unfccc cop14: components of a post-2012 climate deal
DESCRIPTION
Rob Bradley and Jonathan Pershing explore finance and the global climate agreement. Poznan, Poland (December 5, 2008)TRANSCRIPT
Components of a post-2012 climate deal
Finance and the global climate agreement
Rob BradleyJonathan Pershing
World Resources Institute
• Where does finance come from?• Where is it needed?
– Adaptation– Technology – Forests– Developing country mitigation– Trade and sectoral approaches
• What next?
UNFCCCFunds
Other multilateral
e.g. World Bank CTF
Other government
al
e.g. ODA increase, bilateral
R&D
Non- government
al
e.g. NGOs, universities
Private sector
investment flows
Source: IPS
UNFCCC Low Estimate
2006 Level
If developed countries met 0.7% GNP target)
UNFCCC High Estimate
0
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
Fundingrequired
TechnologyFunds‡
CDM in 2006 CDM potentialin 2030
GlobalInvestment inSustainable
Energy*
Total ODA FDI intodevelopingeconomies
Mill
ion
US$
Potential Future Funding - highestimate
Potential Future Funding
Actual Funding Available
‡ ‡ Indicative total * Total deals in 2006, including venture capital, private equity, corporate R&D, public R&D, asset and project finance and mergers and acquisitions (Source: New Energy Finance)Source: WRI, with data from New Energy Finance, UNCTAD Statistics, UNFCCC, and The World Bank
Adaptation
• Perhaps strongest prospects for public finance
• Tricky area for private finance• Adaptation Fund will likely
not handle all relevant finance
• …but can have an important steering role
Deploying adaptation finance
Adaptation
WRI Expert:
Heather McGray
Key Publication
Weathering the Storm: Options for Framing Adaptation and Development
Financing Adaptation: Opportunities for Innovation and Experimentation
Cumulative Energy InvestmentSource: IEA, WEO, 2006
Technology finance
Scale of current/necessary deployment
Source: Stern Review
Technology financeWRI Expert:
Britt Childs Staley, Hilary McMahon, Jenna Goodward, Dennis Tirpak, Deborah Seligsohn, Tan Xiaomei, Weng Weili
Coming up
Juice from Concentrate: investing in solar thermal electricity
Case studies of technology deployment in China
New
Five components of a new financial deal on technology under the Convention
From positions to agreement: technology and finance under the UNFCCC
Forests
Lots of options in the Bali Action Plan
• Carbon markets may not be the panacea some hope
• Policies and measures need to be implemented and supported in a variety of ways
• Developed country actions will count too – get more added value to more sustainable forest practices
Policy Options•Accuracy, Availability and Transparency
•Curb over-capacity
•Ensure legal supply
•Monitoring
•Planning and incentives
•Law enforcement
•Social forestry
•Fire prevention
•Certification
YEAR
Total Total
1985 23.5 14.6
1989 40.4 24.4
1990 37.9 25.3
1997 47.4 29.5
1998 45.3 19
1999 44.9 20.6
2000 47.8 13.8
2001 49.1 10.1
2002 50.5 8.1
LOG CONSUMPTION (including timber and pulp)
OFFICIAL LOG PRODUCTION (including
timber and pulp)
Comparison of Log Production and Consumption
Source: World Bank 2006
Accurate timely maps
Forest Management Units
Forests
WRI Experts:
Florence Daviet, Fred Stolle, Susan Minnemeyer, Lars Laestdius, Crystal Davis, Smita Nakhooda
Key Publication
REDD Flags
Beyond Carbon Financing
Sustainable supply chain procurement guide
Upcoming: Governance Forest Indicators
Trade and sectoral approaches
• Concerns over competition
and trade• Unilateral measures being
taken by developed countries won’t necessarily succeed
• But they may disrupt the multilateral process
• Sectoral approaches that address competitiveness concerns have been ruled out in UNFCCC
WRI Experts:
Robert Heilmeyer, Jake Werksman, Taryn Franzen
Key Publication
Leveling the Carbon Playing Field: International Competition and US Climate Policy Design
Developing country mitigation
Measurable, reportable and verifiable actions and support
• Bali offers a more common and more differentiated approach
• Greater variety means greater complexity
• Actions more rooted in national policies and plans are more likely to be implemented
• Financial support is likely to vary among countries and actions
WRI Expert:
Hilary McMahon, Taryn Fransen, Smita Nakhooda
Coming soon
Measuring the way to a new climate agreement
New paper with Tsinghua University on MRV in China
Financing a climate response is possible, but there is no easy solution
• Policy design can help enhance political support for finance
• Carbon markets are important, but not magical
• Finance is likely to flow through a variety of mechanisms
But how will real life intervene?
Implications
A new wrinkle: market behavior
Shanghai Index FTSE 100 Index S&P 500 Index
Nikkei 225 Index BOVESPA Index
Source: http://www.bloomberg.com, 9 October 2008
National Stimulus Packages
Source: USEPA: April 2007, US GHG Inventory
Country Amount Package Description
Australia $6.7 billion Pensioners, low and middle income earners; home purchase assistance
Britain £20 billion cut sales tax, help for small businesses, low earners and households
China $586 billion welfare housing, infrastructure, social & environmental services, economic restructuring, natural disaster relief, etc
Germany $29 billion tax holiday for new cars, subsidies for enhancing energy efficiency of buildings, new infrastructure investments
Italy $101 billion Environment R&D, public/private partnerships in infrastructure investment, tax measures for companies, funds to households
Japan $277 billion direct cash to households, loans for small businesses, reduction of highway tolls, subsidies to farmers
Mexico $22.8 billion
Infrastructure projects, new oil refinery, support small- and medium-sized businesses
S.Korea $10.8 billion
tax cuts, infrastructure & other projects, support to SMEs & low-income households,
US $100.3 billion -
unemployment, auto industry support, housing, small businesses, energy independence, infrastructure, disaster assistance