1. Innovative Schemes for Financing Adaptation and Enhancing Technology Transfer Valentino Piana Ankara, 19th November 2009

2. Contents 1. A qualitative evaluation of the costs of climate change and adaptation 2. The adaptation cost curve (by strategy type) - qualitative estimates 3. Conventional and innovative sources for adaptation funds 4. Enhancing technology transfer: the debate 5. Conclusions www.economicswebinstitute.org Cutting-edge research & implementation consulting

3. 1. A qualitative evaluation of the costs of climate change and adaptation Adaptation expenditures Awareness Dominance Systemic relevance 280 240 180 Climate change damage 160 120 80 40 0 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 21 22 23 24 25 26 27 28 29 30 31 32 33 34 www.economicswebinstitute.org Cutting-edge research & implementation consulting

4. 2. The adaptation cost curve (by strategy type) - qualitative estimates www.economicswebinstitute.org Cutting-edge research & implementation consulting

5. 3. Conventional and innovative sources for adaptation funds 4 5 1 International funds (from COP15 new facilities, from WB,…) 2 Domestic tax ---> PRODINT 3 Local mobilization 4 Insurance schemes 4 “Polluters pay” + “Profit tax from CC gains” www.economicswebinstitute.org Cutting-edge research & implementation consulting

6. 3. Conventional and innovative sources for adaptation funds 1 International funds (from COP15 new facilities, from WB,…) “Adaptation Framework / Programme International Insurance Facility / mechanism Compensation and rehabilitation component Adaptation Commitee / Subsidiary Body National Adaptation Plans Regional centres for adaptation” (AWG-LCA Non-paper n. 41, 5/11/2009) www.economicswebinstitute.org Cutting-edge research & implementation consulting

7. 3. Conventional and innovative sources for adaptation funds 1 International funds (from COP15 new facilities, from WB,…) How much Who pays What to fund How and who manage the fund Large-enough international funds need to be collected from many countries, from both public and private sources, credibly managed and spent on uncontroversial actions www.economicswebinstitute.org Cutting-edge research & implementation consulting

8. 3. Conventional and innovative sources for adaptation funds 2 3 Domestic tax ---> Local mobilization + PRODINT Distribution of local adaptation plans Legenda: EE1 = lack of adaptation plan in areas at risk: the"blue" agents pay; EE2 = good and cost-effective adaptation plan: the "red" agents receive Between EE1 and EE2: Neutral area of unsufficient local plans to be financed after improvements www.economicswebinstitute.org Cutting-edge research & implementation consulting

9. 3. Conventional and innovative sources for adaptation funds 2 3 Domestic tax ---> Local mobilization + PRODINT National and international funds can improve these balances, reaching an even wider majority of consensus Distribution of consensus for PRODINT Legenda: EE1 = the"blue" agents are against (but guilty); EE2 = the "red" agents receive (and are in favour) Between EE1 and EE2 = they will receive next time (so they are in favour) www.economicswebinstitute.org Cutting-edge research & implementation consulting

10. 3. Conventional and innovative sources for adaptation funds 4 4 Insurance schemes Public-driven, private-delivered instrument to quantify risk in specific areas and spread it in uncorrelated conditions It is possible a mandate to cover areas at risk It should be thoroughly explored However, it remains possible that private assurances will ask too much and re-assurance business will be afraid of systemic risk www.economicswebinstitute.org Cutting-edge research & implementation consulting

11. 3. Conventional and innovative sources for adaptation funds 5 4 “Polluters pay” + “Profit tax from CC gains” Damage-based request for compensation Strong linkage to mitigation If any business or industry gains from the change in climate (e.g. shipments through the Arctic Sea), their profits should be taxed away to fund adaptation International agreements needed www.economicswebinstitute.org Cutting-edge research & implementation consulting

12. 4. Enhancing technology transfer: the debate International institutions from COP15 “Executive Body on Technology Technology Incentive for Development and Transfer Technology Capacity Building Program Technology Mechanism/ National policies Regional Hubs for Technology Tranfer, Sectoral Innovation Centers, Executive Coordinating Council Climate Technology Centre Climate Technology Network/ Technology Action Framework/ A financing and technology mechanism International Technology Action Plan National Technology Action Plan Global Technology Pool for Climate Change Global Technology IPR Pool for Climate Change Technology Development and Transfer Facility/service Climate Technology Hugs and Corps Technology Innovation Centres” (AWG-LCA Non-paper n.47, 6/11/2009) www.economicswebinstitute.org Cutting-edge research & implementation consulting

13. Conclusions Financing adaptation to climate change will exacerbate fiscal problems and international difficulties in solidarity.But properly managed and channeled, the overall architecture of COP15 and beyond can be a crucial leverage for sustainable development at large.Technology is not the only solution: behavioural, organisational and infrastructural components are essential.However, trade-offs between costs and effectiveness can be improved by proper and appropriate technology change.Fast developing countries with large absorption capacity should be at the forefront of international dialogue. www.economicswebinstitute.org Cutting-edge research & implementation consulting

14. For further information and support feel free to contact us! Valentino Piana <director@economicswebinstitute.org> Mobile phone: +39 349 36 10 476 Thank you for your kind attention. www.economicswebinstitute.org Cutting-edge research & implementation consulting