Monday, September 27, 2010

"Climatopolis" - we are not all doomed after all (or are we)

The new Matt Khan book is out. Climatopolis. I enjoyed his previous books on Green cities and the American Civil War.

It is always impressive when academics can publish well and also write accessible books for a general audience.

I can't provide a full review as I have not bought the book yet although there are a number of obvious questions. I agree that it is pretty much too late to stop significant climate change and that adaption will be crucial. Luckily for him and many Americans, the US will suffer a lot less than many countries. Those on subsistence wages and the poor in developing countries will find it harder to move anywhere - that is where the real suffering will take place.

Arguing that "economic development" will solve the problem misses the endogeneity issue. Environmental degradation will impact on growth making development even harder and the suffering all the greater.

You can read a Grist interview with Matt Khan HERE.

His new book, Climatopolis: How Our Cities Will Thrive in the Hotter Future, argues that while it's too late to avoid the major effects of global warming, that's OK because most people will simply move to places that are effectively adapting to the changes. And here we'd been so worried! Kahn, a University of Chicago graduate, takes the school's free-market tradition to an extreme, arguing that rational agents in a market economy will simply "vote with their feet" and make winners out of the cities that are most able to innovate and attract new residents. It's a provocative argument, to say the least.

This question gets to the heart of the issue:

Q. You seem to see this all as a market problem. To me, 10 million Bangladeshis who can't feed themselves anymore and are crossing the border into India where they're not wanted -- that's a humanitarian and political problem. How does an entrepreneur innovate for that?

A. In India, many households benefit from access to cheap labor. Migrants to India will move to those cities where they will have the greatest opportunities. One could imagine a win-win, where the growing Indian middle class is actually happy to see many of these Bangladeshis if they need help with household chores.

But I agree with your point that adaptation in the developing world is the trickiest. My magic bullet is economic development. The Nobel laureate Tom Schelling contrasts malaria in Singapore and Malaysia. These countries are very close and have the same geographic conditions. Yet one [Malaysia] has much more malaria than the other. Schelling argues that economic development helps to mitigate environmental challenges through things like better diets and better access to medical care.


Economist - special report on "Forests"

The always excellent economist has a great "special report" on forests. It is a fact filled and well written report.

The implications are serious and it is about time this was highlighted. The dynamic and feedback loops are crucial and deforestation is one reasons why climate change could speed up far beyond that by which we could do anything to further increases.

Think "tipping points". This is an impressively gloomy report and well timed.

What is interesting is the issue of paying forest owners not to deforest. Is this a good use of money? Should the West be paying developing countries not to deforest?

I have picked out just a few of the more choice quotes to provide a taster.

Seeing the wood [Economist]

This is the latest reason—and it is a big one—why destroying forests is a bad idea. Roughly half the dry weight of a tree is made up of stored carbon, most of which is released when the tree rots or is burned. For at least the past 10,000 years man has been contributing to this process by hacking and burning forests to make way for agriculture. About half the Earth’s original forest area has been cleared. Until the 1960s, by one estimate, changes in land use, which mostly means deforestation, accounted for most historic man-made emissions. And its contribution to emissions is still large: say 15-17% of the total, more than the share of all the world’s ships, cars, trains and planes.

Stopping deforestation would appear easier that weening us off oil and cars.

The outlook for the Amazon is also grave. Recent modelling suggests that the mutually reinforcing effects of increasing temperatures and aridity, forest fires and deforestation could bring the rainforest far closer than previously thought to “tipping points” at which it becomes ecologically unviable. So far 18% of the rainforest has been cleared. The loss of another 2%, according to a World Bank study last year, could start to trigger dieback in the forest’s relatively dry southern and south-eastern parts. A global temperature increase of 3.5%, comfortably within the current range of estimates for the end of this century, would put paid to half the rainforest. This would release much of the 50 gigatonnes of carbon it is estimated to contain—equivalent to ten years of global emissions from burning fossil fuels.

Only 2% to go until we reach the point of no return. We may get there a lot sooner that you think and then it will be too late.
The Earth’s need for forests to soak up carbon emissions is almost limitless. Saving the forest that is left should therefore be considered a modest aim. But even that will require huge improvements in forest management, such as reforming land registries and tightening up law enforcement. Above all, it will require governments to prize forest very much more highly than they do now. Otherwise there will be no chance of the many reforms required outside the forestry sector: in land-use planning and rural development, in agriculture, energy and infrastructure policies, and much else. It will also require politicians to get serious about climate change. All that amounts to a revolution, which is a lot to hope for. But if anything can help bring it about, forests might.

They are crucial in all sorts of ways because of the manifold services they provide. Western taxpayers need the Amazon rainforest to control their climate. Brazil needs it to help feed its rivers and generate hydro-power. Amazonian soya farmers need it to guarantee them decent rainfall. Yet policies at every level conspire to wreak its destruction. Changing them, in Brazil and across the tropical world, is a daunting task. But it is not impossible—and it must be done. The cost of failure would simply be too great.


China seeks binding deal "with principles"

China was unhappy with the post-Copenhagen reviews some of which squarely blamed China for the failure to come up with a deal that could be considered anywhere close to a "good deal for the climate".

China will not attempt to take the moral high ground and to put the pressure back on the US. My understanding is that China does accept its obligations and is making considerable progress to reduce per-capita emissions even in the face of continued economic growth.

Of course China has a strong incentive with China likely to experience significant discomfort from climate change induced whether events and rising sea levels.

What is interesting is China is blaming US politics for the failure at Copenhagen. It is hard to argue against this claim. Obama is well meaning but will find it hard to fight against the lobbying powers of big industry in the US.

What is more interesting from this small news item is the following quote:

Li Gao, a senior Chinese negotiator on climate change, said his government would remain unyielding on issues of "principle" in the talks aimed at forging a successor to the Kyoto Protocol.

What this means is that China will require a deal along the lines of the 80:20 that has been previously mooted. The West reduces emissions by 80% and the developing world by 20%. After all, the vast majority of CO2 in the atmosphere was put there by us.

What does this posturing really mean? It means that chances of a deal are close to zero and our expectations for Cancun should be low. Mine never got off "low" before Copenhagen and are certainly no higher. Chinese "principles" are hard to change.

China Seeks Binding Climate Treaty Late 2011: Report [Planet Ark]
China wants the world to seal a binding climate change treaty by late 2011, a Chinese negotiator said in a newspaper on Friday, blaming U.S. politics for impeding talks and making a deal on global warming impossible this year.

Li Gao, a senior Chinese negotiator on climate change, said his government would remain unyielding on issues of "principle" in the talks aimed at forging a successor to the Kyoto Protocol. The first period of that key treaty on fighting global warming expires at the end of 2012.

Li also vowed to keep pressing rich countries to promise deeper cuts to carbon dioxide and other greenhouse gases from human activity that are stoking global warming, said the China Economic Times, which reported his comments.

Many governments and experts have already dismissed hopes for a full climate change treaty at the next major negotiation meeting, to be held in Cancun, Mexico at the end of this year.

Li underscored that gloom, but also said his government hoped Cancun could be a stepping stone to negotiations next year that will culminate in a meeting in South Africa in November.

"China hopes that based on the outcomes from Cancun, we'll be able to settle on a legally binding document at the meeting in South Africa," Li said, according to the Chinese-language newspaper.

"After the South Africa meeting, we'll move to concrete implementation."

Li oversees the international climate change negotiations office at China's National Development and Reform Commission, a sprawling agency that steers economy policy.

The deadline for a new binding global pact was originally set for late 2009, but a final round of negotiations in Copenhagen ended in acrimonious failure, with some Western politicians saying China was not willing to compromise.

China will be a crucial player in the follow-up talks.

With its 1.3 billion people, it is the world's biggest emitter of greenhouse gases from human activity, but is also a developing country with average emissions per capita well below those of wealthy economies.

The United States, European Union and other governments want China to take on stronger commitments to control and eventually cut its emissions.

But Li said it was U.S. political uncertainty that had stymied any hope of the Cancun meeting agreeing on a treaty to succeed Kyoto.

"The biggest obstacle comes from the United States," he said. "Without any (climate change) legislation, it can't possibly join in a legally binding international document."

The U.S. Senate has dropped efforts to put emissions curbs in an energy bill now focused on reforming offshore drilling.

Negotiators from nearly 200 nations are haggling over a complex draft accord on climate change, and a further round of talks at the northern Chinese port of Tianjin opens on October 4.

Li said Beijing would keep pressing for certain principles, including that developing countries like China should not shoulder the same absolute caps on emissions that rich countries must take on.


Friday, September 24, 2010

Is There a Green Paradox?

This is a good question. Can it really be the case that an increase in carbon taxes could lead to an increase in emissions? Theoretically this is possible.

What about in the real world? I can see the intuition. If I owned a dirty coal field and I could see that the world was turning green and that carbon taxes were likely to increase to such an extent that power stations would be forced to switch to natural gas then my incentive would be to get that coal out and sold as quick as possible.

I could then reinvest the profits in a wind farm somewhere to take advantage of the uneconomic subsidies and feed in tariffs that encourage me to build wind farms where there is very little wind.

A new paper Michael Hoel looks at this issue. One of his conclusions is:

If a sufficiently high carbon tax is introduced, emissions will for sure decline. The possibility of a green paradox is therefore not an argument against the use of a carbon tax, but rather an argument against setting the carbon tax too low.

Perhaps there is some hope. This is an interesting topic for debate.

It should be noted that Professor Peter Sinclair (University of Birmingham) published a paper on the "Green paradox" as early as 1992.

High Does Nothing and Rising Is Worse: Carbon Taxes Should Keep Declining to Cut Harmful Emissions

Peter J N Sinclair

The Manchester School of Economic & Social Studies, 1992, vol. 60, issue 1, pages 41-52

Abstract: It is often that greenhouse gas emissions should be curbed by taxes on activities that generate them. This paper continues the case for taxes on fossil fuels in the context of an infinite-horizon growth model. Under simple conditions, a constant tax rate on energy use is found to exert no real effect: energy taxes just squeeze rents and have no impact on the time-profile of extraction. Expectations of falling energy taxes are what is needed to reduce extraction rates and postpone such adverse consequences that carbon emissions induce.

Here is the new paper:

Is There a Green Paradox?

Michael Hoel
University of Oslo; CESifo (Center for Economic Studies and Ifo Institute for Economic Research)

September 20, 2010

CESifo Working Paper Series No. 3168

A sufficiently rapidly rising carbon tax may increase near-term emissions compared with the case of no carbon tax. Even so, such a carbon tax path may reduce total costs related to climate change, since the tax may reduce total carbon extraction. A government cannot commit to a specific carbon tax rate in the distant future. For reasonable assumptions about expectation formation, a higher present carbon tax will reduce near-term carbon emissions. Moreover, whatever the expectations about future tax rates are, near-term emissions will decline for a sufficiently high carbon tax. However, if the near-term tax rate for some reason is set below its optimal level, increased concern for the climate may change taxes in a manner that increases near-term emissions.

Keywords: climate change, exhaustible resources, green paradox, carbon tax

JEL Classifications: Q31, Q38, Q41, Q48, Q54, Q58
Working Paper Series

Thursday, September 23, 2010

Collapse - "the inevitable destruction of industrialised civilisation as we know it".

It is difficult for economists to resist documentaries about the collapse of industrial civilisation (as we know it).

As a blogger I am happy to fan the flames of publicity for this doomsday tale (even if it is the old "peak oil" doomsday tale).

DVD out soon apparently. To some, watching a man in a room for 82 minutes talking about "his apocalyptic vision of the future, spanning the crisis in economics, energy, environment and more" might appear to lack a certain something.

However, please note, it has (1) economics (2) environment (3) crisis.

What more could you want from a film?

Filmed in a room that looks like a bunker, Ruppert sits alone in a chair, chain-smoking cigarettes and waxing lyrical on his belief that the world is doomed and we must be prepared. With his practiced and commanding rhetorical style, he recounts his career and spells out the disaster he sees ahead with his unnervingly persuasive world-view. He spouts forth passionately over the issue of ‘peak oil’ the concern raised by scientists since the 1970s that the world will eventually run out of oil and that life will change beyond all recognition. Using news reports and data that’s available on the internet he applies a unique interpretation, portraying a future that resembles apocalyptic science fiction.


The Russians are coming - "why Kyoto is useless"

Alexander Bedritsky, the Russian advisor on climate change, has come out to state what everyone else is thinking, already knows but is afraid to say clearly.

The revelation is that Kyoto will have "virtually no" impact on slowing global warming without the US, China and other developed countries.

There is the argument that something HAS to be better than nothing (surely) but there is an element on truth to his words.

The issue is whether 28% of the world can actually so something or should be just all give up and go home (preferably to a house on the top of a hill).

It is interesting to note that it took an environmental disaster (the summer fires in Russia) for the Russian's famed climate scepticism to change.

Kremlin Adviser Says Kyoto Can't Stop Climate Change[Planet Ark]

The Kyoto Protocol will have virtually no impact on slowing global warming unless it expands to take in the United States, China and more developing countries, Russia's chief climate negotiator said on Wednesday.

Russia is the world's fourth largest emitter of carbon dioxide and a key player in United Nations talks about whether to extend Kyoto when its first phase lapses in 2013, or replace it with a wider treaty that brings in poorer nations.

President Dmitry Medvedev's top climate change adviser, Alexander Bedritsky, said Russia is demanding a new deal as the 40 industrialized nations bound by Kyoto represent only 28 percent of global emissions.

"28 percent of the world cannot change anything," Bedritsky told journalists on the sidelines of an Arctic forum in Moscow.

"Countries can work and fulfill their targets, but nothing will change. The burden on the climate will grow."

Instead, the next round of U.N. climate talks in Cancun, Mexico in December should develop a non-binding agreement between countries representing 81 percent of emissions agreed at a U.N. climate summit in Copenhagen last year, he said.

The Kyoto Protocol was agreed at a 1997 U.N. conference to reduce greenhouse gases emitted by developed countries by an average of 5.2 percent below 1990 levels during 2008-2012. A total of about 190 nations have ratified the pact.

"We want cooperation in the period after 2012 to be all inclusive," Bedritsky said. The United States, which refused to ratify Kyoto, agreed to the Copenhagen deal.

Bedritsky said no binding agreement would be signed at the conference in Cancun but that he expected progress toward a deal. At the top of Russia's list of demands is recognition for the role its vast forests play in absorbing carbon dioxide.

While many Western nations are struggling to meet their Kyoto obligations, in 2008 Russia was 33 percent below its Kyoto target of keeping emissions below 1990 levels, mostly due to the collapse of high-polluting Soviet industries after 1991.

Moscow plans to let emissions rise from current levels to between 15 and 25 percent bellow 1990 levels by 2020, Bedritsky said, despite pleas by many nations for a tougher goal.


Russia developed a reputation as a climate skeptic after several senior officials suggested global warming might help Russia by easing its harsh winters, with Prime Minister Vladimir Putin saying Russia could save money on fur coats.

But a deadly heat wave this summer broke all temperature records, killed dozens in wildfires and destroyed a quarter of Russia's grain crop, prompting Medvedev to publicly acknowledge that the country's climate was changing.

Bedritsky said Russia had decided the threats from global warming outweigh the potential benefits, which include saving on heating costs and increasing the amount of arable land.

"But this does not counterbalance the need to act to decrease the human burden on climate and the ecosystem, the need to adapt to the changes and the need to neutralize the dangerous consequences."

He said scientists cannot say unequivocally there is a direct link between climate change and the heat wave in Russia and the flooding in Pakistan, but that they are obvious changes. "But I think of course you can consider them as signs of changes," he added.


Malthus is back - in a petri dish

A new book on the evolution and future of mankind by "Lawrence Wood, Ph.D., a retired physicist" paints a grim picture. The original article is HERE. [From the inbox].

His breakthrough is to use a petri dish:

“Bacteria in a Petri dish will grow until they fill the dish, consume all the nutrients within it, and then die,” he says. “Earth is mankind’s Petri dish and we don’t really know how big it is. But we do know that it is finite and thus our population cannot grow indefinitely. Either we will control our population, or it will be controlled for us.” That latter scenario is one filled with mass starvation and violence as individuals and societies fight for their survival.

A cheery start to the day but there is more.

In his book, Wood details the cause of man’s exponential population growth. “Behavioral modifications were introduced by the process that caused evolution to occur early in the development of multi-celled life in order to ensure species survival,” he says. “These are the root cause of our propensity for excess population.” By their nature, he explains, these modifications cannot be de-selected or species survival would be imperiled

Wood, and many scientists, see population control as mankind’s only hope for survival. “It’s the elephant in the room,” he says. “We know Earth can not continue to sustain us. People discuss what to do about it, but are afraid to look at the only real answer, population control—family planning—because it is so controversial.” It is especially abhorrent to many religions.

The retired physicist dedicates much of his new book to a detailed explanation of evolution as well as an exploration of why humans first embraced creationism and then later intelligent design. He says he wrote his controversial book because he believes if people understand why we have the population explosion, we are more likely to take action to control it.

Just as evolution provided humans with the drive to reproduce, it also provided us with the cerebral cortex, enabling higher brain functions including reasoning. “Humans have the means for coping with the problem,” says Wood. “What is uncertain is whether we will use it. The fate of the human race is going to be determined by whether science wins, or superstition does.”

His conclusion could be considered in some quarters to be controversial - does science winning mean Malthus winning eventually?

The fate of the human race is going to be determined by whether science wins, or superstition does.


Wednesday, September 22, 2010

The UK's "Climate Change" department goes up in smoke

Is the department for climate change is about to become a victim of the fiscal cuts and be swallowed up by that venerable green department - the Treasury of Stern Review fame?

I particularly like Chris Huhnes argument that he worries his climate change department staff will "go native" if relocated to the treasury. It paints an interesting picture.

Does this mean the sandal wearing hippies in the climate change department will suddenly cut their hair and start wearing pin stripe suits and bowler hats?

Predictably the head of Greenpeace calls the proposal "sheer insanity".

Is this just another example of "green issues" being the first to go when real economic pain kicks in? Is climate change concern a luxury good?

Chris Huhne fights Treasury to save his climate department [Guardian]

Climate change secretary Chris Huhne is fighting to defend his department's funding and independence, fending off a suggestion that his civil servants should be moved to the Treasury to cut costs.

Huhne is having to resist the Treasury on numerous policy fronts. He has rejected the relocation idea, fearing his department's civil servants would "go native" if they moved into offices in the Treasury.

The Department of Energy and Climate Change (Decc) was created in 2008 by combining responsibilities which had been part of the previous business and environment departments. The move was praised at the time as an attempt to connect two areas of policy that had sometimes acted in competition.

But when all government departments were asked to model the effect of 40% cuts over the summer, officials at Decc told ministers that cuts of that level to its £3.2bn budget would make it unable to stand alone as a viable entity. At that time it was suggested it merge with the business department, but that was never formally suggested to the Treasury. Instead the Treasury renewed a push to get Decc relocated.

Decc and the Treasury would not be the only ministries sharing. The permanent secretary at the department for culture, media and sport is making plans to move in to the department for international development.

The news came today as Huhne gave his speech to the Liberal Democrat conference. His pitch was that the government wanted to foster a "third industrial revolution" in low-carbon technology. But the techno-optimism of the speech sat awkwardly with the news that he has been forced to contemplate breaking up his department.

Observers are concerned about the relationship between Decc and the Treasury in the run-up to the forthcoming spending review, which will decide all departments' funding for the next five years.

Within a reduced budget, the climate change secretary is pushing to secure money for a green investment bank and the four carbon capture and storage (CCS) demonstrations to pioneer cleaner coal power stations, brought in by the former climate change secretary, Ed Miliband. Senior civil servants at Decc say the Treasury does not want to provide the upfront costs of the demonstrations, known as CCS4. Senior sources concede the money for CCS4 was in jeopardy but insist that it is now safe.

The bank is a coalition pledge to create an institution supporting the development of low-carbon technologies. Huhne is in negotiations with the economic secretary to the Treasury, Justine Greening, and business secretary, Vince Cable, and their officials over whether the bank would be able to lend money – which Huhne believes to be vital – and the level of public money the Treasury will put into it.


The coalition has stated it will be the "greenest government in history", and Huhne has told MPs that the department is fostering a "third industrial revolution".


John Sauven the head of Greenpeace called the proposal "sheer insanity". "I think it would now be inconceivable for the government to back down after promising so much only a couple of months ago."


Are volcanoes the answer to our energy problems?

Volcanoes are hot - an obvious place to start when thinking about how to solve the world's energy problems.

I am currently working on issues related to hydro power - volcanoes could make a useful addition. Geothermal has massive potential to supply our energy needs.

With improvements in technology geothermal and great potential (and it is a relatively green source of energy).

The problems with hydroelectric are well documented but there is a nice summary in this article.

Hydroelectricity depends on rainfall and is vulnerable to hurricanes that can wash mud and debris into rivers and clog dams. Such storms are expected to increase in the frequency and intensity as the planet warms.

"With climate change there's uncertainty over the future behavior of water resources," said Eduardo Noboa, a renewables expert at the Latin American Energy Organization, or OLADE. "We're going to see a vulnerability in hydroelectric systems."

Dams, which can flood vast areas of land during their construction, are unpopular in rural areas where families rely on farming and have trouble finding arable land.

In Guatemala, hydroelectric projects have a haunted past after hundreds of Mayan villagers protesting the building of a dam on the Chixoy river were massacred by security forces in 1978 at the height of the country's civil war.

The dam and its reservoir, which now generates around 15 percent of Guatemala's electricity, displaced thousands of people in the country's central highlands.

The question then is why the World Bank are so keen to push for additional hydroelectric power in Africa?

Watch this space.

Central America Taps Volcanoes For Electricity [planetark]
Dotted with active volcanoes, Central America is seeking to tap its unique geography to produce green energy and cut dependence on oil imports as demand for electricity outstrips supply.

Sitting above shifting tectonic plates in the Pacific basin known to cause earthquakes and volcanic eruptions, the region has huge potential for geothermal power generated by heat stored deep in the earth.

Geothermal power plants, while expensive to build, can provide a long-term, reliable source of electricity and are considered more environmentally friendly than large hydroelectric dams that can alter a country's topography.

Guatemala, Central America's biggest country, aims to produces 60 percent of its energy from geothermal and hydroelectric power by 2022.

The government is offering tax breaks on equipment to set up geothermal plants and electricity regulators are requiring distributors buy greater proportions of clean energy.

Some 1,640 feet below the summit of Guatemala's active Pacaya volcano, which exploded in May, pipes carrying steam and water at 347 degrees Fahrenheit (175 degrees Celsius) snake across the mountainside to one of two geothermal plants currently operating in the country.


Run by Israeli-owned Ormat Technologies Inc, the plant harnesses energy from water heated by chambers filled with molten rock deep beneath the ground.

The company has been operating two plants in Guatemala for three years and wants to expand but is weighing the risks of drilling more costly exploratory wells.

"There's a phase where you just have to drill and see," Ormat's representative in Guatemala, Yossi Shilon, told Reuters. "The problem is that you risk a very expensive investment and are not always satisfied with the results."

Ormat's project is only a 20 MW station but Guatemala says the country has the potential to produce up to 1000 MW of geothermal energy, a third of projected energy needs in 2022.

Other Central American countries are already forging ahead in this emerging technology.

More than a fifth of El Salvador's energy needs come from two geothermal plants with installed capacity of 160 MW and investigations are being carried out to build a third.

Costa Rica, which has 152 megawatts of capacity in four geothermal plants, is due to bring a fifth plant online in January 2011 and is looking into building two more.

Nicaragua generates 66 MW from geothermal energy and in the next five years plans an increase to 166 MW.

Guatemala only produces a tiny amount of its own oil and spends about $2 billion a year on imports. The aim is to save money on energy costs and join international efforts to cut green house gas emissions, issues that will be on the table at global climate change talks this November in Cancun, Mexico.


Central America, heavily dependent on agriculture, is feeling the effects of extreme weather. Tropical Storm Agatha killed nearly 200 people in the region earlier this year.

The largely poor countries are highly reliant on hydroelectricity, the number two source of energy after oil, but environmental activists and energy experts say harnessing geothermal energy has distinct advantages over dams.

Hydroelectricity depends on rainfall and is vulnerable to hurricanes that can wash mud and debris into rivers and clog dams. Such storms are expected to increase in the frequency and intensity as the planet warms.

"With climate change there's uncertainty over the future behavior of water resources," said Eduardo Noboa, a renewables expert at the Latin American Energy Organization, or OLADE. "We're going to see a vulnerability in hydroelectric systems."

Dams, which can flood vast areas of land during their construction, are unpopular in rural areas where families rely on farming and have trouble finding arable land.

In Guatemala, hydroelectric projects have a haunted past after hundreds of Mayan villagers protesting the building of a dam on the Chixoy river were massacred by security forces in 1978 at the height of the country's civil war.

The dam and its reservoir, which now generates around 15 percent of Guatemala's electricity, displaced thousands of people in the country's central highlands.

Geothermal plants by contrast are compact and companies, learning from the mistakes of the past, say they are making an effort to provide nearby towns with easy power access.

Monday, September 06, 2010

How to track "climate finance pledges" - who are the laggards?

The WRI have an excellent new website that allows the reader to check on how much each developed country is coughing up to fight climate change.

The last update is 12th August 2010.

The numbers are a little higher than I expected actually with $28 billion already pledged.

Any questions you might have are addressed at the website.

Japan and the EU are leading the way - Japan has currently pledged around 5 times as much as the US ($3,029million) with the UK just a little behind ($2,800 million).

Interesting numbers.

Summary of Developed Country ‘Fast-Start’ Climate Finance Pledges [WRI]
The Copenhagen Accord commits developed countries to collectively provide resources “approaching USD 30 billion for the period 2010 - 2012” to support developing countries’ climate efforts. This so-called “fast-start” finance will help developing countries, particularly the poorest and most vulnerable, mitigate (reduce) their greenhouse gas emissions, and adapt and cope with the effects of climate change. These pledges also present an opportunity to build trust between developed and developing countries in the international climate arena, in turn fostering progress towards a comprehensive post-2012 international climate agreement.

WRI has carried out a preliminary analysis based on available information on countries’ immediate pledges announced thus far. The accompanying table sets out both the amounts and the mechanisms by which funding would be delivered. WRI has also looked at whether these pledges will provide “new and additional” funds compared to what developed countries already provide through official development assistance.

This table will be continuously updated as more information becomes available.


Equity in Climate Change

The stumbling block to progress on climate changes hinges on different countries with different perceptions of what is fair. It is all about "equity" and "justice" - terms economists often struggle with.

I believe the developing world will settle for the 80/20 split on who pays - the developed world paying the lions share.

The US is unlikely to play ball.

The following paper provides an analytical approach

Equity in Climate Change: An Analytical Review [PDF]
Aaditya Mattoo
Arvind Subramanian


How global emissions reduction targets can be achieved equitably is a key issue in climate change discussions. This paper presents an analytical framework to encompass contributions to the literature on equity in climate change, and highlights the consequences—in terms of future emissions allocations—of different
approaches to equity. Progressive cuts relative to historic levels—for example, 80 percent by industrial countries and 20 percent by developing countries—in effect accord primacy to adjustment costs and favor large current emitters such as the United States, Canada, Australia, oil exporters, and China. In contrast, principles of equal per capita emissions, historic responsibility, and ability to pay
favor some large and poor developing countries such as India, Indonesia, and the Philippines, but hurt industrial countries as well as many other developing countries. The principle of preserving future development opportunities has
the appeal that it does not constrain developing countries in the future by a problem that they did not largely cause in the past, but it shifts the burden of meeting climate change goals entirely to industrial countries. Given the
strong conflicts of interest in defining equity in emission allocations, it may be desirable to shift the emphasis of international cooperation toward generating a low-carbon technology revolution. Equity considerations would then play a role not in allocating a shrinking emissions pie but in informing the relative contributions of countries to generating such a pie-enlarging revolution.


Progress on a "green fund"

One "climate change" solution is the creation of a "green fund". There is some progress and this should be seen as low hanging fruit.

The following quote sums up my view on this issue.

Connie Hedegaard, the European Union's climate commissioner, said that there was "some convergence" on the Green Fund but little sign of movement on underlying issues from China and the United States, the top greenhouse gas emitters.

Progress Seen On "Green Fund" For Climate Deal

Almost 50 nations made progress on Friday toward a "Green Fund" to help poor countries fight global warming but hosts Mexico and Switzerland said a full U.N. climate treaty was out of reach for 2010.

Environment ministers and senior officials meeting in Geneva also examined how to raise a promised $100 billion a year in climate aid from 2020 -- perhaps from carbon markets, higher plane fares or taxes on shipping -- to be managed by the Fund.


Mexico will host an annual U.N. climate meeting in Cancun from November 29-December 10. A Green Fund is meant to help poor nations shift from fossil fuels and cope with projected floods, droughts, mudslides and rising seas caused by climate change.


"We created a lot of expectations in Copenhagen that we would get a comprehensive, legally binding solution. We are no longer fixated on that," Swiss Environment Minister Moritz Leuenberger told a news conference with co-host Espinosa.


Espinosa said a Green Fund would only be agreed as part of a broad package in Cancun, including ways to share clean-energy technologies or protect carbon-absorbing forests. She said all elements of the package had to be agreed, or none.

U.S. climate envoy Todd Stern told a news conference that the meeting had been "pretty constructive."

"The biggest issue is...this has to be part of a package. We are not going to move on the Green Fund, and the $100 billion, if issues central to the Copenhagen Accord, including mitigation and transparency, don't also move," he said.

Stern also reiterated that President Barack Obama was committed to cutting U.S. greenhouse gas emissions by 2020 even though the Senate has failed to pass legislation. The United States is the only major developed nation with no legal cap.

Connie Hedegaard, the European Union's climate commissioner, said that there was "some convergence" on the Green Fund but little sign of movement on underlying issues from China and the United States, the top greenhouse gas emitters.

"We've seen nothing new coming out of the U.S., nothing new coming out of China. So we have to be very practical," she said of a focus on steps that fall short of a treaty.

Earlier, the Netherlands launched a U.N.-backed website ( to try to track how far rich nations, struggling with austerity, are able to keep a pledge made in Copenhagen to give poor nations $30 billion in "new and additional" climate aid from 2010-12.

Christiana Figueres, the U.N.'s climate chief, said the cash was a "golden key" to convince poor nations that the rich were serious in taking the lead to curb global warming. Under the Copenhagen Accord, flows would surge to $100 billion a year from 2020.

So far, the website lists cash promises by 6 European donors including Germany and Britain and 27 recipients from Bangladesh to the Marshall Islands. Stern said Washington would submit U.S. data in coming weeks.

Many of the developing nations' sites, listing cash received, are blank.