate change related adverse impacts, in particular as they are predicted to continue increasing in frequency and severity due to climate change. This, and the fact that most of the particularly vulnerable countries are among the poorest in the world, yet bear a burden disproportionately high compared to the responsibility for having caused the problem, make it imperative that the more affluent (and responsible) provide financial support for them to become more resilient to the adverse impacts of climate change.
The Oxford Climate Policy ecbi Workshop
A workshop convened by OCP on behalf of the European Capacity Building Initiative (ecbi) at the recent subnational Climate Summit in Agadir, Morocco, highlighted the emerging role of sub-national contributions to multilateral climate finance. The aim was to create awareness and buy-in among sub-national actors (governments, corporations, individuals) of the nascent initiatives of sub-national contributions to multilateral climate funds, in particular the UN Least Developed Countries Fund (LDCF) and Adaptation Fund.
In his opening address, Ambassador Aziz Mekouar, Chief Negotiator for the Moroccan Presidency of the UN climate negotiations, highlighted the urgency in the context of the recent devastation caused in the Caribbean. He also pointed out the importance of multilateral climate funds by stressing that they “have a proven track record and are perceived by several countries a strong indicator of trust between parties (sic!). Alternative finance, such as sub-national contributions to multilateral climate finance can provide a very valuable complement to overall financial flows linked to the climate, in particular when it comes to the needs of developing countries.”
The theme of the disproportionate North-South ‘trust intensity’ – that is developing country trust gained or lost per dollar contributed or reneged on – of these multilateral funds in the context of the international climate change negotiations that led to the Paris Agreementwas taken up in my presentation on CSR Crowdfunding for the Adaptation Fund. I also argued that small multilateral funds are key to the functioning at scale of the overall multilateral financial mechanism in an essential division of labour (see reference  below): The Green Climate Fund(GCF), intended to be the main multilateral climate finance channel, will not function at the intended scale unless it becomes a ‘wholesaler’, outsourcing the funding of micro-activities through programmatic access  to in-country intermediaries (‘Enhanced Direct Access’), or through multilateral specialised niche retail funds such as the LDCF and the Adaptation Fund. It makes absolutely no sense to abolish (‘rationalise’) these small multilateral funds if they have to be re-invented to enable the GCF to work at scale.
The problem is that the LDCF and the Adaptation Fund, despite their proven track record, have not managed to attract the level of predictable funding that would enable them to fulfil their potential. The Adaptation Fund was designed to receive innovative finance from the market-based Clean Development Mechanism of the Kyoto Protocol, but that source has dried up because of a lack of market demand. It is now essentially dependent on voluntary contributions from national budgets, which poses a predictability problem . Yet there is room for a different form of innovative sourcing of contributions: the Adaptation Fund has a crowdfunding instrument, that is a ‘donate’ button on its website through which is can receive credit card donations. The idea of ‘CSR crowdfunding’  in this context is simply for corporations to donate one-percent of their air travel budget in recognition of the associated climate concerns. If ten percent of those corporates that already acknowledge these concerns by buying carbon offsets would switch to these CSR contributions, the Adaptation Fund would receive an estimated $120 million annually , which is more than its current voluntary contributions from national budgets.
Philip Gass of the Canadian International Institute for Sustainable Development (IISD) introduced the state of Canadian sub-national contributions to multilateral finance. In Paris at COP 21, the idea of sub-national contributions to multilateral climate funds (see ) had a first breakthrough with the announcement of a CAD 6 million contribution to the LDCF by the Province of Quebec , as part of an overall CAD 25 million commitment made to climate change support for developing countries.
Canadian provinces have considerable legal leeway to contribute to international climate finance. The federal government in Candada is also very supportive on such contributions over and above the national pledge (I believe it is indeed very important that any sub-national contributions are treated as additional to the national obligations and not as substitute).[i] Gass emphasised a number of reasons why sub-nationals should be interested in contributing to multilateral climate finance. Apart from the obvious moral imperative of showing solidarity with the plight of the poorest and most vulnerable by contributing to adaptation funding, and the resulting reputational gains, he highlighted the potential cost-effectiveness of mitigation activities in developing countries, and last but not least to secure ‘a seat at the table’, in particular in deliberations on how sub-national emission trading schemes could work together with the mechanism introduced in Article 6 of the Paris Agreement. He concluded that while there are some challenges, they can be overcome, particularly by using new and innovative finance sources, such as a small share of proceeds of trading scheme auctions or carbon taxes that would be seen as ‘new’ revenues and not reallocations of existing public spending. This might indeed be helpful, particularly in the forthcoming discussions on the compatibility of sub-national schemes with the Article 6 mechanism, which itself has earmarked a share of proceeds “to assist developing country Parties that are particularly vulnerable to the adverse effects of climate change to meet the costs of adaptation.” Finally, the policy backdrop in Canada to all of this is the Federal Government’s Pan-Canadian Framework on Clean Growth and Climate Change, which will see carbon pricing rates roughly doubly over the next five years, opening up additional revenue streams for international investment.
Massachusetts State Senator Mike Barrett, in his presentation, showcased a piece of Legislation enabling donations from U.S. taxpayers in the state of Massachusetts to the LDCF, as filed by him in the State Senate in March 2017 (MA Senate Bill No. 2056). The Bill makes use of the fact that the majority of states (41), including Massachusetts, allow tax payers to earmark (‘check-off’) a share of their tax refund on their personal income tax form as contribution to certain state programmes. It would create a Massachusetts UN Least Developed Countries Fund (MLDCF) to be replenished through such a tax refund check-off programme and any other public and private sector contributions for the benefit of the LDCF. Senator Barrett highlighted the ground-braking aspect of the check-off programme proposed in his bill, namely that it would be the first time that American tax payers would be given the option to express solidarity with a global concern in such a scheme.[ii] In essence, the MLDCF is a government-led crowdfunding instrument with a very special type of marketing tool: income tax forms. An important aspect of these schemes, as highlighted in the presentation, is that since tax payers are forced to look at the forms that contain these options, these check-off programmes, in marketing term, amount to a ‘push strategy,’ which given the current information overflow is much more effective that schemes where individuals have to go and actively ‘pull’ (search for) information on good causes to donate to.
Emilie Parry, Oxford Climate Policy and University of Oxford, concluded the event with an evaluation of The potential of sub-national contributions to multilateral finance from California, based on her recent factfinding tour in her home state. In the course of that tour, she consulted senior representatives of Governor Brown’s office and the California Environmental Protection Agency (CalEPA), the chair of the California Air Resources Board, the Mayors of Los Angeles and Santa Monica (California Climate Mayors Network), as well as legislators, private sector representatives and NGOs (in particular from the environmental justice movement). Based on these consultations, she found that there is considerable interest in, and good will towards providing financial support to the multilateral climate funds. The main question raised was how, given the fact that there are legal impediments to the California government spending money outside the state.
The presentation went on to discuss potential options of how the Californian government could facilitate contributions to the multilateral climate funds. Like Massachusetts, California has tax refund check-off programmes, and as the resources collected in this manner are not state income but charitable donations by individuals, the above-mentioned legal impediments should not apply. In any case, it should be relatively straightforward for the government to set up a charitable crowdfunding instrument – a ‘California International Climate Solidarity Fund’ – to collect donations from public and private-sector sources, including individuals, for the benefit of multilateral climate funds. Governor Brown’s September 2018 legacy Global Climate Action Summit in San Francisco would be the ideal space to express solidarity between Californians and the most vulnerable across the globe by launching such a crowdfunding instrument, maybe with some start-up contributions by kindred spirits expressing their solidarity also with the Governor’s vision of California being a climate change model sub-national. Over time, it might be possible to generate some innovative finance, say associated with the California Cap and Trade Programme (CCTP).[iii]Establishing such a crowdfunding solidarity fund at his 2018 Summit would cement Governor Brown’s legacy not only as an environmentalist but also as a humanist, as someone who cares about the poorest and most vulnerable in the world.
The Panel on American sub-national Action
Later the same day, another panel was discussing the mobilization of American stakeholders in the fight against climate change. Matt Rodriguez, California Secretary for Environmental Protection, began by emphasizing the fact that, as a founding member of a number of national climate change initiatives – We are still in the Paris Agreement, and America’s Pledge (meant to “compile and quantify efforts from U.S. states, cities, businesses and other actors to address climate change in alignment with the Paris Agreement”) – California takes greenhouse gas mitigation as seriously as ever irrespective of the pronouncements of the Trump administration on membership of the Paris Agreement. He also highlighted the need international collaboration in this context. Indeed, a week after President Trump announced his intention to withdraw from the Agreement, Governor Brown was in Beijing to sign an agreement to work together with China on “to expand trade between California and China with an emphasis on so-called green technologies that could help address climate change”[iv] Secretary Rodriguez, in this context, recalled a slogan that became prominent in the late 20 Century: “Think global, act local!”
However, America’s actual pledge extends beyond mitigation. It includes the provision of funding for developing countries not only to reduce their emissions, but also to build resilience to the adverse impact of climate change as a matter of urgency (as mentioned above). Given the growing isolationist tendencies of the current era, progressive forces must also act globally, or in the words of a recent OCP blog, they must “Think Local, Act Global!” This global action, the blog argues, must go beyond mitigation to include the provision of financial support for the poorest and most vulnerable across the globe.
Concurring with this sentiment, Senator Barrett shared what is happening in Massachusetts, including his innovative and ground-braking legislation proposal. However, if there was still any doubt about the importance of including financial support for multilateral climate finance in sub-national action agendas, it was dissipated by the closing intervention from Liane Schalatek (Heinrich Böll Stiftung North America), who was representing non-governmental stakeholders on the Panel. She focused her intervention exclusively on this, emphasising a range of options, from innovative financial tools such as earmarking a share of proceeds from emission trading auctions or carbon taxes, to crowdfunding. Her intervention made it abundantly clear that “Only in the presence of such support for the Paris finance mechanism can state governors truly make the claim: We Are Still In the Paris Agreement”, and that this needs to happen as a matter of urgency.
[i] This is of particular importance in the case of the current US ‘national debt’ to the GCF of $2 billion dollar. State and other sub-national contributions (cities, private sector, individuals) to the GCF, while extremely welcome, can be counted as being ‘American contributions’, but not as offsets to the contributions pledged and signed by the national government.
[ii] In 2015, there were a grand total of 410 tax check-off option available to American income tax payers, but all of them concerning domestic beneficiaries, ranging from non-game wildlife preservation to special Olympic programmes.
[iii] One possible way to get around the mentioned legal complications might be to follow the current practice under the CCAP to allocate allowances to utilities with California customers, for them to sell them and distribute the revenue to these customers. In other words, it should be possible to allocate a small share of the annually allocated allowances to an emission trading intermediary, with the mandate to sell them and transfer the revenue to the California International Climate Solidarity Fund.
US sub-national contributions to the financial mechanism of the Paris Agreement
By Benito Müller, Felipe Floresca, and Emilie Parry
There is a growing realization among US ‘sub-nationals’ – that is states, cities, corporations, counties, universities, grass-root networks, non-profit organizations, individuals (in essence, anyone outside the White House) – that climate change is a serious issue that needs to be tackled, and the withdrawal from the Paris Agreement by the Trump administration is viewed as a reckless act of geo-political vandalism.
The fact is, the Paris Agreement is necessary for us to come to grips with global climate change. Why? We need most, if not all, countries to ratchet up their emission reduction ambitions significantly if we are to get on top of the problem, and this requires international collaboration. Yet that will not be forthcoming if the global climate regime is seen to be blatantly unfair. A solution requires a lot of goodwill and good faith from everyone, and not only with regard to reducing emissions.
One of the key instruments of the Paris Agreement for this purpose is a number of multilateral funds collectively known as the Agreement’s ‘financial mechanism’. While the sums of money flowing through this mechanism are minuscule in comparison to the amounts that developing countries will have to spend themselves, the mechanism itself is of key importance for the international regime:
It serves as a beacon for the developed world – signalling to developing countries that their plight is recognized and appreciated.
It symbol character helps to reduce the prevailing sense of injustice which otherwise will scupper all efforts to enhance the worldwide mitigation ambitions that we all need to address climate change successfully.
With this in mind, the question then is how can ‘sub-nationals’ contribute to multilateral climate funding under the Paris Agreement? What can they do to minimize the erosion of global trust instigated by the Trump White House decision to renege on the contributions to the Paris financial mechanism signed up to by the Obama administration?
The most straightforward option, available to all, is the crowdfunding tool of the multilateral Adaptation Fund, collecting credit card contributions through a web ‘donate’ button.
US state governments could follow the precedent set by the government of the Canadian Province of Quebec which contributed CA$6 million to the UNFCCC Least Developed Countries Fund (LDCF) at the 2015 Paris climate summit. Alternatively, they could establish dedicated state-level ‘international climate solidarity funds’ to collect funding for the Paris financial mechanism. One example of this already underway is the ‘Massachusetts UN Least Developed Countries Fund (MLDCF)’, currently under consideration in the Massachusetts State Senate. This fund would be replenished through an income tax refund check-off programme and by a range of other public and private sector contributions, for the benefit of the LDCF.
In terms of demonstrating individual state efforts, and also to provide some much-needed funding predictability, the best way forward would be to create such state funds for the collection of donations from individual residents, city networks, corporate actors, as well as local and state governments. In the case of state governments, this would ideally be though earmarking a small share of some innovative source of revenue – such as carbon taxes or the proceeds of auctioning emission trading permits. For example, a bill currently under consideration in the California State Senate to modify the existing California Cap and Trade Programme envisages the distribution of emission permit auctioning revenue as ‘climate dividends’ to all residents on a per capita basis. In order to show solidarity with the world’s poorest and most vulnerable communities, California could then, for example, introduce a voluntary climate dividend check-off programme for the benefit of LDCs through the establishment of a California Least Developed Countries Fund, maybe with the additional provision that the climate dividends of the top x per cent of earners are mandatorily checked off in that manner.
Only in the presence of such support for the Paris finance mechanism can state governors truly make the claim: We Are Still In the Paris Agreement!