USAID climate strategy overlooks key opportunities

The draft strategy gives short shrift to advanced clean energy technologies and measures to reduce short-lived climate pollutants (SLCPs)  

As the lead agency of the U.S. government working on-the-ground with developing countries, the U.S. Agency for International Development (USAID) plays a primary role supporting partner governments to meet their climate goals as part of global efforts to limit warming to 1.5°C under the Paris Agreement. The USAID’s investment choices are critical: the success of the Paris Agreement is underpinned by financial, technological and capacity support provided to developing country Parties to implement their nationally determined contributions. Higher levels of support are directly tied to higher ambition.

To these ends, USAID recently set an ambitious target to mobilize $150 billion in public and private climate finance by 2030, leveraging portions of the 11.4 billion in annual public climate financing announced by President Biden at the United Nations General Assembly. USAID further set an ambitious target to support partner countries to prevent six billion metric tons of carbon dioxide equivalent (MTCO2e) emissions by 2030 and released a draft Climate Strategy 2022-2030 for public review and feedback. This Strategy, to be finalized in early 2022, aims to advance U.S. government objectives to adapt to and reduce the effects of global climate change.

The proposed Strategy includes two primary strategic outcomes: 1) targeted direct actions aimed at scaling up mitigation measures, supporting climate resilience, and mobilizing financial support; and 2) driving systemic and transformational change, including through market signals, governance and including climate considerations across the many types of USAID interventions (e.g., health, development). While CATF agrees with the plan’s ambitions to support USAID partner countries to reduce, avoid or sequester 6 billion MT of CO2e by 2030 and its plans to target actions that prioritize scale and impact, we are concerned the draft strategy excludes nonrenewable carbon-free energy sources and other measures that are highly cost-effective and necessary to tackle the climate crisis.

Clean Air Task Force offered three over-arching comments on the draft Climate Strategy. They are summarized below:

1. As a core part of its climate strategy, USAID should support equal access to advanced clean energy technologies. 
2. USAID’s climate strategy should support President Biden’s leadership on the Global Methane Pledge by helping partner countries reduce SLCPs, including methane.  
3. USAID’s climate program should add emphasis on consistency with host country objectives to garner broader societal support for programs.  

CATF looks forward to the final USAID Climate Strategy 2022-2030 early next year. We plan to seek out opportunities to support USAID and other government agencies to strengthen international capability to make use of the full range of technologies and strategies needed to address the climate crisis, consistent with each country’s climate and development goals. 

Comment #1: As a core part of its climate strategy, USAID should support equal access to advanced clean energy technologies.

In the draft Climate Strategy, USAID proposes to focus investments on proven technologies, particularly renewable energy, and asserts that technologies such as clean hydrogen, advanced nuclear, and carbon capture, utilization and storage (CCUS) are “far from economic or commercial viability” and that “USAID will not invest resources in early stage R&D for technologies like these.” This broad-brush view ignores the rapid progress being made towards full-scale deployment of these fast-emerging technologies. It also ignores a critical opportunity this decade to support countries that will need these technologies to decarbonize heavy industry, freight, and power sectors, among others, to lay the groundwork for broad-based implementation. In fact, more than ten developing countries eligible for international financial assistance have specified interest in using one or more advanced clean energy technologies in their nationally determined contributions.

As the U.S. moves forward with domestic pilots and full-scale demonstrations, the country is well-positioned to support the transfer and deployment of advanced clean energy technologies to developing countries. Given the urgency of the climate crisis, we should not wait for full commercial deployment to share advances.

Drawing lessons from U.S. experiences, USAID has a role to play in assessing opportunities and barriers to advanced clean energy technologies and offering guidance on approaches, supportive policies, business models, partnerships, stakeholder engagement, just transition, and financing strategies–anchored by USAID resources–that could lead to successful technology transfer and deployment. This guidance and support could likewise position U.S. advanced clean energy technology companies to lead in new markets.  

Clean Air Task Force offered specific recommendations to better integrate advanced clean energy technologies within the USAID Climate Strategy, thereby making these technologies eligible for investment and accessible to developing countries seeking to deploy these tools to lower emissions.

Comment #2: USAID’s climate strategy should support President Biden’s leadership on the Global Methane Pledge by helping partner countries reduce SLCPs, including methane.

Alongside EU President Ursula von Der Leyen, President Biden championed the Global Methane Pledge. One of the major success stories of COP26, more than 100 world leaders committed to collectively reduce methane emissions 30% below 2020 levels by 2030. This includes leaders representing a number of developing countries, including top-twelve methane emitters Brazil, Indonesia, Pakistan, and Argentina.

While many of the measures to reduce methane and other short-lived climate pollutants (SLCPs) are well-understood and economical, the USAID Climate Strategy makes only brief mention of such actions and does not consider these measures in its assessment of how to prevent the release of 6 billion MTCO2e. Further, language aimed at severely restricting investments in new fossil fuels could also restrict capacity support and investments aimed at reducing methane emissions from oil and gas operations.

Clean Air Task Force offered specific recommendations to ensure that measures to reduce SLCPs, including actions to mitigate methane emissions from the oil and gas sector, would be fully eligible for USAID investment.

Comment #3: USAID’s climate program should add emphasis on consistency with host country objectives to garner broader societal support for programs.  

Parts of the draft USAID Climate Strategy emphasize climate change mitigation without considering the specific elements of the host country’s nationally determined contribution or other policy priorities (e.g., sustainable development, poverty eradication, COVID-recovery). Further, the draft does not sufficiently consider the capacity support and institutional strengthening that would be required to plan and implement long-term climate objectives. Accordingly, Clean Air Task Force offered specific recommendations to ensure host country ownership and capacity needs are not over-looked.