Reframing adaptation finance

CLIMATE Finance (CF) stands at the core of UNFCCC negotiations for mitigation, adaptation, tech transfer and capacity building. But there is little progress yet from what was there in the fast start finance (FSF) during 2010-2012.  With so many question marks over donor community's claim of delivering around $33 billion, there was at least something on the table. Since then, there has been no progress on long term finance of pledged $100 billion a year by 2020. Now discussion focuses rather on capitalisation of the Green Climate Fund (GCF). This was the backdrop of both meetings in Lima and Paris, where the main focus was on CF mobilisation. The UN Summit meeting resulted in pledges of $2.3 billion, mainly from France, Germany, against a goal of at least $15 billion. The meetings in Lima and Paris deliberated more on how to mobilise private finance for addressing climate change, particularly for mitigation. This author was invited by the OECD, the rich men's club in Paris, to hear from a poor and innocent victim of climate impacts on International Adaptation and its Financing.  

Needs for Adaptation Finance: The latest Consolidated estimates of financial needs for adaptation shows a range of $100 billion to $450 billion a year until 2030. National adaptation plans (NAP) are the main vehicle for developing countries for comprehensive planning and needs assessments, and taking the 20C limit as a common reference would make adaptation cost estimates more specific.

Reality in Adaptation Finance: In the Lima and Paris discussions there was a consensus that adaptation in the PVCs must be led by public funding. Some sources claim that in 2013 a sum of $359 billion was available from different sources as CF, out of which $22 billion went for adaptation. But there was actual delivery of about $500 million by the three climate regime funds, plus by the Pilot Program on Climate Resilience under the World Bank and the EU-led Global Climate Change Alliance. This amount stands as one- sixth of the pledged amount of total $ 3billion by the five funding mechanisms. More tragic is that only 18% of the FSF was allocated for adaptation and only 16% of it went to the PVCs, though share of some donors in adaptation financing is much higher.

There was heated debate over ODA repackaged mostly as adaptation finance in the FSF tranche. From common sense perspective, this may be right, since adaptation often cannot be differentiated from development, but from policy point of view, CF as a responsibility-capability based instrument (Article 3.1 of the UNFCCC) is blurred with ODA, which is voluntary and charity-based. It is interesting to note that while CF goes up, ODA goes down. So, my proposal in the negotiations was that generation of ODA and CF should be kept separate, but at utilisation point in the PVCs, the two pots can be mixed.

How to upscale adaptation? Against this continued imbalance in adaptation funding, regarded as the 'poor cousin' of mitigation, discussions began at the Ad-hoc Working Group on Durban Platform (ADP) about establishing a global goal for adaptation, to ensure balance in funding with mitigation. The argument is that mitigation and adaptation need to be addressed in the context of the agreed 2°C limit, in accordance with Article 2 of the Convention. However, largely two schools of thought emerged from the deliberations:

•      A global goal for adaptation to be established as a function of mitigation, which would determine the need for finance under different T0 scenarios. Thus, the support needed for NAPs is to be defined ex-ante (quantitative goal).
•      A goal to be defined as the agreed commitment to ensure resilience to the adverse effects of CC by integrating adaptation into policies/programmes and build capacity accordingly (qualitative goal). In fact, the two strands are complementary and the 2015 regime should reflect that way.  

However, without adequate financing, neither approach can be materialised. Instead of the current voluntary basis of generating CF, there have long been proposals of some 'auto-generation' mechanisms, such as levies on emission-intensive activities in mobilising international public finance. But no consensus is there yet. A new instrument of mobilising adaptation finance could be a scheme that would charge major emitters for exceeding their reduction commitments under the 2015 regime and transfer the money toward adaptation support.

In fact, adaptation suffers from some conceptual lacuna, embedded in Article 3.3 of the UNFCCC, stipulating for global benefits from adopted measures. My recent book, Toward a Binding Climate Change Adaptation Regime: A Proposed Framework (London: Routledge, 2014), attempts a reframing of adaptation as a Global Public Good (GPG) in an era of 'global commons' problems. There is universal consensus that mitigation, being a GPG, is the responsibility of each and every UNFCCC Party. This was reflected in the Durban Platform adopted at COP17 in 2011 for reaching a universal regime. Disagreement in negotiations persists in cost-sharing over mitigation. But no country challenges the rationale and compulsive need for global cooperation to address the 'cause' part of climate change through mitigation as a GPG.  

Adaptation suffers from some conceptual lacuna, embedded in Article 3.3 of the UNFCCC, stipulating for global benefits from adopted measures.  While there is universal consensus about mitigation as a GPG, its undersupply resulting in climate change impacts are not regarded as a public public bad, and hence adaptation as a GPG. My recent Book: Toward a Binding Climate Change Adaptation Regime: A Proposed Framework  (London: Routledge, 2014) attempts a reframing of adaptation as a GPG, citing numerous examples of adaptation bringing in many direct and indirect global benefits in an era of `global commons' problems.

But the 'effect/impact' part of the problem, which results from under supply of mitigation is discriminated, in not recognising as a global public bad. So, why should adaptation in combating impacts not be regarded as a GPG? Now adaptation is viewed as supplying only local or national public good. This narrow conceptualisation of adaptation, framed under a territorially bounded nation state system, needs a reframing for addressing a global common problem like atmospheric sink capacity. So, philosopher Gardiner rightly argues that climate change presents a 'perfect moral storm' condemning the causers of the problem to a 'moral corruption.'    

LDC negotiators should lead this reframing process, to strengthen its legal basis that adaptation brings in real and sustainable GPG, and building climate-resilient societies across the PVCs are of mutual benefit, both to industrial and developing worlds. With a trans-disciplinary frame-bridging and band-wagoning, the book brought in few levers and instruments for an expanded interpretation of adaptation as a GPG. Unless this recognition can be achieved, adaptation finance is likely to remain poor.

The writer is Professor, North South University.
E-mail: mizanrk@northsouth.edu