Spotlight on helping poor nations shift to cleaner energy

LONDON • The world's richest governments are under mounting pressure to help poor countries fight climate change. At the Group of Seven (G-7) summit in Britain, they will get a fresh chance to do something about it.

On the agenda is a discussion on how to help finance a shift to cleaner energy in low-income countries.

Observers are looking for a pledge from the group to steer the recovery from the pandemic in a greener, fairer direction.

A draft document seen by Bloomberg News ahead of the summit includes a commitment for each G-7 member to increase its financial contributions to help the poorest countries decarbonise.

Specifics are still under discussion. Canadian Prime Minister Justin Trudeau is expected to announce new funding, according to a source familiar with the matter.

A strong declaration from the G-7 could help build trust internationally. In 2009, developed countries pledged to collectively devote US$100 billion (S$132 billion) annually to climate transition in poorer countries by last year. The latest data shows they are still well short of achieving that target.

Concrete action this week could also rally other countries to step up their ambition at this year's United Nations climate change conference, scheduled to be held in Glasgow in November.

The aim, affirmed in the 2015 UN Paris Climate Agreement, is to put the world on a path to limiting global temperature increases to less than 2 deg C, striving for 1.5 deg C if possible.

Poor countries say they need funding if they are to invest in the technologies needed to wean themselves off fossil fuels, while also dealing with the worst impacts of global warming, such as rising sea levels and heat waves.

Rich countries - many of which were able to develop over the last century while spewing greenhouse gases into the atmosphere - agreed to help pay via their US$100 billion-a-year commitment, made at a 2009 UN climate summit in Copenhagen.

Climate finance mobilised by developed countries reached US$78.9 billion in 2018, according to the latest data from the Organisation for Economic Cooperation and Development. The funding comes from a mixture of sources, including private and public institutions.

Donor countries and multilateral development banks are under pressure to ensure that half of the money goes into adaptation, or adjusting to climate change, not just cutting carbon emissions. At the moment, just a fifth of the funding goes to adaptation and resilience.

Few rich countries have set out their plans to increase climate funding for low-income nations. Britain, Luxembourg and New Zealand are the only three nations to announce planned multi-year increases in their climate finance, according to a report by Care Denmark. The non-profit concluded that international funding would increase by just US$1.6 billion this year and next, compared with the amount in 2019.

To show a clear commitment, G-7 leaders must jointly accept responsibility for reaching the US$100 billion goal, while also individually promising to double their finance pledges, said Mr Eddy Perez of Climate Action Network Canada. Countries also need to announce new donations at the summit, he said.

The draft summit document promises more funding to help the developing world cut carbon emissions, but the details still are not clear and nothing has been officially agreed. One potential initiative expected to be discussed at the summit is the Clean Green Initiative, an alternative to China's Belt and Road infrastructure strategy, two sources familiar with the matter said last week.

BLOOMBERG

A version of this article appeared in the print edition of The Straits Times on June 12, 2021, with the headline 'Spotlight on helping poor nations shift to cleaner energy'. Subscribe