core sector communique

U.S. Preview of Climate Change Conference in South Africa

FOREIGN PRESS CENTER WITH SPECIAL ENVOY FOR CLIMATE CHANGE TODD STERN

TOPIC: A PREVIEW OF THE CLIMATE CHANGE CONFERENCE (COP-17) IN DURBAN, SOUTH AFRICA

THE WASHINGTON FOREIGN PRESS CENTER, WASHINGTON, D.C.

TUESDAY, NOVEMBER 22, 10:00 A.M. EST

MODERATOR: Good morning. I'd like to alert our team on the phone lines that we're beginning our press conference, our briefing right now.

Thank you for joining us this morning. Todd Stern, the special envoy for climate change, is here and he's going to be giving us a briefing on the COP-17, the climate change conference coming up in Durban from November 28th to December 9th. In addition to yourselves, I'd also like to welcome our callers calling from the Pretoria hub in South Africa as well as our journalists and colleagues in - at our Foreign Press Center in New York.

So we'll start with opening remarks from Todd Stern without further ado.

MR. STERN: Thanks so much, Dick. Hi, everybody. Thank you all for coming. I'm pleased to be here. I'd like to talk with you for a few minutes today about the upcoming meeting in Durban and then I'll take your questions.

I think that the focus of that meeting will be both on what happens to the Kyoto Protocol and on making the key elements agreed to in Cancun last year operational. Both of these involve the period from now to 2020, and that's the relevant period for the two tracks of the negotiations.

Let me say a few words about Cancun first, and also address what I think is a common misconception. I get asked all the time, all during the year, when we're going to finally reach an agreement - are we going to reach an agreement this year or next year - and I always say the same thing, which is we reached an agreement. We reached it last year in Cancun. And if you look at that agreement, you will find a major undertaking involving all the parties.

It anchors the mitigation pledges made for the first time, I might add, by all major players, developed and developing, in Copenhagen. It calls for the creation of a transparency regime for both developed and developing countries through the writing of relevant guidelines. It calls for the establishment of a new green climate fund. It calls for the establishment of a technology executive committee and a technology center and network, and also for the creation of an adaptation committee. In general, it aims to establish the institutions that will guide the climate - guide international climate action for a long time to come. And while it is not legally binding, it is a decision of the COP taken under the UNFCCC - the underlying treaty - and as such, represents a solemn commitment by all the parties. Nobody takes it lightly.

Now the other main track is Kyoto, and what happens there is the other key issue in Durban. Only - the only major player at this point that seems ready to do something with respect to Kyoto is the EU. Japan, Russia, and Canada have all said no. Australia is not clear yet. So what we're talking about here is a potential second commitment period, as they say, of the Kyoto Protocol. And exactly what the EU might do is not yet clear. There are various potential options on the table that range from the EU agreeing to a COP decision saying that they reaffirmed their Kyoto targets and plan to carry them out.

And on the other end of the spectrum, it would be an actual amendment to the Kyoto Protocol for a legally binding second commitment period. In order to have a legally binding second commitment period of Kyoto, you actually have to do an amendment and get it ratified on the Capitol. So somewhere in between, a COP decision and an actual amendment is what's being discussed now. The U.S. obviously is not a player on this particular point.

So again, the focus is on these two tracks and the period between now and 2020. There is also some attention being given to what might be said about the period after 2020 since the targets and actions that have been put forward by countries only run to that time, so what happens after 2020, has not been spoken to yet. And there's been some discussion given as to what the nature of such an agreement might be and how and when the process for discussing a post-2020 accord should get underway. Some countries want to stipulate up front that it should be a legally binding agreement. Others, including us, have indicated that they want to know more about what the content of such an agreement would be before they commit to a particular legal forum. One thing I would certainly underscore about any post-2020 accord is that the only way it could be effective and garner broad support is if it fully applies to all significant countries.

So there's still a lot of work to be done in the few weeks between now and the end of the COP in order to achieve a successful outcome in Durban, one that is balanced across all the major issues and makes good progress on all those issues. We are committed to working with the South Africans and our partners throughout the world in order to solve the remaining open issues and secure a strong and pragmatic outcome.

And with that, I'd be happy to take questions.

MODERATOR: Before we begin, I'd like to ask our callers in Africa to press *1 if they're interested in getting into the queue to ask questions. Again, that's *1. We have only a limited amount of time today, so we'll take a couple of questions here, then go to our callers in Africa, then go to the Foreign Press Center in New York.

So let's begin here. Yes.

QUESTION: Yeah, hi. Nick Juliano with Platts newsletters. I wanted to ask you about the recent actions we've seen on EPA (ph) with regard to their greenhouse gas rules. Just yesterday, they said they're going to be delaying the fruit refinery rules. The power plant rules have been delayed a couple times. What kind of difficulty is that presenting for you in these negotiations, and how are you sort of explaining this relatively slow progress to --

MR. STERN: Well --

QUESTION: -- the other countries?

MR. STERN: Yeah. I actually think EPA has done - has been very strong on the - on action that pertains to climate change so far. I mean, if you look at the actions in the whole transportation sector, which is about a third of our missions, it's been actually pretty remarkable. The first set of new regs went into effect and cover the period up till 2016 and increased the miles per gallon level up to 35 or so. And new regs have been announced - they're going through the process - but have been announced that would kick that all the way up to 54-plus miles per gallon to take effect in 2017. So that's huge, actually.

I think that they are also working on stationary source regs and regs that involve other pollutants that could have some relevance. So I think EPA has had a lot on its plate. I don't think any of the scheduling that you've talked about is a concern, either - it's not a concern to me and I don't think it's a concern for me in terms of my discussions internationally. I think EPA is seen to be a quite active player.

MODERATOR: Okay. One more question here, then we'll go to Pretoria. Yes.

QUESTION: Pat Reber from DPA.

MODERATOR: Wait for the mike.

QUESTION: Oh, sorry. Pat Reber from DPA.

MR. STERN: Hi, Pat.

QUESTION: Hi. Mr. Stern, I wanted to ask you - there were reports - on the Green Climate Fund, there were reports that the United States and Saudi Arabia withheld their approval of a consensus document going into Durban. And as this is one of the key issues that hopefully - people hope will be decided in Durban, I'm wondering if you can comment on what the U.S. reasons were.

MR. STERN: Sure, absolutely. Well, let me say first that the U.S. is a strong advocate of the Green Climate Fund, and we have been, actually, since the idea was first floated by the Mexicans. It was actually an idea that came, as I understand it, from President Calderon. And we have been quite focused on it since the beginning, really, and we gave it a platform for substantial discussion at our - one of our early MEF meetings, Major Economies Forum meetings, in Paris in 2009, and have been, as I say, strong proponents of it all the way through. And we were active participants in the transitional committee process. That's a process that - where the negotiations took place this year.

There was a meeting at - the fourth meeting of the transitional committee took place - I think it was the 16th to the 18th of October in Cape Town. There were - there was a lot trying to get done in a very short period of time. The final draft that was put on the table was put on the table at sometime after 7:00 at night and with the objective of getting it done in less than an hour. We had a number of concerns about a few issues that we thought could use some further attention. I think there were a number of parties in the room, actually, that were interested in having a little bit more time, whether it was working through the night or coming back the next day or whatever to try to clean a few of these things up. That didn't happen, so we agreed to have the document forwarded to the COP for action, which is what happened. We didn't block the document going forward, but we weren't prepared yet to fully adopt it because there are some things that we think are a little bit problematic.

I am pretty confident that we're going to be able to work these things out. We are working with and have been talking to the South Africans and others. It's a process that will work its way through in Durban, but the U.S. is a strong supporter of the basic concept, and I think we'll be able to work out the additional matters.

MODERATOR: Okay. We'll switch now to Pretoria, my colleague Carrie Denver in South Africa. Carrie, are you there?

OPERATOR: Yeah. Thank you, Dick. I just wanted to remind our callers in Nairobi, Durban, and Addis Ababa to press *1 to enter the question queue. And that's *1 to enter the question queue. And Dick, I'll go ahead and hand it back to you while we're waiting for callers to enter the queue.

MODERATOR: That sounds great, Carrie. Thank you. We have more questions here. We don't have any in New York, I see.

So, please.

QUESTION: Hi, Brian Beary from Europolitics. One of the - I'm just wondering, I'm going to posit a narrative to you and see what you think - that Washington is always expecting Beijing to do something, which is always expecting Washington to do something. And that there's a cycle of inaction going on with neither taking on commitments, because everyone is just - both are just looking at each other and saying, well, you need to do it, and then you need to do it. What's your view of - is that an accurate depiction of what's happening?

MR. STERN: Not in my view. I actually don't think that's what's going on. Again, we thought that what happened last year in Cancun was a really, very significant agreement. I think it just was the most significant agreement since the Kyoto Protocol, really. And I think that we worked very constructively with the Chinese.

I deal - I interact a great deal with my Chinese counterpart Chu Zheng Wa (ph), who I have great respect for. And - so I don't really think that we were in a mode of saying we're not going to do X and - I mean, what we have said is that with respect to - you've probably heard me say this - with respect to some future treaty, when you talk about what form it might take, we have said it - first of all, we've said in the future regime, all major players need to be engaged in a quite similar fashion. What is true about Cancun and Copenhagen is that all major parties have taken steps together, which had never happened before. So we think that that was terrific. And China's very much part of that.

So for the - but I've also said, with respect to a potential future legal regime, we wouldn't do it if all the major economies weren't also part of it in a quite full way. So in that sense, we would need to see that action from others. But I don't think it's that kind of - we're waiting for China. I can't tell you whether China's waiting for us or not, I can only speak for the United States. But I really don't see it that way.

MODERATOR: We'll move now to our foreign press center in New York. Could you please give your name and your news organization?

QUESTION: Nadinir Fichi (ph) from Eyewitness News. I want to find out - there is a call for rich countries to contribute to a fund to help poorer countries finance their efficiency improvements. What's the U.S.'s stance on this?

MR. STERN: For developed countries to contribute to the green climate fund?

QUESTION: To the - yeah, to the hundred billion dollar fund that they are calling for richer countries to help out the poorer countries in their efficiency improvements?

MR. STERN: So let me make a couple of comments about that. First of all, absolutely we intend - U.S. intends to be part of the effort to mobilize - the agreement in Copenhagen and then in Cancun was by developed countries to a goal of mobilizing $100 billion a year by 2020, and we absolutely intend to be part of that. We have been part of the fast start financing effort that was in the 2010 to 2012 phase. So yes, we're absolutely going to be part of that.

I do want to correct another misconception that I've heard a lot and that was, I think, just embedded in that question. It is not a $100 billion green fund. It is a commitment to mobilize $100 billion from all sources. That will be bilateral, it'll be multilateral. It'll be public, it'll be private. It'll be carbon markets, it'll be from all sources. Some part of that will go through this new vehicle that we're setting up, which is a green fund. And I don't know what - how much of the hundred, some part of it. But it's not a $100 billion green fund, and that is - I've, again, this is a question I've gotten many, many times, and I try to correct the record when I hear it.

MODERATOR: We'll take one more question here and then we'll go to Pretoria for a couple questions there. Please.

QUESTION: Alright, thank you. My name is Haijun Ren with China Xinhua News Agency. I have two questions. The first one - as I know, last week, a major conference was held in Arlington, Virginia, and I want to know: Did you narrow your differences among the negotiation parties? And second one is, can you specify the U.S. Government's stance on the so-called dual-track negotiation mechanism?

MR. STERN: On the dual-track negotiation?

QUESTION: Mechanism system.

MR. STERN: Uh-huh.

QUESTION: Okay. Thank you.

MR. STERN: I thought we had a very good meeting at - of the Major Economies Forum last Thursday and Friday, and I think that these sessions - I've lost track of how many we've had, it's eleven or twelve or something, we would always do three or four every year - and I think that they have been very useful. I think it was useful last week. I think we - yes, I think we narrowed differences in a certain way; it's hard to completely pinpoint what happens.

What goes on is that people discuss their views; they discuss their concerns about XYZ issue. And in hearing that at senior levels, at ministerial levels from that group of twenty or so major countries, and some less major who are invited to attend, I think that that helps to frame for people where the possible deal can be going into Durban. And that is, the closer you get to Durban, the more you start framing what could be an actual solution. When you have an - we had a meeting in Brussels in April, we were talking at a much more - at a broader level. So I think it was a good meeting and I hope that we have narrowed some differences.

The - on your second question, U.S. isn't part of one of those two tracks, so I don't have that much to say about it. I think it's up to the Kyoto parties what they want to do about Kyoto. I think that the other track is the track that involves all the parties, not just the Kyoto parties. That's the one we're in, that's the one we're the most focused on. And I think whether, in the future, if you think about 2020 and going forward beyond 2020, whether we will have two tracks or those two tracks will merge into one, I think is an open question. And again, I think we will wait and see how that goes. We don't have a - we're not in Kyoto, so I'm not going to comment on it.

MODERATOR: Turning now to Pretoria, South Africa. Carey, you have any callers there?

OPERATOR: Yes. Thank you, Dick. Our first question comes from our embassy in Addis Ababa. Please state your name and affiliation before asking your question.

Operator, please open (inaudible). Your line is open.

QUESTION: Okay, thank you. My name is Omar Edi, I'm a correspondent for Enterprise Service. Mr. Stern, you mentioned the U.S. is a strong advocate of the GCF. But the other element of the climate change negotiations - greenhouse gas emissions cuts, and the U.S. doesn't have a similar positive record in that regard. Are we going to see any change in this regard (inaudible)?

MODERATOR: Could you ask the first part of your question once again? It wasn't quite clear. Very short and quick - could you ask that again, please?

QUESTION: I just said you mentioned that your government is a strong advocate of the Green Climate Fund, but at the same time, you don't have such a similar record in committing to cut your greenhouse gas emissions. Are we going to change, in Durban, in U.S. stance in greenhouse gas emission cuts?

MR. STERN: I got it, now. Thanks very much. Well, look, the U.S. has put a target - submitted a target in the period right after Copenhagen of cutting in the range of 17 per cent below 2005 levels by 2020. That's our target; that's what we're trying to do. I mentioned earlier the very aggressive action that EPA has taken with respect to a third of our emissions profile. There's a lot of other action going on in the U.S. as well. EPA work on stationary sources, work on appliance standards through the Department of Energy; a huge amount of investment that went on in the range of $90 billion or more as part of the Recovery Act; legislation that was enacted in 2009 and that has led to things like - what will, by the end of next year, be a doubling of renewable energy in the United States; very strong advances in areas like electric vehicle production and battery production for electric vehicles; and a whole host of things. So U.S. is actively engaged in the activities that lead to emissions reductions. We're, I think, around 6 or 7 percent below 2005 right now - I don't know the latest numbers. But - so I think we will - our commitment is to meet that target.

MODERATOR: Carrie, you have another one?

OPERATOR: We have two more questions. The next one is from our Consulate General in Durban. Please state your name and affiliation before asking your question.

Your line is open.

QUESTION: Yes, thank you. My name is Tony Carnie, I represent Independent Newspapers in Durban. Mr. Stern, you were closely involved in the process leading up to the Kyoto Protocol, which was a legally binding instrument. Your country, unfortunately, now treats it with some contempt. Now, your position on the Kyoto Protocol is quite clear, but they did, nevertheless, a logjam that has been existing for a number of years now. My question really is: Would the United States be prepared to consider a mechanism to break the logjam by saying, "Yes, we will sign into Kyoto for the second period, legally binding; thereafter, for the third period, we're not going to do anything unless China, for example, is also part of the deal?" Someone's got to make the first move. Can you respond, please? Thank you.

MR. STERN: Sure. Thanks very much for the question. Well, the short answer to your question is no, we're not - Kyoto is not on the table for the U.S. And we don't - look, we don't see the Kyoto being a logjam. We see that the regime of dealing with climate change at the international level has to open up and grow and include all major economies, at least, and then even beyond that, in time. And that's what started to happen in Copenhagen, and happen more in Cancun, in a regime which, again, as I said, is a very serious undertaking. It's a decision of the Conference of the Parties, of the COP, taken under the Framework Convention treaty, and it's not done casually or lightly. It's a serious deal. It's not legally binding, but it is a serious deal. So that, to us, is the track forward, and we don't see an agreement that is premised on - even if the U.S. were in it - premised on a much smaller total of emissions as compared to Cancun being the right path. And so no, Kyoto is not on the table for us.

Carrie, one more?

OPERATOR: Yes, one more. Thank you. The next question comes from Johannesburg, South Africa. Your line is open.

QUESTION: Hi. My name is Devin Nealy, and I'm calling from the Dow Jones newswire. And I just wanted to follow up on some of the comments about the Green Climate Fund to make sure I have all the information right. You mentioned that only part of the hundred billion target, raising target, is going to be for the Green Climate Fund, and I was wondering if you could elaborate on both where the rest of the money would go to and what kind of budget the Green Climate Fund might fund.

And also, in terms of the U.S. participating, the - China's delegates, the Chinese delegates, made quite a lot of comments, saying that the developed world should foot the bill because they caused a lot of the emissions problems. Now, but given the way the current global economy is, how does the U.S. respond to that?

MR. STERN: Thanks for the question. So a couple things. Let me try to walk through how I - in a broad sense, how I envision the hundred billion dollar funding commitment to work. There - I think if we get it up and running and it works properly and it grows and develops, the Green Fund will be a vehicle that receives a significant amount of government contributions. That money will then be used for a whole host of purposes to support mitigation projects in developing countries, whether it's developing solar, wind, geothermal, other kinds of energy like that or helping to finance efficiency projects or helping on, very importantly - maybe most importantly for the Green Fund - helping to focus on adaptation efforts. So that - I can't tell you whether that's - what the amount's going to be, but that, I think, will be a significant portion.

There will also continue to be, certainly in the U.S. and I'm quite sure also in Europe, my guess is in Japan, I can't speak for everybody else, but I think there will continue to be a lot of funding that goes through bilateral channels, directly country to country, that won't go through the Green Fund. The Green Fund will - is - will, again, if it works properly, become a prime multilateral channel. There will be funding that probably continues to flow through multilateral development banks.

There will be funding that is leveraged, that is spurred through country development banks, and I'll give you an example of that. Our OPIC, the Overseas Private Investment Corporation, is doing an enormous amount in this area, and has been over the last few years, and is rapidly ramping up. In - these numbers aren't exact, but roughly, in 2009 OPIC put in a hundred and something million dollars of - and I can - I'm sure we can get the exact numbers, but over a hundred million dollars of support for green energy development in the developing world. In 2010, that number went up to well over - I think over 250 million, and this year it's over a billion. It's a very rapidly rising trajectory. And OPIC - and that doesn't even count the leveraged amounts of money that come in from the private sector. So when OPIC does a project, every dollar it puts in draws another dollar or two or three from the private sector. So if OPIC has put in a billion of its own financing this year, that is - that has, in fact, spurred probably $2- or $3 billion of investment, and that amount is going to increase. And that's just the United States.

So remember, the hundred billion dollar commitment explicitly includes the private sources as well as public sources. I mean, that was - that's the deal. And carbon markets. So the money is going to come from a whole host of different places. I think that - I expect if the Green Fund works right, it will become the main channel for multilateral public money, but there's going to be a lot of other channels.

Your other question, I think, was about whether just-developed countries should be contributors here. And I think that the answer is that the first expectation centers on developed countries, and we understand that, but I think there will be, if not right away, over time there will be developing countries who also want to contribute to the Green Climate Fund or other means of providing support. And we have already heard from some countries who are interested in doing this.

Interestingly, President Calderon from Mexico, when he first proposed this idea of the Green Fund, he wanted all developed - all countries, developed and developing, to put at least something in to the kitty, something into the fund, even if they were going to be getting more back. That's not the way it was set up in the end, but I think it would certainly be open for developing countries who choose to contribute as well.

MODERATOR: Okay, Carrie. Thank you very much. We'll turn now to Washington, and we'll take one question here.

Suzanne.

QUESTION: Okay. Thank you.

MR. STERN: Hi, Suzanne.

QUESTION: Hi. I wanted to ask you a little bit about the funding under the part - smart - whatever - the Fast Start program over the next three years. And specifically, can you guarantee that U.S. will meet its $1 billion commitment for forest projects over the three years? And also, can you give us an indication of how close or what percentage of the 30 billion will come from the U.S. by the end of 2012?

MR. STERN: Yeah. Sure. So the Fast Start commitment was a joint commitment by developed countries to provide an amount approaching $30 billion in the period 2010, '11 to '12, at least those fiscal year periods. And that was understood to be public money. In that case, as distinguished from the case of the hundred billion, that's not private. Private money's not part of that. Those are government sources.

The - so first of all, you asked about the U.S. commitment to provide a billion dollars on the forest side. I never guarantee anything, so I'm not going to guarantee that. We're working very hard to provide the maximum amount that we can. I think that we will have an amount that's close to that. I don't know if we'll be quite at in the three-year period. We're just going to have to see. We're a year away.

QUESTION: (Inaudible) environmental groups, advocacy groups, are saying that you are 250 short.

MR. STERN: Don't know - I don't know the exact numbers right now, and we are certainly quite focused on that and trying to get those numbers as high as possible. We - it goes without saying, both in the U.S. and Europe and other places, a difficult fiscal environment.

With respect to Fast Start, we - again, I'm not going to get into exact percentages. Our numbers are going to be coming out for 2011 within days. We - and I think it will be - we will, for the two-year period, be in a pretty strong position. For 2010, we did roughly about $2 billion, counting all of our sources. So there was a substantial part of that which is appropriated funds, and then another, I think, around four hundred or so million dollars from our two export credit - well, our - yes, export finance agencies. And I think - I anticipate that the number for 2011 will be substantially higher than that, but we don't have the final yet. We don't have a final quite yet, and it will be coming out very soon.

MODERATOR: I know you're pressed for time today, so you have to leave, but I want to thank you very much. And thanks to our colleagues in Pretoria, South Africa, and New York at the Foreign Press Center there. And thank you very much for joining us.

(Distributed by the Bureau of International Information Programs, U.S. Department of State.)