Countries are being asked to commit to greenhouse gas reductions and rules to 2020 and beyond. But serious challenges exist at the UN table and, rather than a legally binding deal, the compromise will be a high-level framework with details to follow.
In December, north of the 56th parallel, Copenhagen will host a geographic and temporal moment in history. Nearly 200 countries will gather to decide whether, over a few decades, our political ecosystems can collectively and significantly reduce greenhouse gas emissions (GHGs) and whether every country can commit to action according to its own circumstances. Let’s be clear: to agree to 2020 or 2050 targets, most governments would need to make global commitments that extend beyond their elected mandates or, for non-democracies, potentially beyond their authority.
Like Kyoto in 1997, Copenhagen’s COP (Conference of the Parties) 15 is a culminating United Nations meeting aimed at setting the next generation of targets, rules and mechanisms to reduce global GHG emissions. While the Kyoto Protocol covers the period from 2008 to 2012 and seeks roughly a 5 percent GHG reduction from 1990 levels, the Copenhagen agreement would cover 2012 to 2020 and may seek a 20 percent GHG reduction by 2020 (although some countries are calling for up to 40 percent) from a 1990 baseline, although there is some disagreement here as well.
Adding another level of complexity, there is a call for a voluntary 2050 target of up to 80 percent GHG reduction from developed countries. This is included because developing countries are unlikely to significantly reduce their GHG output until sometime after 2020 since their economies and GHGs will continue to grow before they decline. That means to get China and India to agree to reducing, their timeline has to go to 2030 or beyond. Although it is not explicitly stated, the 2050 or 80 percent reduction target scenarios would basically create a low-carbon economy where our energy production and consumption patterns and our lifestyles have changed in ways we can hardly imagine today. It was ever thus — our children will live in a world different than the one we have known.
The task in Copenhagen is Herculean and the Danish government and its politicians have committed themselves tirelessly to a positive outcome. However, the prognosis for a binding global deal in 2009 is not good, and expectations have been progressively lowered through the fall. Hundreds of honest negotiators have travelled all over the planet this year narrowing differences, but major gaps persist on many, many technical details. Making a special trip to the Asia-Pacific Economic Cooperation (APEC) summit in November, Denmark’s prime minister, Lars Rasmussen, reframed success as “one agreement — two purposes.” His view is that there can be a high-level framework set this year with a commitment that those political directives would be translated into a comprehensive and legally binding deal by the end of 2010.
In general, the new agreement seeks to set rules primarily around “common but differentiated responsibilities” for developed and developing countries; financing for developing countries; steps to reverse the effects of climate change (mitigation); steps to accommodate what’s already happening (adaptation); the transfer of technology; and rules governing the use of market mechanisms such as a global cap-and-trade system. Whether a deal can be struck on all these topics remains to be seen. The two toughest political conundrums to be resolved will involve targets and money.
As we seek to understand the broader context and political realities that will shape the Copenhagen outcome, we do not need a perfect understanding of the complex technical issues or pages of bracketed negotiating text. Others will do that analysis. For now, let’s explore four questions that will affect the politics of the global negotiations:
- Does the new agreement bring all the players into one deal (even if targets, roles and timetables vary) and create a downward trajectory for GHG emissions?
- Does it recognize that serious emissions reductions by 2020 will come only through transformation of our energy, transportation and infrastructure — in the developed and developing worlds?
- Does it recognize that a deal on climate change affects each country’s trade and competitive opportunities in a global and potentially low-carbon economy?
- Whatever is decided in Copenhagen, can leaders take home a deal from the UN table that they can sell politically?
What we understand today is that a tonne of carbon is a tonne of carbon is a tonne of carbon. No matter where it is emitted on the planet, it has an impact
on our atmosphere and adds to the overall greenhouse gas effect. The other challenge of climate change is that the impact is cumulative and additive. It’s not a local or a personal problem. It’s a global problem. And the sooner emissions are reduced every where, the better.
The prognosis for a binding global deal in 2009 is not good, and expectations have been progressively lowered through the fall. Hundreds of honest negotiators have travelled all over the planet this year narrowing differences, but major gaps persist on many, many technical details.
There is an “after you, Alphonse” dimension to global climate change negotiations. Developing countries say that the developed ones are and have been the major emitters, created the problem, should therefore accept targets willingly and reduce their emissions, and that their economies can afford to do so. That was the premise of the Kyoto Protocol. However, today many developed countries are saying that they will not commit to the next round of targets and rules unless developing countries also take responsibility for reductions, particularly looking ahead to 2020 or 2050 when developing countries’ emissions may meet or surpass those of the developed world.
It should be noted that least developed countries without economic means are in a category of their own. They tend to have high poverty rates and low GHG emissions profiles, and some suffer a disproportionate burden of climate change impacts. This group would include the majority of African countries and some Latin and Asian countries plus small island states. They would have “differentiated” responsibilities in a global deal and would likely be the recipients of climate change financing or aid.
For the other countries, in the 12 years since the Kyoto Protocol was created under the United Nations Framework Convention on Climate Change (UNFCCC), the world’s economy has changed dramatically and countries like China, India and Brazil aren’t developing anymore. They are economic forces. China has also now surpassed the US as the largest annual producer of GHGs on the planet. Through the economic crisis of the last 12 months, we have also learned that we live in a global and interconnected economy, that our financial systems are linked and interdependent. So it shouldn’t be that much of a stretch to understand that our atmospheric system is linked and interdependent. But there are a couple of challenges that need to get sorted out.
Few people realize that the Kyoto Protocol may actually pose a structural impediment to a Copenhagen deal, at least for the US. In 1997, Kyoto split the world into 40 developed countries that signed up for binding targets (Annex I) and OECD countries that agreed to non-binding targets (Annex II), and brought the developing world into the equation by creating tools to finance projects in their countries through things like the clean development mechanism. The world’s largest emitter at that time, the US, signed the Kyoto Protocol as Annex I but did not ratify, and the divisions deepened.
The Kyoto Protocol outcome is relevant today because negotiators in Copenhagen will be wrestling with the form of the successor agreement. Will Copenhagen produce a new chapter linked to the Kyoto Protocol to cover 2012-2020 (as European Union countries want) or something different (as the US and Canada want)? Will the Kyoto Protocol survive? Or will a new arrangement be drafted that provides more room for trade, energy and economic concerns? More about that in a moment.
Whatever the form, the Copenhagen agreement will have to create a common framework for developed, developing and least developed countries to move together, taking GHG emissions further and further down. It would be better politically if it was all done at one table with one agreement, but it is unclear whether that will be achievable in Copenhagen.
It cannot be said too many times. Responding to climate change is all about how we produce, consume and conserve energy — whether in our neighbourhoods, our communities and our urban centres or at the sub-national, national and international levels. We return to the need for fundamental changes in how we power our homes, produce our goods, drive our cars and tap into energy sources — whether we live in Australia, China, Canada, Ethiopia or the US.
Countries increasingly understand that policies that significantly reduce GHG emissions over the medium to long term will involve changes to our energy, transportation and infrastructure systems. It means things like diversifying our energy mix to include more renewables, replacing capital stock, changing our buildings and upgrading our energy distribution systems.
However, the majority of countries, including Canada and the US, have not yet created the regulatory systems, investment climate or market mechanisms to properly stimulate the level of change and transformation required to meet a 20 percent reduction target by 2020, let alone an 80 percent reduction by 2050. There is no question that some countries have done more, but no one country has all the answers.
In the international context, there are questions about whether the UN climate change process, seen by some as a purely “environmental” agenda, has yet fully recognized the depth of the energy and infrastructure challenges facing countries and regions. There are also frustrations about how difficult and narrow the UN process has become. As a result, countries have increasingly pursued blended energy and climate change conversations at different and often economically focused tables. Leaders have formally discussed both issues at G8, G20 and APEC meetings for the last few years. The International Energy Agency (IEA) and the OECD are also producing comprehensive reports that provide important information at the intersection of energy and climate change policy, including scenarios that extend out to 2050.
Both developed and developing countries need to produce more low-carbon energy and use less energy over all. Recognizing that the challenges for high-emitting countries are different, two other initiatives have also emerged. One is the Asia Pacific Partnership on Clean Development and Climate. It represents 50 percent of global energy use, focuses on technology and includes Australia, Canada, China, India, Japan, Korea and the US. The other group, the Major Economies Forum, was started as a complementary process to the UNFCCC where the countries representing 80 percent of emissions (all G8 countries plus Australia, Brazil, China, India, Indonesia, Korea, Mexico and South Africa) meet in a parallel process to try to reconcile issues away from the UNFCCC and suggest practical ways to advance the negotiations.
In general, these tables are constructive since they build understanding between countries with similar challenges, help explore negotiating options and focus on emissions reduction strategies as well as energy and technology. But it would be better if the energy conversation were more fully incorporated into the UNFCCC process, rather than parallel to it.
A word about how the UNFCCC process views financing and technology transfer. In the international negotiations, financing means a global equalization payment collected from the developed world and paid to the least developed or developing world to adapt to climate changes and transform their economies to low-carbon futures. The current proposals are for payments to a global fund in the neighbourhood of $100 billion per year. Technology transfer refers to opportunities for developed countries to share their more modern technology with the developing world. It is a kind of clean export mechanism.
Both these tools correctly establish the investment challenge that developing or least developed countries have to transform their energy systems. What has not been properly addressed is the double whammy that exists for developed countries (that means Canada), where we have our own domestic challenges about how we convert our own systems, financing it either directly or indirectly through increased energy prices, and also paying into an international fund to finance those same carbon system changes somewhere else on the planet. Noble, moral and important, yes. A domestic priority in a post-recession economy where we’re facing five years of deficits? We haven’t had the public debate yet. And given the public concern expressed a few years ago about buying “offshore credits”’ or “Russian hot air” to meet our Kyoto target, it is not clear how much support there would be from Canadians.
Although the original Kyoto Protocol anticipated that there would be an economic impact to addressing climate change, much has been learned in the last 12 years of applied climate policy around the world. The so-called flexibility mechanisms have not worked as well as anticipated and the global carbon market has not yet been broadly established, except in the European Union and smaller voluntary markets. We now understand that climate change rules affect competitiveness, trade and, if a price for carbon is established, fiscal policies.
Part of the reason for the standoff between developed and developing countries is that we now see clearly that, in a global economy, commodities, goods and services that are subject to emissions limits in one country have to compete with those not subject to GHG limits in another. The latter will be produced more cheaply and over time erode domestic industries that comply. This results in carbon “leakage” and leaves several energy-intensive sectors legitimately concerned about global competitiveness. If China and other emerging economies do not have responsibilities, there is a question about whether protectionist tendencies would win out and border tax adjustments or carbon tariffs would be introduced.
On a positive note, the trade dynamic, rather than being only a domestic limitation, can spawn “clean trade” as opposed to free trade agreements. President Obama was in China in November and, while he did not extract a commitment from President Hu Jintao on a reduction timetable, the two countries (accounting for 40 percent of global emissions) signed no fewer than seven bilateral agreements on energy initiatives, including a cooperative research centre and trade partnerships on renewable energy, electric vehicles, coal, energy efficiency, shale gas and clean-tech exchanges with US and Chinese companies. There would be advantages if countries, including Canada, could capitalize on more clean-tech trade and export opportunities. The current UNFCCC process does not have the mandate to talk about trade, but it would be better if more could be done to recognize the value of these types of arrangements for climate change results; and it might well increase their political traction.
Even in a global deal, all politics is local. So no matter what the result in Copenhagen, the agreement has got to be sold at home — by politicians — to their electorates. Judging from Canada’s experience with the Kyoto Protocol, the questions can be either, Did the government do enough? Or did it go too far? In 1997, when Canada committed to reduce emissions by 6 percent from 1990 levels by 2010, the answer from the provinces and Canadian industry was, Too far. And it took Canada five years to sell the Kyoto Protocol target and resulting measures to Canadians because we did not ratify until 2002. Even then it took an act of political will to stare down the lack of national consensus.
But the real cautionary political tale that haunts the Copenhagen talks is the US Senate’s 1997 vote of 99 to 1 against signing up for targets that didn’t include developing countries. The Clinton administration could not sell what happened at Kyoto and basically deferred the American national debate on climate change until the Obama administration campaigned on a clean energy future last year.
Then there is the other end of the political telescope. Selling any limited deal will look quite different to the leadership of Vanuatu, a small island state that is losing its land mass to rising sea levels. Its people likely believe that the deals so far have not been nearly enough.
We forget that not since 1992 at the Rio Earth Summit have most countries agreed on climate change. That was when 160 countries created the UNFCCC to “stabilize greenhouse gas concentrations in the atmosphere at a level that would prevent dangerous anthropogenic interference with the climate system.” But there were no targets and little political skin in that game.
Since then, challenge targets have become the currency of climate change debates. It’s how we convince our citizens and other countries that we’re serious. And there is a panoply of apples and oranges targets to compare. In 2006, Canada traded its original Kyoto GHG target of 6 percent reduction from 1990 levels by 2012 for a 20 percent reduction from 2006 levels by 2020. US legislators are currently debating whether to reduce 17 or 20 percent from 2005 levels by 2020.
Further confusing the debate is that a target can also be expressed in terms of whether 350 or 450 parts per million (ppm) of CO2 is the safe upper limit for the atmosphere — even though we are already at 390 ppm today. And the Danish negotiators talk in terms of limiting the temperature rise to 2 degrees centigrade, a point at which scientists say that “catastrophic” climate change can be avoided.
Today we don’t have the luxury to keep confusing the public with ever-shifting targets. Countries are now faced with real economic impacts from either adaptation or mitigation with real costs to consumers (read voters). The challenge in Copenhagen and likely beyond is whether there can be agreement on “common but differentiated responsibilities” plus who is going to pay to accelerate such a massive transformation in our global economy and how it can be done. And it really will take decades, not a few years. But we must stop arguing about the past and get started on the future.
It is also worth noting that through 2010, it will be our turn in North America to host the next rounds of international conversations on climate change, energy and technology. Canada will be hosting both the G8 and the G20 in Ontario in June, and Mexico will be hosting COP16, the next step in the UNFCCC process and potentially where the legal text of the next agreement may well be finalized. It is not a year when we can sit on the sidelines.
We will also be watching to see whether the US passes comprehensive energy legislation (including cap-and-trade provisions) in early 2010 prior to the midterm election window. Given that Canada has linked the timing of its domestic GHG regulatory system to the US, how the Obama administration approaches Copenhagen and its domestic politics will strongly influence the tone and timetable for how our government will proceed in Canada and within the Clean Energy Dialogue.
We can achieve a relevant global deal on climate change only if our political debate is elevated to understand the scope of the intergenerational challenges facing our economic, energy and environmental systems. It would be a deal that reconciles the trade-offs and engages citizens in the solution. If an agreement like that could be crafted, it wouldn’t matter where it was signed. It would be a good day for the planet.