Kari Kankaanpää
Posted by: Kari Kankaanpää

The two-week climate negotiations (COP 19/CMP9) ended in Warsaw with poor results on November 23. Many key issues to find a solution to the climate challenge are still pending. The outcome as such was not a surprise: it has already for a while been obvious that the UN driven process is struggling to deliver.

The conference was expected to result in a work programme for 2014-2015 to conclude a global climate agreement in COP21 in Paris in order to be in force 2020. Also it was supposed to decide on the level of emissions cuts, climate finance and a mechanism to help poor countries deal with loss and damage from global warming.

The ambition of the decisions was low. A new deal in 2015 would consist of what is called “intended nationally determined contributions” from both rich and poor nations. The conference created a Warsaw International Mechanism to help the poor countries to cope with loss and damage.

The only important outcome in Warsaw was an agreement on new rules to protect tropical forests and reduce emissions from deforestation and forest degradation (REDD+). Loss of forests accounts for nearly a fifth of global greenhouse gas emissions. Altogether euro 200 million was allocated to prevent forest loss and to increase carbon sinks.

UNFCCC not delivering

After years of efforts to establish a global climate deal it has become obvious that the UN process may not be the one to result in any significant progress and fast enough. National interests of states often overcome the joint good.

Striking in Warsaw were dichotomies: policymakers vs. business and developing countries vs. developed countries. When are we going to have a real cooperation between all – without the business solutions and capital there is no hope to solve the issue. Somebody in the business forum proposed to change “climate negotiations” to “climate collaborations”.

What could be the game changer?

Analysing the global emissions balance, one can conclude that the key players of the game are few: in terms of countries or companies. Instead of having to compromise between almost 200 countries worldwide, an essentially smaller group could work on a reasonable solution. Just to give two illustrations:

According to a recent analysis published in the journal Climatic Change, just 90 companies caused two-thirds of man-made cumulative global greenhouse gas emissions. The vast majority of the firms were in the business of producing oil, gas or coal. Nearly 30% of emissions were produced just by the top 20 companies.

Economic combinations of countries provide an alternative solution. The Major Economies Forum (MEF) including 17 major economies of the world and accounting for 85% of global emissions puts it in a ballpark. MEF is close to business and seems to be the US’ preferred forum as well. A China-US joint statement on climate change in April 2013 indicates the countries’ interest in action faster than what the UNFCCC can come up with. Another possible solution could be the G20 group.

A global carbon pricing and market would be the most cost-efficient tool to the decarbonisation of the economy. In Warsaw business forums market-based policy mechanisms were preferred and there seemed to be trust in their emergence. Already now in China about 250 million people are covered by the “small” ongoing emissions trading pilot schemes. Linking the existing and emerging trading schemes around the world could be the way forward in this field.

Business has the solutions

During the Warsaw talks there were several business forums discussing the solutions and help shape public policy.

Caring for Climate Business Forum on November 19 showcased the contributions that business and investors can make towards climate action while providing a high-level leadership platform with policymakers. There were several excellent presentations by BMW, Dow, Siemens etc. on their sustainable solutions and also on the expected changes in consumer behavior.

Several company presentations highlighted the role of global carbon pricing and market to foster innovations and investments. – Fortum joined the Caring for Climate Initiative last week and there are now almost 400 members.

Climate Action Business Forum on Wednesday, November 20 aimed to discuss the actions and solutions that are needed to increase sustainability and accelerate the global green economy. The forum focused on different partnerships around the world.

Many presentations concluded that technology is not a problem, solutions are there, the challenge is to magnify their deployment. For example, CCS is considered as a necessity and now there are only 25 installations globally whereas the volume should be 3000 by 2050. The estimated CO2 price to make CCS flying was considered as 70-120 €/ton.

The show goes on

The UN negotiations continue in 2014 and a high-level Climate Summit organised by UN Secretary-General Ban Ki-Moon is scheduled for September. Countries are expected to deliver their emission reduction pledges during Q1/2015, if they are able to do that.

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