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Part 2: When Your Negotiator Says ‘Why do We Need Loss & Damage Finance’? Who You Gonna Call? ‘ECO!’’

Yesterday ECO answered some developed countries’ questions on why a new finance facility on loss & damage (L&D) was needed, how L&D should be defined, and why new and additional finance is needed to address L&D. Countries loved it so much that they asked ECO a few more questions. So, by popular demand, ECO is back for another round!

Why should there be additional finance?

Vulnerable and frontline communities in developing countries have been inundated with extreme heat waves, rampant forest fires, devastating droughts, catastrophic floods, increasingly destructive hurricanes, typhoons and cyclones, and sea level rise. These climate-drive loss and damage impacts are stealing people’s lives and livelihood, and they go beyond what people and ecosystems can adapt to. Impacted communities cannot be expected to address climate change on their own, especially not without resources, support, and implementation structures in place.

Developed country rebuttal: Why should we split L&D finance from adaptation finance?

ECO says: For many countries, it is necessary that there be both financing to adapt to climate impacts and to address losses and damages resulting from climate impacts that cannot be adapted to. Most financing for adaptation is not able to support the needs of developing countries to address loss and damage. Finance is needed to address slow onset climate impacts (sea-level rise, glacial melt, forest degradation) as well as fast onset impacts (typhoons, landslides, wildfires) and adaptation finance does not adequately cover all of these needs. 

Developed country rebuttal: Why can’t we just commit to providing more finance for adaptation?

ECO says: Loss and damage is the consequence of moving beyond the ability of people and ecosystems to adapt to the scale and pace of changing climates. Although adaptation financing is a priority and needs to be rapidly scaled up, for many people, the reality is that it is too late to adapt.

Developed country rebuttal: Why does the WIM need to take a human rights and gender-responsive approach?

ECO says: Women, children, Indigenous communities, and members of the transgender community are often more impacted by loss and damage than men, especially when it comes to access to health care, food, and water. For example, after a drought, members of these communities are more likely to face water insecurity longer than men. Such discrimination makes these communities more vulnerable to being taken advantage of and, additionally, increases the likelihood of further exposure to climate risks after a shock.  

Developed country rebuttal: Why does the WIM only prioritise vulnerable communities in developing countries? 

ECO says: The mandate of the Warsaw International Mechanism on Loss & Damage (WIM) is to support developing countries. Many of whom are the least responsible for climate change. ECO finds it absurd that some countries would ask for the divide between countries to be re-examined. ECO recognises that there are marginalised peoples and communities around the world. However, developed country Parties are often in a better position to address climate change and have more resources and options, compared to developing countries. 

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The Erosion of Ice and Identity in the Arctic

We all know the reason for our annual COP convergence: avoiding catastrophic climate change. The IPCC told the world that we have the next 10 years to close the emissions gap, but the message from National Inuit Youth Council President, Crystal Martin-Lapenskie, is “Inuit living in the Arctic don’t have 10 years. We are experiencing catastrophic climate change right now.” Inuit knowledge was echoed in the findings of the IPCC Report on Oceans and Cryosphere in a Changing Climate (SROCC) released in September and shared yesterday on the floor at COP25. The report is an example of Indigenous knowledge and Western science saying the same thing: the cryosphere is changing, rapidly and profoundly. Warming oceans and air mean reduced ice coverage, rising sea levels, flooding in low lying areas, and the erosion of our shorelines resulting in relocations of infrastructure and people. For Inuit living in the Arctic, ice and glacial loss is not just a matter of physical changes in the environment, but a threat to Indigenous lives and livelihoods.

Inuit from throughout Chukotka, Alaska, Canada, and Greenland as well as others have been bringing this message of urgency to the COP for decades. Benjamin Qetun’aq Charles, Inuit Yup’ik, Inuit Nunaat (homelands), talks about how Indigenous knowledge systems are evolving due in part to exponentially changing ecosystems. He says, “Water bodies; rivers, lakes and ponds and the ocean ecosystems temperatures have increased. Our fishermen have been forced to harvest outside of legally regulated fishing times. Hunter-gatherers have to travel much longer distances to find food sources including walrus, seal, and whale, which are adapting to changing macro, micro and/or amalgamating ecosystems, for example, ice for seals and walrus haul-outs. This changes the dynamics for hunters and gatherers who are traveling longer distances at greater monetary expense.”

Air temperatures within the Arctic are increasing at a rate of at least two times the global average. This makes the 1.5°C target stipulated in the Paris Agreement redundant for those who are already being displaced both physically and culturally. The Pikialasorsuaq Commission initiated by the Inuit Circumpolar Council (ICC) recommended Inuit-led management in response to cryosphere change in the North Water Polynya. In the past, Inuit would cross between Canada and Greenland along an ice bridge; however, this practice now depends heavily upon uncertain ice and sea-ice conditions. The commission have supported the continuation of this crossing by establishing direct Inuit control over the region and visa-free travel for all Inuit users between Canada and Greenland. 

While Indigenous Peoples work against rising tides, to uphold the traditional livelihoods of Inuit, they continue to be undermined by the lack of ambition shown by state governments. Current projections show that states are a long way off of staying under 1.5°C of warming. Inuit are in the midst of climate relocation and unprecedented adaptation.  More ambitious targets, and urgent action to reach them, are needed now. The Arctic can no longer be thought of as the “dress rehearsal” for the rest of the world. The basic human rights and traditional ways of Inuit are at stake right now, and ambitious NDC’s are needed which reflect the value of their lives and livelihoods too.

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Voices from the Front Lines: Loss and Damage: the Price of Carbon in the Philippines!

On 2 December, category 4 typhoon Kammuri made landfall in the Bicol region of the Philippines. Several hours prior, Paula Guevara, a resident in the region, recalls a literal calm before the storm. Then she heard a whistling sound she had only previously heard during typhoon Haiyan in 2013. Her household then lost power. And then came the strong winds and heavy rainfall that lasted through the night.

After a stormy night, her house remained standing, except for the avocado tree in front of her house. This tree had survived previous super-typhoons, but its luck ran out with the fury of Kammuri.

The tree is a literal embodiment of loss and damage that vulnerable communities are facing in the climate emergency. If drastic greenhouse gas emissions cuts do not happen immediately, adaptation and resilience-building measures will not be enough to address climate change impacts in the future.

While Paula’s family was fortunately unscathed, others were not so lucky. As of writing this, 13 people lost their lives, nearly 400 thousand Filipinos were displaced, and more than PHP800 million (US$16 million) of agricultural assets were damaged by Kammuri. 

We refuse to accept that we keep paying the price of carbon. Polluters must pay with their ill-gotten wealth, not innocent people with their lives. We demand for climate finance to not just support mitigation and adaptation measures or address loss and damage, but also proactively avoid and minimise the latter. We deserve better.   

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Australia Needs to Start its NDC at the Starting Line, Not Half-way Through the Race

Imagine if in the Olympics you could get away with starting the race half way down the track. That is what Australia plans to do with its NDC — to carryover a controversial “overachievement” from its modest Kyoto Protocol commitments to extinguish half the effort required to meet its very deficient 2030 target. Australia has admitted it has 367 million tonnes of units. Though you won’t see this mentioned in Australia’s NDC, and ECO wonders if it ever will be, given Australia’s reluctance to update its climate efforts next year. 

With bushfires burning across Australia, rising national emissions, rising coal and gas exports (recall Australia is the third largest exporter of fossil fuels), and failed climate policies — now is the time for Australia’s new Ambassador for the Environment to step up and do the right thing. Cancel these credits that even your Kiwi neighbours admit are not in the spirit of the Paris Agreement. And if any countries have text up their sleeve to stop the use of carryover units from Kyoto, ECO hopes they table it at COP25. 

EU, is this one for you? Leadership extends to ensuring the integrity of the Agreement, in addition to increasing domestic ambition. Here’s an opportunity for true leadership.

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The Conversation Continues… OMGE! Convincing a Skeptic on “Automatic Cancellation”

Welcome back! ECO’s conversation with an OMGE automatic cancellation skeptic was just too [lengthy][complex][exciting] for one day. Mandatory partial cancellation ensures that Article 6 goes beyond zero-sum offsetting (a principle and requirement under Article 6.4 of the Paris Agreement. Mandatory partial cancellation is a process where buyers (like a country or an airline for compliance under the ICAO CORSIA) buy some mitigation outcomes and a certain percentage of that purchase has to be set aside for the benefit of the atmosphere. What’s left would be used by the buyer to help achieve the target.

So here we go… 

ECO: Hi there OMGE automatic cancellation skeptic. How did that discussion on baselines and additionality go? Let’s continue discussing OMGE automatic cancellation. Shall we?

OMGE automatic cancellation skeptic: Yes, I would love to continue our discussion. Im starting to understand your perspective. But, with this automatic cancellation thing:  it just complicates things.

ECO: It is actually very straightforward. We have already been setting credits aside under the CDM for share of proceeds. The logic is comparable. So, we have the necessary experience on how to set this up. In Katowice, countries were in a position to agree on voluntary cancellation for Article 6.4, so this isn’t something new.

OMGE automatic cancellation skeptic: I understand. But we dont know enough about how this would affect supply and demand for ITMOs, so setting any rate is very dangerous. Why do you want to kill the market?!

ECO: We know enough. Demand is very likely to be fairly inelastic for a while — meaning, countries and ICAO CORSIA-complying airlines that are the likely buyers of credits are going to need them anyway in the short term to hit their climate targets. And if they don’t need them, they really shouldn’t be using carbon markets to hit these targets. They should be using them to OVERACHIEVE their NDCs.

OMGE automatic cancellation skeptic: Ok, fine… I’m starting to realize that this mandatory cancellation thing is a pretty good idea. Maybe I would be okay with OMGE through mandatory cancellation in the Article 6.4 mechanism; but please, please don’t affect those precious emissions trading systems and bilateral mechanisms which would fall under Article 6.2. OMGE is not called for in 6.2.

ECO: I’m glad you’re starting to understand that mandatory OMGE under Article 6.4 is the most logical approach. You’re really starting to take a more…cooperative approach [Hahaha…awkward pause]. Let’s at least agree on the need to apply this to Article 6.4, and then consider the other opportunities for applying it to Article 6.2. 

OMGE automatic cancellation skeptic: … Alright, I agree with you. Let’s go with a 50% OMGE automatic cancellation rate. And let’s start looking at how to apply it to Article 6.2 as best we can. 

[After reaching this agreement, OMGE automatic cancellation skeptic and ECO high five! Then over tapas and wine talk about how to phase out the Kyoto mechanisms, ensure there is no double counting, and ensure the protection of human rights through social and environmental safeguards, an independent grievance mechanism, and consultations with potentially affected communities. They solve all Article 6 issues overnight and realize that OMGE was actually a key issue to unblock things and not just a “nice to have.”]

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Multilateral Assessment – We’ve Got Questions for You

ECO is excited to see so many Annex I Parties participating in the multilateral assessment of their biennial reports. ECO congratulates Parties for participating and thinks the multilateral assessment can be a great place to share experiences and lessons learned with other Parties in a constructive environment. We look forward to hearing your presentations and answers during the Q&A sessions. 

Since ECO can’t ask questions during these workshops, we figured we’d ask them here:

  • To all Parties

    • Can you provide an update about actions taken to strengthen policy-making processes – in particular in relation to public access to information and public participation – so as to improve climate responses and promote policy coherence in the context of progress made towards meeting your commitments under the UNFCCC?

  • Belgium

    • Like all other countries, Belgium should finalize its Long Term Strategy by the end of next year. Could you explain what the current status of the strategy is, keeping in mind that four governments (and other stakeholders) need to contribute to it?

    • To what extent do the policy measures proposed in your draft and (now almost final) National Energy and Climate Plan correspond to the goal to reduce emissions by 35% in 2030? Does the plan include specific data on the climate effects of the different proposed measures and a detailed overview of investments needs? Do you care to share?

  • Bulgaria

    • Bulgaria is still not a member of the Just transition platform of the EU and has no plans for a coal phase out. Is Bulgaria planning to remain a coal-dependent country? What are the plans for an energy transition in Bulgaria? 

    • In the draft version of its NECP, the Bulgarian Environmental ministry proposed an increase of CO2 emissions to 2030. Is this still a position of Bulgaria and how does this target align with the EU and UN climate targets, and the SDG goals?

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The Just and Equitable Transition: Where is my Home?

Meeting the 1.5°C target means all Parties must transition away from dirty fossil fuels to clean and renewable energy as fast as possible, in line with the IPCC science and deadlines. This shift from dirty to clean power isn’t the whole story though: the necessary energy transition must also be centered in justice and equity, where the rights of Indigenous peoples, people with disabilities, workers and unions, youth, women and gender constituents, local communities, and other structurally oppressed groups, are protected and strengthened in a new inclusive and resilient energy economy. 

The reason is simple. We can’t afford to keep power, both literally and figuratively, centralized – perpetuating systems of exploitation upon which our current fossil fuel economy is built. We need to make sure that government actions factor in and respect the human, social, economic, and environmental rights at stake. 

The problem is that the topic of just and equitable transition hasn’t been afforded a natural home in the negotiations. Yes, it appears under Response Measures, and the Forum looks like it is close to adopting a 6-year work plan to help foster capacity-building and exchange of best practices between Parties. However, just and equitable transition is still not central to ambition goals, NDCs, finance and other commitments. This needs to change. Basic principles of equity and justice cannot be divorced from all the other momentous actions that need to happen to battle the climate crisis.

ECO urges all Parties to meaningfully integrate these principles of equity and justice into all their commitments in meaningful and inclusive manners. Because the people and the planet are at stake.

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Today’s winners of Fossil of the Day? Guess who!

Who else but the United States (US) and Russia! 

 

The US and Russia

Looks like the US and Russia share more than the ability to bully other countries, rig elections, and lead in climate-wrecking oil and gas production! They want to make loss and damage weak again

The US gets the fossil for opposing that money reach vulnerable communities through the Warsaw International Mechanism (WIM) for Loss and Damage, to deal with climate change impacts, which Uncle Sam has helped cause by being a massive polluter.

Russia gets to share the fossil award with the US for having the chutzpah to try and throw out human rights and gender from the loss and damage negotiations.

The US folks seem to have a very short memory. They’re forgetting that waaaay back in 2013, countries agreed to “enhance action and support, including finance” for loss and damage via the WIM. 

And Russia, come on! A record of human rights abuses both at home and blatantly at the international level? This is an overdose of bad vodka! You cannot revoke people’s right to life, to a home, and to education, with a stroke of a pen.

Hey Russia, if you don’t understand how gender, human rights, and climate are related, maybe you shouldn’t be part of this conversation?

All these basic human rights are at risk when the impacts of climate go beyond what it is possible to adapt to. If Russia paid more attention, it would know that women and children are amongst the most affected after a disaster. 

A special mention goes to Japan and Australia. You are also showing extreme hard-heartedness towards vulnerable developing countries who desperately need your support. Support – aka finance that was agreed to six years ago. Don’t find ridiculous reasons not to provide it now by focusing on insurance (insurance is not relevant for poor people - and why are we making the people on the frontline of climate impacts pay insurance premiums to cover climate damage they had no role in causing?)

A few countries gave us some hope in these negotiations. We are giving Canada, Colombia, Vanuatu, Mexico, New Zealand, Australia, Norway, and Switzerland the Ray of the Day for insisting on human rights in provisions of Article 6 regulating global carbon markets. There is no ambitious climate action without justice as well as respect for gender and human rights.  All these countries need to keep pushing for the inclusion of human rights and gender considerations until rules (that include these considerations) are adopted in Madrid.

All countries who are signatories to the UN Declaration on the Rights of Indigenous Peoples, are legally obliged to do more. They must push for the inclusion of Indigenous Rights in the text, and vocally recognize and demonstrate respect for Indigenous Rights and their right to sovereignty in their home countries. 

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Climate Finance Reporting QUIZ

Think you know all about climate finance? Think you understand whats at stake in new rules for reporting?  Take ECOs TRUE or FALSE quiz to find out…

Close to 60% of all climate finance in 2017 was in the form of loans -> TRUE

And not only that, loans which amounted to US$39.9 billion in 2017, were mostly counted at full face value, ignoring interest and repayments. New common reporting tables in the Common Tabular Format  (CTF) must mark a break from this practice of over-reporting by including a column for the grant equivalent of climate finance alongside its face value.

Only genuine climate action is reported as climate finance -> FALSE

Current rules allow for gross over-estimation of the climate relevance of funds, especially where climate change is one part of a broader project with multiple objectives. At the worst end of the spectrum, some countries (including Japan, Iceland and Greece) are counting the climate component of these projects at 100% of the project budget. New CTF tables must guard against this by including a climate specific” column, a full project value” column, and a requirement that parties set out their methodology for calculating these separate amounts.

All parties agree the Common Tabular Format should be common -> FALSE

ECO is scratching its head as to why some are proposing parties be allowed to delete columns and amend tables to suit their own reporting preferences. ECO disagrees this should be allowed — the clue is in the name, Common Tabular Format. 

Lending at a profit can currently be reported as climate finance -> TRUE

For real. A third of all bilateral climate finance loans were non-concessional, as were 70% of multilateral climate finance loans in 2016-17. There is currently nothing to stop market rate loans and no requirement to report the terms of loans provided. 

Public finance can be used to support private profit in the name of climate finance  -> TRUE
 

Private investments in what will be or already are profitable sectors such as renewable energy or water management may be portrayed as mobilised supportin the CTF. At COP24, in Katowice, it was agreed that developed countries would identify a clear causal link between a public intervention and mobilized private finance”, but are we going to be able to verify that project by project on the basis of numbers in an Excel sheet?

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Natural ecosystems: a Real Solution to the Climate Crisis

The huge forest fires raging across many countries send a clear signal — we need to keep our natural ecosystems intact or risk losing the fight against the climate emergency. Indeed, the IPCC 1.5 report was unequivocal: we cannot keep global warming below 1.5°C without tackling the crisis facing nature. ECO notes the buzzword “nature-based solutions” is flying around, looking to collect sweet nectar from fruitful coffers, and pollinating colourful blossoms galore. But we also note that the term “nature-based solutions” lacks clear definitions or criteria and can include activities that do nothing to advance real climate solutions. This has prompted ECO to take the opportunity to use specific language on the role ecosystems play in addressing the climate crisis, and how they can be protected and restored to achieve emissions reductions, enhanced resilience, and biodiversity protection:

  1. The role of ecosystems in climate ambition is not an excuse for greenwashing or continued BAU — we must keep fossil fuels in the ground at all costs.

  2. We need to prioritise the protection and restoration of our natural ecosystems, including primary forests and other intact ecosystems and those still rich in carbon and biodiversity. They are irreplaceable for stable carbon storage and for biodiversity, and we simply cannot afford their continued loss or degradation.

  3. When it comes to trees, we need to be thinking about the “right tree in the right place”, in other words, native species. But it’s more than trees and forests. Other ecosystems are vitally important too: peatlands, wetlands, grasslands, mangroves, and marine ecosystems.

Ecosystem protection and restoration will yield even more benefits for our planet and society if implemented in close partnership with the guardians of these ecosystems: Indigenous People and local communities. Securing community and indigenous land rights is key to the sustainable management of many ecosystems. 

Urgent action is needed: without protecting and restoring natural ecosystems and improving land management we will not be able to limit global warming to 1.5°C. These actions would enhance our resilience to increasing climate impacts, reduce the risks of floods and fires, and help stop the catastrophic loss of biodiversity. The IPCC Special Reports on 1.5°C, Land and Oceans & Cryosphere and the IPBES Global Assessment highlight the urgent need to transform our relationship with land, oceans, and our food systems, and to safeguard our natural ecosystems.                

We call on parties to raise ambition with clear commitments to ensure that natural ecosystems are part of the solution to the climate crisis. The first step is for parties to specify in their enhanced NDCs, by 2020, how they will reduce emissions and enhance resilience through protecting and restoring terrestrial and marine ecosystems, and to reflect these and further actions in their Long Term Strategies.

 
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