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Climate change is a global challenge and requires a global solution. Through analysis and dialogue, the Center for Climate and Energy Solutions is working with governments and stakeholders to identify practical and effective options for the post-2012 international climate framework. Read more

 

Decision-makers heed the Paris call to action

The following appeared in the September 2016 edition of Climate 2020, A UNA-UK publication providing analysis and recommendations on fulfilling the Paris Agreement on climate change

By Elliot Diringer, Executive Vice President, Center for Climate and Energy Solutions (C2ES)

Even before the landmark Paris Agreement has formally become international law, it’s clear that the signals sounded in Paris are reverberating with many of the real-world decision-makers who ultimately must deliver on its promise.

From investors like Warren Buffett to CEOs of top global companies to the mayors of many of the world’s largest cities, Paris is resounding as an unprecedented call to action. This ‘signalling effect’ is penetrating all levels of society, and may ultimately prove as decisive as the actions of national governments in determining the agreement’s success.

The Paris moment, and the ground-breaking agreement it forged, can accelerate the low-carbon transition in three different ways. The most direct is through the implementation of the intended nationally determined contributions (INDCs) that countries pledged in Paris. These lay out the country-specific goals and policies that will define national responses to the global climate challenge in the decade after 2020.

The Paris Agreement itself will drive further action through multilateral norms and mechanisms to promote international accountability and ambition. Stronger transparency rules, and the obligation to offer a new contribution every five years, will strengthen confidence that all countries are doing their fair share. This, in turn, can open political space for each to do more.

But the most immediate – if least direct – impact of the Paris Agreement is the internalisation by influential decision-makers of the imperative of a low-carbon transition. Among global challenges, climate change is unprecedented in the way it permeates virtually every facet of the global economy. It follows that an effective response demands action not just by national governments but at every level, from the local to the global, in both the public and the private spheres.

Action by cities, provinces and companies has been strengthening for some time. But these ‘non-state actors’ have remained largely disconnected from the UN Framework Convention on Climate Change (UNFCCC) – the central forum established by national governments nearly a quarter of a century ago to guide the global response.

That changed in Paris. With strong encouragement from the French conference hosts, thousands of mayors, governors, corporate chiefs and other leaders came to the UNFCCC meeting carrying their own commitments. Paris became a catalytic moment yielding an unprecedented showing of action at all levels.

Even more telling are the many ways in which the signals sounded in Paris continue to resound. Among many investors, Berkshire Hathaway CEO Warren Buffett’s annual letter to shareholders is greeted as a near-oracular event. In his letter this year, Buffett cited Paris as a further impetus for the multibillion-dollar investments that have made his company one of the largest generators of clean power in the US.

Larry Fink, CEO of BlackRock, the world’s largest manager of assets (worth some $4.6 trillion), similarly highlighted the Paris Agreement in a letter urging the CEOs of S&P 500 companies to focus more on long-term value creation and less on short-term gains.

There have also been some other encouraging signs since Paris: A dozen companies, including Bloomberg, HP and Tata Motors joined an existing group of 58 others, including Google, Nestlé and Coca-Cola, in committing to move to 100 per cent renewable energy.

In May, declaring Paris a “watershed” moment, Total CEO Patrick Pouyanné said the French oil giant will base future investment decisions on a 2°C scenario, pulling back from investments in tar sands and the Arctic, and shifting its portfolio towards renewables.

Banks including JPMorgan Chase and Goldman Sachs established new lending practices or new funds favouring clean energy over fossil fuels. And a consortium of financial institutions and investors are partnering under the Catalytic Finance Initiative, originally launched by Bank of America, to direct $8 billion towards sustainable investments.

In a move bound to ripple across many sectors, the Moody’s credit rating agency announced in June that it was building countries’ Paris pledges into the baseline scenario it uses to rate public and private-sector investments.

Mayors also are reading Paris as a cue for stronger climate action. In June, two groups merged to form the Global Covenant of Mayors for Climate & Energy, comprised of the leaders of more than 7,000 cities, large and small, in 119 countries. The mayors pledged to set goals going further than their countries’ respective national commitments.

To strengthen the rigour and credibility of their contributions, the mayors’ group and others are establishing methodologies to track actions and measure their emissions impact. A loose network of non-state constituencies have begun planning their own summit to showcase their efforts in mid-2018, as national governments prepare to take stock of global progress.

That the signals from Paris are being so widely received – and amplified – reflects a dramatic evolution in the global climate effort. The multilateral struggles of national governments may still occupy centre stage, but the annual UN climate conferences are becoming more inclusive affairs, welcoming and capitalising on the energies of other influential players.

This activation of investors and multinational companies, and of elected leaders responsible for the everyday concerns of millions around the globe, will likely be a key component of Paris’s success.

Leading up to Paris, the surge of commitments by non-state actors helped embolden governments to offer up ambitious INDCs. In the years ahead, it will in many countries fall to business and to subnational leaders, as much as to national governments, to ensure that these national contributions are fulfilled.
Indeed, over the long haul, the more deeply the Paris goals are embedded in corporate and subnational decision-making, the better they will withstand the political and economic currents that may distract national leaders from the imperative of the low-carbon transition.

At the next UNFCCC conference in Marrakech, parties may look at ways to strengthen the engagement of non-state actors going forward. They could, for instance, play a role in the ‘global stocktake’ that will take place every five years. Or governments could grant permanent status to the Non-State Actor Zone for Climate Action (NAZCA) portal, an online registry launched before Paris that now contains commitments from more than 11,000 cities, regions, companies, investors and civil-society organisations.

But more important than any formal role for mayors and CEOs in the UN process ?is the continued uptake of the signals Paris is sending.

 

International Civil Aviation Organisation (ICAO)

Governments are working toward a new international agreement in October 2016 to limit greenhouse gas emissions from aviation. Airline emissions account for 2 percent of global greenhouse gas emissions and, without stronger measures, could triple by 2050.

In 2010, the International Civil Aviation Organisation (ICAO), the United Nations body that governs civil aviation, set a goal of carbon-neutral growth starting in 2020. At the upcoming ICAO Assembly in Montreal, member states will consider two policies to meet the carbon-neutral goal: international CO2 standards for aircraft; and a market-based mechanism to offset aviation emissions with reductions in other sectors.

Meeting the carbon-neutral goal will require efficiency improvements to reduce fuel use, new alternative fuels, operation improvements, and infrastructure upgrades.

CO2 Standards for Aircraft

IIn February 2016, the ICAO Committee on Aviation Environmental Protection (CAEP) gave preliminary approval to a CO2 standard for new aircraft, set to be formally adopted at the Assembly in September. The standard would effectively mandate that each new generation of aircraft continue to achieve the 15-20 percent fuel efficiency gains seen in recent generations.

The standard would apply in three stages. From 2020, all new aircraft designs would have to comply with the new standards. From 2023 to 2028, all aircraft models currently being produced would have to meet a less stringent “in-production” standard if they undergo modifications requiring re-certification. From 2028, all new aircraft would have to meet the full standards.

Virtually all aircraft types in the global commercial fleet would be covered by the CO2 standard, which applies a complex formula based on fuel use during the “cruise” portion of a flight, adjusted for fuselage size.

A Market-Based Mechanism

Governments are working with the airline industry to design a market-based mechanism enabling airlines to offset increased emissions with reductions in other sectors. With air travel projected to continue rising rapidly, airlines are expected to rely heavily on offsets to achieve carbon-neutral growth. The World Bank estimates demand for offsets to reach 250 MtCO2e by 2030 and a cumulative 13-20 GtCO2e by 2050.

Issues that must be decided include:

  • How 2020 level emissions are apportioned among countries and across different flight routes, which has significant implications for the number of offsets each airline will need to acquire.
  • A process for determining what kinds of offsets are permitted and for approving them.
  • Accounting procedures to ensure that reductions used to offset airline emissions are not credited toward other emission-reduction goals.

In September 2016, the ICAO Council produced a draft resolution for the market-based measure – named the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA). This draft resolution has been submitted for approval at the ICAO Assembly, which includes all ICAO member states, in October 2016. A number of issues remain open. These are the main features of the proposed CORSIA:

  • It would commence with a pilot phase from 2021 to 2023, followed by a first phase from 2024 through 2026, and a second phase from 2027 through 2035. In the pilot and first phases, participation will be voluntary. The United States, China, Canada, Mexico, and 44 European countries have indicated they will participate during the voluntary phase. In the second phase, all states not exempted (see below) would be required to participate.
  • Exemptions from the second phase would apply to least developed countries (LDCs), small island developing states (SIDS), landlocked developing countries (LLDCs) and those with a share of international aviation below 0.5 percent in 2018.
  • Offset requirements during the pilot phase either could be calculated either on the basis of an operator’s emissions during the given year (e.g. 2021-level emissions in 2021), or could refer back to 2020 emissions throughout the pilot phase. Each participating state would choose between these approaches.
  • In the pilot phase, first phase, and the first two years of the second phase (i.e. from 2021 to 2029) the distribution of offsetting requirements would be completely on the basis of the growth rate of the sector overall, rather than each individual airline’s growth rate. This ratio would change over time, however. In 2030 to 2032, 20 percent would be on the basis of an individual airline’s growth rate, and the rest on the basis of the sectorwide rate. From 2032 to 2035, 70 percent of an operator’s offset requirement would be based on its individual growth.

Achieving the United States' Intended Nationally Determined Contribution

Achieving the United States' Intended Nationally Determined Contribution

Last updated: September 2016

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More than 180 nations representing more than 95 percent of global greenhouse gas emissions offered “intended nationally determined contributions” (INDCs) to the Paris Agreement reached in December 2015. The United States’ INDC is an economy-wide target to reduce net greenhouse gas emissions 26 to 28 percent below 2005 levels by 2025. Available analyses suggest that the United States could reduce emissions by more than 22 percent with policies either already in place or soon anticipated. Options for achieving further reductions to meet the 2025 target may include additional policies, technological advances, and stronger action by cities and companies. Concerted efforts across multiple fronts could reasonably produce the reductions needed to meet the goal. Specifically, this paper looks at the progress that has been achieved since 2005, the effect existing and proposed policies will have by 2025 as well plausible steps to fill the gap.

Doug Vine
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Bob Perciasepe's statement on US & China joint approval of the Paris Agreement

Statement of Bob Perciasepe
President, Center for Climate and Energy Solutions

September 3, 2016

On the United States and China formally adopting the Paris Agreement on climate change:

It’s remarkable that in a few short years the world’s two leading climate antagonists have become the world’s two leading climate champions. The United States can no longer claim that China’s inaction is an excuse to do nothing, and vice versa. With both again committing themselves to a low-carbon future, the two countries are setting an example the rest of the world can hardly ignore.

The Paris Agreement not only commits all countries to do their best to combat climate change, but provides us the tools to hold them accountable. Stronger transparency rules will make clear whether countries are keeping their promises and contributing their fair share to the global effort. And, by requiring countries to update their contributions every five years, the agreement will work to strengthen ambition over time.

As national governments take the steps necessary to bring the agreement into force and to implement their commitments, it’s clear that the Paris signal is also resounding with other leaders who are critical to achieving its promise. Mayors, governors, CEOs and investors are all taking steps to cut emissions and expand clean energy. The more deeply the Paris goals are embedded in real-world decision-making, the better they will withstand shifting political and economic currents, and the better our prospects for a low-carbon future.

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For more information on the Paris Agreement, see www.c2es.org/international/paris-agreement

To speak to a C2ES expert, contact Laura Rehrmann at rehrmannl@c2es.org, or 703-516-0621

About C2ES: The Center for Climate and Energy Solutions is an independent, nonpartisan, nonprofit organization advancing strong policy and action to address climate change. Learn more at www.c2es.org.

The enduring power of US-China climate leadership

US-China FlagsIt would have been hard to imagine just a few short years ago that the United States and China would – together – be the ones driving a stronger global response to climate change.

For years, each claimed inaction by the other as an excuse for not doing more. But with their simultaneous acceptance today of the Paris Agreement, the world’s two largest economies and emitters committed themselves to a low-carbon future, and solidified a new global framework that will keep pressure on all countries to keep doing more.

The precise mix of motivations varies between the two. But fundamentally, the heads of both the United States and China have assessed the risks and opportunities presented by climate change, and they have decided it is in their nations’ interests – and is their responsibility as global leaders – to do more.

How faithfully the two countries now follow through on their commitments will depend in part on a host of shifting political and economic currents, and who assumes the reins in the years ahead.

But with their leadership up to and since last year’s Paris conference, the United States and China have helped establish new mechanisms and unleash new energies that ensure a staying power beyond the comings and goings of individual governments.

With the Paris Agreement, countries have applied the lessons of a quarter-century of fitful climate diplomacy to create a new framework that offers the best hope ever of an effective international response.

The agreement binds countries to a set of processes requiring them to: tell the world how they’re going to fight climate change; report regularly on how well they’re doing; undergo review by experts and by other countries; and, every five years, say what they’ll do next.

It is, in essence, institutionalized peer (and public) pressure. And if it works as designed, the agreement will over time strengthen confidence that countries are doing their fair share, making it easier for all to do more.

Beyond the agreement itself, and the role of national governments, Paris also will keep nurturing stronger action through its powerful “signaling” effect. For many mayors, governors, CEOs and other real-world decision makers, Paris was a catalytic moment, and its signals continue to resound.

From Warren Buffett, who cited Paris in his annual letter to shareholders as further impetus for Berkshire Hathaway’s multibillion-dollar investments in renewable power, to Moody’s, which is now taking countries’ Paris pledges into account in rating future investments, mainstream business is internalizing the Paris goals.

Mayors, too, are reading Paris as a cue for stronger action. In a new Global Covenant of Mayors for Climate & Energy, more than 7,000 mayors in 119 countries pledged to set climate goals beyond those of their national governments. C2ES recently joined with The U.S. Conference of Mayors to form the Alliance for a Sustainable Future, bringing mayors and business leaders together to forge collaborative approaches to cutting emissions.

In the long run, this activation of mayors, CEOs and other “non-state actors” could prove as decisive as the actions of national governments in determining the success of Paris.

No one moment and no one agreement can ensure the long-term transformation needed to keep climate change in check. But today’s U.S.-China announcement is the latest in a series of breakthrough moments that could mean the difference between a successful low-carbon transition and a future of climate calamity.

 

 

 

Paris Climate Talks Q&A

Paris Climate Talks Q&A

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More than 190 nations meeting in Paris in December 2015 reached a landmark agreement to strengthen the global climate effort. The Paris Agreement commits countries to undertake “nationally determined contributions” and establishes mechanisms to hold them accountable and to strengthen ambition in the years ahead.

C2ES offers a summary of the key outcomes in Paris and other resources related to the climate talks. Here are answers to some frequently asked questions.

What’s the status of the Paris Agreement?

The treaty will enter into force when it has been formally accepted by 55 countries accounting for 55 percent of global greenhouse gas emissions. This is a two-step process: countries first sign the agreement, and then complete domestic ratification or approval procedures. With its formal acceptance by the United States and China, the agreement has now been ratified by 27 countries with 39 percent of global emissions, and it appears increasingly likely that the threshold for entry into force will be met in late 2016 or in 2017.

The Paris conference was the 21st session of the Conference of the Parties to the U.N. Framework Convention on Climate Change (UNFCCC), known as COP 21. The conference concluded a round of negotiations launched in Durban, South Africa, in 2011 with the aim of producing a new legal agreement among national governments to strengthen the global response to climate change. A record 150 heads of state and government attended the opening day of the conference.

What were the main outcomes of the Paris conference?

The Paris package had three main components: the Paris Agreement, an international treaty setting common goals, commitments and expectations; the intended “nationally determined contributions” (NDCs) submitted by more than 180 countries; and the thousands of contributions offered by companies, states, cities and civil society organizations.

How does the Paris Agreement relate to the UNFCCC?

The UNFCCC, adopted in 1992, is a treaty among governments that provides a foundation for the global climate effort. Enjoying near-universal membership, the convention was ratified by the United States with the advice and consent of the Senate. The convention set a long-term objective (avoiding “dangerous human interference with the climate system”), established principles to guide the global effort, and committed all countries to “mitigate” climate change by reducing or avoiding greenhouse gas emissions. The Paris Agreement defines how countries will implement their UNFCCC commitments after 2020.

What are nationally determined contributions?

In 2013, at COP 19 in Warsaw, parties were encouraged to submit their “intended nationally determined contributions” (INDCs) to the Paris Agreement well in advance of COP 21. These INDCs represent each country’s self-defined mitigation goals for the period beginning in 2020. To date, 189 countries accounting for almost 99 percent of global emissions have submitted INDCs to the UNFCCC secretariat.

Developed countries have offered absolute economy-wide emissions targets (the United States, for instance, has pledged to reduce its emissions 26-28 percent from 2005 levels by 2025). Developing countries have offered a range of approaches, including absolute economy-wide targets, reductions in emissions intensity (emissions per unit of GDP), reductions from projected “business-as-usual” emissions, and reductions in per-capita emissions. C2ES has produced a summary of countries’ INDCs.

Final NDCs are submitted by each party upon its formal ratification or acceptance of the agreement, and are recorded in a UNFCCC registry.

What obligations do countries have under the agreement to reduce their emissions?

The Paris Agreement establishes a set of binding procedural commitments. Parties commit to “prepare, communicate and maintain” successive NDCs; to “pursue domestic mitigation measures” aimed at achieving their NDCs; and to regularly report on their emissions and on progress in implementing their NDCs. The agreement also sets the expectation that each party’s successive NDC will “represent a progression” beyond its previous one and “reflect its highest possible ambition.”  The achievement by a party of its NDCs is not a legally binding obligation.

Does the agreement meet the goal of limiting warming to 2 degrees Celsius?

In agreements adopted in Copenhagen in 2009 and Cancún in 2010, governments set a goal of keeping global temperature increases below 2 degrees Celsius above pre-industrial levels. The Paris Agreement reaffirms the 2-degree goal, while urging efforts to limit the increase to 1.5 degrees Celsius. The agreement also sets two other long-term mitigation goals: first, a peaking of emissions as soon as possible (recognizing that it will take longer for developing countries); then, a goal of net greenhouse gas neutrality (“a balance between anthropogenic emissions by sources and removals by sinks”) in the second half of the century.

Analyses of the INDCs submitted by countries conclude that, while they move us closer to the 2-degree goal, they are not ambitious enough to achieve it. An analysis by the Climate Action Tracker, a consortium of research institutions, concluded that the INDCs, if fully implemented, could result in warming of 2.7 degrees Celsius, which would be 0.9 degrees lower than without them.

How will the Paris Agreement get countries to increase their ambition?

The Paris Agreement provides a durable framework guiding the global effort for decades to come. The aim is to create a continuous cycle that keeps the pressure on countries to raise their ambition over time. To promote rising ambition, the agreement establishes two linked processes, each on a five-year cycle. The first process is a “global stocktake” to assess collective progress toward meeting the agreement’s long-term goals. Parties will then submit new NDCs, “informed by the outcomes of the global stocktake.”

Because the Paris Agreement is to apply post-2020, the first formal stocktake under the agreement will not take place until 2023. But under a decision accompanying the agreement, parties will jumpstart the five-year cycle with a “facilitative dialogue” on collective progress in 2018, and the submission by 2020 of NDCs running through 2030.

How will parties be held accountable?

Accountability will be achieved primarily through an “enhanced transparency framework.” All countries are required to submit emissions inventories and the “information necessary to track progress made in implementing and achieving” their NDCs. These reports will be subject to an independent review by technical experts and a “facilitative, multilateral consideration of progress” by fellow governments.

Unlike the current transparency system under the UNFCCC, which sets different requirements for developed and developing countries, the new transparency framework will apply to all countries but provide “built-in flexibility” to accommodate varying national capacities. The aim is for all parties to work toward the same standards of accountability as their capacities strengthen over time.

In addition, the agreement establishes a new mechanism to “facilitate implementation and promote compliance.” This “non-adversarial” committee of experts will seek to help countries falling behind on their commitments get back on track. There are no penalties for noncompliance.

How does the agreement address climate adaptation?

Adaptation—steps to cope with the impacts of climate change—receives much greater emphasis under the Paris Agreement than previously under the UNFCCC. Just as parties will submit mitigation contributions, the agreement requires all parties, “as appropriate,” to plan and implement adaptation efforts and encourages all parties to report on their adaptation efforts and/or needs. The agreement also includes a review of adaptation progress, and the adequacy and effectiveness of adaptation support, in the global stocktake to be undertaken every five years.

What does the Paris outcome do to support the efforts of developing countries?

Developed countries committed under the UNFCCC to support mitigation and adaptation efforts in developing countries. As part of the Copenhagen and Cancún agreements, developed countries committed to mobilize $100 billion a year in public and private finance for developing countries by 2020.

The Paris Agreement reaffirms developed countries’ UNFCCC obligations; the COP decision accompanying the agreement extends the $100 billion-a-year goal through 2025, and calls for a new goal beyond that “from a floor of” $100 billion a year. The agreement also broadens the donor base beyond developed countries by encouraging other countries to provide support “voluntarily.” China, for instance, recently pledged $3 billion to help other developing countries.

Many national governments offered new financial pledges in Paris. Collectively, developed countries pledged $19 billion to help developing countries, including an announcement by Secretary of State John Kerry that, by 2020, the United States will double its support for adaptation efforts to $800 million a year. In another sign that developing countries are now also providing support, Vietnam pledged $1 million to the new Green Climate Fund (GCF). And for the first time, subnational governments also offered pledges, including 1 million euros from the city of Paris for the GCF, and CAD 6 million from Quebec for the UNFCCC Least Developed Countries Fund. As of June 2016, $10.3 billion has been pledged to the Green Climate Fund from 43 governments.

Does the Paris Agreement address carbon markets?

Many countries indicated in their INDCs that they intend to use some form of international emissions trading to implementing their contributions. To ensure the environmental integrity of such transactions, the agreement requires parties to follow accounting practices avoiding the double counting of “internationally transferred mitigation outcomes.” In addition, the agreement establishes a new mechanism contributing to mitigation and supporting sustainable development, which, depending on its design, could generate or certify tradable emission units.

How did the Paris conference engage stakeholders such as states, cities and business?

Although only national governments participate directly in the negotiations, COP 21 provided many opportunities to showcase the contributions of “non-state actors” to the global climate effort. The strong display of commitments by cities, subnational governments and businesses at the New York Climate Summit in September 2014 led to the establishment at COP 20 of the Lima-Paris Action Agenda and the online NAZCA portal, where non-state actors can register their commitments. By the time of Paris, the portal listed nearly 11,000 commitments from 2,250 cities, 22,025 companies, and hundreds of states/regions, investors and civil society organizations. The unprecedented showing of action and support from all levels of society was widely credited as an important factor in Paris’ success.  Governments and stakeholder groups are working to strengthen non-state contributions to the UNFCCC.

Is the agreement legally binding?

Yes. The agreement is considered a “treaty” under international law, but only certain provisions are legally binding. The issue of which provisions to make binding was a central concern for many countries, in particular the United States, which wanted an agreement the president could accept without seeking congressional approval. Meeting that test precluded binding emission targets and new binding financial commitments. The agreement, however, includes binding procedural commitments – such as the requirements to maintain successive NDCs and to report on progress in implementing them.

Will Congress have any say over the agreement?

Under U.S. law, a president may under certain circumstances approve U.S. participation in an international agreement without submitting it to Congress. Important considerations include whether the new agreement is implementing a prior agreement such as the UNFCCC that was ratified with the advice and consent of the Senate, and whether it is consistent with, and can be implemented on the basis of, existing U.S. law. Because the agreement does not include binding emission targets, or binding financial commitments beyond those contained in the UNFCCC, and can be implemented on the basis of existing law, the president could choose to approve it by executive action.

A C2ES legal analysis examines issues surrounding U.S. acceptance of the Paris Agreement.

Could a future president withdraw the United States from the agreement?

Under U.S. law, U.S. participation in an international agreement can be terminated by a president, acting on executive authority, or by an act of Congress, regardless of how the United States joined the agreement. The Paris Agreement specifies that a party may not withdraw from the agreement within the first three years following its entry into force.

What happens next?

As countries undertake domestic procedures to formally accept the Paris Agreement, they they also are expected to continue moving forward with the domestic policies needed to implement their nationally determined contributions.

At the same time, governments are negotiating the details of how the Paris Agreement will be implemented – for instance, accounting rules and accountability procedures.  These decisions are likely to be finalized by 2018.  The next major UNFCCC conference, COP 22, will take place in Marrakech, Morocco, in November 2016. 

Post-Paris transparency under the United Nations Framework Convention on Climate Change

The following article appeared in the July 2016 issue of the American Bar Association International Environmental and Resources Law Committee Newsletter.

By Jennifer Huang, International Fellow, Center for Climate and Energy Solutions (C2ES)

Introduction

Parties to the United Nations Framework Convention on Climate Change (UNFCCC, or Convention) reached a landmark agreement on December 12, 2015 in Paris, charting a fundamentally new course in the global climate effort.  A central issue in the negotiations was strengthening transparency requirements to better hold countries accountable for their commitments.  Moving beyond the strict differentiation between developed and developing countries that characterized earlier efforts under the Convention, the Paris Agreement establishes an enhanced transparency framework with “built-in flexibility” to accommodate varying national capacities.  For the first time, all parties must report regularly on their emissions and implementation efforts, and undergo international review.  These transparency mechanisms will provide information necessary to track parties’ progress in implementing their nationally determined contributions to the new treaty, and will help strengthen parties’ capacities to measure and understand their own efforts.  By building mutual trust, they also can help strengthen the overall climate effort.

The Paris Agreement promises support to help developing countries meet the new requirements and allows them flexibility in the scope, frequency, and detail of their reporting, and in the extent of review of their communications.  Deciding the nature of that flexibility will be a primary focus of continuing negotiations on the detailed rules for implementing the agreement.

Existing UNFCCC transparency framework

Existing transparency requirements under the UNFCCC differ for developed and developing countries.  Parties to the Convention must submit national communications (NCs) on their mitigation and adaptation actions every four years, though the required content differs for developed and developing countries. United Nations Framework Convention on Climate Change [hereinafter UNFCCC] art. 12, May 9, 1992, S. Treaty Doc No. 102-38, 1771 U.N.T.S. 107 (entered into force Mar. 21, 1994).  To enhance reporting on national greenhouse gas (GHG) inventories and efforts to implement the requirements of the Convention, agreements reached in 2010 at Cancun established two parallel processes: one for developed countries, and a less stringent one for developing countries. UNFCCC, Conference of the Parties, Seventeenth Session, Durban, S. Afr., Nov. 28 – Dec. 11, 2011, Decision 2/CP.17: Outcome of the Work of the Ad Hoc Working Group on Long-term Cooperative Action under the Convention, U.N. Doc. FCCC/CP/2011/9/Add.1 (Mar. 15, 2012). 

Under International Assessment and Review (IAR), developed country parties enhance the reporting in their NCs through the submission of biennial reports (BRs), which outline their progress in achieving emission reductions and the provision of financial, technological, and capacity-building support to developing country parties. Developed countries undergo a technical review of their national reports, in which technical experts review the annual GHG inventories, examine the technical information on emissions and removals, and verify the methodologies used to provide those measurements.  The technical review is followed by a “multilateral assessment,” which is essentially a Q&A between the party being assessed and other parties on the basis of all submitted national reports.  To date, all developed countries have gone through one full round of IAR.

Under International Consultation and Analysis (ICA), developing country parties enhance the information in their NCs through the submission of biennial update reports (BURs), which include a national inventory report and information on their mitigation actions, needs, and support received.  Unlike developed countries, developing countries are not required to report the progress made in implementing and achieving emission reductions.  The BUR then undergoes a technical analysis by a team of technical experts under a less rigorous standard of review than for IAR, resulting in a summary report that includes the capacity-building needs to facilitate reporting in subsequent BURs.  The technical analysis is followed by a “facilitative sharing of views,” which is another peer review forum where parties are free to ask questions of a party on its BUR.

Although the current ICA process for developing countries is only halfway through its first round, both the UNFCCC secretariat and parties have learned some important lessons.  There has been significant improvement of the technical basis for reporting, such as greater consistency in the use of reporting methodologies and an increase in the requests for technical review of NCs.  There is more coherency and coordination at the institutional level, domestically and internationally, although room for improvement remains.  Finally, for developed and developing countries alike, simply going through the process and engaging with the secretariat improved the quality of reporting and increased familiarity with the process.

Negotiating the Paris Agreement – moving beyond bifurcation

The Paris Agreement, adopted at the Conference of the Parties (COP) 21, calls for an enhanced transparency framework requiring all countries to work toward the same standards of transparency and accountability. UNFCCC, Conference of the Parties, Twenty-first Session, Paris, France, Nov. 30-Dec. 13, 2015, Decision 1/CP.21: Adoption of the Paris Agreement, U.N. Doc. FCCC/ CP/2015/10/Add.1 (Jan. 29, 2016).  The new framework will build on parties’ experiences with the existing system but without its strict bifurcation between developed and developing countries. All countries will be required to report on their GHG emissions and implementation efforts at least every two years and undergo both expert review, or technical analysis of the information in their reports, and peer review, in which parties can engage reviewed parties on their reports.  Id. at ¶¶ 90-91; Annex, art. 13(3, 4, 11).

To achieve this outcome, negotiators had to overcome a number of concerns by developing countries.  Some were worried that the in-country expert reviews currently required of developed countries would impinge on their sovereignty if imposed.  Many already lack the funding, expertise, and data to comply with existing requirements; fulfilling enhanced requirements would require further capacity building.  Finally, most voiced some fear of the unknown.  With only 16 developing countries having submitted biennial reports by December 2015, few even had experience with ICA.

The agreement assuages some of these worries by increasing the flexibility and capacity building measures under the Convention.  To enable developing countries to comply with the new requirements, the transparency framework “shall provide flexibility in the implementation of the provisions of this Article to those developing country Parties that need it in the light of their capacities.” Id. at Annex, art. 13(2).  Moreover, it establishes an enhanced framework for capacity building to support developing countries.  The Paris outcome launched the Capacity Building Initiative for Transparency, to be funded through contributions by developed countries, to help developing countries create or enhance the domestic tools and institutions they need to meet these obligations. Id. at ¶¶ 84-86.  The Paris Committee on Capacity Building was also set up to oversee a four-year work program to boost the capacity building activities needed to implement the Paris Agreement. Id. at ¶¶ 71-73.  The work program will, for instance, identify and provide recommendations on addressing capacity gaps and needs, promote the dissemination of tools and methodologies for capacity building, and explore how developing countries can take ownership of building and maintaining capacity over time.  Id. at ¶74(b),(c),(f).

The transparency processes will feed into a global stocktake, which will assess collective progress towards meeting the Paris Agreement’s long-term goals. Id. at art. 14.  They will also link to a new committee of experts to “facilitate implementation” and “promote compliance.” Id. at art. 15(1).  In contrast to the Kyoto Protocol, which included an enforcement-based compliance system, this committee will be facilitative in nature and operate in a “non-adversarial and non-punitive” manner.    Id. at art. 15(2).

Post-Paris Implementation

Further work is needed over the next few years to establish the nuts and bolts of the new transparency regime.  Parties must overcome some key challenges.  The agreement promises to accord flexibility to developing countries, but the exact nature of that flexibility and how it will be operationalized is an important consideration as parties begin to negotiate the implementing rules.  Parties will need to determine how flexibility can be built into the modalities, procedures and guidelines for transparency of action and whether existing communication channels can be streamlined to avoid overburdening developing countries.

Flexibility can be embedded in the transparency process in many ways.  For instance, some countries might initially submit their reports less frequently.  Parties currently report on their GHG inventories via guidelines that offer several approaches, or “tiers.” Each tier represents a level of methodological complexity in categorizing emissions and activity data.  Tier 1 is the most basic method while Tiers 2 and 3 are each more demanding in terms of complexity, certainty, and data requirements.   Thus, another option would be for some developing countries to start at the lowest, least stringent, reporting tier, and comply with higher tiers as they build institutional capacity over time.

Because the transparency process links to the global stocktake and will be buttressed by an implementation and compliance mechanism, parties will need to clearly outline their relationship to one another and coordinate the complementary work on these elements.  The Global Environment Facility, which serves as a financial mechanism for the UNFCCC, will also need to make the financial arrangements necessary for the operationalization of the Capacity Building Initiative for Transparency.  Id. at ¶ 86.  This is a crucial step for developing countries to make the switch to the new transparency framework, and continue to do so over time.

The new working group for the Paris Agreement will begin to develop the modalities, procedures, and guidelines for transparency of action and support as well as for the implementation and compliance mechanism.  Id. at ¶¶ 91, 103.  It will report each year to the COP before concluding its work in 2018, at which time there will also be a facilitative dialogue to assess collective efforts.  Id. at ¶¶ 20, 96.  The recommendations on transparency of action and support will be forwarded to the first Conference of the Meeting of the Parties to the Paris Agreement (CMA 1), which will take place after the Paris Agreement has entered into force.  Id. at ¶¶ 91, 99.

Conclusion

The Paris Agreement rests heavily on transparency as a means of holding countries accountable.  Over the next few years, parties will undertake the technical work necessary to build on lessons learned and transition to a new transparency system.  Creating a flexible system that increases parties’ capacities over time is paramount in this endeavor and will send a positive political signal to developing countries.  Because countries will work towards the same standards over time, learning by doing ought to be a guiding principle, enabling countries to build on existing experience, develop trust, and identify gaps and incentivizing them to see the value of actively participating and learning from the transparency process.  The establishment of a transparency framework that applies to all while providing flexibility for developing countries with less capacity is one of the greatest achievements of the Paris outcome.

Advancing toward an HFC phasedown

The latest round of negotiations under the Montreal Protocol concluded late Saturday night in Vienna with key elements of an amendment to phase down hydrofluorocarbons (HFCs) beginning to take shape. The progress in Vienna sets the stage for a final agreement at the Meeting of the Parties scheduled for October in Kigali, Rwanda.

Countries are now closer than ever to a historic breakthrough that can dramatically reduce the risks of global climate change.

Because they are potent greenhouse gases rapidly expanding in their use in refrigeration and air conditioning, HFCs are a critical target in international efforts to achieve the goal established under the landmark Paris Agreement of keeping temperature increases well below 2 degrees Celsius. An ambitious HFC amendment could reduce global temperatures by an estimated 0.5 degrees by 2100 compared to business as usual growth. 

The highlight of the meeting was a call to action delivered by U.S. Secretary of State John Kerry. His appearance, along with several days of morning to late-night engagement by Environmental Protection Agency Administrator Gina McCarthy, underscored the critical importance the United States places on using the HFC amendment to build on the momentum achieved in Paris. 

Two key issues were the focus of the negotiations in Vienna: the baseline (the level of HFCs from which controls are based) and timetable for limiting HFC emissions, and the guidelines for providing financial support for developing countries in meeting these obligations. While more work remains to be done before the October meeting, real progress was made on both fronts.  

The proposal for developed countries centered around setting a baseline of 2011-2013 with a 10 percent reduction from there by 2019. Most of these countries have already begun limiting HFCs though domestic regulations.

For developing countries, where HFC use is only now ramping up, a wide range of proposals was put forward. A large number of countries (African Group, Pacific Island countries, a number of Latin America countries, the United States, Japan, Canada, Australia, New Zealand, and the European Union) supported a baseline of 2017-2019 with a freeze at 2021. India, China and Gulf Cooperation Countries offered less ambitious proposals. India’s proposal would allow the longest unrestricted use with a baseline of 2028-2030 and a freeze at 2031.

On funding issues, there was broad agreement on using the Protocol’s Multilateral Fund as the institution for administering financial support to developing countries. Secretary Kerry emphasized that over 75 percent of the fund’s donor base of developed countries has already publicly stated their intention to provide additional funding to implement an HFC amendment. The key points of contention relate to important details concerning what aspects of costs will be paid and over what period of years.

Despite the progress made last week, closing the deal on an HFC amendment in October will not be easy and is by no means assured. With continued U.S. leadership and a willingness among all nations to cooperate in confronting the clear and present danger of climate change, an HFC amendment in 2016 should be achievable.

A bright future for the International Solar Alliance

Rooftop solar panels in central India.

Photo courtesy Coshipi via Flickr

A bold initiative to vastly expand solar energy in developing countries recently reached two major milestones toward its ultimate goal of mobilizing $1 trillion in solar investments by 2030.

In late June, the World Bank Group signed an agreement establishing it as a financial partner of the International Solar Alliance, providing more than $1 billion in support. The Bank Group will develop a roadmap and work with other multilateral development banks and financial institutions to mobilize financing for development and deployment of affordable solar energy.

The news follows the June 7 joint announcement between India and the United States to launch an initiative through the Alliance focusing on off-grid solar energy.

The International Solar Alliance was announced at the Paris climate conference in December by Indian Prime Minister Narendra Modi and French President François Hollande. It was one of many new initiatives involving business, civil society, and public-private partnerships launched in Paris.

The alliance will comprise 121 countries located between the Tropic of Capricorn and the Tropic of Cancer that typically have 300 or more days of sunshine a year. Companies involved in the project include Areva, HSBC France and Tata Steel. 

According to the Renewable Energy Policy Network for the 21st Century (REN21), global solar capacity experienced record growth in 2015, with the annual market for new capacity up 25 percent over 2014. More than 50 gigawatts were added, bringing the total global capacity to about 227 gigawatts. That’s about 10 percent of the total amount of electricity the U.S. produced in 2015.

In developing and emerging economies, affordable financing is a challenge. The alliance will work to expand solar power primarily in countries that are resource-rich but energy-poor by mobilizing public finance from richer states to deliver universal energy access. Strategies include lowering financing costs, developing common standards, encouraging knowledge sharing and facilitating R&D collaborations.

President Hollande laid the foundation stone of the International Solar Alliance at the National Institute of Solar Energy in Gurgaon, Haryana in January, marking the first time India has hosted the headquarters of an international agency. The Indian government is investing an initial $30 million to set up the headquarters. The French Development Agency has earmarked over 300 million euros for the next five years to finance the alliance’s first batch of projects.

The solar alliance complements India’s own ambitious solar energy goals, which include a 2030 target of 40 percent of electric power capacity from non-fossil fuel energy sources as part of its intended nationally determined contribution to the Paris Agreement. India also plans to develop 100GW of solar power by 2022, a 30-fold increase in installed capacity. 

The growing support for the solar alliance is evidence of rising political momentum around the world to act on climate change and transition to a low-carbon economy. Look for a third major milestone in September, when the Alliance meets for its inaugural Founding Conference in Delhi.

The Montreal Protocol

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Negotiations are under way to amend the Montreal Protocol, considered the most successful international environmental treaty, to phase down hydrofluorocarbons (HFCs), a fast-growing source of potent greenhouse gases contributing to climate change.
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