UK: No New Funding for Coal-Fired Power Stations Abroad

By Fiona Harveyand John Vidal, The Guardian

British taxpayers' money will no longer be used to build coal-fired power stations in developing countries, the energy secretary Ed Davey pledged on Wednesday, as the fortnight-long United Nations climate talks entered their final phase.

The U.S., which provided $9 billion over the same period to coal power and mines, and several European countries have also pledged to provide no more aid to building new coal plants.
Credit: Flickr/Nikolaj F. Rasmussen

The UK has provided about $500 million for such projects in the past seven years, mostly through its funding for development banks, according to research by the U.S. Natural Resources Defense Council. Ending that is meant to encourage countries to move to low-carbon energy.

Davey said: “It is completely illogical for countries such as the UK and the U.S. to be decarbonizing our energy sectors while paying for coal-fired power plants to be built in other countries. It undermines global efforts to prevent dangerous climate change and stores up a future financial time bomb for those countries [where they are built].”

The U.S., which provided $9 billion over the same period to coal power and mines, and several European countries have also pledged to provide no more aid to building new coal plants. But Germany and Japan, two of the biggest funders of coal, at $6 billion and $9 billion respectively, have not yet joined in.

Davey also launched a new initiative, with the U.S. and Norway, aimed at preserving the world's forests through a $280 million fund to help countries move to sustainable agriculture, which was welcomed by green campaigners. This money is not new, however, but diverted from existing climate funds. Davey said the novel aspect of the initiative was collaborating with private sector companies to create a market for sustainably produced goods, including food, fiber and timber.

But the troubled climate talks became yet more fractious on Wednesday, the first day in which ministers have taken part, as developing countries and rich governments wrangled over whether finance should be provided to vulnerable nations to deal with the impacts of extreme weather, such as the Haiyan typhoon that devastated the Philippines. The debate over “loss and damage” from climate change is one of the most contentious at the negotiations, and could derail progress on reaching a global deal on greenhouse gas emissions in Paris in 2015, for which this fortnight-long meeting is supposed to lay the groundwork.

Talks on loss and damage went on in a small working group until 4 am on Wednesday, ending with developing countries dissatisfied with the proposals put forward. Some characterized the meeting as a “walk out” by the G77 group of developing nations but others said it was an adjournment because of the late hour, and all participants were back at the table when the working group resumed.

Davey also launched a new initiative, with the U.S. and Norway, aimed at preserving the world's forests through a $280 million fund to help countries move to sustainable agriculture.
Credit: Jenny Bate via The Guardian

Loss and damage is controversial because some countries want to use it as “compensation” from rich countries, which have had high emissions historically, to the poor world. Developed countries will not agree to that, in part because the legal implications of accepting liability and paying reparations could result in claims for hundreds of billions of pounds.

Saleemul Huq, senior fellow at the International Institute for Environment and Development, said: “Think of the vast damage that an extreme such as superstorm Sandy can cause, or consider the certainty that some low-lying land will be forever submerged beneath rising seas. In such cases, loss and damage carries both human and economic costs. While the human costs can never be repaid, the economic ones can. The question is: who should pay?”

Connie Hedegaard, the EU's climate chief, said: “We cannot have a system where we have automatic compensation when severe events happen around the world. That is not feasible.”

Instead, rich countries want to link any mechanism for accounting for “loss and damage” to the existing provision for developing countries to adapt to the effects of climate change, for instance by building sea defenses and early warning systems for storms. Rich countries have pledged that $100 billion a year will be available for that, and for helping poor countries move to a low-carbon economy, by 2020, most of it coming from private sector sources.

They also dispute claims that they should bear the whole weight of historical responsibility for climate change, noting that China is now the world's biggest emitter and second biggest economy, with other emerging economies such as India catching up rapidly. Carbon dioxide emissions from these economies have risen so fast, while those of rich countries have fallen, that by 2020 the cumulative emissions of developing countries will overtake the century's worth of carbon poured out by the developed world.

That would be a landmark turnaround in the long-running debate over historical responsibility. But, China is not being called on to make “loss and damage” funding available to poorer nations.

Reprinted from The Guardian with permission.