COP26 has come and gone, leaving many of us to pick through the flurry of activities and sideline deals in an attempt to make sense of the plethora of outcomes. For most readers the $8.5bn SA Just Energy Transition deal will be grabbing the limelight, but for people like myself who are active in the carbon markets, seeing the article 6 carbon market component of the Paris Agreement reach a successful resolution after six years of impasse is an enormous relief.
Quite a few features of the new article 6.4 carbon mechanism must still be ironed out, particularly around the potential for a split into a two-tier market of “adjusted credits” and “nonadjusted credits”, but the initial progress is promising.
Adjusted credits are credits that result in changes in country-level greenhouse gas inventories when a carbon credit is transferred across borders to avoid double-counting. This is of particular importance in the developing world context, where opportunities for nature-based solutions abound and where adaptation finance is thin on the ground.
Of particular concern to me is the apparent persistent lack of awareness from senior SA officials and policymakers about how adaptation finance can play out practically, and just how important it is to wake up and smell the coffee.
In the build-up to COP26 forestry, fisheries and environmental affairs minister Barbara Creecy said “we need to increase the adaptive ability and resilience of the global population to the adverse impacts of climate change by at least 50% by 2030 and by at least 90% by 2050”.
“In this regard, the focus would be placed on the most vulnerable people and communities in terms of food and water security; infrastructure and the built environment; and ecosystems and ecosystem services, particularly in Africa, small island developing states and least developed countries.”
Certainly, it is true that the impact climate change is set to make will be felt most heavily by the marginalised in our society, particularly in rural areas, but as any resident of Cape Town, Gqeberha, or most recently Johannesburg, can attest, water scarcity affects urbanites too.
After Cape Town’s brush with Day Zero in 2018 the Western Cape government commissioned a study into “the economic risks and opportunities of climate change and climate resilience in the Western Cape”. The report found that by investing in improved climate resilience the Western Cape economy could be 33% better off in 2040 than if the province does not adapt effectively to the effects of climate change.
A subsequent cost-benefit analysis comparing options yielding water supply gain and unit cost comparisons found that catchment restoration is by far the leading option with respect to value for money.
So when my esteemed former colleague, lead negotiator to COP26 Maesela Kekana, went on record last week saying, “You can’t make money from adaptation. Mitigation — you put a renewable energy power plant, sell to Eskom, you make money, hence the investment into mitigation. But adaptation ... nobody is going to make money out of that,” I got very worried indeed. Policymakers have got to lift their gaze and see some of the great strides being made by actors on the ground.
As such it was a pleasure to see Candice Stevens, chair of the Sustainable Landscape Finance Coalition, walk away with the Mail & Guardian Green Finance prize in its Greening the Future Awards last week. The innovative approach being piloted by the coalition layers state subsidies and tax breaks, enterprise and supplier development funding, property rebates, carbon and biodiversity offset revenues and debt instruments, among other finance streams, to deliver investable climate adaptation programmes.
Already in its first year of operation, the programme is introducing $83m in new finance to SA’s protected areas and has garnered international recognition. We need more of this.
• Maguire holds a master’s degree in global change studies from Wits and has been developing green economy solutions for the private sector, NGOs and the state for more than a decade.
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