COP 28

The fox is in charge of the chicken coop with leadership to some extent it seems, and finance will undoubtedly be a big issue again, but we want to hope for the best as COP 28 opens up Nov 30 in UAE, as arguably a more crucial session than ever before. The Pope will present! I like the work of Sharpe and Lenton.  We can’t continue to just analyze climate problems without a complex systems approach to solutions and their focus on tipping points seems promising.  Here are a few links.

Also see Simon Sharpe & Timothy M. Lenton  (2021)  “Upward-scaling tipping cascades to meet climate goals: plausible grounds for hope.”  Climate Policy,   21:4,   421-433,   DOI: 10.1080/14693062.2020.1870097      Abstract:  Limiting global warming to well below 2°C requires a dramatic acceleration of decarbonization to reduce net anthropogenic greenhouse gas emissions to zero around mid-century. In complex systems – including human societies – tipping points can occur, in which a small perturbation transforms a system. Crucially, activating one tipping point can increase the likelihood of triggering another at a larger scale, and so on. Here, we show how such upward-scaling tipping cascades could accelerate progress in tackling climate change. We focus on two sectors – light road transport and power – where tipping points have already been triggered by policy interventions at individual nation scales. We show how positive-sum cooperation, between small coalitions of jurisdictions and their policymakers, could lead to global changes in the economy and emissions. The aim of activating tipping points and tipping cascades is a particular application of systems thinking. It represents a different starting point for policy to the theory of welfare economics, one that can be useful when the priority is to achieve dynamic rather than allocative efficiency.

Key policy insights

  • Pricing policies and targeted investments that bring clean technologies below the threshold of cost-parity with fossil fuel technologies can trigger reinforcing feedbacks that cascade up scales to propel disproportionately rapid decarbonization.
  • Traditional approaches to climate policy based on welfare economics principles of minimizing marginal abatement costs, and pricing externalities, are likely to miss these opportunities. Systems thinking can help identify ways for policy to drive effective change.
  • Positive-sum cooperation between small groups of countries can accelerate the activation of tipping points in the global economy, facilitating decarbonization in all countries. Early opportunities for this are in the power and light road transport sectors, where clean technologies are increasingly competitive with fossil fuels.
  • The value of decarbonization policies should be judged not just on their immediate effects on emissions within the implementing jurisdiction, but also for their potential to contribute to upward-scaling tipping cascades in the global economy.

The latest UN Adaptation Report focuses heavily on finance, and think of this in the context of the US plan to spend $1.5 trillion to build up our nuclear arsenal:

The report – which looks at progress in planning, financing and implementing adaptation actions – finds that the adaptation finance needs of developing countries are 10-18 times as big as international public finance flows. This is over 50 per cent higher than the previous range estimate.  The modeled costs of adaptation in developing countries are estimated at US$215 billion per year this decade. The adaptation finance needed to implement domestic adaptation priorities is estimated at US$387 billion per year.  Despite these needs, public multilateral and bilateral adaptation finance flows to developing countries declined by 15 per cent to US$21 billion in 2021. As a result of the growing adaptation finance needs and faltering flows, the current adaptation finance gap is now estimated at US$194-366 billion per year. At the same time, adaptation planning and implementation appear to be plateauing. This failure to adapt has massive implications for losses and damages, particularly for the most vulnerable.  This report identifies seven ways to increase financing, including through domestic expenditure and international and private sector finance. Additional avenues include remittances, increasing and tailoring finance to Small and Medium Enterprises and a reform of the global financial architecture. The new Loss and Damage fund will also need to move towards more innovative financing mechanisms to reach the necessary scale of investment.

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