Improving Differentiation Further

Even though the proposed basic architecture provides significant direct benefits and several differentiation mechanisms it may be seen by some as not fully delivering on differentiated responsibilities.
Providing a flexible instrument is deployed, additional differentiation could be added at the collection point. IMERS additional differentiation could be as follows, in a given period of time:

  • Ships transporting goods only to Annex I countries pay 100% of emission charges;
  • Ships transporting goods only to non-Annex I countries pay zero (0);
  • Ships transporting goods to both types of countries pay a variable charge based on relevant mix of transport work (world average just under 60%).
The cost of emissions would most likely be recovered through increased freight prices on imports to Annex I countries only, thereby resolving the differentiation issue at hand.

Global but Differentiated Principle and Policy have been developed accordingly (It's new, and is seen as a breakthrough approach).

A narrower scope could reduce the environmental effectiveness and amount of funding aggregated. This would depend on the stringency of the goal applied. For the goal staying the same, the total benefits would be around 60% of the numbers provided earlier. For instance the amount of adaptation funding would be $2.4bn rather than $4bn annually (a very good result, and much better than the current 0 resulting from the existing deadlock).
A binary differentiation may even be replaced with country-specific obligation factors. These are typically defined in relation to responsibilities and capabilities, but so far have been only proposed to address equity of emission allocations (see for instance: the Greenhouse Development Rights Framework).