Can developing nations get their money for nothing?
Guest Column by: Tamar Cerfici*
I’m back on US soil and watching the Copenhagen Climate Change Conference or more formally, the 15th Conference of the Parties (COP15) thanks to the wonders of modern video software.
My last column concerned the investment commitments expected from the developed countries, amounting to trillions of dollars. On the other hand, expectations are much lower for countries that don’t belong to the European Union or the Organization for Economic Cooperation and Development (OECD).
The canals in Copenhagen. Photo by: Tamar Cerafici. There’s a much prettier picture at Climate Central’s brand-new web site.
The International Energy Agency (IEA) expects that developed nations will provide more financial support to developing nations for emissions reduction. In fact, IEA’s low carbon revolution needs another major investment of $197 billion in 2020 in non-OECD countries.
There are two questions for Copenhagen delegates:
- How much carbon will I have to reduce?
- How much will it cost me?
There is a deep division at the COP about the fairness of carbon reduction goals. IEA and the UN’s International Panel on Climate Change (IPCC) suggest that most developed countries should reduce their carbon emissions by 25-40% below 1990 levels. These are really aggressive targets, and the developing nations would like to see these goals met.
Most developed countries balk at that, and have committed to much lower levels. Commitments range from 3% to 33% below 1990 levels, according to the latest study from the UN Environment Programme released Sunday.
Even this is a numbers game. The US commits to a 17% reduction from 2005 levels. Well, since it's 2005 levels were more than 15% above 1990 levels, The reduction really is a 3% reduction, and not much to get excited about.
The EU claims it will bring a 30% reduction to the table. However, the other developed nations have to play along, and promise to foot some of the bill for climate mitigation in developing countries.
Australia has some aggressive targets, too, with five conditions that must be met by other developed countries before they’ll commit.
All of the developed countries want the developing world to have a stake in the game, and some emerging economies are willing to reduce emissions by almost 20% from the current (or business as usual) emissions. If, of course, they get financial help from the developed countries.
Money for nothing?
The developing nations’ willingness to build a decent pact in Copenhagen rests on the developed countries’ willingness to help mitigate the cost of “clean” technology.
The idea of a “climate fund” has been on the table for some time, now. France has suggested that all financial transactions be taxed to help fund the program.
Bangladesh wants 15% of any climate fund that is negotiated into the treaty. More than 20 million Bangladeshis stand to lose their homes if the predicted climate disasters occur.
According to a report from Sunday’s Wall Street Journal, most developing countries want billions to combat the effects of climate change in their countries. On the other hand, oil rich nations like Nigeria want compensation for expected declines in oil use by industrialized nations.
Ecuador, which will assume presidency of the Organization of Petroleum Exporting Countries (OPEC), wins the prize for the most creative financing scheme: the rich countries pay Ecuador (and possibly all of OPEC) to keep the oil in the ground. Industrialized countries who start to slack off in their oil consumption pay Ecuador $3.5 billion to keep its oil in the ground.
Can’t we just get along?
The latest news from Copenhagen describes rift between small island nations and rapidly developing economies over an enforceable maximum temperature target in the agreement, claiming Kyoto wasn’t tough enough. These small island countries have the most to lose, like the Maldives and Tuvalu.
Now that the developing economies are going to have to shoulder some of the burden to reduce carbon emissions, they’re balking at the idea. China objected strenuously, noting that it was still developing its own carbon reduction strategies.
Kyoto doesn’t require developing countries to limit their carbon or contribute to global funding of climate mitigation. Some are looking to Copenhagen negotiations to change that lopsided equation.
China doesn’t think the developed economies are bringing enough to the table. Along with its 3% reduction promise, the US and EU delegations has offered a fast start fund of $10 billion a year to pay for climate change projects. That’s not enough, according to China and Brazil, the two largest emitters of greenhouse gases in the developing world.
The developing countries have accused the richer nations of shifting responsibility for carbon reductions on the poorer countries. The leader of the Sudanese Delegation notes “a huge gap in developed countries leadership in modifying their longer-term trends in anthropogenic emissions" as required by the convention.
Developing countries see themselves as “being required to take the leadership in cutting emissions while developed countries are continuously increasing their emissions and hence continuously over-occupying the global climate space."
Well, a whimper is better than nothing
Most delegates have given up the notion that a legally binding agreement can emerge from Copenhagen. Now they’re working toward a politically binding deal, outlining promised actions by each participating country.
The sad result is that the outdated clean development ad joint implementation mechanisms will remain in place, severely limiting the growth of nuclear energy in developing countries.
Carbon reduction and climate mitigation costs money. That’s in short supply, and the rich nations are still in shock from the financial collapse. Poorer countries expect assistance (not unreasonably).
Assistance can come in the form of reasonable and economic energy sources, including nuclear energy, whether from large baseload to smaller scale plants.
But it is all about the money. The great sage of the 20th century, Eric Idle, clarified the issue:
There is nothing quite as wonderful as money
There is nothing quite as beautiful as cash
Some people say it’s folly
But I’d rather have the lolly
With money you can make a splash
“The Money Programme” (1972)
Or how about “Dire Straits” Money for Nothing
* Author ID
Tamar Jergensen Cerafici, firstname.lastname@example.org
349 Shaker Road
Northfield NH 03276