The Realities Of Climate Change And The Challenges Of Climate Finance And Enforcement

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  1. Introduction

Over the years, various treaties and protocols have been agreed, diverse summits have been held and multiple working papers published on the realities and threats of climate change. Indeed, commendable progress has been made by the various institutions charged with the responsibility of devising a solution to the problem of climate change, which has been proved scientifically to be a result of the historical and continuous emission of greenhouse gases into the atmosphere mostly as a result of human induced industrial and other economic activities.

The most prominent of the treaties which have been agreed with the aim of mitigating the causes and adapting to the effects of climate change in the world is the Paris Agreement, with the central aim of strengthening the global response to the threat of climate change by keeping a global temperature rise this century well below 2 degrees Celsius above pre-industrial levels and to pursue efforts to limit the temperature increase even further to 1.5 degrees Celsius. Additionally, the agreement aims to increase the ability of countries to deal with the impact of climate change, and at making finance flows consistent with low greenhouse gas emissions and climate-resilient pathway.[1] To meet these goals, various greenhouse gas emission reduction targets have been set by many countries and corporations, whilst various state actors, institutions and campaigners have held multiple summits on this score.

Notwithstanding the progress that has been made so far, certain issues stand as an albatross, which if not addressed have the capacity to render worthless any agreement that the parties have made, and fatally impede any progress that the world seems to be making in a bid to address the challenges of climate change. Some of these issues will be addressed in this article.

  1. Climate Finance:

First on the menu is the issue of climate finance. It is widely acknowledged that whilst developing countries have contributed the least to the accumulation of greenhouse gases in the atmosphere, they are however, the most vulnerable to the threats of climate change particularly because of their limited capacity to adapt to the threats posed by it. It is projected that developing countries will need hundreds of billions of dollars to adapt to the inevitable warming of the climate and the attendant consequences, which would be very damaging not only to the environment, but also to the livelihood of the people. Developing countries cannot obviously afford the finances needed to mitigate the causes of climate change and adapt to its consequences. Climate finance projects aim to help poor countries avoid the mistakes rich nations made as they grew, by taking immediate steps to mitigate the causes, and adapt to the already existing consequences, of climate change. Mitigation efforts aim at putting appropriate measures in place to ensure that projects are embarked upon that emit less carbon dioxide than might be emitted otherwise, for example building energy efficient infrastructure and transitioning to clean energy sources.[2]

In 2009, under the Copenhagen Accord, developed countries agreed to jointly provide USD100 billion a year by 2020 to less wealthy nations to help them adapt to climate change and mitigate further rises in temperature. That promise was never met, and it does not look like it will be met any time soon.[3] At the 2021 UN Climate Change Conference in Glasgow, Scotland, developed countries made further pledges to provide adaptation finance, to help low and middle-income countries deal with damaging effects of climate change.[4]

How these funding pledges are met will go a long way to determine whether the world is anywhere near meeting the Paris Agreement’s goal of restricting global temperatures to well below 2 degrees Celsius, if not 1.5 degrees Celsius above pre-industrial temperatures. For now, we can only keep our fingers crossed, whilst hoping for the best.

  1. Enforcement of Treaty Obligations:

Another issue that will bedevil any climate agreement is the issue of enforcement. International law is notoriously weak at enforcing treaty obligations because of a lack of enforcement mechanisms. Also, states can easily refuse to sign up to any agreement that they don’t feel comfortable with and even after signing up may decide to withdraw from the treaty if they later feel the need to do so. As a result, most of the emission-reduction agreements over the years have been drafted in very loose terms because when the agreements contain binding commitments, they have proved to be counter-productive. A good example is the Kyoto Protocol, which sought to impose binding commitments on developed countries to reduce emissions by an average of 5.2 percent below 1990 levels between the year 2008 and 2012 and established a system to monitor countries’ progress.

However, the treaty did not compel developing countries, including major carbon emitters like China and India, to take action. The United States signed the agreement in 1998 but never ratified it and later withdrew its signature, mainly for 2 reasons: (1) it felt the Kyoto Protocol was unfair because developing countries, especially China and India were excused from obligations to make emission cuts and (2) it stated that the cost of complying with the Protocol on the American economy would be too high.[5] Canada also withdrew from the Kyoto Protocol in 2011.

In order to avoid these kinds of scenarios, international climate treaties tend not to threaten penalties and instead rely on other political strategies and pressure tactics to ensure cooperation. For example, many countries are required to make formal pledges, referred to as Nationally Determined Contributions pursuant to the 2015 Paris Agreement towards bringing global warming to “well below” 2 degrees Celsius and aim for 1.5 degrees Celsius above pre-industrial levels. The Paris Agreement only requires the parties to aspire to meet these commitments, without imposing any liability for failure to do so. This has so far failed to halt the rise in greenhouse gas emissions and global temperatures.

A way out of this is for countries with a strong commitment to meeting their climate obligations to enact emission-reducing targets into local laws. A few countries have led the way in this regard. For example, the United Kingdom,[6] New Zealand,[7] and the 27-country EU,[8] have fixed individual emission-cutting targets into their own laws. Also, the United States president, on 16th August 2022 signed into law the Inflation Reduction Act of 2022,[9] a consumer-centric law, which among other things, seeks to make what is acclaimed to be “the single largest investment in climate and energy in American history”.

The legislation aims at lowering energy costs, increasing cleaner energy production, and reducing carbon emissions by 40% by 2030.[10] The climate action plan under the Act is incentives based. It proposes incentives of up to $7,500 or $4,000 in tax credits to consumers to purchase new or used electric cars, respectively. Consumers are also provided incentives to warm their homes with heat pumps and to cook their food using electric induction. Provision is equally made for electricity generators to get ten years of tax credits to supply more wind and solar power, which will increase the volume of renewable energy in the energy mix and help cut down reliance on emissions-heavy gas and coal. [11] About $60bn is also provided to help communities that have suffered the most from fossil fuel pollution.[12]

Nigeria, has also taken some significant steps in enacting its own climate change obligations into local law. Nigeria had in 2021 updated its Nationally Determined Contribution towards the Paris Agreement’s goals, and committed itself to take measures aimed at unconditionally reducing its emissions by 20% below business as usual by 2030 and conditionally reduce it by 47% below business as usual by 2030, provided that sufficient international support is assured. Nigeria in 2021 signed the Climate Change Act, 2021, which, among other things, requires Nigeria’s Ministry of Environment to make a carbon budget with a view to keeping average increase in global temperature within 2oC and pursuing efforts to limit the temperature increase to 1.5oC above pre-industrial levels. It further mandates the formulation of a National Climate Change Action Plan in every five-year cycle to ensure that the country’s emission profile is consistent with the carbon budget goals and prescribes measures for identifying actions for climate adaptation and mitigation. The Act applies to both public and private entities within Nigeria’s territorial jurisdiction and directs both to implement mechanisms geared towards fostering a low-carbon emission, environmentally sustainable, and climate resilient society.[13]

Whilst these efforts are commendable, they represent a very tiny drop in the ocean and may not eventually help to achieve the overall goal of limiting global warming to the targeted temperatures, if these countries do not back the legislations with action or if other countries fail to keep to their own part of the bargain. One thing is however, certain for countries with climate change legislations is that they provide a veritable tool for robust climate action to enforce compliance.

Another option may be to apply peer pressure on defaulting state parties. For example, the Paris Agreement includes a five-year “global stock-take” of progress. This will help to give an overview of what effective steps have been taken by each state party towards meeting its commitments under the agreement. This can show which countries are lagging, thus creating a system of peer pressure, which may eventually engender action towards meeting a state’s climate obligations to avoid being named and shamed.

Some other states have been a bit more innovative in their approach by including international climate agreements in other binding deals or bilateral agreements. The European Union and Japan’s 2017 trade deal, for example, referenced their Paris Agreement commitments.[14] The EU now demands similar language in all its new trade accords, and from 2024 it will be able to withdraw preferential trade access for developing countries if they do not meet environmental conventions, including the Paris Agreement.[15]

Climate action is another avenue of enforcing international climate agreements. In January 2020 the United Nations Environment Programme and the Sabin Center at Columbia University published a report,[16] which stated that there is a “growing tidal wave of climate cases” where climate litigation is being used to compel governments and corporate actors to pursue more ambitious climate change mitigation and adaptation goals, with climate lawsuits being brought in 38 countries in 2020, up from 24 in 2017.[17]

In Urgenda   Foundation   v   State   of   the   Netherlands   (Ministry   of   Infrastructure   and   the   Environment),[18] climate activists successfully sued the Dutch government for failing to protect people from global warming, and pointed to the country’s Paris Agreement obligations in their legal arguments.[19] The case was brought against the Dutch government by an organization called, Urgenda who argued that the failure of the Dutch government to take adequate action to prevent dangerous climate change and mitigate its harmful effects amounted to a violation of Article 2 (right to life) and Article 8 (right to family life) of the European Convention on Human Rights (ECHR). The Dutch District Court held in favour of Urgenda.

The decision was affirmed by Dutch Appeals Court[20] and the Dutch Supreme Court in a landmark 2019 judgment, where it stated that Dutch Government has a positive obligation under the ECHR to take reasonable and suitable measures for the prevention of climate change, and that the Netherlands is individually responsible for failing to do its part to counter the danger of climate change, which, as the Court affirmed, inhibits enjoyment of ECHR rights. The Supreme Court order the Dutch Government meet to comply with its ECHR obligation, specifically, a 25 percent reduction in greenhouse gas emissions compared to its 1990 level by the end of 2020.[21]

Also, in May 2021, the District Court of The Hague, Netherlands in Friends of the Earth (Netherlands) v Royal Dutch Shell[22] ordered Royal Dutch Shell to cut its greenhouse emissions by 2030, by 45% compared to 2019 levels in order to align with the Paris climate deal, which aims to limit global warming to 1.5 degrees Celsius.[23] The case was filed by a group of environmental organizations who asked the Court to rule that Shell should reduce its emissions, in accordance with the global temperature goal enshrined in the Paris Agreement and in accordance with the best available climate science. They relied on Dutch tort law to construe Shell’s duty of care in light of the rights to life and to respect for private and family life, as enshrined in Articles 2 and 8 respectively of the ECHR.[24] The Court in granting the Plaintiff’s claims relied on ‘the widespread international consensus that human rights offer protection against the impacts of dangerous climate change and that companies must respect human rights.’ It found that Shell has a responsibility to act in accordance with the temperature goal in the Paris Agreement.[25]

There have also been a number of decisions in courts and jurisdictions all around the world that have read the Paris Agreement to set legally enforceable targets.[26] These and many more climate actions may be veritable tools for the enforcement of international climate agreements.

  1. Conclusion:

A reasonable conclusion to be drawn from the issues discussed so far is that whilst treaties, protocols and climate summits are very important in bringing issues of climate change to the front burners of national and international discourse, the real battle lies in being able to take actions and implement measures that will bring the fruits of those discussions to reality. This requires, to a large extent, the co-operation of state actors and the concerted efforts of national institutions and climate activists through a willing implementation of climate commitments and judicial enforcement of treaty obligations.

_____________________________________________________________

For further information on this article and area of law, please contact

Emmanuel Abasiubong Bassey at S. P. A. Ajibade & Co., Lagos by

Telephone (+234.1.270.3009; +234.1.460.5091), Fax (+234 1 4605092)

Mobile (+234.703.805.9736, +234.815.088.2839)

Email: ebassey@spaajibade.com

www.spaajibade.com

_____________________________________________________________

[1] See,https://unfccc.int/process-and-meetings/the-paris-agreement/the-paris-agreement/key-aspects-of-the-paris-agreement#:~:text=The%20Paris%20Agreement’s%20central%20aim,further%20to%201.5%20degrees%20Celsius accessed on 4th July 2022.

[2]     See, https://www.grid.news/story/360/2022/01/27/rich-countries-promised-billions-of-dollars-in-climate-aid-the-bill-is-overdue-and-growing/ accessed on 4th July 2022.

[3]     Ibid. See also, https://www.nature.com/articles/d41586-021-02846-3 accessed on 4th July 2022.

[4]     See, https://unfccc.int/process-and-meetings/the-paris-agreement/the-glasgow-climate-pact/cop26-outcomes-finance-for-climate-adaptation accessed on 4th July 2022.

[5]     See, https://www.epw.senate.gov/public/index.cfm/2016/4/failures-of-kyoto-will-repeat-with-the-paris-climate-agreement accessed on 4th July 2022.

[6]     The Climate Change Act, 2008 as amended in 2019, commits the UK to ‘net zero’ by 2050.

[7]     In October 2021 New Zealand passed into law the Financial Sector (Climate-related Disclosures and Other Matters) Amendment Bill requiring banks, insurers, and investment managers to disclose how their business affects and is affected by climate change. The legislation is one of a number of actions the Government is taking to meet its international obligations and achieve net-zero emissions by 2050 as required by the Climate Change Response (Zero Carbon) Amendment Act 2019.

[8]      The European Climate Law sets a legally binding target of net zero greenhouse gas emissions by 2050.

[9]     H.R. 5376.

[10]    See https://www.investopedia.com/inflation-reduction-act-of-2022-6362263 accessed on 19th August 2022.

[11]   See https://www.bbc.com/news/science-environment-62464546 accessed on 19th August 2022.

[12]    See https://www.bbc.com/news/world-us-canada-62457386 accessed on 19th August 2022.

[13]     See https://www.iucn.org/news/commission-environmental-economic-and-social-policy/202203/a-review-nigerias-2021-climate-change-act-potential-increased-climate-litigation#:~:text=Overview%20of%20the%20Climate%20Change,zero%20target%20for%202050%2D2070 accessed on 19th August 2022.

[14]     See, https://trade.ec.europa.eu/doclib/docs/2017/july/tradoc_155721.pdf accessed on 4th July 2022.

[15]    See, https://www.reuters.com/business/cop/countries-wrangle-over-climate-pledges-how-enforceable-are-they-2021-11-12/ accessed on 4th July 2022.

[16]    Global Climate Litigation Report: 2020 Status Review, available at  https://www.unep.org/resources/report/global-climate-litigation-report-2020-status-review accessed on 8th August 2022.

[17]    See, https://workandclimatechangereport.org/2021/02/02/tidal-wave-of-climate-litigation-cases-and-trends-examined-in-new-report/ accessed on 4th July 2022.

[18]    Urgenda Foundation v State of the Netherlands (Ministry of Infrastructure and the Environment), District Court The Hague, Judgment of 24th June 2015 available at http://deeplink.recht spraak.nl/uitspraak?id=ecli:nl:rbdha:2015:7196 accessed on 8th August 2022.

[19]    See https://www.reuters.com/business/cop/countries-wrangle-over-climate-pledges-how- enforceable-are-they-2021-11-12/ accessed on 4th July 2022.

[20]    State of the Netherlands (Ministry of Infrastructure and the Environment) v Urgenda Foun­dation, Appeals Court The Hague, Judgment of 9 October 2018, available at  http://deeplink.recht spraak.nl/uitspraak?id=ecli:nl:ghdha:2018:2610 accessed on 8th August 2022.

[21]    State of the Netherlands  (Ministry  of  Infrastructure  and  the  Environment) v Urgenda  Foundation, Netherlands Supreme Court, Judgment of 20 December 2019 available at <http://deeplink.rechtspraak.nl/uitspraak?id=ecli:nl:hr:2019:2007 accessed on 8th August 2022.

[22]    Friends of the Earth Netherlands (Milieudefensie) v Royal Dutch Shell, District Court, the Hague, Judgment of 26 May 2021, English translation at http://deeplink.rechtspraak.nl/uitspraak?id=ECLI:NL:RBDHA:2021:5339 accessed on 8th August 2022.

[23]    See, https://www.bbc.com/news/world-europe-57257982. accessed on 4th August 2022.

[24]    It is noteworthy that the Court found that Shell was acting unlawfully, even though it found that Shell did not breach any specific provision of domestic or international law that Shell. According to the Court, Shell’s greenhouse gas emissions reduction obligation ‘ensues from the unwritten standard of care laid down in Book 6 Section 162 Dutch Civil Code, which means that acting in conflict with what is generally accepted according to unwritten law is unlawful’. Under Dutch private law, a company can be held liable not just when it acts contrary to a specific legal rule, but also when it acts contrary to a societal standard of  due  care  or  ‘proper  social  conduct’. This standard of due care can even be filled in by laws and regulations which, formally speaking, are not binding on the company, such as the Paris Agreement and the ECHR.

See, Spijkers, O. (2021), Friends of the Earth Netherlands (Milieudefensie) v Royal Dutch Shell, Chinese Journal of Environmental Law5(2), 237-256. doi: https://doi.org/10.1163/24686042-12340073, accessed on 8th August 2022.

[25]    See, https://sites.uef.fi/cceel/friends-of-the-earth-netherlands-v-royal-dutch-shell-human-rights-and-the-obligations-of-corporations-in-the-hague-district-court-decision/ accessed on 8th August 2022.

[26]   See, for example, German Klimaklage (Neubauer, et al. v. Germany), GFCC, order dated 24 March 2021, docket no. 1 BvR 2656/18 et al, filed February 2020; Decided April 29, 2021.

 

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