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UN Climate Summit to set up role for markets in Paris agreement
GENEVA, 17 September –Next week’s summit of world leaders, hosted by the UN Secretary-General, is a prime opportunity for governments to confirm a role for markets in the 2015 Paris climate agreement through their support or carbon pricing, says the International Emissions Trading Association (IETA).
UN Secretary-General Ban Ki-moon is hosting the one-day Climate Change Summit on 23 September at the UN Headquarters in New York City. The aim of the meeting is to build political momentum for a deal in Paris at the end of 2015. Negotiations begin in earnest in Lima this December, when governments will begin to focus on specific texts for the Paris agreement.
In recent weeks, IETA joined the World Bank in encouraging businesses and governments to support a joint statement for long-term carbon pricing throughout the global economy. The full list of signatories will be presented on 23 September.
“The Joint Statement on Carbon Pricing offers world leaders a golden opportunity to highlight what really matters in mobilising business to reduce emissions,” says Dirk Forrister, President and CEO of IETA. “The market elements of the Paris agreement are essential, because they give businesses incentives to reduce emissions – and allow them to grow and prosper by keeping costs down.”
“Looking at action on the ground around the world, it’s impressive to see governments increasingly turning to market forces to cut emissions,” says Forrister. “The Paris agreement needs to support these efforts and offer a system to link these systems over time.”
About 60 national and sub-national jurisdictions have introduced a carbon price1, and more carbon markets are under development or close to implementation, including in China, South Korea, Kazakhstan, Turkey, Mexico, Brazil and Costa Rica. Some nations are exploring carbon taxes, but IETA’s strong preference is for emissions trading policies – emissions markets are better at determining pricing than government tax planners, in addition to achieving greater net emission reductions.
“The more governments that back carbon pricing and markets now, the better the chances are that markets will be included in the Paris deal,” continues Forrister. “Business eagerly awaits this signal from leaders next week. The sooner that signal comes, the sooner business will start to invest in the clean technologies of tomorrow, full of confidence that a strong carbon price is on the way.”
Jeff Swartz, IETA’s director of international policy, adds: “The last few years have seen a growing number of new emissions markets come to life, and more are still in the pipeline. Knowing that these efforts would be recognised in the future climate regime could spur more activity, and even encourage more action. The summit could be a real catalyst for market solutions.”
Attention will also be paid to international climate finance commitments and government pledges to the new UN Green Climate Fund (GCF).
“Finance to support mitigation and resilience efforts in the world’s developing regions is urgently needed,” says Katie Sullivan, IETA’s director of climate finance. “The private sector is keen to invest, but the GCF needs to be seeded by governments before it can start to leverage private capital. More commitments are expected in the coming months, but seeing more pledges in New York – or hints that pledges are coming after the GCF’s October Board meeting and before UN climate talks in Lima in December – would really help build momentum.”
IETA will have a team on the ground in New York next week. Please email email@example.com for any media enquiries. We will also be hosting a series of events, including an invite-only symposium on carbon pricing with the Harvard Project on Climate Agreements on 22 September and our annual Carbon Forum North America event on 23 September at Morgan Stanley. Please see www.ieta.org for more information.
1 See the World Bank’s State and Trends of Carbon Pricing 2014 report for more information.
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