The Glasgow Climate Change Conference: What Next for Climate Finance? – Ruth Adler

The Glasgow outcome on climate finance reaffirms parties’ commitments to their obligations under the UN Framework Convention on Climate Change and the Paris Agreement, but greater ambition is required in order to achieve the goal of limiting the increase in global average temperature to 1.5°C.

Climate finance was a key focus at the 26th meeting of the Conference of Parties (COP26) to the United Nations Framework Convention on Climate Change (UNFCCC or ‘the Convention’), held in Glasgow in November 2021.  The key outcomes with respect to climate finance are found in the Glasgow Climate Pactand the COP decision on long-term climate finance, and summarised below. The Glasgow outcome on climate finance reaffirmed parties’ commitments to their obligations under the convention and the Paris Agreement.

The Glasgow Climate Pact noted ‘with concern’ the increasing needs of developing countries due to the impacts of climate change and higher levels of indebtedness as a result of the COVID-19 pandemic (para 23).  The Pact emphasised the need to ‘mobilize climate finance from all sources’ in order to achieve the goals of the Paris Agreement, including increasing support for developing countries beyond USD 100 billion per year (para 25).  It noted with ‘deep regret’ that the goal of developed country parties to mobilise jointly USD 100 billion per year by 2020 — which was agreed at COP11 in 2010 as part of the Cancún Agreements — had not been achieved (para 26).  The Pact also called on developed country parties to ‘fully deliver on the USD 100 billion goal urgently and through to 2025’ (para 27) and for multilateral development banks and other financial institutions to increase investments in climate action (para 28).  

The COP decision on long-term climate finance also noted with ‘serious concern’ the shortfall with respect to the USD 100 billion per year goal (para 4) and urged developed countries to continue to ‘scale up’ climate finance to achieve the goal (para 5).  Noting that some developed country parties had doubled the provision of finance for adaptation, the decision requested that other developed countries significantly increase their efforts in that area with the aim of achieving a balance in finance for mitigation and adaptation (para 9).  Parties also agreed to convene high-level ministerial dialogues on climate finance in 2022, 2024 and 2026 (para 20), and that continued discussions on long-term climate finance would conclude in 2027 (para 18).  In addition, developed countries, led by Canada and Germany, adopted guiding principles and a Climate Finance Delivery Plan to achieve the goal of mobilising USD 100 billion by 2025.  

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The Paris Agreement’s White Whale: the hunt for greater ambition on shipping emissions — Tess Van Geelen

The shipping industry is often described as the ‘backbone’ of the international trade system, accounting for up to 90% of the global trade in goods. Even after the emergence of relatively affordable and much faster air freight, shipping continues to dominate due to its high efficiency and lower cost. Shipping is also generally seen as a greener alternative to air freight. According to some studies, shipping produces up to 40 times less CO2 equivalent than air freight.

Still, the sheer size of the fleet means that shipping makes a significant contribution to climate change. Current estimates put that contribution at around 2 or 3% of total global anthropogenic emissions. Shipping also causes a variety of other types of environmental damage, including oil spills, ship strikes that kill or wound marine animals, underwater noise pollution, and the transport of invasive species between ports.

Studies project that the rate of growth in shipping is likely to overwhelm recent efforts aimed at curbing emissions from the sector. Some studies have projected a future increase in emissions from shipping of up to 250% by 2050.

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Emerging human rights norms on climate change displacement – Annika Reynolds

This article analyses emerging international human rights law jurisprudence on climate change displacement and the right to life, notably Ioane Teitiota v New Zealand. This case is the first time the Human Rights Committee has recognised climate change is a threat to the right to life, and thus that states may have non-refoulement obligations to ensure ‘climate change refugees’ are not returned to dangerous environmental conditions. This article will first critically analyse Ioane Teitiota v New Zealand, before discussing how these emerging human rights norms on climate change displacement are expanding state obligations to address climate change.

The South Pacific is at the forefront of climate change, often portrayed as a region drowning in rising seas. The IPCC reports that the mean sea level of the tropical South Pacific is rising faster than the global average, increasing the frequency of extreme weather events, salination of fresh water sources, and predictions of territory loss in the coming decades. These changes heighten food and water insecurity, contribute to higher disaster-related fatalities and damage, and increase migration and the risk of inter-communal violence.This emerging reality has been labelled by the Human Rights Council as a ‘pressing’ human rights threat, notably to the right to life with dignity. Indeed, in Ioane Teitiota v New Zealand, the Human Rights Committee accepted that climate change was a threat to life that would make countries like Kiribati ‘uninhabitable’ in the coming decades. But human rights – deemed inalienable and fundamental – exist in tension with another pillar of international law – state sovereignty.

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Climate change and international investment law – a dangerous mix? – Stephanie Triefus

International investment agreements are coming under increasing fire for the threat that they pose to the global phasing out of fossil fuel energy sources. Foreign investors can challenge state measures addressing climate change via investor-state dispute settlement, which can lead to huge compensation awards that may deter states from taking such action. This piece discusses how investment law can be problematic in regard to climate change measures and calls for states to acknowledge this threat as they move forward with reforms to the international investment law regime.

Recently, it was announced that German energy company RWE is suing the Netherlands for €1.4 billion in response to the country’s decision to phase out coal energy. The case was brought via the investor-state dispute settlement (ISDS) provisions of the Energy Charter Treaty (ECT), a 1994 multilateral treaty for energy industry cooperation across borders. ISDS is a dispute settlement mechanism through which foreign investors can bring claims directly against host states if investors consider that they have been treated unfairly. The ECT has come under fire in recent years for being a threat to state efforts to switch to renewable energies, because it enables fossil fuel companies to sue states that make regulatory changes aimed at reducing carbon emissions. It has been reported that suits under the ECT could cost taxpayers up to €1.3 trillion by 2050 and protect up to 216 Gt of carbon, which exceeds one-third of the global carbon budget that can be emitted if we are to keep global warming below 1.5 degrees by 2100.

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Climate Adaptation as an Opportunity for Coping, Transition, and Transformation – Hasanthi Tennakoon Kingsley

Introduction

The Intergovernmental Panel on Climate Change (IPCC) together with other experts agree that even small increases in warming yield significant repercussions in terms of climate impacts and the capacity of natural and human systems to adapt to that change. The findings of the IPCC’s Special Report on Global Warming of 1.5°C in 2018, present a stark reality, especially for those who are already vulnerable. As a result, there is now a greater urgency to pursue adaptation.  

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Human rights and climate change in the courts: An international trend – Tess Van Geelen

This is the second article in a two-part series examining the increasing recognition of the relationship between human rights and climate change in international and domestic law. The first part looked at a milestone legal action recently launched in Queensland, while this second part outlines the international context.

Last month the Environmental Defenders Office (EDO) launched a legal challenge against the Galilee Coal Project in Australia. The legal action was the first in an Australian court to spotlight the devastating impact of climate change on human rights. Internationally, however, the case joins an established and growing trend of public interest litigation before international and domestic courts.

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Human rights and climate change in the courts: An Australian first – Tess Van Geelen

For the very first time in Australia, a coal mine is being challenged in court on human rights grounds. The action is part of a growing global trend that we’ll look at in this two-part series. This first part will give an overview of the legal action, and the developments in domestic law that opened the door for this milestone case. The second part will look at the international context, providing an overview of key foreign cases, and recent developments in linking human rights and climate change at the international level.

Last month the Environmental Defenders Office (EDO) launched a legal challenge against the Galilee Coal Project proposed by Waratah Coal, which is owned by Clive Palmer. According to Waratah Coal, the project is expected to produce 40 million tons of thermal coal per annum — fully four times the production of the nearby Adani Carmichael Mine, which has attracted considerable opposition in Australia. The Galilee Coal Project would be one of Australia’s largest coal mines.

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A Tad on the Intersection between Climate Change and Free Trade Agreements – Dr Jadranka Petrovic

Climate change is considered to be one of the most serious (‘the most serious’?) of all the threats that our planet is facing currently.  Research shows that in its potential impact, climate change poses a graver problem than weapons of mass destruction, cyber war, terrorism, armed conflict and every other peril. One of the main reasons that climate change figures strongly is due to its interrelatedness with other problems, including the adverse effects of international trade on the environment. It has been argued that although beneficial and indispensable economically, trade can exacerbate pollution and other forms of environmental degradation, particularly carbon dioxide (CO₂) emissions.  An unprecedented expansion of international trade since the 1950s has significantly impacted upon the environment.  Trade is predicted to continue to be one of the major factors driving economic growth in the future.  In parallel, it is expected that carbon dioxide emissions will continue to accelerate with growth indefinitely and that the very fact of increased trade, in and of itself, will lead directly to more global greenhouse gas (GHG) emissions.  As free trade agreements (FTAs) are being increasingly negotiated throughout the world,[1]the questions of whether and how these agreements can be used to support a successful transition to a low emission and resilient economy is becoming more and more significant.  By considering the effects of climate change on the Great Barrier Reef in Australia as an example, this article pinpoints (albeit tangentially) some of the trade-climate-change-related concerns in the context of the recently signed Comprehensive and Progressive Agreement for the Transpacific Partnership (CPTPP).

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The Champagne Problems of the Paris Agreement – Josh Sheppard

 

Introduction

On 4 November 2016, the Paris Agreement came into force, just under a year after it was concluded and signed. Coming into force earlier than expected, the First Meeting of the Parties to the Paris Agreement (“CMA1”) has been hastily organised to coincide with the twenty-second session of the Conference of the Parties (“COP22”). This article will address two critical questions regarding CMA1 and COP22: what is left for discussion after last year’s historic result, and how will the earlier-than-expected CMA1 affect negotiations?

 

The Detail

Whereas the 21st Conference of the Parties (“COP21”) was primarily concerned with the broad mechanisms of international climate cooperation – limiting global warming to 2°C, with an aspirational limit of 1.5°C and mandating that greenhouse gas emissions peak by the second half of the 21st Century – COP22/CMA1 will focus on the practical details of how these mechanisms will work and goals achieved.

 

Nationally Determined Contributions 

Some of the key negotiations will centre around the Nationally Determined Contributions (“NDCs”), which outline each country’s intended emissions reductions. Successive NDCs must contain greater emissions reductions and must reflect each party’s “highest possible ambition”. Decisions are scheduled to be made about the features of NDCs, how NDCs can be communicated in ways that aid clarity, transparency, and understanding, and what guidance should be given regarding accounting for NDCs so that there is consistency between communication and implementation. The depth of what remains unknown surrounding the practical operation of the NDCs is evident through analysis of the different debates currently taking place, particularly regarding timing and accounting practices.

 

  1. Timing

NDCs are due every five years (Art. 4(9)), although the exact timeframe is to be determined by the Parties: Art. 4(10). India has suggested that developing countries should not have to submit NDCs every five years. This submission may fuel debate in respect of how far the principle of “common but differentiated responsibilities and respective capabilities” extends, especially given that the Agreement explicitly refers to a five-year timeframe.

 

  1. Accounting

Accounting rules for determining emissions reductions illustrate further contrasts in the approaches adopted between developed and developing country Parties. The power of such rules has been demonstrated by Australia, infamously taking advantage of a rule that allowed for the crediting of good past performance under the initial Kyoto Protocol period to meet its current 2020 target, despite emissions actually being projected to increase by the end of the target period.

 

Some countries are seeking to avoid a rigid accounting system, with China advancing the following proposal:

[D]eveloped country Parties should take the lead in applying the guidance for accounting” [while] developing country Parties should be allowed to choose … the sectors and gases covered in their NDCs and specific methodologies on accounting”.

 

Iran and India, too, stress the different responsibilities for developed and developing countries in communicating NDCs, both specifically suggesting that the latter should not have to report on land use.

 

Demonstrating these rules’ critical importance to an effective Paris Agreement, the United Nations Framework Convention on Climate Change (“UNFCCC”) has made several comments regarding the accounting practices employed by Parties in their intended NDCs. Inconsistent reporting on land use between parties and the failure to provide information on assumptions and methods used to account for those emissions are obstacles to evaluating the entire effect of the actions outlined in the NDCs. Meanwhile, Costa Rica (on behalf of a coalition of Latin American countries) and Japan have requested that NDCs more clearly outline which emissions reductions are unconditional and conditional. These concerns, along with the differing application of agreed accounting standards justified by “common but differentiated responsibilities and respective capabilities” may see confidence in the NDC system decline and the Agreement unravel, if left unaddressed.

 

The dilemmas posed by the unanticipated swiftness of the Paris Agreement

Entering into force faster than most commentators expected, the Paris Agreement’s swift adoption has also created a headache for administrators and diplomats. Those who have not yet ratified the Agreement are technically not allowed to participate in the Meeting. The Climate Institute have highlighted the importance of allowing those who have not yet ratified the Agreement to participate in these processes, especially as many of these countries may have legitimate reasons for not yet having ratified the Agreement. Meanwhile, guidance that is supposed to be provided by sub-committees and working groups to CMA1 remains unfinished, the process of creating such advice having only begun this year. Therefore, many of the decisions that CMA1 was scheduled to make under the decision of COP21 are not yet ready to be made.

 

The World Resources Institute points out that this ought to be easily resolved, as COP22 can simply adopt new timeframes that accord with the early entry into force of the Agreement. However, the Paris Agreement contains reference to decisions being made at its first meeting, including the determination of common timeframes for NDCs. As this is in the treaty text, it is more difficult to amend the requirement for decisions to be made.

 

The Climate Institute posits that COP22 must formally create a method by which these practicalities can continue to be discussed and determined until the end of 2018. The World Resources Institute suggests that one possible solution is the suspension of CMA1 until agreed, providing the example of COP6’s suspension for seven months after the Conference was first opened. This appears to be the most likely solution.

 

Conclusion 

COP22, as CMA1 or its potential starting point, is where the difficult work begins in ensuring that emissions are reduced in a manner consistent with the Paris Agreement. The early entry into force of the Paris Agreement has, perhaps ironically, made this difficult work all the more complicated. It will likely mean the delay of important decisions to allow for expert guidance, the opportunity for Parties to put their views, and ratification by most, if not all, Parties. To resolve these issues, countries will have to draw further on that same cooperative spirit that facilitated the swift and unanimous adoption of the Paris Agreement.

 

Josh Sheppard is Assistant Editor of the ILA Reporter.