Copenhagen Accord: Where do we stand on finance?
Submitted by Grant Boyle
The Copenhagen Accord coming out of COP 15 says funding will be provided to developing countries for emissions mitigation, reduction of deforestation, and adaptation. There is a collective commitment from developed countries "approaching" $30 billion for the period 2010-2012, "balanced between adaptation and mitigation," with adaptation funding being prioritized for the most vulnerable developing countries. The developed countries also committed to a goal of jointly mobilizing $100 billion annually by 2020.
The Accord does not set out how this financing will be raised, despite the range of proposals ( albeit contentious proposals) on the table going into the summit. See previous posting.
Concerning the first $30 billion by 2012, it looks like the plan is for developed country governments to make cash pledges. There was talk during the conference that the US would come up with $3.6 billion, the EU $10.6 billion and Japan, $11 billion.
Concerning the $100 billion by 2020, the Accord says that this funding will come from a "wide variety of sources, public and private, bilateral and multilateral, including alterative sources of finance". The Accord says that this funding should flow through the "Copenhagen Green Climate Fund" and that a "High Level Panel will be established under the guidance of and accountable to the Conference of the Parties to study the contribution of the potential sources of revenue, including alternative sources of finance, toward meeting this goal."
It will be interesting to see how this "Green Climate Fund" shapes up in 2010 and the findings of this "High Level Panel". Clearly, there is a tension between whether to promote private or public funding approaches. Given the scale of funding promised by 2020, most of this money will likely come from private sources, which will probably result in renewed interest in 2010 in reforming and scaling upthe Clean Development Mechanism (the CDM). The CDM and/or similar crediting schemes may act as an international offset system for emerging national and regional emissions trading regimes.