by In some circles, it’s known as weather fixes. In others, payments for “losses and damages”.
Whatever the term, there are growing calls for a new process that would pay developing countries for the damage they have suffered from climate change, a problem they did little to create.
Rich nations like the United States have opposed the idea for years. But its advocates have remained persistent as climate impacts have become more severe, and the issue is expected to be one of the main — and potentially the most divisive — issues at the next round of international climate talks next month in Egypt.
Here’s a quick guide to weather repairs and why they’re important.
1. What are they?
Climate reparations, or “loss and damage” in UN parlance, represent the economic cost of climate-driven disasters such as floods, wildfires and hurricanes. There are also slow-onset climate impacts, such as sea level rise, that can cause irreversible damage over time.
Taken together, these are impacts of climate change that countries cannot defend against, either because the risks are unavoidable or because countries do not have the money to pay for protection.
An example is the Pacific island nation of Tuvalu, which is rapidly losing its coastline due to rising sea levels (climate cableSeptember 23).
Due to this and other climate impacts, a country can lose homes, farmland, and jobs, hurting economic growth. Governments can take action to adapt, but when impacts exceed adaptation, it is considered loss and damage.
However, finding a way to compensate developing countries for climate losses is a contentious issue.
2. What are they not?
Paying for climate reparations differs from financing that goes toward mitigation or adaptation, two established pillars of climate action.
Mitigation refers to efforts to reduce greenhouse gas emissions that are warming the planet, for example by switching from coal power to solar or wind power. Adaptation helps protect against climate-related damage.
Loss and damage is considered a third pillar and, in many ways, exists because actions to reduce emissions and support adaptation have fallen short.
“We’ve been doing mitigation, we’ve been doing adaptation, but both inadequately,” said Saleemul Huq, director of the International Center for Climate Change and Development in Bangladesh. “Now it is no longer something we are preparing for or trying to prevent. But it’s something we’re going to have to deal with.”
That is not to say that mitigating climate change and adapting to its impacts are not yet critical, but the loss and damage make it clear that there is additional need that requires a response. It is a need that advocates argue cannot be addressed by disaster relief, humanitarian assistance or insurance.
And because it is different, vulnerable countries are asking that the money to address it also be separate and distinct.
3. Where are the things?
Developing countries put forward a proposal at last year’s climate talks in Glasgow, Scotland, for a loss and damage financing mechanism.
However, it did not advance because countries like the United States did not support the measure. One concern was that the proposal would make developed countries pay reparations, unlike all major emitters such as China. Another concern was that it could expose developed countries to legal challenges or endless calls for compensation.
Instead, the agreed outcome was a three-year dialogue to discuss how to finance climate damage.
Developing countries have bristled at the prospect of more talk and are increasing their demands to negotiate funding deals this year. U.S. officials said that while they are willing to talk about avenues for loss and damage financing, they will not yet endorse a new mechanism and would prefer to look at existing ways to address the challenge, including through continued efforts to reduce emissions (climate cableOctober 20).
Climate experts and officials from vulnerable countries say that’s unrealistic because warming has advanced to the point where some climate impacts are already unstoppable (climate cable, August 9, 2021). And emissions continue to rise, despite promises to move in the other direction. On Monday, more than 140 US-based climate and development organizations sent a letter to US climate envoy John Kerry urging progress on the issue.
Some actions are happening outside of the UN process. Scotland and Denmark have committed around $15 million between them to address global loss and damage, and finance ministers from the world’s most climate-vulnerable countries have agreed to work with Germany and other wealthy nations to set up a finance mechanism. and insurance to address climate risk.
But developing countries and activists argue that a formal loss and damage financing mechanism should be part of the UN process to give it legitimacy and account for the needs and priorities of developing countries. The Alliance of Small Island States is seeking an agreement among the nearly 200 countries that are part of the UN climate negotiations to establish a new independent fund for loss and damage before the talks in Egypt begin.
4. How to price loss and damage
Some studies have attempted to estimate costs.
A 2018 study projects that total damages in developing countries could reach between $290 billion and $580 billion by 2030. The African Development Bank Group estimates that the continent loses between 5 and 15 percent of its gross domestic product each year due to the impacts of climate change. , while a group of 55 climate-vulnerable nations found that they had lost a fifth of their wealth in the last 20 years due to climate-driven disasters.
Some countries are also beginning to factor loss and damage into their climate goals. The tiny Pacific island nation of Vanuatu is seeking nearly $180 million in compensation for loss and damage and has based its new climate goals on support from developing countries (climate cableAugust 23rd).
What is important to recognize when addressing loss and damage is that it is seen as additional to other forms of climate and development finance and that it does not take as long as existing financial mechanisms to set up and start distributing money, said Tom Mitchell, executive director of the International Institute for Environment and Development, a London-based research organization.
By comparison, the UN Green Climate Fund was created to help developing nations reduce emissions and build resilience to climate impacts. But it can be difficult for countries to access, a particular challenge when money is urgently needed. And humanitarian aid has been inadequate to deal with the magnitude of the problem.
Without a separate fund, countries can simply redirect development aid toward loss and damage and away from other needs, such as poverty reduction and education, something a study shows is already happening with current funding pledges. climate (climate cableJune 23).
5. Why now?
Loss and damage has been part of the UN climate agenda for years. But opposition from the United States and other countries has prevented a robust finance negotiation from getting off the ground (climate cableNovember 19, 2021).
That is changing as the impacts become more severe and frustration over inaction mounts.
Leaders and advocates of climate-vulnerable countries warn that more talk creates unnecessary delays and that rich countries must take responsibility for the emissions that currently cause the damage, out of a sense of solidarity.
“We know that the loss and damage is here. People are suffering. We saw what is coming from Pakistan, Bangladesh, South Sudan this year, and there are more and more extreme events,” said Madeleine Diouf Sarr, Senegalese chairwoman of a least developed countries negotiating group. “We need to have a global solution,” she added.
Among developing countries, loss and damage is no longer seen as a problem limited to small island developing states, finance experts say. The proposal to address loss and damage in Glasgow, for example, was backed by a coalition of 134 developing countries known as the G-77 and by China. That group is currently led by Pakistan, where this year’s historic flooding has cost more than $30 billion in damage.
Many of the countries in that group also face high levels of debt distress, and climate is one of the factors driving growing food and water insecurity.
“This whole issue of climate risk and vulnerable countries increasingly having to deal with more frequent and more severe disasters is becoming a bigger national and international priority for many countries, even outside of climate negotiations,” Taylor said. Dimsdale, chief risk officer. and resilience at the climate think tank E3G.
If an agreement on loss and damage financing is not reached as part of the formal agenda in Egypt, it could set the tone for the rest of the talks, analysts say. It could also reverberate beyond climate negotiations, affecting countries’ willingness to cooperate on a variety of issues, including trade or security.
Reprinted from E&E News with permission from POLITICO, LLC. Copyright 2022. E&E News provides essential news for energy and environmental professionals.
