Bonn: German Development Institute / Deutsches Institut für Entwicklungspolitik (DIE) (The Current Column of 6 June 2016)
After the negotiation of the historic climate agreement in Paris last December, the memorable signing ceremony in New York and a lot of proud tapping on one’s shoulders, the climate community gathered in Bonn during the last weeks. The latest round of UNFCCC talks with approximately 1900 government delegates, 1500 observers and 100 media representatives started to discuss how to translate the Paris Agreement into action. While the effort of interpreting the climate agreement and planning the implementation undertaken by the international bureaucrats is certainly an important next step, it will probably not be sufficient to prevent the transformation towards sustainability lose momentum. Between numerous talks, now it’s important to start acting and to start implementing the NDCs (nationally determined contributions).
Five months from now the next climate conference will open in Marrakesh and it will be crucial that governments can show results: No doubt that the realization of the targeted climate goals will just be impossible without significant contributions from the private sector. And indeed, industries, private and institutional investors have followed the climate negotiations with huge interest. Even more, they have not only silently observed on the process, but have surprisingly emphasised their willingness to take action – which finally, is a quite logical reaction. The private sector above all wants to make money and if they get a strong signal for the economy to go through a transformation, it is in their own interest to adapt to the new business environment. However, now is the moment in time that governments have to demonstrate their commitment that the envisaged decarbonisation plans are meant to be serious and reliable. They need to convince the private and financial sector that the future will lay in green technologies and green business approaches, that global growth models will be changed and that there will be no going back for anyone.
November is approaching fast, thus we need to complement the current diplomatic approach of elaborating another set of global, national, regional and local plans with timely hands-on action! Back to back with the UNFCCC conference a much smaller group of experts from many different countries developed practical solutions and viable prototypes for increasing private climate investments. During the Practitioners' Dialogue on Climate Investments (PDCI) that took place from May 23 to 25 in Bonn, PDCI fellows from the public, private and financial sector, from academia and from different hierarchical positions worked on different concrete projects, such as a prototype for recycling effluent from highly polluting industries (pharmaceutical) in Andhra Pradesh, a prototype of an energy storage system for mini-grid and off-grid electricity in Indonesia, a prototype for an sustainable finance policy for banks and financial institutions in Bangladesh, a prototype for a credit guarantee facility for climate investment projects in Pakistan, a prototype for catalyzing energy efficiency shifting technology in the Philippines and many others.
The PDCI has given a good example of how effective international conferences can be if the concept does not rely on a series of discussion rounds, dominated in many cases exclusively by grey-haired men, including the typical subtle demonstrations of power, self-promotion and intentions to allocate responsibilities. The key for fast action has been a concept of peer-coaching, of recognizing that we have a lot to learn from each other – in particular from developing countries –, of getting started immediately (without long discussions) and of listening to fresh, innovative and pragmatic ideas of stakeholders.
The majority of the developed prototypes will start being implemented by the end of the year; and also governments are called upon confirming irrevocably their determination of stopping climate change by walking the talk. The PDCI fellows had many concrete ideas for government action: (i) provide risk mitigation instruments, (ii) create and secure stable investment environments, (iii) develop standard procedures for project assessments, (iv) invest in feasibility studies and pilot projects, (v) create small funds with small money and bundle projects, (vi) whenever public money goes into projects, make the project related data public, (vii) set the right regulation for pension funds, (viii) put carbon pricing on the G20 agenda. But most importantly, governments must get started now and should not wait for the next round of plans being brought to perfection first. The private and the financial sector need a clear signal that economic models have definitively changed after Paris.