European finance ministers will today (21 February) call for the EU executive to prepare a paper on raising climate funds through carbon pricing on aviation and maritime transport by June, if draft conclusions seen by EURACTIV are approved.
Money raised would help finance a $100-billion per year Green Climate Fund, the centerpiece of any successor deal to the Kyoto Protocol, to help poor countries adapt to and mitigate the effects of global warming.
In its draft conclusions, the EU Council of Ministers “invites the Commission to prepare a reflection paper by June on [the] carbon pricing of global aviation and maritime transportation taking into account the developments in IMO [International Maritime Organisation] and ICAO [International Civil Aviation Organisation].”
Last May, EU finance ministers called for the IMO and ICAO to "develop without delay a global policy framework that avoids competitive distortions or carbon leakage".
This is fleshed out in the leaked draft conclusions which say that “the carbon pricing of global aviation and maritime transportation would generate the necessary price signal to efficiently achieve more emission reductions from these sectors.”
“The carbon pricing of global aviation and maritime transportation have as well the potential to generate large financial flows,” the document states.
Green Climate Fund
Such flows could capitalise the Green Climate Fund which was formally set up at the Durban Summit on Climate Change last December, but still lacks revenues.
The EU executive has indicated that Brussels would pay up to one-third of the fund but with harsh economic climes constraining national budgets and private-sector investors alike, ‘innovative sources’ of finance are increasingly being looked at to raise the money.
Lies Craeynest, Oxfam’s EU climate change expert, welcomed the move but warned that actions rather than words were now needed.
“The litmus test for Europe’s credibility this year will be whether they put their money where their mouth is, and make sure that the Green Climate Fund does not remain an empty shell,” she said in a statement sent to EURACTIV.
“We need to see Europe behind a global deal that raises cash for climate action in poor countries from international aviation and shipping,” she added.
The EU has already mobilised €4.68 billion of fast start climate finance, as part of the €7.2 billion it promised to have in place by the end of 2012 at the Copenhagen Climate Summit in 2009.
Environmentalists claim that much of that money was recycled from previous aid pledges, and are concerned that no member state has yet committed a climate aid figure for 2013 or afterwards.
Planned UN climate talks in Qatar in December could reveal the depth of the EU’s long-stated commitment to capitalise the Green Climate Fund.
The fund has been an important element in the UN Framework Convention on Climate Change negotiations between the developed world, which has historically been responsible for most global carbon dioxide emissions, and a developing world that is suffering most of the consequences.
According to an April 2011 European Commission working document, revenues raised from a global pricing mechanism for shipping and aviation could generate “up to $24 billion worldwide.”