Monday Dec. 14: update on Kyoto negotiations:

China, India and Brazil and a slew of other developing countries walked out of UN negotiations today as they viewed the discussions thus far have been very unbalanced. Their view is that too much time has been dedicated discussing long-term cooperative action rather than a successor to the Kyoto Protocol in addition to their dissatisfaction with the climate finance packages being proposed by Annex 1 countries thus far. 

On the other hand, the COP President views the solution to closing a deal is to raise the total pre-2012 climate financing package offered by Annex 1 countries. According to U.S. negotiators, the solution for carrying forward the negotiations this week will need to include more than just raising the amount of public money as this raises the expectation for an even bigger finance package in 2013 and effort needs to be placed on coming to agreement on areas that aren’t necessarily dependent on the provision of additional funds from Annex 1 countries.

Around 1 P.M. today the 2 UN Chairs leading the negotiation process distributed a new draft text of a successor to the Kyoto Protocol. At just 4 pages, it’s a slimmed down version of the 31-page document that negotiators received last Friday. The U.S. and EU position is that it’s not perfect, but a lot better than the draft texts that were being circulated when COP15 began last week and can very likely be used as a framework for moving forward.  Up until now there has been no reaction from individual countries yet, and the G77+China have been told not to meet with any other parties yet. 

Further, the text includes language that has long been proposed by the U.S. on technology transfer: 

-Technology executive committee. Similar to the CDM Executive Board, it would report directly on the role of tech transfer. 

-Clean technology center. The center would provide support to developing countries on various tech programs and would rely on a network of technology experts from both the public and private sector

We’ll provide an update tomorrow on the reaction from negotiators on this new text. In other news:

CDM Reform: There has been very little discussion on CDM reform up until now as the G77 isn’t willing to vote on issues related to climate financing until a ‘reasonable’ financing package has been put forward.

Sectoral crediting: The G77 isn’t very supportive of sectoral mechanisms and therefore a very open discussion remains. The final text agreed on this week may include 1 or 2 very vague sentences as negotiators aren’t going to take this issue up. Therefore it is expected that they will punt on this issue and sectoral crediting and NAMA’s won’t make much progress here in Copenhagen. 

MRV: No specific language is currently on the negotiating table. According to U.S. negotiators the key issue is whether developing countries would agree to MRV for unsupported actions such as NAMA’s since they currently are more willing to take on MRV for actions developed countries will bear the costs for.

REDD: There is progress that is being made as there is around a bloc of 40 or so countries that are keen for an outcome. Negotiators are expecting a likely outcome on the role of REDD and its linkages to the current Kyoto market.

CCS: There is a big dispute still over whether or not CCS can be included as a project type in the CDM since there is a wide array of opinion on how it would be applied. The U.S. view is that CCS is a critical and priority technology that needs to be implemented since there are resources already allocated from the U.S. Dept. of Energy to deploy pilot CCS projects globally. 

The only solution for the U.S. to go forward with Kyoto negotiations is if there is a system designed here in Copenhagen will accommodate climate change legislation that is currently being proposed in Washington.   Their key scope of work is to create a system that will provide financing for LDC countries that also simultaneously strengthens the capacity of those governments and to create an investment environment for offsets markets with the least amount of initial government expenditure that the private sector can eventually step into.

Heads of state will be arriving in Copenhagen tomorrow evening in anticipation of the formal statements that will be made here for the last days of the conference. It is unclear what effect these statements will have and how much time heads of state will stay in the Bella Center as most are planning bilateral activities while they are here.

U.S. Energy Secretary Steven Chu was in Copenhagen today and announced several interesting measures:

1.       Technology Action Plan in conjunction with the Major Economies Forum. This plan will represent how major economies can best move forward on areas related to clean energy deployment

2.       Renewables and Efficiency Deployment Initiative. A finance package of $350 million spent over 5 years (of which $85 million will come from the U.S.) will support existing renewable energy and energy efficiency government funds and scale up the deployment of rural LED and rural solar home energy systems. NB: these funds are not related to a potential U.S. climate finance package as part of the ongoing Kyoto negotiations

3.       The U.S. and in particular, California, will work with international agencies and other countries to advance labeling and standards for energy efficient appliances. California and India are already moving forward on linking together their R&D in this sector.