Cancún climate talks: policy issues to watch

EDF’s experts have been closely tracking policy issues at the United Nations climate talks in Cancún, where representatives from nearly 200 countries have come together for two weeks for the annual meeting of Parties to the U.N. Framework Convention on Climate Change (UNFCCC).

In our opening statement and blog yesterday, we identified avoiding deforestation, increasing transparency and financing climate change mitigation activities as critical issues that the Cancun conference must address to move negotiations forward.

Our team has been following these policy issues and others, and below we highlight some background and recommendations for issues we expect will feature prominently in the negotiations. (Note: due to the nature and complexity of these policies, some of our explanations are more detailed than others.)

Cancún Conference of the Parties to the UNFCCC (COP-16)

Historically, the UNFCCC has served as the primary forum for developing consensus-based global agreements to address climate change.  Since last year’s meeting in Copenhagen, where countries fell short of agreeing to a comprehensive new treaty, the best way forward has not been clear.  Going into Cancún, there are encouraging signs that Parties are still invested in coming to an agreement within the U.N. process.

However, reaching consensus will take a long time, and, as Parties continue to work on this overall agreement in the UNFCCC forum, they fortunately are not waiting on an outcome from the U.N. before they start taking actions domestically.  Instead, a parallel process is emerging at countries’ national and sub-national levels, where countries and regions are developing their own paths forward to curbing climate change, including through bilateral and multilateral deals.

No binding treaty is expected to come out of Cancún, but countries can and should develop a work plan and timetable for the coming year leading up to 2011’s conference in South Africa and, if possible, agree on a balanced package of interim decisions in key areas.  Success in Cancún will be defined by enough continued momentum to both reenergize the U.N. negotiating process and put the world back on track to an eventual comprehensive approach to reducing global emissions and achieving climate safety.

Measurement, Reporting & Verification (MRV)

Transparency and accountability are critically important issues with respect to ensuring countries meet both their mitigation commitments and their financing commitments, and devising appropriate rules for measurement, reporting and verification (MRV) is a central issue on the table in Cancún.  Experience indicates that nations often are willing to agree to more comprehensive mutual inspection and verification systems on a bilateral basis than they will agree to in a multilateral context.  We look forward to nations launching a process in Cancún to develop an MRV framework in the UNFCCC, while at the same time advancing the MRV issues through bilateral and regional approaches as well.


Key finance issues on the table in Cancún include developing an institutional structure for the Green Fund and mustering the political will to ramp up long-term financial commitments.  It is clear from the U.N. Advisory Group on Finance report that getting to the pledged $100b-per-year funding for climate mitigation activities is possible, but doing so will require serious political will and economic incentives.

The most fundamental such incentive is a price on carbon of around $20-25 per ton of carbon dioxide emissions in key emitters by 2020. Strong policies such as energy efficiency standards are equally important to bend the greenhouse gas trajectory. Policy makers must step up to the plate now.

Direct public finance will be necessary to catalyze private finance. Regardless of the source, there must be transparency and accountability in how the funds are generated, allocated, and spent.  Ultimately the only truly scalable and sustainable source of finance is the private sector, yet governments must take the first step.

Parties also must come to an agreement on institutional structure, which must be transparent, accountable, and efficient, and a framework for action to establish it.

Avoiding Deforestation (REDD+)

Reducing emissions from deforestation and forest degradation (REDD+) is one of the policy areas in the UNFCCC negotiating texts with the least amount of language still is bracketed (meaning still under discussion), and is among the areas most likely to see progress in Cancún – if countries have the political will to do so.

As written, the REDD+ policy will be implemented in three stages; in Cancún, Parties should agree to a decision on the widely supported first two phases of REDD+, including REDD+ readiness (phase 1) and – if some issues are overcome – REDD+ implementation (phase 2).  REDD+’s 3rd phase, which includes more contentious issues like establishing a market for REDD+ credits and which allows “sub-national accounting”, can be finalized in next year’s meeting in South Africa.

A major consideration in developing REDD+ policies is the role of indigenous peoples, who are the best-suited to monitor and protect their land from deforestation.  Many indigenous peoples support REDD+ activities that protect their rights to their land and resources, and seek recognition of the principles from the United Nations Declaration on the Rights of Indigenous Peoples.  The indigenous peoples caucus in the UNFCCC also wants the funds generated from their conservation roles in REDD+ policies to be used to finance a development pathway that they control.

The REDD+ language under consideration could be improved if it strengthened protections for indigenous people, increased the role of stakeholders in negotiating processes, and provided greater clarity on technical issues, such as how a country can set up its baseline (initial level of emissions) and basic elements needed for its national action plan to implement REDD+.  However, if Parties in Cancún can agree on the first two phases of REDD+ and maintain or strengthen the policy’s current language, a strong REDD+ final package should be attainable next year in South Africa.

Land Use, Land-Use Change, and Forestry (LULUCF)

Accounting rules for Land Use, Land-Use Change and Forestry (LULUCF) activities should be decided before countries set their emissions reductions targets.  In Cancún, Parties have the opportunity to reach consensus on robust rules with strong environmental integrity that will enhance accuracy, comparability, completeness, consistency, and transparency in the accounting.

Parties need to take the important step of making accounting for forest management activities mandatory for all Parties.  The accounting rules for forest management should reward countries who put in place better management practices, and should penalize Parties who do not.  To achieve this, the process for constructing baselines needs to place stricter limitations on the policies and measures that may be included in the reference level by limiting them to 2005 at the latest.  A cut-off date of 2005 will allow Parties to properly reward additional activities undertaken since the Kyoto Protocol came into force and will prevent perverse incentives for recent and planned increases in emissions.  This step should be coupled with a stronger review process for the baselines, to make it more transparent, consistent, and accurate.

To increase transparency in the review process, party submissions and reviewers’ comments should be made available to stakeholders so that stakeholders are able to evaluate and respond.  To improve consistency, Parties should work to standardize their expectations about global factors that affect forest management decisions.  To improve accuracy, the teams who perform the reviews should be explicitly authorized to recommend potential solutions to any problems identified in the data and methodologies, in the same way review teams are currently enabled under the Kyoto Protocol.  These steps will help establish strong incentives for better forest management practices.

Beyond forests, Parties should also make progress toward expanding accounting to include more land management activities, such as cropland and wetland management.  One step in this direction would be to adopt a broader definition of “wetland management” – one that includes changes to hydrology, ecology, and water chemistry.  Including these land management activities in the accounting and defining “wetland management” will both make accounting for land use more accurate and provide incentives for better management of these.

Kyoto Protocol

Parties in Cancún should continue to strengthen and increase emissions reductions commitments in the Kyoto Protocol framework to establish a strong U.N. backbone for “bottom-up” regional and state-level actions and a robust carbon market.

While the first commitment period for the Kyoto Protocol is scheduled to end in 2012, the framework, including its mechanisms and accounting system, should continue to exist after 2012.  In the event that there is no second commitment period (2013-2020 or 2013-2018) agreed, national-level surplus carbon allowances that are in accordance with the Kyoto Protocol should remain valid after 2012, which will help meet expectations from countries when they enter an international agreement.  Even if no second period is agreed on, to prepare for future commitments Parties should agree to a decision that extends the functioning of the Kyoto Protocol’s Clean Development Mechanism and Joint Implementation mechanisms after 2013.

In the long term, if the Parties succeed in devising a comprehensive new agreement, key elements of the Kyoto Protocol architecture – including its accounting system, carbon market, and compliance regulations – should become part of any new global climate agreement.  In the transition to such a new agreement, the Kyoto Protocol can play an important role in areas such as strengthening commitments of Kyoto Protocol Parties and strengthening rules for forestry and land-use policy.

International Shipping & Aviation (Bunkers)

Parties in Cancún need to send a clear message that greenhouse gas emissions from international transport must be regulated immediately.  For nearly two decades, countries party to the International Maritime Organization (IMO) and the International Civil Aviation Organization (ICAO) — the U.N. agencies for international maritime shipping and aviation affairs — have made minimal progress in devising global, sectoral policies to regulate bunker fuels, the fuel that powers the engines in ships or aircraft.  To catalyze progress in these agencies, Parties in Cancún must reach a decision on bunker fuels that encourages IMO and ICAO to continue working toward global measures to reduce emissions from their respective sectors, while respecting the legal authority of regions and nations to regulate greenhouse gas emissions on their own.

This is part of a series from EDF’s experts, who are blogging regularly from the U.N. climate conference in Cancún on EDF’s Climate Talks blog.

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