Perspectives Winter Newsletter

In this winter edition of our newsletter, we bring to you Perspectives’ latest highlights, including recent and upcoming events, new publications, an overview of our presence at COP28, and our experts' impact across the globe. Keep reading to gain?insights on the latest?developments in?carbon markets and climate solutions.

Webinar – Navigating the European Power-to-X policies and financing mechanisms?

Our Power-to-X (PtX)-experts invite you to join our complimentary webinar on the 19th and 21st of February, reviewing the latest hydrogen/PtX-policies and financing mechanisms within the dynamic European market. We will share insights building on the solid foundation of decade-long research and consultancy on the European policy landscape as well as numerous hydrogen and Power-to-X projects for the public and private sector.?

In our upcoming webinar, we will share our insights on the ever-evolving hydrogen regulations and policies like the EU-ETS, CBAM, RED II/III Directive and innovative financing mechanisms like the H2Global mechanism and the European Hydrogen Bank (EHB). We will also dive into their regulative and financial effects on your Power-to-X-related business ideas.?

Register now to secure your spot!??

Join us on February 19th?

Join us on February 21st??

Perspectives Climate Research is proud to have co-organised a stellar lineup of events to join the conversation at COP28 in Dubai. Our experts took part in numerous events as panellists, moderators, and observers, contributing with their knowledge and insights to future-shaping sessions.?Among the numerous events that took place between November 30 and December 12, we are pleased to highlight our official side events:

"Morocco's Experience in International Carbon Markets: Readiness and Operationalization of Article 6" – Watch the live stream recording HERE?

"Building on lessons learned: Setting a high bar for the Article 6.4 Supervisory Body's work" – Watch the live stream recording HERE?

"Debt-for-Climate swaps as an innovative and underused instrument of climate finance" – Watch the live stream recording HERE?

Keep reading or visit our website for more details on our presence at COP28.

Perspectives’ 20th anniversary celebrated with carbon market and climate policy stalwarts at COP28?

On Dec. 8, 20 long-standing international carbon market and climate policy actors met at the International Climate Dialogue Pavilion at COP28 to celebrate Perspectives’ company anniversary and reflect on key lessons from the last decades of climate policy. Prof. Frank Jotzo from Australian National University discussed how climate policy issues led to the fall of seven Australian prime ministers. Fenella Aouane from GGGI presented how to harness local experience for carbon market activity implementation in developing countries. Sandra Greiner from Climate Focus shared lessons from carbon market capacity building in Africa. Gareth Phillips who worked as CDM project developer and now oversees the Adaptation Benefits Mechanism at the African Development Bank described how the CDM experience informs the design of a novel incentive mechanism for private funding in adaptation. Axel Michaelowa rounded off the event with his key takeaways from 30 years of carbon market and climate policy work. While the expensive drinks ordered from the COP Catering never arrived, the mood was very relaxed and fitting the occasion!?

Building Nordic capacity on high-integrity voluntary carbon markets?

In 2023, the Nordic Dialogue Team has come back with a new project on building capacity for the voluntary carbon market, funded by the Nordic Council of Ministers. Under this project, Perspectives and its partners organise a series of capacity building events to help Nordic stakeholders to understand and implement best practices for voluntary carbon markets. The project builds on the results and recommendations of the Nordic Dialogue on Voluntary Compensation (2021-2022).

The project was kicked off in November 2023 with a webinar on a status update on best practices for the voluntary carbon market, including insights on key initiatives such as ICVCM, VCMI and SBTi. At COP28 in Dubai, Perspectives presented the project and hosted a panel discussion on the rapidly evolving voluntary carbon market and its alignment with the Paris Agreement. Recordings of these events are available on the Nordic Dialogue website. To stay up to date on further in-country workshops and webinars, please visit the website or sign up for our newsletter.??

Decoding “Effectiveness” in Climate Change Adaptation?

Perspectives’ adaptation team hosted a side event at COP28 titled "Decoding 'Effectiveness' in Climate Change Adaptation - Insights from Research and Practice." This event endeavoured to unravel the complexities surrounding the concept of 'effective' climate change adaptation.???

One of COP28's hot topics was the Global Goal on Adaptation, where a framework was adopted to strengthen adaptation efforts and track countries' progress. To achieve this, we need to analyse and learn from past adaptation actions to determine whether they have succeeded in reducing climate risks and vulnerabilities and/or strengthening resilience. To date, however, defining and operationalising 'effective adaptation' remains a conceptual and methodological challenge, given its context-specific nature. The event focused on dissecting the multifaceted concept of effectiveness in the context of climate change adaptation, with a focus on the different interpretations and priorities of stakeholders, including climate finance donors (AF-TERG), evaluators (German Institute for Development Evaluation), researchers (CIAT) and practitioners (IIED).?

The event discussed different approaches to ensure the effectiveness of adaptation measures and recognised similar challenges facing stakeholders such as defining clear adaptation objectives and choice of metrics. The discussion highlighted the importance of continuous dialogue and work to develop a common understanding of how to integrate considerations of effectiveness at all stages of planning, financing, implementing, monitoring, evaluating, and learning.??

Ethiopia Cooling Initiative: Challenges and prospects?

At COP28, Perspectives Climate Group organised Ethiopia's Cooling Initiative, which shed light on crucial developments in promoting sustainable cooling in the country.?The event was presided over by the governments of Ethiopia and Pakistan, international agencies such as UNEP, and funding agencies such as ClimateWorks Foundation.

Stephan Hoch and Wondwossen Sintaneyehu moderated the event that showcased "Establishing Access to Sustainable Cold Chains in Ethiopia" while the Ethiopian government, the Ministry of Planning and Development (MoPD), and the Environmental Protection Authority (EPA)-lead consortium spearheads the project.?

The speakers discussed the urgent need for robust policy instruments and enhanced financing to promote green cooling in Ethiopia. Key topics included the need for policy harmonisation, and the urgency of cutting along with enhancing energy efficiency, phasing down HFCs, and collaboration with the private sector. Additionally, it was emphasised that the urgent need to link the Kigali Amendment with the Paris Agreement and customised financing for the cooling sector marked a significant stride in Ethiopia’s pursuit of sustainable cooling.?

Climate Finance before and at COP28??

In the run to COP28, Igor Shishlov spoke at a LinkedIn Live of HEC Paris on international climate negotiations and the role of finance, while Max Schmidt was invited to present to students of the University of Edinburgh’s Business School on the importance of Loss & Damage (L&D) finance. In the first week of COP28, our experts Laila Darouich and Sherri Ombuya moderated two side events at the Nordic Pavilion, on “Debt-for-climate swaps as a Climate Finance Instrument” and on the “Paris Alignment of Export Credit Agencies: The next frontier for realising the Nordic Vision 2030.” Laila and Sherri were joined by experts from the research institutes IIED and SEI, a former minister of the Seychelles, a representative of the United Nations Capital Development Fund as well as the Swedish Export Credit Agency EKN and the NGO Swedwatch. In the second week, and in the run-up to Perspectives’ new report on “Opportunities and challenges for Debt-for-Climate swaps,” Laila also moderated a panel on “DFC swaps as an innovative and underused instrument of climate finance” as an Official COP28 Side Event with the Seychelles.?

Post-COP28 webinars?

Axel Michaelowa’s post-COP webinar draws huge crowds?

Over 600 participants from around the world listened to Axel Michaelowa’s summary of COP28 outcomes during a webinar on Dec. 18, 2023. Given Axel’s experience in the UNFCCC process with the attendance of 26 COPs, his summaries of the momentous event’s outcomes are renowned around the world, particularly as they come less than a week after the end of the COP. Axel benefited strongly from the work of a 10-person delegation sent by Perspectives to Dubai. Axel saw the COP as 60% successful, citing the Loss & Damage Fund decision on its first day and the Global Stocktake decision which left everyone equally unhappy and was therefore a beautiful feat of diplomacy. He deplored the lack of COP Presidency interest for the topic of international carbon markets, leading to the failure of that negotiation stream.?

Find below access links and information on both of Axel Michaelowa’s post COP28 webinars:??

“Understanding COP28: Key Outcomes and Perspectives” Recap the FREE WEBINAR? online?and SUMMARY to learn about key outcomes and results of COP28, basic implications for global climate policy and an overview of strategic insights for various stakeholders.?

“Deep Dive into COP28: Comprehensive Analysis of Outcomes and their Possible Consequences."? Recap the advanced deep dive?HERE?to access a most detailed analysis of COP28's key decisions and agreements, insights into strategic implications for policy and business,?and follow an?interactive Q&A with Axel.?

New COP28 Special Edition of the Carbon Credit Quarterly Highlights report available – access via paid subscription???

Understanding carbon credit markets and their ever-evolving role in business and policy may seem like a daunting and complicated endeavour, but that is why our experts are helping you to stay informed!??

We are pleased to announce the release of the second issue of our Carbon Credits Quarterly Highlights (CCQH) as a COP28 special. In each issue, we cover international negotiations on Article 6 of the Paris Agreement, key initiatives, policies, and partnerships around the world. We also take a deeper dive into two topics chosen by our Editor-in-Chief, Hanna-Mari Ahonen.??

We are happy to share a sneak peek of the new issue in an introductory call and explain how you can gain access to this new product by Perspectives Climate Group. For more information, please see our website, or contact Lena Gründel, [email protected]?

Export credit agencies (ECAs) and the role of US export finance?

In October, Perspectives published its assessment of the US EXIM – the official US export credit agency (ECA) – against the country’s climate and development objectives, for which we interviewed representatives from US EXIM, the US Treasury, and the US Congress, as well as civil society organisations. The study was launched at a webinar hosted by Oxfam America. The research report and webinar were accompanied by a policy brief on “How to Make US EXIM Work for Climate and Development.” Shortly after, Perspectives’ Head of Climate Finance, Igor Shishlov, was interviewed twice by Global Trade Review (GTR), specifically on US EXIM and whether ECAs are falling behind on climate finance. For the second time, Igor Shishlov was also invited to the OECD’s annual Export Credits Forum, where he discussed the reforms needed to steer export finance away from fossil fuels.?

Innovative instruments for Loss and Damage finance?

In October, Perspectives published the research report “Assessment of the Most Promising Instruments,” outlining innovative financial approaches to address losses and damages (L&D) caused by the climate crisis. Overall, we found that only a combination of financial instruments will be able to fill the L&D finance gap and respond to the wide range of actions that encompass addressing L&D.??

Perspectives formally submitted its report to the UNFCCC and participated as an observer to the 4th Meeting of the Transitional Committee, informing discussions on the operationalisation of the new L&D funding arrangements and the L&D fund.??

Building on the report, Perspectives published a policy brief titled “Towards Closing a Deal on Finance for Loss and Damage” in November. Authored by our Climate Finance Team, Sherri H. Ombuya and Max Schmidt, the brief delves into the pressing need for innovative solutions amid record-breaking heatwaves and catastrophic weather events in 2023. It emphasizes the urgency of supporting affected communities, particularly in developing nations disproportionately impacted by climate change.??

In the same month, together with Igor Shishlov and Axel Michaelowa, the Climate Finance Team authored “International Climate Finance from a Global Perspective.” This working paper is our latest publication in the Austrian Foundation for Development Research (?FSE) on international climate finance. It explores intricacies and consequential disputes over reported climate finance figures, and sheds light on developed countries’ struggles to meet the USD 100 billion annual target reaffirmed by the Paris Agreement.??

Specifically for non-economic L&D, Sherri Ombuya and Max Schmidt also contributed to a policy brief on “L&D Pilot Funding Arrangements” by the European Capacity Building Initiative (ECBI).?

A conceptual framework for Article 6 readiness Summary Brief?

Together with the NDC Partnership, our experts have developed a tool to guide Article 6 decision-makers through the building blocks of Article 6 readiness.?

This tool is based on a conceptual framework for Article 6 readiness which our experts and NDC Partnership have published in a summary brief in December 2023. The tool itself will be made available in spring 2024. READ MORE?

The Landscape of Article 6 Implementation - State of Play and Key Developments report launched at COP 28

As part of the Climate Finance Innovators project coordinated by Perspectives Climate Group, in close collaboration with Climate Focus, and supported by Germany’s International Climate Initiative, launched The Landscape of Article 6 Implementation report which provides the most complete and up-to-date overview of the progress made on global Article 6 implementation on a practical level and is the fourth edition of a series of similar studies. The study also reviews the status of Article 6 rules from an implementation perspective, followed by a deep dive on host country frameworks that looks at the level of preparedness of 51 countries to participate in Article 6 cooperation. Finally, the report summarises key facts and figures and offers fact sheets on all relevant Article 6 implementation initiatives.??

Key takeaways from the report include:??

• The implementation of Article 6 carbon market activities is progressing but has only been slowly moving beyond piloting.?
• The unfinished business of crafting international and domestic carbon market rules, as well as operationalising the Article 6.4 mechanism is a key limiting factor.?
• Countries are taking different approaches to managing the interface between Article 6 and the VCM, but it is encouraging that many developing countries have begun to work on establishing national frameworks for Article 6 participation requirements.??
• Whether carbon market implementation at scale materialises, depends not only on ITMO supply but also on more ambitious demand signals from buyers.?

READ MORE??

The Future of PoAs | Forging ahead: A journey in perspective?

In October, our colleagues Peris Waweru and Stephan Hoch authored the article “The Future of PoAs,” featured in the the "Carbon Mechanisms Review 03-2023: Driving Green Growth."??

The establishment of programmatic approaches represented one of the most significant reform accomplishments of the Kyoto Protocol market mechanisms. The Programme of Activities (PoA) concept, which has been applied in the Clean Development Mechanism (CDM), Joint Implementation (JI) as well as voluntary carbon standards, has led to well-defined rules for implementing programmatic mitigation activities.??

This article highlights the achievements of the Programme of Activities (PoA) concept in enhancing the accessibility of CDM activities, particularly for Africa and LDCs. This concept encompassed the uptake of initiatives, from decentralised projects like efficient improved cook stoves and off grid electrification to large scale renewable energy. The article also explores the opportunities for programmatic approaches under Article 6 of the Paris agreement.?READ MORE ?

Watch the video on YouTube HERE?

Building capacity on Article 6 and voluntary carbon markets in Paraguay?

In early October, Axel Michaelowa and Ximena Samaniego provided input to a workshop of 130 stakeholders in Asuncion, Paraguay, regarding the design of carbon market participation of Paraguayan entities. In the same week, a carbon market bill had passed in the Paraguayan parliament conferring far-reaching rights to carbon credits and private sector players. Perspectives had provided comments to earlier versions of the bill and recommended taking Article 6 into account, in order not to be dependent on the fortunes of the voluntary carbon market. The underlying project is ongoing and is entering its final phase in early 2024.?

Axel Michaelowa speaking on carbon market opportunities for MENA region at MENA Climate Week?

In mid-October, our Senior Founding Partner Axel Michaelowa spoke at MENA Climate Week 2023 in Riyadh, Saudi Arabia, on “Accelerating Article 6 Readiness in Middle East and North African Countries.”?

Implementation of international carbon markets under the Paris Agreement could be relevant for many Middle Eastern and North African (MENA) countries, potentially halving the cost of implementing the NDCs. In a workshop hosted by the NDC Partnership, Axel gave a keynote speech highlighting the states and trends of Article 6 implementation in the Middle East and North Africa regions, and he answered audience questions about the priorities of MENA countries for Article 6 readiness.?

Further in the context of the MENA Climate Week 2023, Axel Michaelowa moderated an event discussing the potential of carbon markets for emission reductions and removals in advancing the net zero transition. The session also discussed carbon removal technologies including carbon capture and utilisation technologies.?

Specifically, Axel highlighted the role of linking voluntary and Article 6 markets, the key role of generating domestic demand for the former, and the clever use of niches that command high prices.?

Providing input to prestigious Indian Kautilya Conclave on the state of international carbon markets?

From 20-22 October 2023, Axel Michaelowa participated in the Kautilya Conclave in New Delhi, India, a conference bringing together key economists working on Indian policy issues and high-level officials from key ministries. Axel presented on a panel jointly with Prof. Nick Stern and gave an overview of the opportunities of international carbon markets for India. Axel also provided recommendations for India not to accumulate further delays in institutionalising Article 6 given its huge potential to mobilise revenues for the implementation of “high-hanging fruit” mitigation measures.??

Advancing the Vietnamese Just Energy Transition Partnership?

Since November 2023, Axel Michaelowa has worked with various Vietnamese ministries to overcome challenges in the implementation of the Just Energy Transition Partnership (JETP) which has pledged 15.5 billion USD for reducing coal power plant use and increasing renewable electricity generation. This assignment on behalf of the EU Delegation in Vietnam aims at advancing the implementation of the Resource Mobilization Plan. Axel Michaelowa has been asked by the Ministry of Natural Resources and the Environment to study how revenues from international carbon markets can catalyse coal power plant closures, grid strengthening and renewable electricity expansion.?

Hydrogen for Net Zero Initiative presented at IEA workshop?

On November 10, 2023, Axel Michaelowa presented Perspectives’ Hydrogen for Net Zero Initiative on development of a suite of baseline and monitoring methodologies for the low-carbon hydrogen value chain at the 23rd Annual IEA-IETA-EPRI Workshop on Greenhouse Gas Emissions Trading in Paris. Axel has repeatedly provided inputs to this conference which is famous for addressing innovative topics on international and national carbon markets and which brings together government regulators, industry, and selected experts.?

Problems in the voluntary carbon markets highlighted in Indian webinar?

On Nov 24, 2023, Axel Michaelowa spoke to over 200 participants on the invitation of the Indian NGO Centre for Science and Environment in the webinar “Voluntary Carbon Markets: A Need for Course Correction.” Axel discussed the current crisis on the voluntary carbon markets and made recommendations for Indian stakeholders to move towards the high-quality end of these markets as low-quality projects would in the future no longer generate relevant revenues.

Join our team at Perspectives Climate Group - exciting opportunities await!

We are thrilled to announce that Perspectives Climate Group is expanding its team and looking for exceptional individuals to join us in making a positive impact on the climate sector. We currently have three different positions available, and invite you to be part of our passionate and dedicated team.

If you or someone you know is eager to make a difference in the climate sector, we invite you to explore the job postings below and share them within your communities:

• Technical Analyst or Junior Consultant (m/f/d) – Green hydrogen / PtX
• Financial Project Coordinator | ?ffentliche F?rderprojekte (m/w/d)
• Senior Consultant – Carbon Market Mechanisms (m/f/d)

Join us at PCG and be part of an inspiring team committed to creating a sustainable future.

Thank you for your continuous support and engagement. Together, we can make a meaningful impact on our planet.

Warmest regards,

The Perspectives Climate Group Team