NDC updating – what might it involve?

NDC updating – what might it involve?
16 October 2018

NDC updating – what might it involve?

We’ve seen the call to action. The latest report from the Intergovernmental Panel on Climate Change (IPCC) is stark. We have 12 years to act to avoid catastrophic climate change. But we also know that the current pledges, or nationally determined contributions (NDCs), from countries are not sufficient.
 
Moreover, while most countries have submitted NDCs with quantitative objectives and/or targets, many specific pieces of information are missing in order to precisely assess the mitigation impact of NDCs and to track progress with the implementation and achievement of the NDCs.
 
Fortunately, the Paris Agreement was designed to recognise and address this. It requires countries to update their NDCs every five years from 2020. However, it remains silent on what such an update might entail, simply stating that each successive NDC must be a ‘progression’ on the current one.
 
So, what are the options for a country looking to update its NDC? Before the Paris Agreement, Ricardo worked with 17 countries to develop and submit their NDCs – focussing on incremental climate actions intrinsically tried to long term national development goals.
 
But whatever approach a country chooses, they will need to start soon. The updated NDCs need to be submitted no later than February 2020, which is only just over a year away. And with the IPCC’s call to action ringing in our ears, we know that this next update will be crucial.
 
Here are some of the options that countries can take to ramp up their ambitions in the next phase of their NDCs.

Tighter 2030 targets

Most NDCs include some kind of quantified targets for 2030. And an obvious way to update the NDC would be to change these targets to be more ambitious. This will require modelling of future GHG emissions scenarios for the country and an assessment of mitigation potential within and between sectors. It should also consider longer-term emissions goals and pathways. For example, if a country has committed to ambitious emissions reductions by 2050, more ambition might be needed by 2030 than what is currently envisaged to ensure the country is on track to the longer-term target.

Expand the scope of the NDC

Most NDC emissions targets cover all or the majority of sectors, for example power, transport, agriculture, waste, forestry and industry. But many do not. And those countries could consider bringing more sectors into the scope of the quantified target, thus driving more action in those sectors. In some cases, strategically important and high-emitting sectors were left out of the NDC target, simply due to a lack of robust data to support the case for action. So expanding the scope of the NDC might require new data to be collected to build a sound evidence base for policy makers to take decisions. We support governments to take a sector specific approach to NDCs, tying actions on climate change into sectoral development – whether that is delivering climate resilient agriculture, implementing a low-emission national vehicle fleet or securing greater energy impendence through renewable technologies.

Introduce new policies

 Many NDCs not only contain a target for reducing GHG emissions, increasing renewable energy etc, but also set out the policies that will deliver the targets. These might be policies that are already in place, or ones that the country plans to introduce in the future. A country might look to update its NDC by committing to new policies. Bearing in mind the latest IPCC report, proposing new policies that focus on near term action would be particularly welcome. For example, while policies that might facilitate future technological change and emissions reductions, such as investment in electric vehicle charging infrastructure, is welcome, policies that have a more immediate impact on GHG emissions, such as incentive schemes to change behaviour, would be particularly positive.
 
In addition, or alternatively, a country could look to update an existing policy, to make it more ambitious, for example by committing more money to it, extending its scope or speeding up implementation. Analysing the predicted outcomes of updated policy changes on specific sectors with modelling software such as with Ricardo's transport policy analysis tool SULTAN can help identify where additional resources or focus will have the greatest impact on meeting GHG emission targets.  
 
Of course, NDCs are not just about reducing GHG emissions but also adapting to the effects of climate change that are already unavoidable. An updated NDC might therefore also contain new policies and actions to strengthen climate resilience.

Commit more support for climate action

 This is particularly the case for developed countries, but even developing countries could consider devoting more domestic resources to climate action. This could be done by mainstreaming climate change considerations into the fiscal budget. In addition, an updated NDC for a developing country could announce a new partnership with international donors for supporting climate action. Several green finance mechanisms, such as the Ricardo led Climate Finance Accelerator, aim to support developing countries to enhance their climate finance readiness by developing bankable proposals and identifying funding streams for priority NDC projects.

Develop more robust transparency systems

 The Paris Agreement envisages an ‘enhanced transparency framework’, to “build mutual trust and confidence and to promote effective implementation”. Also known as measurement, reporting and verification (MRV), this means tracking and understanding progress towards implementing and achieving the NDC. After all, knowledge is power. A country can only successfully and effectively implement its NDC if it understands what impacts its actions are having and how well it is doing in meeting its targets. Many countries already have some kind of transparency or MRV system in place. Indeed, all countries already regularly report GHG inventories, which form a key part of an NDC transparency system. But most countries could also do more to make the GHG inventory estimates more accurate and/or expand this to be a comprehensive and robust transparency system. The updated NDC could set out the detailed plans for how this will be done, with a proposed design and framework for the transparency system. Our GHG emissions teams are working with nations across the world to develop inventory and transparency systems that accurately report on the impact of mitigation and adaptation actions.  

Report on progress

Linked to the option above, a country may choose to update its NDC by reporting on action that has been taken since the current NDC was published. After all, catastrophic climate change won’t be met through commitments and proposals, but by action. An important element of an updated NDC might therefore be a report on what actions a country has taken in the last few years since the current NDC and what impacts these actions have had.

Improved governance structures

 Climate action will only happen if appropriate governance structures are in place, to drive forward action, ensure accountability and increase buy-in and engagement from key partners. The updated NDC could report on what new governance structures have been put in place and how these are improving the effectiveness and efficiency of climate action in the country. Ricardo’s ‘Planning for NDC implementation - a quick start guide’ provides routes for policy makers to ensure effective governance by obtaining buy-in and integrating NDC implementation into national policy

Summary

 Above we have a menu of options. But it’s not a case of ‘either-or’. Indeed, in the context of the latest IPCC report, the more each country can do, the better. So an updated NDC might include more sectors, a more ambitious target than the previous NDC, an announcement of new domestic funding sources and a planned programme of work to develop more robust transparency systems.
 
After this round of updating, the next NDC updates will be in 2025. Thanks to the latest IPCC report we know that we only have until 2030 to avoid catastrophic climate change. By 2025 it is getting rather late. If we are to collectively take the ambitious action that is needed to avoid the nightmare scenario, it really needs to be done in this next round of NDC updating.
 
To discuss your options for the next phase of NDC development and how to implement climate change projects which supporting national development, feel free to contact me at james.harries@ricardo.com
 
 
Annex A – details of the Paris Agreement in relation to NDC updating
 
The text of Decision 1/CP.21, which accompanies the Paris Agreement, says the following:
 

  1. Requests those Parties whose intended nationally determined contribution pursuant to decision 1/CP.20 contains a time frame up to 2025 to communicate by 2020 a new nationally determined contribution and to do so every five years thereafter pursuant to Article 4, paragraph 9, of the Agreement;

  2. Also requests those Parties whose intended nationally determined contribution pursuant to decision 1/CP.20 contains a time frame up to 2030 to communicate or update by 2020 these contributions and to do so every five years thereafter pursuant to Article 4, paragraph 9, of the Agreement;

 
From this it can be seen that only countries with INDCs that run to 2025 need to submit a new NDC by 2020. Those countries that have INDCs that run to 2030 – which is the majority of countries – only need communicate or update their NDCs by 2020 and every 5 years thereafter. So from this, it would seem that countries with 2030 INDCs would be allowed to simply communicate their original INDC again in 2020.
 
However, article 4 of the Paris Agreement proper gives more information on mitigation and says the following:

  • Article 4(2): Each Party shall prepare, communicate and maintain successive nationally determined contributions that it intends to achieve. Parties shall pursue domestic mitigation measures, with the aim of achieving the objectives of such contributions.
  • Article 4(3): Each Party’s successive nationally determined contribution will represent a progression beyond the Party’s then current nationally determined contribution and reflect its highest possible ambition, reflecting its common but differentiated responsibilities and respective capabilities, in the light of different national circumstances.

The fact that article 4(3) talks about each successive NDC representing a progression beyond the current one, suggests that even countries with NDCs that run to 2030 should be looking to update them by 2020.
 
Paragraph 25 of 1/CP.21 gives the proposed timing for the updating:

  1. Decides that Parties shall submit to the secretariat their nationally determined contributions referred to in Article 4 of the Agreement at least 9 to 12 months in advance of the relevant session of the Conference of the Parties serving as the meeting of the Parties to the Paris Agreement with a view to facilitating the clarity, transparency and understanding of these contributions, including through a synthesis report prepared by the secretariat;

 
Assuming the 2020 COP is held in November 2020, this would mean the updated NDCs would need to be submitted at least by Nov 2019 to Feb 2020.
 


[1] The Paris Agreement actually makes somewhat conflicting statements on this but the interpretation is that every country is expected to update their NDCs every five years from 2020 – see annex A for more details.