Notwithstanding Governor Brown's lament of the inadequacy of action, there remain many positive signs.
Californian Governor Jerry Brown described the work that was being done at COP23 to meet the urgent challenge of climate change as "taking baby steps". The same could be said of the pace of negotiations on some key issues part way through the second week of the conference.
Speaking at a presentation hosted by the Chinese Government on Tuesday 14 November on the role of emission trading schemes and carbon markets in reducing emissions, Governor Brown called what was being done at COP23 and all the actions being taken internationally as merely "taking baby steps" in the action required to avoid dangerous climate change. This echoed the concerns expressed by scientists before COP23 that the world was not close to achieving the Paris target of limiting the temperature increase to below 2 degrees based on indicative emission reduction targets in current NDCs.
The baby steps analogy could well be extended to the pace of negotiations for the Paris rulebook and related matters for decision. The progress of negotiations at Bonn has been uneven across the more than 50 areas of focus set out in the work plan for the conference. Tuesday 14 November represented the last day of informal negotiations with the informal contact and working groups charged with responsibility for developing recommendations and text for decisions endeavouring to complete their initial work within the set timeframe.
Some groups have been more successful than others with many draft conclusions and decisions approved for submission to the official meetings on issues such as agriculture, accounting for emissions from fuels in the aviation and maritime sectors, capacity building and technical issues such as common metrics in the measurement of GHGs and the operation of the public registry under the Paris Agreement.
For the business community, a key focus remains on Article 6 of the Paris Agreement and the extent of progress in defining the role of the market and non-market mechanisms in reducing emissions, and how these mechanisms will operate. A subsidiary body, the SBSTA, was requested under the Paris work plan to provide advice on, inter alia, the rules for those mechanisms which would form part of the rulebook for the implementation of the Paris Agreement. That work had been delegated to an informal contact group to facilitate discussions among the parties.
What has emerged from the work of that contact group on Article 6 is a draft yet detailed outline of the possible contents of the rules for the proposed market (Articles 6.2 and 6.4) and non-market (Article 6.8) mechanisms. This is contained in an informal note prepared by facilitators of the contact group. The work of that group recognises that a key challenge remains how achieving environmental integrity of emissions reduction through these mechanisms to provide the degree of confidence for financial institutions to invest in instruments and thereby bring scale to emissions reduction technology and projects.
Although key design issues for Article 6 have been identified, a remaining challenge is how to progress the negotiations on those issues over the next 12 months, and this is where negotiations became unstuck on 13-14 November. An informal note prepared by the facilitators of their conclusions on how negotiations should progress to deal with the matters of detail on Article 6 was not agreed to on 13 November. Despite hope that there might be a breakthrough during the afternoon of 14 November to agree the conclusions before the deadline for submitting a report to SBSTA, this failed to materialise. Fortunately a last minute breakthrough did arrive before the closing plenary session of the SBSTA on 15 November, with conclusions adopted on how the drafting of the rules and procedures of the mechanisms in Article 6 should now progress. This means that work can commence on the drafting of informal documents containing the elements for the rules of the mechanisms in advance of the next SBSTA meeting in May 2018. While this keeps progress on track for COP24 in Poland in 2018, much work remains to be done on these mechanisms - the devil will be very much in the detail.
Notwithstanding Governor Brown's lament of the inadequacy of action, there remain many positive signs. At the same presentation where Governor Brown made his remark, China's top climate official, Xie Zhenhua, announced that preparations for China's national carbon market had been finalised and was now waiting on a final decision by the national government to implement the scheme. The day before, Lord Stern predicted that China's emissions would peak much earlier than 2030 (the date specified in its NDC), perhaps as early as 2021-2.
The current COP Presidency has also not lost sight of the bigger challenge. Fiji has initiated at COP23 what it calls the Talanoa dialogue - a respectful and cooperative process for countries to discuss how they can strengthen their individual emissions reduction targets to get closer to the Paris target. The Talanoa dialogue is intended to leverage off the facilitative dialogue for the global stocktake in 2018 of the commitments made in the parties' NDCs, and provide an inclusive framework for discussions before COP24 in Poland. The success of the Talanoa dialogue may well determine whether the world can move beyond baby steps in taking action to avoid dangerous climate change impacts.
Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this bulletin. Persons listed may not be admitted in all states and territories.