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INSIDER: 4 Key Topics Climate Negotiators Must Resolve by COP26

Despite the COVID-19 pandemic postponing COP26 until November 2021, UN negotiators were still hard at work this year. After a series of virtual events in June, more than 3,000 country delegates recently concluded the Climate Dialogues, a set of 80 virtual gatherings where countries unpacked, reviewed and discussed outstanding issues within ongoing international climate negotiations.

From the outset, countries agreed that the dialogues would not include the formal negotiations that normally take place at the COPs and that the dialogues would not lead to any official decisions. Rather, the dialogues included events that countries had previously mandated to take place in 2020 and other informal exchanges. The dialogues served as a platform for countries and non-state actors to take stock of overall progress on climate action made in 2020 and provided an informal space for negotiators to enhance their understanding of outstanding issues as they prepare to resume negotiations in 2021.

The Climate Dialogues provided a good avenue to maintain momentum on various issues, including those mandated by countries and those less politically sensitive. They were also crucial to foster effective and inclusive implementation of the Paris Agreement, including consideration of gender, indigenous peoples, capacity-building and climate action empowerment.

Some issues could make or break the negotiation outcomes of COP26. Here are four issues that require substantive technical work and political capital next year:

1. Finalizing the Rules of the Paris Agreement

By the end of COP26 next year, countries must work out the details of three areas within the rulebook of the Paris Agreement

Setting Common Timeframes for National Climate Commitments

Countries have not yet agreed on the common time frame that their 2025 NDCs, including their targets, will cover. During COP25 in Madrid, countries could not agree whether to synchronize their NDC targets with the established five-year ambition cycle by adopting the same NDC end date (which also determines the length of the implementation period). They also could not agree on when to make such a decision, as some argued there was no urgency. During the Climate Dialogues, countries continued exchanging views to better understand what factors could either prevent or enable the overdue decision. During the open event, countries expressed their desire to conclude these negotiations by COP26. 

Strengthening Transparency Requirements

A lot of work remains for negotiators to finalize the technical details of the Paris Agreement’s enhanced transparency framework, which aims to hold countries accountable for their climate commitments. Pending decisions include the details of the tables and formats countries will use to track and report their greenhouse gas emissions, climate action and support. During the nine hours allocated during the Climate Dialogues, negotiators struggled to identify potential compromises on approaches that can allow some flexibility while still securing robust accounting of countries’ efforts. Negotiators still need more time to grapple with the linkages between the Agreement’s transparency framework and provisions for the use of Article 6.

In addition, during the Climate Dialogues, 27 countries (10 developed and 17 developing) — including the European Union, Australia, China, Brazil, South Africa, Singapore, Indonesia, Colombia, Namibia and Côte d’Ivoire — had their individual climate efforts and progress toward their commitments scrutinized through peer exchanges processes called “multilateral assessment” for developed countries and “facilitative sharing of views.” This exchange was undertaken based on their recent transparency reports and following a technical expert reviews and analysis. During the sessions, countries shared their experiences fulfilling their transparency requirements and tracking progress toward their commitments; they also responded to written and verbal questions from other countries.

Determining How Carbon Markets (Article 6) Will Work

Outstanding negotiations related to Article 6, particularly on carbon markets, will continue to be a major focus. The UNFCCC hosted a number of informal closed dialogues in order to explore how countries could reach consensus. Given the failure to agree on decisions at COP25, the key issues from 2019 remain unresolved: how to avoid double-counting (ensure that emissions reductions used in carbon transfers are not counted twice); how to ensure overall mitigation of global emissions (so that Article 6 is not just an offsetting tool but rather leads to emissions reductions); how a levy on trades can fund adaptation efforts; and how to clarify whether pre-2020 credits generated under the Kyoto Protocol could continue to apply to emissions targets under the Paris Agreement. Following the lack of decision at COP25, weak rules were endorsed under the International Civil Aviation Organization and the International Maritime Organization, which could undercut ambitious efforts in this sector. It is imperative that countries find a robust compromise at COP26.

2. Building Resilience and Addressing Loss and Damage

During the Climate Dialogues, the Adaptation Committee and the Warsaw International Mechanism for Loss and Damage Executive Committee (WIM ExCom) provided updates on the progress of the work requested at COP25.

Adaptation Goal

In Madrid, countries requested that the Adaptation Committee determine how to assess the collective progress made in achieving the global goal of fostering climate resilience and increasing ability to adapt to the adverse impacts of climate change. This year, the Adaptation Committee began studying approaches and will produce a draft technical report next year that will include approaches, information and methodologies for assessing progress in enhancing adaptive capacity, strengthening resilience, and reducing vulnerability to climate change. This is well overdue, and additional spaces will likely be needed to consider the report and define the needed metrics before the global stocktake on countries’ collective efforts toward the Paris Agreement’s long-term goal begins in 2022.

Loss and Damage

One of the key outcomes for loss and damage in Madrid was establishing an expert group on action and support to address loss and damage by the end of 2020. One mandate of this expert group is to engage with the Standing Committee on Finance and collaborate with the Green Climate Fund on clarifying how developing countries can access funding for loss and damage. The terms of reference for this expert group were adopted during the WIM ExCom meeting in October, and it is expected to develop its plan of action at its first meeting early next year.

COP25 also led to the creation of the Santiago Network for Loss and Damage (SNLD), which is meant to catalyze the technical assistance to tackle loss and damage. Parties were still divided during the Climate Dialogues on what specific technical assistance the SNLD should provide and how it should be structured in order to deliver on its functions. Developing countries emphasized the need for a facilitative and networking platform that would connect them with experts and technical assistance providers, while developed countries promoted the use of existing structures and bodies, as well as with outside frameworks and networks.

3. Financing Climate Action

Public finance for climate action is showing the least progress and greatest signs of distrust. According to the latest OECD and Oxfam reports, as of 2018, developed countries were not on track to fulfill their commitment to mobilize $100 billion a year in climate finance for developing countries starting in 2020. Public efforts to mobilize private finance in developing countries has also stalled. These reports also highlight the continuing deficit of support for adaptation, which still receives only around a quarter of total public climate finance. This leaves the Paris Agreement commitment to balance funding between mitigation and adaptation unmet while the impacts continue to grow, which particularly affects the most vulnerable.

Given the concerning projections about the $100 billion, it is vital that developed countries give clear indications of how they will step up their funding to meet this goal in the coming years. The European Union is the only developed country grouping that has submitted its initial biennial communication — as mandated under the Paris Agreement — on its projected future climate finance provision. These communications, which are mandatory for all developed countries, are due before the end of 2020. They are the first formal submissions developed countries need to communicate under the Paris Agreement and can play an important role in reassuring developing countries that finance commitments will be met. Failure to do so will significantly undermine trust.

As part of the Climate Dialogues, the in-session workshop on long-term climate finance provided an overview of the state of mobilization and delivery of climate finance, its effectiveness and insights and lessons learned in recent years. Overall, developed countries failed to provide clear signals at the dialogues of their unwavering support to address the mounting and urgent needs of developing countries. The United Kingdom’s decision on November 25 to cut its official development assistance from 0.7% to 0.5% of GNI sent a negative signal. This came on top of growing concerns among developing countries that developed countries’ focus has skewed toward private finance initiatives, with too little attention given to public finance where delivery has been lagging.

As evident throughout the pandemic, public funding is vital in a crisis, providing stability and support in areas that the private sector can’t. The same is true for climate change, and developing countries are looking for reassurance that developed countries will uphold their funding commitments. COP26 will have a heavy finance agenda, including the start of negotiations on a new collective finance target, which must be agreed upon before 2025. It is vital that developed countries reaffirm their commitment toward increasing public climate finance over the coming year in order to build confidence ahead of the next crucial round of negotiations.

4. Transitioning to the Decade of Ambition

A two-day pre-2020 implementation and ambition roundtable took place during the Climate Dialogues to look at progress made by countries before 2020, primarily on mitigation, adaptation and finance. Many countries, especially developing nations, still felt that not enough time was provided to discuss the implications of the implementation gaps left by developed countries and what these gaps mean moving forward. It remains unclear how this roundtable will inform the second periodic review of the Convention’s long-term temperature goal and first global stocktake, where countries will review the adequacy of the Convention’s long-term global goal and the overall progress toward achieving the long-term goals of the Paris Agreement.

What’s Next on the Road to COP26?

On a more positive side, December 12th will mark the five-year anniversary of the adoption of the Paris Agreement with leaders-level ambition summit — co-hosted jointly by the United Nations, the COP26 U.K. Presidency and France, in collaboration with Chile and Italy. On that occasion, many world leaders are expected to demonstrate and confirm their more ambitious commitments. The prospects for enhanced NDCs — with more ambitious mitigation 2030 and mid-century targets — look hopeful, following the leadership from various vulnerable countries and the latest signals from the EU, China, Japan, South Korea and, more recently, from Colombia and the United Kingdom. The UNFCCC will publish an aggregate synthesis report by the end of February 2021 to capture the collective progress toward the Paris Agreement’s goals, based on NDCs communicated by the end of the year. The UNFCCC will update the synthesis report ahead of COP26 to take into account NDCs communicated in 2021 and provide a more complete picture of where we are, compared to the long-term goals.

The momentum witnessed among non-state actors during the Race To Zero in November, and the leadership shown by some countries — especially low- and middle-income countries who contributed the least, yet suffer the most from the crisis — must be sustained by significant public and private investments. However, commitments for scaled-up public finance to support developing countries and their efforts to adapt to the impacts of climate change remains in jeopardy.

Many more enhanced NDCs and long-term strategies are expected in 2021, and a significant amount of work remains in the negotiations for a successful COP26. Global health and safety measures will dictate how soon negotiators are able to meet again in person. However, the urgent need to respond to the climate emergency means that countries have to use all means necessary (including creative use of virtual modes and tools) and build trust to ensure the work gets done. Only then can COP26 send the message that the world can build back better while making our economies and our people more resilient and carbon-free.

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