Gleneagles follow up: creating the conditions for an international agreement

1. Gleneagles follow up: creating the conditions for an international agreement Amal-Lee Amin International Climate Change Policy Global Atmosphere Department for Environment, Food and Rural Affairs UK

2. Progressing Action to Create Basis for Agreement on a Future Climate Process through the Gleneagles Dialogue • Gleneagles Outcomes on Climate Change • Mexico Ministerial meeting of the Dialogue 3 - 4 Oct 2006 • Stern Review • IEA Energy Technology Perspectives • World Bank – led work to develop global investment framework to address climate change challenges • Gleneagles Dialogue Moving Forward

3. G8 and EU Presidencies 2005 • February: Avoiding Dangerous Climate Change – Science conference • March: Energy and Environment Ministers meeting of 20 countries with large and growing energy needs • March: G8 Environment and Development: focus on climate risks and threats to Africa’s development • May: Workshop on Innovation and Research on Energy (WIRE) • 7th July G8 Summit at Gleneagles • September: EU Summits with China and India – launched partnerships on climate change • 1st November first meeting of the Gleneagles Dialogue • Announce Stern Review on the economics of climate change • Ongoing outreach events with business, civil society and legislators

4. Progress in 2005 • Widening and deepening climate change debate beyond Environment Ministries (energy, development, finance) • Clear recognition on developing countries needs for increasing energy for sustainable development – challenge to address energy and climate security • Debate moved beyond the science of climate change to.. • …..how to promote the investment necessary to enable global transition to a secure and low carbon economy? • Strengthened support for international cooperation on technology development and deployment (and transfer) • Awareness of climate impacts, threats to development and the achievement of the MDGs (World Summit) • Confidence and understanding – basis for positive outcome at Montreal and momentum for discussions on the future

5. Key elements of the G8 Political Agreement To act with resolve and urgency now to meet the shared and multiple objectives of reducing greenhouse gas emissions, enhancing energy security and efforts to reduce poverty.. Need to work together, and in partnership with major emerging economies, to find ways to achieve substantial reductions in greenhouse gas emissions .. through promotion of low-emitting energy systems To take further action to • promote innovation, energy efficiency, conservation, improve policy, regulatory and financing frameworks; and accelerate deployment of low carbon technology • work with developing countries to enhance private investment and transfer of technologies, taking into account their own energy needs and priorities • raise awareness of climate change and our other multiple challenges, and the means of dealing with them;

6. Gleneagles 7th July 2005 • Heads of the G8 countries and Brazil, China, India, Mexico and South Africa (the +5) • G8 Agreement to Gleneagles Plan of Action on Climate Change Clean Energy and Sustainable Development, in particular recognising the need for G8 to work with developing countries to: • enable a global transition to low carbon economy • improve resilience to climate impacts and integration of adaptation strategies • The +5 proposal for a “new paradigm” on international technology cooperation • Gleneagles Dialogue between the G8 and countries with large and growing energy needs • Report to Japan’s G8 Summit in 2008

7. Gleneagles Dialogue • To address the strategic challenge of transforming our energy systems for secure and sustainable future • Monitor implementation the Gleneagles Plan of Action and explore how to build on this progress • Share best practice between participating governments • Work with appropriate partnerships, institutions and initiatives including: • the IEA on alternative energy scenarios and strategies aimed at a clean clever and competitive energy future • the World Bank will take a leadership role in creating an new investment framework for clean energy and development • Stern Review on the costs of action and inaction

8. Key initiatives that will inform the Gleneagles Dialogue • Low Carbon Societies Workshop: Japan 2006 • Energy Research and Innovation Workshop (WIRE): Brazil hosting follow-up 19-20 Sep 2006 • EU-China Near Zero Emissions from Coal (NZEC) using Carbon Capture and Storage • Asia Pacific Partnership • Partnerships and initiatives REN21 and REEEP, new Global Bioenergy Partnership, CSLF etc • Joint UK-India Technology Transfer Study (including IPR) • World Economic Forum and World Business Council on Sustainable Development • GLOBE – parallel legislators dialogue up until 2008 • Outreach activities with civil society (Chatham House)

9. Gleneagles Dialogue in 2006 • Mexico Ministerial Meeting to consider three major challenges for addressing energy and climate security: • Economic challenge – Stern Review • Technology challenge – IEA energy technology perspectives (June 2006) • Investment challenge – World Bank leading process for a global Investment Framework • Aim for agreement on: • Challenges and opportunities at the national level • Potential for enhancing international cooperation and elements of a “new paradigm” • Joint initiatives and practical cooperation for scaling-up climate related investment

10. Stern Review • Implications for energy demand and emissions as a result of economic growth over the coming decades • Economic, social and environmental consequences of climate change • Impact and effectiveness of national and international policies and arrangements in reducing net emissions in a cost-effective way • Economics of moving to a low-carbon global economy, focusing on the medium to long-term perspective, and drawing implications for the timescales for action, and choice of policies and institutions • An assessment of the potential of different approaches for adaptation to changes in the climate 

11. IEA: Energy Technology Perspectives

12. IEA: Energy Technology Perspectives • Possible to return energy-related emissions to current levels by 2050 • Using technologies that already exist or are under development (energy efficiency, decarbonisation of electricity and bio-fuels for transport) • Costs are not disproportionate (< US$25/te CO2) but will require substantial effort and investment by both public and private sector • Policy implications • Energy efficiency is top priority • Well focussed R&D programmes are essential and transition from R&D to deployment critical • Governments must create a stable policy environment that promotes low-carbon energy options that are global in scope • Non-economic barriers must receive attention • Collaboration with developing countries essential

13. Aims of World Bank led work on a global Investment Framework • IFIs have a critical role in mobilising investment from a range of sources, including public and private sector • Improve coordination and coherence of existing sources of energy investment: public sector; domestic and international capital markets; multilateral institutions; sources of concessionary finance as well as; carbon finance • Assist in overcoming obstacles to investment in developing countries • Facilitate the transfer of finance and technology • Allow financing from different sources to be combined effectively, to catalyse the investment needed • World Bank to lead – work closely with Regional Development Banks which are now establishing their own work programmes and activities

14. World Bank Activities So Far • WB programme of work focused on three pillars: access to energy; low carbon technology and; adaptation. • Work proceeding on two-tracks: • Track 1: Until Annual Meeting Sep 2006 – further work to develop the Framework and detailed work programme 2006–2008, including proposals for country case studies • Track 2: Implementation of the 2006-2008 work programme • Emphasis on ensuring existing financing instruments work most effectively to address energy and climate security • Also propose new Clean Energy Financing Vehicle (CEFV): • assist in scaling up and commercialisation new technology • buy down the costs of low carbon technologies/infrastructure • mitigate technology risks by blending different types of finance (loans, grants, carbon finance)

15. Realising the Vision for a Global Investment Framework to Achieve Energy and Climate Security • Potential for transforming global investment patterns – to support energy and climate security • Realising this requires long-term commitment for financing, human and institutional capacity building • Requires broad support and high level of ambition from the banks’ stakeholders, both developed and developing countries • Encourage the banks to work together to produce an integrated Framework that promotes shift in global investment patterns • Strengthen linkages with the work of other international and regional organisations including IEA and relevant partnerships • Further engagement with business, industry and civil society • Need to demonstrate potential early on – explore with developing countries how the new initiatives and instruments can benefit in national efforts to attract investment in low carbon energy and adaptation

16. Gleneagles Dialogue Moving Forward • Need to understand challenges for making the transition to a low carbon economy globally… and the opportunities for working together to achieve this • Identify incentives for channelling investment in low carbon technology and adaptation at the national level • Elaborate the concept of a “new paradigm” for technology cooperation, including technology transfer N-S, S-S and S-N as well as how to drive innovation into new technologies • Practical cooperation to pilot projects and programmes to demonstrate successful investment and financing approaches – utilising the new financing instruments developed • Demonstrate tangible progress on technology cooperation - example: UK-Brazil-South Africa Taskforce on Biofuels • Ongoing outreach to all key stakeholders – business, civil society and legislators

17. Finally… • Demonstrating that all countries can make the transition to a secure and low carbon economy consistent with strong economic growth will create a firmer basis for agreement to a future climate change process that involves all Parties • Enabling such a transition requires a concerted global effort involving all Governments and all stakeholders at the national and international level • Japan G8 Summit 2008 key milestone in global efforts to combat climate change and achieve long-term sustainable development

18. Thank You