SHARM EL-SHEIKH, Egypt (AP) – When it comes to helping poor countries cope with climate change, the United States government has left the purse strings at home. So it’s hoping its friend, big business, will help pick up the tab.
Unable to convince Congress or the American public to spend billions of dollars more a year on climate finance, the US government is trying to make it easier for private corporations to send money to the developing world instead to see green at home.
The plan, announced Wednesday by US climate envoy John Kerry at the COP27 climate summit in Egypt, essentially amounts to tapping private funds to finance the transition of developing countries to clean energy through to sell “high quality” carbon credits to companies trying to make their carbon emissions “net zero.”
“Our goal is to put the carbon market to work, to spread capital that cannot be employed, to accelerate the transition from dirty to clean power,” and replace dirty power plants that are fired of coal with energy sources, Kerry said at a launch event.
But the idea has faced stiff resistance from environmental groups and climate experts, who say it would give polluters a license to keep polluting. It came a day after the United Nations warned about shady carbon credits that businesses rely on to meet their net-zero targets.
Highlighting the opposition, an activist taunted Kerry as he launched the plan, accusing him of “promoting the wrong solutions,” before being shooed away by security guards. At this year’s COP summit, poor countries mocked the rich for not putting up enough money to finance what they call a green transition.
The developed world needs hundreds of billions of dollars to help them get rid of coal, oil and natural gas, but the United States Congress is reluctant to spend more financial aid.
“If we don’t find more money … we can’t do it,” Kerry said of the fight against climate change.
Kerry’s proposal is called the Energy Transition Accelerator and is supported by two major philanthropies, The Rockefeller Foundation and the Bezos Earth Fund. They hope to be able to unlock $100 billion or more in financing for green projects by 2030. Kerry said he wants to keep it up and running at next year’s COP meeting.
Details about how it will work are scant, but under the plan, proven reductions in greenhouse gas emissions could be traded as carbon credits. Kerry said there was “strong interest” in buying it from corporations including PepsiCo and Microsoft.
There are “strong safeguards” on who can buy the credits, Kerry said. Buyers, “not including fossil fuel companies,” would need a goal for getting to net-zero carbon dioxide emissions and an interim science-based target on the way to achieving that goal, he said. Credits cannot be used as substitutes for making deep cuts in their own emissions but as an additional incentive to efforts.
Unlike other carbon credits that have been criticized as prone to abuse, these credits will only be allowed to be used to phase out coal-fired power plants in developing countries and create more renewables. power and limited time, said Kerry. That, he said, would be “guardrails against abuse.”
Carbon credits have grown into a multibillion-dollar market for companies, governments and individuals who want to reduce their carbon footprint. But they have also become a source of controversy among environmental and climate activists, who say they are problematic because there is no guarantee they will deliver a reduction in emissions.
The basic idea is that emissions from polluting human activities can be offset elsewhere, through farming practices that store carbon, planting trees, or by capturing greenhouse gases. of the climate from smokestacks and other equipment.
These activities are monetized and sold as offsets and are popular with companies that make them part of their net-zero plans.
On Tuesday, a UN expert panel warned that stricter standards are needed to combat greenwashing by companies and investors who make net-zero commitments, including bans on businesses and local government to buy cheap carbon credits that lack integrity instead of significantly cutting their own emissions. .
The idea proposed on Wednesday faced considerable skepticism.
Mohamed Adow, director of Power Shift Africa, a climate and energy think tank, called carbon offsets an “accounting trick” that paves the way for big polluters to continue polluting.
Big cuts in greenhouse gas emissions in rich Northern countries and developing countries in the global South are needed, Adow said, “not rich polluting companies in the North paying for the privilege of continuing to destroy the planet.”
“John Kerry knows climate science, he knows what’s at stake for people, and yet what he’s proposing in his offsets threatens to undermine global efforts to cut emissions, ” said Adow.
Climate scientist Bill Hare of Climate Analytics, who is on the United Nations expert panel, said the proposal surprised people at the climate summit and angered many governments.
“The reason why is because we’re at a stage in history right now where everybody has to reduce emissions. And the implications of John Kerry’s proposal is that companies don’t have to reduce emissions when they buy offsets.
A senior European official expressed skepticism at the US proposal before the launch.
“I think there are, in some circles, a lot of concerns,” said the official, who spoke on condition of anonymity because of the sensitivity of the issue.
Micah Carpenter-Lott, the activist who mocked Kerry, said he wanted to draw attention to the inaction of big polluters and rich countries and the “false solutions” presented in Kerry’s plan.
“We don’t have to cooperate with the polluters,” Carpenter-Lott, an indigenous justice activist from the Northern Arapaho tribe in the US, told The Associated Press moments after she was kicked out of the US pavilion. “The polluters should not be in this space, and they should not be allowed to form partnerships with governments because that will not solve the climate crisis.”
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AP writer Frank Jordans contributed to this report.
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