Why Climate Finance Matters to Real People

December 22, 2015 | 5:33 pm
Katharine Hayhoe

We humans are used to the climate of the places where we live, regardless of how extreme they may be. I witnessed this first-hand during my time in Churchill with Polar Bears International, just a few weeks before COP21. While we were there to track the bears, I found that locals were waiting just as impatiently for the water to freeze and snow to fall, so they could head out to their cabins and trap lines. For all who live in the Arctic, life begins in the winter. But this winter—as in so many winters, lately – the sea ice was late to come, and both bears and people remained trapped on land well into December.

People in the Arctic aren’t the only ones: farmers rely on predictable climate to feed their livestock and ensure their harvests are profitable. City infrastructure is carefully built to withstand historical weather extremes. But as climate is changing, it’s making it harder for farmers to earn a consistent living off their land; harder for cities to cope with increased risks of flooding or water shortages, or both; and more difficult for the elderly, young, and poor to survive extreme heat waves and cold snaps.

Heavy downpours are increasing nationally, especially over the last three to five decades, with the largest increases in the Midwest and Northeast. Increases in extreme precipitation are projected for all U.S. regions. Source: Third National Climate Assessment. U.S. Global Change Research Program

Heavy downpours are increasing nationally, especially over the last three to five decades, with the largest increases in the Midwest and Northeast. Increases in extreme precipitation are projected for all U.S. regions. Source: Third National Climate Assessment. U.S. Global Change Research Program

These problems are worrisome in developed nations, where the frequency of extreme precipitation has increased by 37 percent across the U.S. Midwest in the last 55 years and Farmer’s Insurance temporarily sued the city of Chicago for failing to adequately prepare for the impacts of climate change; when two devastating years of crop losses throughout the U.S. Great Plains (the result of natural drought patterns exacerbated by unnaturally record-breaking heat) were followed by a recommendation by the U.S. Government Accountability Office’s to reduce crop insurance; and where the impact of a heatwave in 2003, the risks of which had already doubled due to human-induced climate change, resulted in over 70,000 premature deaths across France and northern Europe. In developing nations, however, which lack the safety net of infrastructure, public services, and insurance, such issues can be orders of magnitude more devastating.

Although much of the focus at COP21, and in the days afterwards, has been on the emission reductions needed to achieve the given targets, for developing nations the real issue on the table was climate finance: funds to support climate mitigation and adaptation, which up until now have been vastly inadequate to alleviate the local effects of climate change while enabling such nations to continue to develop.

Equitable financing has always been at the forefront of international climate negotiations. Emissions-heavy countries care more about mitigation and bear a greater historical responsibility. Developing countries produce little emissions but are experiencing the brunt of the impacts. According to a recent report by Oxfam America, the richest 10 percent in the world produce half of the world’s carbon emissions, while half of the poorest are responsible for just 10 percent of emissions. The two sides to the equation are unequal.

Greenhouse gas emissions by country, 2005. Credit: Wikipedia.

Greenhouse gas emissions by country, 2005. Credit: Wikipedia.

The purpose of the financing discussed at COP21 is to assuage these differences. But currently much more money goes toward mitigation than to adaptation. This imbalance becomes particularly troubling when we know that the local effects of climate change are increasing, the gap between rich and poor is widening, and that we are locked into a certain amount of warming even if we stopped producing emissions this very second (if it were only that easy!). According to Alden Meyer, Director of Strategy and Policy for the Union of Concerned Scientists, the division between rich and poor is arbitrary, and getting more ambition from countries in equitable ways is difficult. This is one of the reasons why equity became one of the “down-to-the-wire” issues in the Paris climate talks—how to set fair emission reduction targets between developed and developing countries and delegating responsibility for financing. Developed nations have been unwilling to establish more aggressive mitigation goals, while developing countries that have not been as responsible historically (remember, just 10 percent) are concerned that equal emissions targets will inhibit opportunities for economic development.

New financing mechanisms to help countries mitigate and adapt to climate change were proposed in 2009 to try and resolve some of these differences. The 2009 Copenhagen Accord resulted in a pledge of $100 billion by the year 2020 by developed countries to help developing countries deal with climate change. The following year during the COP16 meeting in Cancun, the Green Climate Fund (GCF) was established to help countries reach this $100 billion goal. The GCF receives funds from governments and the private sector, with $10.2 billion in pledges as of October 2015, signifying that the international community is committed to building resilience to climate change.

The GCF is very important, but it will not take us to our goal. As Meyer put it, “the GCF is one part of the finance architecture but it is not the lion’s share of funds.” The initial capitalization of GCF funds is $10 billion spread out over a number of years. One important guideline contained in the GCF is that 50 percent of its financing will be for adaptation. Right now, only about 15-20 percent of the finance is going to adaptation—far from 50 percent (although it is important to note that many mitigation and adaptation strategies share co-benefits, meaning funding adaptation can often contribute to mitigation, and vice versa). Part of the reason is that private sector funds go much more often to mitigation and green energy technology; it is much harder to get private sector funding for adaptation. Will developed countries meet the commitment they made in Copenhagen in 2009 to mobilize $100 billion from public and private sources in climate finance by 2020?

Many countries do not have time to wait and see. That’s why organizations like Oxfam, whose goals are to end poverty, hunger, and injustice, are moving forward and developing innovative programs and initiatives that are helping to build local capacity and increase resilience to such extremes. In 2010, Oxfam launched the R4 Rural Resilience Initiative to help farmers around the world manage their risks to disasters and secure their livelihoods. In 2014 alone, R4 provided drought insurance to over 26,000 farmers in Ethiopia and Senegal, helping people learn how to become more resilient.

Selas Samson Biru, a 50-year-old farmer in a remote Ethiopian village called Adi Ha, is one of the many farmers who have benefited. Increased climate variability has led to more uncertainty from year-to-year, putting her crops and livelihood in jeopardy. Now equipped with a new tool to manage drought risks, Biru receives payouts for crops she has insured. And when her weather insurance became available, Biru joined other farmers to buy an irrigation pump. This investment has provided more abundant, profitable harvests.

Farmers in drought-stricken parts of Texas similarly find their livelihoods threatened by the growing unpredictability in climate and weather. West Texas is well accustomed to droughts. Farmers here have traditionally relied on playa lakes—surface depressions that fill with water during certain times of year—but playas can no longer sustain farmers through severe droughts. Instead, farmers are implementing new technologies to manage changing risks and stay afloat. Andy Timmons, a grape producer in West Texas, moved away from farming row crops and started growing grapes to diversify his operations – a decision he made as he began losing confidence in the Farm Bill and federal commitments to agriculture, which he says are “going away.” Even though grapes adapt to extreme weather better than row crops, he has to cultivate his vineyard differently every year, testing new irrigation strategies to continue to increase production. To deal with early spring freezes during dry years, he installed wind machines to circulate air and keep it from stagnating so grapes wouldn’t freeze. Timmons had the resources to adapt – but Biru and many other farmers in developing nations don’t.

A successful climate agreement at COP21 and beyond isn’t just about reducing our emissions: it’s about helping people—real people—adapt to the changes we cannot avoid. The $100 billion pledge, including the GCF, is an encouraging start. However, much of the money has only been “announced” and not yet disbursed. Actions at the ground level also seem to be outpacing top-down funding mechanisms. While countries continue working out ways to reach the $100 billion financing goal, stories like Biru’s and Timmons’s remind us of the importance of ground-up grassroots actions that are already helping to build local knowledge and resilience. Are there examples you can share from your community?