The Province of Québec in Canada and the U.S. State of California held their first joint auction of greenhouse gas emissions allowances on Nov. 25. Québec Premier Philippe Couillard talked ahead of the auction about the value of a price on carbon in building a cleaner economy.
The latest report from the Intergovernmental Panel on Climate Change (IPCC) tells us that to rein in climate change and keep global warming under 2°C, we will have to start reducing emissions now and get to near net zero emissions within this century.
That won’t happen without healthy forests and soil storing carbon, and it won’t happen without climate-smart land-use practices that can keep carbon in the ground.
Together, agriculture, forestry and other land use changes account for about a quarter of anthropogenic greenhouse gas emissions. The sector can be a powerful source of emissions, but it is also a powerful carbon sink that can absorb carbon dioxide, providing a pathway to negative emissions. The IPCC authors estimate that with both supply-side and demand-side mitigation efforts – including reducing deforestation, protecting natural forests, restoring and planting forests, improving rice-growing techniques and other climate-smart agriculture methods, changing diets, and reducing the immense amount of global food waste – we can effectively reduce a large percentage of emissions from the sector and increase carbon storage to move the needle toward net zero.
Over the next few months, governments worldwide will be preparing their national contributions to our collective need to combat climate change. These plans will form the foundation of a new international climate agreement to be agreed in Paris in one year’s time. Collective ambition matters now more than ever. We all have a responsibility to make the choices that will lower the risks created by decades of greenhouse gas emissions and usher in an era of job-rich, more-inclusive, cleaner economic development.
Scientists have provided us with a remarkable consensus. We believe that with this evidence, we have the strong foundation for action. That’s good news, because climate action has to scale up now.
This week and next at the UN climate negotiations in Lima (COP20), there is a sense that gridlock may be easing. The U.S. and China – the world's two largest emitters – set a strong pace last month when Presidents Barack Obama and Xi Jinping stood together and jointly announced their top-line commitments for cutting emissions. Their pledges, along with commitments from the European Union and donor support for the Green Climate Fund, auger well for the Lima talks. But this was always billed as the finance COP, and how we finance the transition to deep decarbonization and lasting resilience requires a coming together that has eluded us to date.
The past five weeks have given us what may be defining moments on the road to a Paris agreement that will lay a foundation for a future climate regime.
- On October 23, European Union leaders committed to reduce greenhouse gas emissions by at least 40 percent by 2030 and increase energy efficiency and renewable energy use by at least 27 percent by 2030.
- On November 12, during the APEC Summit in Beijing, Chinese President Xi Jinping and United States President Barack Obama jointly announced their post-2020 climate mitigation targets: China intends to achieve peak CO2 emissions around 2030, with best efforts to peak as early as possible, and increase its non-fossil fuel share of all energy to 20 percent by 2030; and the U.S. agreed to cut emissions by 26-28 percent below 2005 levels by 2025.
- On November 20, at the donor conference in Berlin, led by the U.S., Germany, and others, donors pledged about US$9.3 billion to the Green Climate Fund (GCF).
China’s announcement in particular is considered by many to be a game changer. China, the world’s biggest emitter with its emissions accounting for more than 27 percent of the global emissions, is setting an example for other major developing countries to put forward quantifiable emission targets. The announcement will hopefully also brush away the “China excuse,” used by some developed countries that have avoided commitments on the grounds that China was not part of action under the Kyoto targets.
“How do you engage a country that may not agree with your climate agenda?”
The question came last week, as I was sharing the findings of our recent report, Climate-Smart Development: Adding up the benefits of actions that help build prosperity, end poverty and combat climate change with students from the Williams College Center for Development Economics. I hope my talk answered her question. I pointed out that increasingly, decision-makers want to know if there are investment decisions they can make that address urgent development priorities and, at the same time, address the challenges of a rapidly warming world.
Three articles in the news this week reinforce the messages in our report and shed further light on the answer to her question. A pair of research papers point out that black carbon and ground-level ozone – air pollution associated with so-called short-lived climate pollutants, or SLCPs – are already reducing Indian agricultural yields by up to half, and that coal-fired power – a large source of air pollution including CO2 – is costing China 670,000 deaths each year. These are both prime examples of local development issues that present climate-smart investment choices. As governments search for solutions to their health and agriculture problems that are exacerbated by air pollution, they have two options: invest in smoke stack controls and other interventions that eliminate the air pollution causing crop loss and mortality, but keep churning out CO2, or invest in alternative energy sources and efficiency measures that will also reduce both forms of climate pollution.
By Kerry Adler, President and CEO of SkyPower
The fundamental inequality that exists between emitters of carbon and the victims of its devastating byproduct requires global cooperation and intervention beyond our willingness to act thus far. Today, we have the necessary technology, ingenuity and global monetary tools to incentivize a shift to cleaner energy.
Placing a price on carbon enhances the competitive position of renewable energy technologies, such as utility-scale solar, relative to fossil energy, thus encouraging migration away from high-carbon fuels. It is an important step, and it can be supported with other initiatives to ensure accountability.
In the private sector, transparency regarding carbon emissions is essential. With the advent of the Internet and the plethora of information available today, it is not only possible, but imperative that emitters of carbon are held accountable in a public forum.
By Valerie Hickey and Habiba Gitay
At the 12th Conference of the Parties to the Convention on Biological Diversity happening right now in Korea, there has been a lot of talk about adaptation. Most importantly, how can nature help countries and communities adapt to climate change?
Philippe Desfossés is the CEO of ERAFP, the French Public Service Additional Pension Scheme. He spoke about carbon pricing from an investor's perspective.
“I support putting a price on carbon because it fixes a market failure. Without carbon pricing, the market has no way to address the costs associated carbon emissions. These costs end up being borne by everyone, including companies and societies.
Sitting on the train heading back from New York to Washington D.C., gazing out of the window at stressed watersheds, I had some time to reflect on a very special Climate Week. What does it all add up to? Where does it leave us as a global community needing speed and scale in our climate action?
Much is being written. Let me add a perspective. Here are three thoughts amid my swirl of memories, moments and impressions.
Climate osmosis – the street reaches the hallowed halls
It was difficult to stand in the canyon that is 6th Avenue, with a sea of people stretching in both directions – environmental activists, nurses, pensioners, business people, every possible faith community, moms, a sprinkling of celebrity and a dash of statesmen – and not be moved. On the Sunday before the Summit, more than half a million people took to the streets in People’s Climate Marches in New York and more than 160 countries across the globe. The marchers demanded climate action from their leaders, suggesting that the politics of climate action, once considered too hard to handle, might no longer be as difficult as leaders think.
The reverberations continued for 48 hours and became a point of reference in almost every speech at the UN Secretary-General’s Climate Leadership Summit. More than 120 heads of state and government came to hint and in some cases pledge action on climate change. New coalitions of governments, businesses, investors, multilateral development banks and civil society groups announced plans to mobilize over $200 billion for low-carbon, climate-resilient development. Forests and cities were big winners, landing pledges of around $450 million for forests and bringing together more than 2,000 cities in a new Compact of Mayors to help improve accounting of urban greenhouse gas emissions and the actions cities are taking to reduce them.
Vikram Widge heads the World Bank Group’s Climate and Carbon Finance Unit. He spoke from the UN Climate Summit about the new Pilot Auction Facility for Methane and Climate Mitigation (PAF).
Q. U.S. Secretary of State John Kerry and the Swedish Energy Agency just pledged $15 million each for the design of a new facility called the Pilot Auction Facility for Methane and Climate Mitigation. What is the PAF?
The World Bank Group is designing a new climate finance pilot that will support emission reductions in developing countries. Because of limited public resources available for climate investment, this facility leverages private capital to support projects that reduce greenhouse gas emissions and are at risk of being decommissioned due to the low price for carbon credits today.
The facility tests an innovative contract structure by offering put options through an auction to guarantee a minimum price for carbon credits that a project will generate, which gives private-sector buyers, such as projects developers and intermediaries, the security of knowing that they will be paid for investments they make to lower emissions.