The world is going to need a Covax for climate

WHEN he stunned the Glasgow climate conference by committing India to achieving net-zero emissions by 2070, Indian Prime Minister Narendra Modi issued a crucial caveat. Without the “transfer of climate finance and low-cost climate technologies,” he said, developing nations such as India would never be able to achieve their ambitious targets.

That’s not an idle worry. If we have learned anything during the COVID-19 pandemic, it’s that the developing world cannot count on getting access to life-saving technologies quickly and affordably. With climate change, the consequences could be even more dire: The world will never be able to reach its climate goals if large emerging economies such as Brazil and India can’t decarbonize just as fast as the US and Europe do. World leaders need to address such concerns now, before they botch yet another global crisis.

The reality is that many of the key innovations in climate-related technologies, such as battery storage and carbon capture, are likely to come from Western companies. In theory, patent holders could ramp up production in lower-cost countries, or offer licenses to local manufacturers there, to ensure that their products are affordable at scale. Alternately, rich countries could provide enough climate finance to cover the cost of adoption.

But wealthy nations aren’t even meeting their existing financing pledges — let alone the $1 trillion India has demanded by 2030. And some companies will no doubt jealously guard their innovations rather than licensing them, for fear of losing valuable intellectual property.

Suspending IP rights, as India and South Africa have fought to do with COVID-19 vaccines, will not help. Decarbonization cannot happen without the willing cooperation of the private sector. While taxpayer support will be instrumental in developing new climate technologies, just as it was for mRNA vaccines, adopting, commercializing and integrating those innovations into emerging economies — working batteries into the electric grid, for example — will rely on private enterprise. Without strong IP protections, private investment won’t be directed at the problem at the scale the world desperately needs.

Leaders should learn from the errors they’ve made during the pandemic, especially the failure of institutions such as Covax, the common vaccine pool. Covax was supposed to channel vaccines manufactured in the rich world to developing nations. Calling its performance disappointing would be an understatement: Just 5% of the vaccines administered so far across the world have come through the facility.

Other good ideas have seen even less pickup. Last year, the World Health Organization set up what it called a COVID-19 Technology Access Pool, meant for “developers of COVID-19 therapeutics, diagnostics, vaccines and other health products to share their intellectual property, knowledge and data with quality-assured manufacturers, through public health-driven, voluntary, non-exclusive and transparent licenses.” Companies have roundly ignored the pool — although, in a rare spot of good news, Merck & Co. recently agreed to license its new oral antiviral medicine, molnupiravir, to a C-TAP-aligned body.

The pandemic didn’t exactly give the world a lot of time to design institutions to encourage technology transfer. We don’t have that excuse for the climate crisis. We need to develop and put in place stronger versions of Covax or C-TAP well in advance of the relevant breakthroughs in technology.

A “climate Covax” would focus on ensuring that innovations in climate-sensitive sectors, especially those developed with the help of taxpayer money, could be licensed for use in the emerging world at scale. Covax failed in part because it became just an allocation mechanism, without any right to contest bilateral deals between manufacturers and rich-country governments.

Its successor, therefore, should partner with those governments earlier on in the process and ensure that it is involved in the initial stages of research. Being a co-developer and co-funder would give the facility leverage to push companies to license the technology they develop — similar to how the US National Institutes of Health is pushing Moderna, Inc. on its vaccine patent.

A climate Covax would also have to invest directly in manufacturing, rather than depending entirely on existing suppliers. Covax’s overdependence on the Serum Institute of India Pvt. Ltd. meant that New Delhi’s vaccine export ban following India’s devastating second wave crippled the program.

And, finally, rich-country governments supporting fundamental research into climate technology need to write better contracts. The Biden administration might want to help get mRNA vaccines to the world. But officials have complained that their hands are tied by absurdly restrictive contracts written during Operation Warp Speed.

If it passes, the administration’s Build Back Better framework will pump hundreds of billions of dollars into climate-related private-sector innovation. Now is the time to ensure that the world benefits from that investment just as much as individual companies do.

BLOOMBERG OPINION