The unprecedented reference in the Glasgow Climate Pact 2021 to fossil fuels and their subsidies has been missing from climate treaties for over 30 years. The 1992 UN Framework Convention on Climate Change (UNFCCC) has few references to fossil fuels, predominantly to acknowledge the economic dependency of the world on fossil fuels, and the landmark 2015 Paris Agreement made <a href="https://theconversation.com/climate-justice-and-an-end-to-fossil-fuels-the-paris-agreement-wont-satisfy-activists-52260">no reference to fossil fuels at all</a>. Previous climate summits were unable to reach consensus on mitigation of any specific emission source, notably due to strong objections by countries with deep economic stakes in fossil fuel production, therefore, the principal driver of climate change has remained the elephant in the room. In this regard, the outcomes of the 26th Conference of Parties (COP26) to &ldquo;phasedown unabated coal power and phase-out of inefficient fossil fuel subsidies&rdquo; (para. 36, 2021 Glasgow Climate Pact) are significant in that a specific emission source is now part of climate negotiations, despite no mandate for the COP26 Presidency to explore this, and greater scrutiny and transparency on the financing of fossil fuels has been brought into the UNFCCC process.&nbsp;
Yet, the outcomes of COP26 also stipulated that the ambition to address climate change will require a transition that is &lsquo;just&rsquo;. This leads to questions such as, what is a &lsquo;just&rsquo; transition? And how do you finance it?
The call for a just transition in climate policy discussions was born from a concern that climate action, specifically decarbonisation and mitigation, would negatively impact fossil fuel workers, their communities, and the wider economy, and therefore, governments and the international community should allocate resources and implement policies aimed at ensuring that a transition to a low-carbon economy is done equitably. The International Labour Organisation (ILO) was an influential player in applying the concept of just transition to climate action with their publication of <a href="https://www.ilo.org/wcmsp5/groups/public/---ed_emp/---emp_ent/documents/publication/wcms_432859.pdf">Just Transition Principles</a> in 2015, and the <a href="https://www.ioe-emp.org/index.php?eID=dumpFile&amp;t=f&amp;f=134978&amp;token=91237abd5b4e38c1e7c2e4364b2b8e7095d8e0fd">Solidarity and Just Transition Silesia Declaration</a> at COP24 in 2018 solidified the concept as a running theme of UNFCC processes. Common principles attributed to the concept include a strong emphasis on job creation, investment, and social consensus as fundamental requirements on the pathway to sustainability. It is arguable that a just transition is necessary to achieve the Sustainable Development Goals&rsquo; (SDGs) overarching agenda for &lsquo;leaving no one behind&rsquo; and the ambition for the realisation of social, economic, and environmental rights for all.&nbsp; In this regard, an energy transition (even a green one) that does not protect the social, economic, and environmental rights of workers and their communities will have, in effect, left someone behind, and thus, will not have achieved a just transition or sustainable development.&nbsp;
This debate is far from academic.&nbsp; There is a growing resentment among fossil fuel workers and their communities in many parts of the world from a perceived or actual lack of social protections in decarbonisation agendas. There is merit to such concerns given that previous examples of industrial transitions have rarely resulted or even pursued equitable outcomes; the COP Presidency in Glasgow was no doubt wishing to find an alternative to the social, economic, and environmental deprivation observed in post-coal mining communities in the UK and elsewhere in the world. Unsurprisingly, the main beneficiaries of the EU&rsquo;s Just Transition Mechanism, a &euro;55 billion fund to assist the transition to carbon-neutral economies, are EU member states that are highly dependent on coal mining and power. The concern of the economic impact of decarbonisation is also shared by negotiators representing countries with carbon-intensive economies, such as China and India, whose view of a &lsquo;just transition&rsquo; entails industrialised countries cutting their emissions more quickly to allow emerging economies to transition away from fossil fuels at a slower pace, as well as greater technological and financial transfers from the Global North to the Global South. In this way, the concept of a just transition has evolved from a concern about the local and national implications of decarbonisation, and towards an international debate on whether mitigation commitments and resource allocation to climate action are being done in an equitable way.&nbsp;
In this context, the application of a social justice perspective to climate change, commonly expressed through the term &lsquo;climate justice&rsquo;, reveals that the burdens of climate change are unequal between nations, and social inequality within nations hinders the capacity of the poorest and most vulnerable to mitigate and adapt to climate change. This recognition of the unequal burdens of climate change is often accompanied by the call for &lsquo;transformative&rsquo; solutions to address the root causes of these inequalities. Afterall, addressing social injustice in climate and development policy is not only a moral imperative to &lsquo;leave no one behind&rsquo; but adopting a social justice perspective is also necessary to understand what is meant by &lsquo;just&rsquo; when it comes to allocating resources for climate action.&nbsp;
In layman terms, a &lsquo;just&rsquo; solution to financing climate action is usually depicted as a greater allocation of money to i) countries who are most impacted by climate change (e.g., developing countries), ii) those with limited capacity to engage in climate action (e.g., marginalised and deprived communities), and iii) those who face a disproportionate burden because of climate action (e.g., fossil fuel workers). However, perversely, those with the most need for assistance to engage in climate action face a difficult struggle to access resources dedicated for that very purpose. Indeed, the &ldquo;deep regret&rdquo; noted in the 2021 Glasgow Climate Pact (para. 44) for the failure of developed countries to provide the $100 billion per year of climate finance for developing countries has shone a spotlight on the longstanding and contentious divide between the developed and developing world on the question who pays for climate action and the damages caused by climate change. Developing countries have long argued that developed countries have historically produced a disproportionate share of greenhouse gas emissions, and therefore, developed countries hold a greater responsibility for paying for the damages. Whereas, developed countries have traditionally rejected that loss and damage caused by climate change should be considered a liability and require a financial transfer to rectify. The negotiations at the 2022 Bonn Climate Change Conference in Germany continued this irresponsible tradition by <a href="https://www.bbc.co.uk/news/science-environment-61819852">omitting from the official COP27 agenda</a> any discussion concerning a new finance mechanism for loss and damage. Subsequently, and despite the omission, the outstanding issue of loss and damage is set to <a href="https://news.trust.org/item/20220707051940-g845d">cast a large shadow</a> over COP27 in Egypt this year.&nbsp;&nbsp;&nbsp;
The debate surrounding climate finance typically avoids tricky issues of &lsquo;fairness&rsquo; or &lsquo;justice&rsquo; by making the case that taking on finance to drive low-carbon development is a win-win for developing and developed countries alike. Many developing countries, even prior to the 2015 Paris Agreement, sought to incorporate climate finance into their economic policy because finance was seen as a catalyst for economic development and poverty reduction, and poverty reduction is commonly held up as the strongest pathway to build &lsquo;resilience&rsquo; among the poorest and most vulnerable communities &ndash; a view shared by donor countries. There is consensus that climate action should be part of global and national development strategies given that climate change is affecting economic development now and will into the future.&nbsp; Unsurprisingly, then, adaptation, mitigation, resilience-building and economic development objectives can and often do overlap in climate and development policy because they must. Given this background, it would be nonsensical to view financing climate action as separate to financing development, rather than as co-objectives.&nbsp;&nbsp;
Yet, this nonsensical view is precisely the perspective that is found in the historically dominant view of development that <a href="https://www.tandfonline.com/doi/full/10.1080/14693062.2021.1976095">relegates climate action and social justice</a> as conditional on economic growth, or at least as secondary objectives. Moreover, there is a concern that traditional development finance (i.e., grants and concessional loans) is being repackaged as climate finance, and this repackaging can be broadly characterised as a move from grants to non-concessional loans, without addressing this nonsensical view. Alongside diminishing or stagnate commitments from donor countries for official development assistance (ODA), the significance of climate finance in development policy is only becoming more prominent.&nbsp;
However, the barriers faced by the poorest countries when attempting to access climate finance are similarly found when attempting to access development finance, namely insurmountable public debt and limited capacity to co-finance. For example, the Green Climate Fund (GCF), the most successful climate fund to date, requires countries seeking loans to provide <a href="https://theconversation.com/global-climate-finance-is-still-not-reaching-those-who-need-it-most-115268">substantial co-financing</a> from their tax base or private sector to mitigate financial risk from loans. Subsequently, the lion share of <a href="https://climateanalytics.org/publications/2021/five-years-of-the-green-climate-fund-how-much-has-flowed-to-least-developed-countries/">GCF funding does not reach Least Developed Counties (LDCs)</a>, who arguably need greater assistance, but rather reaches middle-income countries, which are better equipped to meet co-financing requirements. Similarly, the impacts of climate change are felt at the local level but social inequalities in a particular locale mean those impacts are felt differently (i.e., the poorest communities are more likely to be found in flood-prone areas and have fewer flood defences), and there is also a local dimension to communities whose economy is dependent on fossil fuels (i.e., communities which are literally built around mines or power plants). However, the vast majority of <a href="https://pubs.iied.org/10178iied">climate finance does not reach locally-focused climate change projects</a> &ndash; and even fewer funds mandate a gender focus in funding criteria, despite overwhelming evidence that <a href="https://www.undp.org/publications/gender-and-climate-finance">empowering women and girl is necessary for sustainable development and effective climate action</a>. The poor allocation of climate finance to who and where it is most needed reflects that there is currently a lack of clarity surrounding where climate finance should go, how it should be used, and, crucially, <a href="https://www.cgdev.org/sites/default/files/PP205-Mitchell-Ritchie-Tahmasebi-Climate-Finance.pdf">how it should be reported</a>.&nbsp;&nbsp;
Ultimately, if climate finance does not reach those who require it the most to mitigate and adapt to climate change, then this begs the question: who is the finance for?&nbsp; In this regard, social justice as a framework for climate finance is a prerequisite for mitigation and adaptation because it answers: those who need it the most. It is not a radical position to recognise that social inequalities affect different countries&rsquo; and peoples&rsquo; vulnerability to climate change, as well as their capacity to mitigate and adapt to climate change, because it is a widely accepted view &ndash; and a view that has led to the calls for a &lsquo;just&rsquo; transition at climate summits in the first place. It is simply time we bring this view into the debate on climate finance &ndash; and use social justice as a policy framework to direct climate finance and enable effective climate action in the process.

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