Polluting nations reluctant to cut emissions

Developing countries grapple with the collusion of rich nations

International Energy Agency shared early excerpts of the World Energy Outlook 2009 to inform the climate change negotiations leading into Copenhagen that continuing with today’s energy policies would lead to severe climate change impacts. It noted that if right policies put in place promptly, this could help to achieve 450 ppm but some wondered whether it will be adequate.

Meanwhile developing countries are opposed to “the concerted efforts to put the Kyoto Protocol aside. There has to be come comparability between the US and EU commitments. Now there is uncertainty regarding law, scope and nature of commitments, said Shyam Saran, the PM’s Special Envoy on Climate Change in Bangkok. He explained that their proposal for funding sources in the form of assessed contributions from developed countries was based on the experiences of the Group of G-77 and China. He said financing provided through existing institutions outside the Convention has been inadequate and he highlighted the need for a compliance mechanism for monitoring how developed countries implement their financial commitments.

Saran noted that 40% reduction (by developed countries) is a rather reasonable target for 2020. Most missed their targets for the first commitment period. We need significant cuts in the second commitment period. The National Action Climate plan (to cut emissions) sets out national actions and not international obligations.
Historical responsibility is an integral part of determining the equitable basis on which a new climate change relationship can be fashioned. The Kyoto is a valid legal document and the negotiations taking place right now have nothing to do with bringing in another protocol. We are not only focusing on carbon emissions, we have a much broader agenda in terms of climate action plan. We don't see that scale of resources (to fund mitigation measures in developing and least developed countries) being made available. We need to look at the IPR regime to make (climate change) technologies, public good. To talk about any deviation from business as usual and not talk about how this is to be supported by technology and finance is simply not saleable. There are commitments, which have to be undertaken by the developed countries and appropriate actions to be taken by the developing countries. Its not on an equal level.

Supporting the Indian stance, China’s Climate Change Envoy, Yu Qing-tai said that ”Ëveryone is born equal” and it was “politically and morally incorrect and unacceptable” that someone who was born Chinese had only a limited entitlement to atmospheric space. There is a concerted effort to put an end to Kyoto Protocol. It is clear that our partners in developed world are not interested in entering into serious discussions on targets for emission reduction".

New multilateral institutions on the lines of the World Bank to manage funding for countries to adapt to gobal warming should not be “donor-driven, to reflect the priorities of the donor community. We are talking about entitlements, not aid," Saran said.

He cited a German colleague saying, “Some 60-70% of such technologies are already available,” he said. “We need a zero-tariff regime on these and eco-friendly goods.
There was an ëxtraordinary responsibility”to spread these technologies as well as a global mechanism to adapt them to different regions, which is why India was advocating regional innovation centres."

Venezuela has emphasized that “99% of the text” reflects proposals by developed countries on market mechanisms and stressed that the text should better reflect proposals by developing countries. South Africa, China and India, Venezuela and Singapore stressed that this subparagraph of the BAP addresses “various approaches,” not just markets.

The US noted that it is uncertain “what the configuration of Copenhagen might be regarding the fate of the Kyoto Protocol” and suggested addressing such uncertainty by adding language that: “the COP shall take decisions necessary to enable the applicability of the CDM under this agreement.”

Algeria noted that countries wishing to use the CDM could ratify the Protocol.
The EU clarified that their intention is “not to step away from the Protocol,” but to build on it. It explained that their preferred outcome from Copenhagen would be an integrated instrument that incorporates key elements from the Protocol, including:
binding QELROs; robust reporting consistent with Protocol Articles 5, 7 and 8; strong compliance; and the flexibility mechanisms. It stressed the intention to: strengthen the legally binding framework for all parties; retain the CDM; and integrate new market mechanisms as voluntary tools for developing countries to engage in cost-effective mitigation. He noted efforts by the EU, the Republic of Korea, New Zealand and others to consolidate their proposals on new mechanisms and provide streamlined text.

Brazil stressed that for his country, the continuity of the Protocol is one of “the key aspects of the Copenhagen outcome” and noted that selectively picking elements from the Protocol would weaken the entire regime.

India has proposed the establishment of a new financial mechanism under Convention Article 11 (financial mechanism). It said only funding channeled through the financial mechanism should count towards the fulfillment of Annex II parties’ financial obligations. Japan and US cautioned against creating new bureaucratic
organizations, noting the need to reconsider the role and scope of the existing funds under the Convention and Protocol in order to avoid duplication. US clarified that their proposal for a global climate fund envisaged new arrangements and not the
creation of a new institution.

G-77 and China stressed that the group’s mandate is to consider the “full, sustained and effective implementation of the Convention,” particularly implementation of Convention Articles 4.1(c) and 4.5 (technology transfer) and urged parties not to
digress from this mandate.

China and India stressed the importance of deep emission reductions by Annex I parties in the second commitment period for “a strong and robust carbon price.”
INDIA warned that the proposed new mechanisms would “flood the market” with cheap credits. China identified the need to define the concept of supplementarity to avoid “mainstreaming” offsetting, specifying that the figure can be further discussed but that it should be below 50%. India proposed that caps on the use of offsets could be scaled according to Annex I countries’ circumstances, such as historical responsibility or sustainable lifestyles.

Interestingly, Norway, the Russian Federation, New Zealand noted that where emission reductions take place is irrelevant for the atmosphere. While the EU recognized the importance of supplementarity and domestic action, it emphasized the role of mitigation potential in determining the amount of emission reductions to be achieved through offsetting, and identified the need to “let the market play.”

Heated discussions on the fate of the Kyoto Protocol also surfaced during the day both in contact groups and in informal consultations. Some of those participating in the AWG-LCA subgroup on various approaches to mitigation commented on the
proposal by the US to introduce language that would include the CDM in an agreement reached under the AWG-LCA. “The US interest in the CDM is obviously welcome news,” remarked one delegate. “I am increasingly worried about the Protocol,” said
another: “If we start discussing the CDM under the AWG-LCA, it means that the AWG-KP will just die - and I don’t want the blood of the Protocol on my hands,” he explained. “It seems that many developed countries are ready to finish off the Protocol,” opined another.

The divide between developed and developing countries on the fate of the Protocol became more evident under the AWGKP in the evening when a small group convened to discuss the legal implications of the Protocol being submerged under a new agreement. Several developing countries stressed that the question was political rather than a legal one, and opposed any discussions implying that the Protocol would cease to exist in the future. Several developing country delegates, in fact,
reportedly walked out of the meeting after expressing this view.

The financial and economic crisis has led to delay in the investments in polluting
technologies. Consequently, CO2 emissions is expected to fall in 2009 by as much as
3% - steeper than at any time in the last 40 years, finds the International Energy
Agency's new study. This would lead to emissions in 2020 being 5% lower – even in the
absence of additional policies -- than the IEA estimated just twelve months ago. The
economic downturn has thereby created an opportunity to put the global energy
system on a trajectory to stabilise greenhouse gas emissions at 450 parts per million
(ppm) of CO2-equivalent, in line with an increase in global temperature of around 2
degrees Celsius.

The IEA 450 ppm Scenario sees the use of fossil fuels peak before 2020, and energyrelated CO2 emissions just 6% higher in 2020 than in 2007. Relative to a Reference Scenario of current policies, emissions in 2020 would need to be reduced by 3.8 gigatonnes (Gt) worldwide to achieve the 450 Scenario. 1.6 Gt of this reduction occurs in OECD countries, while policies and measures in China – already being considered by the Chinese government – account for 1 Gt of emissions reductions, more than anywhere else. This underlines the leading role China will play in the global combat against climate change.

To achieve this energy revolution, incremental investment of USD 10 trillion will be
necessary between 2010 and 2030 in the energy sector - equivalent to 0.5% of global
GDP in 2020, rising to 1.1% of GDP in 2030. Yet fuel savings across industry,
transport and buildings total USD 8.6 trillion between today and 2030, similar to the
additional investment in these sectors.

In 2020, the energy sector in non OECD countries would need to make USD 200
billion of extra investments in clean power, energy-efficiency measures in industry
and buildings and next-generation hybrid and electric vehicles. For this, developing
countries will need some financial support from OECD countries. OECD domestic
investment needs amount to a further USD 215 billion in 2020. But the benefits, in
terms of energy savings, reduced fuel imports and air quality improvements offset
much of this extra cost, not to mention the fact that this will help to avoid extreme
climate change.

The IEA 450 scenario is the energy pathway to Green Growth. Yet we need to act urgently and now. Every year of delay adds an extra USD 500 billion to the investment needed between 2010 and 2030 in the energy sector.

The WEO-2009 excerpt sets out, for key countries and regions (including the United
States, Japan, the European Union, Russia, China and India), the energy
transformation that each might undertake, sector by sector, if the world were to adopt a 450ppm trajectory. It also describes the current trends in energy use and emissions in a fully updated Reference Scenario, detailing the implications of current policies.

The entire WEO 2009 will be launched in London on 10 November 2009 and contains
substantially more climate analysis and provides a comprehensive set of results, by sector and by region, for both the Reference Scenario and the 450 Scenario, and analyses the international financial flows and mechanisms that might underpin a post-2012 agreement.