- A “historic” agreement, sending a strong signal that the world is serious to tackle climate change, galvanizing the surge in non-state actor efforts and providing clear signals to business and investors.
- Confirmation and tightening of the ultimate objective: was 2oC, now “well below 2, with efforts to stay below 1.5”.
- Operationalises the temperature objective with a goal to reach net zero GHG emissions after 2050, albeit using a slightly more complicated language for that.
- Agreement is legally binding, but not the national emission reduction plans and targets, nor the level of providing financial support to developing countries.
- The mitigation commitments stretch from intensified consideration of potential additional actions before 2020 (including connecting to non-state actor efforts), a global stocktake in 2018, strengthening national plans every 5 years, starting in 2020 and producing low-emissions development strategies. The strengthening of national plans is essential as the current ones will lead at best to a temperature increase of 3-3.5o
- Use of market mechanisms between countries is allowed, but rules still need to be developed. There are no provisions for carbon pricing; there is just an acknowledgement that it can be useful.
- An adaptation goal is established that unfortunately only looks at a 1.5-2oC temperature increase, while there is a risk of higher temperatures.
- Addressing Loss and Damage, the remaining climate impacts that are not adapted to, is covered, but only in a risk evaluation and risk management and insurance sense. Liability of and compensation by industrialised countries is explicitly excluded.
- Finance obligations of developed countries are included, taking the $100 billion/yr from the Copenhagen Accord as a floor for the period after 2020, to be further discussed in the period before 2025. More adaptation finance has to happen.
- Technology development and diffusion provisions are mostly administrative. Impact will be limited. Outside initiatives launched in Paris and the increasing investment in clean technology can have a significant effect.
- Provisions for reporting and review to be strengthened, but detailed arrangements to be decided later.
The significance of this agreement is predominantly lying in the strong signal it gives that the whole world is serious about tackling climate change, almost 20 years after the last global agreement in Kyoto. As was visible in the run up to and during the Paris conference, there is an unprecedented surge in awareness of climate change and its impacts and of action on transforming our economy, energy system and land-use practices in many corners of society, NGO’s, businesses, cities, states, regions, etc. The agreement between more than 190 nations now galvanizes this and provides a strong signal for further action. It also makes clear that GHG emissions will have to get to (net) zero and implicitly therefore calls for end of the fossil fuel era.
It became clear during (the rushed gaveling by president Fabius) and after adoption of the agreement that some Parties are not fully agreeing with the outcome. The African Group of countries objects to the fact that Africa was not explicitly included in the list of vulnerable countries. Nicaragua made clear that they disagree with for instance the decision that article 8 of the agreement on Loss & Damage of the agreement cannot be a basis for liability or compensation. So consensus yes (the Arab countries did not object), unanimity no.
The objective of the agreement (and in fact the objective of the Climate Convention’s article 2) has been tightened somewhat. The agreement reached in Cancun in 2010 specified it as “2 degrees and considering if this should be lowered to 1.5”. The Paris Agreement says “well below 2oC above pre-industrial levels and to pursue efforts to limit the temperature increase to 1.5oC above pre-industrial”. During the negotiations a lot of time and effort was devoted by many delegations to a push for a strict 1.5oC limit, driven by vulnerable developing countries that argued the impacts of the 2oC increase would be devastating to them. Scientifically this is true, but the realities are that with current INDCs we are on track to an increase of 3.5oC, as shown by the UNEP Emission Gap Report and that closing the 2030 emissions gap for a 2oC trajectory is a major challenge, let alone the further emission reductions and large negative emissions later, required by a 1.5oC trajectory. Countries like India and China and other emerging economies obviously saw the implications of a 1.5oC limit for the starkly reduced remaining carbon budget that would be left for them and objected.
The Paris Agreement is a legally binding instrument under the UNFCCC. It requires Parties to produce National Determined Contributions (NDCs) to the required global emission reduction, but the individual NDCs and the specific reduction targets and measures in them, are not internationally legally binding. The same holds for specific commitment to provide financial support to developing countries.
In practice this will not make much difference, as can be seen from the experience with the Kyoto Protocol. There countries did commit to legally binding reduction targets, but when Canada decided not to implement these, nothing happened and Canada even formally withdrew from the Kyoto Protocol.
Crucial for making countries deliver on their NDCs is a good system of reporting, review and strengthening. For this see the sections on Ambition and Transparency.
The formulation of the long-term goals in article 4.1 has shifted in the various earlier drafts. The idea was to say something about the implications of the objective (“well below 2oC and pursue efforts to keep it below 1.5oC”) for global emission levels, as this is more operational than the temperature limits. IPCC AR5 gives the answer: “net zero GHG emissions by the end of the century for the 2oC scenarios”. After a long discussion this was reformulated as “aim to reach global peaking of greenhouse gas emissions as soon as possible …. and undertake rapid reductions thereafter in accordance with best available science, so as to achieve a balance between anthropogenic emissions by sources and removals by sinks of greenhouse gases in the second half of this century..”.
For all practical purposes this is equivalent to the “net zero” language and is thus in line with the science. The wording “in the second half of the century” are needed, since the objective now extends to below 2oC, requiring reaching “net zero” earlier. Nevertheless the African Group stated after the adoption of the agreement that the wording is unclear and needs a better definition, to be taken up in consultations by the President of the COP.
What unfortunately is missing is expressing this in terms of CO2 only. As the UNEP Emissions Gap Report 2015 clearly states, the implication of available scenarios is that net zero CO2 emissions need to be reached by 2060-2075 for a 2oC limit and around 2050 for a 1.5oC limit. That would have made the message about the end of the fossil fuel era much clearer.
Mitigation is a cornerstone of the agreement, but as indicated above, the heart of the efforts are in the NDCs from the 186 countries’ NDCs that will be put in a registry. This will allow much more flexibility to modify and strengthen them over time, as no new agreement (with its own ratification process) will be needed when NDCs are changed. In the Kyoto Protocol the targets were inscribed in the Protocol itself and thus new ratifications were needed when a second commitment period from 2012-2020 was agreed. Another reason for the registry model is that the US will only be able to join the Agreement if accession can be done via a Presidential Decision. Ratification in the US Senate would be impossible in the current political situation.
As laid out in the UNEP Emissions Gap Report, the collective impact of submitted INDCs is an estimated emission level of 54-56 GT CO2e by 2030, well above the level of 42 GtCO2e required to be on track to 2oC. The Decision text (II.17) accompanying the agreement notes that for the agreed objective and long-term goal emission global emission levels of not more than 40 GtCO2e by 2030 will be required.
Pre-2020 mitigation, which formally is not part of the agreement as this only enters into force in 2020, is addressed in the Decision text (106-133). During the negotiations over the last 4 years the issue has been discussed in a separate track. The outcome is a strengthened process of “technical examination by experts” of possible additional policies and measures, based on sharing experiences in implementation and considering studies of what can be done additionally. To give this process more political weight a provision is included to appoint “high level champions” to connect the technical process to political decision making in countries with the help of the UNFCCC producing Policy Makers Summaries of the more technical reports on the process.
A connection is also made to the so-called “non-state actors (NSA’s)”, covering the (voluntary) initiatives of citizens, businesses, cities, regions, provinces and (federal) states and collaborative initiatives of those players (sometimes with national states) that have emerged. The UNFCCC raised the profile of these NSA’s over the past 2 years by creating a registry (Non-State Actor Zone of Action, NAZCA) and high-level sessions during the regular UNFCCC meetings. By now more than 10000 entries have been made in the NAZCA registry and in Paris there was a surge in new announcements, including on doubling energy related R&D, investment in solar power, building 300 GW of renewable electricity capacity in Africa, pledging 100% renewable energy use by many companies, large scale restoration of degraded lands, and on many other topics.
A missed opportunity is that mitigation in international shipping and aviation sector has been left out of the agreement. This now has to be dealt with in IMO and ICAO, where progress has been extremely slow over the years.
The text has improved provisions for raising ambition in the period after Paris. It starts with a “facilitative dialogue” (Decision II.20) before the entry into force of the Paris Agreement in 2018 to “take stock of collective efforts” in relation to the long-term goal, with the purpose of informing the preparation of future NDCs.
This builds upon a whole range of provisions in Decisions IV.106-133 that strengthen the actions in the pre-2020 period, including a commitment “to ensure the highest possible mitigation efforts in the pre-2020 period” and a strengthened “technical examination process” of additional policies and measures that countries could take.
The big question is by when the current NDC should be revised. Article 4.9 says “every 5 years”, but as the Agreement will only enter into force in 2020 and the first global stocktake will happen in 2023, that means not before 2025.
However, Decisions III.23 and III.24 add a provision that “urges” or “requests” parties to already submit a new NDC by 2020. It is curious that a distinction is made in these terms. The “urges” is for Parties whose NDCs have a horizon of 2025 (such as the US), the “request” is for Parties whose INDCs have a 2030 horizon. So these provisions could bring the revision (and strengthening) forward to 2020, which is essential to have a chance of closing the 2030 emissions gap.
There is another element in the decision that pushes revision (and early strengthening), namely Decision II.17 mentioned above that says that 2030 global emission levels should not be higher than 40 GtCO2e. As we are heading for 55 Gt with current INDCs this provides a strong signal for strengthening.
Provisions for strengthening successive NDCs (each new NDC will be more ambitious than the previous one, strengthening can be done at any time) are included in articles 4.3 and 4.11.
An important element of a procedure for review and strengthening of NDCs is reporting on implementation and review. For accounting and reporting see the section on Transparency.
Finally a provision is included in article 4.19 saying that Parties “should strive to formulate …. long term low-emissions development strategies”. This would help countries to think about the necessary transitions in the energy, transport, buildings, agriculture, forestry and infrastructure sectors in the context of their economic and development priorities and would facilitate the strengthening of their short and medium term mitigation and adaptation efforts. Unfortunately no further guidance or support for these efforts is included. At the same time it is a remarkable achievement for this notion of a low emissions development trajectory to have been accepted so broadly in a matter of a few years.
Carbon Pricing and Market Mechanisms
The important role of carbon pricing as an incentive for emission reduction is only mentioned in the decision text (137) once. This does not mean that it is considered unimportant, but it reflects the philosophy of the agreement to leave the choice of instruments to individual countries, which have very different views on the use of carbon pricing. Movement in this area will have to come from cooperative initiatives such as the Carbon Pricing Leadership Coalition, led by the World Bank, helping like minded countries and other actors to promote and implement carbon pricing domestically. For the same reason domestic market mechanisms, like cap and trade, are not even mentioned in the agreement or the decision text. This is purely a choice of countries.
International market mechanisms, like the Clean Development Mechanism and International Emissions Trading that exist under the Kyoto Protocol, are covered in the agreement in article 6, albeit in a somewhat concealed way. The possibility for arrangements to transfer emission reductions is created, a “mechanism” is established that needs further elaboration later and “robust accounting to provide, inter alia, double counting” is mandated.
Adaptation and Loss & Damage
A global goal is established (article 7.1) of “enhancing adaptive capacity, strengthening resilience and reducing vulnerability to climate change”, which is a rather general statement. It puts this goal “in the context of the temperature goal referred to in article 2” (the “well below 2oC, striving for 1.5oC”). This is far too weak, as there is a fair chance global temperatures will not be contained to those levels, but will increase with 3oC or more. A more solid approach to adaptation would have been to “prepare for the worst”, but that would probably have generated calls for more financial assistance from developed countries, who feel already too much under pressure.
“Loss and damage”, the remaining climate impacts that are adapted to, has its own article (8). It accepts the issue and absorbs an already ongoing programme of activities (the Warsaw Mechanism), aimed at better understanding of the risks, knowledge about risk management and insurance. Decision 52 states that this article cannot provide a basis for liability of or compensation by industrialised countries, the ones responsible for most of the historic emissions. This has been a red line for these countries in the negotiations and the disclaimer has angered vulnerable developing countries and the climate justice civil society movement.
Finance, in particular the support to developing countries for preparing their NDCs, implementing adaptation and mitigation measures, reporting on implementation and to cover loss& damage as a result of not adapting or being able to adapt, has been one of the most hotly debates issues in Paris. The current situation, emerging from the Copenhagen Accord, is that developed countries have promised to “mobilise $100 billon/yr from public and private sources” to flow to developing countries by 2020.
OECD reported recently on the actual commitments of funds according to this promise and concluded that for 2013-2014 the average flow was $57 billion/yr. In Paris this was immediately contested by India and other emerging economies, arguing the numbers were inflated and actual delivery of funding was far behind and in passing also stating the formulation of Copenhagen with private investments was unacceptable and that only funds through the Green Climate Fund should be counted. Developing countries, in particular the most vulnerable, insisted also that much more finance for adaptation is required, as they are already facing the impacts of climate change (the OECD report identified a flow of about $10 billion/yr for adaptation purposes, mostly from public sources, while estimates of what is needed may be 10-fold or more by 2030).
At the same time developed countries were unwilling to commit to increased funding and insisted that private investments are needed to make the transition of the energy system happen. Against this background it is no surprise the discussions on finance were tense.
The result is that the agreement in article 9 has provisions stipulating developed country obligations to support developing countries financially. OECD countries have argued that the world has changed and that many countries outside OECD are now richer than several OECD members and thus should also contribute. This was rejected and only voluntary contributions from non-OECD countries are encouraged. More finance for adaptation is called for. And developed countries committed to provide more clarity and predictability of finance. But no numbers in the agreement text. Decision 54 states that developed countries before 2025 will come up with a new target for climate finance above the $100 billion promised in Copenhagen. Decision 58 specifies that accounting methods will be developed, so that controversy over the amounts delivered can be avoided in the future.
For promotion of the transfer of technology to developing countries a range of institutional provisions had been created since Copenhagen under the UNFCCC (Technology Mechanism, Technology Executive Committee, Climate Technology Centre and Network). The Paris Agreement adds a Technology Framework (art 10.3), but it is the question what this adds to the necessary development and diffusion of clean technologies. Even saying that cooperation in this area needs to be strengthened will not make much difference. The special emphasis on innovation (art 10.5) is positive, but is is unclear how this will be promoted in practice. However, initiatives outside the UNFCCC, such as the Doubling R&D initiative of 20 countries and some major foundations, the Solar Alliance of 120 countries initiated by India and the strong surge in clean energy and climate friendly investments will probably have more impact.
On the issue of capacity building in developing countries the approach in the agreement has been mostly administrative as well: creating a new Capacity Building Committee , a work programme, annual reporting on progress, planned evaluations of effectiveness of capacity building activities and a special capacity building initiative for transparency.
The provisions on accounting and reporting on mitigation actions in article 4.13 are fairly general, such as “promoting environmental integrity, transparency, etc” and “avoid double counting” (in case use is made of market mechanisms). Further guidance by the Conference of Parties (to be prepared by the Ad Hoc Working Group on the Paris Agreement as stipulated in decision III.28) is foreseen.
A more comprehensive system of reporting and review is established in article 13, the details of which are still to be developed and agreed when the agreement enters into force in 2020. It is clear that much of the current arrangements for reporting and review, including national communications, biennial reports and biennial update reports, international assessment and review (for developed countries) and international consultation and analysis (for developing countries), will be drawn upon. Strengthening of the reporting and review requirements can be expected, but developing countries are insisting that these requirements for them should be lighter and less frequent.
Equity and climate justice
Venezuela made a big point of acknowledging in its remarks after adoption of the agreement the reflection in the pre-amble of the agreement of human rights, the right of indigenous people, climate justice, gender equality, intergenerational equity and other important principles. In the NGO Climate Justice community reactions were quite negative, as they pointed out that the operational parts of the agreement do not sufficiently address the issues and the decision text has a disclaimer on liability and compensation for loss & damage.
For the agreement itself equity was translated into differentiation between developed and developing countries in the various obligations. This led to a big fight, as the agreed negotiation remit agreed in Durban in 2011 had done away with the hard division between Annex I and non-Annex I countries and the mitigation efforts had been structured along the lines of self-differentiation of INDCs. Even in the mitigation section (article 4.4), a certain degree of explicit differentiation was brought back in the sense that for developed countries economy-wide emission reduction targets are mandatory, and for developing countries not.
Entry into force
There is a rather light hurdle for entry into force: at least 55 countries and coverage of at least 55% of global GHG emissions. With the very broad support of the agreement in Paris, entry into force may take some time, but should not be a problem.
 Paris Agreement, http://unfccc.int/resource/docs/2015/cop21/eng/l09r01.pdf
 UNEP Emission Gap Report 2015, http://uneplive.org/media/docs/theme/13/EGR%202015_Technical%20Report.pdf
 Carbon Pricing Leadership Coalition, http://www.carbonpricingleadership.org
 OECD and CPI, Climate Finance in 2013-14 and the USD 100 billion goal, http://www.oecd.org/env/cc/oecd-cpi-climate-finance-report.htm