Current climate info insufficient

Frankfurt/Geneva/Nairobi: The availability of and access to climate change information remains insufficient, according to many of the world’s leading financial institutions. A pioneering study launched last week confirms the increasing financial relevance of climate change and the fact that insurers and lenders need better information regarding the physical and economic impacts of the world’s changing weather patterns.

The report, sponsored by the German Federal Ministry of Education and Research, presents the results of an international survey undertaken by the Climate Change Working Group (CCWG) of the United Nations Environment Programme Finance Initiative (UNEP FI) and the Sustainable Business Institute (SBI), Germany. More than 60 institutions, from both developed and developing countries, took part in the survey.

Financial service providers and their customers are increasingly affected by the impacts of climate change, such as extreme weather events. Moreover, the survey shows that insurers, reinsurers, lenders, and asset managers expect these kinds of risks to increase in the future.

Given that financial institutions are able to influence their clients and investee companies across all sectors of the economy, they can play a key role in accelerating the implementation of adaptation measures by the private sector.

But in order for the sector to manage climatic risks affecting their business portfolios and to give the best possible advice to their customers, financial institutions need access to applied information such as climate change predictions, modelling, analysis, and interpretation. Such information needs to be appropriate to the duration of contracts, the regions where customers hold assets or undertake operations and the hazards that are material to the operations of borrowers, investees, and the insured.

“To date the key role that financial institutions and other private sector decision- makers can play in increasing the climate resilience of economies and societies has been neglected at best,” said Paul Clements-Hunt, Head of UNEP Finance Initiative.

“The rapid reduction in greenhouse gases and the adaptation to the unavoidable effects of global warming need to go hand-in-hand if we are to cope with the climate challenge. This study is a first step in identifying what is needed so that financial institutions can start playing their important role in accelerating the shift to climate-resilient economies,” he added.

Climate change forecasts and predictions of the resulting economic impacts will never be perfect and will inevitably feature some element of uncertainty. But the more information and expertise regarding climate change and its uncertainties that is available to financial institutions, the better these risks can be calculated. This will enable insurers, reinsurers, lenders, and asset managers to price and absorb these risks more effectively.

This can be crucial not only to the performance of individual businesses and financial institutions, but to the entire economic tissue of communities affected by climate change and the social well-being it underpins.  “Financial institutions are experts in identifying, quantifying and pricing risks. This expertise can be of great value to society at large when faced with the sheer uncertainty linked with changing climate patterns and the significant risks of resulting impacts,” said Mark Fulton, Managing Director at Deutsche Bank Climate Change Advisors and Co-Chair of UNEP FI’s Climate Change Working Group (CCWG).

“This study confirms that what private sector institutions need in order to become real ‘adaptation catalysts’ is objective and reliable information. We need to work towards enhancing the access of private sector decision makers to climate information as well as, most importantly, improving the reliability and accuracy of our climate models and forecasts”, he added.

The survey identified that such information gaps can be closed by continued research towards more reliable climate modelling and forecasting, as well as enhanced translation of scientific knowledge and existing information into user-friendly information. Such efforts are likely to require more intensive collaboration between users and suppliers, public and private actors, scientists and decision makers.

UN to ramp up climate change talks in 2011

REUTERS: The United Nations is likely to hold two extra meetings to discuss climate change in 2011 as the deadline to meet targets of Kyoto Protocol fast approaches in end-2012, a top United Nations official said.

“We’re running out of time... Governments will need to decide this year how they want to take that (Kyoto Protocol) forward,” Christiana Figueres, the head of the UN Climate Change Secretariat, told Reuters on the sidelines of the world future energy summit in Abu Dhabi.

The 1997 Kyoto Protocol binds almost 40 industrialised nations to cut greenhouse emissions by an average of 5.2 per cent below 1990 levels during the five-year period 2008-2012. However, rich and poor nations are deeply divided about what to do after its first period runs out.

Figueres said the world had made progress at the last meeting in Cancun, Mexico in December, where almost 200 nations agreed a package including a new fund to help developing nations cope with climate change and to try to limit a rise in temperatures to below 2 degrees Celsius (3.6 F) above pre-industrial times by curbing carbon emissions.

“The Cancun agreement was by far the most significant and collective agreement on how much is going to be cut in terms of carbon emissions,” she said. “That is not to be underestimated.” “At the same time, it’s not enough,” she said. “We need to deepen emission reduction commitments that we have on the table now, they are 60 per cent of what we need to achieve. This is another thing the governments need to address this year.”

To discuss these topics and find ways to overcome the challenges, there was a good chance there would be extra meetings in 2011 – one in April and another in fall possibly, Figueres said. There are scheduled talks in June and December.

In 2009, the UN held four extra sessions in the run-up to the Copenhagen summit, which fell short of agreeing a treaty.

“Governments have to build the institutional infrastructure needed and further discussions have to occur on how to bring about deeper emission cuts,” Figueres said.

She said it was likely that the meetings would take place in a U.N. location.

The targets of the Kyoto Protocol were meant to be extended beyond end-2012, however, Japan, Canada and Russia have said they will not extend unless all other big greenhouse emitters also take on targets in a single new pact.

Another major problem the protocol faces is the lack of blessing from the United States.

One of the world’s major carbon emitters, the U.S. has never ratified the Kyoto Protocol and the opposition in the U.S. Senate means that President Barack Obama may be unable to legislate the cuts in emissions by 2020 that he favours.

Building cities braving the extremely hot temperatures and putting significant amounts of energy to cool these cities, Gulf countries are among the world’s highest carbon emitters per capita.  Qatar, where the World Cup 2022 will be held, is on top of the list.

Figueres urged Qatar to seek alternative sources of energy.

“We hear that Qatar is exploring what options they have to use alternative energy sources to power the World Cup,” she said. She did not give details.  The World Cup is traditionally held during the northern hemisphere’s summer months after the end of the domestic football league competitions.

“It is a great opportunity for them to use cutting-edge technologies to show to the world that you can achieve cooling in an environmentally sustainable way,” she said. But she also said the existence of places like indoor ski slopes, where massive amounts of energy is required to achieve sub-zero temperatures, were contradictory with the global efforts to cut carbon emissions.

“The challenge is to figure out how you differentiate between energy that is absolutely crucial for growth,” she said.

“We have so many people without electricity and so many people at the poverty level....Those are the issues which should be the focus energy applications and a priority.”

New climate data shows warming world: WMO

REUTERS: Last year tied for the hottest year on record, confirming a long-term warming trend which will continue unless greenhouse gas emissions are cut, the World Meteorological Organization (WMO) said on Thursday.

The first 10 years of the millennium proved to be the hottest decade since records began in the 19th century, it said.

“The main signal is that the warming trend continues and is being strengthened year after year,” WMO Secretary-General Michel Jarraud told a news conference.

“The trend, unfortunately, will continue for a number of years but the amplitude will depend on the amount of greenhouse gases released,” the Frenchman added. “It will depend on action taken to minimise the release of greenhouse gases.”

Jarraud said the latest data should convince doubters about the growing evidence for man-made climate change. “If they look at it in an unbiased way, it should convince them, or hopefully a few of them, that the sceptical position is untenable.”

2010 was also marked by further melting of Arctic ice – in December its extent was at its lowest on record, the WMO said – and by extreme weather, including Russia’s heatwave and devastating floods in Pakistan.

Rising temperatures, already about 0.8 degree Celsius above pre-industrial times, mean the world will struggle to limit warming to below 2 degrees Celsius, a target agreed by almost 200 nations at U.N. talks last month in Mexico.

Many experts see 2C as a threshold for dangerous climate change, like more heatwaves, droughts, floods and rising seas.

“We have to act very fast and strongly” to limit emissions, said Bob Ward, of the Grantham Research Institute on Climate Change and Environment at the London School of Economics and Political Science.

He noted that many skeptics say global warming has stopped because of no new records since 1998, when temperatures were boosted by a strong El Nino event that warms the Pacific.

“But they cannot explain away the fact that nine of the 10 warmest years have occurred since 2000,” he said.

“Data received by the WMO show no statistically significant difference between global temperatures in 2010, 2005 and 1998,” the United Nations body, which compiles its ranking from data provided by British and U.S. agencies, said in a statement.

Data from British institutes on Wednesday showed last year was the world’s second warmest behind 1998, while the other two main groups tracking global warming, based in the United States, said 2010 was tied for the hottest on record.

Over the 10 years from 2001 to 2010, global temperatures have averaged 0.45 degrees Celsius (0.83 degrees Fahrenheit) above the 1961-1990 average and are the highest ever recorded for a 10-year period since climate records began, WMO said.

The difference between the three hottest years was less than the margin of uncertainty in comparing the data, according to WMO, whose assessment is based on climate data from land-based weather and climate stations, ships, buoys and satellites.

The fight against global warming suffered a setback in the wake of the financial crisis, slowing funding for renewable energy projects and knocking momentum from international efforts to agree a climate deal to succeed the Kyoto Protocol in 2013.