The European Commission has put forward a communication on 28 January, which outlines proposals for a global climate deal to be reached by the end of the year in Copenhagen.  One of the core themes of the paper focuses on how to generate a flow of funds from richer to poorer countries, whilst the theme of ‘common but differentiated responsibilities’ in reducing or limiting greenhouse gas emissions is another key focus.

Underlying these concerns is the belief that the importance of the most rapidly developing countries should share some of the burden for reducing greenhouse gas (GHG) emissions, saying that such a commitment is crucial for preventing dangerous global warming. Emissions in countries such as India and China are rising rapidly, meaning that the efforts of developed countries to reduce their carbon footprint will not be sufficient on their own. The Commission therefore proposes to calls on such developing countries to slow their emission growth to between 15 and 30% by 2020, whilst urging developed countries to cut their emissions to 30% below 1990 levels in the same time frame.

EU Environment Commissioner Stavros Dimas has made clear that the funding for helping the world’s poorer economies will largely come from the private sector and global carbon markets. These countries must implement far-reaching low-carbon strategies through strong regulation and the use of domestic resources, with the aim of shifting private sector investment towards cleaner technologies.

A large portion of funding for investment into new technologies and helping developing nations can also come from money generated on a global carbon market. Specific prices and numbers are not mentioned in the communication with talk of an ‘annual financial commitment’ based on an ‘agreed formula’ mentioned instead. If the €1-3 per tonne of carbon price range were imposed however, as mentioned in an earlier draft, up to €160 billion could be raised for the poorest countries, with the Commission estimating that €175 billion is needed annually by 2020 to mitigate climate change.