IATP said that most of the work proposed for agriculture in the SBSTA has concerned projects to reduce carbon dioxide emissions in developing country agriculture. IATP contends that since methane and nitrous oxide emissions from industrialized animal production and the overuse of synthetic fertilizers in developed countries are far more damaging to the climate than carbon dioxide, SBSTA should study how to reduce those emissions. IATP also recommended that UNFCCC governments (Parties) request SBSTA to review studies of how ecological agricultural practices and the localization of food systems could reduce GHG emissions derived from agricultural production, processing and transportation. We reiterated that the priority for climate investment in developing-country agriculture should be for the adaptation of small land holder agriculture to climate change.
During and after the UNFCCC Conference of Parties (CoP) in Durban, South Africa, the carbon emissions price, whose increase, in theory, should induce major GHG producers to invest in low carbon technologies and production practices, kept falling. IATP, in a second paper, showed that carbon emissions market revenues have been a miniscule source of emissions reduction project finance and suggested that the LCA discuss other approaches to finance. We proposed that an LCA workshop could review new climate economics research to help calculate emissions reduction investments on the basis of estimated loss and damage from climate change, rather than on the basis of the weak and erratic carbon price signal.
Because the old market mechanism of carbon emissions trading has not been working to reduce GHGs, some Parties are proposing a UNFCCC definition for a New Market Mechanism (NMM). Under one proposal, the NMM would continue the old market mechanism practice of having governments give to major GHG producers carbon emissions credits worth billions of dollars (actually euros) when traded on carbon markets, all before having actually reduced their GHG emissions. Another NMM proposal, called “sectoral crediting,” would estimate emissions reductions over an entire economic sector, e.g., the cement industry, rather on the current emission reduction project basis. This accounting flexibility scheme is supposed to make emissions reductions more “cost effective” for major emitting Parties.
Unmentioned in the LCA discussion about the NMM is the green sectoral bond, a financing tool that would tie carbon emissions trading to the bond market and to “sectoral crediting.” Developing country green sectoral bond debt likely would likely be much greater than any benefits developing countries would receive from bond-funded projects. IATP urged the LCA to scrutinize green sectoral bond proposals in a workshop at the UNFCCC negotiations in May in Bonn before agreeing on any elements of a NMM definition.
IATP, in a 2010 article, referred to the green sectoral bond, as ‘the new climate debt,’ a diplomatic reversal of the concept of ‘climate debt,’ according to which developed countries, which bear the majority of historical responsibility for increased greenhouse gas emissions, should pay for the technology and programs to enable developing countries to reduce greenhouse gases and adapt to climate change. At the Durban CoP, the United States succeeded in eliminating the principle of historical responsibility from the terms of reference for the negotiation of a new protocol to the UNFCCC. At the CoP in November in Doha, Qatar, developed countries will try to operationalize the flight from historical responsibility by defining a NMM whose projects to reduce GHGs will be paid for increasingly by developing countries.