Image by Ben+Sam

In an earlier post, attention was drawn to the importance of Canada’s Boreal forests to its climate change strategy. As of May 2010, Canada signed the Canadian Boreal Forest Agreement, this was a voluntary agreement between companies (21 member FPAC) and Environmental organizations that account for two thirds of Canada’s entire Boreal forest. The agreement commits (Pew Trust has an overview here) companies FPAC (Forest Products Association of Canada) to develop and implement a framework by December 2010.

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The Executive Board of the United Nations’ Clean Development Mechanism (CDM) assumes full responsibility for its administration. Their remit is to uphold the environmental integrity of the CDM whilst ensuring the processes remains efficient and effective so projects can deliver the emission reductions.

Warning by SorbyRock

Since climate policy is a relatively immature, fast moving arena, the Executive Board (EB) needs to keep up and alter its actions accordingly. In December 2009, the UN’s climate change body provided the EB with orders to reform the CDM; guaranteeing its credibility and maximising its generation of emission reductions. Just last week, the 54^th meeting of the EB took place, but has progress been made in reforming the CDM?

EB and flow

Led by chair, Clifford Mahlung (see previous post), the recent meeting of the EB was a busy affair. Mahlung was charged with overhauling the CDM in what could be viewed as the most significant of its existence.

With the end of the Kyoto Protocol at the end of 2012, the supportive framework on which the CDM is based ceases to legally exist as we know it. The ongoing UNFCCC negotiations are quite literally paving the way to a new internationally binding agreement – including the extension of the flexible mechanisms, where the CDM fits in.

Until then however, the EB has to make do with what it has available: a project-based mechanism with the ability to potentially deliver almost one billion tonnes of carbon reductions by the end of 2012. But the CDM may be capable of more as it is currently plagued with teething problems. If it was made a simpler, cheaper and ultimately more efficient process, Mahlung could see vast improvements in the output from the CDM.

Streamlining Reform

Positively, the EB managed to adopt new procedures for project registration and issuance of Certified Emission Reductions (the currency of the CDM where one CER equates to a one tonne reduction in carbon). Essentially, these changes would help streamline regulatory processes and, in return, allow for an improvement of the timescales involved for a project to issue CERs.

One of the key measures for checking if a project meets the criteria set out by the EB is known as additionality. Essentially, for a project to be registered under the CDM, it needs to prove that it could not go ahead without the income generated from CERs.

Regardless of the physical size of a project, each has to undergo the same criteria testing. Small-scale projects, usually micro-level renewables, have usually suffered because the timings and costs involved can cripple a project. In an effort to mitigate this barrier, the EB has decided that these projects will automatically pass additionality testing, subject to certain factors: geographical (remote locations) and beneficiaries (community not connected to an electricity grid).

Secondly, with regards to the costs involved, the EB is considering a loan system to help poorer countries to adopt projects more easily. The money will originate from interest accrued on the CDM’s reserve funds, currently in the millions of dollars.

It is hoped that these changes will kick start a range of reforms which will extend the scope of the CDM to regions that are currently not able to take advantage of the CDM, such as sub-Saharan Africa (see previous post), and increase the number of registered/issuing projects.

A Warning

In a recent keynote address, the incoming head of the UNFCCC Christiana Figueres, made it clear that the EB was no longer the only blockade to CDM productivity. Instead, Figueres placed emphasis on the auditors of the CDM who are required to validate and verify the projects and emission reductions respectively.

With the EB announcing that it will carry out an additional management restructure and hire 28 people for the secretariat to deal with the CDM, the auditors may need to undertake some similar efficiency improvements if they are to take advantage of a new wave of projects.

Put simply, some progress of reforming the CDM has been made. However, it is far from over. The EB has a lot of work still to do if it is to overhaul the CDM and relive the heights of the expectations when it was first conceived.

Authors: Sabrina Chesterman & Nyla Sarwar.

As the climate talks gain pace in Bonn, progress is being made on a new text, designed to resurrect chances of a global agreement in Cancun in December. Many, including outgoing UNFCCC Executive Secretary, Yvo de Boer, are still hesitant about Cancun being able to achieve a deal, which was originally supposed to have been reached at Copenhagen last December. One of the Mexican negotiators, Luis Alfonso de Albo, has used the coverage at Bonn to try and instill confidence in what may be achieved there, stating a climate deal is still ‘positive’.

The Bonn meetings have brought together key negotiating groups, including;

(I)              AWG-KP – to focus on further commitments by Annex I parties, based on text prepared by the Chair

(II)            AWG-LCA – to focus on preparation of an outcome to be presented to at COP 16, based on a new text by the Chair

(III)           Subsidiary Body for Implementation (SBI) – which will consider issues including national communications and reporting, the financial mechanism and capacity building.

(IV)          Subsidiary Body for Scientific and Technological Advice (SBSTA) – which will consider methodological issues, technology transfer and the Nairobi Work Programme on impacts, vulnerability and adaptation to climate change.

The Bonn discussions have entered their second week with many fundamental questions still remaining regarding the legality of the proposed agreement, emission levels and temperature goals.  The big white elephant in Hotel Maritim where the discussions are being held, lingering from Copenhagen, centres on the scale of commitments by developed and developing countries. The new text aims to ameliorate the huge bridge that exist between these groups and integrate the Copenhagen Accord with the 2009 versions of the AWG-LCA and AWG-KP texts.

In regards to finance, the new text states that that all finance will be new, additional, adequate and predictable. Whilst developed countries have committed to a goal of mobilising USD$100bn/pa by 2020, there is still uncertainty about which countries will contribute towards this and how much. Discussions regarding the generation of private funds have seen suggestions of a potential international cap-and-trade system with auctioned permits. There have also been references to the creation of a Finance Board within the UNFCCC to manage the operators of the agency’s financial mechanisms (i.e the GEF and the Climate Fund), including the Copenhagen Green Climate Fund (CGCF). Disillusionment regarding funding is also created due to the texts reference to the Copenhagen Adaptation Framework (CAF), implemented through international collaboration. The CAF aims to undertake 11 activities (e.g. planning, vulnerability assessments, strengthening institutional capacities, building resilience, disaster risk reduction etc.) all of which require extensive funding.  Worryingly the text remains sparse on new market mechanisms, likely to be critical to galvanise funding, especially from private and public sector partnerships.  In addition, as the EU Commissioner for Climate Change, Connie Hedegaard, made clear last week discussing the monetary agreements in lieu of the destabilised Euro does not come at an easy time, especially with money having to be drawn from the public purse.  Therefore funding remains a sensitive yet pivotal topic, especially if alliances are to be bridged between different negotiating groups.

Some aspects of the text being prepared at Bonn remain unchanged from the text prepared at Copenhagen. An example includes the issues surrounding REDD and REDD+, which was hailed as one of Copenhagen’s successes. In addition, the text regarding technology transfer remains unchanged from last year, and this section is considered to deliver a major outcome. The text suggests that establishment of a Climate Technology Centre and Network – the mechanism to support and organise the transfer of technology, encourage collaborative innovation, and skills development for developing countries. It is expected to be funded by the overarching funding mechanism and could begin as early as January 2011. Leading on from technology transfer, discussions so far at Bonn regarding capacity building have been largely inconclusive with additional brackets added to the text, and wide disagreement concerning its funding, delivery mechanism and reporting. With key uncertainties remaining, negotiators at Bonn have a lot of talking to do this week if success is to be achieved in any of these areas and a clear path to Cancun is to be laid.

France has been a leading nation in climate change negotiations in the recent past. French President Nicolas Sarkozy called for a national carbon tax on global-warming pollutants. Generally, he recognizes that “We are on the road to failure…Time is not on our side.” He has even gone so far as to suggest the creation of a new international organisation to deal with climate change. But after major losses to his party in regional elections earlier this year, the government has been backpedaling on things like the carbon tax.

But running up to the Bonn Climate Change Talks (31 May to 11 June), France has continued to organize summits and partnerships striving to move forward the UNFCCC climate change negotiation process. Prime among these have been: 1. the Oslo-Paris REDD negotiating process and 2. the Africa-France Summit.

Paris-Oslo process was initiated by France and Norway to build on progress made at the Copenhagen last December towards an international mechanism to fund forest protection. The program — called REDD Plus, for Reducing Emissions from Deforestation and Degradation — will encourage rich nations to voluntarily finance forest-protecting projects while coordinating that aid to avoid waste and ensure transparency.

During the last meetings of the Paris-Oslo process on 27 May 2010 in Oslo more than $4 billion had been pledged by developing nations to kick-start international REDD+ efforts aimed at halting deforestation and restoring forests in developing countries. Effectively, the feeling is that with money on the table and the urgency to halt GHG emissions from the clearing and degradation of tropical forests, REDD+ should move ahead even in the absence of a new global climate agreement.  But there is some concern from NGOs that currently REDD+ lacks indigenous participation and transparency.

France has been taking an active role in brokering relations between Africa and EU-nations. The Africa-France Summit convened from 31 May to 1 June in Nice, France. The Summit addressed the theme of “climate and development.” A main goal of including reconciling climate change with development, poverty reduction, and food security was put forth. European Commissioner for Development, Andris Piebalgs, took part in the Summit. He was adamant that common solutions could come under the broader African-EU Strategic Partnership.

The UNFCC session in Bonn marks the resumption of the climate negotiations within the UN framework. France believes that the UNFCCC should remain central to the negotiations and benefit form the contributions of smaller initiatives, allowing advanced progress to be made on certain tracks of the overall discussion.

Now the world waits to see the effect of the talks France has helped to broker in past months.

It’s been almost a month since the UK’s newly elected, and historic, Coalition Government was formed, introducing an interesting partnership between the Liberal Democrat and Conservative parties. With over 22 bills announced in last week’s Queen’s speech, the Coalition certainly has its work cut out over the next 18 months.

Without doubt, the biggest concern of this Government is the reduction of the national deficit, which stands at a colossal 12% of GDP. However, the newly elected PM, David Cameron, and his Liberal Democrat deputy, Nick Clegg, have pledged that the urgent need to develop a low-carbon economy will remain a key issue and focus amidst deficit reduction plans. To affirm his commitment, one of Cameron’s earliest announcements included a target to reduce central government carbon emissions by 10% within next 12 months. In the same vein, the PM has also committed to push the EU to demonstrate leadership in tackling international climate change, including by supporting an increase in the EU emission reduction target to 30% by 2020.

The Energy Security and Green Economy bill announced in the Queen’s speech last week is expected to deliver some of the pledges made in the Coalition Government’s manifesto (see below). The Bill will focus on maximising energy efficiencies and renewable energy generation through a range of innovative policy measures, including ‘green loans’ for buildings and businesses, designed to increase investment in green technologies and efficiency measures across the UK. Importantly the loans are associated with the building or business and not the individual, enabling owners to transfer payments to new owners if the property/businesses are sold.

However, this Green Deal is the only part of the government’s low-carbon agenda that is currently certain to make it into the final version of the Bill after DECC announced that a host of other legislative measures “may” be included in the legislation. The Department is still finalising proposals for legislation to regulate emissions from coal-fired power stations (with uncertainty around the baseline for performance), provide a framework to govern the rollout of smart grid technologies, lay the foundations for a green investment bank, reform energy markets to enhance security of supply and competition between operators and ensure North Sea infrastructure is open to companies operating in smaller oil and gas fields. Whilst the latter option remains controversial, the Government has made suggestions that it will seek to maximise opportunities for the continued extraction of fossil fuels and opencast mining, ironically exhausting carbon intensive energy resources to build the ‘foundations’ of a renewable and low carbon economy. This has dismayed some environmentalists, who remain skeptical about how this Coalition will set itself apart from the previous Labour Government.

However, the proposals put forward will have to contend with the £6.25bn of public spending cuts also announced last week by George Osborne. Whilst the Department for Energy & Climate Change (DECC) won’t suffer as much as some other Government departments, it is set to lose £85M from its budget, with DEFRA losing as much as £162M. In what he has described as the “fastest and most collegiate spending review in recent history” Osbourne plans to recover the remaining savings in £20.2M cuts to the department’s delivery bodies and a further £26m from other efficiencies, including £6M by targeting lower impact spend in the Regional Development Agencies. In addition, £34M will be cut from business support programmes including moving forward the closure of the Low Carbon Buildings Programme (LCBP), which provides grants to households and businesses installing renewable energy technologies. A new feed in tariff incentive, launched in April 2010 is expected to replace the LCBP and provide incentives for microgeneration of renewable technologies, however with the launch of the Renewable Heat Incentive (RHI) not expected until next year, there are concerns that some parts of the market are exposed to a lack of policy clarity or incentive.

Leonnie Greene of the Renewable Energy Association said producers of biomass systems, ground source heat pumps and other renewable heat technologies now urgently needed clarity on when the proposed Renewable Heat Incentive (RHI) scheme will be introduced.

Whilst many of these cuts are likely to deliver emissions reductions, the Government is faced with the risk of stifling long term green investments, which would inevitably deliver economy wide savings in the future.

Interestingly, two of the government’s most controversial environmental policies – its proposal to enforce a floor price for carbon and reform renewable energy incentives by extending the feed-in tariff – were noticeably absent from the list of measures to be included in the final bill. Whilst the Government has demonstrated some ‘fresh thinking’ on this agenda, there is a sense that there is much thinking still to be done. Inevitably the next 12 months will be critical, and comprehensive consultation, speedy implementation, and strong political direction will determine how well Cameron guides the UK through its worst debt crisis, and critical energy reforms to better position the nation in a future low carbon economy.

The Coalition Government’s vision for decarbonising the UK

1. The establishment of a smart grid and the roll-out of smart meters;
2. The full establishment of feed-in tariff systems in electricity – as well as the maintenance of banded ROCs;
3. We will instruct Ofgem to establish a security guarantee of energy supplies.
4. Measures to promote a huge increase in energy from waste through anaerobic digestion;
5. The creation of a green investment bank to support low carbon projects to transform the economy. As part of the creation of a green investment bank, the Government intends to create green financial products to provide individuals with opportunities to invest in the infrastructure needed to support the new green economy.
6. The provision of home energy improvement paid for by the savings from lower energy bills;
7. Retention of energy performance certificates while scrapping HIPs;
8. Measures to encourage marine energy;
9. The establishment of an emissions performance standard that will prevent coal-fired power stations being built unless they are equipped with sufficient CCS to meet the emissions performance standard;
10. The establishment of a high-speed rail network;
11. The cancellation of the third runway at Heathrow and the refusal of additional runways at Gatwick and Stansted;
12. The replacement of the air passenger duty with a per-flight duty;
13. The provision of a floor price for carbon, as well as efforts to persuade the EU to move towards full auctioning of ETS permits;
14. Measures to make the import or possession of illegal timber a criminal offence;
15. Measures to promote green spaces and wildlife corridors in order to halt the loss of habitats and restore biodiversity;
16. Mandating a national recharging network for electric and plug-in hybrid vehicles;
17. Continuation of the present government’s proposals for public sector investment in CCS technology for four coal-fired power stations; and a specific commitment to reduce central government carbon emissions by 10% within 12 months.
18. Intention to seek an increase in the target for energy from renewable sources, subject to the advice of the climate change committee.

Ministerial Arrangements in the new Coalition Government

Chris Huhne MP has been appointed Secretary of State for Energy and Climate Change in the new coalition government.

Charles Hendry MP and Gregory Barker MP have been appointed as Ministers of State for Energy and Climate Change.

Lord Marland has been appointed as Parliamentary Under Secretary of State for Energy and Climate Change.

The Bonn UN Climate Change Talks in Bonn, Germany is taking place between 31 May – 11 June 2010. Representatives from 182 governments are in attendance, picking up on unresolved issues left over from the UN Climate Change Conference in Copenhagen (COP 15) this past December and putting forward a path for the implementation of international climate change action.

Day 1

The first day of the Bonn Climate Change Talks were dedicated to the SBI and SBSTA opening plenaries. The flexibilities mechanisms were discussed under the SBSTA, with disagreements voiced regarding carbon capture and storage (CCS) and exhausted forests under the CDM, although standardized baselines under the CDM will be discussed.

Yvo de Boer spoke to the press, emphasizing that the two week negotiations will remain on track as long as participating nations maintain their focus on finding a common way forward towards a concrete and realistic goal for the UN Climate Change Conference (COP 16) in Cancún later this year. In addition, he warned that a postponed outcome at the Copenhagen meeting last December does not mean that the impacts of climate change had also been postponed.

A reception hosted by the German government was held later in the evening on Monday to celebrate Yvo de Boer’s tenure as Executive Secretary and wish him farewell.

Day 2

Tuesday marked the opening of meetings for the Ad Hoc Working Group on Long-term Cooperative Action under the UNFCCC (AWG-LCA) and the Ad Hoc Working Group on Further Commitments for Annex I Parties under the Kyoto Protocol (AWG-KP). In addition, contact groups met to discuss technology transfer under the SBI/SBSTA, non-Annex I communications under the SBI, and other issues including documentation on LULUCF, flexibility mechanisms, and methodological issues.

Under the AWG-LCA, the Chair’s draft text was introduced and several parties noted that it was a good basis for beginning the discussions.  However, some delegates noted concern over the loss of a separate section on finance, perceived imbalance, and the potential for a significant growth in text length, as well as the possible impact of time spent in contact groups on the available negotiating time.

Yvo de Boer also addressed the conference, highlighting Copenhagen’s progress toward a technology mechanism, including a climate Technology Centre supported by regional units, raising the potential for partnership opportunities between governments and the private sector.

Day 3

Wednesday’s schedule consisted of contact group meetings and informal consultations. Issues under discussion included national communications, LDCs, the financial mechanism, capacity building, privileges and immunities, Annex I emission reductions, preparation of an outcome for presentation at COP16 (Item 3) under the AWG-LCA, and other issues under the AWG-KP.

Finance was a hot topic of the day, under discussion during the AWG-LCA contact group meeting. The AWG-LCA Chair provided a list of questions regarding the enhanced provision of financial resources which was then discussed during both the morning and afternoon group meetings. Many delegates noted a positive and constructive tone to the discussions, although complaints included discussions going in circles, parties maintaining their pre-Copenhagen positions, and the role of the UNFCCC being threatened by various parallel initiatives.

Day 4

On Thursday, delegates met together for contact groups as well as informal consultations. Issues under discussion included a review of the Adaptation Fund, intergovernmental meetings and capacity building, Annex I emission reductions, research dialogue, the Buenos Aires programme of work (decision 1/CP.10), and preparation of an outcome for presentation at COP16 (Item 3).

The fourth day of negotiations took on a positive tone with signs of progress. A proposal put forth by AOSIS and backed by several other developing countries called for joint discussions between the two AWGs of Annex I emission reductions (limited to Annex I countries). This proposal was well received although broader joint discussions on the topic of mitigation still face large opposition. In addition, the US and some other developing countries might not be on board with the AOSIS proposal. Also making headway, the LULUCF submission by developing countries received positive response along with the agreement to reconstitute the legal issues group under the AWG-KP.

Day 5

On the fifth day of negotiations, the AWG-KP plenary took place and contact groups and informal consultations occurred. Topics under consideration included Annex I national communications, Annex I emission reductions, arrangements for intergovernmental meetings, preparation of an outcome for presentation at COP16 (Item 3), technology transfer, and the focal point forum under the NWP convened.

Discussion over COP16 and side event arrangements took place and speculation arose over the still-undeclared location of the negotiating session taking place this autumn ahead of Cancún. The hope for joint discussions between the two AWGs was not as strong as the day prior. However, the energy may rise again when delegates meet for the final week of the Bonn climate talks.

Day 6

The second week of negotiations on Monday began with more contact groups and informal sessions. Under discussion: the Buenos Aires program of work (Decision 1/CP.10), preparation of an outcome for presentation at COP16 (Item 3), capacity building, the scientific, technical and socio-economic elements of mitigation, and Annex I emission reductions.

The topic of the joint meeting of the two AWGs arose again following the weekend hiatus. Of focus on Monday was the issue of common space for the AWGs, but no consensus has yet been reached. Despite support from AOSIS and various countries in Latin America, the US had not indicated that it would get behind such a meeting and some countries amongst the G-77/China remained in opposition.

LULUCF has also been receiving attention this week: transparency in LULUCF accounting is appearing to gain headway, a common position on reference levels was taken by the G-77/China, and reference constructions are showing signs of opening up.

Day 7

The topics of discussion during Tuesday’s contact groups and informal consultations included: the financial mechanism, capacity building, national communications, review of the Adaptation Fund, preparation of an outcome for presentation at COP16 (Item 3), and Annex I emission reductions.

With closing plenaries taking place on Wednesday, not much new was presented as delegates worked hard to wrap up issues under consideration over the past week. At noon, an informal briefing took place by the UN Secretary General’s High-level Advisory Group on Climate Change Financing (AGF) in which members announced that  potential finance sources are currently being prepared in a report which is hope to be completed and presented before COP16 in November.

Day 8

Wednesday marked the end of the climate talks in Bonn. Contact groups and informal consultations took place during the day to discuss Annex I emission reductions and the preparation of an outcome for presentation at COP16 (Item 3). Later in the day, the SBI and SBSTA convened for their closing plenaries.

On Wednesday afternoon, a joint SBI/SBSTA session took place in order to say farewell to the outgoing UNFCCC Executive Secretary Yvo de Boer. Thanking the negotiators, IGOs, NGOs, industry, and his colleagues for their work over the past fourteen years, de Boer stated that “we do not have another fourteen years” to show that the UNFCCC can deliver progress. He noted that as negotiators work towards a legally binding agreement, there are divergences over the meaning of “legally binding” which serves as an advantage as it enables a broad definition. He further emphasized that agreements on several complex subjects cannot be reached with “15,000 people in the room” but through a “clear mandate to work in a smaller group and report back to the COP.” In his closing remarks, de Boer concluded that negotiators “will not only try, but also succeed.”

Read Yvo de Boer’s farewell statement here.

Further Reading

Bridging the road from Copenhagen to Cancún – Can the Bonn Climate talks lay any firm foundations? (Posted 31 May 2010 by Sabrina Chesterman)

France has prepared for positive Bonn outcome (Posted 6 June 2010 by Jennifer Helgeson)

Bonn Climate Talks: Paving the way to Cancún (Posted 8 June 2010 by Sabrina Chesterman and Nyla Sarwar)