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Carbon Emissions: Developing Countries

Volume 497: debated on Tuesday 13 October 2009

To ask the Secretary of State for Energy and Climate Change with reference to the Prime Minister’s announcement of 26 June 2009 of a $100 billion per year fund to help developing countries reduce their emissions, what proportion of this fund the Government expects to contribute; and from which budget this funding will be made. (289687)

The UK wants all countries except the least developed to contribute to climate financing. The UK is arguing for an objective, transparent way of working out which countries should contribute using criteria such as ability to pay (GDP) and responsibility (emissions).

We expect a significant portion of the $100 billion figure to be generated by a reformed and expanded global carbon market. Revenues generated by the carbon market are heavily dependent on the mitigation ambition of a global deal, so we are simultaneously pushing for a high ambition deal at the Copenhagen summit in December.

The UK has proposed that some climate finance can come from official development assistance where it clearly meets both poverty reduction and adaptation or mitigation objectives. However, in the UK we will limit such expenditure to up to 10 per cent. of our official development assistance. We are working towards this limit being agreed internationally.

The rest would come from a combination of new and additional sources of finance. The UK would be willing to support the approach proposed by Norway, which is an ‘automatic’ mechanism for generating predictable and credible flows of international public finance by auctioning a small proportion of international emissions allowances.

A decision has not been made about which budget this funding will be made from. The UK has pledged to pay its fair share of climate finance, but the exact proportion the UK Government expect to contribute are contingent on the deal at Copenhagen.

To ask the Secretary of State for Energy and Climate Change with reference to the Prime Minister's announcement of 26 June 2009 of a $100 billion per year fund to help developing countries reduce their emissions, whether he expects to achieve a global agreement on this proposal (a) before the Copenhagen summit and (b) at the Copenhagen summit. (289688)

The aim of the Prime Minister's announcement was to move the debate from hypothetical figures to negotiation on actual mitigation actions and contributions. The UK wants all countries except the least developed to contribute to climate financing. The $100 billion figure includes carbon market revenues, up to 10 per cent. of official development assistance and a combination of new and additional sources of finance; the UK is willing to support an ‘automatic’ mechanism auctioning a small proportion of international emissions allowances, as proposed by Norway.

The UK has been working towards a global agreement on the principles set out in the Prime Minister's announcement, using all available international negotiations and near-negotiations fora. The initiative has enabled the UK to show leadership and provided an opportunity to push for strong progress on climate finance. The international response has been positive, both from developing countries such as The Maldives and Rwanda, as well developed countries such as Australia. Recently, the Prime Minister was invited by President Obama to give a presentation on the UK initiative at the Major Economies Forum. We will continue to work closely with EU and international colleagues in the coming months in order to reach a global agreement on finance at the Copenhagen summit.