Informing transparency in the Paris Agreement: the role of economic models

Abstract:

Establishing a credible and effective transparency regime to support the Paris Agreement – broader than its formal ‘transparency framework’ – will be both crucial and challenging. The Agreement provides for review of achievements under national pledges (Nationally Determined Contributions, or NDCs), but much of this information will become available only well after key steps in the launch of this latest attempt to control human influence on the climate. Still, in these early years, information and understanding of individual and collective performance, and of relative national burdens under the NDCs, will play an important role in the success or failure of the Agreement. However, because of the phasing of various steps in the 5-year cycles under the Agreement and the unavoidable delays of two or more years to produce and review government reports, the Climate Convention and other intergovernmental institutions are ill-suited to carry out timely analyses of progress. Consequently, in advance of formal procedures, academic and other non-governmental groups are going to provide analyses based on available data and their own methodologies. The article explores this transparency challenge – using the MIT Economic Projection and Policy Analysis (EPPA) model to construct sample analyses – and considers ways that efforts outside official channels can contribute to the success of the Agreement.

Key policy insights:

• Because key national decisions are faced before full implementation of the transparency framework, being negotiated by the Ad-Hoc Working Group on the Paris Agreement (APA), urgent attention is needed to activities supporting the regime’s system of pledge and review.

• Outcomes of these APA negotiations, explored here, including features of reported NDCs and guidelines for tracking progress, will influence the effectiveness of the Agreement in encouraging greater mitigation effort.

• Whatever the outcome of the APA negotiations, studies by academic and other non-governmental analysis groups will in the near term have a particularly great influence on the transparency objectives of the Agreement.

• Challenges to the provision by these groups of clear, coherent, credible analyses are explored, leading to recommendations for improved documentation of methods and standards of practice in analysis.