Loss and damage in the Paris Agreement rule book – state of play

At the start of September, delegates from all countries met in Bangkok to progress work on developing the guidelines for implementing the Paris Agreement, that is mandated to conclude by the end of this year at COP24 in Katowice.

One of the core aspects of this exercise is the development of rules that will enable the assessment of the collective progress towards achieving the long-term goals of the Paris Agreement, including limiting global temperature rise to 1.5 degrees Celsius above pre-industrial levels. In Bangkok, building on consistent calls at negotiation sessions since Paris in December 2015, many developing countries argued that loss and damage (L&D) should be systematically considered in this context. How did that go?

Key information

What would it mean to systematically consider L&D in the Paris Agreement rule book? Three overarching categories of information on L&D are relevant to answer this question.

One is information on the actual scale of L&D that has occurred. How many lives were lost, how many buildings destroyed, what is the size of the area that has become uninhabitable? How much has climate change increased the likelihood of the extreme events, which triggered these losses? Heat waves like the one that hit Northern Europe this year have become at least twice as likely due to climate change. The assessment of the exceptional monsoon rain that has led to the heavy flooding in Kerala is ongoing.

Then there is information on the action that countries have taken to address this L&D. What were the costs of reconstruction? How much do countries spend on sovereign climate risk insurance? What are the interest rates of credits they had to take out in order to rebuild their economies?

And finally there is the scale of support that has been mobilised to support those countries. What grants were given to countries to support their reconstruction? To what extent are insurance premiums subsidised? Have social safety nets been built with donor support?

Developing countries argue that all this information is an indispensable barometer for the adequacy of global climate action. In fact, in Article 8 of the Paris Agreement governments set out to collectively “enhance understanding, action and support … with respect to loss and damage”.

Relevant negotiation themes

How could this fit in the context of the Paris Agreement rule book? Three negotiation themes are particularly relevant: The Enhanced Transparency Framework, the Global Stocktake, and Finance.

Under the Enhanced Transparency Framework, every two years countries will report what they have done in order to “provide a clear understanding of climate change action” (Article 13.5 of the Paris Agreement) and “clarity on support provided and received” (Article 13.6). The overarching goal of this exercise is to “build mutual trust and confidence and to promote effective implementation” (Article 13.1) and to inform the 5-yearly Global Stocktake.

Under the Global Stocktake, information on implementation of the Paris Agreement will be collected and then synthesised to assess the collective progress towards achieving the purpose of the Paris Agreement and its long-term goals. From this information, we will all see how far we are from the agreed goals, and the idea is that this stocktaking process will inform countries in “updating and enhancing…their actions and support” (Article 14.3). For example, through the ramping-up of mitigation ambition in the next round of nationally determined contributions (NDCs).

Finance is a cross-cutting issue but also receives separate attention under the Paris Agreement, for example under Article 9.5 in which developed countries are required to communicate the level of public resources that they plan to provide to developing countries. Under Article 9.7 developed countries shall provide information on support provided and mobilised – information that will feed into the Enhanced Transparency Framework.

Many questions in these negotiation themes are still unresolved. For example, in terms of Finance, how should support provided and mobilised be reported (Article 9.7) and what exactly is the information needed under Article 9.5 on Finance? Which methods should be used to report on mitigation and what kind of information should be reported on adaptation under the Enhanced Transparency Framework? What are the sources of information, and how will information by synthesized in the Global Stocktake? Who will do the synthesis?

Progress?

Delegates discussed these kinds of questions in Bangkok, in the context of draft texts that laid out design options and technical details under each of the negotiation themes. The Least Developed Countries (LDCs), the Alliance of Small Island States (AOSIS) and a number of other developing country groups have consistently made the case for including information on L&D in all of the above three negotiation themes (Transparency, Global Stocktake, Finance) about explicitly including L&D in these elements of the Paris Agreement rule book.

Accordingly, the outcomes of the Bangkok session, captured in a compilation document.

Under the Enhanced Transparency Framework, the objective of generating comprehensive information on loss and damage to inform the Global Stocktake has been inserted (see paragraph 1.m here). A separate section on L&D information had already been included in draft text prior to Bangkok and is included in an expanded set of options (see D.7 here). In addition, references to L&D under respective sections addressing information on support provided, needed and received have been retained.

In the context of the Global Stocktake, a previous suggestion to establish a separate process for synthesising L&D (a so-called “workstream”) is no longer reflected in the Bangkok outcomes. Instead an option suggests that the assessment of mitigation, adaptation and means of implementation should be done “taking into account loss and damage” (see sub-option 1.1. here). What is also new is the insertion that sources of input should cover loss and damage (paragraph 58g here). Not captured in the document (but hopefully elsewhere) is the idea, shared by AOSIS, that the UNFCCC secretariat prepare a synthesis on L&D information under the guidance of the Warsaw International Mechanism for Loss and Damage.

Under Finance, both AOSIS and LDCs had previously suggested that developed countries should provide information on the support for L&D they plan to provide under Article 9.5. These positions were maintained (see here for AOSIS inputs and here for LDCs inputs). In addition, finance negotiations relevant to the Enhanced Transparency Framework continued. The types of information on “support provided and mobilised” are negotiated under a separate theme (Article 9.7 under SBSTA agenda item 13) but will ultimately feed into the Enhanced Transparency Framework. Here too, AOSIS and LDCs have proposed L&D as a category of support that should be reported on, and these references have been retained (see paragraph 4f here).

What’s next

All this might sound well and good. There is ample reference to L&D in relevant places, reflected in the current version of the different texts. If accepted, developing countries would report on their needs regarding L&D under the Enhanced Transparency Framework, as well as the support they have received. Developed countries would share their side of the story – sharing information on support for L&D provided. In the Global Stocktake, information on L&D would be systematically collected, synthesised and presented under the separate category of “L&D”. Such information could provide a measure of our collective success or failure to mitigate and adapt. It would signal the rising costs of inaction and provide a clear picture of who bears these costs. And developed countries could showcase how much they intend to support developing countries in coping with the consequences of unavoided climate impacts in the future.

But none of the references to L&D are yet agreed and delegates were far from consensus in the negotiating rooms. Many developed countries object to these inclusions of L&D. While developing countries see L&D as a theme to be considered alongside and at the same level as mitigation and adaptation, many developed countries claim that L&D is sufficiently dealt with under the Warsaw International Mechanism on Loss and Damage – a technical body set up under the UNFCCC.

All in all, and as so often is the case, building an information base on L&D and related activities – and agreeing to a collective assessment of L&D – is challenging. But simply ignoring the issue will most certainly not make it go away. Integrating L&D in the Paris Agreement rule book provides yet another opportunity to address this daunting task in the positive spirit of multilateral cooperation and to further enhance international cooperation on climate action. Whether we will use or miss this opportunity will be decided in Katowice this December.