Paula Castro

AOSIS in the UNFCCC negotiations: from unity to fragmentation?

Small island states have been able to obtain some remarkable achievements in the climate change negotiations by building a cohesive coalition, the Alliance of Small Island States (AOSIS). Its cohesion, however, has been affected by changes in the UNFCCC process. The increase both in the number of issues on the climate agenda and the number of negotiation groups may have helped or hindered compromise and finding common ground. To track how AOSIS has fared in the climate change regime, the activities and positions of AOSIS, and of individual AOSIS members over three distinct periods (1995–2000, 2001–2005, 2006–2011) in the climate change regime, are compared. It is found that group activity has declined in relative terms and although there is overall agreement regarding mitigation and adaptation, there is less consensus regarding forestry (e.g. LULUCF and REDD) issues. However, despite controversies in some areas, AOSIS has remained a tightly coordinated and cohesive alliance that continues to be a key player in global climate policy.

Would preferential access measures be sufficient to overcome current barriers to CDM projects in least developed countries

Financial support for Clean Development Mechanism (CDM) projects in under-represented host countries was agreed on at the 2009 Copenhagen climate conference. The EU rules include special import quotas for certified emission reductions (CERs) from least developed countries (LDCs). This paper discusses whether these measures can contribute to overcoming barriers to CDM development in LDCs, how programmes of activities (PoAs) are performing and how CDM projects and PoAs contribute to sustainable development (SD) in LDCs. CER supply and demand scenarios for 2013–2020 show that preferential access measures for LDCs would not have an important impact on CDM in these countries if the barriers for project implementation are not overcome. The specific CDM projects and PoAs found in LDCs yield potentially high SD benefits. Through a comparison between the climate regime and the Lomé Convention, a preferential access agreement in agricultural trade, we conclude that not just preferential access is important, but also reduced access costs and the removal of underlying barriers. Increased incentives for added-value products characterize Lomés success stories. For the climate regime, this could be translated into additional financial incentives for CDM projects with added value. As LDCs host a high share of them, PoAs could constitute an opportunity here.

Climate Change Mitigation in Developing Countries

In this groundbreaking book, Paula Castro presents the first systematic categorization of positive and negative incentives generated by the Clean Development Mechanism (CDM) for climate change mitigation in the Global South.

Climate Change Mitigation in Advanced Developing Countries: Empirical Analysis of the Low-Hanging Fruit Issue in the Current CDM

Under the Kyoto Protocol, developing countries can voluntarily participate in climate change mitigation through the Clean Development Mechanism (CDM), where emission reduction credits from projects in developing countries are bought by industrialized countries to meet their own commitments. Before its implementation, developing-country experts opposed the CDM, arguing that it would sell off their countries’ cheapest emission reduction options and force them to invest in more expensive measures to meet their future reduction targets. This paper analyzes this “low-hanging fruit” argument empirically. CDM projects’ emissions abatement costs and potentials are estimated for different technologies in eight countries, using capital budgeting tools and the information from the projects’ documentation. Through a comparison with theoretical marginal abatement cost curves, we discuss whether the low-hanging fruit argument holds. We find that the CDM is not yet capturing a large portion of the identified abatement potential in most countries. While the costs of most emissions reduction opportunities grasped lie below the average credit price, there is still plenty of low-cost opportunities available. Mexico and Argentina appear to use the CDM exclusively for harvesting the low-hanging fruit, whereas in the other countries analyzed more expensive projects are also accessing the CDM. This evidence challenges the low-hanging fruit claim.

Does the CDM discourage emission reduction targets in advanced developing countries

Under the Kyoto Protocol, developing countries can voluntarily participate in climate change mitigation through the Clean Development Mechanism (CDM), in which industrialized countries, in order to meet their mitigation commitments, can buy emission reduction credits from projects in developing countries. Before its implementation, developing-country experts opposed the CDM, arguing that it would sell-off their countries’ cheapest emission reduction options and force them to invest in more expensive measures to meet their future reduction targets. This ‘low-hanging fruit’ argument is analysed empirically by comparing marginal abatement cost curves. Emissions abatement costs and potentials for CDM projects are estimated for different technologies in eight countries, using capital budgeting tools and information from project documentation. It is found that the CDM is not yet capturing a large portion of the identified abatement potential in most countries. Although the costs of most emissions reduction opportunities grasped are below the average credit price, there are still plenty of available low-cost opportunities. Mexico and Argentina appear to use the CDM predominantly for harvesting the low-hanging fruit, whereas in the other countries more expensive projects are accessing the CDM. This evidence at first sight challenges the low-hanging fruit claim, but needs to be understood in the light of the barriers for the adoption of low-cost abatement options.

Renewable energy deployment at the interplay between support policies and fossil fuel subsidies: Carbon Taxes, Energy Subsidies and Smart Instrument Mixes

This chapter aims to provide empirical evidence that fossil fuel subsidies present a considerable barrier to the deployment of renewable energy, even in the presence of policies that also subsidize or otherwise support renewables. The empirical relationship is analysed using the example of electricity, by modelling the determinants of electricity generation from non-hydro renewable energy sources, using a large cross-country dataset covering the time period from 2003 to 2013. As non-hydro renewables participation has been zero in many (low-income) countries until very recently, we estimate two-part models. This involves panel binary regressions in the first part to model the probability that a positive amount of electricity from renewables is produced. In the second part, we apply linear panel models to estimate the expected share of renewables, given that it is positive. We found that the likelihood that a country produces any electricity from renewables at all is positively related to the existence of policies that support renewables deployment, but does not seem to be related to fossil fuel subsidies. In cases where countries already produce grid-based electricity from renewable sources, we find significant evidence between-country effects for fossil fuel subsidies and financial support policies. Hence there are indications that the contribution of non-conventional renewables to electricity generation is negatively related to higher than average per capita levels of fossil fuel subsidies but despite this, financial support policies do make a positive difference in cross-country comparisons of renewable electricity shares.

Buying support at international negotiations: the strategic use of climate aid

The relationship between aid and voting in UN agencies has been well documented in the aid literature. We extend this analysis to the wider field of international negotiations, outside the sphere of formal voting, where decisions are mostly taken by consensus. Is aid used strategically to influence the negotiations in this context, too? Based on a novel dataset on negotiation behavior under the UN Framework Convention on Climate Change we assess whether countries obtaining aid react by expressing increased support and/or reduced opposition towards the donor. Applying linear and instrumental variable regressions on a three-dimensional panel dataset with donor-recipient dyads for the period 2002-2013 enables us to distinguish between long-term partnerships and the strategic use of aid for the purpose of the negotiations. We find that aid can indeed buy support in the climate negotiations, but that this opportunity tends to be limited to mitigation and adaptation aid, rather than general aid. We argue that this is due to both greater demand for and greater supply of these specific types of aid, whose allocation is under the direct responsibility of the specialized delegates participating in the negotiations.

Who dances with whom? A quantitative and qualitative analysis of interest groups characteristics, access to state actors, and negotiation outcomes

Existing work in the area of multilateral environmental agreements has found that, on the international level, the amount of influence exerted by interest groups depends on these groups’ level of activity during negotiations, the amount of groups present at the negotiations, and the interaction between these two factors. However, since in climate change negotiations interest groups do not have decision-making power, any influence exerted must be achieved by interaction with state actors. Using a two-level framework, we hence argue that certain interest groups work together with state actors at the national level, so that their positions are already similar when they are stated at the international level. While there is some qualitative work suggesting the importance of interest group and state interaction, there still exists no quantitative study that systematically examines which interest group characteristics ultimately promote access to state actors. Furthermore, the actual extent of influence exerted by interest groups on the final negotiation outcome has not been studied in the climate change negotiation context. To contribute to this research gap, this article first analyses what interest group characteristics make them gain access to state actors, and then explores the extent of actual influence these groups achieve on negotiation outcomes. We analyze written submissions to the UNFCCC on Carbon Capture and Storage (CCS) technology to determine interest group and state positions, relying on the keyword-based software Wordfish, and use closeness of positions as a proxy for access to state actors. We then run multivariate regressions to test, which interest group features determine such access. In addition, to examine to what extent the interest groups were actually able to influence the negotiation outcomes, we trace the amount and content of text provided by interest groups in their written submissions that is taken up in country submissions and in the final decision text, with the help of the plagiarism software WCopyfind. Our descriptive and econometric analysis show that interest groups do have a discernable influence on country positions during the climate change negotiations.