ICW Daily - CSM@Bangkok - 8 Oct 2009

HEADLINE NEWS

Norway announces its unconditional 2020 target of 30% below 1990 levels, and conditional 40% target if major emitting economies meet some targets. Some reason for cheer in an otherwise lack-lustre setting.

All text is bracketed at this point – i.e., nothing is agreed until everything is agreed. But negotiators’ hands seem tied.

Technical progress = Yes. Political progress = No. Implies no emission reduction targets, no finance as yet.

Say ‘Ensure’ not ‘Promote’. This refers to environmental safeguards for REDD, but is relevant elsewhere too. Most countries concerned about conversion of natural forests to plantations and watered down text that can provide a loophole for that.

KEY ISSUES OF THE DAY

While it is abundantly clear that the outcomes of the G20 and UN Climate Summit did not translate into anything here, to have expected miracles out of Bangkok in the first place, may not be appropriate. Negotiators are trying to move things forward as they can, and many of them are batting for and sticking to the principles of the Convention. They have said it in as many words. Their hands are tied, and they need political mandates to put anything down on the table.

The nature of negotiations is such that delegates must go line by line and word by word, considering the implications of each phrase in the text. Informal contact groups have been initiated all this week, and drafting has been in progress. What has not been in progress is deleting text. That seems to be ‘hopefully’ left for Barcelona. While there is no rule saying negotiations must proceed as slowly as they are, given the political realities, all is left until Copenhagen (or a miracle before Barcelona).

In the contact group on REDD, a new non-paper is out, and includes comments on changes to governance structures and safeguards. In the discussions today, many Parties raised concerns about the text on REDD being rather watered down. They said there was nothing in the text to protect existing natural forests, and this would undermine the integrity of the work here. Parties also voiced their concerns over clauses indicating that ‘all stakeholders’ concerns’ must be voiced – would this include loggers too? There is concern that the introduction of such statements will encourage logging and deforestation activities in countries where there is a desire to discourage it.

Again, and as expected, nothing of substance happened in the Kyoto Protocol Targets discussions, except for new text from Australia that seems to weaken the provisions of the Protocol. Bolivia called for Annex 1 countries to cut their aggregate emissions by 49% below 1990 levels by 2017 – a five-year commitment period. UNFCCC compilations indicate that the 2012 target only looks like it will add up to much less than that.

On the discussion on mitigation action by developing counties, several countries asked for the deletion of paragraph 26 of the new non-paper, which makes mention of nuclear and large-scale hydroelectric as mitigation action. Canada, Argentina, India, Japan, the African group and Ethiopia all asked for the deletion of this paragraph, indicating that it clearly undermines the environmental integrity of the Convention. Countries expressed concerns over text that may attempt to set top-down policies for appropriate technologies. They indicated that while certain technologies might be good for some countries, they may not work for others, and hence need for policies and technology requirements to be country-driven.

In the contact group on mitigation actions by developed countries, Norway made its announcement to cut emissions by 30% below 1990 levels by 2020. This is an unconditional target, while the conditional one is of 40% if major emitting countries meet some targets. Norway’s announcement was welcomed with sustained applause, and the chair commented that this was the only news that had so far, received such applause. The Norwegian head of delegation explained to youth negotiator trackers later on, that Norway’s plans to encourage other countries to increase their level of ambition in the lead up to Barcelona and Copenhagen.

This was the only news in 1b (ii), since Parties already seemed to be in the return-home mode. There was silence all around, and the chair suggested that an informal meeting in a smaller contact group be scheduled immediately.

FOCUS ON THE GOI

On developing country mitigation action, India asked for the inclusion of ‘high-growth’ everywhere there was reference to ‘low-carbon’ or ‘low-emission’ in order to emphasise the need for rapid development. Indian negotiator, R.R. Rashmi indicated that text on market mechanisms did not belong in developing country mitigation action, since this was a way for developed countries to meet their targets, but was not in the interest of developing countries. On MRV, he said supported and unsupported actions must be dealt with separately.

On REDD, India said there is concern about the watered down nature of the text on environmental safeguards as well as social safeguards. Indicating that there is a need to send out a clear message to the outside world that the conservation of natural forests is an important issue. They also indicated that Sustainable Forest Management was not the same as Sustainable Management of Forests, and the need to distinguish between the two.

ICW Daily - CSM@Bangkok - 7 Oct 2009

HEADLINE NEWS

• Just two days to go to Barcelona. Big picture progress still missing.
• Is the Convention a Box, a Brick or a Tile? Well, if we sort that one out, then the deal is nearly done!
• In LULUCF some Parties are trying to create big loopholes, others say LULUCF needs to have a cap otherwise it can hijack environmental integrity.
• Finance makes little progress. Philippines on behalf of G77/China give impassioned statement. Bangladesh says need one single fund, single executive board and funding that is predictable, new additional, robust, at required scale, enables direct access
• In new market mechanisms EU, Republic of Korea, New Zealand propose differing versions of sectoral crediting and trading.
• Adaptation – Co-Chairs get mandate to produce new non-paper by Friday. Bhutan highlights extreme vulnerability of mountain communities.
• On response measures to climate change G77/China want insertion of term ‘sustainable development’ instead of ’low-emission economy’
• In KP track, discussion on text from Tuesday continues. China suggests text opposing unilateral measures against imports, draws ‘line in the sand’, says if no progress on LULUCF by Barcelona, this could be end of road.

KEY ISSUES OF THE DAY

Two days remain, and Parties look to make better progress than they made here in Barcelona. While that does not bode well for the pace of negotiations, it seems likely that the big decisions will be left for December.

In the heated discussion on KP emission targets and the inclusion of LULUCF, G77/China drew a line in the sand as far as LULUCF and its rules are concerned. They indicated that there had to be a cap on LULUCF, and that unless such a cap was put in place, their participation in Barcelona would be in question.

In the KP track on Potential Consequences, the discussion revolved around reviewing guidelines for the second commitment period, where the stress was on taking consequences into account after they had been identified. The key highlight of this session was China’s suggestion to insert text that would prevent Annex 1 Parties from resorting to unilateral measures against imports from developing countries on grounds of protection and stabilization of the climate. This proposal was strongly opposed by EU and Canada.

Discussions in the Finance track made little progress today. Parties are still putting forth their positions and raising issues that underline fundamental differences between Annex 1 and non-Annex 1 Parties. The US read out its proposal on the mechanisms and architecture for that proposal in greater detail this morning. The US proposal is along the lines of a trust fund structure, with donors in the ‘driver seat’ and a system that can accommodate contributions from all Parties. It did not get much support from the non- Annex 1 countries for it to be the sole window for financing climate change action. Parties such as Indonesia and Bangladesh said they saw no fundamental difference between the US proposal and existing GEF and World Bank funding. Colombia highlighted the fact that these mechanisms do not provide easy access to funding and have not worked so far. They also pointed out that if the second commitment period of the Kyoto Protocol was not renewed, then even existing successful (but currently minimally-funded) mechanisms such as the Adaptation Fund would cease to be functional.

In the LCA contact group on response measures, Argentina stated the importance of sustainable development as a precondition for addressing climate change, and insisted on the term ‘negative’ appearing before impacts. India suggested that para 2 of the non paper include the term ‘developing country Parties’ – in reference to the negative social and economic impacts of climate change. However, EU came back on this point and noted that people in all countries were capable of being negatively impacted, and hence requested the option of all Parties to be included.

On Adaptation, Parties delved deeper into section A of the non-paper, and gave the chair a mandate to come out with a new non-paper by Friday. Colombia proposed new text that would protect the interests of ecosystems. Canada agreed with many Parties, including the Maldives, that adaptation actions need to be country-driven. While LDCs and SIDS want special reference to most vulnerable countries, South Africa indicated it would prefer the text to have a reference to any vulnerable communities, and noted that some areas needed a transboundary adaptation response.

The session on Mechanisms saw several proposals on new market mechanisms that would boost the transition to a low-carbon economy. The proposals were from the EU, Republic of Korea and New Zealand, and focused on sectoral trading and sectoral crediting as ways to move forward. The proposals also included enhanced and improved CDM Mechanisms that would in effect, allow developing country Parties to participate in international market mechanisms, and these sectoral proposals would be country-driven. Some Parties requested technical papers on the operation of such processes, so that the same mistakes that were made with CDMs would not be repeated here. Venezuela opposed the entire approach, while many asked for clarifications on the issues of double counting, MRVs and the role (if any) of NAMAs in this process.

FOCUS ON THE GOI

In most of the discussions attended, India was fairly quiet today.

In the contact group on response measures, India asked for the insertion of text ‘developing country Parties’ under a paragraph which referred to the negative social and economic impacts of climate change. This move was opposed by the EU, saying that people everywhere can be negatively affected by climate change.

The head of the Indian Delegation, Shaym Saran gave a press briefing to Indian media, as well as a briefing for International NGOs. While many of the statements were similar to the ones made yesterday to Indian NGOs, an important point he made was a clarification on the US position in the Kyoto Protocol, where he said the only narrow issue for US involvement and commitment was a method to compare their commitments to those of other Annex 1 countries (the US has not ratified the Kyoto Protocol, and therefore does not have legally binding obligations). He also gave some clarifications on the US MRV proposal and where India stood on the issue.

ICW Daily - CSM@Bangkok - 6 Oct 2009

HEADLINE NEWS

Kyoto Protocol: no discussion over numbers as yet: NZ reminds everyone that if offsets are restricted, they will have to lower their targets.

Crucial discussion on LULUCF in KP scheduled for tomorrow.

IEA yearly World Energy Outlook out today: Says savings from energy, co-benefits etc more than offsets additional investment.

REDD begins negotiations today afternoon: G77/China meeting on LULUCF expected tomorrow.

Adaptation contact group is busy – new text out.

Head of Indian Delegation Shyam Saran meets with Indian NGOs.

KEY ISSUES OF THE DAY

Progress was again minimal at the Kyoto Protocol targets discussions, with more debates on offsetting and targets. While several Annex 1 Parties were pushing for a greater role of markets in meeting targets, non-Annex 1 countries warned about the need to create supply in the case of carbon markets, and on the need for concrete targets.

Annex 1 Parties indicated their domestic difficulties in moving towards an international carbon markets framework. The EU pointed out that their domestic policy limits access to international markets. Canada said offset limits was a domestic policy issue, and New Zealand said that if offsetting were to be restricted, it would be forced to lower its target further (current target is only 5% below 1990 levels, and includes hotly debated areas such as LULUCF).

On the issue of base year, Canada is the only country to continue to demand 2000 as the base year, all other countries agree to 1990. In the corridors there was considerable talk of this sticky point and the fact that no other Party was requesting a 2000 base year.

On REDD, negotiations based on consolidated text began today. While many agree that forests may not be the ideal or long-term solution to emission reductions, they can serve as an interim buffer solution, and help forest conservation in the process. The largest forested areas – Boreal and Tundra forests - lie in the Russian Federation, and it becomes important to recognize them as a key stakeholder in the process – currently it is the Coalition of Rainforest States that are considered the key stakeholders for the REDD and REDD plus issues.

On Flexible Mechanisms, in the LCA today, non-Annex 1 countries were pushing back against the desire by some Parties to remove some of the text relating to the Kyoto Protocol. South Africa is soon to table a new proposal on the issue, and the United States tried to address concerns of some non-Annex 1 Parties.

The LCA discussion on developing country mitigation action (1b(ii)), the two main issues discussed were the means of implementation of mitigation action, and the agreed cost of all mitigation related actions in developing countries. The EU proposal (supported by US and Canada) to place the finance text in the Finance section was opposed by many non-Annex 1 Parties. There was also much discussion on what text on cost would be appropriate, ‘agreed full incremental cost’, ‘full incremental cost’, ‘agreed full cost’ or ‘full cost’. There was also some discussion on commitment periods (whether to have 8 or 5 year), on how to quantify QELROS, and on mid-term review.

FOCUS ON THE GOI

In the mitigation contact group today, India said it was not possible to discuss mitigation separately from the means of implementation, since there were some critical elements in some paragraphs that could not be separated. Under NAMAs, India said two crucial elements were the mobilization of new and additional financial resources, and support for actions based on needs identified by developing countries.

Saving the biggest highlight for the last, was the Head of the Indian delegation, Shyam Saran having an informal chat with Indian NGOs. In a discussion that went on for a little over an hour, he gave NGOs a sense of where the negotiations are at present. He indicated that although progress had been made on technology transfer and adaptation, there was little progress on the key areas of finance and mitigation. He said ‘we have not been able to get far on this front’.

Mr Saran said we are not in a very good position to get an ‘ambitious outcome’, and he was no astrologer to predict the outcome at Copenhagen, but hoped that it would help to address some of the key issues.

On the domestic front, he agreed that it was in India’s own interests to do more, since India too had sufficient low-lying areas and for several million people to be affected by climate change. However, in terms of the international negotiations, he indicated that G77/China were a fairly formidable front of 130 countries, whose demands could not be overlooked simply because of one big developed country that had not yet come on board. He was very clear that India was most keen to keep the Kyoto Protocol, and not kill it. He said that unfortunately, things were not moving in the direction that Bali (in 2007) had intended to put on track. But to move forward and to deal with the climate crisis, there was a need for collaboration, not competitiveness; and to realize that a key issue in this whole debate was equity.

Shyam Saran also, somewhat controversially, called on India’s media and civil society to get behind the government and support it in the negotiations. There was a perception that western media were unfairly targeting India and this was detrimental to the GoI’s efforts in the negotiations.

ICW Daily - CSM@Bangkok - 5 Oct 2009

HEADLINE NEWS

Informal consultations (without observers) seem likely in Shared Vision and Mitigation sections.

Technology section makes good progress. Many make constructive suggestions to strengthen text. Chair says work here should inspire rest of contact groups.

Parties put forth various numbers on long-term targets for Shared Vision. 

Adaptation text could be up for drafting tomorrow. Shorter text to be out by Thursday. 

United States puts out a new proposal for financial mechanism.

KEY ISSUES OF THE DAY

Whilst the negotiations are confronted with the practical problem of lengthy text that makes it relatively ‘un-useable’ for Copenhagen, there is also the political issue of the lack of commitments on finance or emission reduction targets being put forward by Annex I Parties.

However, the first day of the second week of negotiations began with some progress being made in the areas of Technology Transfer, Shared Vision, Adaptation and Finance. Overall, the text has been cut down, and is structured better than it was last Monday. There is therefore the potential to end this week with a negotiating text.

In the corridors we hear the need for dynamism to be injected into the process, and this would truly be reflected if negotiators stayed late, and sat down to draft more text. While that has not happened as yet, the EU Head of Delegation Turesson Anders indicated, said that negotiations were making some, albeit insufficient, progress. However, the China Head of Delegation Yu Qingtai indicated that industrialized countries as a whole were trying to change the rules of play weeks before the deadline for a new climate pact.

On Technology Transfer, Parties and the Chair agreed that it was important not to reinsert text that would effectively take us ‘one step back’, but to set a good example and to provide ‘good vibes’ for the rest of the negotiations. This is text on which there is significant convergence, but many Parties including Canada and Pakistan saying there was a need to concentrate on institutional mechanisms.

On Shared Vision, Parties met once again. This session focused on the long-term global goal as well as the nature of the flow of the text. Most Parties reiterated their (or their group) positions, with AOSIS asking for a target based on science and the precautionary principle. The EU emphasized that a peak was also an important criteria. Many Parties indicated that a 50% reduction in emissions from 1990 levels by 2050 was the desired level of ambition, with AOSIS asking for developed countries to cut their emissions by 95% below 1990 levels by 2050, and for clear mid-term targets. Of the Parties that spoke, Norway was the only country that mentioned a base year of 2000, and Saudi Arabia was the Party that raised the issue regarding vulnerability also implying economic vulnerability (possibly a direct reference to themselves).

The relatively big news on Finance was a new proposal on funding and mechanisms, proposed by the United States. The US provided a detailed elaboration of its proposal which would build on existing institutions (such as the GEF, the LDCF, SCCF and Multilateral Banks), and have an operating entity consistent with the Convention. Papua New Guinea brought to attention the overt focus in the text on just mitigation and adaptation, to include other sectors. The step back in the Finance section included a re-inclusion of text, annexes, and some new text.

The US has also made a submission in the mitigation section, on MRVs for both developed and developing countries, with enhanced National Communications with low carbon pathway plans, review by expert panels and presentations by Parties to the SBI.

Key developments within the US that may have a bearing on the negotiations here, including the US Senate bill to move for a national policy on climate change – hopefully before Copenhagen. The Environmental Protection Agency has proposed a new cap on greenhouse gas emissions from some of the largest polluters. These two tracks will together help reducing emission reductions in the US. But will this help the world get a fair and binding agreement on climate change – that will still be answered only at Copenhagen, or hopefully, by Barcelona.

FOCUS ON THE GOI 

India shone through in the technology section under the LCA track today, with the Chair (who provided superlative congratulations to many countries) saying the constructive suggestions were magnificent.

India indicated that the text on technology was good, with several areas of convergence. That this provided a basis on which to work. However, there was a need to convert the Bali Action Plan and the Marrakesh accords into accelerated and action oriented work.

This could be made possible through robust financial arrangements that could be linked to the finance discussion. However, the GoI Delegate indicated that there was a real need for roadmaps (as the United States also indicated), and for developing countries to enumerate what technology and actions need to be financed. As for the operational details, the delegate indicated these procedural issues could be finalized after Copenhagen.

ICW Daily - CSM@Bangkok - 3 Oct 2009

HEADLINE NEWS

A new week of negotiations begin. Hopefully more text will be consolidated by Monday. Some text to be consolidated by Tuesday.

First reading of newer text on Finance finishes. Mexico makes strong pitch for its Green Fund proposal, says ‘victims of today (us), may well be the culprits of tomorrow.

Consolidated text on Reduced Emissions from Decreased Deforestation (REDD) out. Many areas of convergence, Parties to revert next week.

Text on Mitigation Action by developing countries consolidated. Parties provide initial thoughts.

KEY ISSUES OF THE DAY

Parties (member states) finished their first reading of the consolidated negotiating text on Finance today. Many take this to indicate progress, particularly because Finance and the architecture for institutional arrangements to deliver it form the crux of any potential deal at Copenhagen. During the discussion, while several Annex I countries were in favour of existing financial institutions (e.g. IMF and World Bank and Global Environment Facility) continuing as the key touch points for disbursal of finance, Many non-Annex I Parties argued that speaking from experience, it was difficult for many to access these institutions and get financial aid from them.

Mexico’s Proposal for all countries to contribute to a ‘Green Fund’ in proportion to their respective capabilities and historical responsibilities met with some nods of agreement from several Annex I countries, while the G77/China, Pakistan, China and India were not in favour of the Mexican proposal, or any proposal that was not in conformity with the Convention.

Consolidated text on reducing emissions from deforestation and forest degradation in developing countries (REDD) was available today, and Parties went through the initial portions of the text, including principles and scope of the text. It was decided that Wednesday 7th October would be set aside for drafting of the text, based on the condensed text now made available. Parties agreed that there was much convergence on this issue, but that the aspects of REDD that referred to finance would have to be looked at once the overarching issues of overall finance (including figures) were looked into.

The chair indicated that negotiations on text could begin by Wednesday 7^th October. Bolivia stressed the need to maintain environmental integrity, and recognize the interests of indigenous people. They noted that the current text concentrated too much on mechanisms that would, in effect, help Annex I countries meet their emission reduction needs. India raised the question of subjectivity in the text, such as ‘low carbon’, while Norway indicated that biodiversity principles and attention to biodiversity conservation needed to be improved.

Consolidated text on developing country mitigation action (1b (ii) of the Bali Action Plan) came out today. On the overarching pillar of mitigation, Australia had recently proposed a registry of mitigation actions (whatever they might be) for both developed and developing countries. These would include the nature of the targets (domestic/offset/ technology improvements/ adaptation actions, etc), and eventually help in assessing combined contributions for a long-term goal. In the discussions today, Australia proposed that this registry system be complimentary text (i.e. not as an option that can be negotiated out of the final deal). Japan indicated that new text misses out details for measuring and reporting on mitigation funded actions. Overall, the discussion was rather positive, and Parties will come back to the text on Thursday next.

FOCUS ON THE GOI

On Finance, India requested the chair to condense the text but to do so in conformity with the Convention and its guidelines. While this view is supported by most Parties from G77/China, many Annex I Parties, including the United States, Australia, Canada, EU and Japan are not averse to exploring new possibilities and mechanisms that can add value to the Copenhagen outcome. These include market mechanisms, as well as substantial reductions in emissions (as compared to a business as usual scenario) by large and key Non Annex I Countries.

On REDD, India’s interventions focused on the sources and basis for funding of REDD Mechanisms. Dr. Prodipto Ghosh highlighted the point that text such as ‘low carbon’ was ill-defined, and not in the Convention. That in the interest of keeping things simple, such principles must be kept out of the text. He also said that in the current text, there was a reference to nationally appropriate mitigation actions (NAMAs), and that this should be removed owing to such references posing contradictions to the Convention, but also because this could raise the issues of double counting.

On developing country mitigation actions, India raised issues of substance as well as arrangement. But indicated that this section – which is meant to address the requirements of developing nations did not do so. For example, that the reference to offset in the text should not be included here, as again, it raised the issue of double counting.

ICW Daily - CSM@Bangkok - 2 Oct 2009

HEADLINE NEWS

Weekend Stock-taking session for Kyoto Protocol (KP) and Long-term Cooperative Action (LCA) tracks today.

Kyoto Protocol - stock-taking indicates good progress made on land use change, potential consequences. Targets for emission reduction remain the big question.

LCA – Technology transfer and capacity building makes good progress. First reading of text on Finance nearly done. Progress remains to be made in mitigation, adaptation sections.

Venezuela says in the past there use to be land grabs, now it is sky grabs.

KEY ISSUES OF THE DAY

Today marks the last day of the first week of a two-week session. Negotiators have a text before them that they must consolidate, but the point is not so much that they have to cut down the number of pages (>200), but rather that they must identify the key elements that must go into a Copenhagen deal.

As the Chair of the Kyoto Protocol session indicated during the stock-taking session, the reality of the crisis has NOT sunk in. That, while politicians made big promises at the UN Secretary General’s summit on climate change, those statements have not translated into anything concrete here.

Eleven negotiating days remain for the Copenhagen process to start. In this short time, negotiators have the unenviable task of seeking to avoid key numbers and commitments while negotiating text. While a number of Annex 1 countries have put down numbers for 2020 and the G8 have agreed to an 80% reduction by 2050, the level of ambition is criticized for not being enough. AOSIS critiqued the Annex 1 collective ambition of 11-18% below 1990 levels by 2020 and said this would lead to a temperature increase of “3 degrees C or worse.” The numbers do not go far enough to meet calls by them and other nations for cuts between 25-40% by 2020, based on what the science demands (IPCC 4th Assessment report). Mitigation action by Annex 1 countries and meaningful contributions by major developing economies is one sticking point. Another is the numbers on finance. These are all issues that will be subject to horse-trading. The fear is that decisions on these key issues will have to wait till the big guns arrive – the politicians – at Copenhagen. By then it may well be too late to reach agreement.

While the Copenhagen outcome will be new, the UN Convention is the main reference document on which the new deal will be built. It will also be guided by the Bali Action Plan, which provides the basis for a larger picture and a long-term vision that will give a perspective to the new outcome.

As for the Kyoto Protocol, it is the legal offspring of the Convention, valid till 2012. Over the course of the week, it has become apparent that some Annex I countries would prefer to phase out the Kyoto Protocol for the post 2012 deal. They would rather have a new deal that does away with the Kyoto Protocol but which keeps in line with the Convention and the Bali Action Plan. But the question then arises – how will a new, legally binding (preferred option) deal be drafted, and practically speaking, how long might that take?

Many non-Annex I countries, keen to retain the focus on Annex 1 countries, say that portions of the current text (proposed by Annex I), undermines the three key principles of the Convention - historical responsibility, common but differentiated responsibility and environmental integrity. They charge some Annex I countries with seeking to erode these principles of the Convention. Developing countries also say that the new text cannot just do away with the Kyoto Protocol, since that does away with any sort of legally binding compliance.

Given there are only eleven days (six here, five in Barcelona), time is running out. So the best way to move forward from here, is to focus on core issues and mechanisms. The chair of the AWG will soon convene informal meetings (tomorrow) that will aim to speed up the process for the following week.

The Climate Action Network urged the KP and LCA chairs to inject the political momentum from New York into the negotiations, and urged deviation from business as usual especially in these negotiations.

FOCUS ON THE GOI

In the mitigation section, India indicated that it would like to request the Secretariat to list currently available literature on whether the level of ambition put down by developed countries was adequate, and to assess the targets in comparison to the IPCC 2007 report. This was in response to the Australian proposal of schedules for future targets, on which all countries would put down their numbers.

In the stock-taking session of the LCA, Mr R.R. Rashmi – a key negotiator for India (on all issues technical), said they thought progress so far was fairly good. However, he said that in our efforts to reach a deal, we must not sprint to the end, but rather focus on some key areas:

• Developed countries had to give a deep emission reduction commitment, and reduction of 40-45% below 1990 levels

• Deliver on Finance without losing time

• And a global mechanisms that would deliver technology transfer at affordable cost would be a deal-clincher

He said if delegates could organize their work here to get these key issues on board, and inscribe it into the text before us, real progress could be made before Copenhagen.

The comments were appreciated by the Chair, owing to process suggestions that would lend clarity and de-cloud the rest of the week of negotiations.

ICW Daily - CSM@Bangkok - 1 Oct 2009

HEADLINE NEWS

Finance discussions plod ahead. Developed country parties want equal importance given to private and public sector funding. Many developing countries want public financing to be major source. India raises important issue of triple counting emission reductions. Battle lines seem drawn.

US indicate preference for all countries to give their mitigation commitments for the long term. Australia puts forward proposal for listing and accounting for mitigation commitments (everybody). G77/China, India raise concerns about Annex I slipping away from historical responsibility, of themselves having to take on new mitigation targets

Text on Capacity Building might be done rather soon.

US say global deal that does not take their domestic policies into concern will exclude possibility of US money. ‘To access our money’ you have to design a policy in that way – Pershing.

REDD moves smoothly. Parties agree to consolidate initial parts of text. Start discussing what is important for Copenhagen.

KEY ISSUES OF THE DAY

Time is ticking, but it is becoming increasingly clear, that if things do not move in the Long-term Cooperative Action (LCA) track, then things will not move in the Kyoto Protocol track either. The log-jam however, doesn’t end there. It spreads into cross-cutting areas of discussion like a domino. Finance continues to be a fraught and unyielding area in the negotiations.

Discussions on Finance under the LCA are stuck for a number of reasons. One is that private sector financing is favoured by some Annex 1 countries as a key aspect of the funding mix. While they ‘accept that public funding is essential’, and are not shying away from it, they ask for their proposal of private investments to be considered seriously. In effect, the role and potential contribution of market mechanisms in facilitating mitigation actions in developing countries is proving controversial.

Many non-Annex 1 countries favour straightforward public finance from Annex 1 countries as funding, as it bears less risk for them than being exposed to the vagaries of the market. Small developing nations in particular, favour a greater share of public finance as market mechanisms under the Kyoto Protocol (such as the Clean Development Mechanism) have overwhelmingly benefitted the larger emerging economies such as China, India and Brazil.

Looking at a range of options, many Parties raised the pertinent point that future outcomes (whatever they might be), must not be restricted by the Convention. Even the LCA chair alluded to this, saying that we must no be like a ‘nightingale in a cage’.

Sure enough, neither the G77/China, India, Pakistan, Barbados, Colombia, China nor most others of the Non Annex I block said they would not agree to any proposals that were outside the provisions of the Convention, and the Bali Action Plan. The G77/China alluded to the market process becoming like a ‘self-service’ mechanism.

Practically speaking, new text outside of the provisions of these documents (that themselves were many many years in the making), means more negotiations, more negotiations and more negotiations. And sure enough, proposals will only be countered by counter proposals – which is how we now have a 208 page document that not even the most experienced and wily negotiator can make sense of.

In the second half of the discussions on Finance, the G77/China finally made mention of the AOSIS and LDC countries, and that they would require some special consideration. This is some reason for cheer, because it has been observed that although the AOSIS and LDC blocks are part of the G77/China, they get little special mention.

The United States continues to hold to its line that larger developing countries with the means to do so must also make contributions to mitigation. The Delegate from the US noted the difficulty that domestic processes presented to the US being part of international agreements, and which implied they could never become a part of the Kyoto Protocol. The US conclusion on finance was:  if you want to access our resources, you have to design a policy taking our laws into account.

FOCUS ON GOI

In the mitigation section of the LCA, India opposed the proposals of the Annex I countries to keep the paragraph that indicated that private funding would be the major source of money for mitigation and adaptation actions in developing countries. They stuck to the common G77/China stand on following the Convention and the Bali Action Plan, saying that any proposals that did not incorporate those principles, could not be part of the new text. They indicated that proposals to diminish the role of public sector funding ignored the concept of responsibility.

In the Finance discussion of the LCA, India raised two points:

One of triple (or is it quadruple?) counting – that mitigation options considered outside of a legal framework could technically be counted by developed countries as meeting their responsibility, by developing countries as their Nationally Appropriate Mitigation Actions (NAMAs), and by developed countries as meeting their financial requirements. Plus they could potentially get Certified Emission Reductions (CER) for it.

They also argued that if the private sector was to be the major source of funding for mitigation and adaptation action that this would come under bilateral partnerships, that would not count as supported mitigation actions (as is intended to be the case).

ICW Daily - CSM@Bangkok - 30 Sep 2009

HEADLINE NEWS

G77/China Chair in press conference says rich countries want to ditch Kyoto Protocol.

NZ becomes bakra of meeting on Kyoto Protocol. Responds to its recent decision to further kill level of ambition. Is asked to defend its position by South Africa. Says from a developed country perspective, NZ is almost like a developing country.

Brazil, China, South Africa, India, Micronesia make impassioned statements at Kyoto Protocol targets discussion. Says Annex I countries are forgetting developed country populations, historical responsibility, or that there is a real climate crisis while defending their poor level of ambition.

KEY ISSUES OF THE DAY

Negotiations on Long-term Cooperative Action (LCA) continued today, with contact groups beginning the process of consolidating text on developed and developing country mitigation actions (each under separate paragraphs of the Bali Action Plan). Recall that mitigation is a key process to actually reducing emission reductions, and that at some time in the future, developing countries (as they develop) also need to set some targets. For now, the silence is valid and allowed, although pressure for some major developing countries to come out and make commitments is building.

While there is a clear mandate in the Bali Action Plan for developing country emission trajectories to reduce ‘significantly’ from Business As Usual (BAU) paths, the differences of opinion here, are focused around the actual targets, and the need for developing country actions to be Measurable, Reportable and Verifiable (MRV).

G77/China and several developing countries indicated that all actions on mitigation that they would take up by themselves (unilaterally and therefore not financed from Annex I countries) would:

-         not be subjected to verification

-         be voluntary

-         and bottom-up (decided domestically)

This is something they have been saying right from the start. Nevertheless, with 65 days to Copenhagen and the pressure for a deal (post 2012 deal) building, developing country silence on any sort of long-term targets seems to be exasperating developed country partners. Many Annex I countries are unable to come to grips with political posturing by India and China or even Indonesia recently, with none of these actually translating into ‘commitments’.

As for the LCA discussion on the nature of developed country mitigation targets in the future, today’s session was focused on the issue of ‘comparability’ – or how emission reductions can be measured one against the other. The United States is keen that comparing targets is done through a domestic process that is then peer reviewed. G77/China and India argued for top-down setting of targets that are objectively reviewed by a legal international process.

Technocratic decisions aside, Parties are still in the process of putting logical bits of currently incoherent text together, so that they can then begin the process of negotiation. As indicated yesterday, real negotiations are still likely to begin only by Monday.

Coming to the other track of the negotiations – the Kyoto Protocol, decisions on Annex I mitigation targets below 1990 levels are still to be decided. Parties (Annex I) still have to agree on the base year, the commitment period, and the proportion of offsets that will come from domestic cuts.

However, it is rather clear that targets are a hugely political decision, and that negotiators here may not have the mandate to set such targets. In effect, the three hour session on Kyoto targets managed to get rather heated, confused and an unhappy exercise for most Parties.

The EU began with its progress report, which included a display of how to use hot air as credits, and how it was possible to cash in on all the loopholes in the Kyoto Process while claiming emission reductions. While their intentions may have been noble, and while they are the only developed country block showing some environmental integrity, they managed along with Japan, to ask for a joint session between the KP and the LCA – tracks meant to be addressed separately since 2007. They added meat to their argument by saying that the LCA and the Land-Use and Land-Use Change (LULUCF) discussions had not progressed so far, and that this meant there was little hope for the targets discussion here at the KP to progress.

The invisible elephant in the KP room was the US, which was mentioned in the discussions despite its not being a member of the Kyoto Protocol. The EU asked for developing countries to make their long-term targets clear so that they (Annex I) would be able to meet their Kyoto Targets. Australia said encouraging political statements made by several developing countries had not yet translated into any action here, in the negotiations, and was visibly exasperated by this. The KP session was not perhaps the most appropriate forum to bring all these issues up – it could easily have been discussed at the LCA sessions.

Venezuela began the rebuff on these suggestions to mix the tracks, by saying ‘no-one held a gun to their head to sign the Kyoto’, but ‘now they want to throw the responsibility on developing countries’. South Africa, India, China, Micronesia and Pakistan chimed in agreement on no need to mix tracks. China made an impassioned statement about whether they ‘recognised their responsibility’, and that they were talking here of 1/4^th of the world’s population causing here quarters of the emissions, and vice versa.

What could this complete waste of three hours imply? Simply that there was an absence of a clear political mandate from Annex I countries, and that this meant a stalemate here. As the South African delegate clearly said, ‘it’s a chicken and an egg story’, and nothing will move until something moves, but if no one wants anything to move then nothing will move.

FOCUS ON THE GOI

At the LCA, India mostly clarified its position on what it and the G77/China understood by the paragraphs on NAMAs for developing countries. On developed country mitigation requirements, negotiators said there was a need for all comparability of efforts to be transparent and done through an objective process. They also indicated that they wanted the benchmark for future ambition and targets to come from the architecture (rules and processes) of the Kyoto Protocol.

On the KP targets track, when the EU and Australia suggested the idea of a joint session for the two tracks, India said ‘was it a dream that we met in Bali where we decided to keep the KP and the LCA tracks separate?’ India argued that what developing countries said - referencing to Australia’s exasperation on political movement but lack of translation into negotiation process - was not relevant here. They charged that Annex I countries were comparing apples, oranges and all kinds of Annex I fruits, and finding ways of measuring their emission cuts in several different ways. But that they were not addressing their targets in the context of science, rationality, and responsibility.

ICW Daily - CSM@Bangkok - 29 Sep 2009

WISE WORDS FROM THE NEGOTIATORS

“Let us discuss FOOD and what it looks like.

But do we get to eat it?

… well, that’s another matter altogether!”

HEADLINE NEWS

Line-by-line negotiations only look likely by Monday next. ‘Accelerator’ meetings may add some momentum.

United States brings up issues of mitigation commitments. Almost threatens to stall negotiations if its demands are not met

Negotiations on Technology Transfer move smoothly. Some reason for cheer. Co-chairs given unanimous mandate to consolidate all of the new text on the section by Thursday.

Adaptation, Shared vision for Long-term Cooperative Action text hits same old roadblocks. Developed countries oppose developing country preferences and vice versa.

Finance negotiations start on text from the word go, differences in Parties’ approach remains. Similar status quo on differences in Shared Vision for Long-term Cooperative Action.

New Zealand may backtrack on already miniscule targets. Sets more conditions for acceptance.

KEY ISSUES OF THE DAY

For some time now, there have been large differences between key Annex 1 and non-Annex 1 countries  regarding mitigation issues – specifically, how each group should address emission reductions and mitigation action. These specific mitigation discussions have failed to progress for some time now, but in the run-up to Copenhagen, it is crucial that these matters be resolved as they form a key part of the negotiations.

Developing countries want measurable reportable and verifiable (MRVs) commitments for themselves to be discussed as a separate issue from that of developed country MRVs. The United States wanted a discussion on mitigation elements common to all Parties, and for this issue to be discussed under a separate sub-group.

Matters came to a head yesterday when the US said it would not move forward on the rest of the negotiations on mitigation unless this issue was settled, and their demands met.

Australia and Norway supported the US proposal, while India led the opposition supported by China and the G77+China. While such spats threaten to stall discussions and get reported as such, they are in some ways a good sign that negotiations are indeed progressing. Unless diplomats thrash out their differences (even if they are through veiled comments), there will be little progress. No one wishes for a treaty or a deal on which everyone agrees meekly, and in which no one strives to achieve what is in the best interests of all.

For some good news, decent progress has been made on the section on Enhanced Action on Development and Transfer of Technology, with parties asking the co-chair to go ahead and consolidate the entire text. Blocks of text will be circulated to Parties as and when they get ready, and the entire text on technology will be ready by Thursday. The G77 and China however, did manage to dampen the spirit of the negotiations, by saying that although all the text could be consolidated, they may or may not find it acceptable.

Other tepid news included slow movement on discussions of Finance, and on what portions of the text Parties would agree to. Here again, developing countries insisted that details of Finance must be out, and that paying for ‘services’ in some sense, must not be considered as charity.

For some time now, the only region to verbally commit some money to the process and through the Convention, has been the European Union (EU). However, many experts suggest the money proposed by the EU is too low.  The EU today expressed its belief that much money would come through external mechanisms such as carbon markets and private sector investments rather than government transfers. G77 and China, India and the Co-Chair, pointed out that neither the EU nor any Annex I countries should mix issues, nor confuse their obligations with external or optional mechanisms.

Not to make too fine a point of it, it seems rather clear that while developed countries are less and less keen to talk about ‘differentiated’ responsibilities, the developing countries refuse to talk about ‘common’ responsibilities. Developed countries are also firm on wanting major developing countries on board with legally binding mitigation targets – something that countries such as China are opposing in a big way.

Polemics aside, negotiators are keen to make progress on shortening and clearing out the text. Given the short span of time left to thrash out issues (only 13 negotiating days), they are also keen to focus on the key and ‘bigger picture’ issues, and leave the nitty gritty bits of relatively unimportant text for a post-Copenhagen discussion. Nevertheless, it seems inevitable that hard negotiations will only be able to hit the ground by Monday, since much discussion on process, the ‘how’, and on consolidating text is currently underway.

Focus on the GOI

At the mitigation discussion, India questioned MRV and highlighted the need to discuss the issue of mitigation separately for Annex I and Non Annex I countries. This grew into the much talked about spat between the developing countries and US negotiators, with India being a special focal point. The US delegate Jonathan Pershing, breaking protocol, made a direct reference to India’s environment minister’s recent statement, but going further, suggested that the US would be unwilling to continue discussions on the matter unless they got consent for a formal contact group.

Nevertheless, on more substantive issues, India did reiterate environment minister Jairam Ramesh’s statements that the scope and frequency of the National Communications (NATCOMs) would be expanded to each year, as opposed to every six years until now. However, India reiterated its position that mitigation actions not supported by developed country action would not be subject to verification.

 On Finance, India highlighted the need for a financial mechanism under the Convention, since there was only an interim arrangement through the GEF at the moment.

India’s position is unlikely to have changed as regards MRVs and legally binding targets. This is similar to what the Chinese may have in mind at the multilateral process, regardless of bilaterals and their own unilateral mitigation actions.