IGES-TERI Asia Pacific Policy Dialogue in New Delhi on Sustainable Low-Carbon Development in Asia: Prospects for a Successful Future Climate Regime
30 October 2009

On 22 and 23 October 2009, the Institute for Global Environmental Strategies (IGES - Hayama, Kanagawa; Chair - Hironori Hamanaka) organised a policy dialogue on the future climate regime, entitled “Sustainable Low-Carbon Development in Asia: Prospects for a Successful Future Climate Regime”. The dialogue was held in New Delhi, in collaboration with The Energy and Resources Institute (TERI), India.

Approximately 60 participants attended the dialogue including policymakers, businesses and intellectuals from both countries, as well as participants from China, Indonesia, Malaysia, the United Kingdom and the United States. There are also representatives from international organisations such as the World Bank, Asia Development Bank and the United Nations Development Programme (UNDP).

The dialogue focused on seven key aspects to tackle emissions reductions and achieve low-carbon development, including 1) low-carbon scenarios, 2) domestic actions, 3) non-UNFCCC initiatives, 4) measurement, reporting and verification (MRV) of domestic actions and international support, 5) a co-benefits approach, 6) prospects for the Copenhagen Deal and 7) adaptation. There was a frank and lively exchange of opinions on current issues and possible options for the future climate regime.

The results of the policy dialogues including this dialogue and the one held in China this September, will be presented at a side event at the 15th Conference of the Parties to the UN Framework Convention on Climate Change (COP15/CMP5) scheduled for December 2009 in Copenhagen, Denmark.

About IGES-ERI Policy Dialogue in Beijing

For enquiries about this press release please contact:
Mr. Kentaro Tamura
Sub Manager, Climate Change Project
Institute for Global Environmental Strategies (IGES)

Ms. Megumi Kido, PR Officer
Institute for Global Environmental Strategies (IGES)
2108-11 Kamiyamaguchi, Hayama, Kanagawa,
240-0115 Japan
Tel: +81-46-855-3700

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Summary of the IGES-TERI Policy Dialogue

Session 1: Low-Carbon Society

- A Japanese speaker stressed that it would be critical to decouple economic growth from greenhouse gas (GHG) emissions to realise fully-developed low-carbon societies in Asia. Regional cooperation and integration could help facilitate the diffusion of low-carbon technologies and foster the low-carbon growth needed to realise that goal.
- An emission modelling study from 2001/2002 to 2031/2032 for India was presented. The modelling study included a “reference” scenario with an 8-fold increase and “ambition” scenario with a 1.5-fold increase in carbon dioxide (CO2) emissions from India. The study suggested it is critical for India to accelerate renewable energy use, especially from solar, wind, biomass and nuclear power plants.
- An Indian researcher argued that the residential sector holds the key to moving towards a low-carbon society at the city level. Rapid urbanisation is driving increased energy use and GHG emissions. In rural areas, the use of inefficiently-utilised biomass is rapidly changing to the use of gas and electricity. New technologies and materials for new buildings can facilitate leap-frogging toward a low-carbon society.
- To lead Indonesia toward a fully developed low-carbon society, an Indonesian participant emphasised that it would necessary to increase the country’s gross domestic product (GDP) and to decouple growth from GHG emissions. In addition, it is necessary to promote the utilisation of more efficient and less GHG emitting energy resources, and to introduce good urban planning and transport infrastructure. Also, regional cooperation in Asia will be critical to a low-carbon transition.
- An Indian energy expert argued it is relatively well-understood what actions are needed to reduce GHG emissions through 2020, but work needs to be done specifying what types of policies and technologies will be necessary between 2020 and 2030. In addition, it is clear that we need a major change in our societies beyond technological changes to realise sustainable low-carbon societies in Asia.

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Session 2: Domestic Actions and Implementation

- Ambitious domestic actions in China, India, Indonesia, Japan and Malaysia were reported, despite the fact that most of them were still at the planning stage or early stage of implementation. Most speakers emphasised that energy efficiency improvements could offer significant opportunities for taking a low-carbon development pathway.
- An Indian participant pointed out that equity (or distributional) issues have not been adequately addressed when implementing domestic actions toward a low-carbon society. In response, the importance of governance mechanisms to ensure multi-stakeholder participation in the decision-making process was emphasised by a Japanese speaker.
- To achieve a long-term mitigation target, the carbon intensity per unit GDP in China needs to be reduced further. However, a Chinese participant pointed out two challenges. Firstly, because China has taken advantage of cheap mitigation options over the last decade, there are fewer low-cost options. Secondly, many of the low-cost options require upfront investments, and the private financial sector is still not developed enough to provide that financing.
- An Indian speaker argued that while current financial resources from international financial institutions, public and private sectors were not adequate to lead to a low-carbon pathway, adopting energy efficiency policies and measures could significantly bring down the investments required.
- A Malaysian speaker mentioned that while Malaysia’s current electricity generation heavily depends on natural gas (approximately 65%), it would be desirable to diversify energy resources (gas 30%, coal 30%, hydro and renewable energy 30%, and nuclear generation 10%) from a viewpoint of energy security.

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Session 3: Non-UNFCCC Initiatives

- A participant from Japan used a comparative analysis and lessons from non-climate regimes to argue that bilateral cooperation could supplement the multilateral UNFCCC regime.
- A Chinese participant based in the U.S. felt that bilateral cooperation on climate and energy could strengthen U.S.-China relations and multilateral UNFCCC processes. Recognition of bilateral U.S.-China cooperation under the multilateral UNFCCC regime could improve current bilateral cooperation on issues such as carbon capture and storage (CCS).
- A participant from India pointed out that the UNFCCC process and non-UNFCCC bi- and multilateral processes are not necessarily mutually exclusive. Rather they could be mutually supportive. To make sure that they are supportive, he argued that their objectives should be the same; and host countries should avoid duplication of assistance. On a separate point, the participant also argued that public funding is critical to bringing in private finance for low-carbon technologies.
- A participant from India indicated that further analysis of current bilateral cooperation is needed to examine how much foreign assistance really benefits the host country.

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Session 4: MRV

- The Bali Action Plan leaves open to interpretation what the terms MRV entails, what needs to be MRVed, when MRV should occur and by whom MRV should be carried out, and whether MRV requirements could vary from one country to another or by types of actions.
- A consensus among the Parties must be made on the objective of MRV. Such a consensus would help ensure that there are no free riders, that there is recognition to the Parties of their actions, and that there is a need to build trust and confidence among the Parties. MRV serves as an overarching mechanism to increase acceptance among the Parties.
- Metrics must be defined to measure the impacts of diverse mitigation actions carried out by the Parties. Capacity building is necessary to ensure reliability, accessibility and credibility of the data.
- Reporting should identify key sectors and categories for GHG emissions while ensuring comparability of efforts by the Parties.
- Identifying compliance mechanisms for verification is crucial. At the same time, the design of MRV offers an opportunity to change the overall structure of the review system, provided that the currently available review system is carried out by mostly donor-driven multilateral institutions.
- The international registry’s scope could include adaptation actions as well as mitigation actions.

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Session 5: Co-benefits

- A researcher based in Japan argued that studies measuring co-benefits need to pay more attention to incentives for realising co-benefits. A better understanding of these incentives could contribute to debates over how the future regime could promote co-benefits and support the mitigation of short-term warming agents such as black carbon.
- A researcher based in India argued that a co-benefits approach is an urgent priority in India. The approach is important because it can reduce urban air pollution, GHGs and energy costs. Realising these co-benefits requires mainstreaming co-benefits into development planning.
- A researcher based in India contended that co-benefits approach should receive more attention in Asia’s cities because of its potential to improve public health in densely populated urban areas. He further argued research on co-benefits approach should focus on air pollution’s multiple causes, multiple sources and multiple consequences.
- An official working for the Delhi subway claimed that time savings and reduced fuel costs are the subway’s primary benefits, not its co-benefits. Reforming the additionality rules in the future climate regime’s market-based mechanism could help realise these benefits.
- An official working for an international development agency underlined there are co-benefits beyond improved air quality, including poverty alleviation, green jobs and energy security. He also noted many of the barriers to realising co-benefits, such as limited awareness, financing bottlenecks and market failures, are similar to barriers confronting other development policies.
- Audience members pointed to the need for reforms to reduce project approval times for CDM projects with co-benefits; a better understanding of the magnitude of black carbon’s impacts on climate systems; more research on co-benefits in developed as well as developing countries; and a clearer understanding of how nationally appropriate mitigation actions (NAMAs) with co-benefits could receive preferential support from the future climate regime.

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Session 6: Prospects for a Copenhagen Deal

- Several participants highlighted progress in the negotiations on issues such as NAMAs coming from domestic implementation which did not exist at the time of the Kyoto Protocol.
- A participant from India expressed concerns about challenges related to the four building blocks of the Bali Action Plan given the limited time to arrive at a fair and equitable deal in Copenhagen. These challenges included mid-term target-setting by developed countries (mitigation); the unclear support for the Adaptation Fund other than the 2% share of proceeds from CDM (adaptation); the lack of a precise funding mechanism (financing) and Intellectual Protection Rights (technology). The participant cautioned that given the number of unresolved issues there may be no deal to emerge from Copenhagen.
- A participant from Japan pointed to the importance of mutual understanding between developed and developing countries; in particular, developed countries’ commitment to mid-term targets and a pledge for scaled-up finance. Rather than simply extending the Kyoto Protocol, some form of new legal instrument under the UNFCCC could be considered to accommodate the U.S., while MRVable NAMAs, a compliance procedure, and a funding mechanism could accommodate major developing countries.
- A researcher from India offered a non-political perspective on the status of climate negotiations. He presented results from a recent study showing that the current division of remaining atmospheric carbon space is unfair. He further argued that a GHG offset scheme could result in carbon space being sold cheaply. He also mentioned that offset schemes can have the perverse effect of discouraging developed countries from innovations in energy systems.
- A participant from Japan proposed the idea of establishing a multilateral fund managed by the operational entity and regional window to avoid the regional disparities evident in the current CDM.

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Session 7: Adaptation

- Differentiating development from adaptation is difficult but operationally not necessary. A good development strategy can help with adaptation and a good adaptation strategy can safeguard development.
- Mainstreaming adaptation into developmental planning has to happen at all levels (national, regional and local levels) since adaptation decisions are to be made at different levels.
- Incentives, such as low-risk insurance premiums, would have to be in place for enhanced mainstreaming of adaptation at various levels including adaptation in the private sector (including individuals).
- Measuring progress in mainstreaming adaptation into national and sectoral planning is possible by drawing experiences and tools available in environmental and disaster risk reduction areas.
- Best practices in mainstreaming need to be identified and scaled up.
- Filling the gap between adaptation research and policymaking can further enhance the mainstreaming of adaptation.
- Under a wet scenario, global adaptation costs would be higher in coastal zone protection followed by water and agriculture. Hence, economic growth could be a powerful form of adaptation but not “business as usual” development. Rather a form of development that is flexible enough to accommodate and accept new climate information could serve as a powerful tool to reduce climate change impacts.

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