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Green Climate Fund: the glass is half full

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With $7.5 billion now committed to the GCF, the Fund is halfway to the goal of $15 billion for its initial resource mobilisation. A final push this week can top it up.

It’s been a remarkable few weeks for global climate diplomacy – if not quite yet for the global climate.

Last Wednesday, much of the world woke up (Asia was able to follow in real time) to news that Presidents Xi Jinping and Barack Obama had been able to take time away from the high-stakes trade negotiations during APEC to hammer out a deal that committed the US to emissions reductions of 26-28% from 2005 levels by 2025, and China to stopping the growth of its emissions by 2030 (if not well before).

China also committed to sourcing 20% of its primary energy supply from non-fossil and greenhouse gas emission free sources like wind and solar. This means that over the next 15 years, China could build renewable energy capacity equivalent to the entire current electricity generating capacity of the USA.

Two days later, just as G20 leaders were gathering in Brisbane, rumors started circulating about commitments to sizable contributions to the Green Climate Fund (GCF) from the US and Japan, which were eventually confirmed to be $3 billion and $1.5 billion respectively.

Then, during the G20 Summit, the issue of climate change rose to the top of discussions as a strong civil society mobilisation and the majority of G20 leaders pushed back on Australian Prime Ministers Tony Abbott’s doomed attempt to keep the topic off the agenda. At the summit Australia, Canada and Saudi Arabia were pitted in “trench warfare” against the majority of leaders supporting action on climate change.

By the time the dust settled, the final communique had a strong endorsement of the UN climate negotiations towards a new agreement in Paris next year, a call for early submission of national targets and commitments to action on climate change as part of the agreement, and explicit support for the GCF. As leaders flew home, the message flying out to the world was clear – climate change is a serious global challenge that is at least on a par with the economy and security concerns, and deniers of this truth will not be allowed to stand in the way of progress.

Apparently, seeing the writing on the wall, even Canadian Prime Minister Stephen Harper, in a surprising break with his Australian counterpart and ally, announced that Canada would be contributing to the GCF.

All of this is good news but it is good to keep it in perspective.

While the announcements in Beijing and Brisbane send the right political signals, and will certainly help build momentum and urgency for global efforts, they are far from sufficient (so far!) to put the world on a path to the agreed goal of keeping the planet below the dangerous 2 degree temperature increase.

The US and China targets are important steps forward and, together with the previously announced EU emission targets of at least 40% below 1990 levels, now countries responsible for over half of global emissions have sent strong political signals about the importance of negotiations toward Paris.

Even taken together, however, they don’t constitute the type of emergency mobilisation we need to rapidly shift investments into low carbon technologies, including the increasing competitive wind, solar, energy storage and electric vehicle technologies. Solar and wind power have already achieved “grid parity” with nuclear almost everywhere, and with fossil fuels in a large and growing number of regions. UBS Investment Research suggests a payback time as low as 6-8 years for a combined Electric Vehicle + Solar + battery investment by 2020 – unsubsidised.

The announced contributions to the GCF, while very welcome, are are still not up to the scale of the challenge, with some rare exceptions like Sweden’s $500 million contribution. NGOs and most developing country governments have called for total contributions of $15 billion this year, as the minimum needed to accelerate action on the ground in developing countries to support clean energy, efficiency and areas needed to support low-carbon, climate resilient development. UNFCCC Executive Secretary Christiana Figueres has proposed the more modest number of $10 billion.

Current commitments total around $7.5 billion, with at least $1 billion still expected from the UK, and the potential for significant new contributions from countries like New Zealand, Canada, Italy, Norway, Spain, and even Australia, if they decide to pitch in and do their part for the global effort.

Several developing countries have already indicated their willingness to contribute as well, and in the last climate negotiations in Bonn, Brazil proposed that developing countries should be formally invited to indicate their South-South financial and other support and cooperation as part of their national contributions they submit next year. When developing countries are willing to put their finance and technology resources on the table, there is little reason for the wealthy developed countries to hold back.

The next date to watch is the official GCF pledging conference in Berlin on 19-20 November. This is where representatives from all contributing countries can sit around the table, look each other in the eye, and decide how ambitious they want to be, within the negotiating mandates given by their governments.

Let’s hope they will be inspired by the strong message given by the massive People’s Climate March mobilisation in New York and around the world in September, the push from the G2 and G20, the building expectations for Lima and Paris, the needs of developing countries for confidence that sufficient resources will be available if they develop ambitious policies and plans, and go beyond the more modest expectations and do something truly ambitious.

The glass is half full and it needs filling up.

Mark Lutes is a senior global policy advisor for WWF. He is based in Sao Paulo, Brazil.

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