Common Dreams: Wall Street's Climate Finance Bonanza

It is incredibly important to continue to spread the word about climate change and global warming related issues, which are especially under-reported or not reported at all in the corporate media. Another world is possible. Molly

***********************

 Published on Wednesday, April 10, 2013 by Common Dreams

Wall Street's Climate Finance Bonanza

by Janet Redman and Antonio Tricarico

Government officials from an elite group of developed countries meeting in Washington, D.C.at the invitation of U.S. climate envoy Todd Stern appear to be on the brink of instigating yet another corporate handout and big bank giveaway—this time in the name of fighting climate change. 

If it follows a recently leaked agenda (pdf), the meeting will focus on using capital markets to raise money for climate finance. The goal is to fill the void left by the United States and other developed nations that have failed to meet their legal obligations to deliver funding to poorer countries for climate programs.

In this corporate-oriented approach, countries would provide generous loan guarantees and export subsidies that sweeten investments for private firms and give them the chance to net big profits while leaving governments (and the taxpayers they represent) to cover the losses if investors’ bets don’t pay off. Wealthy countries would then be able to claim that they had moved billions of dollars of new climate investments. 

Unfortunately, the projects best placed to benefit from large-scale private investment and market mechanisms—like mega-infrastructure projects and fossil fuel-powered ventures that hide behind a “low-carbon” label—are likely to be those that have fewest sustainable development benefits. In many cases, the funding will channel windfall profits to corporations that would have invested profitably even without these new channels of support.  

The sad fact is that this has happened before. Nations spent five years negotiating the Kyoto Protocol—the only multilateral treaty to regulate emissions of greenhouse gasses and spell out binding targets for reducing climate pollution. But before the treaty was finalized in 1997, the United States led a push to replace the enforcement mechanism—a fine for missing reduction targets paid into a clean development fund—with a market mechanism meant to lower the cost of compliance for polluting companies. The accompanying clean development mechanism (CDM) was born so that companies in the industrialized world could purchase ultra-cheap carbon pollution credits from developing nations to offset their continued pollution at home.

A decade and half later, carbon markets have collapsed, developing countries are awash with carbon credits for which there is no demand, and the planet keeps getting warmer.

In the end the United States pulled out of the Kyoto treaty. But by shifting a global regulatory regime into a market-based regime centered on enticing private-sector investment with promises of profitability, Washington left its mark. 

A decade and half later, carbon markets have collapsed, developing countries are awash with carbon credits for which there is no demand, and the planet keeps getting warmer.

Meanwhile, the clean development mechanism has led to private sector investment in spurious projects like mega-hydropower dams and coal-fired power plants that have delivered little in the way of sustainable development outcomes—and in some cases have further harmed the environment and human health.

For the complete article, please go here: http://www.commondreams.org/view/2013/04/10-6

********************* 

We wield an enormous influence over the world through how we choose to vote and what we choose to buy. Again, it's the power of numbers. If voters hold their leaders responsible for doing something about global warming, it will get done. If most people refuse to buy products from companies that, for example, wrap products in more plastic than necessary, pretty soon the plastic wrapping will stop. - ANTHONY D. BARNOSKY, Heatstroke: Nature in an Age of Global Warming 

The goal, the urgent necessity, is to reduce global warming pollution in the atmosphere enough to pull us back from the precipice before the changes in earth's ecosystems and weather patterns become so rapid and so vast that we will no longer be able to reverse the catastrophe. - FRED KRUPP, Earth: The Sequel

It is true that there are still some who deny that global warming is taking place, or that it constitutes a serious problem. Others, while recognizing that global warming is occurring, do not accept that it results from human activities and hence effectively deny that action can be taken to combat it. The great majority of atmospheric scientists, however, now accept that man-made emissions--chiefly, but not only, of carbon dioxide--are aggravating the so-called 'greenhouse effect', thereby causing the world to warm up to what amounts to a dangerous extent. - BARRY HOLDEN, introduction, Democracy and Global Warming

The danger is that global warming may become self-sustaining, if it has not done so already. The melting of the Arctic and Antarctic ice caps reduces the fraction of solar energy reflected back into space, and so increases the temperature further. Climate change may kill off the Amazon and other rain forests, and so eliminate once one of the main ways in which carbon dioxide is removed from the atmosphere. The rise in sea temperature may trigger the release of large quantities of carbon dioxide, trapped as hydrides on the ocean floor. Both these phenomena would increase the greenhouse effect, and so global warming further. We have to reverse global warming urgently, if we still can.- STEPHEN HAWKING, ABC News interview, Aug. 16, 2006