By Narek Mirzoyan
Recent years have seen an increasing focus on greenhouse gases. This phenomenon influenced our climate and we can both see and feel the effects of climate change in our global environment. There is an increasing global response to this being proposed by different countries that understand the necessity to work together for environmental and sustainable economic development. The proof of this is the Rio Earth Summit in 1992, the Kyoto Protocol in 1997 and the Paris Agreement on climate change in 2015.
Acknowledging that climate change is a common concern of humankind means that young people are not an exception and should address climate change when taking actions. By this we will not only protect ourselves but also will promote and be considered an example for others too. A youth forum on ecology, recently organised in Saint Petersburg, showed how young people are united and concerned about climate change. During the forum there were several discussions by young people from Italy, Armenia, Germany, Russia, Serbia, Slovakia, Kazakhstan, France and others with the purpose of proposing a shared environmental policy to tackle climate change.
For the protection of the environment young people affirmed the importance of education, training, forums creating public awareness, participation and access to information and cooperation at all levels on matters of climate change. Moreover, during the forum the Paris Agreement on climate change discussed which participants felt there are more advantages than disadvantages to the agreement, in particular, the following advantages were mentioned:
- Paris Climate Agreement creates hope that a fundamental and rapid energy transition is achievable;
- Paris Agreement is an inspirational accord that will trigger and legitimize more climate action in the world;
- Paris Climate Agreement is trying to find an effective way to completely decarbonise the world economy;
- Any agreement on climate change is better than no agreement at all.
In addition, the participants had a chance to discuss the challenges of the Paris Climate Agreement implementation process, which global market mechanisms can be worked out in order to stimulate a low carbon development process which includes:
- A tax on transporting goods;
- Carbon tax on company production processes;
- Creation of global environmental standards for factories, companies, power plants;
- Halting investments into the fossil fuel sector by applying a global tax on investments into the fossil fuel sector which can be used for helping developing countries implement renewable energy instead of using fossil fuels.
Climate finance is vital for effectively addressing climate change through adaptation and mitigation activities. To reorient the global energy system to one that is consistent with the 2°C goal, $25 trillion are required from 2015 to 2030. Therefore, climate finance needs to be significantly scaled up from $391 billion to $1.6 trillion per year. Up to date, climate finance on mitigation accounts for 93% of total climate finance, while adaptation activities receive only 7% of available global climate finance. To increase climate finance flows, strategies should be taken to scale up public funds, integrate climate consideration to financial systems, provide sufficient incentives and inducement while increasing investment opportunities and reducing risks for private actors.
Therefore, the participants proposed the following:
1) Climate finance from public sources (which currently accounts for 38% of all international climate finance) should be significantly scaled up. This can include opportunities at the local or national level but also international funds like the Green Climate Fund.
2) Next to public funds, climate finance from private sources also needs to be increased. To provide incentives for companies and private individuals to consider mitigation mechanisms in their investments and thereby prioritise sustainable projects, the participants called all banks and credit institutes to include a climate change risk assessment when assessing the creditworthiness of projects. Through mainstreaming climate change considerations into the financial system, climate-friendly projects and investments would appear more desirable to entrepreneurs, managers, and stakeholders. It should be discussed, whether a climate change risk assessment could and should be made mandatory for investment projects (of a specific size).
3) To ensure that governments and private investors have an incentive to get involved in climate finance, a (national) transparency and accountability system must be put in place, which enables a tracking of climate finance and an effective monitoring of the results and impacts. Thereby, the level of trust in climate finance increases and investing in climate-friendly projects become more attractive.
4) Indirectly, climate finance could easily be improved by removing all preserve subsidies, which represent subsidies for fossil fuels, energy-intensive industries, or other climate-damaging projects. To date, perverse subsidies cost the world $500 to $600 billion annually (according to the IMF), which could instead be spend on projects for mitigation, adaptation or transferring economies from fossil-fuel-intense to carbon-neutral strategies. Participants called for removing all perverse subsidies.
5) To scale-up climate finance in developing countries and emerging economies, social investment and micro-financing should be considered as strategies to empower the local population to prefer sustainable, climate-friendly solutions and at the same time offer opportunities for economic and social development.
While all the proposals above are pre-requisites for increasing climate finance as well creating a balance between adaptation and mitigation. The participants specifically proposed the following to scale-up adaptation funding:
6) While adaptation funding in itself — different to mitigation funding — is not profitable for countries as such, they believed, that regulations have to be created for governments and companies which demand a specific level of funding for adaptation projects to be guaranteed.
Governments could be mandated to pledge a certain amount annually for adaptation funding in international or regional agreements like the Paris Agreement or the EU Strategy on Climate Change. Companies in contrast could be required to provide a pre-determined sum for a national adaptation fund, whenever they want to invest into countries, which suffer from negative consequences of climate change. The respective national government would have full control about how the money from the adaptation fund will be spent but needs to ensure a level of transparency and accountability by showing that the money is spent on the most effective adaptation projects.
Featured image by Nattu (Flickr/Creative Commons)