16 November 2015
INDCs: Foundation for a Successful Outcome in Paris?
Photo by IISD/ENB | Kiara Worth
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INDCs outline the climate actions that individual countries intend to undertake in the post-2020 period, under the new climate agreement to be decided on in Paris.

With the Paris Climate Change Conference just around the corner, 134 intended national determined contributions (INDCs), representing more than 150 countries, have been submitted to the UNFCCC Secretariat as of 12 November, and more are still expected before Paris. INDCs outline the climate actions that individual countries intend to undertake in the post-2020 period, under the new climate agreement to be decided on in Paris.[1] Viewing them in aggregate should enable the tracking of progress and determining whether they represent a collective level of ambition that will be sufficient to limit temperature rise below 2°C relative to pre-industrial levels.[2]

The success of the Paris agreement will, on some level, depend on the level of ambition reflected in the INDCs, how INDCs will be treated in the agreement and, most importantly, whether the Paris agreement establishes a robust system to ratchet up ambition in the post-2020 period. This short policy update describes the history and evolution of INDCs, and takes stock of various assessments of the ambition level of the INDCs submitted thus far. It also examines some of the financial implications of implementing the INDCs, and their significance for the Paris agreement and beyond.

The Birth and Evolution of INDCs

The concept of INDCs was first coined during the 19th session of the Conference of the Parties (COP 19) to the UNFCCC in Warsaw, Poland, in November 2013, where the COP decided “to invite all Parties to initiate or intensify domestic preparations for their intended nationally determined contributions, without prejudice to the legal nature of the contributions, in the context of adopting a protocol, another legal instrument or an agreed outcome with legal force under the Convention applicable to all Parties” (Decision 1/CP.19).

INDCs, and the term “contribution” in particular, emerged as a compromise between quantified emission limitation and reduction objectives, and nationally appropriate mitigation actions, which respectively refer to Annex I and non-Annex I mitigation actions.[3] The current round of INDC submissions represents the first time that all countries, developed and developing, were obligated to submit emission reduction pledges under the UNFCCC.

The Warsaw decision also requested that the INDCs be communicated “well in advance” of COP 21 in Paris. At COP 20 in Lima, in December 2014, parties further agreed that INDCs should represent a progression beyond current mitigation efforts and prevent backsliding.[4]

Debating the INDCs’ Scope

Initially, delegates disagreed over what the INDCs should contain and whether they would be part of the Paris agreement. In 2013, in Warsaw, the compromise language was intentionally vague regarding whether INDCs were meant to just reference emission reduction targets, or whether they should also include goals related to adaptation and finance. Developed countries argued that INDCs should only contain mitigation targets, while many developing countries said this would lead to a weak Paris agreement, as lack of support would prevent them from submitting ambitious plans.[[5]Developing countries, therefore, insisted that the INDCs, submitted by developed countries in particular, should address means of implementation (finance, technology and capacity-building).

Subsequently, in 2014, in Lima, the COP revisited the issue. Delegates decided that INDCs must include information on emission reductions, invited countries to consider including an adaptation component, and agreed that least developed countries and small island developing States need only communicate information on strategies, plans and actions for low-carbon development (Decision 1/CP.20, or the Lima Call for Climate Action). Developing countries could also indicate needs and priorities, including in relation to finance, technology and capacity building, in order to implement their INDCs, and the level of additional ambition that could be realized with greater support. Countries were provided with a set of guidelines detailing information their INDCs “may include” in order to ensure some level of comparability would exist among the plans,[6] including: a reference point, such as the base year from which emissions will be reduced; time frame; scope and coverage; methodological approach towards calculating emissions; a fairness and ambition component; and how it contributes to achieving the UNFCCC’s objective, as laid out in Article 2 of the Convention.[7]

Mitigation pledges can take the form of: an absolute economy-wide emission limitation or reduction target; intensity targets relative to GDP; peaking of emissions; and deviations from a business-as-usual scenario.[8] With relatively limited information actually required and because the plans are “nationally determined,” countries were afforded a great deal of flexibility in developing their plans. They were able to adopt their own approach based on their unique national circumstances and priorities, in recognition that countries remain at different growth levels and will need to transform their economies under varying conditions.[9]

Illustrating the variety of INDCs submitted, Mexico’s INDC, the first submitted by a developing country, includes a section on adaptation, while the EU’s INDC does not. Switzerland’s pledge of a 50% emission reduction will, in part, use international carbon credits, while the EU, which pledges emission reductions of “at least” a 40%, will carry out all reductions domestically.

As INDCs are the primary conduit through which governments are communicating how they will cut emissions in the post-2020 period, they can form the basis for collective action and, if ambitious enough, can forge a path toward a low-carbon, climate-resilient future. Beyond their international implications, INDC development and implementation can also lead to non-climate domestic benefits, such as sustainable economic development and poverty reduction.[10] INDCs reflect a bottom-up process, and during a 13 October press conference, Janos Pastzor, UN Assistant Secretary-General for Climate Change, explained that INDCs “are a baseline not a ceiling for action.”

Assessing the Ambition of INDCs Submitted to Date

During a 20 October press conference, which was held on the sidelines of the Ad Hoc Working Group on the Durban Platform for Enhanced Action (ADP) meeting in Bonn, Germany, UNFCCC Executive Secretary Christiana Figueres commented that the submission of so many INDCs representing such a large share of emissions represented an “historic, unprecedented effort” and “the first success of Paris,” with in-depth consultations undertaken in each country to come up with such comprehensive plans.[11] She underscored that countries will need to address how to anchor the INDCs in the Paris agreement, which must facilitate a pathway or mechanism for “ratcheting up” commitments.[12]

While the number of INDCs submitted thus far is certainly promising, as of 10 November, a number of important OPEC countries and big emitters had yet to submit their action plans. Some, including Nigeria and Iran, have indicated they will submit their INDCs before Paris.[13] On 22 October, the United Arab Emirates became the third OPEC member, after Algeria and Ecuador, to submit a plan, pledging to raise the share of nuclear and renewables in its energy mix to 24% by 2021 from 0.2% in 2014.[14] On 10 November, Saudi Arabia submitted its INDC, which seeks to achieve mitigation co-benefits of up to 130 million tons of CO2eq by 2030 annually through economic diversification and adaptation.[15] Many have said it is encouraging that even the top oil producing countries will get on board before Paris, allaying the fears of some who felt that these countries might not want to be a part of an agreement that “threatens” fossil fuel use.[16]

Multiple analyses of the INDCs submitted thus far have been published in the lead up to Paris. They assess the aggregate effect of the INDCs, in particular if they are ambitious enough to achieve the long-term global goal of maintaining temperature rise to below 2°C compared to pre-industrial levels. A number of such analyses find that, if fully implemented, the INDCs have the potential to limit temperature rise to around 2.7°C by 2100, falling short of the 2°C goal. These include a synthesis report produced by the UNFCCC Secretariat on the aggregate impact of submitted INDCs[17] and an International Energy Agency (IEA) report.[18] For their part, the latest edition of the UNEP Emissions Gap Report,[19] a review by the European Union’s Joint Research Centre[20] and a report published by a number of civil society groups[21] conclude that implementation of the INDCs would still result in a temperature rise of around 3°C by 2100.

The UNFCCC synthesis report, which was mandated by COP 20, analyzes the 119 INDCs covering 147 parties (with the EU and its 28 member states counting as one) that were submitted by 1 October 2015, including all industrialized countries and 75% of all UNFCCC parties, representing 86% of global emissions.[22] It finds that, if fully implemented, the INDCs have the potential to: put global emission levels at approximately 55 carbon dioxide equivalent per year (GtCO2eq) in 2015 and 57 GtCO2eq in 2030; result in an 8% decline in per capita emission intensity by 2025 and 9% by 2030, compared to 1990 levels; and lead to an emissions growth rate over the 2010-2030 period that will be one-third lower than in the 1990-2010 period. Given that not all parties had communicated an INDC by 1 October 2015, and that not all INDCs cover all gases and sectors, the estimated aggregate emissions level covered is a subset of total global emissions.[23]

Approximately 100 of the INDCs contain an adaptation component, with the water resources, agriculture, health, ecosystems and forestry sectors registering the highest concern. Most provided information on means of implementation required to support adaptation actions, with some parties quantifying financial adaptation needs, ranging from US$100 million to over US$200 billion for the whole INDC period to around US$10 million to US$3 billion per year. A few parties provided projected adaptation costs for different mitigation scenarios, thus reaffirming that adaptation needs depend on mitigation ambition. Most parties indicated either a five- or ten-year implementation period for their INDCs, with some including a longer-term vision for low-emission development.

The report explains that some of the INDCs include an unconditional mitigation component along with a conditional one, dependent on the provision of means of implementation, and provide quantitative estimates of support required for implementation and for achieving the upper level of their mitigation contributions. Some identified domestic measures to support implementation, such as market-based mechanisms, increased budgetary support, public-private partnerships, green procurement programmes, pricing and taxation regimes reform, or the improvement of green credit mechanisms.

According to the UNFCCC report, many of the INDCs cover most or all of the Intergovernmental Panel on Climate Change sectors, including energy, industrial processes and product use, agriculture, land use, land-use change and forestry (LULUCF) and waste, with most parties including LULUCF emissions and removals. In addition, most cover CO2, many cover methane (CH4) and nitrous oxide (N2O) emissions, some cover emissions of sulphur hexafluoride (SF6), hydrofluorocarbons (HFCs), perfluorocarbons (PFCs) and nitrogen trifluoride (NF3), and a few include additional gases, such as short-lived climate forcers. The report explains that some parties expect that negotiations under the ADP will provide clarity for meeting some of the conditions, while a few reserved the right to revise their INDCs based on the outcome of the ADP process.

The IEA report, in its assessment of INDCs, concluded that: if all countries meet the goals outlined in their contributions, growth in energy-related emissions (or two-thirds of total emissions) will either plateau or be in decline by 2030.[24] In the report, titled ‘World Energy Report Special Briefing for COP 21,’ the IEA estimates that implementing pledges will require the energy sector to invest US$13.5 trillion in energy efficiency and low-carbon technologies from 2015 to 2030, or an annual average of US$840 billion. IEA Executive Director Fatih Birol stressed that the energy industry needs a “strong and clear signal” from Paris, or energy investments will be “pushed in the wrong direction, locking-in unsustainable energy infrastructure for decades.” Birol added that the fact that so many countries have submitted pledges to reduce emissions is “remarkable,” and that all INDCs submitted thus far take into account energy sector emissions, with many including targets or actions to address them, thus “breaking the link between rising electricity demand and rising related CO2 emissions.”[25]

UNEP also addressed the issue in the sixth edition of its Emissions Gap Report,[26] concluding that the INDCs represent emission reductions of 4 to 6 gigatonnes of GtCO2eq/yr in 2030 compared to projected emissions under current policy trajectories. According to the report, even if all INDCs are fully implemented, the 2030 emissions gap would still be 12 GtCO2eq. While this scenario assumes that countries will not further accelerate efforts in subsequent years, Paris is expected to discuss and elaborate on ways in which countries will be able to accelerate their efforts in the future. The challenge, according to the report, is to “bend the emissions trajectory down as soon as possible” to ensure that the net zero emissions goal in 2060-2075 is within reach.[27] The Report also acknowledges that preparing the INDCs has led to the exploration of links between development and climate, and the development of new national climate polices, which may be “considered as the first step in a transition towards low-carbon economies.” The report is optimistic in stating that the Paris agreement can still encourage further action to achieve the 2°C goal, namely through adopting a flexible and dynamic approach in which ambition and climate finance can be “adjusted upwards at regular intervals.”[28]

For their part, many civil society organizations are calling for transforming the INDCs into legally-binding mitigation commitments under the 2015 agreement, whereby the contributions would no longer be “intended.” A number of civil society groups, including social movements, environmental and development NGOs, trade unions and faith groups, published a report analyzing whether the INDCs submitted are sufficient to address climate change and whether each country was doing its “fair share” in its contribution. The report, ‘Fair Shares: A civil society equity review of INDCs,’[29] found that: current INDCs represent less than half of the emission reductions required by 2030; and the ambition of major developed countries, including the Russian Federation, Japan, the US and the European Union, fall well short of their “fair shares,” while the majority of developing countries have made mitigation pledges that exceed or broadly meet their fair share. [30]

According to civil society organizations, a country’s fair share depends on its historical responsibility, and its capacity to take climate action, using national income over and above what is needed to provide basic living standards.[31] The report argues that: countries have thus far been allowed to determine their own targets on a purely national basis without taking into account the scale of the global effort required or what is “fair”; high emitting countries will have to do more to close the emissions gap, and this can be done in a fair way; and the Paris Agreement must provide a framework where governments set equitable targets based on what the science says is required.[32]

Implications of INDCs on the Road to Paris and Beyond

So what does all this mean for the Paris Climate Change Conference? And what role will the INDCs play in the new agreement? Clearly, more needs to be done. Many of the pledges made in the INDCs do not go beyond 2030, and most assessments of all submitted INDCs agree that they will “fall short” of reaching the 2°C target, even if fully implemented.

Thus, the Paris Climate Change Conference must establish and incorporate within the expected agreement a manner by which ambition can be ramped up in the future. Various options for how this might be done are contained in the current draft text of the Paris outcome,[33] which is precisely how the INDCs are likely to be incorporated into or anchored in the agreement. While it still remains uncertain whether the contributions and targets submitted by countries will in themselves be legally binding, the mechanism parties will put in place to increase ambition over time will likely take on an element of legal force.

How often INDCs are updated will be a key issue in Paris, with various options still on the table, ranging from “every five years for all parties,” to different cycles for developed and developing countries, and potential indicative targets on top of absolute goals. Many expect some sort of “ratchet mechanism” to ensure that the Paris agreement is “durable and relevant” over the long term, and countries are able to “augment” the contributions already offered with a process to promote post-Paris actions.[34] Thus, negotiators and observers are increasingly calling for a flexible deal, where pledges can be increased without changing the agreement itself. One issue on which most agree is that the debate on how and when countries will revisit their pledges will extend into the wee hours of the last day of the Paris Climate Change Conference.

This policy update was edited by Alice Bisiaux LL.M, Lynn Wagner Ph.D, and Beate Antonich.

[6] Decision 1/CP.20, para. 14
[7] Article 2 states that the Convention aims to stabilize greenhouse gas concentrations in the atmosphere at a level that would prevent dangerous anthropogenic interference with the climate system.

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