Climate change and energy transition are re-shaping the extractive sectors, and the opportunities and risks they present for governments, companies and civil society. As the central governance standard in the extractives sector, the EITI has a critical role in supporting transparency in producer countries.

This workshop will bring together experts from the energy and extractives sectors, governance and transparency, and climate risk and financial disclosure initiatives to discuss the role of governance and transparency through the transition. It will consider the appropriate role for the EITI and potential entry points for policy and practice, and the potential for coordination with related transparency and disclosure initiatives. 

Please note attendance is by invitation only.

The UK will host the 26th Conference of the Parties (COP26) in November 2020 in Glasgow. In the run up, Chatham House is organizing a monthly briefing series targeted to:

• The diplomatic service based in London, in particular, staff of the London embassies who are reporting on climate change issues.
• Senior UK government civil servants, officials and politicians engaged in climate change.
• Academics, experts, business representatives and NGOs.

The first briefing in the series focuses on the results from COP25 held in Madrid in December 2019 and what this means for 2020.

This briefings series offer an opportunity to discuss, in an informal setting, the most pressing and complex climate issues of the day with UK and international government officials and experts.

Mass human displacement crises like those in Syria, Democratic Republic of Congo and Myanmar do not dissipate within a year or two. The average age of a refugee camp globally is 18 and counting.

Meanwhile, the pressures on resources and services in neighbouring countries absorbing an influx of vulnerable people can be harsh. Imagine the overstressed schools and hospitals where intake has doubled in areas of Jordan and Lebanon, and the damage to ecosystems and elephant habitats where camps have sprung up in Bangladesh. 

The fallout from such crises is prompting new ways of working in the international humanitarian system. These recognize that short-term, emergency responses can jeopardize national development goals if maintained indefinitely. In most refugee camps for instance, each family cooks with wood in regions already suffering from deforestation.

Reliance on polluting trucks to bring in fuel and water is high. At the same time, developing countries – which host 80 per cent of the record 70.8 million people currently displaced by conflict – desperately need to address health, water, energy and housing needs for their own populations. Aid and welfare interventions directed only at refugees can provoke frustrations amongst the local community, damaging social cohesion and fostering political instability. 

The Global Compact on Refugees, affirmed by the United Nations General Assembly one year ago, aims at fairer responsibility-sharing amongst countries and equitable resourcing to host communities and refugees. The Global Refugee Forum (GRF) taking place 17–18 December in Geneva is the starting point for donor pledges and commitments. 

An opportunity for refugee-hosting countries

Among the GRF’s 6 focus themes is ‘Energy and Infrastructure’ – a new priority for humanitarian aid and finance. This covers energy, environment, water and sanitation, health, shelter and connectivity – services that are tightly interconnected. In October, the UN Refugee Agency (UNHCR) also launched its first energy strategy, which ‘promotes the transition to clean, renewable energy at refugee camps and hosting sites’.

Given this impetus, alongside a growing international focus on speeding up Sustainable Development Goal (SDG) delivery, stabilizing migration and supporting climate resilience, more aid and soft credit for interlinked objectives will become available. Countries hosting refugees have an opportunity; how they approach it will determine the level of support they attract and how effectively it is deployed. 

Policy conditions are key to success

In a refugee situation, energy access is about much more than keeping warm or cooking food. It is also about connecting with loved ones across borders, safety at night, healthy births and making a living. Due to the lack of long-term funding, maintenance systems or government approvals, failed pilots to introduce for example, solar streetlighting or clean cookstoves, are the norm. 

To increase their durability and reach, projects need to harness local markets and support national development goals, especially those on access to modern energy for all (SDG 7), protecting ecosystems (SDG 15) and resilient human settlements (SDG 11). Several examples of these are emerging, each with valuable lessons to share. 

The policy environment, in particular, coordination between authorities, humanitarian agencies and private sector actors, can make or break a project. Beyond the basic conditions of adequate security and refugee acceptance, our research highlights three enabling factors:

First: government willingness to engage in long-term response and resilience coordination. Jordan is the most advanced in this with its three-year rolling Response Plan for the Syria Crisis whereby the government works with humanitarian agencies to integrate refugee welfare with national development needs.

Here, energy, water and housing needs are specified and have attracted funding. For example, in Irbid, Jordan where over 137,600 Syrian refugees live, the Norwegian Refugee Council, is expanding a programme under the Renewable Energy for Refugees (RE4R) initiative that applies energy efficiency and solar water heating to reduce bills and rents for refugee tenants while adding value for Jordanian homeowners.   

Second: strong, clear, energy and environment plans and legislation. Signals can be mixed. Jordan’s ‘wheeling’ regulation, allowed UNHCR to reduce its electricity bills through specially built solar plants at Azraq and Zaatari, yet the current freeze on renewable connections has stifled further projects.

In Rwanda,  the government banned the supply of woodfuel to refugee camps on the basis of concerns about deforestation. The announcement sharpens focus on cleaner cooking.

Yet with little guidance on enforcement and the timeframe for change, it is difficult for UNHCR and its partners to plan viable schemes. A reversion to stove and fuel handouts is likely, damaging the potential to create markets for alternative cooking practices in the camps. 

Third: local fuel prices. Where polluting fuels are subsidized or untaxed, additional subsidy is needed to make cleaner alternatives competitive. The higher prices of diesel in Uganda for example are an incentive for solar projects at Bidi Bidi, the world’s largest refugee settlement.

The Gaia Association-UNHCR clean energy programme in Ethiopia’s Western refugee camps has avoided burning some 10,000 tonnes of wood since 2006 through ethanol, but if  VAT (which is applied to neither charcoal nor kerosene) were waived, it could scale up commercially. 

Joining up the dots

Many humanitarian and government dots could be joined up in support of the SDGs. In Rwanda for example, clarity on electrification plans – which appear to cover refugee areas – could allow camp mini-grids to be designed for eventual grid integration. In Jordan, lessons learned from the home upgrading programme could be applied to meet city climate resilience ambitions. 

Donors at the GRF should support humanitarian operations that leave a positive legacy, increasing the robustness of country infrastructure and systems. Host-country governments should help define and encourage projects that benefit national and refugee populations. This will be critical to both development outcomes and limiting future human suffering. 

December’s UN climate talks held in Madrid were aptly titled ‘Time for Action’. While little progress was made at the conference in establishing an international framework that would help to instigate this, there is still much scope for action in 2020. The need for this has become all too apparent as the impacts of climate change are increasingly seen around the world.

One of the key areas where progress can be made in 2020 is in increasing the ambition of nationally determined contributions (NDCs), these being governments’ plans to take action in response to climate change. To date, 184 countries have submitted NDCs, yet the commitments that have been made fall far short of what is needed to avert catastrophic climate change.

In 2020, however, many countries will be revising their NDCs, presenting an important opportunity to shift momentum; to date 79 countries have announced that they will be enhancing the ambition of their NDCs.

The forest sector is one area where more ambitious targets are likely to be set, and indeed, at the Climate Action Summit in September 2019, more than 20 countries made new commitments for the conservation, reforestation and restoration of their forests.

This will be essential. As is well documented, reducing deforestation is critical to reducing carbon emissions, while healthy and diverse forests are vital for adapting and increasing resilience to climate change.

However, while it is important that ambitious targets are set, this is relatively easy; the bigger challenge lies in ensuring that these are achievable.

This is all too apparent from experience thus far. In 2014, the New York Declaration on Forests set the goal to halve forest loss by 2020, and to end it by 2030. In addition, it included the goal to restore 150 million hectares of degraded landscapes and forestlands by 2020, and a further 200 million hectares by 2030.

The declaration has been endorsed by over 50 countries, as well as business and civil society organizations, yet the 2020 goals are far from being reached – in the six years since the declaration was launched, it has been found that forest loss increased rather than declined, and only about 27 million hectares of land have been restored.

What then is needed to ensure that the commitments being made by governments in their NDCs will actually be met? Three big changes are required.

Firstly, a shift in perspective is needed in many countries to a more forest-sensitive approach to development, one that gives adequate recognition to the full range of values provided by forests, rather than primarily focusing on their role as a global carbon sink. These include their importance for local and national economies, for livelihoods and the well-being of forest-dependent peoples, and for biodiversity and the regulation of local climate and water systems.

The focus on nature-based solutions at the international level offers potential to support this shift. However, it is critical that these are not seen as ‘niche’ approaches, and that countries identify what nature-based solutions mean for them, and how forests and tree-rich landscapes can best be integrated into their development strategies.

Fundamental to achieving this will be further improvements in governance, and this is the second change that is required. Legal and institutional reforms are needed in many countries as well as significant investments in human and technical resources. This will enable processes to be strengthened, or put in place, so that equitable strategies can be developed and implemented – strategies that reflect a balance of the needs and priorities of the full range of stakeholders, including local and global, rural and urban, women and men, young and old.

Financing will of course be critical for this, and the least developed countries in particular will be hindered in the actions they can take without additional finance. This is the third area of change that is needed, and it is to be hoped that the international community will make better progress on this in 2020. Forest and land-use options are often described as a cost-effective means of tackling climate change, as is noted in the Santiago Call for Action on Forests for example.

This is not to say that these will be easy or cheap – as Chatham House has documented, experience of forest governance reform has shown that it takes significant funding and time to bring about deep-rooted change. However, the huge potential benefits that can result, for the citizens of forest-rich countries as well as for the planet, mean that forests and sustainable land-use are a good investment.

This project will be led by Practical Action and UNHCR and will deliver renewable energy investments through an innovative approach in humanitarian settings, working directly with refugees and host communities in Kigeme, Nyabiheke and Gihembe refugee camps in Rwanda and with urban refugees in Irbid in Jordan.

The project will provide access to affordable and sustainable sources of renewable energy, and improve the health, wellbeing and security of target populations.

As part of this programme, Chatham House will work on a series of research activities and outputs that look to disseminate and scale up the lessons-learnt and evidence-generated by the programme.

Access more of Chatham House's work on humanitarian energy through our Moving Energy Initiative microsite.

The 30th Global Forum on Forest Governance will take place remotely online on 13-14th July 2020. Online registration, with further details, will follow in due course.

As the UK leaves the EU and the formal negotiations on the future relationship begins, this workshop will discuss any immediate changes and review the short and medium term impacts of Brexit on the energy sector. 

The workshop will look to cover:

• The implications for UK business and system operations of the UK leaving the Internal Energy Market.
• Current and future investment trends in the UK energy system.
• The trade of electricity and gas over inter-connectors.
• The need for the development of a new EU-UK operational framework mechanism.
• The UK's EU withdrawal agreement and the operation of the Single Electricity Market (SEM) across Ireland. 
• Options for the UK outside of the EU Emissions Trading System (ETS) and the impact on carbon prices.

This workshop is part of a programme funded by the UK Energy Research Centre on Brexit and the UK’s Net Zero Energy Policy being run by the University of Warwick and Chatham House.

Attendance at this event is by invitation only.

This meeting formed part of a programme of work which investigates the role of negative emissions technologies (NETs) in achieving the Paris Agreement climate targets. Previous meetings held in London and Brussels have looked at integrating negative emissions into EU policy-making, the implications and degree to which NETs, and in particular bioenergy with carbon capture storage (BECCS), can be an effective climate mitigation tool. This meeting focused on the possible deployment pathways of NETs and alternatives to BECCS for the US in particular, in the context of geographical constraints and socioenvironmental implications, the role of the private sector, and appropriate governance and finance mechanisms. 

The world is currently witnessing how vulnerable existing production and consumption systems are, with the current global health crisis harshly exposing the magnitude of the risks associated with the global economy in its current form, grounded, as it is, in a linear system that uses a ‘take–make–throw away’ approach.

These ‘linear risks’ associated with the existing global supply chain system are extremely high for national economies overly dependent on natural resource extraction and exports of commodities like minerals and metals. Equally vulnerable are countries with large manufacturing sectors of ready-made garments and non-repairable consumer goods for western markets. Furthermore, workers and communities working in these sectors are vulnerable to these changes as a result of disruptive technologies and reduced demand.

In a recently published Chatham House research paper, ‘Promoting a Just Transition to an Inclusive Circular Economy’, we highlight why a circular economy approach presents the world with a solution to old and new global risks – from marine plastic pollution to climate change and resource scarcity.

Taking the long view

So far, action to transition to a circular economy has been slow compared to the current crisis which has mobilized rapid global action. For proponents of transitioning to a circular economy, this requires taking the long view. The pandemic has shown us that global emergencies can fast-forward processes that otherwise might take years, even decades, to play out or reverse achievements which have taken years to accomplish.

In this vein, there are three striking points of convergence between the COVID-19 pandemic and the need to transition to an inclusive circular economy.

Firstly, the current crisis is a stark reminder that the circular economy is not only necessary to ensure long-term resource security but also short-term supplies of important materials. In many cities across the US, the UK and Europe, councils have suspended recycling to focus on essential waste collection services. The UK Recycling Association, for example, has warned about carboard shortages due to disrupted recycling operations with possible shortages for food and medicine packaging on the horizon.

Similarly, in China, most recycling sites were shut during the country’s lockdown presenting implications for global recycling markets with additional concerns that there will be a fibre shortage across Europe and possibly around the world.

Furthermore, worldwide COVID-19 lockdowns are resulting in a resurgence in the use of single-use packaging creating a new wave of plastic waste especially from food deliveries – already seen in China – with illegal waste fly-tipping dramatically increasing in the UK since the lockdown.

In this vein, concerns over the current global health crisis is reversing previous positive trends where many cities had established recycling schemes and companies and consumers had switched to reusable alternatives.

Secondly, the need to improve the working conditions of the people working in the informal circular economy, such as waste pickers and recyclers, is imperative. Many waste materials and recyclables that are being handled and collected may be contaminated as a result of being mixed with medical waste.

Now, more than ever, key workers in waste management, collection and recycling require personal protective equipment and social protection to ensure their safety as well as the continuation of essential waste collection so as not to increase the potential for new risks associated with additional infectious diseases.

In India, almost 450 million workers including construction workers, street vendors and landless agricultural labourers, work in the informal sector. In the current climate, the poorest who are unable to work pose a great risk to the Indian economy which could find itself having to shut down.

Moreover, many informal workers live in make-shift settlements areas such as Asia’s largest slum, Dharavi in Mumbai, where health authorities are now facing serious challenges to contain the spread of the disease. Lack of access to handwashing and sanitation facilities, however, further increase these risks but circular, decentralized solutions could make important contributions to sustainable sanitation, health and improved community resilience.

Thirdly, it is anticipated that in the long term several global supply chains will be radically changed as a result of transformed demand patterns and the increase in circular practices such as urban mining for the recovery and recycling of metals or the reuse and recycling of textile fibres and localized additive manufacturing (e.g. 3D printing).

Many of these supply chains and trade flows have now been already severely disrupted due to the COVID-19 pandemic. For example, the global garment industry has been particularly hard-hit due to the closure of outlets amid falling demand for apparel.

It is important to note, workers at the bottom of these garment supply chains are among the most vulnerable and most affected by the crisis as global fashion brands, for example, have been cancelling orders – in the order of $6 billion in the case of Bangladesh alone. Only after intense negotiations are some brands assuming financial responsibility in the form of compensation wage funds to help suppliers in Myanmar, Cambodia and Bangladesh to pay workers during the ongoing crisis.

In addition, the current pandemic is damaging demand for raw materials thereby affecting mining countries. Demand for Africa’s commodities in China, for example, has declined significantly, with the impact on African economies expected to be serious, with 15 per cent of the world’s copper and 20 per cent of the world’s zinc mines currently going offline. 

A further threat is expected to come from falling commodity prices as a result of the curtailment of manufacturing activity in China particularly for crude oil, copper, iron ore and other industrial commodities which, in these cases, will have direct impacts on the Australian and Canadian mining sectors.

This is all being compounded by an associated decline in consumer demand worldwide. For example, many South African mining companies – leading producers of metals and minerals – have started closing their mining operations following the government’s announcement of a lockdown in order to prevent the transmission of the virus among miners who often work in confined spaces and in close proximity with one another. As workers are laid off due to COVID-19, there are indications that the mining industry will see fast-tracking towards automated mining operations. 

All of these linear risks that have been exposed through the COVID-19 pandemic reinforce the need for a just transition to a circular economy. But while the reduction in the consumption of resources is necessary to achieve sustainability, the social impacts on low- and middle- income countries and their workers requires international support mechanisms.

In addition, the current situation also highlights the need to find a new approach to globalized retail chains and a balance between local and global trade based on international cooperation across global value chains rather than implementation of trade protectionist measures.

In this vein, all of the recovery plans from the global COVID-19 pandemic need to be aligned with the principles of an inclusive circular economy in order to ensure both short-term and long-term resilience and preparedness for future challenges and disruptions.  

Avoiding the worst economic, social and environmental risks of climate change requires a better understanding of what those risks may be. Decision-makers need information on the full range of risks that climate change poses, across the full spectrum of probabilities. Monitoring the nature and severity of these risks is essential if decision-makers are to make the right choices about effective mitigation and adaptation responses.

To meet this need, international scientists and policy analysts in the UK (including at Chatham House) and China have been engaged in a multi-year, multi-disciplinary, and collaborative research process. This has deepened understandings of how these complex, interconnected first, second and third-order risks can be better assessed and tracked.

Phase one, culminating in 2015 and involving experts, demonstrated how general principles of risk assessment could be applied in relation to climate change.

Phase two (culminating in 2019) was a bilateral cooperation between the UK and China that was agreed during President Xi Jinping’s state visit to the UK in 2015. It addressed a specific recommendation from phase one - that risk assessments need to be made on a regular and consistent basis - by providing a proof of concept indicator framework.

Substantive project funding for phases 1 and 2 was provided by the UK Foreign and Commonwealth Office, with additional contributions and in-kind support from the China Expert Panel on Climate Change, the UK Government Office for Science, the Skoll Global Threats Fund, the Global Challenges Foundation, the UK Institute and Faculty of Actuaries, and Willis Research Network (phase 1); and Chatham House, China Expert Panel on Climate Change, UK Committee on Climate Change, International Energy Agency, Willis Towers Watson (phase 2).

Many institutions contributed to the project under phases 1 and 2 (see reports for full list of contributors).

• Phase 1 report, 2015: Climate Change: A Risk Assessment
• Phase 2 report, 2018: Developing Indicators of Climate Risk

Chatham House now leads a third phase of this project (2020 to 2022), funded by the Prosperity Fund of the UK Foreign and Commonwealth Office. The purpose is to help ensure emissions reduction and resilience strategies, policies and decision-making - both in China and globally - are better informed by an evidence-based perspective on climate-change risks.

Under the guidance of the China Expert Committee on Climate Change and the UK Committee on Climate Change, the programme is building on the risk indicator and risk assessment work developed in Phase 1 and 2.

This phase of work has four complementary workstreams looking at emissions risks, direct climate risks, systemic climate risks and the integration of climate risks into Chinese and international governance frameworks. Embedded throughout the project is considerations of gender and inclusion（G&I) which are fundamental to achieve climate-compatible development.

The programme is delivered through a cohort of partner organisations based in both China and the UK, including Chatham House, E3G (Third Generation Environmentalism), Hubei University of Economics, National Climate Centre of China, Tsinghua University and the University of Reading.

Finance plays a key role in enabling climate change mitigation and adaptation. It is also a contested issue in the UN climate negotiations. The fourth event in the Chatham House COP26 Diplomatic Briefing Series will explore the politics of climate finance in the context of the COP, and provide a comprehensive update of the main climate finance-related negotiation items and processes. The topic is particularly timely given that the UK Government has made climate finance one of its top thematic priorities for COP26 and that 2020 constitutes the deadline for developed countries to mobilise USD 100 billion per year to support climate action in developing countries.