Climate conferences convened at the end of each year under the auspices of the United Nations never fail to be dramatic. The one that concluded in Katowice, Poland, last week, lived up to this expectation. First, there was a duel between the small island nations and oil exporting countries over acceptance of the recent 1.5-degree centigrate Special Report of the IPCC (intergovernmental panel on climate change). Many had pinned their hopes on this report emerging as the fulcrum of obligations for the next round of emission cuts under the Paris Agreement. This was not to be and the report could only be “noted”. Later, there were anxious moments when Brazil refused to relent on market mechanisms despite the concerted efforts of developed countries.
It was widely believed, before the commencement of the conference, that the absence of an agreement on climate finance would be a deal breaker. Africa and the small islands had pitched their hopes on such an agreement, in the beginning. However, weakened alliances and disagreements from within the G77 and China ensured that the conference extracted little more than platitudes on climate finance. Vulnerable countries had to remain content with mere reiteration of the international wish to mobilise support for such global needs. Not only was no roadmap adopted for the mobilisation of funds till 2020, no specific process has been initiated for fixing the long-term goals of finance by 2025, which is a legal mandate of the Paris Agreement. No clear guarantees could be obtained from the developed countries to even report their commitments through an international process.
However, the heart of the conference lay elsewhere. The most intense debates took place on devising Modalities, Procedures and Guidelines (MPGs) of the Transparency Framework, whose objective is to hold each country accountable for its promised actions. The Paris Agreement binds each country, irrespective of its status, in terms of development, to report and, inter alia, account for its emissions as part of Nationally Determined Contributions. It also mandates that MPGs for transparency be finalised early so as to track progress made by countries in achieving their targets or actions.
Considering the fact that global emissions are rising, and emerging countries are expected to contribute to emission reductions, the challenge for a country like India is to keep a healthy balance between national developmental needs and international obligations to account for the emissions. The Paris Agreement does assure flexibility to those developing countries that need it, according to their capacity. However, two decisions taken in Katowice would determine the extent of the flexibility available to India.
The first relates to the year when all countries have to begin furnishing their national inventory of emissions, and other actions, under the new arrangements. The year chosen at Katowice is 2024. India will need to have its emissions data of 2022 ready in 2024 to be able to report under the new arrangements.
The second, more important decision, relates to the retention of flexibility by developed countries in the accounting of their actions for international review. At Katowice, almost all developing countries argued for avoiding limitations on flexibility — needed by countries like India without a national inventory management system, which requires time to be built up.
While developing economies can use flexibility in applying the 2006 IPCC Guidelines for preparation of inventories as per their capacity, an obligation has also been placed on them to indicate a time schedule for exhausting these flexibilities. Moreover, adverse transparency findings can also result in the initiation of compliance proceedings against a country. Thankfully, a country’s consent will be necessary before triggering such proceedings. But it will not be long before developing countries are asked to cap and eliminate the flexibilities completely so that a unified order of climate review emerges.
In fact, that time is already set. There will be a global stock-take in 2023 of the first cycle of NDCs. The second global stock-take will follow in 2028. Developing countries should prepare themselves for this eventuality without further loss of time, so as to account for the NDCs and manage low-carbon growth sustainably.
Discussions on the use of market mechanisms for achieving NDCs almost broke the conference apart. The Paris Agreement allows two types of transactions in the climate markets — one at the economy level and the other at more specific sectoral/project levels. Most of the rich countries want the host countries to deduct the emission credits when transferred or sold to another country, from the inventory of emissions under their NDCs. On the other hand, developing countries believe that the job of the markets is to promote investments in environment-friendly technologies. The emission credits, when generated from specific policies and projects, should not be adjusted against the national inventory. The stalemate proved intractable and, eventually, the decision on both forms of market had to be deferred to the next climate conference.
Global Stock-Take (GST) in 2023 will determine the future of the global climate and the next round of obligations. It is here that the developing countries will have to defend the last vestiges of equity in climate. The language adopted at Katowice allows equity and the best available science to be the basis for post-GST actions; but leaves out specific differentiation amongst countries. For developing countries, defence of the principle of equity and common but differentiated responsibility in global actions, could have been the make-or-mar moment at Katowice, just as it was for Brazil in case of market mechanisms. As this could not be achieved, the notion of equity under the Rulebook is, at best, a notion of self-determination. It remains to be seen whether emerging economies accept a completely undifferentiated global climate order in 2023 or later.