The Durban climate talks have passed the halfway mark – and the scale of the task ahead is clear. More than 50 separate items are in the balance in two parallel negotiating tracks. We believe there is potential for a deal to be done, but this will require compromise from the two 'carbon giants' – the USA and China – which may be difficult to achieve.
The key task for the Durban climate conference is to deliver a roadmap for a comprehensive global deal – potentially by 2015 – which would be a six-year delay from the ill-fated Copenhagen summit (see Plan D for Durban). Achieving this boils down to three interlocking elements.
A Kyoto compromise
Agreeing a second commitment period to Kyoto starting in 2013 remains the touchstone of success for developing countries. The EU leads a diminished group of industrialised countries that are willing to accept new caps – although these would be consistent with existing targets.
What's still to be resolved is the length of the second commitment period (five years or eight years), the precise commitments, how it will come into force – and, crucially, the linkage with the broader 'roadmap to the future'. We expect a diplomatic fudge – with the Clean Development Mechanism limited to the poorest countries; CCS may be included, though issues over liability are likely to remain.
A roadmap to the future
A 143 page compendium of proposals has been put before negotiators covering a broader package of national targets, sectors (including agriculture) adaptation, finance, forests, trade, technology and reporting. This includes proposal for peaking global emissions between 2013 and 2020, stressing that industrialised countries should take the lead. But only countries in the former communist block, Japan and the European Union have so far peaked emissions. Underlying the major differences that remain are competing views of the destination of any 'roadmap' that might be agreed: a loose, open-ended mandate (favoured by the USA), an inclusive, time-bound mandate (desired by the EU and Alliance of Small Island States) and a traditional approach with clear differentiation between industrialised and emerging economies (promoted by India along with many developing countries). At this stage, the issues at stake are fundamentally geopolitical rather than technical or scientific.
Finding climate finance
One of the potential 'silver linings' of Durban is the finalisation of the Green Climate Fund (GCF) a new public finance vehicle designed to accelerate low-carbon growth and action on climate resilience in developing countries. It looks likely that a 'private sector facility' will be included and emphasis is being placed on the GCF deploying a suite of risk mitigation tools to mobilise private capital (such as policy risk insurance, first loss arrangements and guarantees for climate bonds). But even if it is launched, the GCF could become an 'empty shell' as austerity-hit governments in the OECD have made no new pledges for when 'fast start finance' expires at the end of 2012; furthermore, it could take a number of years to become operational.
Back to the future?
At this stage in the negotiations, two potential outcomes appear to be beginning to emerge. The first is a Copenhagen-style crisis, with a low-ambition result being driven by the USA and, perhaps, India. The second is a Bali-style breakthrough, with a convergence around an adjusted version of the EU's roadmap proposal, with Brazil and South Africa being the key bridging nations. The key swing state is China, with some indications that it might be willing to accept legally binding emission cuts as part of an overall package. A resolution is not expected until late Friday December 9.
Nick Robins is head of the Climate Change Centre at HSBC
This is an edited extract from the HSBC Global Report "Dispatches from Durban." Reproduced with permission