International impetus on climate change not replicated domestically

International Success…

On the international stage, Indonesia can claim with some justification that it is leading the way in advancing the climate change agenda. In the last month alone, Indonesia has been active in:

• Putting the role of oceans on the climate change map as well as signing the Coral Triangle Initiative (discussed in last week’s blog);
• Releasing the world’s first REDD rules on how tradable carbon credits will be generated, detailing where REDD projects can take place and who can do them. Although questions have been raised as to how the carbon credit revenue will be shared between the project developers and the government, these rules are nevertheless a milestone in making the REDD scheme a reality;
• Linking any future REDD scheme with a concerted effort to address illegal logging, going as far to suggest that illegal logging could undermine REDD.

… Domestic Gloom

On the domestic front, however, concern is growing that Indonesia is not so committed. As pointed out by this blogger, even though the Presidential elections are next month, climate change is conspicuous by its absence from the election campaign. This is despite the dangers faced from rising sea levels and increased incidents of forest fires (which have already started and are projected to worsen significantly this year). Furthermore, the current economic crisis has resulted in a budget deficit totalling US$13.47 billion. Plans are afoot, however, to plug this gap with loans that are expressly allocated to climate change. As Basah Hernowo, the Bappenas director of forestry and water resource conservation says while the French and Japanese have agreed to give additional loans of $100 million, on top of the $500 million already agreed, towards reduction measures, “the government will use the money to cover the budget deficit”. And the reason given? “The loans for climate change issues have cheaper interest rates compared to other loans”.

This is extremely disturbing and raises the question of what the donor countries will do, especially as there is a monitoring mechanism in place to ensure that the money is spent on climate change projects. It also brings a more negative spin on the international achievements listed above: it suggests that internationally Indonesia is pushing the climate change agenda in order to secure more revenue for the general budget. While it could be argued that it is up to Indonesia to decide what it spends its budget on, one would expect enlightened self-interest to make climate change a top domestic priority. The signs so far however are not promising.

Geithner, Obama, and Brown

As expected, the global economy took center stage at the G20 Summit held yesterday in London. Amidst the world economic crisis, G20 leaders met to discuss and put forth a global plan for recovery. Included amongst the six pledges made by the leaders of the Group of Twenty was a pledge for a green and sustainable recovery. However, despite this pledge and the hopes of many demonstrators, the public, and officials, climate change and plans for a green recovery featured little in the day’s discussions.

Over the weekend, the official G20 communiqué leaked to the press and included only vague language on the topic of climate change. According to paragraphs 27 and 28 in the official communiqué:

27. We agreed to make the best possible use of investment funded by fiscal stimulus programmes towards the goal of building a resilient, sustainable, and green recovery. We will make the transition towards clean, innovative, resource efficient, low carbon technologies and infrastructure. We encourage the MDBs to contribute fully to the achievement of this objective. We will identify and work together on further measures to build sustainable economies.

28. We reaffirm our commitment to address the threat of irreversible climate change, based on the principle of common but differentiated responsibilities, and to reach agreement at the UN Climate Change conference in Copenhagen in December 2009.

The vague language of the communiqué led to speculation that a “green stimulus” package might be less than concrete. This sentiment continued in the days leading up to the Summit.

Therefore, the day began with slightly lowered expectations for the one-day summit. Much of the morning for reporters was spent researching, writing, and watching leaders get their pictures taken. Anticipation and excitement began to grow as delegates sat down for their plenary session in the morning. However, not until close to 2:00 PM did green issues appear on the agenda with a press conference held by the UK Climate Change Secretary, Ed Miliband.

In the early afternoon, Miliband surprised reporters with a short press conference to brief them on the progress of climate change discussions and answer questions. Miliband stated that he was confident that the G20 Summit would provide forward movement towards Copenhagen in December. The discussions would serve to facilitate the process toward Copenhagen and would be used to make a statement to China and other developing countries that the United States, UK, and EU countries were committed to tackling climate change.

Climatico’s Simon Billett asked Miliband whether this talk of “first steps” was anything more than “agreeing to agree?” In response, Miliband stated that while the G20 summit was “essentially an economic summit,” among the G20 participants existed the understanding of the “mainstreaming [of] the green message.” Furthermore, Miliband said that countries such as Saudi Arabia and Russia are more likely to attach importance to renewables despite prior hesitation. “This is a significant step in mainstreaming low carbon development in economic recovery…The notion of low-carbon as a way out of recession has gone from being marginal to being mainstream.”

Miliband went on to say that forestry is a fundamental element in the climate program and will be discussed in Italy at the G8 meeting in July. Billett noted that forestry proved a major topic of conversation within the corridors of the Summit. Furthermore, private discussions between German Chancellor Angela Merkel and Australian Prime Minister Kevin Rudd regarding the importance of including forestry in a global climate deal adds to the speculation that forestry will be a topic to watch in the months to come.

Despite Miliband’s press conference, the topic of climate change once again became quiet over much of the afternoon. During his speech, French President Nicholas Sarkozy failed to reference any discussion on the topic of the environment. And, despite Miliband’s enthusiasm, UK Prime Minister Gordon Brown only restated that the G20 was committed to meet again later this year to discuss a Post-Kyoto climate deal.

However, U.S. President Barack Obama brought climate change back onto the floor during his press conference late in the day. Obama’s trip to London included several bilateral meetings with the leaders in attendance outside of the context of the G20. In response to a reporter’s question from the Times of India, Obama addressed a bilateral meeting he had with Indian Prime Minister Manmohan Singh. Amongst other points of discussion, Obama and Singh touched on the issue of “energy and how important it is for the United States to lead by example in reducing our carbon footprint so that we can help to forge agreements with countries like China and India…for our efforts to control climate change.”

Obama alluded to future discussions on the topic of climate change with China. In addition, he recognized the challenges that lie ahead for the topic amidst the current economic crisis. “In some ways, our…European counterparts have moved more quickly than we have on this issue, but I think even the Europeans have recognized that it’s not easy. It’s even harder during times of economic downturn.” He went on to add, “We’re going to have to combine the low-hanging fruit of energy efficiency with rapid technological advances. And to the extent that in some cases we can get international cooperation and pool our scientific and technical knowledge around things like developing coal sequestration, for example, that can be extremely helpful.”

Obama’s speech wrapped up the events of the day. However, despite a long day of meetings and press conferences at the G20 Summit, action towards green growth remained largely undefined. As to be expected, the world economic crisis was the star of the show and, therefore, plans to repair the global economy held the spotlight. Yet, often this subject turned to the discussion of bank regulation and executive pay rather than outlining plans for green growth. Despite all of this, environmentalists can rest assured that the international dialogue on climate change has begun to move forward. Furthermore, as demonstrated in Obama’s press conference, the United States appears onboard for further discussions and acknowledges its role as a leader and partner in reaching a climate change deal come December. Between Obama’s acknowledgement that the US must lead by example and Miliband’s enthusiasm for momentum, hopefully the G20 will prove a success for environmentalists, after all, by bringing in greater participation, particularly by China and India, at Copenhagen later this year. We shall have to wait and see.

Solar shop, Ladakh. Photo: Flickr/Ajay Tallam

After a quiet quarter and a fairly dull interim budget, the government today launched an ambitious project as part of its climate change policy, falling under two of the missions laid out in the NAPCC: the National Solar Mission and the National Mission for Enhanced Energy Efficiency. Under the Ministry of New and Renewable Energy’s project to increase the use of solar power, Nagpur, a town in the state of Maharashtra, is set to become the first of 60 ‘solar cities’ in India. These cities will source at least 10% of their power consumption from renewable sources and the city will be energy efficient. 

It’s well known that India suffers from acute power shortages. As the temperature rises, so does the demand for power, which stresses the already stretched power grids. For example, states like Karnataka depend on a mix of hydroelectric and thermal sources of power and, like Kerala, are dependent on the monsoon for meeting their electricity requirements. A bad monsoon or unexpected rises in temperature (like this year) invariably mean power cuts and load shedding.

As India’s policy on climate change points out, solar power has great potential in India for many reasons. Firstly, we get a lot of sunshine (over 300 days of sunlight a year); secondly solar power distribution can be decentralised, and in that sense it is ‘empowering people at the grass root level’. Thirdly, it will reduce our acute power woes and finally, India’s need for solar power supports innovation, technology transfer and international cooperation. Electrification of rural areas is also electorally powerful. 

This project has great potential economically. Renewable energy markets are becoming attractive investments - HSBC’s renewable energy wing is looking to invest heavily in solar and wind projects in Asia and as mentioned earlier, Gujarat’s latest investment summit attracted a number of private partners for renewable energy projects. Supported partly by the recession’s cost cutting nature and burgeoning awareness on environmental and energy management amongst people in India, energy efficiency is becoming more and more important as well. The recession may be good for the eco-realty sector as energy efficient and eco friendly buildings are becoming fashionable. Investing in solar projects like this will bring down the costs involved in setting up solar energy sources as well. 

As a government report on India’s energy security recommended in 2006, solar technology is “the only renewable energy source with sufficient potential to meet almost all our energy needs, we should give high priority to [the] development of solar technology”. The plan doesn’t give too many details into the hows and whys, but it comes at an opportune time when power, economic efficiency and the environment are becoming priorities on the Indian consumer’s list.

Mexico’s willingness to commit to voluntary emissions caps at COP-14 put it at the forefront of climate change mitigation efforts in Latin America, and made the country the example to follow for other developing nations. But Mexico’s efforts to implement climate change policy this year and in the future will be challenged and shaped by historical, political, and national baggage.

In order to put effective measures in place and meet the country’s 2050 targets, Mexican legislators and citizens will have to think creatively about how to incorporate—or circumvent—the issues currently attached to climate change reform on the Mexican agenda.

1. Location, Location, Location. Prior to Poznan, Mexico had been focused on situating itself in relation to other countries in terms of threat and responsibility. During the first week of COP-14, Reforma, one of the country’s major newspapers, published articles that highlighted Mexico’s position as the world’s twelfth largest emitter, and as the seventeenth country on Germanwatch’s list of nations most at risk from climate change. Post-2050 commitments, the challenge will involve setting self-comparing objectives, and moving away from the shadow of international rankings and towards the more serious business of national leadership.

2. Reactive Agency: Mexico implemented very few new climate change initiatives in the first half of 2008. Though Juan Rafael Elvira Quesada, Minister of the Environment and Natural Resources, had declared in November 2007 that the “inactions of other countries” would not be “a brake” for Mexican policy, he had also joined Indian and Brazilian leaders in putting economic and social development at the forefront of Mexico’s priorities. Up until Poznan, Mexico had relied heavily on positive rhetoric backed up by very limited action. This year will require a forward-thinking and innovative attitude on the part of Mexican climate change strategists, including legislators, if Mexico is to begin movement towards meeting its 2050 goals.

3. Preparation is Key: Though Mexico’s voluntary emissions caps announcement was hailed as a surprise, it is clear that Mexican policy-makers had been preparing for appropriating a new stance on climate change at the global level. President Calderón met with Al Gore in 2007, and in October of last year, Mexican Senators met with US government representatives from the EPA, in a day-long event focussing on climate change issues. A law issued by the Mexican Congress on October 28 called for the design of a Estrategia Nacional Para la Transición Energética (National Strategy for Energy Transition), which included a focus on climate change mitigation, seemingly in preparation for Mexico’s intervention at Poznan.

4. A Private Matter: All energy reform debate in Mexico must and does take place within a controversial context of conversation about the possible privatisation of nationalised oil resources. The structure and national ownership of PEMEX (Mexican Petroleum) established after a government expropriation of all oil resources from international companies in 1938, is considered sacrosanct by many. Powerful nationalist lobbies try to block all energy reform issues (and climate change mitigation measures will be no exception) in Congress by garnering public support through a rhetoric of threat and national economic loss. Whether the language of environmental concern will be able to supplant (and so overcome the obstacle of) this historically entrenched conversation remains to be seen.

5. Where the US leads… Mexico must follow. Over the next two years, one of the Mexican government’s primary priorities will be establishing a rapport with a new American administration. At the top of the agenda will be migration, drugs and drug trafficking, and trade agreements (Mexico sends the majority of its export goods to the United States). Climate change may well lag behind other issues, and if the United States chooses to forego climate commitments in favour of dealing with the economic crisis, it has the power to pressure Mexico to push the climate issue to the bottom of its national agenda, too.

6. …but where the US has lagged, Mexico is now leading. Mexico’s willingness to take on emissions commitments in the current economic context is a contrast to Obama and Biden’s more conservative energy plan. Obama’s early enthusiasm on climate issues has waned as other concerns have waxed, and this has opened the possibility for Mexico to be a regional leader on the issue in Obama’s first term. Obama has said he will release an ambitious energy plan once he is in office, however, and the two countries’ bilateral relationship will heavily influence Mexico’s climate change policy.

7. A Proactive Legislation Approach. President Calderón’s ‘personal commitment to climate change’ (as it has been described by senior legislators in the country) has pushed the executive to gather political capital to deal with the issue during the first two and a half years of his term. Resonating interests within the PRI and PRD (the main opposition parties) and the Partido Verde (the Green Party, which has bizarrely focussed, of late, on lobbying for the death penalty for rapists and kidnappers, seemingly forgetting its green legacy) has allowed for progressive legislative action on climate change. As Marie Karaisl has commented elsewhere on this site, Calderon’s new economic crisis plan has made an effort to include green considerations. Mexico must continue to pursue the legislative angle of climate change mitigation efforts aggressively in order to meet its 2050 targets.

8. Putting its money where its mouth is. The economic crisis will have a considerable impact on Mexico’s capability to tackle climate change, as it will on nations around the world. A new law on renewable energy sources allocates $3 billion pesos for the Fondo Para la Transición Energética y el Aprovechamimento Sustentable de la Energía (Fund for Energy Transition and Sustainable Energy Usage). Mexican legislators must carve out an economic space for climate change policy, if it is to be implemented alongside concerns more pressing to the public, such as the fight against crime and drugs, and welfare and benefits issues, during the economic crisis.

9. “Education is the best provision for old age”: As Mexico has emerged into its new role as a climate change leader in Latin and North America, its first priority—and perhaps its biggest challenge—in 2009 must be education. Mexico’s current climate change strategy includes an ‘education and awareness’ element, as evidenced by the recent Ley para el Aprovechamiento de Energías Renovables y el Financiamiento de la Transición Energética (Law for Renewable Energy Usage and Energy Transition Financing).  But if Mexico is to overcome both the historical legacy and the current obstacles that stand in the way of decisive action on climate change in the country, it will require the full support of an informed, and concerned, population.

At Poznan a number of developing countries - China, Mexico and Brazil - took the opportunity to announce new climate change initiatives. Indonesia’s initiative, one of the world’s top 20 greenhouse gas emitters, was conspicuous by its absence and, given recent disagreements over budgetary control, we shouldn’t expect anything soon.

The body expected to take control is the National Board on Climate Change (DNPI). Formed in July 2008, its key aim was to implement the National Action Plan announced in 2007, coordinating the actions of 17 government ministries in:
• Formulating new climate change mitigation policies;
• Regulating the country’s carbon trade system;
• Overseeing development projects so to measure and control emissions;
• Taking the lead internationally in demanding developed countries take more responsibility for climate change.

This unified approach didn’t last long, however, with problems emerging in October 2008. The National Development Planning Board (Bappenas) announced that, along with the Finance Ministry, it was setting up a climate change trust fund to manage mitigation financial support from donor countries. However it was not until this week that the DNPI hit back reiterating that all funding for climate change would fall under the council’s control with Rachmat Witoelar, the Council’s director, declaring “as a national council we will manage all activities related to climate change in the country. All incoming money from donors will go through the council, including spending the donor money”.

The importance of the disagreement becomes apparent when numbers are mentioned. So far the US, Germany and Australia have pledged some $6o million in grants to combat climate change. The real prizes are the soft loans from countries like Japan who is providing up to $300 million for climate change mitigation as part of its “Cool Earth Promotion Programme“. Furthermore there could be much more on the way from the Reduction in Emissions from Deforestation and Degradation (REDD) scheme.

A cynic may suggest that having presidential and legislative elections in July may have something to do with this. But even then surely, one may ask, the money will still be used for climate change policies. Well this seems more a hope than a certainty as the trust fund will not have the same focus on climate change as the DNPI. This was made abundantly clear when the Bappenas director of forestry and water resource conservation, Basah Hernowo, stated “the trust fund will decide where the loans go. It can also be used to plug the deficit in the state budget”. Given the economic crisis and global recession, it is a valid, yet worrying question to ask how much of the donor’s money will actually be spent on climate change.

A few days ago, Mexico’s president F. Calderon announced the Agreement to support households and employment (Acuerdo de Apoyo a la Economía Familiar y el Empleo) to abate the impacts of the economic crisis. Having discussed the possibility of integrating climate change concerns into economic recovery with 70 high level policy makers at the GLOBE meeting in November, Mexico’s anti-crisis plan indeed shows some green features.

1. The government will support families to exchange their old household appliances with new energetically more efficient ones.
2. Part of the employment created under the Temporary Employment Programme will be used for cleaning up forests and water bodies from garbage (garbage is the main methane emitter in Mexico).
3. Mexico will speed up its Infrastructure programme focusing on improving PEMEX oil distribution infrastructure.

The administration certainly shows good will; whether the net effect will be “climatically” positive or negative depends on the net effect of other crisis policies such as the reduction of industrial electricity tariffs and the accelerated extension of road and highways.

Mexico ended the year 2008 with great expectations regarding climate change action for the year to come: demonstrating leadership, it announced voluntary emissions reductions through a cap-and-trade scheme to be operational by 2012. But the efforts necessary for this undertaking could be seriously hampered by other national priorities: the fight against organized crime - and of course the economic crisis.
A look at planned government spending for 2009 demonstrates the prioritization: in November, congress approved a budget of US$ 170 billion. According to the Secretaría de Hacienda (Mexico’s Treasury) aggregating planned expenditures across the security sector (the Ministry of Security, special programmes, law and order, etc), will amount to USD 6.7 billion an approximate 30% increase compared to last year’s spending. The Ministry of Environment (SEMARNAT) will receive an approximate USD 3.3 billion.
The prioritization of security is further evident in official discourse, especially of President Calderon who has come under heavy pressure from civil society to improve the currently dismal security situation. News agencies differ on the exact number, but this year between 3,000 and 5,000 people have been murdered partly due to the response of the drug cartels to the fight against organized crime that President Felipe Calderon initiated in 2006. Moreover, Mexico by now leads the list of countries with the highest number of kidnappings before Iraq and Colombia. Yet, organised crime may impinge on environmental efforts more directly: undermining environmental regulations and legislation where it is cheaper for polluters to bribe themselves out of their obligations and responsibilities.
Apart from security issues, Calderon has approved an extensive infrastructure expansion plan, partly to counterbalance economic losses caused by Mexico’s direct dependence on the ailing US economy. The 2009 budget, allocates USD 5 billion to infrastructure development, 2/3 of that money into roads and highways. Taking a pessimistic view, these infrastructure projects may simply eclipse environmental and climate mitigation efforts such as reforestation, and induce additional demand for road transport. From an optimistic point of view, these investments in infrastructure development may create an opportunity to identify and incorporate sustainable solutions into infrastructure planning and design.
This year’s congress elections are a third factor that will influence climate change and environmental policy most likely negatively given the above two priorities. In any case, Mexico has certainly an interesting year ahead.