Photographer: Carla Gottgens/Bloomberg

Europe: The Secret Weapon for Global Climate Change Deal

As the Paris climate summit approaches, the EU's leading think-tank is urging ministers to take leadership on funding

There are almost 200 nations meeting in Paris in December at the United Nations global climate summit, and the prospects for a deal are uncertain -- French President Francois Hollande said Thursday it may already be too late to reach an agreement on emissions targets. One big developed-world bloc -- the European Union -- could help break the deadlock. That's if it can pull itself together in time.

Europe is in the lead in terms of its financial efforts to mitigate rising global temperatures and adapt to the consequences. Official development aid for climate-change purposes reached $24.9 billion in 2013, far ahead of the U.S., China, and the rest of the world combined. Even so, the EU, representing about 500 million citizens, could do a lot more if countries pooled funding instead of the 28 member states pursuing their own policies. That's the analysis of Guntram Wolff and Georg Zachmann, researchers at the Brussels-based Bruegel Institute who will present a report on climate finance to a meeting of the EU's finance ministers in Luxembourg Friday.

Take the example of pledges to the United Nations' Green Climate Fund. This is the main global vehicle for channeling funds from developed countries to poorer nations in order to limit greenhouse-gas emissions and invest to deal with the damage that's already been done and is yet to come. EU members' participation varies greatly -- on a per-capita basis, 10 countries contribute nothing while Sweden leads the remaining 18 member states at $60 per citizen. While that obviously reflects the wealth differential across the region, the bloc could still mobilize its moral muscle to a much greater extent by encouraging all members to dig deeper, according to Wolff and Zachmann.

"A global deal will require agreement from developing countries, some of which are most interested in predictable climate finance flows," they write. "So a consistent EU position on climate finance would be instrumental for reaching a deal in Paris. Backing up past pledges partially with tax payers' resources and also with a proper strategy for private funding would increase the EU’s credibility; and joint EU funding would provide predictable future flows."

Raising contributions from laggards is just one step toward greater unity. The paper also urges a revamp of the region's emissions-trading system as well as a carbon tax on transport and heating fuels. The make-or-break summit is intended to build on the 1997 Kyoto Protocol, which set pollution reductions only for industrialized nations. There were no limits for emerging economies such as China and India, even though they now represent a serious chunk of global emissions.

With the summit date approaching, Bruegel's most powerful message is the simplest: without a strong global deal on climate change, "much of the EU climate policy will be futile.''

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