Strengthening International Climate Governance: The Case for a Sectoral Approach
In order to achieve the Paris Agreement objectives, and quicken the decarbonisation process that is urgently needed of our societies and economies, the simultaneous transformation of a wide range of sectoral systems is required. However, each of these systems face very specific transformation challenges and are highly interdependent on one another.
Sectoral Decarbonisation Challenges
There is significant potential for international governance to help accelerate this climate transition. This calls for tailor-made sectoral approaches, including an increased number of multi-stakeholder initiatives. More encompassing sectoral governance can strengthen countries’ “nationally determined contributions” (NDCs), which is much needed for improving the pathway to a speedy decarbonisation.
Economic, technical and political transformation challenges vary significantly both across and within sectoral systems. Barriers vary across sectors but all are often shaped due to technological and social process, and also evolve over time. As a result, sectors each possess unique transformation challenges.
International Governance Institutions: Five Functions
Just as the challenges vary, so does the potential contribution of and demand. As identified in a new report, five core functions have been pinpointed that international governance can fulfil.
Firstly, demand for guidance and signalling at the international level is generally high across different sectoral systems, as internationally agreed sectoral targets and visions for different sectors can align actors globally.
While overarching targets (such as those enshrined in Articles 2 and 4 of the Paris Agreement) may provide general guidance, specific sectoral decarbonisation targets and visions will provide more concrete guidance to actors and help minimise any potential shirking of responsibilities among the different sectors.
International rules can help advance decarbonisation efforts by addressing concerns of competitiveness, developing a common international-scale approach for regulating transboundary activities, and facilitating cooperative approaches or pushing national governments into action (with appropriate support).
A range of relevant regulations can be considered, from labelling over technical standards to market instruments, such as carbon pricing to phase-out obligations. It is also important to keep in mind that different components within each sectoral system changes frequently, which impacts the potentials of different international regulations.
There is also strong demand for ensuring transparency and accountability, particularly where international competition and interdependence provide a strong motivation for free-riding, creating a call for checks on the implementation of international rules.
In contrast, this demand for international regulation can be weakened if: (1) demand that would require implementation is low in the first place (e.g. waste, urban systems, appliances); (2) it does not focus primarily on a competitiveness rationale, but instead is aimed to enable climate action (e.g. technical standards for electric vehicles); or (3) the regulated activities are intrinsically quite transparent (e.g. extractive industries and transport).
The demand for adequate means of implementation (finance, technology and capacity building) for advancing the transformation is relatively high overall. However, significant variations exist in the details, particularly when comparing the type and specific form of support required by each sector.
In some sectors, technology diffusion may be a prominent challenge, while in others, technology transfer bigger issue. For several sectors, various forms of capacity building are in high demand and in most sectoral systems, direct financing or access to finance and investment is much needed. In some cases, there is also particular demand for spreading and sharing investment risks through international cooperation.
Finally, there is also some level of demand for internationally coordinated knowledge and learning across sectoral systems. For some sectors, where technological alternatives and effective policies are relatively well established, this need is small. For others, these cooperation processes can advance technology development, and improve the design of effective policies and/or awareness raising significantly. In some sectors, technology development and research coordination appear crucial.
In general, there is more or less potential for promoting technical and/or policy learning across multiple countries and jurisdictions.
Pathways to Strengthening Sectoral Approaches
These specific functions provide a strong rationale for strengthening sector-specific approaches in international climate governance, in order to advance the climate transition. Sectoral systems face unique challenges, which vary in terms of promise and potential from international climate governance. Consequently, the specific demand for and potential added value of international governance widely varies across, and even within, sectors.
However, even with this evidence, sectoral approaches have not been comprehensively developed within international climate governance. While discussions on international climate governance have broadened beyond the multilateral UN Framework Convention on Climate Change (UNFCCC) in the 2000s, the pursuit of an overarching approach under the Paris Agreement lacks sector-specific elements.
Hence there is significant potential for the European Union and other prominent and interested actors to promote meaningful sectoral international climate governance more systematically, both within the legal architecture of the Paris Agreement and through other sectoral governance institutions beyond the UNFCCC. More specifically, we see the following promising avenues that might be pursued to this end:
- Sectoral perspectives could be strengthened in the 2018 Facilitative “Talanoa” Dialogue and the subsequent five-yearly Global Stocktake.
- Parties should be encouraged to explicitly address sectoral specific transformation challenges (in the elaboration of their medium and long-term climate plans).
- Inter- and transnational governance initiatives should be decidedly better orchestrated by sector.
As a result, the capacity of international climate governance to address the specific challenges and potentials of different sectoral systems should be improved considerable. Advancing the sectoral dimension of in this way can be a crucial key to accelerating the world’s transformation towards full decarbonisation.
Sebastian Oberthür is Professor for Environment and Sustainable Development at the Institute for European Studies at the Vrije Universiteit Brussel (IES-VUB).
Lukas Hermwille is a Research Fellow at the Wuppertal Institute for Climate, Environment and Energy.
Gauri Khandekar is a Researcher at the Institute for European Studies at the Vrije Universiteit Brussel (IES-VUB).
Wolfgang Obergassel is Project Co-Ordinator at the Wuppertal Institute for Climate, Environment and Energy.
Note: This blog is based on the COP21 RIPPLES working paper:
Sebastian Oberthür et al., Key concepts, core challenges and governance functions of international climate governance, Deliverable 4.1, COP21 RIPPLES – COP21: Results and Implications for Pathways and Policies for Low Emissions European Societies, Horizon 2020, September 2017, available for download at: https://cop21ripples.climatestrategies.org/resources/.