ACTION
Assessing Climate TransItion OptioNs: policy vs impacts

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Be a Marie Sklodowska-Curie fellow at the time of Covid-19

27/07/2020
When I received my Marie Sklodowska-Curie award notification letter, in 2019, I could only think of the three exciting years ahead. With a mix of fear and excitement I started preparing to move in another country, where I would have had the opportunity to work with wonderful people, develop my own project and acquire additional expertise. I was somehow aware of the fact that I was going to face some challenges but the idea that something totally unpredictable, like a pandemic, could change my plans was absolutely far from my thoughts.

Not even at the beginning of February, when my fellowship started amid the first news about rising COVID-19 cases in Europe and the US, I was actually aware of the extent of the consequences.

After the first meeting with my supervisor, I started to participate to the lively Harvard campus activities, including lunch seminars and classes. I started to regularly go to my office, and to have first small chats with my new colleagues…until March 10th , the day Harvard University announced the decision to move all activities remotely to protect the health of its community. I have spent a total of one month at my desk at the Kennedy School.

Project-wise, I would not say that it was so disruptive, as large part of my research can be done anywhere there is a laptop and a good internet connection. Overall, I feel I have been luckier than many colleagues working in the labs or in the field.  However, I must admit that being confined home at the beginning of a new project, when exchanging ideas with colleagues or getting advice from experts met at gatherings have an important role, was a bit difficult to manage. Also, the fact that I had just moved in a new country, the worries about health insurance coverage or about the safety of family and friends in Italy, added an unusual mental burden.

Harvard University made a great effort to create an inclusive and effective virtual environment. I was able to keep attending classes remotely and, although many seminar series were cancelled, my supervisor organized different groups of discussion to keep PhDs and postdoc fellows connected. Spontaneous virtual happy hours and social gatherings started to pop up, both inside and outside the working environment. All these activities make me feel part of a huge community, committed to help and support each other. I am grateful also to the European Commission, that promptly showed flexibility in managing the project, even allowing fellows to go back to their home country during this period of remote working. Through the official Marie Curie Alumni Association, I also found that a big Bostonian family of Marie Sklodowska-Curie fellows is there, ready to help, share their experience and make fun to forget the pandemic for a few hours.

Beyond personal feelings, these trying times offer un unprecedented opportunity to reflect on our relationship with the surrounding environment and the type of society we want in the future. This crisis shows us that in a now fully interconnected socio-economic system it is difficult to cope with a public health emergency without causing impacts on other sectors of the economy.

This has a lot in common with climate change. The impacts of climate change involve a wide range of sectors, including health and economics. Climate changes have been indeed defined as a threat multiplier because they interact with the vulnerabilities already existing in our society. For this reason, we need to seize the opportunity to act thinking to the long-term, to exploit the synergies between policies for the economic recovery and climate ones to build a truly resilient society, able to protect the most vulnerable in this and other future challenges.

The peculiarity of policies to combat climate change, however, is that the action of individual governments is not enough. A drastic reduction in CO2 emissions necessarily requires a coordinated response from world countries. The good news is that if we act now there will be less need for policies as aggressive and invasive as the ones we have seen in recent months.

The Paris agreement: key points and future prospects

22/06/2020
December 12, 2015 has taken its place in the history of the fight against climate change as the date on which 195 countries succeeded in finding a common agreement for reducing anthropogenic emissions and handling the impacts of rising global temperature.

After years of negotiations, and with the still fresh memory of the Copenhagen Conference, which in 2009 had failed to produce the desired result, countries met in Paris from November 30th to December 12th, for two weeks of intensive negotiations aimed at defining “a new protocol or other legal instrument with legal force under the Framework Convention, applicable to all Parties.” In carrying out this mandate, entrusted to them in Durban (South Africa) in 2011, national delegates from around the world had to find a compromise on several key issues. The final agreement can be considered a step ahead, albeit insufficient, for reasons we shall see. More than 190 countries committing themselves to controlling their greenhouse gas emissions is a positive historic event, whatever the doubts and misgivings for much that remains to be done to limit the negative impacts that climate change is having on our societies.

But what does the Paris Agreement call for? First of all, the agreement is built around three main objectives:

  1. limiting the increase in global average temperature to well below 2°C above pre-industrial levels and pursuing efforts to limit it to 1.5°C, as this would significantly reduce the risks and impacts due to climate change;
  2. increasing the capacity to adapt to the adverse impacts of climate change, promoting resilience and adaptation investments in developing countries, in particular to reduce threats to food production;
  3. making adequate financial resources available to support a climate-resilient and low-carbon economic development.

To achieve each of these objectives, the document outlines a range of measures, which will guide the actions of countries from 2020 onwards. In particular, for the objective of limiting the increase in temperature below the 2°C safety threshold set by the scientific community, the Paris Agreement aims at:

  1. achieving a peak of global emissions of greenhouse gases as soon as possible and then bringing about a rapid reduction until, in the second half of the century, a parity is achieved between emissions produced and those absorbed. One tool for reaching these objectives are the “intended nationally  determined contributions”: mitigation efforts that are progressive over time and that all UNFCCC Party Countries are called on to undertake and communicate;
  2. providing support and flexibility for developing countries, which may need more time before achieving a trend of decreasing emissions, and whose need for financial and technological support for the implementation of these commitments is recognized in different parts of the text;
  3. assigning to developed countries a leading role in mitigation action through absolute targets for reducing domestic emissions, while developing countries will be able to increase their emissions, though reducing them to what they would have been without the adoption of their INDCs, and being encouraged to eventually undertake broader reduction targets;
  4. asking each country to update its national contributions every five years, by providing all the information needed to ensure clarity and transparency. Cooperation mechanisms, including market mechanisms to lower implementation costs, may be undertaken voluntarily by countries, if this serves to increase the ambition of the action and if environmental integrity is respected.

In addition to mitigation, important recognition is given to the role of adaptation, since even if the limit of 2°C was observed, some of the impacts of climate change will be unavoidable. In general, the Paris Agreement defines adaptation as a multi-level global challenge, from local to international, as well as a key component of the response to climate change in the long term. For this reason, the Paris agreement:

  1. recognizes the need for adaptation of developing countries and the consequent efforts to meet them, along with the need to strengthen international cooperation in favor of the most vulnerable countries;
  2. encourages all countries to implement measures and adaptation plans, both nationally and cooperatively, and to communicate and update them periodically as part of their national contributions;
  3. commits developed countries to implementing measures of technological cooperation and transfer of technology in favor of developing countries in order to help them cope with the by now inevitable impacts of climate change.

Nevertheless, the Paris Agreement stipulates that the developed countries should continue to provide financial support to developing countries, on an increasing scale and through a wide variety of sources and methods. Information on this support, its scope and layout, is to be communicated by each country every two years. Special attention should be given to communicating the contribution made by national public funds, even though support from other countries or private stakeholders is still encouraged. As with much of the Agreement, additional guidance is furnished by the implementing provisions, which, in this case, state that before 2025 governments will have to establish a new collective financial commitment and that the starting point will be the amount determined by the previous negotiations for 2020, namely 100 billion dollars per year.

Lastly, a crucial point is the review process of the agreement’s implementation, which will be set up starting in 2023 and repeated subsequently every 5 years in order to assess progress in collectively achieving the long-term objectives. The review will cover all the key elements of the Paris Agreement: first, an assessment of national contributions to mitigation, but also adaptation actions, financial commitments, even in the light of future scientific results provided by the IPCC. The results of this process will be used to inform and update subsequent national contributions and the actions that the parties will be called on to provide. Taking into account the concerns of those countries that believed this date to be too far off in time, especially in light of the analysis of the mitigation commitments, an initial assessment will be made as early as 2018, intended however as an informative dialogue for outlining the next national contributions.

From a legal perspective, the Paris Agreement has formalized a new approach consisting on the one hand of a legally binding part that establishes common rules to promote a transparent process and to ensure an assessment of its objectives, supported by elements left to the national legislation of each State, for example the INDCs. This “hybrid” solution was dictated by the need to obtain a large consensus on the final document and thus provide a tool that is receivable in national legislations without much difficulty. The rigid distinction included in the Kyoto Protocol, among Annex I states, with binding reduction commitments as opposed to non-Annex I states, which had none, has been replaced by a new more nuanced and flexible form of differentiation that simply distinguishes developed countries from developing countries. Many provisions establish common rules and commitments, yet allow respect for the different national circumstances and capabilities of the poorer countries, through both the so-called “self-differentiation” implicitly included in the national contributions, and more detailed rules, as in the case of financial support.

The Paris Agreement has learned from past mistakes and has tried to respond to the urgency for climate action by encouraging the widest possible participation (even though giving up some elements that would increase its effectiveness). From this point of view, the agreement can certainly be considered a success.

Although more than 190 countries have indicated their national contributions, making up more than 98% of global emissions, they are not yet sufficient to limit a temperature rise to below 2°C compared to pre-industrial levels. Starting with the UNFCCC itself, several studies have evaluated the aggregate effect of the Paris agreement, stressing that further reductions will be needed after 2030, otherwise the temperature increase at the end of the century will be closer to 3°C than to 2°C. Much will depend on what the countries will be able to accomplish after 2030. If emissions decline rapidly and if we acquire technologies capable of removing CO2 from the atmosphere on a large scale, then the 2°C target will be achieved. Otherwise we will have to adapt to a very different climate from what we have now.

It is obvious that the more we postpone significant emission reductions, the more ambitious they will have to be in the future. For this reason, the review and update process on the commitments outlined in the Paris Agreement will play a key role in promoting increasingly ambitious actions.

Likewise, the mobilization of financial resources to enable developing countries to implement mitigation and adaptation plans, as well as those that all countries will invest in research, development and transfer of new technologies, will be crucial for achieving the goals that have been set.

A recent study by the Organization for Economic Cooperation and Development (OECD), shows that in 2017 the developed countries provided 71.2 billion US dollars to developing countries, 75% of which came from public funds (see barpolt). Just as significant is the fact that the number has grown in recent years, because of both the increasing commitment of governments and increasingly transparent reporting systems. However, the figure is still far from the needs of the developing world, estimated by the World Bank as 140-175 billion dollars a year by 2030 for mitigation actions and another 75-100 billion for adaptation.

Climate finance provided and mobilised by developed countries, annual flows 2013 to 2017 in USD billion, by category (Mobilised private, Export credits, Multilateral public, Bilateral public).
Source: OECD 2019

Overall, the Paris Agreement is an important step in the right direction. A realistic step, which will enable governments to work together within a robust process of review and growth in commitments. The Paris conference has therefore closed one cycle, that of the Kyoto Protocol, and opened up another, larger one in terms of participation based on past achievements, but open to future improvements. It is now up to the individual countries to adopt concrete mitigation and adaptation measures. In particular, there are some very important decisions to be taken urgently:

  1. Investing significant resources, quadrupling those invested today, in research and development of low-carbon technologies, especially for producing electricity and for its use and storage. Research and development of technologies for CO2 removal from the atmosphere, to reduce energy and water poverty, for developing climate-resistant seed, and for low-cost dissemination of education programs throughout the world.
  2. Taking steps to reduce the consumption of fossil fuels, starting with coal, which should be eliminated at least in all the industrialized countries, and replaced by gas.
  3. Promoting the replacement of fossil fuels with renewable energy by eliminating subsidies to the former and using the financial resources so obtained to fund research on the latter.
  4. Taking measures to make sure that every ton of carbon emitted has a price that will encourage technological innovation, energy efficiency and the gradual replacement of fossil fuels with renewable energies.

Thus, we need far-sighted public and private investment decisions. In Paris one important role was played by the private sector, which for the first time has made important commitments to reduce emissions of greenhouse gases. More generally, one key success of COP 21 was also the mobilization of the civil society and local institutions: the mayors of major cities, private companies, activity and research networks, and the actions of many NGOs are showing how change is possible and above all an opportunity.

Why are climate policies important?

5/06/2020

Temperature increase in the last 100 years was about 0.8°C (IPCC, 2014). The last decade was the warmest decade on record, with the past five years being the warmest of the last 140 years.

Earth’s global surface temperature in 2019 was the second warmest since modern record-keeping began in 1880, and 0.98°C (1.8 degrees Fahrenheit) warmer than the 1951-1980 mean, according to NASA (see the NASA video about "Global Temperature Anomalies from 1880 to 2019"). Overall, 2019 temperatures were second only to those registered in 2016.

Studies based on historical data demonstrate that changes in climate variables influence social and economic outcomes in many sectors and contexts, including mortality, assets’ loss, agriculture, labour productivity, electricity, aggregate economic indicators migration, but also aggression, violence, and conflict (Carleton and Hsiang, 2016)

To avoid dangerous impacts of climate change, urgent policies are needed to drastically cut GHG emissions in the next decades. Although there is broad evidence of the overall co-benefits associated with strong and early mitigation actions and of the fact that they will outweigh the costs, governments need to promote comprehensive policies able to reduce emissions at the lowest possible cost. This is why putting a price on carbon emissions is a key component of national efforts to tackle climate change. Carbon pricing policies include market-based instruments, accompanied by better integration of climate change objectives across relevant policy areas such as energy, transport, building, agriculture or forestry, and other measures to speed technological innovation.

Since the early 1990s the European governments and other developed countries have adopted national programmes aimed at reducing emissions. To coordinate the efforts at the international level, world leaders meet every year within the United Nations Framework Convention on Climate Change (UNFCCC), where they adopted the Kyoto Protocol in 1997 and, at the end of 2015, the Paris Agreement. 
The Paris Agreement affirms the urgency to tackle climate change and foster a climate-resilient and inclusive low-carbon development. The pledge-and-review approach launched by the Agreement requires more than 190 States to periodically update their climate plans toward more and more ambitious actions. This provides an unprecedented opportunity to learn about domestic priorities on climate change policy. At the same time, it calls for new systematic tools to track countries’ commitment toward the achievement of global objectives (i.e. limiting the average temperature increase well below 2°C) as well as for a comparison, which considers synergies and adverse impacts arising from national specificities. 

Falling at the intersection of public policy, climate change economics and climate science, my Marie Skłodowska Curie project, ACTION, will develop a quantitative approach to empirically evaluate national climate policies in terms of stringency, determinants, and economic impacts. The new evidence provided will enhance transparency and comparability among countries’ climate efforts and offer useful insights into a fair and just transition toward the sustainable development. By assessing the effectiveness of current measures and by identifying successful elements and obstacles, ACTION will support the EU and its Member States to better design their future climate agenda. Research findings will contribute directly to the achievement of the climate change objectives laid out in the EU 2030 Climate & Energy Framework. Moreover, understanding policy stringency and its socioeconomic dynamics in other countries will facilitate the EU to integrate its climate strategy in a wider context, and to play a leading international role in achieving the Sustainable Development Goals.

A brief overview of the project

Type of mitigation contributions submitted under the Paris Agreement (GHG target: 138 parties; Actions only: 22 parties; Non-GHG target and actions: 10 parties; Non-GHG target only: 6 parties; GHG target and non-HG target: 20 parties; No document submitted: 1 party)
Credit: WRI 2020

27/05/2020
The 2015 Paris Agreement is a key step towards strengthening a global response to address the threat of climate change. It sets global objectives that all signatory countries have to contribute to achieve through the implementation of urgent actions to reduce greenhouse gas emissions and promote climate-resilience and low-carbon development. The new bottom-up approach launched in Paris and the large heterogeneity of the contributions (see map) presented saw increased academic attention on how the different types of national targets proposed can be evaluated and compared. 

ACTION – Assessing Climate TransItion OptioNs: policy vs impacts – aims at enhancing transparency and comparability among countries’ climate change policies while offering insights into a fair and just transition toward the sustainable development. The project will develop a quantitative approach to empirically assess national climate policies in terms of severity, drivers and economic impacts.

The overarching objective of ACTION is twofold:

  1. enhance transparency and comparability of climate change measures at different levels while clarifying factors determining policy ambition;
  2. provide evidence on the equitable transition toward a low-carbon and sustainable development.

To achieve these goals, the following specific objectives will be pursued:

  1. Provide a cross-country analysis of climate policy stringency over time:
    1. Create a database of climate change policy measures adopted over the years by countries;
    2. Develop and apply a flexible and replicable set of indicators to assess stringency of existing climate policy measures and to rank countries’ performance. 
  2. 2. Provide evidence of international and national factors influencing climate policy adoption and effectiveness:
    1. Investigate the specific role of the process leading to adoption of the Paris Agreement on the level of stringency of national climate policy:
    2. Empirically investigate the effects of environmental, social, economic and political factors (e.g. institutions, education, economy, political orientation, lobbying, etc.) on individual countries’ policy stringency and emission change for the period considered.
  3. Provide evidence of the comparative effect of climate policy stringency and climate change impacts on inclusive economic development:
    1. Quantify the simultaneous effect of the climate policy stringency indicator and other climate change-related variables (e.g. temperature and precipitation variations, damages induced by climate/natural extreme events) on growth, inequality and poverty. 

The project will exploit the recent increase in availability of climate policy information, both in terms of geographic and temporal coverage, to significantly advance the empirical literature on climate policy evaluation and comparison. The development of a systematic measure to evaluate climate and clean-energy policy stringency will allow not only to consolidate the analytical approach to assess countries’ performance but also to move the understanding of underpinning factors a substantial step forward. Considering the combined effect of policy and impacts on economic development will represent an unprecedented effort toward the assessment of the overall pressure climate change is imposing on our society.


About

ACTION – Assessing Climate TransItion OptioNs: policy vs impacts – aims at enhancing transparency and comparability among countries’ climate change policies while offering insights into a fair and just transition toward the sustainable development.
The project will develop a quantitative approach to empirically assess national climate policies in terms of severity, drivers and economic impacts. Project results will assist policymakers in understanding the effectiveness of coordinated policy efforts and design their future climate agenda. ACTION will be hosted in two highly qualified institutions: during the outgoing phase (24 months) at Harvard Kennedy School of Government, under the guidance of prof. Aldy, and during the incoming phase (12 months) at the Department of Economics of Ca’ Foscari University. The supervisor of the project is prof. Enrica De Cian.