Climate change and the EITI

Looking out through my office window here in Oslo, I see the security measures going up around the Nobel Peace Centre and the Town Hall ahead of the ceremonies honouring President Obama. Just opposite the City Hall, Greenpeace has moored one of their ships, getting ready for some campaigning and with a reminder on one of their banners to the President that the next stop is Copenhagen. With the COP15 summit starting in Copenhagen, climate change is clearly currently the dominant issue on the global agenda for many governments, civil society organisations and companies. As climate change is perhaps the dominant issue of this generation, it is worth assessing its relationship with the Extractive Industries Transparency Initiative (EITI).

The first thing to say is that the relationship is not direct, close nor straightforward.  But there are three elements of the EITI process that might have beneficial lessons for tackling climate change: the report and monitoring process, the multistakeholder process, and the relationship with energy security.

1. Reporting, monitoring and communications capacities

Just as in the battle for greater transparency, the capacity to collect, monitor and communicate information is essential in the battle against climate change. Countries implementing the EITI are required to produce reports covering all payments made by extractives companies to the governments where they operate and for governments to publish what they receive. The production of these reports is often a complex exercise, requiring the collection of data from operating companies as well as the relevant government agencies receiving payments. In many cases, the reporting and monitoring capacities of governments is low and the EITI process helps to identify weaknesses in data collection, management and information dissemination.

Climate change activities requiring monitoring and reporting of CO2 emissions, verification of carbon credit projects, etc., are very likely to have similar capacity challenges and can draw from the experiences of EITI capacity building.

2. Multi-stakeholder governance

The EITI has been at the vanguard of multi-stakeholder initiatives, forging consensus between sometimes unlikely partners in governments, companies and civil society organisations. At the national level the EITI creates a platform for dialogue between local communities, government and companies that in many cases would not otherwise exist. The broadstakeholder groups involved in the EITI are the same as those that will need to work together towards battling climate change: companies, governments and civil society. The interests of these different groups are often divergent and at times in direct contradiction to one another, creating a challenging environment for consensus building. However, through trial and error, reflection, blood, sweat and tears, agreement has been forged from acrimony on a wide range of issues where none existed previously.

The interests involved in the climate debate are many and varied: environmental, commercial, local, national and international, technological and ethical. A monumental task lies ahead in getting these different actors together to agree a way forward in reducing CO2 emissions, carbon trading systems, technology transfer, compensation schemes, monitoring, verification and reporting, etc. New programmes such as the UN's Reducing Emissions from Deforestation and Degradation (REDD), set up in much the same way as the EITI with an international secretariat and a World Bank Multi-Donor Trust Fund (MDTF), may have something to learn from the EITI experience as they face the challenges of implementing their programme amidst a broad range of actors. Indeed, some of the EITI's partners such as Global Witness are already involved in REDD's efforts, and the EITI International Secretariat is more than happy to share the experience of our "curious coalition" with those seeking to establish similar structures in the area of climate change. We need to learn from each other in how we govern innovative governance solutions. 

3. Energy security and climate change

We will continue to need a lot of energy. To reduce the environmental impact of the use of energy, we need to be more efficient. Better governance leads to such improved efficiency and thus to a reduction in emissions. We also need to ensure that we look after the world's oil and gas reservoirs and that we get out of them as much as we can. As it is, countries with poor governance tend to recover less from their deposits than for example our hosts here in Norway with their sophisticated governance. While the likely impact of carbon capture and storage is much debated, it is enough to conclude that it will have some impact. We also know that we have come furthest with carbon capturing projects in well-governed environments.

 Not least in Europe, gas will be of growing importance to meet the energy needs. Much of this gas will replace coal and the burning of gas leads to less climate impact than the burning of coal. This move towards gas hinges in part on having reliable supply of gas. Good governance - transparency and accountability - in gas producing countries and during the transport of gas, is a precondition for this reliable supply. 

Some of our needs for energy in the future are likely to come from a growing use of nuclear power. This growth will require a growing extraction of uranium. Just as with gas, efforts will need to be made to ensure that the supply of uranium is reliable. And again, that safe supply relies on that the mining is done in an organised and transparent way.

The EITI will continue to remain focused on revenue transparency in the extractives sector, hopefully generating positive externalities for other reform efforts, including climate change initiatives.