Cash raised by shipping industry may help fund climate initiatives
Proposed revenues would be used to compensate developing countries for slightly higher import costs, and contribute to the Green Climate Fund.
Tue, Dec 06 2011 at 6:43 AM
DURBAN, South Africa - Cash raised by the shipping industry's efforts to cut carbon emissions might be directed to developing countries to help them tackle climate change, a draft document seen by Reuters showed at United Nations climate talks on Tuesday.
The text proposes that money raised by "specific actions" to reduce emissions from maritime bunker fuels, which may be designed and implemented by the International Maritime Organization (IMO), could be distributed to developing countries and used to finance climate adaptation through a Green Climate Fund.
Negotiators will discuss the proposal later on Tuesday.
Several delegates at a U.N. climate summit in Durban doubted there would be agreement on the proposal. They said any final deal at the end of the week would be worded vaguely.
"I don't expect any clear outcome but if something stays in the text, it would be a big step in a small way," said Bas Eickhout, European Member of Parliament.
"Everything boils down to where is the money? I think that the entire financial decision is going to be a big deal in Rio," he added, referring to a U.N. conference on sustainable development in June next year.
Nearly 200 countries are meeting in Durban until Dec. 9 at a United Nations summit to try to hammer out a new global climate treaty.
The United Nations hopes delegates attending the global climate talks will agree on the design of the Green Climate Fund, which aims to channel up to $100 billion a year by 2020 to countries most at risk from the effects of climate change, such as rising sea levels and temperatures and crop failure.
Concrete progress on funding would help revive the flagging talks, hampered by rifts between countries on the form of a new global pact.
This is the first time a concrete source of funding has been raised in a U.N. text, but Tuesday's draft did not define whether revenues would be raised by a levy.
Last month, campaign groups Oxfam and WWF urged a carbon price of $25 per metric ton should be applied to shipping fuel (known as bunker fuel) to help cut emissions and generate $25 billion a year by 2020.
They suggested the revenues raised should be used to compensate developing countries for slightly higher import costs resulting from a carbon price, and to provide more than $10 billion per year for the Green Climate Fund.
"The text is vague on the details of implementation. If it's a levy, it could be collected directly from ships, or it could be collected from bunker fuel suppliers," said Tim Gore, policy advisor at Oxfam.
"If it's an emissions trading scheme, there could be a common auctioning platform, or each country could auction (carbon) allowances. All such details would be resolved subsequently in the IMO, if this text were agreed," he added.
International shipping accounts for around 3.3 percent of the world's man-made carbon dioxide emissions and could grow by 150 to 250 percent by 2050 if regulation is not in place.
The IMO has made little progress in implementing market-based mechanisms to control the sector's emissions, even though the EU Commission has threatened to include it in its carbon market.
In July, the IMO managed to agree on energy efficiency design standards for new ships to cut emissions, but developing countries can delay implementation by using a waiver.
(Additional reporting by Andrew Allan, Barbara Lewis and Michael Szabo; Editing by William Hardy)
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