Climate Finance at COP18: Assessing new US and UK commitments

The original paper is here

The original press release is here

The contacts for interview are: David Ciplet (david_ciplet@brown.edu +1 510 846-5020), Timmons Roberts (j_timmons_roberts@brown.edu +1 401-441-2103), Saleemul Huq (saleemul.huq@iied.org)

IIED fast-start finance addendum:

Climate Finance: Assessing new commitments of United States and United Kingdom

28 November 2012

This addendum to the briefing, Eight unmet promises of fast-start climate finance (see press release here) assesses newly announced fast-start finance commitments for 2010-2012 provided by the United States Department of State and the United Kingdom Department for International Development. These figures were provided after the briefing had already gone to press. These two new figures raise the sum of committed fast-start finance to US$25.9 billion of the US$30 billion pledged in Copenhagen in 2009.[1]

Fast Start climate finance was a collective commitment, but the core principle of the UN Framework Convention on Climate Change is that Parties should address the problem according to their “common but differentiated responsibilities and respective capabilities” (CBDR+RC).  We set out to estimate what each contributor owed, based on their responsibility for climate change (the past half century of cumulative emissions, representing CBDR) and their Gross Domestic Product (representing RC).  Both sets of data are derived from the World Bank website.  We here provide both indicators separately, and a combined fair share percentage (the average of the two), for readers to evaluate performance based upon the “burden sharing principle” they endorse.  Our position is that both are parts of the Convention, and so both should be considered.

The United States: The United States has now committed US$7.5 billion in fast start finance for 2010-2012. This includes US$4.7 in Congressionally-appropriated funds that qualify as Official Development Assistance (ODA), as well as US$2.7 billion from United States development finance and export credit agencies with missions to help American businesses expand into international markets. Even with the new commitments, the United States has committed less than two-thirds (62%) of the money that it should provide, based on its role as a climate polluter and the size of its economy. This is what we call its “fair share” commitment, which we calculate should be US$12.1 billion of the total US$ 30 billion.  However, if one counts only what qualifies as ODA, the United States is providing well under half of its fair share, at 39 percent. The United States has committed 19 percent of its funds for adaptation; 2 percent of its funds to the United Nations climate funds; and 63 percent of its funds as grants.

The United Kingdom: The United Kingdom has now committed US$2.4 billion (GBP 1.5 billion) in fast start finance for 2010-2012.  This funding appears to all qualify as ODA, but the proportion delivered as loans is not clear from the new report.  With this new funding, the UK has provided 143% of its fair share, when considering responsibility for the problem of climate change, and financial capability.  One-third (33%) is allocated for projects and programmes assisting developing countries to adapt to climate change. Only 2.7 percent has been channelled through United Nations climate funds such as the Adaptation Fund, the Least Developed Countries Fund, and the Special Climate Change Fund.  The UK gave two thirds of its overall FSF funding through multilateral channels, especially the World Bank administered Climate Investment Funds (CIFs).     

[1] As specified in the briefing, “Actors including the European Union, United States, Canada and New Zealand have indicated that they will make additional fast start contributions by the end of the period.” In particular, our report specified that, “Three countries have proposed specific additional contributions to be made by the end of the period: the EU US$3.6 billion; Canada US$235 million; and New Zealand US$48.8 million.” But these actors had yet to commit these funds and thus are not included in the total fast-start figure at this time.

Addendum Table: Final US and UK fast start finance figures, updated 28 November 2012

*Responsibility score is based on cumulative emissions of CO2 from 1960-2008, the latest year official data is available.  Sources: World Bank website.

** This figure has been provided by the US as an upper end estimate, but it has yet to be decided