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June 27, 2007
By Joanna Lewis, Senior International Fellow
This article originally appeared in Chief Brief
China released its much anticipated National Climate Change Program report on June 4, 2007 . This plan comes at an important time, as nations are debating next steps in the international climate effort and China has likely just become the largest greenhouse gas emitter in the world . The majority of the policies described in the plan were already in place, and they cannot achieve the emissions reductions that will eventually be needed from China to make a serious contribution to the global challenge. Nevertheless, China’s climate challenge is considerable, and its efforts to date should not go unrecognized. The plan is significant, furthermore, in that it indicates that climate change has now captured the attention of political leaders within the largest developing country emitter of greenhouse gases.
China’s Climate Change Challenge
The Coal Challenge – China’s greenhouse gas emissions are growing very rapidly (reportedly up by nine percent in 2006 from 2005 levels), and much of this growth is fueled by the country’s heavy reliance on coal. Coal has been China’s answer to domestic energy security; its substantial resource base and relatively low cost has made China the largest global coal consumer and producer in the world. As a carbon-intensive fuel, coal contains almost twice the amount of carbon per unit of energy compared to natural gas, and about 20 percent more than petroleum. China relies on coal for over two-thirds of its energy needs as well as approximately 80 percent of its electricity needs. In fact, there are more coal power plants installed in China than in the United States, the UK and India combined. China’s coal fleet is expected to more than double in size by 2030, representing an additional carbon commitment of about 86 billion tons . Changing China’s emissions trajectory will require either a substantial shift away from coal or massive investments in capturing the CO2 emissions from coal-based energy sources.
The Industry Challenge – The majority of China’s energy use, and consequently greenhouse gas emissions, stems from industry. Industrial energy demand consumes 70 percent of China’s energy, and China’s industrial base supplies much of the world. For example, China today produces 35 percent of the world’s steel and 28 percent of aluminum, up from 12 percent and eight percent, respectively, a decade ago . It is increasingly difficult for China to rein in its greenhouse gas emissions growth as investment surges continue in heavy industry, a key component of China’s economic growth.
The Energy Intensity Challenge – Between 1980 and 2000, China quadrupled its gross domestic product (GDP) while only doubling its energy demands—an unprecedented achievement for a developing country. Without this reduction in the energy intensity (energy use per unit GDP output) of the economy, China would have used over twice the energy it did during this period. Between 2002 and 2005, however, this trend reversed and energy growth surpassed economic growth for the first time in decades.
Climate Action in China
China has ratified the primary international accords on climate change—the United Nations Framework Convention on Climate Change (UNFCCC) and the Kyoto Protocol—but as a developing county, China has no binding emission limits under either accord. China is, however, an active participant in the Clean Development Mechanism (CDM) established under the Protocol. The CDM grants emission credits for verified reductions in developing countries, which can be used toward meeting their Kyoto targets. This provides lower-cost reductions for developed countries and generates investment in clean development in developing countries. China is by far the largest source of CDM credits, accounting for over 40 percent of those generated to date .
The vast majority of the efforts that have served to moderate China’s greenhouse gas emissions growth have come in the form of domestic programs that are not climate policies per se, but policies implemented throughout the economy, and particularly in the energy sector, that have the effect of reducing greenhouse gas emissions. Many of these policies are enacted to help the country meet its broader economic development strategies, and if implemented effectively, will also serve as policies to mitigate China’s greenhouse gas emissions.
With the hope of achieving a similar energy intensity improvement between 2000 and 2020 as it did during the previous two decades, China has a broad national goal of quadrupling economic growth while doubling energy consumption . China’s 11th Five-Year Plan includes a near-term goal of reducing energy intensity 20 percent below 2005 levels by 2010. The government projects that meeting this target could reduce China’s greenhouse gas emissions by 10 percent below the status quo; researchers estimate that over 1.5 billion tons of CO2 reductions would be achieved . Implementation of such central government targets has proven challenging, particularly at the local level. In an attempt to improve local accountability, the National Development and Reform Commission (NDRC) is allocating the target among provinces and industrial sectors, and energy efficiency improvement is now among the criteria used to evaluate the job performance of local officials. Following increases in energy intensity each year from 2003 to 2005, the trend was reversed in 2006, although the intensity decline achieved was short of the goal for that year .
Additional programs have been established to help meet this national intensity goal, including a program established in 2006 to improve energy efficiency in China’s 1,000 largest enterprises. The “1,000 Enterprise Program” includes the largest energy users in the energy supply sectors (coal, electricity and oil) and in the largest energy-using industrial sub-sectors (including iron and steel), which comprised 33 percent of national and 47 percent of industrial energy usage in 2004 . Another government effort targets the elimination of 50 gigawatts (GW) of small, inefficient power plants, totaling around eight percent of China’s total generating capacity, by 2010—approximately 40 GW of coal-fired and 10 GW of fuel oil-fired capacity (PlanetArk.com, February 1). Similar plant closings are planned across the industrial sector, including inefficient cement, aluminum, ferro-alloy, coking, calcium carbide and steel plants (PlanetArk.com, March 2; PlanetArk.com, March 5).
In addition, the 1997 Energy Conservation Law initiated a range of programs to increase energy efficiency in buildings, industry and consumer goods. China has efficiency standards and labeling programs in place for many key energy-consuming appliances and is adopting energy standards for buildings in regions with high heating and cooling demands. In the transport sector, China’s fuel economy standards for its rapidly growing passenger vehicle fleet are more stringent than those in Australia, Canada and the United States (though less stringent than those in the European Union and Japan) . The average fuel economy of new vehicles is projected to reach 36.7 miles per gallon in 2008.
Under the National Renewable Energy Law adopted in 2005, China has set a target of producing 16 percent of its primary energy from renewable sources (including large hydropower) by 2020, up from about seven percent at present. For the electricity sector, the target is 20 percent of the capacity from renewables by 2020, including 30 GW of wind power, 20 GW of biomass power and 300 GW of hydropower capacity. The Law offers financial incentives, such as a national fund to foster renewable energy development and discounted lending and tax preferences for renewable energy projects. It also reduces risks for project developers by mandating grid interconnection and guaranteeing minimum prices for certain types of renewable energy. Large-scale hydropower capacity is projected to more than double by 2020, requiring the equivalent of a new dam the size of the Three Gorges Project every two years.
Policies to promote renewable energy also include mandates and incentives to support the development of domestic technologies and industries, for instance, by requiring the use of domestically manufactured components. Spurred by a requirement that newly installed wind turbines contain 70 percent local content, Chinese manufacturers are now producing about 40 percent of the wind turbines being sold in China and three percent of the wind turbines being sold globally. Tax and other incentives have targeted the solar photovoltaic (PV) industry, stimulating a six-fold growth in PV production from 2004 to 2005. A recent market study estimates that the Chinese PV industry will dominate the global market within five years; China is currently the third largest producer of solar photovoltaics for the global market (Solarplaza.com, March 7, 2006).
Industrial Policies – The recent surge in energy consumption for heavy industry in China has caused the government to implement measures to discourage growth in energy-intensive industries compared with less energy-consuming sectors. In November 2006, the Ministry of Finance increased export taxes on energy intensive industries. This includes a 15 percent export tax on copper, nickel, aluminum and other metals, a 10 percent tax on steel primary products and a five percent tax on petroleum, coal and coke. Simultaneously, import tariffs on 26 energy and resource products, including coal, petroleum, aluminum and other mineral resources, will be cut from their current levels of three to six percent to between zero and three percent (China Daily, October 31, 2006).
Climate Change – With growing political attention addressing climate change, the Chinese government released its first National Assessment Report on Climate Change in late 2006. The assessment was conducted as a collaborative effort between nine government departments, which included the Ministry of Foreign Affairs, the National Development and Reform Commission, the State Environmental Protection Administration, the Ministry of Science and Technology, the China Meteorological Administration and the Chinese Academy of Sciences; it took four years to complete . Structured similarly to the assessment reports of the Intergovernmental Panel on Climate Change (IPCC), the Chinese assessment consists of three parts: the past and future of climate change, the impact and adaptation of climate change and the socioeconomic impact from the slowdown of climate change.
Following this National Assessment, the government released its National Climate Change Program in June 2007, delayed from a previously announced release date . The National Climate Change Program report lays out an array of actions that China is taking to mitigate its greenhouse gas emissions, as well as its plans to support adaptation to the reported impacts it is likely to face from a changing climate. According to the report, regional administration systems are being established to better coordinate work dealing with climate change, energy efficiency and renewable energy across agencies. Also announced in the plan was the establishment of a high-level “National Leading Group on Climate Change,” headed by Premier Wen Jiabao. While the plan establishes several specific targets and timetables for policy action, almost all of these were in place before the release of the plan, including those previously mentioned.
Engaging China on Climate Change
As the aforementioned policies and targets illustrate, China is taking significant domestic action that serves to moderate its greenhouse gas emission growth. Certainly, much work remains to be done. Recognition of China’s achievements to date and a better understanding of the nature of its domestic policy agenda on climate change, however, can inform the upcoming international climate negotiations.
In the view of developing countries, absolute greenhouse gas targets like those under the Kyoto Protocol amount to a cap on their economic growth. China’s intensity-based targets illustrate the importance of a metric that includes not just absolute energy use but the efficiency of economic growth, an indicator that is particularly important to developing economies as formerly discussed. China’s climate plan has also laid out an array of domestic policy activities. Such policies could form the basis of a policy-based commitment made under the UNFCCC . Policy commitments as part of a multilateral climate agreement could allow developing country governments to identify ways that emissions mitigation fits or advances national priorities such as economic growth, energy security and public health, while such commitments would help to achieve broad participation in an international effort to reduce greenhouse gas emissions.
It is important that the international community increase collaboration with China surrounding shared energy and environmental concerns. Recognizing the unique challenges that China faces in addressing climate change can help in designing a roadmap for international engagement. China’s own climate change plan has clearly identified its priority areas for international collaboration, including cooperation on advanced coal technologies, energy efficient building technologies, clean vehicle technology and advanced industrial technologies . Experience developing and deploying these technologies is important not only for China but for the other major emitters as well. The United States and China in particular share a common interest in determining a way to continue their reliance on coal while moving toward more efficient coal combustion and gasification technologies, and by capturing and storing the emissions from coal power plants.
China must be a part of any global solution to address climate change. Understanding the challenges China faces in addressing its own greenhouse gas emissions is the first step to engaging China on climate cooperation. Effective engagement with China, however, will only be possible if the major emitting developed countries lead by example. Most crucial to China’s engagement is likely to be serious U.S. engagement. It is incumbent upon the United States to lead both by strong action at home and by actively and constructively reengaging in the international climate effort. Only with strong U.S. participation and leadership can a fair and effective global response to the critical challenge of climate change be achieved.
1. National Development and Reform Commission, People’s Republic of China, June 2007. “China’s National Climate Change Programme.” Available online at: www.c2es.org/docUploads/ChinaNationalClimateChangeProgramme%20June%2007.pdf.
2. Netherlands Environmental Assessment Agency, June 21 2007. “Global fossil CO2 emissions for 2006.” Available online at: www.mnp.nl/en/dossiers/Climatechange/moreinfo/Chinanowno1inCO2emissionsUSAinsecondposition.html.
3. U.S. EIA, 2006 International Energy Outlook. Available online at: www.eia.doe.gov/oiaf/ieo/coal.html.
4. Houser, Trevor. Testimony before the U.S.-China Economic and Security Review Commission. “China’s Energy Consumption and Opportunities for U.S.-China Cooperation to Address the Effects of China’s Energy Use.” June 14, 2007. Available online at: www.uscc.gov/hearings/2007hearings/written_testimonies/07_06_14_15wrts/07_06_14_houser_statement.pdf
5. UNEP Risoe, CDM Pipeline. Updated May 2007, Available online at: cdmpipeline.org/publications/CDMpipeline.xls.
6. State Council Development Research Center, 2003. China’s National Energy Strategy and Policy 2000-2020. Available online at: www.efchina.org/documents/Draft_Natl_E_Plan0311.pdf
7. Lin, Jiang; Nan Zhou, Mark Levine and David Fridley. “Achieving China’s Target for Energy Intensity Reduction in 2010: An exploration of recent trends and possible future scenarios.” Report #61800, December 2006, Lawrence Berkeley National Laboratory.
8. Intensity declined 1.23 percent in 2006, short of the goal for that year of 4 percent. “Nation unlikely to meet energy efficiency goal” (China Daily, December 18, 2006; People’s Daily, March 5).
9. China National Development and Reform Commission, 2006. Available online at: hzs.ndrc.gov.cn/newzwxx/t20060414_66220.htm.
10. Feng, A. & Sauer, A., 2004. Comparison of Passenger Vehicle Fuel Economy and GHG Emission Standards around the World. Prepared for the Pew Center on Global Climate Change. Available online at: www.c2es.org/global-warming-in-depth/all_reports/fuel_economy/index.cfm.
11. Zhongguo Qihou Bianhua Guojia Pinggu Baogao Bianxiezu, 2006. “Zhongguo Qihou Bianhua Guojia Pinggu Baogao.”
12. The press widely reported that China would release its National Climate Change Plan on April 24, 2007, however the release of this plan was delayed, likely due to political concerns surrounding wide media reports that China was about to become the world’s largest greenhouse gas emitter. (Financial Times, April 23).
13. Lewis, Joanna and Elliot Diringer. “Policy-Based Commitments in a Post-2012 Framework.” Pew Center on Global Climate Change, May 2007. Available online at www.c2es.org/docUploads/Policy-Based%20Commitments%20in%20a%20Post-2012%20Climate%20Framework.pdf.
14. National Development and Reform Commission, People’s Republic of China, June 2007. “China’s National Climate Change Programme.” Available online at: www.c2es.org/docUploads/ChinaNationalClimateChangeProgramme%20June%2007.pdf. See also Lewis, Joanna I., Michael B. Cummings and Jeffrey Logan. “Understanding the Climate Challenge in China,” in Steven H. Schneider, Armin Rosencranz, and Michael Mastrandrea, eds., Climate Change Science and Policy (forthcoming in 2007).
SPEECH BY EILEEN CLAUSSEN, PRESIDENT, PEW CENTER ON GLOBAL CLIMATE CHANGE
AMERICAN COLLEGE AND UNIVERSITY PRESIDENTS CLIMATE COMMITMENT SUMMIT
June 12, 2007
Thank you. I am very happy to be here and to welcome many of you to Washington. I don’t know if you saw it, but there was a recent report stating that Washington and other eastern U.S. cities will reach summer temperatures of 110 degrees over the next 50 years. In a related story, Washington is considering a new license plate slogan: Perspiration Without Representation.
And the interesting thing is we’re already seeing evidence of a changing climate in this part of the country. More and more species from the deeper South are making their presence known here in Washington, like crape myrtles and camellias, and a telegenic former Republican Senator from Tennessee. Think it’s a coincidence that our last two presidents are from Arkansas and Texas? They’re moving north, I tell you.
It’s gotten so bad that many people actually welcome a new Cold War with Russia. They think it will keep a lid on global warming. And now a congressman has been caught with money in his freezer. What better way to keep cool during a hot Washington summer than to slip an ice-cold hundred-dollar-bill into your pocket?
All joking aside, it is an honor to be here at your first Leadership Summit. I am delighted to see so many of the nation’s leading colleges and universities make the commitment that your institutions are making—you have set out to be a part of the solution to climate change, not a part of the problem. And I am certain that your leadership on this issue will inspire others to do their part as well.
Today, I want to use my remarks to talk about leadership and climate change. In my view, leaders are those who help us understand, in the words of the English biologist Thomas Huxley, that “the great end of life is not knowledge but action.” They help us see when the time has come to do something based on what we know about a challenge or about an opportunity that lies before us. Yes, aspiring to a fuller understanding of our world is to be admired. It helps to focus our attention, and to pinpoint our actions. But waiting for perfect knowledge is cowardice, not leadership.
Moving from knowledge to action. From what we know to what we must do. This is what I want to talk with you about today. And I want to start with a brief summary of what we know about the scope of the climate crisis and how to solve it.
Let’s start with the science. Most of you are familiar with the facts by now. The most recent report from the Intergovernmental Panel on Climate Change projected that global temperatures will increase between 3.2 and 7.2 degrees Fahrenheit by 2100. Sea levels will rise by as much as a foot to a foot-and-a-half. Many species will be lost. In addition, there is a 90-percent or greater chance that the world will see more hot extremes, heat waves and heavy precipitation events. And it is likely we will see more droughts as well.The science, in other words, is clear: if left unabated, climate change will have tremendous negative consequences for our country and our world.
The science also tells us there is no longer any doubt about what is causing this problem: greenhouse gas emissions from human sources—and, more specifically, from three key sectors: electricity; transportation, primarily automobiles; and buildings. Consider this: China is building a new coal-fired power plant every week to 10 days. And it’s not just China and other developing countries. Emissions have been growing in the U.S. as well—as of 2006, they were up nearly 18 percent compared to 1990.
This is what we know about the science, and it seems we are learning more every day. And we also know something else. We know there are solutions—real technologies that can deliver real reductions in greenhouse gas emissions. We know, for example, that we can reduce carbon dioxide emissions from cars. We know there are clean energy sources. We know there are ways to burn coal more efficiently, and ways to potentially store coal-related carbon emissions underground. And we know we can increase efficiency in the building sector.
But still there’s the same problem: we haven’t yet put all this knowledge we have to good enough use. And that, I believe, is where policy comes in. We need strong policies at the national and international levels, policies that make it absolutely clear that continuing with the status quo will have both an environmental and an economic cost.
In weighing what types of policies we need, I believe it’s important to look back at where we’ve been. Because in the same way that we know from the science that we need to take strong action to protect the climate, we know from history what policies will and won’t work.
The global effort to try and address this problem kicked off in 1992, you will recall, when another President Bush was in the White House, and when the nations of the world gathered in Rio de Janeiro for what was billed as the Earth Summit. This was the event where more than 150 countries signed an agreement called the United Nations Framework Convention on Climate Change.
The UNFCCC, as it is known, sets an ambitious long-term objective: to stabilize greenhouse gas concentrations in the atmosphere at a level that would – and I quote – “prevent dangerous anthropogenic interference with the climate system.” This is a goal that the United States, and virtually every other nation, has embraced.
As a first step to achieving this goal, industrialized countries agreed to a voluntary emissions target: they aimed to reduce their greenhouse gas emissions to 1990 levels by the year 2000. But before long, it became clear that the targets would not be met and that voluntary commitments could not deliver what was needed. So the United States and other countries began to negotiate a new agreement, one with binding targets, and they agreed at the outset that these new commitments would extend only to the industrialized countries, which so far have contributed the most to the problem.
Remember: this was more than 10 years ago, and already the world, including the United States, had recognized some very important things about responding to climate change. First, we recognized that voluntary action was not sufficient. Second, we recognized that we needed a global framework with binding commitments. And third, we recognized that, consistent with the Framework Convention, the developed world would have to take the lead.
Well, how quickly some of us forget.
Five years after the Rio summit, there was another international gathering on this topic in Kyoto, Japan. This was where the United States and other countries signed the new agreement known as the Kyoto Protocol. And what the Protocol did was to require developed countries to reduce or limit their emissions of greenhouse gases in relation to 1990 levels, with different countries agreeing to different targets. The agreement also included a number of features advocated by the United States to ensure countries a high degree of flexibility as they worked to achieve their targets. They could make actual emission reductions at home, buy emission credits from others, and use “sinks” such as farms and forests to remove carbon from the atmosphere.
This was another important principle that would serve us well to remember today: the need to combine binding commitments with flexible ways of achieving them.
During the negotiations in Kyoto, Vice President Al Gore flew to the ancient Japanese capital to help hammer out the deal. And the American negotiators ultimately agreed to a binding 7-percent reduction in U.S. emissions below 1990 levels by 2012.
But there was a problem: It was 1997, and U.S. emissions had already risen over 1990 levels by more than 8 percent. In other words, we had pledged to reduce our emissions by nearly 15 percent and we didn’t have any kind of program in place to do this, nor did we have the political will to put such a program into place.
Another problem was that the United States Senate, under the Byrd-Hagel resolution, had already voted unanimously—unanimously—that the United States should not sign any climate treaty that–quote–“would result in serious harm to the economy of the United States.” The resolution also put the Senate on record against requiring the United States and other developed countries to reduce emissions without also mandating—quote—“specific scheduled commitments … for Developing Country Parties within the same compliance period.”
So the fact of the matter is that the Kyoto Protocol had virtually no proponents on Capitol Hill. And the Clinton administration did next to nothing to try to bring about the ratification of this treaty that its people had made such a big deal of signing. We clearly were not prepared to deliver at home what we were promising abroad. Not a sterling example of leadership, I must say.
And then, in 2000, American voters elected another President Bush, and within months of entering office, his administration made a unilateral decision to reject the Kyoto Protocol—not to modify it, not to explain the changed circumstances, not to suggest an alternative, but to reject it out of hand. And in taking this step, the White House raised the ire of other nations that had persevered through years of difficult negotiations and that had acceded to U.S. demands early on that the treaty include emissions trading and other business-friendly mechanisms.
It took the Bush administration fully six years to put forward any kind of alternative to Kyoto, as it did in the run-up to the G8 meeting last week. And, adding insult to injury, the President’s proposal completely disregarded much of what we thought we had learned about how to spur effective global action on this issue—most importantly, the need for binding commitments that will truly change the world’s emissions growth path.
That, my friends, is not leadership. For a glimmer of real leadership, you have to look to the other end of Pennsylvania Avenue, where Congress is devoting an unprecedented amount of energy to developing legislation that would (finally) put the United States on track to addressing this issue in a serious way.
Already this year, there have been more than 70 hearings on the climate issue on Capitol Hill—serious, substantive hearings convened to help members of Congress draft mandatory climate legislation. In the U.S. Senate alone, there are five bills proposing some form of cap-and-trade program for greenhouse gas emissions, and a total of 80 bills that deal in some way with the climate change issue. And the leadership of the House has made it clear that they want to pass legislation as soon as possible.
I have given entire speeches this year on what’s happening on this issue on Capitol Hill, and I don’t want to do that here. But suffice it to say that Congress is taking this issue very seriously, and we may, in fact, see real climate legislation by 2008, and if not by then, almost certainly by 2010.
But, for real action on this issue, real effort to reduce emissions, you need to travel outside of Washington.
You can find leadership in Bentonville, Arkansas, for example, where executives at Wal-Mart have launched a program to reduce their company’s greenhouse gas emissions. And what is extraordinary about Wal-Mart’s entree to the climate arena is the magnitude of the company’s reach. Wal-Mart has pledged to work to reduce its emissions, both internally and externally, and the company’s external reach encompasses more than 40,000 suppliers. The ability of Wal-Mart to transform the debate and reduce energy use and emissions cannot be matched by most countries.
Among the company’s goals: reducing energy use in Wal-Mart stores by 30 percent, with a corporate goal of eventually being fueled 100 percent by renewable energy. Wal-Mart also is working to reduce the carbon footprint of its vehicle fleets. Wal-Mart operates 3,300 trucks. In 2005, these vehicles drove 455 million miles to make 900,000 deliveries to 6,500 stores. Wal-Mart has set a goal of doubling the fuel efficiency of its new heavy-duty trucks from 6.5 to 13 miles per gallon by 2015, thereby keeping some 26 billion pounds of carbon dioxide out of the air between now and 2020.
You can also find leadership on climate change in Fairfield, Connecticut, home to a little company called GE. As part of its Ecomagination initiative, GE has committed to doubling its investment in environmental technologies to $1.5 billion by 2010. This is the equivalent of starting a new Fortune 250 company focused exclusively on clean technology.
And you can find leadership in Sacramento, California. Not content with establishing an ambitious set of greenhouse gas emission targets—such as reaching 1990 levels by 2020—California lawmakers have gone the next step and passed legislation, with real enforcement, to give the targets the force of law.
Of course, California is not the only state to be exercising a leadership role on this issue. For example, 24 states, including large emitters like Texas, have required that electric utilities generate a specified amount of electricity from renewable sources. Twenty-eight states have climate action plans. And many states are working across their borders to reduce emissions in a cooperative way.
California and five other western states, for example, have agreed on a regional target for greenhouse gas emissions. By August 2008, the states will establish a market-based system to enable companies and industries to meet the target as cost-effectively as possible. A similar effort including 10 Northeastern and Mid-Atlantic states is aimed at reducing carbon dioxide emissions from power plants in the region.
And then there are 522 mayors representing 65 million Americans who are aiming to reach the U.S. Kyoto target of a 7 percent reduction below 1990 levels by 2012.
That is leadership. And we can also find leadership on the campuses of the colleges and universities that all of you represent. There are wonderful stories on the Presidents Climate Commitment website about colleges and universities reducing their emissions in real, tangible ways.
However, despite all the great things you are doing on your campuses, and despite the leadership of the states, cities and businesses I have mentioned, U.S. emissions still are trending up not down. Voluntary action is great, but it is not enough.
We need mandatory policies that will light a fire under what’s happening now to address this issue, policies that will take us to another level of action and commitment. In the view of the Pew Center, what we need more than anything else is an economy-wide cap-and-trade system. This is when you place a cap on emissions and allow companies to achieve their targets either by reducing emissions outright or by purchasing emission credits from others who may be able to do it more cheaply.
Cap-and-trade, in fact, is the focal point of an effort involving the Pew Center and other NGOs, along with a number of leading companies. The group, which now numbers 27, is known as the U.S. Climate Action Partnership (USCAP for short), and we have issued a cap-and-trade proposal with specific targets and timetables—a real plan of action to slow, stop and reverse U.S. emissions. In addition to cap and trade, the USCAP group embraced an array of other policies aimed at building a low-carbon energy economy.Another example of leadership.
Another example of people and organizations making the shift from knowledge to action on this issue.
But whether we are talking about USCAP, or about what is happening in the states—or, indeed, about the things you are doing on your college and university campuses—the leadership ranks on this issue remain far too thin. And this is where you come into the picture in your role as educators.
Responding to global climate change will be a decades-long challenge. We know a great deal about how to get started solving this problem right now, as I have said. But we still need to learn more. We need to learn more about how to develop and deploy new, low-carbon technologies around the world. We need to learn more about what types of policies will drive technology development. And yes, we need to learn more about the science of climate change so we can refine our understanding of exactly what’s happening, and what it will take to avert and adapt to this crisis.
Your institutions will be the places where much of this learning takes place. America’s colleges and universities are the incubators for the next generation to lead the climate fight. It is crucial that you lead by example through efforts to limit your own emissions. And it is crucial that you educate your students about what you are doing—if only to show them that progress is possible. But even more crucial is that you make sure this next generation is able to gain the knowledge it needs to act on an issue that will have a profound impact on their lives and on the world they inherit from us.
Climate change is an issue that touches on science, policy, technology, ethics, international relations and other fields of study. That means encouraging a multidisciplinary approach to the study of climate change. It means enabling students and professors to work across the disciplines so they can see how all the pieces fit together. It means creating new majors, new academic programs that enable students and professors alike to give this topic the attention it deserves. It means following the words of the Presidents Climate Commitment that all of you have signed by—I quote—“integrating sustainability into the curriculum.”
And it also means looking at what you can do outside the classroom to educate your students and others—by facilitating and encouraging dialogues on this issue on your campuses.
“Education is not the filling of a pail, but the lighting of a fire,” said the poet William Butler Yeats. We need to light a fire in this next generation so they can see the urgency of this issue, explore solutions, speak out for action, and act.
Today, I am pleased that the climate debate has moved from focusing on what we know to what we must do. Now, the challenge is to build a common understanding among the young and not-so-young alike …. a common knowledge of what it is going to take to address this enormous problem … and a shared sense of responsibility on the part of today’s—and tomorrow’s—leaders.
Meeting this challenge will take perseverance, and yes, a certain amount of perspiration as well. But I believe we are up to the task. Thank you very much.
Statement by Elliot Diringer, Director of International Strategies, Pew Center on Global Climate Change
June 7, 2007
Today's G-8 agreement represents modest but genuine progress toward an effective multilateral response to global climate change. Chancellor Merkel deserves enormous credit for forging a new consensus among G8 leaders that hopefully will be a foundation for concerted action.
In accepting the U.S. offer to host a meeting of major economies, the other G-8 leaders rightly insisted that this new dialogue go further than proposed by President Bush and consider international policies, not just a long-term goal. With their call for a global agreement under the UN Framework Convention by 2009, G-8 leaders have set a very ambitious timeline for establishing the post-2012 framework but offer no clear vision of what it should look like. Wide differences remain on fundamental issues such as the need for binding international commitments. And without such commitments, emissions will continue to grow.
If the United States and other G-8 governments are serious about this ambitious timeline, the next critical step will be launching formal negotiations under the Framework Convention at the upcoming talks in Bali. The goal in Bali should be a clear road-map toward a comprehensive post-2012 agreement with binding commitments by all the major economies.
Statement by Eileen Claussen, President, Pew Center on Global Climate Change
June 4, 2007
With its new national climate change strategy, and the establishment of a new National Leading Group headed by Premier Wen Jiabao, the Chinese leadership is signaling that it recognizes the critical importance of this issue to China and to other nations. The new strategy underscores the severe environmental and economic risks China faces in a warming world and outlines a broad array of government policies that are helping to moderate the growth of China's greenhouse gas emissions. These include ambitious energy efficiency and renewable energy goals and programs that reduce emissions from industry, agriculture, and forestry. Without these policies, China's emissions would be far higher than they are today.
However, much stronger action is needed to slow, stop, and reverse China's rapid emissions growth. When the United States caps its own greenhouse gas emissions, it will have begun to fulfill the commitment it made with other developed countries to lead the climate effort. It will then be reasonable to expect that China and other major emerging economies fulfill their responsibilities as well.
Our aim must be a new set of multilateral commitments ensuring that each of the major economies contributes its fair share to the global climate effort. The post-2012 framework should be flexible so that countries can take on different types of commitments. For developing countries, rather than economy-wide emissions targets, these could be "policy commitments" - China, for instance, could initially commit to strengthen its existing efficiency and renewables policies. But all commitments must be credible, binding, and closely monitored. Only through a balanced set of commitments and incentives can we hope to mobilize the efforts needed to dramatically reduce emissions in China and around the world.
President Bush Announces New Climate Proposal
Statement by Eileen Claussen, President of Pew Center on Global Climate Change
May 31, 2007
Six years after rejecting the Kyoto Protocol, President Bush has finally offered an alternative proposal, but it falls well short of what's needed. Agreement among the major emitting countries on a long-term global goal would be helpful. But far more critical is getting binding commitments on near- and mid-term action to reduce emissions. From all appearances, what the president is proposing is a strictly voluntary approach that won't deliver real results. We've tried the voluntary approach, both in the United States and internationally, and it doesn't work. The bottom line is we need binding commitments from all the major economies. The president isn't offering commitments and isn't asking for commitments, and without them we won't get the job done.
China’s Climate and Energy Policies
GHG Emissions – China has been the world’s largest greenhouse gas (GHG) emitter since 2006. Under the 2009 Copenhagen Accord, China pledged to reduce its emissions intensity by 40-45 percent from 2005 levels by 2020. In a joint announcement with the United States in Beijing in November 2014, China announced two new goals: peaking greenhouse gas emissions by around 2030, and increasing non-fossil sources to 20 percent of total energy by 2030. China later included these two goals in its intended nationally determined contribution (INDC) to the new international climate agreement to be concluded in Paris in December 2015, along with a goal of reducing carbon intensity 60-65 percent below 2005 levels by 2030.
Guiding Policy Framework – China’s twelfth five-year plan (FYP), covering 2011-15, spelled out a number of reforms to domestic energy and climate policies. The headline targets were to reduce energy intensity by an additional 16 percent, and carbon intensity by 17 percent, by 2015. It has been widely reported that China is currently on track to meet these 2015 targets. The thirteenth FYP is expected to be announced in early 2016.
Cap-and-Trade Programs – In October 2011, China announced its intention to establish seven pilot carbon trading systems in five municipalities and two provinces across the country. On June 19, 2014, the seventh of these pilots was launched in the city of Chongqing. The pilots cover between 35 to 60 percent of emissions within their respective jurisdictions. Each operates under its own rules tailored to regional or local circumstances.
The sub-national pilots reflect China’s growing interest in the use of market-based instruments – and emissions trading in particular – to reduce greenhouse gas emissions. The experience gained through these pilot programs is developing familiarity with emissions trading among companies and regulators in large portions of China.
On September 25, 2015, Chinese president Xi Jinping announced a plan to launch a nationwide cap-and-trade program in 2017, covering the power generation, iron and steel, chemicals, building materials including cement, paper-making and nonferrous metals sectors.
Renewable Energy – The twelfth FYP set a target of increasing non-fossil energy to 11.4 percent of total energy use by 2015. Hydroelectric power is the main non-fossil energy source in China, generating 14.7 percent of electricity in 2011. Indeed, China is the largest hydroelectric producer in the world. The government wishes to increase installed hydroelectric capacity from 230 GW in 2011, to 330 GW in 2017. Solar and wind energy deployment has increased at rapid pace – for instance, China installed 12.9 GW of solar photovoltaic (PV) in 2013 to reach a total capacity to 20 GW.[i] The Chinese government announced targets to increase solar and wind capacity to 70 and 150 GW, respectively, by 2017.
Coal – After many years of rapid increases, the government is now taking steps to reduce China’s coal consumption. In 2013, 67.5 percent of energy consumption was from coal.[ii] In September that year, following rising concerned about air pollution, the government issued the Air Pollution Prevention and Control Action plan with the headline target of reducing coal consumption to 65 percent of total primary energy by 2017. Bans on new coal power plants are now in place in three industrial regions: Beijing-Tianjin-Hebei, Yangtze River Delta and the Pearl River Delta.[iii]
More recently, the Ministry of Industry and Information Technology announced plans to reduce coal consumption by 80 million tons by 2017, and 160 million tons by 2020 – China’s total coal consumption in 2014 was approximately 2.8 billion tons.[iv][v] Furthermore, the State Council has announced plans to cap national coal consumption at 4.2 billion tons from 2020 onwards.[vi]
Nuclear – Nuclear power will play an increasing role in China’s energy mix in coming years. Capacity will increase from 14 GW in 2013 to 48 GW by 2017. In total, there are 26 reactors currently in operation, and 28 under construction.[vii] The government has set a target of 58 GW of nuclear capacity by 2020.
Energy Efficiency – Improving energy efficiency is critical to achieving China’s carbon intensity targets. In 2008, China passed the Energy Conservation Law to boost energy efficiency throughout the Chinese economy. In 2010, the NDRC implemented demand-side management regulations that require utilities to achieve electricity savings of 0.3 percent per year, and reduce peak demand by the same percentage.[viii] China also has sector-specific energy efficiency standards – for instance, new commercial buildings must comply with building codes on energy use.[ix] There are also energy efficiency standards for household appliances that become more stringent over time.[x]
Transportation – In 2012 the China State Council approved a development plan for energy saving from the automobile industry up to 2020. The objective is to speed the development and roll out of more fuel-efficient cars and new energy sources. For manufacturers, China set target fuel economy standards for new cars of 5L/100km, approximately 47 miles per gallon (mpg), by 2020. Consumers were offered a reduction in the vehicle tax paid on energy saving vehicles by half, and eliminating vehicle tax altogether on electric cars.[xi]
Energy and Climate Goals of China's 12th Five-Year Plan
The 12th Five-Year Plan (FYP) adopted by the Chinese government in March 2011 devotes considerable attention to energy and climate change and establishes a new set of targets and policies for 2011-2015. While some of the targets are largely in line with the status quo, other aspects of the plan represent more dramatic moves to reduce fossil energy consumption, promote low-carbon energy sources, and restructure China’s economy. Among the goals is to "gradually establish a carbon trade market." Key targets include:
- A 16 percent reduction in energy intensity (energy consumption per unit of GDP);
- Increasing non-fossil energy to 11.4 percent of total energy use; and
- A 17 percent reduction in carbon intensity (carbon emissions per unit of GDP).
C2ES Report: Market-Based Climate Mitigation Policies in Emerging Economies
Used by governments for decades, market-based policies are mechanisms to control environmental pollution at various leverage points. This brief provides an overview of market-based policies aimed at reducing GHG emissions in several major emerging economies: Brazil, China, India, South Africa and South Korea. By implementing regulatory and market-based policy instruments across their economies, these countries are seeking to promote cleaner technologies and behavior change while also promoting economic development and growth.
U.S.-China Workshop: Domestic MRV of Climate Efforts
This workshop focused on domestic monitoring and evaluation of mitigation-related efforts, and on the role of measurement, reporting and verification (MRV) in effective emissions markets, drawing in both areas on domestic experiences in the United States and China.
Beijing Workshop on Reporting Practices Related to Climate Change and Other International Challenges
The workshop focused on four topics: domestic MRV of mitigation efforts in China and the United States; MRV of support; reporting and review processes in other multilateral regimes such as the WTO, the IMF, and the Montreal Protocol; and lessons for international MRV of climate action.
Coal in China: Resources, Uses, and Advanced Coal Technologies
China’s energy-development pathway has increasingly become a topic of international attention, particularly as China has become the largest national source of annual greenhouse gas emissions. At the forefront of this pathway is a reliance on coal that has spanned many decades. In a world faced with increasing environmental pressures, China must develop ways to utilize coal more efficiently and more cleanly. Its ability to do so will be crucial for its domestic energy security, for its local environment and the well-being of its population, and for the future of the global climate.
Common Challenge, Collaborative Response: A Roadmap for U.S.-China Cooperation on Energy and Climate Change
A new report released by the Center and the Asia Society outlines a roadmap for a more comprehensive program of U.S.-China collaboration on energy and climate change. The report was produced in partnership between the Center for Climate and Energy Solutions and the Asia Society’s Center on U.S.-China Relations, in collaboration with The Brookings Institution, Council on Foreign Relations, National Committee on U.S.-China Relations, and Environmental Defense Fund.
A related article by Eileen Claussen discusses the importance of a U.S.-China partnership on climate change.
Climate Change Mitigation Measures in China
Read the China Fact Sheet.
China is now the world’s largest greenhouse gas (GHG) emitter, and its emissions are increasing rapidly with economic growth and rising energy demand. The United States remains the largest historic GHG emitter. China's emissions have grown by about 80% since 1990, driven heavily by increased consumption of electricity generated from coal.
As total emissions have grown, China has significantly reduced its emissions intensity (emissions per unit of GDP). China’s per capita emissions are below the world average and about one-fifth those of the United States.
China Releases Climate Change Plan
Read China's National Climate Change Program
On June 4, 2007, China released its first national climate change plan. Prepared by China’s National Development and Reform Commission, the plan outlines China’s strategy for addressing climate change through national programs aimed at mitigation, adaptation, science and technology research, and increasing public awareness.
Read Eileen Claussen's Statement
[i] Renewable Energy Policy Network for the 21st Century, “Renewables 2014 Global Status Report” 2014. P.56
[ii] BP Statistical Review of World Energy 2014
[iii] Barbara Finamore, “China pledges to Tackle Pollution with New Plan,” National Resources Defense Council. September 13, 2013. Available at: http://switchboard.nrdc.org/blogs/bfinamore/china_pledges_to_tackle_air_po.html
[iv] Reuters, “China to cut coal consumption to reduce pollution: Ministry” March 6, 2015. Available at: http://www.reuters.com/article/2015/03/06/us-china-coal-cut-idUSKBN0M20V820150306
[v] China Bureau of National Statistics. http://www.stats.gov.cn/english/PressRelease/201502/t20150228_687439.html
[vi] Barbara Finamore, “Another Major Climate Breakthrough: China Will Cap its Coal Consumption by 2020”, National Resources Defense Council, November 21, 2014. Available at: http://switchboard.nrdc.org/blogs/bfinamore/another_major_climate_breakthr.html
[vii] World Nuclear Association, “Nuclear Power in China” April 2015. Available at: http://www.world-nuclear.org/info/Country-Profiles/Countries-A-F/China--...
[viii] IEA Policies and Measures. April 2015. Available at: http://www.iea.org/policiesandmeasures/energyefficiency/?country=China
[ix] Pacific Northwest National Laboratory, “Analysis of the Chinese Market for Building Energy Efficiency”, March 2014. Available at: http://www.pnnl.gov/main/publications/external/technical_reports/PNNL-22761.pdf
[x] China FAQs, “Appliance Energy Efficiency Standards”, May 2010. Available at: http://www.chinafaqs.org/library/chinafaqs-appliance-energy-efficiency-standards
[xi] IEA Policies and Measures. April 2015. Available at: http://www.iea.org/policiesandmeasures/energyefficiency/?country=China
Congressional Testimony of Eileen Claussen: Regarding U.S. Re-Engagement in the Global Effort to Fight Climate Change
HON. EILEEN CLAUSSEN, PRESIDENT
PEW CENTER ON GLOBAL CLIMATE CHANGE
At the House of Representatives,
Committee on Foreign Affairs
May 15, 2007
Regarding U.S. Re-Engagement in the Global Effort to Fight Climate Change
Mr. Chairman and members of the committee, thank you for the opportunity to testify on U.S. Re-Engagement in the Global Effort to Fight Climate Change. My name is Eileen Claussen, and I am the President of the Pew Center on Global Climate Change.
The Pew Center on Global Climate Change is a non-profit, non-partisan and independent organization dedicated to providing credible information, straight answers and innovative solutions in the effort to address global climate change. Forty-three major companies in the Pew Center’s Business Environmental Leadership Council (BELC), most included in the Fortune 500, work with the Center to educate the public on the risks, challenges and solutions to climate change.
Mr. Chairman, I would like to commend you and the members of this committee for convening this hearing today on U.S. re-engagement in the global effort to fight climate change. As one who has worked for many years to advance efforts on this and other critical environmental challenges, it is very gratifying to me that the U.S. Congress is at long last engaged in a genuine debate on how – not if, but how – the United States should address global climate change. So far, this debate has focused primarily on questions of domestic climate policy. This is a critical first step. But truly meeting the challenge of climate change will require global solutions as well, and these will be possible, I believe, only with strong leadership from the United States. By broadening the scope of debate here in Washington, and by focusing attention on the international dimension of climate change, this hearing will help set the stage for constructive U.S. engagement and for an effective multilateral response to global climate change.
In my testimony today, I would like to outline the following: the key objectives that a post-2012 climate framework must meet; the form that a post-2012 framework should take; the steps the United States must take at home and internationally to ensure that such a framework is established; and how the United States can best address the questions of competitiveness and developing country participation. In the course of my testimony, I will address each of the questions the Committee has posed.
The Pew Center’s perspective on the future international framework reflects not only our own detailed analysis but also the collective views of an impressive group of policymakers and stakeholders from around the world. As part of our effort to help build consensus on these issues, we convened the Climate Dialogue at Pocantico, a group of 25 from government, business, and civil society in 15 key countries, all participating in their personal capacities. The group included senior policymakers from Britain, Germany, China, India, Japan, Australia, Canada, Mexico, Brazil and the United States. It also included senior executives from companies in several key sectors, including Alcoa, BP, DuPont, Exelon, Eskom (the largest electric utility in Africa), Rio Tinto, and Toyota. The group’s report was released in late 2005 at an event here in Congress hosted by Senators Biden and Lugar.
Despite a very diverse range of interests and perspectives, the Pocantico group succeeded in reaching consensus on a broad vision of a post-2012 climate framework. This vision begins with a set of key objectives that a post-2012 framework must meet. I would like to emphasize the two most critical objectives, which speak directly to the Committee’s question about the need for and nature of developing country participation.
First, the post-2012 framework must engage all of the world’s major economies. Twenty-five countries account for about 85 percent of global greenhouse gas emissions. These same countries also account for about 70 percent of global population and 85 percent of global GDP. The participation of all the major economies is critical, first and foremost, from an environmental perspective, because all must take sustained action if we are to achieve the steep reductions in emissions needed in the coming decades to avert dangerous climate change. But the participation of all major economies is critical from a political perspective as well. For reasons of competitiveness, none of these countries will be willing to undertake a sustained and ambitious effort against climate change without confidence that the others are contributing their fair share. We must agree to proceed together.
At the same time, we must recognize the tremendous diversity among the major economies. This group includes industrialized countries, developing countries, and economies in transition. Their per capita emissions range by a factor of 14 and their per capita incomes by a factor of 18. This leads directly to the second objective identified in our Pocantico dialogue: The post-2012 framework must provide flexibility for different national strategies and circumstances. The kinds of policies that effectively address climate change in ways consistent with other national priorities will vary from country to country. We must allow different pathways for different countries. An economy-wide emissions target may work for some but it will not work for others. If it is to achieve broad participation, the future framework must allow for variation both in the nature of commitments taken by countries and in the timeframes within which these commitments must be fulfilled.
With these key objectives in mind, the Pocantico group thenconsidered one of the other questions the Committee has asked: What could be the key elements of a post-2012 framework? The group recommended several policy approaches.
The first of these is targets and trading. This is the approach employed in the Kyoto Protocol, as well as in the European Union’s Emissions Trading Scheme and the Regional Greenhouse Gas Initiative being undertaken by ten states in the northeastern United States. There are very sound reasons why U.S. negotiators insisted so strongly on a market-based architecture for the Kyoto Protocol – and why many of the major climate bills now before Congress adopt the same approach. Emission targets provide a reasonable degree of environmental certainty, while emissions trading harnesses market forces to deliver those reductions at the lowest possible cost.
While targets and trading should remain a core element of the international effort, we must recognize that China, India, and other developing countries are highly unlikely to accept binding economy-wide emission limits any time in the foreseeable future. In their view, binding targets, by holding them to specific emission levels regardless of the economic consequences, would amount to a cap on economic growth. Economy-wide targets also may be technically impractical for them: to accept a binding target, a country must be able to reliably quantify its current emissions and project its future emissions, a capacity that at present few if any developing countries have.
A future framework, therefore, must allow for other approaches as well. A second potential element identified in the Pocantico dialogue is policy-based commitments. Under this approach, countries would commit to undertake national policies that will moderate or reduce their emissions without being bound to an economy-wide emissions limit. This is a more bottom-up approach, allowing countries to put forward commitments tailored to their specific circumstances and consistent with their core economic or development objectives. A country like China, for instance, could commit to strengthen its existing energy efficiency targets, renewable energy goals, and auto fuel economy standards. Tropical forest countries could commit to reduce deforestation. For this to work, the commitments would need to be credible and binding, with mechanisms to ensure close monitoring and compliance. Developed countries also may need to provide incentives for developing countries to adopt and implement stronger policies. One option is policy-based emissions crediting, similar to the Kyoto Protocol’s Clean Development Mechanism, granting countries tradable emission credits for meeting or exceeding their policy commitments.
A third potential element is sectoral agreements, in which governments commit to a set of targets, standards, or other measures to reduce emissions from a given sector, rather than economy-wide. In energy-intensive industries whose goods trade globally, which are the sectors most vulnerable to potential competitiveness impacts from carbon constraints, sectoral agreements can help resolve such concerns by ensuring a more level playing field. Such approaches are being explored by global industry groups in both the aluminum and cement sectors. We believe it is also worth exploring sectoral approaches in other sectors such as power and transportation where competitiveness is less of an issue but where large-scale emission reduction efforts are most urgent.
A fourth potential element is technology cooperation. This could include two types of agreements. The first would provide for joint research and development of “breakthrough” technologies with long investment horizons. Such agreements could build on the Asia Pacific Partnership and other technology initiatives but commit governments to the higher levels of funding needed to accelerate and better coordinate critical research and development. The second type of agreement could help to provide equitable access to both existing and new technologies by addressing finance, international property rights, and other issues that presently impede the flow of low-carbon technologies to developing countries.
The four elements I have outlined thus far fall under the heading of mitigation. A fifth critical element is adaptation. We need stronger adaptation efforts within the international climate framework but extending well beyond it as well. The top priority within the framework should be addressing the urgent needs of those countries most vulnerable to climate change. But the broader goal must be to spur comprehensive efforts to reduce climate vulnerability generally by integrating adaptation across the full range of development activities.
The Pocantico group also considered another question raised by the Committee: whether a new climate framework must establish a specific goal for stabilizing greenhouse gas concentrations in the atmosphere. The UN Framework Convention on Climate Change (UNFCCC) set a long-term objective for the international climate effort: stabilizing atmospheric greenhouse gas concentrations at levels that would prevent dangerous human interference with the climate system. Thus far, there has been no effort under the Convention to define that goal in quantitative terms. The Pocantico group clearly recognized the value of a quantified long-term goal in driving climate action, signaling markets, and establishing a metric to guide and assess near- and medium-term efforts. However, the group cautioned against trying to negotiate a specific quantified long-term target, particularly one intended as a basis for commitments. The scientific issues are so complex, and the inherent political stakes so great, that such a negotiation would likely be futile if not counterproductive. In my view, global consensus on a quantified long-term climate goal will be feasible only if the issue is taken up in an international venue other than that where climate commitments are to be negotiated. The U.S. Climate Action Partnership, of which the Pew Center is a founding partner, recommends stabilizing global greenhouse concentrations at a carbon dioxide equivalent level of 450-550 ppm.
Having outlined the potential elements of a post-2012 climate effort, I now turn to the question of how these approaches can be integrated in a common framework. While different countries should be allowed different pathways, they cannot simply each go their own way. An ad hoc series of parallel initiatives will not produce an aggregate effort nearly adequate to the need. By linking actions, and negotiating them as a package, nations are likely to undertake a higher level of effort than they would acting on their own. Such a negotiation could take the form of sequential bargaining, with countries proposing what they are prepared to do under one or more of the different tracks I’ve described, and then adjusting their proposals until agreement is reached on an overall package. To help ensure a balanced and therefore stronger outcome, it may be necessary to agree at the outset that certain countries will negotiate toward particular types of commitments most appropriate to their circumstances. The objective would be an integrated agreement is flexible enough to accommodate different types of commitments, and reciprocal enough to achieve a strong, sustained level of effort.
The Committee has asked whether the UNFCCC provides a viable foundation for a global climate framework. I believe the answer is yes. The Pocantico group recognized that one precondition for a successful negotiation is broad political consensus among the key players and, accordingly, urged an informal high-level dialogue among the major economies on the broad scope and terms of a post-2012 framework. However, the group agreed that once this informal consensus is reached, it should be carried back to the Framework Convention for the negotiation of formal agreements. The Convention enshrines key principles, such as “common but differentiated responsibilities,” and has been ratified by virtually every nation on earth, including the United States. It is regarded worldwide as the legitimate forum for negotiating and mobilizing the international climate effort. Further, the Convention is flexible enough to accommodate any of the approaches I have described here. The U.N. and Convention processes are often cited as obstacles to agreement on climate change. While these processes are far from perfect, I believe the largest obstacle to date has been a lack of political will, and if that obstacle were to be removed, process issues would not stand in the way of agreement.
The Committee has also asked what steps the United States can take to most effectively reengage in the global climate effort. An effective multilateral response to climate change will be possible only with U.S. engagement and leadership. Lack of action by the United States stands today as the major impediment to stronger efforts by other countries. Of the steps the United States can take to encourage global action, the most critical is to establish unilaterally a mandatory program to limit and reduce U.S. emissions. Demonstrating the will – and establishing the means – to reduce U.S. emissions will greatly alter the international political dynamic and improve prospects for international cooperation.
As it strengthens its domestic response to climate change, the United States should also help lead a renewed multilateral effort both within and outside the Framework Convention process. Within the Convention process, the United States should support the launch of a new round of negotiations, either in parallel with or subsuming those already underway under the Kyoto Protocol, seeking a balanced package of commitments among the major-emitting countries. The Conference of the Parties later this year in Bali presents an opportunity to launch such negotiations. Such negotiations will be fruitful, however, only if other efforts are taken in parallel to build confidence and seek political consensus among the major economies. The Gleneagles Dialogue launched by the G8+5 in 2005 has brought together the 20 largest energy-consuming countries to discuss issues of climate, energy, and development. If given a stronger mandate when it reports back to the G8+5 in 2008, this Dialogue could be a serve as the venue for developing the political consensus needed for the formal negotiations to succeed. If not, an alternative venue for this critical political dialogue will be needed.
Finally, I would like to address directly the questions of competitiveness and developing country participation. These issues are closely related. Ultimately, I believe, both are most effectively addressed through binding multilateral commitments. But it is important to distinguish these two issues because, in advance of a stronger global framework, each will require a different set of interim policy responses.
Competitiveness is a potential concern not for the U.S. economy as a whole, but rather for specific sectors – primarily energy-intensive industries, such as steel and aluminum, whose goods trade globally. In establishing a mandatory domestic climate program, steps can be taken to minimize or mitigate competitiveness impacts. For instance, in the design of a mandatory cap-and-trade program, potentially vulnerable sectors could be allowed special consideration in the emission allowance process. Another option is to provide technology and transition assistance to affected industries and communities, possibly funded by auctioning a portion of allowances. As a longer-term option, legislation also could stipulate that if the major developing countries have not taken stronger action to reduce emissions within a specified timeframe, the United States, in concert with other industrialized countries, will consider tariffs on their energy-intensive exports or other mechanisms to correct the resulting competitive imbalances. I would note that on their own, however, these latter approaches are not likely to induce strong developing country action, and could lead to more confrontation than cooperation.
Engaging developing countries will require a firm but balanced approach. To begin with, we must be absolutely clear in our expectation that the major developing countries assume binding commitments in a post-2012 framework. It is true that the United States, the world’s largest economy, is also by far the largest historic contributor to climate change. In establishing mandatory limits on domestic emissions, the United States will have begun to fulfill the commitment it made with other industrialized countries to lead the climate change effort. And having done so, it will then be reasonable to expect that countries like China fulfill their responsibilities as well. China’s emissions have grown 80 percent since 1990 and could rise another 80 percent by 2020. It is essential that these trends be reversed. Realistically, given the greater capacity and historic responsibility of industrialized countries, China, India and other developing countries will require incentives to undertake strong climate efforts. The United States should provide market-based incentives through a domestic cap-and-trade program by recognizing credits for emission reductions achieved in developing countries. In addition, targeted bilateral and multilateral assistance should be provided for the deployment of critical high-cost technologies such as carbon-capture-and storage. However, in return for these incentives, China and the other major developing countries must assume appropriate commitments that will slow and ultimately reverse the growth of their greenhouse gas emissions.
To summarize, I believe it is incumbent upon the United States to lead both by strong action at home and by actively and constructively reengaging in the international climate effort. Only with strong U.S. participation and leadership can we achieve a fair and effective global response to the critical challenge of climate change. I thank the Committee for the opportunity to present these views and would be happy to answer your questions.
Building on Pocantico: Sectoral Agreements and Policy-Based Commitments in a Post-2012 Framework
May 14, 2007
View a webcast of this side event.
Event participants included:
- Elliot Diringer, Pew Center
- Daniel Bodansky, University of Georgia School of Law
- Joanna Lewis, Pew Center
- Artur Runge-Metzger, European Commission
- Harald Winkler, Energy Research Centre, South Africa
Press Release: Pew Reports Examine Sectoral Agreements and Policy Commitments in a Post-2012 Framework
May 14, 2007
Pew Center Contact: Katie Mandes, (703) 516-4146
PEW CENTER EXAMINES SECTORAL AGREEMENTS AND POLICY COMMITMENTS AS ELEMENTS OF A POST-2012 CLIMATE FRAMEWORK
New Reports Build on Recommendations of Climate Dialogue at Pocantico
New reports released today by the Pew Center on Global Climate Change explore two approaches to reducing greenhouse gas emissions that could be part of a new multilateral climate agreement – policy- based commitments and international sectoral agreements.
The new reports elaborate on two of the options recommended by the Climate Dialogue at Pocantico, a group of senior policymakers and stakeholders from 15 countries convened by the Pew Center. The group’s report, International Climate Efforts Beyond 2012, calls for engaging all major economies in the post-2012 climate effort through a flexible framework allowing countries to take on different types of commitments.
International Sectoral Agreements in a Post-2012 Climate Framework,by Daniel Bodansky of the University of Georgia School of Law, examines the option of negotiating one or more intergovernmental agreements to reduce emissions from specific sectors, such as electricity, transportation, or energy-intensive industries. Policy-Based Commitments in a Post-2012 Framework, by Joanna Lewis and Elliot Diringer of the Pew Center, looks at the option of policy-based commitments, in which developing countries commit to emission reduction policies other than binding economy-wide emission targets.
“We need an international framework that commits all the major economies to strong, effective action but lets them pursue the strategies that work best for them. That’s the core message from our Pocantico dialogue,” said Pew Center President Eileen Claussen. “Sectoral agreements and policy commitments could be key elements in a flexible but integrated framework ensuring that all the major economies contribute their fair share.”
The new reports envision sectoral agreements and policy commitments as potential elements in a balanced package of post-2012 commitments that likely would include economy-wide emission targets for some countries. Other potential elements identified in the Pocantico dialogue are agreements to facilitate technology development and access and to support adaptation efforts in countries highly vulnerable to climate change.
The paper on sectoral approaches discusses the benefits and challenges of structuring climate agreements around discrete sectors and the different forms they could take, such as emission targets, technology standards, or performance standards. It concludes that sectoral agreements can contribute to the post-2012 effort by helping to defuse competitiveness issues, particularly in energy-intensive manufacturing industries; by targeting technology and financial assistance in sectors such as electricity where it may be most critical; and, in sectors such as the automotive industry, by catalyzing broad technology transformations through agreements among a small number of key countries
The second paper describes an approach in which developing countries commit to implement national policies that reduce greenhouse gas emissions but are not bound by economy-wide emission limits. Such policy commitments could include energy efficiency goals or standards, renewable energy targets, or measures promoting sequestration in agriculture or forestry. This approach would allow countries to tailor commitments to their domestic needs and circumstances and could be coupled with policy-based emissions crediting or other incentives. The paper emphasizes the need for reliable quantification of emission results and concludes that a policy-based approach is viable only if other parties see the commitments as credible, concrete contributions to the global effort.
To link to these reports, please visit our International Policy page.
Policy-Based Commitments in a Post-2012 Climate Framework
Prepared for the Pew Center on Global Climate Change
Joanna Lewis and Elliot Diringer, Pew Center on Global Climate Change
This paper elaborates on the concept of policy-based commitments as one component of a post-2012 climate framework. As conceived here, the policy-based approach would be an avenue for developing countries in particular to put forward national policies of their choosing as contributions to the global climate effort. These policies could vary widely in scope and form, from economy-wide energy efficiency goals to sector-specific standards or reforms.
Download entire report (pdf)