ECO Newsletter

ECO notes that there are some signs of progress in the negotiations on climate finance accounting. SBSTA started the week with a 62-page document and is now down to two competing and polarised submissions of 9 and 4 pages respectively. At the time of writing, the co-facilitators were boiling the submissions down into a new (presumably shorter) text.

With this new text in hand, ECO hopes that negotiators will not be as drastic with their scissors, as the 4-page submission made by Australia, the US and Japan might indicate. Their proposal on accounting modalities basically brings us back to square one, where each developed country is more or less allowed to report climate finance on their own terms. The submission offers very little by way of ENHANCED transparency, comparability and accuracy, which the provision of climate finance desperately needs.

Based on their proposal, it seems that Australia, the US and Japan are not up for reporting the grant equivalent value of any loans and other non-grant instruments – which is a key element in the 9-pager from the G77 and China. They would rather continue to inflate their numbers by reporting the full face value of loans, despite the fact
that on average, developing countries are likely to have to pay back about half of the value of these loans.
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In the midst of the finance ‘storm’ falling on Bangkok, everyone wants to know what is next for the Green Climate Fund (GCF)?

ECO watched, with great disappointment, events unfold at the last GCF board meeting. While countries failed to come to any kind of agreement regarding procedural issues, the collapse of the last board meeting also postponed the approval of 11 projects, valued at almost $1 billion. These delayed projects have direct impacts on the ground. A three month delay means precious time lost for those who still require support to tackle the increasingly hostile impacts of climate change, to access renewable energy and to build low carbon and climate resilient societies.

So what’s the GCF all about? Supporting climate action around the globe, particularly for the most vulnerable countries. Created 8 years ago, the GCF is still a critical financial mechanism for countries to deliver much needed financial support and is the core multilateral fund to allow for full and fair implementation of the Paris Agreement. Since its inception, the GCF has proved that it is able to support a growing and diverse portfolio of projects. The quality of these projects has increased over time, and has helped support direct access entities and build the capacities of national implementing agencies.
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Developed countries have long been fans of the “do as we say, not as we do” approach to climate diplomacy; so it should come as no surprise that they’ve adopted this approach to loss and damage in advocating for climate insurance as the solution.

As much as surely can be clear after the first days of this week; some developed countries still think, “Loss and damage is not a thing”. Yet, they have fallen over themselves to push vulnerable countries to take up climate insurance to deal with this “non-thing”. In fact, in the face of much more effective and evidence based solutions, they have pushed climate insurance as almost the sole response.

A new report, Not a Silver Bullet from the Heinrich-Böll- Stiftung, foundation shows how misplaced this reliance on ‘insurance only’ is. Not only is it doubling down on the injustice of climate change to expect vulnerable countries to pay insurance premiums to cover a risk they did not create, but also, insurance alone is just not up to the task at hand. In the best case, insurance pays out a very small portion of the costs of loss and damage. Typically only two percent, as in the case of Dominica, where the costs of Hurricane Maria fell overwhelmingly on ordinary Dominicans, and other examples outlined in the report.
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We know we’ve raised it before, but we realized yesterday that it was worth another reminder as none of our concerns were raised during the transparency discussions: the Facilitative, Multilateral Consideration of Progress (FMCP) will only be effective if it builds on the expertise and perspectives of civil society. Unless you step up, we risk ruining what could be a constructive process. So let us try present- ing it in a different medium…namely, in a song! We sincerely hope you get this song stuck in your head.

(The song should be read in a sing-song-y voice to the tune of Village People’s YMCA)

Party, there’s a place we can go.
I said, Party, let us compliment your info
You can play there, and I’m sure we will find
Many ways to have a good time

It’s fun to be – a – part of the F.M.C.P.
It’s fun to be – a – part of the F.M.C.P.

We could provide info, we could send in questions,
We will add some action…

Party, are you listening to me?
I said, Party, what do you want to be?
I said, Party, you can make the PA strong.
But you got to know this one thing!
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Market negotiations resumed at full speed in Bangkok, with new text being published after only one day of negotiations. Parties are feeling the pressure now that COP24 is looming. We’ve started the session by hearing lists of priorities for items that could not be postponed to 2019 (assuming that not all issues could be resolved at COP24). Two of these priorities stick out for ECO: the need to avoid double counting through corresponding adjustments for all international transfers, and the transition away from Kyoto Protocol Mechanisms to Article 6. This applies especially to avoiding double counting with ICAO’s CORSIA! ECO shares the view that these are crucial priorities if market mechanisms are to increase ambition, but one critical priority was missing. We need to ensure compliance with human rights and social safeguards to avoid the ghosts of the Clean Development Mechanism (CDM) coming back to haunt us after 2020.

Now urgently need to operationalize rules in order to ensure that the new market mechanisms can start on the right foot and promote ambition in the Paris Agreement. After hearing Parties mention the transition from Kyoto Protocol (KP) mechanisms to Article 6 as a key priority, we were surprised when we discovered that there is no strict timeline to deal with the transition of these elements within the documents drafted by the co-chairs.
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It’s all well-known – the UNFCCC negotiations are progressing at a slow pace, the workload and delivery is lagging behind schedule, and the parties’ enthusiasm on rapid and early enhancing of ambition to meet the Paris objectives is hardly visible, particularly with the looming COP in Poland. But here comes the IPCC to the rescue – hopefully.

As we all know, as a result of the Paris negotiations in 2015, Parties commissioned the largest global climate science authority, the IPCC, to assess in a Special Report the feasibility of meeting the objective to limit global warming to 1.5°C, and what failing to meet the goal would entail. After two years of work by a large number of expert scientists, the report and particularly its Summary For Policymakers (SPM) will be negotiated and agreed upon in Korea by Parties in early October. By nature, the findings of the IPCC will have significant impacts on governments’ climate policies and domestic implementation, the Talanoa Dialogue and the necessary enhancement of the 2030 NDC. The question remains – which political impacts?

ECO has always defended the IPCC and its many products over the years as fundamental parts of advocating awareness and solutions to the global climate crisis.
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The beauty of the Technology Mechanism (TM) is that it has dozens of “TEC Briefs” on a large number of topics that can help countries understand which adaptation and mitigation technologies might be best for deployment in their own countries.

These TEC (Technology Executive Committee) Briefs are invariably based on data collected from sources such as Technology Needs Assessments and Climate Technology Centre and Network (CTCN) efforts that date back to as far as two decades and Technical Assistance that is given via the CTCN. In addition, the Technology Executive Committee (TEC) data might also be used to inform transparency and the Global Stocktake.

But here’s the rub. Despite decades of helpful data collection, the new TM transparency tool, the Periodic Assessment of the TM, is being designed in a way that turns more toward qualitative indicators and much less toward the quantitative data that is so helpful, for example, to identifying Transformational Technologies. In fact, the word “DATA” is nowhere to be found in the paper. This is a mistake of monumental importance. Informed by the Technology Framework it is understandable that LDCs and others need to conserve resources in the collection of data. But a serious plan for collecting both qualitative and quantitative information can be devised to minimize cost while retaining content.
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Four months have already passed since our last meeting, and ECO is glad to see you back in Bangkok. Something we did not hear in the Opening, which is a crucial point, there’s only three months until COP24. That is where the Talanoa Dialogue must end with a strong outcome calling on countries to step-up ambition of NDCs and support by 2020.

If the Paris Agreement is an aircraft, the rulebook is the engine – it requires a lot of technical knowledge and its reliability is crucial. ECO knows many technical experts came to Bangkok to prepare some of the necessary hard work on the engine and want to spend time in the machine room. But ambition and the Talanoa Dialogue are the wings of the aircraft. And only if they are big enough, will it fly. Ambition is part of the overall package that Parties need to deliver at the COP – surely this is something that Parties and COP Presidencies alike recognise.

The stories shared in Bonn lay the groundwork and can be explored further around the world, to learn from, and build on them when updating the national climate plans. ECO was glad to see many promising elements in the Summary Report such as the need to enhance ambition, references to the IPCC Special Report and the UNSG Summit as well as a call for increased cooperation.
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Remember this table, Parties? It has changed slightly, but not nearly enough since Bonn. It is now too late for the second commitment period of the Kyoto Protocol (KP2) to enter into force by COP24 and the stocktake on pre-2020 implementation and ambition. Slow and steady just won’t do when we’re trying to honor and implement treaties to fight global disasters.

Thank you, Belize, Benin, Eritrea, and Niger, for ratifying the Doha Amendment to the Kyoto Protocol since we were all together last time. We still need 29 more Parties to join them and the other KP2 ratifiers in order to reach the threshold of ¾ of Parties to the KP to secure entry into force, however. Paradoxically, we find more than 29 candidates among some of those countries and groups most vocal about the urgent need for Doha ratification, as you can see from ECO’s helpful table.

In January 2018, non-ratifiers received letters from the Fiji COP President and the UNFCCC Executive Secretary, urging them to ratify the amendment. If your decision-makers have failed to see the relevance, please remind them that the Doha ratification will make it possible to hold developed countries accountable to their pre-2020 commitments, and that failure to ratify and implement the KP2 sets a worrying precedent for the Paris Agreement.
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