Kyoto
NATTA's Guide to the UN Conference on Climate Change
in Kyoto, Japan, 1-12 Dec. 1997.
Based on material from RENEW, NATTA's bimonthly journal.
NATTA is an information services on renewable energy based with EERU, the OU's Energy and Environment Research Unit.
The views expressed in RENEW should not be taken to necessarily reflect those of all NATTA members, EERU or the Open University.
The Third Conference of the Parties to the UN Framework Convention on Climate Change Kyoto, Japan, on 1-12 December.
The UK has signed up to the EU proposal for Kyoto which was for a 15% reduction in greenhouse gas emissions, below 1990 levels, across the basket of greenhouse gases by 2010, and at least a 7.5% reduction by 2005. This was backed up by the UK Government's domestic target of a 20% reduction, below 1990 levels, in CO2 emissions by 2010. Japan had called for up to a 5% cut by 2010 for some countries, while the USA in a surprise announcement, almost wrecked the whole exercise, when it reneged on its agreement to get emissions down to 1990 levels by 2000. But the conference went ahead nevertheless.
In what follows we report on events in the run up to the Conference and on subsequent developments.
-------------------------------------Contents
1. Introduction: starting positions
3. Review of OECD Countries Policies
5. Events at Kyoto.. as they unfold
1. Introduction: starting positions
(from Renew 110)
1.1. Climate Debate Heats Up Globally
1.2. Clintons 1m Solar Roof' Plan
US Poll backs Action on Global Warming
1.3. Europe Pushes Ahead
1.4. EC Views: Euro-Green Paper: Renewable Permits
1.5. BP on Kyoto
1.6. Kyoto Lobbying
Sustainable Industry Lobby
Wind Lobby- EWEA
1.7. Greenpeace- 'Not Enough Sky'
GREENPEACE Campaign
100 Days of Action on Kyoto
1.8. FoE: ACTION ON CLIMATE CHANGE
COULD CREATE 226,000 NEW JOBS
1.9. Nuclear Kyoto?
1.1. Climate Debate Heats Up Globally
The international debate on what to do about global climate change has been heating up over the year - 1997 looks like being the hottest year for the debate, and also perhaps for the global climate, on record.
In June Tony Blair hit the UN Rio-II Summit hard, arguing that everyone had a responsibility to act - business, consumers, individuals.
He was batting on an easy wicket given that the UK had so far succeeded in reaching the carbon dioxide emissions target set at Rio (courtesy of the 'dash for gas'), whereas most other countries, Germany apart, had not.
The major problem areas were Canada, the USA and Australia. They, and Japan, had all continued to increase emissions. But the US administration seemed loath to respond - and Blair's call for lifestyle changes, quite apart from the EU proposal for a 15% C02 cutback for developed countries by 2010, was ignored.
In part the problem is the major oil, coal and car lobby, in the USA and elsewhere, coupled with the international financial system.
The US Institute for Policy Studies had claimed in a report released just before the UN and G7 summits, that oil, gas and coal projects financed by the World Bank since the Earth Summit will, over the lifetime of the projects, release more carbon dioxide than is now being produced each year by the entire planet.
"This is not only environmentally unsustainable, it is the height of hypocrisy for an institution entrusted with poverty alleviation, sustainable development and climate change mitigation" said the report's co-author, Daphne Wysham.
The report noted that the bank spends 100 times as much on fossil fuel developments as on the entire Global Environmental Facility budget intended for projects that "avert" greenhouse gas emissions.
In this context, the upcoming Climate Change Conference in Kyoto in Japan faces a difficult task.
It seems unlikely that the 15% reduction being sought by the EU will be accepted. Japan recently proposed just 5%, although this was widely criticised, not least by the UK Government, as being insufficient.
In July the US Senate passed a Resolution, by a vote of 95-0, recognising that climate change was indeed a problem, but insisting that the US should not commit itself to any specific agreement at Kyoto, unless the developing countries also made a commitment. Clinton obviously wants more, but his hands seem to be tied.
1.2. Clintons '1m Solar Roof' Plan
Although the USA seems to be dragging its feet in terms of making global commitments to emission targets, it is working on specific initiatives. Back in June, President Bill Clinton announced a 'Million Solar Roofs Program', part of his Administration's effort to cut global warming.
At the United Nations Earth Summit in June he outlined his plan, which includes assistance to developing nations for environmentally conscious energy use, strengthening of environmental standards for private investment projects in developing nations, a tripling of automobile fuel efficiency and a new solar photovoltaics initiative: "We will work with businesses and communities to use the sun's energy to reduce our reliance on fossil fuels by installing solar panels on one million more roofs around our nation by 2010. Capturing the sun's warmth can help us to turn down the Earth's temperature."
At a White House conference on climate change in July Clinton noted "it is obvious that we cannot fulfill our responsibilities to future generations unless we deal with our responsibility to the challenge of climate change", and added, quoting Vice president Gore, "... the overwhelming balance of evidence and scientific opinion is that it is no longer a theory, but now a fact that global warming is for real."
He went on "And so what we are doing today is beginning a process in which we ask the American people to listen to evidence, to measure it against their own experience, but not to discount the weight of scientific authority if their own experience does not yet confirm what the overwhelming percentage of scientists believe to be fact today."
He concluded " I do want to say that I am convinced that when the nations of the world meet in Kyoto, Japan, in December on this issue, the United States has got to be committed to realistic and binding limits on our emission of greenhouse gases. Between now and then, we have to work with the American people to get them to share that commitment. We have to emphasise the flexible market-based approaches. We have to embrace research and development efforts in technology that will help us to improve the economy - improve the environment while permitting our economy to grow."
However, the subsequent round of UN negotiations on climate change in Bonn, Germany did not make much progress. Next comes Kyoto.
For details of the US plan see http://www.eren.doe.gov/new/whats-new.htm
Technology to the Rescue?
ONE RESPONSE to Clinton's comments on Climate Change at the White House conference in July was from Chrysler Corporation Chairman, President and CEO Robert J. Eaton:
"Instead of trying to put the U.S. on an energy diet by using taxes or some sort of rationing scheme, the U.S. should lead the way in a major push to develop breakthrough technologies that lead to the reduction of greenhouse gas emissions".
US Poll backs Action on Global Warming
Americans are convinced that Global Climate Change is real, and believe that the problem can be solved without hurting the economy, according to an opinion poll conducted for the World Wildlife Fund (WWF) The survey reveals that Americans, in surprising and overwhelming numbers, believe global warming is real and represents a serious threat. Conducted by The Mellman Group, the poll also shows the public rejects scientific "skeptics" who cast doubt on global climate change, strongly supports international efforts to cut greenhouse gas emissions, and believes that strong measures can be taken without hurting the economy.
WWF new report, State of the Climate - A Time for Action, is a comprehensive account of the most current evidence and impacts of global warming across the world, including melting glaciers and permafrost, changes in animal and bird migrations, rising sea levels, drastic population declines among some species, and dying coral reefs.
1.3. Europe Pushes Ahead
Unlike the USA, the European Union seems to be adopting a fairly radical position on Climate Change and renewable energy these days. As we noted in Renew 108, there is talk of 15% or even 20% contributions. With figures like this being bandied about, it is important to be more specific about actually what is meant.
The 1994 Madrid Declaration, which emerged from Euro Conference in Madrid, called for renewables to substitute for 15% of conventional primary energy by 2010.
The Green Paper on Renewables produced as a discussion document by the European Commission last year (see Renew 107) proposed a target of a 12% contribution to EU energy consumption by 2010, which would result in a 20% reduction in energy imports to the EC.
The recently published TERES report (TERES II) which we mentioned in Renew 109 also sees renewables only supplying 12% of EC energy by 2010 - and 14% by 2020. However these figures are based on a slightly different method of statistical comparison, i.e. on actual energy use rather than on primary fuel use.
The 12% energy use figure converts to around 15% on a primary fuel substitution basis. Whatever the precise figures, the implication is that there will be a big expansion, since at present the total EC renewable energy contribution is only 5.4%. The next stage is the production of a EC White Paper.
The European Parliament is obviously keen to press ahead, to make it as radical as possible, and various lobbying groups are acting to support them, including EUFORES the European Forum for Renewable Energy Sources (see below).
1.4. EC Views
Christos Papoutsis EC Commissioner responsible for Energy, was one of the supporters of 'The Declaration of Madrid', which set an objective to replace 15% of primary energy sources consumed in Europe with RES by 2010.
More recently, the Parliament adopted Peter Mombaur's report, which suggests the same objective. Is this realistic?
According to Papoutsis, interviewed in the EC 'Renewable Energy Journal' (No 5 - November 1996):
'This is not yet an official Commission objective but it could well be achieved, if the political will exists and the right policies are implemented at both Community and national levels. I entirely agree with Peter Mombaur, and I assure you that the Commission will soon implement an official action programme to reach this goal'.
Recent events make him even more confident:
'Following the recent more rapid penetration of wind energy in some Member States, and the joining of 3 new Member States to the EC, we have already achieved a 6% share of renewables in the overall energy supply in 1996'.
The three new members are Austria, Sweden and Finland, which joined to EU in 1995 and caused the share of renewable energies to increase from 3.6% to 5.1% overnight. These three new countries, already have a share of 30% of renewable energy sources in their primary energy demand - so they have already gone far beyond the target of 15% set for the European countries.
However the EC journal notes: 'the other 12 Members still wonder if they are able to reach the 15% target by the year 2010'.
Euro-Green Paper: Renewable Permits
The European Commission's Green Paper on renewables (see Renew 107) proposes that a specified percentage of a country's electricity requirements will have to be met from renewable sources and that each electricity supplier or utility will be given their own target, with the potential for trading in credits if the company is unable to satisfy its demand or has produced in excess and wants to sell on the surplus.
The Netherlands have a plan for such an obligation already. The idea is also supported by the renewables lobby in the European Parliament. Prominent Euro MP Eryl McNally wants renewables to have a higher profile and thus proposed the creation of a Eurenew Treaty to rival the Euratom Treaty launched in 1958. She also wants a Joint Renewables Research Centre established - with a 2 bn ecu budget. See Windirections Vol XVI No 4 July 1997.
1.5. BP on Kyoto
We need to take precautionary action now' So said BP Chief Executive John Browne, discussing Climate Change at a recent meeting in Berlin.
'Developing the right policies to deal with that situation will be a complex process. The problem won't be solved by denying or restricting the economic expectations of the people of Asia, or Africa or Latin America. Nor will it be resolved by destroying the living standards of the world's developed economies. The first would be immoral the second unrealistic'
He added ' Kyoto is an important meeting but it is just one more step in a continuing process. I hope that some measure of agreement will be reached, and that it will lead to the involvement of the whole world.
That wide involvement is necessary to remove the concern, which is felt in different ways in both the developed and the developing world, that participation in the process will create a competitive disadvantage if others opt out.'
He then went on to outline 'three policy instruments which seem likely to be taken up by different governments ' - taxation, emission trading and joint implementation.
On taxation, he felt that 'the test of any proposed tax in this area should be its actual impact on reducing greenhouse gas emissions. So called "green taxes" can't simply be a politically convenient means of raising revenue. In the UK we have long experience of petrol taxation. More than two thirds of the price of a gallon is now accounted for by tax of one sort or another. Those taxes raise a lot of revenue -but they don't change behaviour - consumption continues to rise. Those taxes don't create real incentives for change - because the choices available to consumers are too limited.
To be effective taxation designed to improve the efficiency of energy consumption would have to cover all industry sectors and to be based on a level playing field between fuels. It would need to be set at a rate which actually changed behaviour, with the revenue used to give manufacturers and consumers the opportunity as well as the incentive to reduce emissions - by changing the fuel mix or using improved technology.
In terms of emission trading he noted that the U.S. 'already operates two domestic permit trading systems, one aimed at curbing sulphur emissions, the other at phasing out ozone-depleting substances. The sulphur trading system has been hailed by many as a great success. Since it began in 1992, five auctions have taken place on the trading floor of the Chicago Board of Trade, seven million allowances have been sold and the price per allowance has fallen by almost 50%. The result has been a 5.6 million tonne reduction in sulphur emissions with the prospect of a further 4.4. million tonne improvement by 2010. On this basis the programme will meet its objective which is to cut sulphur emissions by 40 per cent from a 1980 baseline'.
And he seemed hopeful that carbon emission trading could build on this experience.
He saw Joint Implementation as 'doing the most effective things in the places where they have the greatest impact.' and again seemed quite keen.
Browne was even more enthusiastic on BP's new found strong commitment to solar PV. 'The trends in photovoltaics are very encouraging'.
However he warned that ' there are still large obstacles. The acceptability of solar to the consumer will determine whether we can achieve the economies of scale in production which are necessary, and the technology needs more work to bring down costs. Again I'm optimistic. By 2020 we believe up to 5 per cent of world energy could be supplied by renewable energies, including solar power. Within 50 years it could be as much as half.'
'We see Solar as a significant long term business opportunity. We continue to develop the technology and to build the market. We are testing what is possible by using Solar power on a series of our own retail sites. If those tests are successful we will look to extend these solar powered sites across the world.
We're also installing solar on bigger projects as well, including the site of the athletes village for the next Olympics in Sydney, Australia. That will be the largest concentration of solar powered homes connected to the grid anywhere in the world.
However he warned ' it is a long term process. Given the current economics, solar won't replace oil and gas as the prime source of energy supply in the lifetime of anyone in this room. But given the advances in medical science as well as in photovoltaics I think many people here will live to see solar playing a significant role in world energy supply.'
In effect responding to Greenpeace's campaign to halt exploration (see below), he claimed that oil and gas, 'will be required to meet the world's energy needs. That is why we continue to explore and develop new resources and why we are so committed to ensuring that they are used with maximum efficiency, and the minimum of emissions. We are determined to make a constructive contribution to that effort.'
1.6. Kyoto Lobbying
Just about everyone is lobbying on Climate change at present in the run up to the Kyoto Conference in Dec.
Sustainable Industry Lobby
The European Business Council for a Sustainable Energy Future ('e5'), the International Cogeneration Alliance (ICA) and the US Business Council for Sustainable Energy, organisations representing the sustainable energy business, issued a statement noting that they believed that 'early and effective action is needed to limit climate change, increase geopolitical stability and promote economic development.'
They added 'the solutions to the climate change challenge are not technology constrained, but require changes in economic and regulatory frameworks.
Indeed, a wide number of technology solutions are available now at zero or negative cost (ie are profitable). Other technologies will become competitive with mass production. These technologies, if implemented early and gradually in a competitive market environment, will be positive for business and employment prospects worldwide.'
The three organisations recommend that Parties to the UN Framework Convention should:
- Agree on clear and near-term targets for emissions reduction of CO2 and, at least, a first target for annex I countries by 2005. After achievement of this commitment, there should be a full expectation of future targets for non-Annex I countries.
- Enact Joint Implementation only for energy-related projects and use emissions trading only between Parties with commitments.
- Reject borrowing from future emissions budgets and long-term budget periods in excess of 5 years as they send muddled signals to the marketplace.
Wind Lobby- EWEA wade in
Meanwhile the European Wind Energy Association made its views known at the Bonn Conference- the preparatory meeting for Kyoto. The EWEA pointed out that the installed wind energy capacity in Europe has increased by about 40 percent a year over the past six years. It added that wind energy projects across Europe produced enough electricity to meet the domestic needs of five million people. By the end of 1996, more than 3,400 megawatts of wind energy capacity had been installed in Europe. And the industry has set itself a target of 40,000 megawatts to be installed by 2010, which would provide electricity for about 50 m people.
1.7. Greenpeace- 'Not Enough Sky'
Not to be left out Greenpeace have produced a comprehensive scientific report on the global "Carbon Logic", showing why the Climate Convention requires governments to severely limit the amount of fossil fuels that can be burned - and why this is less than the total amount already identified as "reserves".
Chris Rose from Greenpeace explained their view: "In our estimation, to stay within ecological limits, fossil fuels have to be phased out within 30 - 40 years at present rates of use. We are at the start of a long term campaign to defend nature by accelerating human progress - into the 21st century and away from fossil fuels and towards, instead, solar power and other clean efficient renewable energies."
He went on "It has been said that all great truths begin as heresies - and the truth here is that there is not too little oil but too much, and there is instead, too little sky."
Greenpeace has also renewed its challenge to BP to make solar power affordable for ordinary consumers following revelations that a report co-ordinated by BP Solar proves this would be possible, despite claims to the contrary from the oil industry.
Greenpeace says a report co-ordinated by BP Solar in its possession details how a solar 'super-factory' could be built for £350 million - about half the cost of the oil company's current investment in the Foinaven field in the Atlantic Frontier.
"If we can put solar power within the reach of consumers' pockets, why aren't we doing it? " asked Greenpeace UK's Deputy Executive Director, Chris Rose. "Our campaign against oil exploration has been mounted to convince governments and oil companies to switch to solar power to save the climate. Now we have proof they know they can afford to do this and bring employment and prosperity for the UK as well."
For further Info contact Greenpeace on 0171 865 8255/6/7/8
GREENPEACE Campaign
According to Greenpeace support is growing for their campaign to prevent climate change by halting oil exploration and investing in solar power.
Over the summer almost 90,000 people signed a petition urging Tony Blair "to prevent climate change, by stopping new oil exploration in the Atlantic Frontier and investing in clean energy such as solar electricity."
This is backed up by a cross party group of nearly 90 MPs who have supported the campaign in some way including the signing of Early Day Motions calling for the re-direction of fossil fuel subsidies to sustainable energy technologies. The summer saw Greenpeace occupy the Stena Dee oil drilling platform in the Atlantic Frontier, and BP's subsequent legal attack, and then withdrawal.
100 Days of Action on Kyoto
Meanwhile, a loose coalition of individual activists and groups has come together in the run up to the Kyoto Conference, aiming to highlight the need to phase out fossil fuels, by non-violent direct action.
Contact on 0171 865 8234 e-mail 100days@waveland.org
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1.8. FoE: ACTION ON CLIMATE CHANGE COULD CREATE 226,000 NEW JOBS
Cutting carbon dioxide pollution - the main cause of dangerous climate change - could create almost a quarter of a million jobs for the UK economy according to new Friends of the Earth research.
It shows that meeting the Government's target of cutting carbon dioxide emissions by 20% by 2010 will create hundreds of thousands of new jobs through the expansion of public transport, rapid development of renewable energy sources and big increases in energy efficiency.
The research foresees a range of policy measures including a $1 per barrel of oil equivalent carbon tax rising by $1 per year and a reduction of VAT on energy efficiency materials to 5%.
Industries that spend a certain percentage of total overheads on energy would be legally required to employ a professional energy manager.
According to Tony Juniper, Campaigns Director at Friends of the Earth, "the bottom line for credible action on climate change is cutting oil, gas, coal and petrol use. If the Government isn't doing that then it is not serious about the issue. That objective has so far been seen as too radical but it can be made popular and economically viable by promoting alternatives that not only protect the environment but create jobs too."
FOE Special Briefing Sheet: "CO2 CUTS = 226,000 NEW JOBS" based on modelling work by the independent consultancy Energy for Sustainable Development employing the SAFIRE model, previously used in work for the European Commission.
1.9. Nuclear Kyoto?
France's decision to close the Superphenix Fast Breeder Reactor (see Renew 109) will no doubt fuel the ongoing debate over the future of Japan's nuclear programme - and indeed the nuclear programme worldwide.
Japan is now the only country left with a major Fast Breeder programme - but the 300 MW demonstration FBR Monju has been offline since the sodium fire in 1995.
WISE NEWS communique 475 commented: "once the cornerstone of the Japanese nuclear programme, Monju is now symbolic of a Japanese nuclear industry crisis".
The nuclear power lobby may of course seek to use the Kyoto Climate Change Conference in a last ditch attempt to get nuclear power back in the game. Indeed, in what seems to have been a run up exercise, in July more than 50 nuclear experts from the U.S. and Japan met at a conference at the Los Alamos National Laboratory in New Mexico, to discuss the role nuclear energy could play in the growing concern over global climate change. Nuclear power was discussed as being a 'renewable energy source' that does not produce greenhouse gases or acid rain.
The Japanese evidently urged conferees to begin efforts to reinvigorate the nuclear power industry in the United States!
(from Renew 111)
2.1 Detours on the Road to Kyoto
2.2 Oil Industry Reactions
2.3 Hot Air Trading: Joint Implementation
2.1 Detours on the road to Kyoto
In early October, Japan proposed a series of flexible targets for greenhouse gas emission cuts by 2010-with 5% being the top level.
Deputy Prime Minister John Prescot, head of the new UK Department of the Environment, Transport and the Regions commented "I have to say that I am disappointed that the proposed reductions - which I understand would average some three per cent - are well below that which is necessary to tackle the serious problem of climate change. The world will need to do much better in Kyoto and we will certainly be making all efforts to secure a successful outcome."
Greenpeace went further and described Japan's '5% max' proposal as 'an international disgrace' and questioned the right of Japan to host the Summit "if the Japanese government cannot produce a stronger position."
It noted that the Japanese target was "not only small, it would also not be legally binding, and would not have to be met by the majority of countries. Japan's own commitment, for example, would scarcely be a 2.5% reduction. The proposal was minimal compared to the EU's declared target of 15% by 2010 and the Alliance of Small Island States call for industrialised nations to commit to a minimum 20% reduction of C02 emissions by 2005 based on 1990 emissions levels."
The European Commission was also critical Japan's proposals "This is not nearly ambitious enough", said Commission spokesman Peter Jorgensen.
The ultimate aim of the Kyoto meeting was, he said "to protect the climate for present and future generations and the Commission feels that there is absolutely no time to waste," and he added ' I think it is fair to say that the whole world is looking at Japan and awaiting such an initiative,"
The Japanese proposal would let countries like the United States, Japan and Australia cut emissions by much less than five percent and its targets might not be fully binding. Under the proposal, industrialised countries would be able to trim the five percent target further if their 1990 emissions per unit of gross domestic product were less than other developed nations, if their 1990 emissions per capita were lower or if their population growth rate from 1990 to 1995 was higher. Japanese government spokesman Kanezo Muraoka has termed the EU 15 percent proposal "unfair and unrealistic".
Pressure from heavy industry was blamed for Japan's low emissions target.
The USA renegs
Similar pressure was evident in the USA, where a multi million dollar industry campaign was launched to sway public opinion against any radical changes. The Washingtom Times (4/10/97) ran an article warning that President Clinton was considering how to achieve a 20% cut in carbon emissions and that there were proposals for an indirect tax of £25-100 per tonne of carbon, which would raise gasoline prices by as much as 25 cents a gallon and add hundreds of dollars a year to the average homeowner's heating and electricity bills. And this "despite the concern among top advisers that the plan would hurt the economy and cause a political explosion".
The Washingtom Times claimed that a draft study in June by an interagency task force found that a tax on carbon content of $10 per ton could cut economic growth in half by 2005 and cause the loss of millions of jobs in coal mining and other energy-related industries.
The United Mine Workers of America, the conservative Cato Institute think tank and other witnesses told the Senate Energy Committee that the proposed climate treaty could cost the United State more than 1.5 million jobs by 2005, limit the nation's electricity supply, and trim the Gross Domestic Product by up to $17 trillion from 2005 to 2015.
The coal lobby had strong backing: "My own state of Kentucky would be devastated'' said Democrat Senator Wendell Ford, "A climate change treaty that exempts developing countries is an unfair and flawed approach.''
Clinton was clearly under pressure - and the administration evidently decided to back off- and rather than negotiating on new post 2000 targets, it decided to try to get agreement to postpone meeting the existing year 2000 target, of stabilisation at 1990 levels, until 2008-12. A clever move, though even that was seen as too much by the carbon lobby...
The excuse was the claim that the USA simply couldn't meet the year 2000 target. Emissions had risen by 3.4% in 1997, 8% since 1990, and would probably rise by 13% by 2000. But they could try to get back to the 1990 baseline level within at most twelve years, and Clinton allocated $3 billion, mainly in the form of tax concessions, to help. The USA would then try to start cutting back to below 1990 levels. However, this was all conditional on matching support coming from developing countries.
Reactions
The international community was horrified. The Euopean Union saw it as a recipe for an 'environmental disaster'. It came as a particular blow since China seemed to be moving ground. All the complex lobbying efforts now seemed to have been wasted- and the Kyoto negotiations seemed likely to turn into a shambles.
But the lobbyists persevered, with the UK taking a lead: John Prescot was dispatched to the USA, Japan - and also to Australia, which (see our Reviews section), rather than fixed emission reductions, wanted a 'differentiated' approach .
For its part, at the last minute, the European Commission produced a radical new White Paper on Renewables- claiming that a 12% contribution was feasible by 2010, while the Euro Parliament said it would back the EU's 15% CO2 reduction target whatever happened at Kyoto.
2.2 Oil Industry Reactions
Although BP have recognised that Climate Change is an urgent issue (see Renew 109 and 110) most of the other oil companies still remain sceptical. For example in the run up to the Kyoto Climate Conference, Exxon's chief executive commented 'It is highly unlikely that the temperature in the middle of the next century will be significantly affected whether policies are enacted now or 20 years from now', while Mobils view, as presented in a major newspaper advert campaign in the USA, was that 'whatever effect increased concentrations of man-made gases may have, it will develop slowly over decades. Thus, there is time for scientists to refine their understanding of the climate system, while governments, industry and the public work to find practical means to control greenhouse gases, if such measures are called for. Adopting quick-fix measures at this point could pose grave economic risks for the world.'
Shell adopted a somewhat different line. Like BP it is now pushing PV solar (see later) and has accepted that a precautionary approach to climate change was sensible. However, it has focused its attentions not on oil as the culprit, but on the emissions from the 'high carbon fuels' - such as firewood and coal. These it said were significant. According to Shell's U.K. Chairman & Chief Executive Chris Fay, speaking at a CBI ( Confederation of British Industry) seminar on climate change, you could 'burn all the conventional oil and gas in the world- and all we can expect to find - and emissions will still come in well under E.U. recommendations.'
Shell's long-term scenarios (see Renew 110) have carbon dioxide emissions peaking in about 25 years, but at levels far lower than that predicted by other models. This is because, in Shell's view, the use of high-carbon fuels will fall- as it already has. And that process had to be accelerated. So, in effect, Shell is now at war with coal- and the 'carbon club' seems to be fissioning!
CBI Views
Many UK industrialist also seem to be shifting position. Thus the CBI conference also heard the results of a poll which showed that 83 % of the organisation's members supported the European Union's goal of a 15 percent reduction between 1990 and 2010 in emissions linked with global warming. Furthermore, 62% of CBI members believed Europe should unilaterally pursue an ambitious target even if it was not endorsed by the other developed countries.
2.3 Hot Air Trading:
Joint Implementation
If nothing else then proposals for Joint Implementation (JI) projects seem likely to emerge from Kyoto . As we noted in Renew 110, JI is basically a process whereby Western companies invest in environmentally clean technology in developing countries and thereby earn 'pollution credits' under the proposed 'emission trading' system.
As the World Bank noted in a paper on 'Carbon offset by Investment' produced by its Global Environment Division last July, 'the cost of reducing emission are assumed to be relatively cheaper in economies in transition (i.e. the ex-Soviet countries) and developing countries' - presumably since in developed countries most of the cheap and easy emission savings will already have been made.
Certainly new 'green field' projects can be initiated in developing countries, and easy savings can be made. And the prospects for so-called 'hot air' emission trading with the ex-Soviet countries are also significant. Russia is likely to receive an emission budget far in excess of what it needs, given that, as a result of its industrial activity being massively cut back, its emissions are now some 30 per cent below 1990 levels (see our front cover), and its emissions commitment will be set relative to 1990 levels. So it could trade in the non produced emissions ! Hence the 'hot air' term. Indeed it could bank the emissions not produced back to 1990 - the so called 'super heating' option...
I
n the run up to Kyoto, the USA proposed 'hot air' greenhouse gas trading with Russia which could allow an increase in Annex 1 country emissions of 7-11% relative to 1990 levels in 2008-2012. This was vigorously opposed by the European Union and Japan.
However, emission trading and Joint Implementation may not always be a bad idea, after all, it can in principle reduce emissions, and do so at least cost - with the West providing the technology and meeting much of the cost in order to reduce the costs of cleaning up at home. Like any market the 'emission trading' system tends to give power to the powerful, but at least what is being traded is pollution reduction. Loopholes
However, the EU remains opposed to JI, and some critics, like the CAN-UK group, fear that Hot Air Emission trading might provide a loophole which would allow emissions to continue to increase - by up to 15%. Other loopholes include the fact that aviation fuel is exempt from control, and HFC gas had also been left out of the agreements. These loopholes might mean that, despite whatever the headline emission reductions are supposed to be, in practice overall global emissions might increase by 35-40%!
3. Review of OECD Countries Policies
Dean Anderson from the Energy and Environment Programme of the Royal Institute of International Affairs in London has produced a 40 page overview report on 'Progress towards energy sustainability in the OECD countries',(the US, Europe, Australia, Japan etc). It's very comprehensive, covering progress to date in each country on renewables, energy efficiency and transport .
It was prepared initially as part of the Global Energy Observatory (GEO) project but Dean has now also offered it to NATTA and added a specially written conclusion. So we've published it as a NATTA report - £7 from NATTA, £5 to NATTA members. To whet your appetite here's part of the preface and summary.
Progress towards energy sustainability
in the OECD Countries
"In the absence of environmental constraints, alternative sources of energy would, during the coming century, be expected to gradually displace fossil fuels as production of the latter begins to exceed discoveries of new reserves, thus putting upward pressure on prices and reinforcing the market dominance of countries controlling the largest remaining supplies.
The 'penetration' of alternative sources would be expected to gradually accelerate as economies of scale and technological advances improve their economics relative to those of fossil fuels. However, the conclusion is now inescapable that decades before the prices of fossil fuels increase to the point where they affect consumption patterns, global environmental restrictions will have become the main drivers of change. International agreements to reduce sulphur dioxide emissions have been in effect in Europe and North America for a number of years and the UN Framework Convention on Climate Change (UN FCCC), adopted in 1992 at the Earth Summit in Rio de Janeiro, today has over 160 members. Under the auspices of the UN FCCC, an international treaty requiring developed (Annex I) countries to reduce their greenhouse gas (GHG) emissions after the year 2000 is likely to be agreed by the end of 1997.
Since the bulk of GHG emissions are attributable to energy use, government climate change abatement programmes of Annex I countries are primarily focused on reducing CO2 emissions from fossil fuel combustion, improving energy end use efficiency, and reducing the energy intensity of economic activities (they are secondarily focused on increasing the capacity of carbon sinks, such as forests, and reducing non-energy related emissions of CO2, methane, nitrous oxide, and other GHGs).
A lot can be learned about the progress of developed countries in working towards energy sustainability by objectively examining the record of performance of governments in implementing their national climate change programmes. This is especially the case because the UN FCCC requires Annex I parties to submit semi-annual progress reports (national communications) Thus, a major source of the information in this report is the 'national communications' of Annex I parties to the UN FCCC, supplemented by critical analyses of climate change programmes by environmental NGOs, and academics. The other major sources are IEA and OECD publications on energy and the environment.
This report is limited to 22 countries which are members of the Organisation for Economic Co-operation and Development. Iceland and Turkey, though OECD members, are not covered, nor are any other countries which may have joined the OECD in 1996 or 1997.
Summary on Renewables
One needs be careful about generalising too freely, especially when drawing broad normative conclusions about the overall and relative progress of developed countries in moving towards energy sustainability. This is particularly true in regard to energy intensity, which is more a function of a country' resource base and comparative advantage than of conscious energy policy. Canada, the US, New Zealand, and Australia are the most energy-intensive OECD countries (after tiny Luxembourg). Of these the US has the most diversified economy and the most room for ''no regrets' reductions in energy intensity. The others, being more dependent on resource-based industries for export income are limited in what they can do to reduce their energy intensities at no or low cost. Japan, Italy, and Denmark are the least energy-intensive economies, Japan by dint of strenuous efforts to reduce dependence on foreign fossil fuel imports while simultaneously developing the world's most dynamic manufacturing-based export economy. Though Denmark and Italy share Japan's desire to reduce oil imports, their economies have historically been more oriented towards the production and export of agriculture-based and light industrial goods.
Government policies favourable to fuel-switching and supportive of 'new' (non-largescale hydro) renewables R&D and commercialisation are common to all OECD countries, at least since the introduction of climate change programmes, which all OECD countries now have in place. Underlying motivations and the extent of efforts vary considerably, however. Australia has the least serious fuel-switching programme in spite of having substantial natural gas reserves, an ironic situation explained partly by internal politics favourable to coal and partly by the government's desire to maintain Australia's position as the world's leading coal exporter.
As a result, Australia may be unwilling to accept or comply with a climate change protocol requiring OECD countries to reduce their GHG (or carbon) emissions after 2000. At the other end of the spectrum, the UK has since the late 1980s had the world's most aggressive fuel-switching programme, a function of its having substantial gas reserves combined with the Conservative government's desire to end coal subsidies as a free market policy.
In some OECD countries, fuel-switching from coal to cleaner-burning gas is sound environmental policy and will reduce local air pollution while facilitating achievement of the government's climate change commitments in the near- and medium-terms; however, these countries, may in the longer term, replace dependence on oil and coal imports with even more problematical dependence on natural gas, global reserves of which are smaller than those of oil and coal. Dependence on natural gas being unsustainable both economically and geo-politically in the long run, there is a critical (though not generally perceived as urgent) need for OECD countries to use the present and future gas bubble period to make a steady and deliberate transition to 'new' renewables.
This is simply not happening anywhere in the OECD. The US programme, kick-started in the early 1980s by generous subsidies and policies favourable to renewables, died within a decade after oil prices softened and as more optimistic estimates of the extent of global natural gas supplies became accepted.
Even the most aggressive government support programmes - those of the UK, Germany, and Denmark - are very small. Forecasts throughout the OECD of future renewables market penetration levels are modest in the extreme, a few percent at best (except in Denmark, which hopes to get 30% of its electricity from 'new' renewables by 2020). While costs are coming down gradually for most new renewable technologies, the pace of 'cost convergence' with traditional sources is painfully slow, because reductions are coming mainly from technological refinements rather than from the economies of scale which could be realised if the market were growing fast enough to warrant mass production."
On the other sectors, Dean notes that 'In all OECD countries, the least sectoral progress towards energy sustainability is being made in transport.' but that 'The picture is a little better for energy efficiency programmes, which though often a relatively low priority of the governments of OECD countries, do not face as much overt hostility as policies aimed at reducing road travel and private vehicle use'.
THE FULL REPORT CAN BE OBTAINED FROM NATTA FOR £7
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Greenpeace:
http://www.greenpeace.org/kyoto
Climate Action Network: Eco Newsletter http://www.igc.apc.org/climate/Eco.html
Scientists for Global Responsibility: http://www.gn.apc.org/sgr/kyoto/conv.html
and http://www.gn.apc.org/sgr/kyoto/journey.html
Global Commons Institute: http://www.gn.apc.org/gci/frames.html
5. Events at Kyoto... as they unfold...
Final update 22.12.97
After Kyoto
(from Renew 112- forthcoming)
The reactions to the Kyoto agreement were predictable. Most environmentalists saw it as rather pathetic. Greenpeace claimed that 'when all loopholes are considered,(the agreement) will result in no real reductions from 1990 level'.
By contrast William O'Keefe, Chairman of the US based Global Climate Coalition industry lobby said the agreement 'represents unilateral economic disarmament. It is a terrible deal and the President should not sign it. If he does, business, labour and agriculture will campaign hard and will defeat it.'
He went on 'For the first time in history, the United States would allow a foreign body dominated by developing countries to restrict and control the economy of the United States. UN bureaucrats would decide where business would invest, where jobs will be developed. US sovereignty has been surrendered. Since the President believes this is a good deal for America. he should promptly submit it to the Senate for ratification.'
The European reaction was completely different. The European Parliament had already called on the EU to cut its own greenhouse gas emissions by 15% by 2010, regardless of the outcome of the climate change conference in Kyoto- and there has been pressure subsequently to maintain this position.
In a resolution adopted by a large majority, just before the Kyoto Conference started, MEPs urged EU ministers to adopt a "tougher, binding commitment" to reduce greenhouse gases immediately after Kyoto. The call followed the Commission's publication of a policy paper on climate change in which it was stated that "the EU proposal is a negotiating position, not a unilateral commitment." (See ENDS Daily 16 September).
MEPs also called on the Council of Ministers to adopt a" stronger package of measures to meet its 15% target" as rapidly as possible. This should include "fiscal measures - such as an energy tax - to reverse global warming, an increase in the share of renewables to be equivalent to 15% of fossil fuel-derived energy and the removal of legislation contradictory to greenhouse gas emission reduction". The resolution specifically rules out increased use of nuclear power as an option.http://www.europarl.eu.int
However subsequently the line seems to have softened. After the Kyoto Conference was over EU environment commissioner Ritt Bjerregaard welcomed the new Kyoto protocol as and an "important first step" in efforts to reduce emissions of greenhouse gases and argued that the 8% cut based on six gases, as agreed in the protocol, was equivalent to a 13% cut in emissions of the three gases originally proposed by the EU. "The outcome now is close to the original EU position and must be regarded as satisfactory".
For details see http://www.europarl.eu.int
Kyoto-What Next
'The difficulty delegates to the global warming conference in Kyoto encountered in reaching agreement on reducing greenhouse gases is likely to pale beside the trouble Republicans have promised the Clinton administration when it seeks ratification of the newly negotiated international treaty.' So said the Washington Post on the eve of the agreement. It reported that key Senate Republicans had declared the accord "dead on arrival."
That may be to overstate the case, but there is certainly a long way to go before the consensus agreed at Kyoto can be turned into a legally binding agreement. That wont occur until the Treaty is formally signed. It will be available for signature at United Nations headquarters in New York from March 15- and once a country signs, it still has a year to ratify the pact. And there are other ways in which countries like the USA could stall. So it could well be after the next round of negotiations, at COP-4 in Argentina in Nov, before the dust settles on the Kyoto agreement.
Certainly, given the pressure currently being put on him and public opinion by the barrage of anti- Global Warming propaganda, you can see why Clinton might want to stall.
On the other hand the US will be under a lot of international pressure to get on with it. And beyond that, the US might actually miss out on some of the economic benefits that can be reaped from responding to Climate Change. For while the opposition has focused on the costs of cutting carbon emissions, the change in approach can also be seen as offering opportunities..
Dr Phillip Webber, from Scientists for Global Responsibility summed it all up well in a speech at Kyoto, in which he said "Enlightened global corporations see renewables as the future'.
He went on "The US industries' vested interests may in fact constitute another crucial factor in the gradual decline in world influence of the US in geopolitical terms. Much as the USSR clung to an outdated power in the dying days of the Cold War, so now the US clings to its traditional, wasteful and entirely unsustainable ways of life and technology. They simply haven't yet fully realised that being unsustainable means just that - your efforts will fail. One cannot help but be reminded of Honecker' s famous "last words" concerning the Berlin Wall, uttered a few days before the infamous Iron Curtain came down: "It will stand for another 100 years yet. Like Japan, The European Union and the United Kingdom are ready and poised to embrace the world of the future in a new alliance of vision for necessary CO2 emission reductions. The danger for us all, if the US do not act for planetary survival, lies in the fact that their economy will be further damaged in the longer term and that this will further destabilise the world economic system."
Paul Ekins made a similar point in "Green Futures' No. 8: 'Three countries - Germany, Japan and the US- currently dominate the environmnetal technology sector, one of the fastest growing sectors in the old industrial countries. A common factor to all is strict environmental regulation dating back to the 1970's, which stimulated domestic capacity in environmental technologies ahead of other countries. Sizeable trading surpluses have been the result. The US has just walked away from the opportunity to repeat this achievement with the next generation of technologies- energy technologies- which will dwarf the non-energy environmental technologies in importance, simply because energy is at the heart of the economy of every country in the world.'
As of December 11th
NATTA member Dean Anderson sent us a report direct from Kyoto . Here are some edited extracts.
A protocol was UNANIMOUSLY agreed in the end. This means that no parties walked out (as I expected a few would), and no parties expressed objections or even reservations when Raul Estrada, the Chairman of the negotiating body, asked the parties to support his recommendation to the plenary that the protocol, as amended during the final session, be adopted. All the delegations went along, including ones which have clearly been opposed, throughout the two-year process, to a legally binding protocol containing legally binding commitments. The negotiations were very difficult and seemed in imminent danger of breaking down at a couple of points.
The delegates worked to and in many cases beyond exhaustion. Last night's session went all night and just ended at 2PM this afternoon. The previous night's session ran until 4AM. During the night I fell asleep for a few hours. When I woke up, my first observation was the entire room of negotiators struggling to compose a coherent sentence on a relatively non-controversial point, only succeeding after several tries.
In the end, most delegations appeared, at least on the surface, to be satisfied with the final result. There were hand shakes all around. The general view is that the agreement reached is better than no agreement and a step in the right direction.
Targets and timetables:
The Annex I parties, in the aggregate, agreed to reduce their emissions 5.2% from their 1990 levels by 2008-2012. The big three - EU, US, and Japan agreed to reduce their emissions 8%, 7%, and 6%, respectively. The UN FCCC Executive Secretary, Michael Cutajar, stated that the 5.2% figure represents a 10% reduction from the expected 2000 level and a 30% reduction from business as usual projections for the period 1990-2012. (On this basis, the UK's 20% proposal would be a 50% cut! -ed)
The 'differentiators' (those countries which have argued all along for differentiated targets, i.e. lower ones for themselves and higher ones for unnamed other parties), made gains: Australia will be allowed to increase its emissions 8%; Norway 1%, and Iceland 10%. Though these countries never reached agreement on a differentiation formula or differentiation criteria, in the end this didn't matter, as the negotiations over targets turned into a purely political poker game. How Australia managed to pull off an 8% increase is a mystery to this observer, in view of the fact that they never presented a convincing case for special treatment and indeed seemed on the verge of isolation throughout the negotiations.
In the end Russia and the Ukraine agreed to a 0% reduction, which will require no effort on their part to meet, since their emissions are projected to be well below their 1990 level in 2012.
(Most of the the other ex-Soviet states agreed to 8%-ed)
Gases and sinks
The issue of which gases to include and whether or not to include 'sinks' (e.g. for absorbing CO2-ed) was hotly debated throughout the session. In the end the parties opted for, including all six gases, (carbon dioxide, methane, nitrous oxide, HFCs, PFCs, and SF6. This is the 'large basket' favored by Greenpeace and opposed by Japan, which is a major user of PFCs and SF6 in its manufacturing processes. With regard to sinks, in the end a variation of the so-called 'gross-net' approach was adopted.
Emissions trading
The emissions trading provisions did not survive, and the debate over trading, which lasted almost two hours, brought the negotiations to the verge of collapse. It was always known that this would prove to be a decisive issue and perhaps a deal-breaker. The US had made 'flexible mechanisms' (emissions trading and joint implementation) a sine qua non of its negotiating position and climate change policy.
As the debate unfolded, China, India, and a few African states, played brinkmanship by hanging tough against trading. Their view was that trading would amount to a giant loophole, allowing the advanced industrial countries to avoid domestic abatement action by making paper trades with the central and eastern European and former Soviet Union countries. The EU, several AOSIS countries, and several Latin American countries supported it, in spite of sharing this concern. The UK tried to break the impasse by suggesting that language be inserted in the text deferring rule-making on trading until COP-4.
When this failed to win support, Chairman Estrada, simply gaveled an end to the debate, saying that language deferring rule-making on trading would be considered by the UNFCCC plenary outside the protocol. This means that trading will be on the table at COP-4, but not part of the Kyoto protocol.
Joint implementation
JI among Annex I parties survived intact. Language was added stating that guidelines for the implementation of JI will be elaborated at COP-4 (or thereafter). The reason why JI proved less contentious than emissions trading and ultimately acceptable to all parties is that the language concerning JI refers to emission reduction units (i.e. credits) earned from projects aimed at reducing anthropogenic emissions. 'Projects' by definitions means efforts or actions, whereas 'emissions trading' could mean paper trading.
The possibility of joint implementation between Annex I (developed country) parties and non Annex I (developing country) parties remains alive in the form of the 'clean development mechanism'. Following discussions between Brazil and the US prior to the Kyoto, under this scheme, emissions reductions achieved, starting in the year 2000, will be eligible for crediting.
Kyoto Update- as of 5 Dec.
When the Kyoto negotiations finally got underway, Canada announced its proposals- for a 3% cut on 1990 levels by 2010, while New Zealand came out with 5%. By contrast, the German Government's Advisory Council on Global Change recommended an 11% cut by 2005; 23% by 2010; and 43% by 2020, arguing that the EU reduction proposal was inadequate for climate protection.
However, the views of individual countries seemed to count as nothing compared with the power of the carbon club- the Global Climate Coalition industrial lobby. As Greenpeace noted, if company revenues and country GNPs are compared, Exxon and Shell Oil rank higher than 134 of the Parties to the Convention.
But the carbon lobby didn't have a completely free reign. Ex- Environment Minister John Gummer told the Guardian (5 Dec) that "since BP dropped out of the Climate Coalition and announced its support for solar power its share prices had risen. This is an example of how companies could gain from action on climate change."
He added that he thought that companies like Exxon were " failing the free enterprise system and stock-holders should be wary of investing in such backward-looking companies."
In addition, back at Kyoto, a call was made for governments world-wide to introduce global health warnings on all oil and petrol advertising. Speaking at a conference organised by the UNEP Insurer's Initiative, Tessa Tennant of NPI Global Care Investments saw this as a necessary precautionary measure which all governments could readily take.
So far, apart from much debate, for example on whether or not to allow re-afforestation to be included as a carbon emission saving measure, no specific agreements have emerged. There have been suggestions that the USA might shift slightly to join what seems to be an emergent '3% club', but we will have to await the arrival of the ministers before the final positions are clear.
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