COP27: Biden’s new initiatives, PNG signs carbon deal

(November 10, 2022) Pacific nations share carbon market experiences at COP27.

America has reassured Pacific and world leaders who are fighting for a 1.5 to Stay Alive outcome at COP27 in Egypt, of its commitment and renewed leadership to avert “climate hell.”

President, Joe Biden, highlighted his nation’s efforts to reduce emissions, advance the global climate fight and help the most vulnerable build resilience to climate impacts, during a special ticket only session at Plenary Nefertiti at the Sharm El-Sheikh International Congress Centre on Friday.

“We’re not ignoring the harbingers that are already here. It’s true so many disasters — the climate crisis is hitting hardest those countries and communities that have the fewest resources to respond and to recover,” he said. 

To prove its commitment to the cause, President Biden announced the following initiatives:

Bolstering Global Climate Resilience – including doubling the U.S. pledge to the Adaptation Fund to $100 million and announcing over $150 million in new support to accelerate the President’s Emergency Plan for Adaptation and Resilience (PREPARE) efforts across Africa.  These build on the over $20 million that President Biden has announced this year to accelerate PREPARE’s work in Small Island Developing States.

Accelerating Global Climate Action – including launching a new initiative to support Egypt in deploying 10 GW of new wind and solar energy while decommissioning five GW of inefficient natural gas generation, strengthening proposed domestic methane regulations in the oil and gas sector that would reduce U.S. methane from covered sources by 87 percent below 2005 levels as well as other domestic and international action to tackle methane emissions and advance the Global Methane Pledge, and announcing new actions that would make the United States the first national government to require major suppliers to set Paris Agreement-aligned emissions reduction goals – leveraging the Federal Government’s over $630 billion in annual purchasing power.

Catalysing Investment at The Scale Required to Tackle the Climate Crisis – including launching new and innovative approaches that strategically use public finance to unlock billions in private investment, such as the “Climate Finance +” initiative that will support developing countries in issuing green bonds; launching the Sustainable Banking Alliance to deepen developing countries’ sustainable financial markets; and making strategic investments that help to mobilise billions in private finance and facilitate the export of U.S. clean technologies.

Engaging All of Society in Tackling the Climate Crisis – including launching a Climate Gender Equity Fund, an Indigenous Peoples Finance Access Facility, and new exchanges to empower youth across the world to be leaders on resilience and clean energy in their communities.

However, Pacific climate activists have challenged the United States’ assertion at COP27 that it is a ‘global climate leader’. executive director May Boeve said to be a true global climate leader, the US needs to own their responsibility and pay up what is owed for adaptation, stop funding fossil fuel projects, and commit to real and significant investments in loss and damage in support of the most vulnerable nations. Pacific Managing Director Joseph Sikulu said keeping global heating below 1.5 degrees Celsius is non-negotiable for the Pacific.

“We refuse to let up the pressure on global leaders at COP27 because this is a matter of survival for our islands. Our Pacific negotiators going into (this) week’s ministerials (meetings) are fighting an uphill battle against Goliath nations that are stalling for time and continuing to block the climate action needed for our survival.

PNG signs blue carbon deal

Meanwhile, Papua New Guinea has inked its blue-carbon deal with Dubai as the COP27 in Egypt winds down with recommendations for more than 100 countries.

The deal is to design and develop a framework and strategy to regulate carbon markets for PNG.

Papua New Guinea has entrusted its carbon regulation framework to Blue Carbon, a Dubai-based company commenced under the vision of Sheikh Ahmed Dalmook Al Maktoum to support carbon removal projects across the world.

The PNG move follows a series of government bans and moratoriums imposed on carbon projects in the southwestern Pacific nation.

Signed between Don Polye, Minister of Higher Education, Research, Science & Technology and Sports of PNG, and Sheikh Ahmed Dalmook Al Maktoum, chairman of Blue Carbon, the partnership aims to develop framework and strategies to regulate carbon markets through transparency audits for high intensity carbon emissions in PNG.

Under the agreement, Blue Carbon will mobilise resources for rehabilitation and conservation of existing forests in PNG. The company will also conduct preliminary research, feasibility studies, develop Emission Reduction Purchase Agreements (ERPA) and secure investment financing for the project.

Pacific nations on carbon markets

Palau and other Pacific leaders reiterated the importance of carbon markets at a COP27 side-event in Sharm El-Sheikh.

Palau’s Minister of Agriculture, Fisheries and Environment, Steven Victor, said estimates have placed the potential savings from a globally integrated carbon market, under Article 6 of the UNFCCC, as high as hundreds of billions of dollars every year.

This money, he said, could be funnelled into additional emission reductions, further raising ambition and providing support for adaptation.

“Many see carbon markets as key to channelling billions of dollars into reducing emissions. In 2021, the value of carbon credits traded on the voluntary market, for instance, exceeded US$1 billion, more than double the value in 2020. It is expected that this figure will grow exponentially in the coming years,” Victor said.

He said Article 6 could also provide a means of incorporating climate commitments by the private sector into the UNFCCC process and improve trading arrangements to ensure that environmental integrity is prioritised.

“Significantly, the operation of Article 6 can be a source of climate finance for mitigation and adaptation in developing nations, while helping to contribute to their sustainable development efforts,” he said. “As players in this space the onus is on us to ensure that the rules governing markets are further refined to focus on improved oversight and accountability, so as to foster trust and confidence in markets as a viable means to deliver global emissions reductions.”

Speaking about Fiji’s experience, Daniel Lund said the issue continues to evolve and there are a number of moving parts which negotiators must be on top of in order for Pacific nations to benefit.

“When Fiji started ten years ago, it was a very different landscape,” he said.  “We were looking at markets from the perspective of reducing deforestation and its drivers, which are often linked to climate change. We have communities that when hit by a cyclone event, find themselves with limited resources.

“To deal with the damages and costs they incur, one of the first places they go is the forest. They engage in logging to create new income, so there is a linkage between the drivers of this vulnerability and climate change as well as the further pressures of extraction on the environment.”

“You need to look at pricing as an incentive to reduce pressures on the environment. Now, we are looking at the broader scope of nature-based solutions as well as the ability to use markets as a means for additional financing for energy transition,” says Lund.