The 16th Conference of Parties to the United Nation Framework Convention on Climate Change closed officially this weekend, raising mixed reactions among delegates and those involved with climate change policy all over the world. Despite the low expectations, the Cancun Conference managed to score some points in the direction of settling core issues in international policy such as discussing the future of the Copenhagen pledges, increase the transparency in motoring, reporting and verification, establish a technology transfer mechanism, address deforestation, and launch a green fund for climate finance.

With the support of 193 parties, overriding the objections of Bolivia, the UN conference adopted the text developed during the conference, which includes the anchoring of the pledges made during the previous UN conference in Copenhagen. The Conference confirmed the future role of the market mechanisms created under the Kyoto Protocol, which will continue to remain available to Parties. Moreover, the eligibility of carbon Capture and Storage (CCS) within the Clean Development Mechanisms (CDM) will henceforth be allowed, provided that issues over leakage, liability and environmental impacts are addressed.

The Cancun conference also agreed on a new set of rules to increase the transparency of monitoring, reporting and verification (MRV) rules, making them voluntary for developing countries. The Cancun decisions also addressed the role of forests in the mitigation actions of developing countries, which are encouraged to undertake the following activities: Reducing emissions from deforestation; Reducing emissions from forest degradation; Conservation of forest carbon stocks; Sustainable management of forest; Enhancement of forest carbon stocks. Moreover, countries should develop a national action plan, with an adequate monitoring system, thus setting the stage for the development of a global Redd mechanism, although details on the implementation such as the role of market have not been clarified yet.

Recognizing the important role of finance, the Cancun conference provided for the creation of a Green Climate Fund, as the operating entity of the financial mechanisms of the Convention (UNFCCC), which aims to raise $100 billion per year by 2020 and will be managed by a board with equal representation between developed and developing countries with the World Bank as a trustee.

The adopted text also addressed technology transfer, capacity building and adaptation, establishing a Technology Mechanism to enhance technology development and transfer to support action on mitigation and adaptation, calling for a strengthening of the institutions targeted at capacity building, and establishing the Cancun Adaptation Framework, managed by an Adaptation Committee, whose composition, modalities and procedures will be finalized after the submission of Parties on February 21, 2011.

Despite progress in many areas, the Cancun conference did not deliver an agreement on binding emission reductions, leaving countries free to submit their new pledges, nor said a final word on the future of the Kyoto process. In fact, it remains unclear what the future of the Kyoto architecture could be, but some observers commented that not having it ruled out of a future climate agreement is already a progress. The full text of the decisions taken during the Cancun conference is available at http://unfccc.int/2860.php.

Climate Policy News

• This news is extracted from the Climate Policy News : a CMCC weekly column that summarises the latest news on international climate change agreements, the updates on the carbon market and the energy and technology updates in the realm of climate change. Go to the web page and see all previous issues since March 2007.
• This week: EU ETS phase III: the Eastern group tries again; Cancun: mixed feelings on the day after; the carbon market this week – Download the December 6-12, 2010 Newsletter [pdf 105 kb]