Transcript Document

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CDM & Next Steps for Montreal
and Beyond
Farhana Yamin
Institute of Development Studies, UK
Project Director, BASIC: Building And Strengthening
Institutional Capacity on Climate Change in Brazil,
South Africa, India, China
South Africa National Climate Change Conference
2005
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Presentation Overview
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Clean Development Mechanism
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Strengths, weaknesses & improvements
Why “next steps” discussions at Montreal are a
crucial leadership test for developing countries
Issues/options for a Montreal mandate for DCs
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institutional home, scope, duration, due process and
resource implications
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Clean Development Mechanism
• “Win-win” carbon market mechanism for developing countries
• Allows richer countries & investors to provide resources for cleaner
projects in return for credits (certified emissions reductions (CERs)
that count towards compliance with Kyoto targets
• A share of the proceeds of CERs (2%) goes to vulnerable DCs to help
them cope with adaptation to climate impacts
• CDM - a unique feature of Kyoto
– only thing in Kyoto of direct benefit to DCs
– only thing in Kyoto championed by DC (apart from targets)!
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CDM Strengths
• Voluntary
• DCs define what counts as
sustainable development
climate friendly projects
• Enables wide range of actors
to become involved in climate
policy!
Weaknesses
• US withdrawal means smaller
carbon markets & uncertainty
post 2012
• Bigger “teething problems” -US
withholds funding for CDM
institutions
• Entry to carbon markets
• Huge & unique governance
challenges national &
international
• Benefits for all countries –
even non-CDM participants
through CDM Adaptation Fund
• Too many expectations from
too many actors to deliver
benefits immediately!
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CDM: next phase improvements
• Existing CDM rules can be improved & operationalized
much better right now by, e.g.:
– EB proactively developing methodologies in key areas instead of
allowing these to emerge “bottom up” thru lengthy/risky project
cycle
– COP/MOP guidance to EB to develop modalities for how larger
projects, sectors & programmes can make use of CDM by 2006
– Affirmative action for DC certifiers (DOEs) approved to ensure incountry benefits, address bottle necks, support CDM sustainability
– Capacity building for all users & stakeholders in public & private
sector. e.g local authorities responsible for roads, housing, waste
and provision of energy services
– Secure long term funding for EB to function effectively!
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Montreal: Leadership challenges
for DCs
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DCs need to act proactively & strategically. Not easy due to diversity (AOSIS,
LDCs, larger DCs, OPEC) & lack of policy analysis. But are a family of nations
united by strong ties
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At Montreal DCs must work with like-minded “ a package” covering:
– Adoption of Marrakesh Accords giving effect to Kyoto
– Improvements to CDM – real danger CDM pettering out by 2007/8 unless
certainty on post 2012 CERs provided & DCs might be squeezed out of
EU ETS carbon markets by “hot air” “paper” allowances
– Adoption of outcomes on “next steps” discussions under FCCC & Kyoto to
ensure we don’t we don’t return to “voluntary” approaches that don’t work
for richer countries
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Montreal: Leadership challenges
for DC
• International inaction shifts risks of climate change to poor
and DCs…DCs need an effective international climate
regime
• Historically DCs played key leadership role
– 1994/5 “Green Group” DC/EU alliance secured Berlin Mandate on
terms favourable to DCs
– 1997-2001 DCs key players in Marrakesh Accords after US
withdrawal
– 2001 -2004 DCs have ratified Kyoto notwithstanding US inaction
• 2005 clear political choice for DCs at Montreal on next
steps:
– do nothing/prevaricate & increase vulnerabilities of poor & DCs
– be proactive & reduce climate burdens & related poverty
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Mapping out a Next Steps Mandate
1. Institutional home (s)
– FCCC? KP? Big Emitters clubs?
2. Scope
(a) Whose actions: AIPs? DCs? Big emitters? Companies? Sectors?
(b) Subject matter: GHG reductions only? Adaptation? Technology?
Livelihoods & well-being? Energy security?
(c) Accountability: Binding? Soft? Who monitors compliance?
3. Duration: start/end date
4. Due process/resources issues
(a) Effective participation of DCs & their stakeholders in negotiations
(b) Resources to secure attendance & policy analysis of key future
choices
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Institutional home…FCCC
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FCCC advantages
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189 Parties including US
Clear legal authority & established institutions over issues that
matter to DCs
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financial mechanism (GEF)
technology (EGTT)
implementation/national communications (CGE)
adaptation (LDC/LEG)
Fewer expectations of post-2012 architecture
FCCC disadvantages
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If US uninterested, as Party has more leverage to block progress
COP too unwieldy – smaller/parochial interests can capture
agenda
Gravitates towards one-size fits all & least common denominator
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Institutional home…Kyoto
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Kyoto advantages
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next steps negotiations mandatory for all Parties
By 2005 for second commitment period for AIPs (Article 3.9)
In 2006 for review of whole Protocol (Article 9.2)
Familiar framework - warts and all
Established institutions (CDM/EB, A6SC & Compliance) & relatively
coherent, but readily adjustable, roadmap for post-2012 (e.g. diversity of
no-lose targets, more sectors, better LULUCF solutions)
Kyoto disadvantages
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US not a Party, no pressure for it to re-engage
Possible pressure on DCs to adopt same type of commitments as
Annex I Parties rather than trying out tailor made solutions to fit DC
circumstances
FCCC remains core legal/institutional focus for core DC concerns
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Institutional home…big emitters
fora
• No real clarity on how this would work but key
initiatives/institutions suggested:
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G8, G8+Plus 5? +World Bank/IEA?
Asia-Pacific Partnership for Clean Development?
Carbon Sequestration Forum?
Partnership for Hydrogen Economy?
Methane to Markets?
Around 15 other US bilaterals with major emitters since
2001? EU bilaterals? Japan-Brazil? Others?
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Institutional home…big emitters
fora
• Advantages
– 25 countries account for 83% global GHG emission with just 7
accounting for 75% global GHG emissions (EU, US, Canada,
Russia, Japan, China & India)
– Dynamics among small group of political giants might make for
better outcomes or at least a route out of impasse
• Disadvantages
– No established institutional fora for negotiations, no transparency,
no long term accountability mechanisms for 100yr+global problem
– Wide disparities: per capita emissions, development challenges,
energy mix & global political aspirations -can’t agree in G8!
– Is multilateralism a flawed route to solve global problems?
– For vulnerable DCs, is leaving the foxes in charge of the hens a
safe strategy?
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Montreal Mandate: Two steps and
a leap?
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COP-11
– should agree a 2 day in-session workshop to be held at SBI-24 inviting
FCCC Parties to submit views on next steps & how information from the
reviews processes under FCCC & Kyoto due in 2006-2007 should inform
implementation/next steps processes under both instruments (see
FCCC/SBI/2005/16)
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COP/MOP-1
– should agree that Kyoto Parties submit views to SB1-24 in-session
workshop on next steps specifically addressing timing, scope and other
issues relating to AIP’s second commitment period (SCP) commitments
with a view to COP/MOP-2 adopting a negotiating mandate that
coordinates SCP negotiations with launch of Kyoto Art.9 review in 2006 &
any reviews agreed under FCCC by COP-12
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Role of Big emitters fora
– If agreement reached can be complementary & feed into on-going COP
and COP/MOP negotiations
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Mapping out Next Steps…Scope &
Timing
• Elaborate following by COP-12/COP-MOP2
– Whose actions: AIPs? DCs? Big emitters? Companies? Sectors?
– Subject matter: GHG reductions? Adaptation? Technology?
Response measures? Livelihoods & well-being?
– Accountability: Binding? Soft? Who monitors compliance?
• End date of negotiations: 2009 latest
– Must ensure smooth transition from end of Kyoto first commitment
period (2012) and modalities to incorporate US in next phase e.g.
thru linking with emerging US carbon markets and GHG reduction
programmes
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Mapping out Next Steps…Effective
DC participation &
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DCs often have less input to international negotiations
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due to lack of capacity to prepare positions & underlying policy
analysis. e.g. failure to construct carbon markets on DC terms
DCs must take a more proactive approach to crafting institutional
processes to suit their interests & capacities
Resources for DC policy analysis & attendance for
meetings must be put on secure footing before serious
next steps negotiations begin
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All FCCC/KP budgets (e.g. 2006-7) must secure resources to
support DC attendance, capacity building & policy analysis
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Further information & BASIC
Papers & Presentations
BASIC Website: www.basic-project.net
SA BASIC Team Coordinator: Mike Palmer/Julie Middleton
Palmer Development Group www.pdg.co.za
Imbewu-Enviro Legal Consultants
SouthSouthNorth
Harald Winkler (ERC)
Institute of Development Studies, Sussex, UK,
www.ids.ac.uk
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