An agreement has been signed. Climate change is happening. Now how are we going to pay for all the exciting mitigation and adaptation efforts? Here is a summary of some of the latest financial commitments made during the conference, according to UK international development think tank, The Overseas Development Institute (ODI).
The chart above shows a breakdown of the source of new commitments into three categories: private sector (banks and other corporations), energy innovation partnerships, and climate funds created by the United Nations Framework Convention on Climate Change (UNFCCC). Commitments by French banks to invest in green energy, green bonds, and low emission technology dwarf the other sources, reflecting the conclusion that the private sector will pick up a large portion of the climate finance tab. These efforts, which add up substantially over $100 billion before 2020 don’t include $140 billion worth of pledges from US companies such as Apple, Goldman Sachs, and Berkshire Hathaway, according to Bloomberg. While, less substantial the emergence of energy innovation partnerships, where countries like the US and Saudi Arabia join forces along with prominent philanthropists like Mark Zuckerberg, Bill Gates, and Richard Branson to support the development of clean energy technologies have gained momentum. Climate funds that enable developed countries to invest in green projects in less developed nations raised an additional $1.5 billion, according to ODI. These public commitments only reflect a small part of pledged support from developed governments. ODI estimates public finance from the developed world will contribute slightly under $20 billion per year by 2020.
The most impressive progress in terms of climate finance has been from major investment funds and asset managers. The Portfolio Decarbonisation Coalition and the Fossil Fuel Divestment Campaign, which together represent $4 trillion in assets, has committed to divest from carbon intensive investments, according to ODI. Additionally, 26 public and private finance institutions across the globe with $11 trillion in assets agreed to consider the impact of their investments on the climate through creating climate strategies, considering climate risk, and emissions, according to ODI.
At the singing of the Paris agreement at least $100 billion per year in climate finance has been secured from a variety of sources by 2020, with increasingly ambitious goals set for 2025. These pledges for climate investment are supported impressively by the commitment of trillions in institutional assets that will now consider the environmental impact of their investments.
Despite what you may think, we’re not discussing climate change over lunch with Obama while Narendra Modi cracks jokes about CO2 levels. In fact, the majority of the 40,000 people that have flocked to Paris for the COP will never even witness the negotiations between world leaders. Though this is obviously a crucial part of these next two weeks, the COP has much more to offer. Some may even argue that the most important work is being done outside the formal negotiation rooms. Read on for a day in the life of a student delegation.
According to the Merriam-Webster Dictionary, the term “sustainable” is defined as “of, relating to, or being a method of harvesting or using a resource so that the resource is not depleted or permanently damaged.” Thus, “sustainability” is commonly linked with the idea of leaving a better planet for future generations. However, in reality, defining “sustainability” is like nailing Jell-O to a wall- impossible and pretty pointless.
From a business perspective, carbon pricing at COP21 is arguably the most exciting news to emerge from the first few days of the conference. Day one of the United Nations Framework Convention on Climate Change in Paris included a high-level press conference which called on the world’s governments to begin proposing carbon prices as a policy tool to dramatically impact greenhouse gas emissions. The Carbon Pricing Panel, convened by the World Bank president and the managing director of the International Monetary Fund, simultaneously launched the Carbon Pricing Leadership Coalition, which comprises over 80 partners from all sectors, including governments, civil society actors, and private companies. The coalitions argue that a carbon price provides the best opportunity to successfully scale up renewable energy innovation and investment in clean technology, all the while continuing to push world economies forward. As World Bank President Jim Yong Kim states, “there has never been a global movement to put a price on carbon at this level and with this degree of unison.”
The United Nations Framework Convention on Climate Change (COP21) kicked off yesterday with a high-profile Leaders Events attended by close to 150 Heads of State. Unprepared for what the next 10 days would hold, Naomi and I searched aimlessly for the entrance to receive our UN accredited observation badges. It wasn’t until a swarm of people surrounded the incoming Al Gore that we realized we were in the right place. Less than five minutes upon entering the Le Bourget conference sight and we had already spotted the first high-level guest…this is going to be an exciting 10 days.
While we are apparently not high-profile enough to sit in on the Head of State opening statements, we quickly realized that almost everyone around you in the conference has just as much of an influence. We found ourselves having lunch next to what appeared to be an unassuming, random gentleman. It wasn’t until he was approached by four others, and then a Time Magazine and Fortune correspondent, that we learned we were in the presence of an expert on climate action in India.
The COP site is overwhelming. Exhaustively so. Our day began at 8am and ended at 9pm, with little downtime. The sheer amount of activity and energy is enough to keep you going for the entire day. The venue is sprawling, with events grouped by type spread throughout hangars. Beyond the formal negotiations, which begin Tuesday, there are countless side-events covering every range of climate related topics, ongoing exhibitions, press conferences, and more. We quickly learned that our pre-planned itineraries would be useless. There is simply too much to draw you in.
The beginning side-events focused on a number issues, with common key issues strewn throughout. While I remain hopefully optimistic about the outcomes of COP21, a few themes will arise as particularly contentious. Among them are:
Common but Differentiated Responsibility: The notion that all nations owe a common responsibility to address climate change, but a differentiated response based on how much they have contributed to the issue. Crucial to the negotiations will be to what degree developed nations contribute versus developing ones.
Climate Finance: Where will mitigation and adaption climate finance come from? Will it fall into the hands of the private sector, developed nations, or additional funding?
Loss + Damage: Developing nations will stress that they must be compensated or funded for the losses and damages that will occur due to climate related impacts. This idea goes beyond adaptation, in the sense that some amount of damage is bound to occur, and countries must have the funding available to respond.
Implementation: Much will come out of COP21. What will be crucial is how to focus on implementing the results, keeping countries accountable for their emissions and INDCs (Intended Nationally Determined Contributions), and perhaps most importantly, tackling these issues immediately, as opposed to waiting until the 2020 timeline.
While this is just a small list of the many issues that will arise, these ideas are sure to be key points of negotiation in the coming days. As the conference progresses, I’ll be here to provide coverage of specific side-events and developments within COP21.
On Wednesday, November 4th, the CoLA: Paris Is An Explanation class attended Emory’s annual Green Networking Night, an event that brings together sustainability professionals from a vast variety of fields, including wildlife conservation, engineering, marketing, policy advocacy, clean energy, and agriculture.