innovative schemes for financing adaptation and enhancing technology transfer

Valentino Piana

Ankara, 19th November 2009

Innovative Schemes for Innovative Schemes for

Financing Adaptation and Financing Adaptation and

Enhancing Technology Transfer Enhancing Technology Transfer

www.economicswebinstitute.orgCutting-edge research & implementation consulting

Contents

1. A qualitative evaluation of the costs of climate change and adaptation

2. The adaptation cost curve (by strategy type) - qualitative estimates

3. Conventional and innovative sources for adaptation funds

4. Enhancing technology transfer: the debate

5. Conclusions


Systemic relevanceAwareness Dominance

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07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 21 22 23 24 25 26 27 28 29 30 31 32 33 34

Climate change damage

Adaptation expenditures

1. A qualitative evaluation of the costs of climate change and adaptation


2. The adaptation cost curve (by strategy type) - qualitative estimates

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-10

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110

Cost

Savingstrategies

Frameworkstrategies(process)

System-wideintervention

Protection of keyassets

Frameworkstrategies(measures)


International funds (from COP15 new facilities, from WB,…)

Local mobilization

1

2

3

4 Insurance schemes4

4 “Polluters pay” + “Profit tax from CC gains”5

Domestic tax ---> PRODINT



International funds (from COP15 new facilities, from WB,…)1

“Adaptation Framework / ProgrammeInternational Insurance Facility / mechanismCompensation and rehabilitation component

Adaptation Commitee / Subsidiary Body

National Adaptation Plans

Regional centres for adaptation”

(AWG-LCA Non-paper n. 41, 5/11/2009)



Who pays

How and who managethe fund

What to fund

How much

Large-enough international funds need to be collected from many countries, from both public and private sources, credibly managed

and spent on uncontroversial actions

International funds (from COP15 new facilities, from WB,…)1



Distribution of local adaptation plansLegenda: EE1 = lack of adaptation plan in areas at risk: the"blue"

agents pay; EE2 = good and cost-effective adaptation plan:

the "red" agents receiveBetween EE1 and EE2: Neutral area of unsufficient local plans to be

financed after improvements

2 Domestic tax ---> Local mobilization + PRODINT3



Distribution of consensus for PRODINTLegenda: EE1 = the"blue" agents are against (but guilty);

EE2 = the "red" agents receive (and are in favour)Between EE1 and EE2 = they will receive next time (so they

are in favour)

National and international

fundscan improve

these balances,

reaching an even wider majority of consensus

2 Domestic tax ---> Local mobilization + PRODINT3



Public-driven, private-delivered instrument to quantify risk in specific areas

and spread it in uncorrelated conditions

It is possible a mandate to cover areas at risk

It should be thoroughly explored

However, it remains possible that private assurances will ask too much and

re-assurance business will be afraid of systemic risk

4 Insurance schemes4



Damage-based request for compensation

Strong linkage to mitigation

If any business or industry gains from the change in climate (e.g. shipments through the Arctic Sea),

their profits should be taxed away to fund adaptation

International agreements needed

4 “Polluters pay” + “Profit tax from CC gains”5



International institutions from COP15

“Executive Body on TechnologyTechnology Incentive for Development

and TransferTechnology Capacity Building Program

Technology Mechanism/National policies

Regional Hubs for Technology Tranfer, Sectoral Innovation Centers,

Executive Coordinating Council

Climate Technology CentreClimate Technology Network/

Technology Action Framework/A financing and technology mechanism

International Technology Action PlanNational Technology Action Plan

Global Technology Pool for Climate ChangeGlobal Technology IPR Pool for Climate Change

Technology Development and Transfer Facility/service

Climate Technology Hugs and Corps

Technology Innovation Centres”

(AWG-LCA Non-paper n.47, 6/11/2009)

4. Enhancing technology transfer: the debate


Conclusions

Financing adaptation to climate change will exacerbate fiscal problems and international difficulties in solidarity.

But properly managed and channeled, the overall architecture of COP15 and beyond can be a crucial leverage for sustainable

development at large.

Technology is not the only solution: behavioural, organisational and infrastructural components are essential.

However, trade-offs between costs and effectiveness can be improved by proper and appropriate technology change.

Fast developing countries with large absorption capacity should be at the forefront of international dialogue.


For further information and support feel free to contact us!

Thank you for your kind attention.

Valentino Piana <[email protected]>

Mobile phone: +39 349 36 10 476

innovative schemes for financing adaptation and enhancing technology transfer

Economy & Finance