Henry Sichel, Angela de Michele

Environment and development

Wirtschaftuniversitaet - Wien

• Binding international limits;

• Carbon market;

• Encouraged national strategies

• + 25% CO2

• Only 2.5 bll/$ invested in climate projects • No real cooperation among countries

«We should reconsider trajectories of industrialization and unravel the ties that bound development to carbon»

• Equity; • Climate; • Social/economic development

open issues Trade off? Blocks

Per capita / Historical emissions’ paths

The solution: global collective action (North AND South)

«Developed countries disproportionately

occupy the «available space»»

For 20 years climate change has been an

environmental problem

Hybrid approaches

Right to develop, not to emit

responsibility

capacity

Sustainable development policy

Low carbon trajectories in the

South

Absolute reduction in the North

• «Newly industrializing countries are already large emitters and will increase in the future»

North

• Absolute reductions could lock inequality in perpetuity;

• Developed world increased its emissions while on the developing countries were doing the same

South

Early North’s action

Equity

Pluralism

To make South believe that we are not

displacing responsibility onto them:

… hypotetical band of long-term per

capita emissions?

Opportunities

• Ozone

• Acid rains

• Institutions

• Markets

• technologies

Built on the assumption of

costless carbon…

Now implies adjustment costs

Not that easy

issue…!

These opportunities are not matched by concrete actions up to now

Free-riding behaviours

Burden sharing in public

Exploitation of opportunities in private

Costituencies in a low-carbon future

Process of experimentation Pull-effect

…but to start is important!

< 2 C° - 50% Global

goal Useful for

commitment

Implications for developing countries

(implicit cap)

Development is a process of change, driven from below

Path-dependence = common patterns not so useful

This applies also to developed countries

Development lens

Institutional inertia

Formal rules of the game

Informal norms

can shape

Economic incentives

Institutional transformation

Technological innovations

Low-carbon development

Long-term process

No targets and

timetables

We should internalize the object in the

development process

burocracy

companies

civil society

citizens

• Implementation with minimal adjustments

Short-term policies

• Development through climate lenses

Long-term processes

No top – down planning

No prediction

North

South

Short-term

+ Long-term

• Prioritize predictability

• Setting of objectives for 2020 – 2030

• To provide the track

• Enjoy the «best practices»

• Energy saving (e.g.)

How much?

How to control?

How to monitor?

North South financing

North

South

Points of view

Responsibility

• North is more responsible, but it is politically difficult to lend money without control

Conditionality

• Bypassing democracy to enhance hard reforms = loans for «ownership» of projects

• Set a target to climate mitigation or adaptation

• Limit role for public funds, encouraging market mechanisms

• «we should be paid to help us solving a problem we didn’t contribute to create»

From

Implementing actions determined by donors

To

Organizing funds around a process to encourage the recipient-country

to develop its own agenda

Low-carbon development

Mitigation actions (e.g. energy saving)

The best hypotesis: different mitigation tracks

Developed countries

Fixed emission targets

Certainty Flexibility

Developing countries

Policy based actions, centered on activities instead of emissions

Policy spillovers: e.g., increase in energy

affordability

The best hypotesis

Adaptation assistence plan

Cross-cutting to disseminate technologies

Accountability measures

«Efficiency losses can be a reasonable trade-off to achieve

participation»

Many developing countries

Developing policies

Which indirectly undertake the purpose of emissions’ reductions

Developing countries can contribute in a consistent way through their development objectives

Policies and plans tailored on internal facts and needs

Multiplier of effects coming from the support of developed countries

Not binding targets

Processes

Legal character

Links to provide incentives

Accountability standards

I

The importance of emphasizing our

policies and make them accepted

Is this embedded in the process?

Or an outcome of the process itself?

Indeed, this could reduce every barrier in

negotiation between North and South

Tool-box of proposed policies for developing

countries…

…with simulations of impact

Bali Action Plan

«Nationally appropriate mitigation

COMMITMENTS or actions»

«Nationally appropriate mitigation

actions»

Developing countries

Developed countries

•Actions

Flow of support

•A country may indicate it…

or • Initiate a

review by a third designed body

To evaluate the need of support

Robust EFFORTS can be obtained only with such international support

Bali: Measurable, Reportable, Verifiable

Now Only minimal

communications

Future Rigorous approach

What actions should be measured?

Who is performing verification?

What kind of metrics?

CAPACITY to implement: developing countries need international support

Support will require mechanisms to channel resources and leverage

private investments

1

2

Public finance

Now Pledging Unpredictable and inadequate funds

Future Loans/guarantees/access to

technologies and payment for intellectual property

In all new funds

Kyoto: CDM system, based on emission credits from individual projects, but by this way excluding many other effective strategies

• to enhance resilience;

• to discourage high-emission investments

I Supportive comprehensive

national adaptation strategies

NAPA

Long-term plans to set risks

Needed adaptation capacities

National policies

II

Exchanging best practices Guidance and help in accessing technologies

Support international/national/

regional systems

Regional centers of excellence

III Funds to help countries in implementing

high-priority projects

Donors

CDM

Taxes