Unpacking the climate negotiations at COP24 – week 1

10 Dec 2018

The Energy and Resources Institute is attending the 24th Conference of the Parties (COP 24) in Katowice, Poland from 2nd to 14th December 2018. This is a summary of developments over the course of week 1, and an analysis of what can be expected for week 2.

CoP 24

The task before the Parties attending the conference is to finalise the Paris Agreement's implementation arrangements and to look at the issue of countries' ambition in terms of level and scale of actions for addressing climate change that has been achieved so far. The modalities, procedures and guidelines for implementing the Paris Agreement - the so called Rulebook - are seen as the key deliverable at the COP 24 in Katowice.

The Paris Agreement was unique as it coherently brought together a comprehensive set of elements that make up climate politics: mitigation, adaptation, climate finance, transparency, loss and damage, capacity building, technology transfer mechanisms; and all these around the 3 pillars of self-determined ambition, flexibility and dynamism. It has since then almost been three years over the course of which parties to the United Nations Framework Convention on Climate Change (UNFCCC) have been trying to operationalise the agreement. Today, less than a week away from the deadline set by the international community to agree on a Rulebook for the Paris Agreement, views are still splintered. Parties are wondering how and why the spirit of the Paris Agreement that once helped unite all into crafting a unique pact is missing, and are trying to piece it all back together.

The divergent approach to the issues at stake was made evident in SBSTA's plenary on Saturday late afternoon where a decision was to be taken on the status of the scientific work accomplished under the Intergovernmental Panel on Climate Change Special Report on 1.5°C (SR1.5). It had been noted with hope by many since the start of the COP that, with the SR1.5 now in hand, the nature of conversations around the 1.5 target had changed and felt much more internalised, with many parties pointing to the lived realities of climate impacts in their own countries and some (Iran!) going as far as questioning whether the scientific approach was too conservative. While it was unclear how the SR1.5 would be incorporated in a COP 24 outcome, there seemed to be appetite for an outcome that would respond to the ambition gap and the emergency captured in the IPCC SR1.5 and the Synthesis Report of the Talanoa Dialogue. This explains the SBSTA Chair's dismay when on Saturday, the US, the Russian Federation, Saudi Arabia and Kuwait opposed "welcoming the report of the IPCC on 1.5°C" in the draft SBSTA conclusions which was strongly supported by a plethora of country groupings. As a result, consensus could not be achieved, and as per the UNFCCC rules, the matter had to be deferred to the next SBSTA meeting which will only be next year. This could potentially mean that we have a COP outcome at the end of next week that makes no mention of a report that the COP itself commissioned back in 2015. Everyone thought that getting the IPCC SR1.5 into the COP outcome would be the easy part.

In all fairness, the week actually started off energetically with Rulebook discussions progressing steadily, thanks to the effective use of a multi-layered approach, with negotiators elevating sticky issues to the head of delegation level for either technical solutions or tabling for political guidance in week 2. Informal sessions on finance (predictability of finance and the financing of the Adaptation Fund) were highly constructive. Even on issues around Article 9.5 on financial information to be provided by developed countries where the debate was intractable, there was some movement and a draft conclusion - though unsatisfactory on many counts - is on the table. The issue of flexibility in the transparency framework has also got some traction, and parties are now willing to settle with a definition of flexibility that may work. If we look at the streamlined draft conclusions that we have now as compared to the text we started with a week ago, substantial progress has been made. No agreements may have yet been reached; however, the options on the table are more clearly delineated, making the identification of landing zones easier.

Crunch issues

The crunch issues - which are now identifiable and not unexpected - will be elevated to the level of the 120+ ministers this week. These include the operationalisation of flexibility and differentiation, reporting on finance including the framing of the long-term post 2025 finance goal and its linkage with loss and damage in the Rule book, the start date of the enhanced transparency framework, the outcome of the Talanoa Dialogue, the nature of market mechanisms, and hopefully, the recognition of the IPCC SR1.5 will be added back to the agenda.

CoP24

The Transparency Framework talks had been smoother than in other streams till now, but this time a few sticky points emerged. Here, the negotiators are faced with the challenge of balancing the necessary flexibility which acknowledges the different capacity levels to operationalise transparency around the world - and its boundaries, if any - with a universal enhanced transparency framework that will build on existing standards. Developing country negotiators are also frustrated by what seems like an attempt from some countries of the Global North to dodge the enhanced part of the framework, as well as a lack of clarity on the future of Consultative Group of Experts, the body currently tasked with building capacity on transparency.

Climate finance has always been a stumbling block of the climate negotiations. The week started well with Germany for being a first mover on the replenishment process of the Green Climate Fund (GCF), and Russia announcing their plan to pledge to the GCF after they have sorted out the paper work. Encouragingly, last Sunday, the World Bank also announced a commitment to double its climate financing to USD 200 billion over 2021-2025. But what climate negotiators are worried about is the predictability of finance and the modalities to ensure that this happens. The Paris Agreement mandates developed countries to provide information on finance they will provide in the future, as this is important information to be considered by developing countries in their climate policy planning processes. There is discordance because developing country negotiators would like to simultaneously discuss what kind of information and how it will be communicated; while developed countries prefer to discuss only the "what" for now.

Another finance crunch issue that ministers will likely discuss up to the end is the long-term post 2025 finance goal. With predictability of finance in mind, developing countries would like to launch a process for determining the post 2025 goal now, while developed countries are emphatic this this is not an agenda item for COP 24 and have so far refused to discuss this further. It might be worth considering the customary UNFCCC move here consisting of planning to plan or committing to commit. This battle could be solved if all parties could commit to a date, be it 2019 or 2020, to start the process of defining the long-term goal, as this would instil the confidence required around the process for delivery of support.

For Parties that wish to use carbon markets to achieve their Nationally Determined Contributions (NDCs), Article 6 of the Paris Agreement will be an interesting battle ground this week as significant debates are taking place. While being highly technical, the discussion is also a crucial one to preserve environmental integrity of the emission reduction transfer systems, and to avoid double counting. Interestingly, countries' positions are quite different from what they usually are in other Articles of the Paris Agreement. Here, the issues are not related to differentiation but rather mitigation-centric. Emerging economies are pushing for no stringent criteria regarding environmental integrity, while the EU, EIG and AOSIS believe it is integral.

Finally, discussions on how the COP would consider loss and damage (L&D) did progress constructively in the beginning of the week. However, because of inability to identify clear landing points for developing country concerns over L&D, vulnerable countries started raising the issue across a majority of Rulebook agenda items. It can be expected that L&D will now escalate because of the imbroglio over the recognition of the IPCC SR1.5 in the draft SBSTA conclusions.

Expectations for week 2

What will happen now? Procedurally it is quite simple. After a week of technical discussions driven by negotiator dynamics, the draft SBSTA, SBI and APA conclusions were formally handed over to the COP Presidency on Saturday evening. They are now in the hands of the ministers during week 2 who are tasked with politically solving the above-mentioned crunch issues. It seems very likely though that the technical experts will have to continue working during week 2 facilitated by ministers, which proved to be a successful work method at COP 21. In addition, the four Presiding Officers have said that they would continue to produce a text under their authority for Tuesday night that would bring solutions to the remaining technical issues, leaving only the crunch of the crunch for ministers.

However, the question in everyone's minds is whether or not they will be able to deliver the comprehensive and ambitious package that the world is expecting from Katowice. With no mention of the IPCC SR1.5 in the draft conclusions and no certainty on the outcome of the Talanoa Dialogue that has stirred up much media scrutiny and anxiety in the climate world, expectations for an ambition outcome continue to grow. In fact, SBSTA's crisis-ridden plenary may indirectly help the ambition issue as it revealed that political space is sorely needed to discuss it; hopefully it will get elevated and managed politically this week.

Here are a few points to reflect on as the ministers work closely with the COP Presidency to secure outcomes by the close of COP:

  • While an outcome on the Paris Rulebook and a likely one on ambition are central to the success of this COP, they are not mutually exclusive but rather deeply connected. A strong Paris Rule Book is in fact the basis for enhanced NDC implementation and increased climate action and finance. How to get a strong Rule Book? It seems that succeeding in operationalising the right level and correct mix of flexibility across different streams of the Rulebook would be the underpinning element to avoid watering down the substance of other important elements of the Rulebook. How to get more ambition? Here, it seems that a Rulebook that preserves the nationally-determined nature of climate contributions would trigger ambition, in addition to operationalising the collective effort. As said by Ambassador Wael Aboulmagd of Egypt and Chair of the G77 + China Group: "This is not aid, this is a collective effort". To do that, it might be worth considering bringing in a reference to pre-2020 climate action as it would be of importance to BASIC and other developing countries that the pre-2020 action and financial support gaps become recognised as part of the overall gap. AOSIS, highly aligned with LMDC on this have in fact made it clear that delivery on any ambition gaps left in meeting 2020 targets would need to be monitored and assed in the post-2020 period - making the link to the Global Stocktake in 2023.
  • Alliances need to be rethought, starting here in Katowice. Indeed, alliances such as the High Ambition Coalition (HAC), AILAC, appear weak today. And while having a multitude of alliances operating with strong momentum leading up to and during COP 21 worked; a diversity of alliances in an uncertain political context may not help in delivering the successful outcome hoped for. Rethinking the lost progressive alliance into a new form of HAC, including India may be promising. India has indeed shown a great degree of constructiveness and openness in Katowice and elsewhere, making it clear that they are part of the global progress towards a cleaner world in the interest of stable and safe climate.
  • Regarding the COP outcomes, either in the form of decisions and/or declarations, it would be crucial that they explicitly engage and take non-party stakeholders forward with them, as does the Paris Agreement. Because ultimately it is the local authorities; the cities, the businesses, that will make the difference. This week saw the world's largest container shipping company AP Moller Maersk pledging to cut net carbon emissions to zero by 2050, challenging its suppliers to provide carbon free shipping technology by 2030. Volkswagen also announced that their 2026 generation of combustion engine cars will be their last. Croatia's state-run power utility HEP announced that it will invest $1.85bn in renewable energy by 2030, aiming to boost renewable energy to 50% of its total capacity. And in India, Dalmia Cement has pledged to become carbon negative by 2040. The draft conclusions as they currently are, dilute the participatory approach that was key to the Paris Agreement. The Rulebook should operationalise the non-party stakeholders' involvement in drafting NDCs and adaptation plans, in participating in the global stocktake as well as in the transparency framework.

Anyone sensible can understand that the best outcome for this COP is a strong Rulebook where different elements that compose the Paris Agreement are dealt with in a balanced manner. For the Rulebook to serve the global interest, it should operationalise the Paris Agreement for the long-haul rather than securing quick wins whose operational life would be short lived because of countries' inability to implement them.