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Beyond Bonn: Forging a Global Agreement

By Eileen Claussen, President, Pew Center on Global Climate Change

Asia Perspectives
The Periodical of the Mansfield Center for Pacific Affairs

Fall 2001

Almost a decade ago, the nations of the world gathered in Rio de Janeiro, Brazil, and acknowledged that "the global nature of climate change calls for the widest possible cooperation by all countries" to address this enormous challenge. Over the intervening years, the international effort to live up to these words from the United Nations Framework Convention on Climate Change has proceeded in a series of fits and starts that bring to mind the progress of a run-down car. One of the more tenuous moments came earlier this year after failed negotiations in The Hague and the U.S. government's unilateral rejection of the Kyoto Protocol. But now, it appears the old car is back on the road and poised to make real progress.

Even without the United States' participation, the climate change agreement reached by 178 nations in Bonn, Germany, in July marks an important milestone in the global effort to address the most urgent environmental challenge facing the world today. If all goes according to plan, the outcome in Bonn will allow the Kyoto agreement to enter into force in time for the tenth anniversary of the Rio meeting in 2002. First negotiated in 1997, the Protocol requires developed countries to reduce or limit their emissions of greenhouse gases in relation to 1990 levels, with different countries agreeing to different targets.

At the same time that Bonn has breathed new life into Kyoto, there is growing momentum in the United States for domestic strategies to reduce emissions. Indeed, the prospects for action in Congress are stronger than ever - despite the Bush administration's rejection of Kyoto. The challenge now is to insure that the Protocol stays on the road to ratification and entry into force while the United States begins to pursue good-faith domestic efforts to reduce its greenhouse gas emissions. To the extent that U.S. efforts are compatible with the Kyoto framework, the world can still hold out hope that the two roads will eventually merge, yielding a truly global plan of action.

Did U.S. Rejection Save Kyoto?

In the weeks since the conclusion of the Bonn meeting, some have suggested that the U.S. government's repudiation of the Kyoto accord actually saved the Protocol from a harsher fate. After the contentious breakup of the negotiations in The Hague in November 2000, many suggested that it was the end of the road for Kyoto, and that disagreements over the details of the accord-particularly between the United States and Europe-were too great to bridge. The rigidly anti-Kyoto stance adopted just three months later by the Bush administration only added to the impression that the process had run its course.

As it turned out, however, U.S. rejection of the treaty served to rally other countries to its defense. After 10 years of hard negotiations, these nations refused to accept that their work had been in vain. And they resolved to take whatever steps they could to revive the Protocol and allow it to enter into force-with or without the United States. If this meant reaching new compromises on issues where nations had previously refused to budge, then so be it. The view began to take hold among these countries that a flawed agreement was better than none, and that the world could not wait any longer to begin taking concrete steps toward a safer climate.

While many details are as yet undecided, the broad agreement reached in Bonn will likely provide countries with a high degree of flexibility in how they use various strategies-from sinks to emissions trading-to achieve their targets for reduced emissions. Largely in response to concerns from Japan, Australia and Canada, the Europeans backed off earlier demands seeking to place onerous limits on exactly how countries could go about achieving their Kyoto commitments. This is a very important and positive development because it will permit countries and businesses to meet their objectives in the most cost-effective ways. And, ironically, it is a development that the United States had lobbied intensively for during previous rounds of negotiations.

Looking forward, it is critical that the momentum achieved in Bonn be maintained in the months ahead. The parties to the agreement, especially Japan, need to move swiftly to ratify it and bring it into force and demonstrate that the Kyoto process can yield real benefits for the global climate.

Kyoto But a First Step

Still, it is important not to oversell the outcome of the negotiations in Bonn. The Kyoto Protocol is only a very small first step on what will be a long march to a less carbon-intensive world. Its initial targets for emissions reductions take us only to the 2008-2012 period, and they represent just a very small down payment on the level of emissions reductions that scientists say we must achieve in order to have a real effect on mitigating climate change.

In addition, many developing countries, which have no binding emission targets under Kyoto, will have to play larger roles in reducing global emissions in the years ahead. As these nations develop, they will need to do so in ways that are less carbon-intensive and more efficient. This is a challenge they do not face alone-the time has come for all nations of the world, developing or already developed, to consider how best to grow their economies while at the same time reduce the impact of their growth and development on the global environment.

The ultimate impact of the Kyoto Protocol also will be severely limited by the United States government's decision not to be a party to the agreement. Ultimately, no solution to global climate change will be successful without the participation and support of the world's leading generator of greenhouse gases.

It has been suggested that the United States should offer an alternative to Kyoto-something more in line with the Bush administration's priorities. However, this likely would serve only as a distraction and yet another obstacle to real action. Much more important is that U.S. leaders begin to focus seriously on how to achieve real reductions in domestic emissions.

Next Steps for the United States

To date, efforts to reduce U.S. emissions have been limited almost exclusively to voluntary activities at the federal, state, local and corporate levels. While some voluntary efforts have resulted in significant emissions cuts-some companies, for instance, have achieve reductions of 10 percent or more-they have not succeeded in curbing the overall growth in U.S. emissions.

Three decades of experience fighting pollution in the United States have taught us a great deal about what works best. In general, the most cost-effective approaches allow emitters flexibility to decide how best to meet a given, binding emissions limit; provide early direction so targets can be anticipated and factored into major capital and investment decisions; and employ market mechanisms, such as emissions trading, to achieve reductions where they cost least. To ease the transition from established ways of doing business, targets should be realistic and achievable. What is important is that they be strong enough to spur real action and to encourage investment in development of the technology and infrastructure needed to achieve the long-term objective.

A good first step for the United States will be to get its house in order by immediately requiring accurate measurement, tracking, reporting and disclosure of greenhouse gas emissions. However, the long-term emission reductions needed can be achieved only with a far more comprehensive-and binding-strategy. Alternative approaches should be closely studied, and the results publicly debated. But much of the analysis thus far suggests that domestic "cap-and-trade" systems-which set an overall cap on emissions and establish a market in carbon credits-can provide the private sector with the certainty, the flexibility and the incentives it needs to achieve emission reductions at the lowest possible cost.

Ideally, the design of a domestic U.S. program would be compatible with the Kyoto Protocol or any successor agreement. As an interim step, it would be important to explore ways for U.S. companies to have access to the emerging market in emissions credits, even before the United States becomes party to an international agreement. While it might not be possible to engage directly in the trading system established under the Protocol, companies should be provided other ways to receive credit for emissions reductions achieved abroad.

Ultimately, however, the United States must become a full partner in the global effort. From an economic standpoint, a global agreement is needed to achieve maximum cost-effectiveness by allowing full access to the carbon market; to provide businesses, particularly those operating multinationally, the certainty and consistency they need; and to stimulate worldwide demand for the technology that will allow conversion to a low-carbon economy. From an environmental standpoint, only a global agreement can ensure that all major emitting countries are achieving the emissions reductions that are necessary to avert the worst consequences of global warming.

The Road Ahead

Our immediate challenges are to bring the Kyoto Protocol into force, launch real emission reduction efforts in the United States, and chart a path for merging these frameworks. At the same time, we must begin developing creative strategies to meet the challenges still ahead. As industrialized countries demonstrate progress in meeting their initial targets, we must find ways to more fully engage developing countries in the global effort. We also must begin working toward international consensus on a long-term environmental objective, both to determine the level of emissions reduction that ultimately will be needed, and to help provide a basis for equitably sharing the burden among developed and developing nations.

The most recent projections from the Intergovernmental Panel on Climate Change indicate that worldwide temperatures will rise by anywhere from 2.5 to 10 degrees Fahrenheit over the next century, and that the rise in temperature will have important and potentially calamitous effects on sea level, weather patterns and more.

As these impacts of climate change become more real to people, and as governments and businesses begin to come to terms with the dramatic effect of climate change on our economies and our communities, I believe that the global effort to achieve real, long-term solutions to this problem will gain even more momentum. And even the United States will not be able to avoid the necessity of taking strong action, both domestically and internationally, to avert a looming environmental crisis.

Eileen Claussen is the President of the Pew Center on Global Climate Change, and President and Chairman of the Board of Strategies for the Global Environment. She has served as Assistant Secretary of State for Oceans and International Environmental and Scientific Affairs, as a Special Assistant to the President at the National Security Council, and has spent over 20 years at the U.S. Environmental Protection Agency. Ms. Claussen is the recipient of the Department of State's Career Achievement Award, and the Distinguished Executive Award for Sustained Extraordinary Accomplishment. She served as the Timothy Atkeson Scholar in Residence at Yale University, is a member of the Board of Directors of the Environmental Law Institute, and currently serves as a Commissioner on the Pew Oceans Commission.

 

© 2001 The Mansfield Center for Pacific Affairs

 

Appeared in Asia Perspectives, The Periodical of the Mansfield Center for Pacific Affairs, Fall 2001— by Eileen Claussen
Eileen Claussen
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Press Release: Nobel Prize Recipient Dr. Joseph E. Stiglitz Calls for Immediate Action Against Climate Change

For Immediate Release:  
October 11, 2001

Contact: Katie Mandes
703-516-4146

Nobel Prize Recipient Dr. Joseph E. Stiglitz Calls for Immediate Action Against Climate Change

Dr. Joseph E. Stiglitz, co-recipient of the 2001 Nobel Prize in economics, called on governments today to join in a comprehensive global strategy to address the long-term threat of global climate change.

In a keynote address at a workshop sponsored by the Pew Center on Global Climate Change, Dr. Stiglitz said that despite uncertainties over the pace and precise impacts of climate change, governments can and should take immediate cost-effective steps to begin reducing emissions of greenhouse gases.

"Climate change is probably the most important environmental problem we face in the world," Dr. Stiglitz told 40 scientists, economists and other experts at the Pew Center's Workshop on the Timing of Climate Change Policies. "We need a framework for collective action."

Dr. Stiglitz, a professor of economics at Columbia University, was one of three U.S. economists awarded the Nobel Memorial Prize in Economic Science on Wednesday for their seminal work on the role of "asymmetric information" in markets. He previously served as chairman of the President's Council of Economic Advisers and as chief economist at the World Bank.

"We congratulate Dr. Stiglitz on his prestigious award and are delighted that he could share with us his keen insights on the challenge of climate change - particularly on what is such a remarkable day for him," said Eileen Claussen, president of the Pew Center on Global Climate Change.

In a paper presented at the workshop, Dr. Stiglitz and his co-authors explored the challenges of crafting a global strategy to address climate change given uncertainties in the science and economics and the diverse and conflicting interests of nations.

The paper states, "A global consensus now exists that climate change represents a significant potential threat to the world's well-being&Put simply, we favor immediate action," the authors state. "Although policymakers are forced to make decisions under uncertainty, they can undertake actions that help reduce this uncertainty. In particular, pursuing some emissions abatement policies now allows policy-makers to learn more about the costs of emission reduction."

The full text of his paper, co-authored with Peter R. Orszag of the Brookings Institution and Joseph E. Aldy of Harvard University, is available on the Pew Center website, www.c2es.org.

Dr. Stiglitz was introduced at the workshop by Dr. Kenneth J. Arrow of Stanford University, a previous recipient of the Nobel Prize in economics and a member of the Pew Center's board of directors.

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The Pew Center was established in May 1998 by The Pew Charitable Trusts, one of the United States' largest philanthropies and an influential voice in efforts to improve the quality of the environment. The Pew Center is an independent, nonprofit, and non-partisan organization dedicated to providing credible information, straight answers and innovative solutions in the effort to address global climate change. The Pew Center is led by Eileen Claussen, the former U.S. Assistant Secretary of State for Oceans and International Environmental and Scientific Affairs.

Timing of Climate Change Policies Workshop Summary

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The Pew Center on Global Climate Change held a Workshop on the Timing of Climate Change Policies in Washington, D.C.

Pew Center Workshop on the Timing of Climate Change Policies

October 10-12, 2001
The Westin Grand Hotel, Washington, DC

On October 10-12, 2001, The Pew Center on Global Climate Change held a Workshop on the Timing of Climate Change Policies in Washington, D.C. This workshop brought together leading economists, scientists, policy-makers, business leaders, and others interested in climate change science and policy. The purpose of the workshop was to investigate the appropriate timing of the world's policy response to the challenge of global climate change. The workshop produced a consensus that action on climate change needs to begin now to satisfy a variety of concerns. This volume includes a summary of the workshop proceedings, final texts of peer-reviewed papers commissioned for the workshop, and other presentation materials.

Climate Change: A Strategy for the Future

Climate Change: A Strategy for the Future

Speech  by Eileen Claussen, President
Pew Center on Global Climate Change

Honors Colloquium on a Just and Sustainable Future
University of Rhode Island

September 25, 2001

I am very happy to have the opportunity to address this honors colloquium, and I want to pay tribute to the faculty, staff, and students here at the University of Rhode Island's Sustainable Communities Initiative for trying to come to terms with a very serious question-and that is, how do we create a just and sustainable future?

This, of course, is an extraordinary time, and a just and sustainable future may seem very far away as we ponder the horrific events of two weeks past. Usually, when I give a speech, I try to begin with some humor, and I do this because I think it is important that we not take ourselves, or our specific issues and interests, too seriously. But I think the events of September 11th have cast an enormous shadow over all of us-and, with it, a sadness and a seriousness of purpose that we cannot escape. And so I ask you, for the next short while at least, and for longer if you can, to be thoughtful about the issue of climate change, because it, too, requires us to be serious and reflective and determined about what we need to do to make the world a safer place.

In talking about climate change today, I want to touch first on the science - and, more specifically, on the ever-solidifying scientific consensus that this is a very serious problem that demands very serious action. I'd like to talk broadly about the challenge we face, and the ways in which many in the business community are rising to that challenge. I'll turn then to the essential role of government - both internationally and here in the United States. And, finally, I will suggest how we might forge a common path forward that is sustainable, just, and fair to all.

Our goal must be to facilitate the arrival of a second industrial revolution. And this means doing all we can to accelerate the development of new technologies that will move us closer to a low-carbon world economy.

The Science of Climate Change: A Few Observations

Let us focus first on the science of climate change. The Intergovernmental Panel on Climate Change (or IPCC) is a body created by the United Nations to reach scientific consensus about the magnitude and nature of the climate problem. In its "Third Assessment Report," approved in January of this year, the IPCC said it now expects the global average surface temperature to rise by between 2.5 and 10 degrees Fahrenheit over the course of the 21st century. This is a much greater increase than projected just five years ago. Even at the low end of the projection, the warming trend is expected to cause significant problems-more sea level rise, droughts and floods; increasingly violent storms; damage to our ecosystems; effects on the availability of water; and impacts on our forests and agriculture. And the higher-end projections of 10 degrees or more could prove catastrophic. Studies from the IPCC and others also confirm that greenhouse gases produced by human activities, mainly the burning of fossil fuels, are the principal cause of the continuing warming trend.

These findings were confirmed in June by a panel of the National Academy of Sciences, put together at the request of President Bush, and including some scientists who had previously expressed skepticism about the nature and pace of global climate change. The NAS report also affirms that temperatures at the Earth's surface already are rising and that the warming trend has intensified in the last 20 years.

What will be the impact of climate change here in Rhode Island? While it is hard to pinpoint impacts on a state-by-state basis, it is fair to say that Rhode Islanders-and, indeed, all New Englanders-will see temperatures rise, along with significant increases in precipitation. Fragile coastal ecosystems could be at risk as global sea levels rise, barrier reef islands are inundated, and we see an increase in the frequency and severity of storms-as scientists expect we will. Sea-level rise also could lead to flooding of low-lying property, loss of coastal wetlands, erosion of beaches, saltwater contamination of drinking water, and damage to low-lying roads, causeways, and bridges. Agricultural production will surely be affected both here and elsewhere because of warmer temperatures, less soil moisture, and other climate change-related problems. And the possibility of health problems, including increases in heat-related illnesses, cannot be discounted.

The bottom line is that if we need a reason to act on this issue, the latest science certainly provides one. The fact that there is uncertainty about exactly how much temperatures will rise or what the precise effects will be should be expected. Both the IPCC and the NAS have identified a number of critical research challenges that need to be addressed in the coming years. But, increasingly, the science tells us we would be irresponsible not to take the threat of climate change very seriously.

A Second Industrial Revolution

How, then, do we address this threat? How do we avert the many risks that the scientific community is warning us about? Quite obviously, we must reduce our emissions of the greenhouse gases that are contributing to climate change. And to do that, we must launch a new industrial revolution.

This will be a revolution characterized more than anything else by a growing reliance on low-carbon and even no-carbon energy sources to power the world's continuing economic development and growth. We must embrace the possibility of "decarbonizing" our economies. At the same time, we must also be realistic about what can be done and in what time frame. Before you start to think of me as a latter-day Pangloss, let me assure you that I am fully aware that all countries will continue to use petroleum and coal for many years to come. The challenge with respect to these traditional fuel sources will be to promote ever-increasing levels of efficiency in their transmission and use at the same time as we are working to develop and deploy cleaner energy sources for the future. Coal currently accounts for 24 percent of the United States' total primary energy supply-and a remarkable 57 percent of China's. Even if these numbers edge downward-as they are already doing with the introduction of increasing numbers of natural gas-fired power plants-the predominance of coal in the worldwide energy mix means we need to find and embrace cleaner-burning ways of using it. And we need to think seriously about sequestering coal-related carbon dioxide emissions.

But these types of steps clearly will not be enough. The bottom line is that we need new technologies to meet the energy and environmental challenges we face. To effectively address climate change, we need to lower carbon intensity (that is, the amount of carbon we emit per unit of GDP); we need to become more energy efficient, so that we use less energy to achieve the same results; we need to promote carbon sequestration, so that the carbon we do emit does not enter the atmosphere and affect the climate; and we must find ways to limit emissions of non-CO2 greenhouse gases. This will require fundamentally new technologies, as well as dramatic improvements in existing ones. New, less carbon-intensive ways of producing, distributing, and using energy will be essential. The redesign of industrial processes, consumer products, and agricultural technologies and practices will also be critical.

These changes need not take place overnight. They can be introduced over decades as we turn over our existing capital stocks and establish new infrastructure. But we must begin making the investments needed to usher in this new industrial revolution, and we must begin making those investments now.

Industry Takes the Lead

Many businesses, in fact, already are taking important steps to address climate change. About half of the 36 companies that are part of the Pew Center's Business Environmental Leadership Council have set specific, quantitative targets to reduce their greenhouse gas emissions, and others are working toward establishing these objectives. Consider DuPont, a corporation that is well on its way to achieving its goal of reducing greenhouse gas emissions by 65 percent before 2010, relative to 1990 levels. Or Baxter International, which is committed to improving its energy efficiency by 30 percent below 1996 levels by 2005. Or IBM, which has committed to having 90 to 100 percent of its new model computers meet Energy Star criteria for energy efficiency.

Other companies, too, are making process and efficiency improvements that are yielding real reductions in emissions. The energy company Enron, for example, reduced its greenhouse gas emissions by controlling leaks in its natural gas pipelines. And TransAlta Corporation improved its energy efficiency by about 4 percent when it upgraded old, less efficient turbines and other systems.

In addition to these types of steps, some companies are investing in dramatic changes to their production processes. Alcoa, for example, is developing a new technology for smelting aluminum that, if successful, will allow the company to reduce its greenhouse gas emissions to half their 1990 levels over the next nine years. Similarly, Shell aims to achieve its greenhouse gas reduction target by revamping its disposal of the waste gases resulting from oil and gas production, even as it puts increasing emphasis on renewable energy sources.

The States are Moving

We are also beginning to see real movement on this issue from a number of states. On August 28th of this year, the New England Governors and Eastern Canadian premiers approved a comprehensive Climate Change Action Plan at their annual meeting. This plan includes goals of returning the levels of greenhouse gas emissions to 1990 levels by 2010, reducing them to 10% below that level by 2020, and putting in place a process to review, adjust and add new goals.

The state of New Jersey is hoping to reduce its levels of greenhouse gases by 3.5% from 1990 levels by 2005. The state of Oregon has put in place carbon dioxide standards for new power plants. The state of Massachusetts is regulating its highest emitting power plants, and expects to see significant reductions in emissions by 2008. And many others are experimenting and beginning to implement different approaches to addressing the climate change issue.

The Role of Federal Government Action

All of these are important developments-and they show how increasing numbers of leading companies and states see a clear interest both in reducing their emissions and in helping to shape the energy economy of the future. But voluntary actions undertaken on a largely random basis by some members of the business community or by a small handful of states are not enough. In the United States, we have had voluntary efforts in place for much of the past decade, and still we have seen a dramatic rise in emissions - almost 12 percent over 1990 levels.

In the end, there is little incentive for any company or state to undertake real action unless, ultimately, all do-and unless all are in some manner held accountable. Markets, of course, will be instrumental in mobilizing the necessary resources and know-how. Market-based strategies such as emissions trading will also help deliver emissions reductions at the lowest possible cost. But markets can move us in the right direction only if they are given the right signals. It is our national government's job to send the right signals.

Government can and must play a critical role in establishing the ground rules for the energy economy of the future. Because this is a global problem that must eventually be solved globally, it means sending global signals and establishing mandatory global frameworks for action, because each country must be assured that others will act too. And it means, in turn, the adoption of mandatory programs on a country-by-country basis. What truly matters, of course, is what individual countries and individual businesses do to reduce their individual contributions to this problem. And there is no substitute for actually requiring countries and businesses to reduce emissions, because it is in the process of trying to meet clear objectives that innovation will flourish.

The Significance of the "Kyoto Compromise"

Is government rising to the challenge? Looking first to the international arena, we see that the world community-minus one very important player-has at long last agreed on a set of first steps to address climate change.

As all of you know, over the summer in Bonn, Germany, 178 nations reached a tentative compromise on the rules that will allow the Kyoto Protocol to enter into force. The Kyoto Protocol, of course is the agreement first negotiated in 1997 that requires developed countries to reduce or limit their emissions of greenhouse in relation to 1990 levels, with different countries agreeing to different targets.

In addition to establishing targets, the Kyoto Protocol outlines how countries can achieve them-for example, by making emission reductions at home, by trading emission credits with others, and by using "sinks" such as farms and forests to remove carbon from the atmosphere. Although many of the details on how these mechanisms will work still need to be decided, the compromise reached in Bonn will likely provide countries with a high degree of flexibility in how they use these various strategies. And this, I believe, is a very important and positive development, because it will permit countries and businesses to meet their objectives in the most cost-effective ways.

But the Kyoto Protocol is just a first step on what will be a long march to a less carbon-intensive world. Its initial targets for emission reductions take us only to the 2008-2012 period, and they represent just a very small down payment on the level of reductions that scientists say we must achieve in order to have a real effect on mitigating climate change.

It is also important to note that the ultimate impact of the Kyoto Protocol will be severely limited by the United States government's decision not to be a party to the agreement. The Bush Administration has said repeatedly that it believes Kyoto is fatally flawed and not acceptable to the United States. Granted, the Protocol does have its problems-it is, after all, an agreement of approximately 180 countries with differing aspirations, differing economies, and differing views of the environment. But I believe that the other nations of the world, in agreeing to a compromise solution in Bonn, decided to send a message to the United States that an imperfect agreement is better than none-and that we cannot wait any longer to begin working together to solve the most important environmental issue facing the world today.

The Kyoto compromise very clearly does not amount to a solution to the problem of climate change. Rather, it is a first, strong statement of purpose and will to deal with this problem. And, therefore, it is an essential and historic step.

Launching Domestic Efforts in the U.S.

And what of the United States? Interestingly, in the same way that the Bush Administration's rejection of Kyoto seems to have galvanized international support for the Protocol, it appears to have generated new momentum on Capitol Hill to finally begin tackling the challenge of climate change. It is too early to know how the tragic events of September 11 will affect this and so many other vital issues in the months ahead. But prior to those events, there were strong indications that Congress was more prepared than ever to begin building the programs needed to reduce greenhouse gas emissions here in the United States.

It is important to note that this new support comes from both sides of the aisle. Perhaps the biggest sign of a "changing climate" in Congress is legislation introduced by Senator Robert Byrd of coal-producing West Virginia and Senator Ted Stevens of oil-producing Alaska. In addition to providing money for technology research, the Senators' bill would require the President to develop a climate change strategy aimed at stabilizing greenhouse gas concentrations in the atmosphere. Senators John McCain and Joseph Lieberman - another bipartisan team - are going even further. They have announced that they plan to introduce major legislation to require greenhouse gas reductions throughout the economy under an emissions trading system - a proven way to cut emissions cost-effectively, and one that we strongly support.

What are some of the other key elements of a serious domestic program? We need, first and foremost, an energy policy that is climate-friendly. We need policies to deal with energy-using products, such as automobiles and appliances, so that they use fuel more efficiently and are compatible with different, non-fossil fuels. And we need a technology policy that will speed our development and diffusion of new technologies.

None of this will happen overnight. But there is good reason to believe that as we approach the mid-term congressional elections next year, and the presidential election in 2004, the prospects will grow only stronger. And as the United States begins to demonstrate real effort to curb its own emissions, it can credibly reenter the international dialogue and work more closely with other nations to chart a common path forward.

Which leads me to the "strategy for the future" that is mentioned in the title of my remarks. The strategy, in my view, is to insure that the Kyoto Protocol stays on the road to ratification and entry into force, while the United States begins to pursue good-faith domestic efforts to reduce its greenhouse gas emissions. To the extent that U.S. efforts are compatible with the Kyoto framework-and I hope they will be compatible-then the world can still hold out hope that the two roads will eventually merge, yielding a truly global plan of action.

Resolving the Equity Issue

Achieving that global strategy, however, will mean coming to terms with an issue that has loomed over the climate debate from the start, but has yet to be faced head-on - and that is the issue of fairness. For as the title of your colloquium, "A Just and Sustainable Future," rightly suggests, this is not about sustainability alone, but justice as well. Indeed, it is hard to imagine a future that is truly sustainable unless it is also fair and just.

From Rio in 1992 through Kyoto in 1997 and up to the most recent round of negotiations in Bonn, the international climate talks have proceeded on the basis of a common understanding: developed countries must act first. This bargain of sorts - which obligates one group of countries to act with the understanding that the other group will follow - acknowledges the fundamental inequities presented by climate change. It is an undeniable fact that developed countries account for the vast majority of the greenhouse gases put in the atmosphere over the past century, and that their per capita emissions are many times those of developing countries. (The United States, for example, contributed nearly a third of worldwide emissions last century and continues to produce roughly a quarter of global emissions with only 4 percent of the world's population.)

But historic responsibility for climate change is just one piece of the equity equation. It is also undeniable that those least responsible, the developing countries, face a disproportionate share of the impacts of global warming - from flooding to disease to famine - while having fewer resources with which to cope.

So while many in the United States, including President Bush, fault Kyoto for letting developing countries off the hook, I believe it is only fair that the developed countries act first. But I also believe that, in time, the developing countries must act too. Indeed, the emission reduction efforts finally getting underway in the industrial world will be pointless unless developing countries agree in some way to restrain the rapid rise in their own emissions.

It is important to recognize the steps already being taken by developing countries. Measures such as market reforms and energy efficiency improvements, while more often motivated by concerns other than climate change, are, in fact, resulting in significant emissions savings. China, for example, cut carbon dioxide emissions by more than 10 percent over the last five years. But far more effort is needed. In a series of reports looking at electric power in developing countries, the Pew Center found that emissions from that sector alone will triple by 2020 under a business-as-usual scenario. However, we also found that efficiency improvements and the introduction of low-emission technologies could cut this increase in half while maintaining economic growth. Once again, technology is absolutely critical.

Arriving at a truly global strategy, then, will require a fundamental rethinking of the approach taken so far. The straightforward targets set by Kyoto - cutting each country's emissions by an agreed percentage - will hopefully succeed in starting industrialized countries on the right path. But a framework that encompasses both developed and developing countries, and fairly apportions responsibility among them, will have to be more sophisticated. It will have to accommodate the legitimate desire of developing countries to raise their living standards. It will have to recognize that different countries face very different challenges - for developed countries, the challenge is converting from the existing energy infrastructure to a clean one, while for developing countries, it is much more a matter of building the infrastructure right in the first place. An effective global strategy also will have to mobilize the flow of technology, know-how and resources from wealthier nations so that poorer countries are in a position to keep up their end of the bargain. In that sense, our challenge is to ensure not only that the new industrial revolution is launched, but also that its fruits are shared quickly and fairly.

These are my thoughts on where we stand in our effort to spare future generations the grave risks of an overheated planet. Enormous challenges lie ahead. But there are promising signs, both internationally and here in the United States, that we are at last mustering the will to begin confronting them. We must seize on that momentum, and keep moving forward. Thank you.

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Op-Ed: The Climate Challenge Begins at Home

Opinion Editorial
The Climate Challenge Begins at Home

By Eileen Claussen and Elliot Diringer

The Washington Post

August 19, 2001

Now that the rest of the world has resolved to move ahead with the Kyoto global warming treaty, pressure is mounting on the Bush administration to get back in the game.

The administration, surprised that other nations struck agreement last month in Bonn despite U.S. rejection of the treaty, does not yet know how it intends to approach the next round of talks this fall in Marrakech. The advice from Capitol Hill, however, has been clear and remarkably bipartisan. Voting 19-0, the Senate Foreign Relations Committee has urged the administration to return to the negotiating table and to bring with it a new proposal for a retooled Kyoto accord or some other "binding" climate treaty.

In the long run, certainly, no strategy against climate change can succeed unless it secures binding commitments from all countries that are major emitters of greenhouse gases -- a roster, as we all know, led by the United States. But pushing the administration to offer up its vision of a Kyoto alternative is probably not the way to get there. While that may have made sense before the July meeting in Bonn, it is too late now to devise a quick diplomatic fix. Instead, the administration should focus its efforts on the more immediate challenge: launching a national strategy to rein in America's soaring greenhouse gas emissions.

Right now it is more critical that we take concrete steps at home to curb emissions than figure out how to reengage the United States in the broader international effort. The sooner we succeed at the former, in fact, the easier it will be to achieve the latter.

As it happens, prospects are suddenly better than ever for getting legislation through Congress to at least begin laying the foundation for genuine emissions reduction. Bush's rejection of the Kyoto pact not only galvanized international support for the treaty; it sparked a new dynamic on the Hill, where both parties now seem eager to show they're serious about global warming.

Democrat Robert Byrd, of coal-producing West Virginia, and Republican Ted Stevens, of oil-producing Alaska, won quick committee passage for a bill that boosts funding for technology research and gives the administration one year to develop a strategy to stabilize greenhouse gas concentrations in the atmosphere. That, incidentally, is the far-reaching goal of the 1992 Rio climate treaty signed by the first President Bush and ratified by the Senate.

Meanwhile, Dianne Feinstein and Olympia Snowe are leading a bipartisan drive in the Senate to improve the fuel efficiency of SUVs; and Jim Jeffords is using his new perch as chairman of the Senate environment committee to move legislation that would cut carbon emissions from power plants.

Senators John McCain and Joe Lieberman have just teamed up behind an even more ambitious proposal, called "cap-and-trade." Their idea is to set a nationwide cap on emissions and, by letting companies buy and sell emissions credits, allow the market to find the most cost-effective ways to meet it.

"Cap-and-trade" may well be the best way to go. It meets two key tests of an effective, affordable strategy: It sets a binding target, or series of targets, that signals markets to invest in cleaner, more efficient technologies; and it gives companies the flexibility and incentive to cut emissions at the lowest possible cost.

Constructing a workable economy-wide system cannot be done overnight, which is why it is important to start now. McCain and Lieberman say they will meet soon with industry leaders to hear their views on what can be achieved and when, an important first step in designing a system that works for both the environment and the economy.

Meanwhile, there are plenty of immediate steps we can take. For starters, we should require all major emitters to accurately track and disclose their annual greenhouse gas releases. We should create tax credits for new technology development and diffusion, and negotiate arrangements with industry to reduce emissions before mandatory targets are set. And we must ensure that future regulation does not penalize companies that take the lead by acting now.

Achieving the long-term emission cuts needed to avert climate disaster is a monumental undertaking. Our challenge, ultimately, is to wean the global economy from fossil fuels through a second industrial revolution that delivers cleaner alternatives. Fostering better technology is the key, and, given the right signals, the marketplace will do just that. It is government's job to send the right signals.

That has yet to happen here in the United States. American leadership on climate change has been continually undermined by our failure to get our own house in order. Having now abandoned the Kyoto treaty, the United States can return credibly to the negotiating table only when it has shown it is serious about cutting emissions.

We must chart a path that in time will make the United States a full partner in the international effort against climate change. That path begins at home.

Eileen Claussen is president of the Pew Center on Global Climate Change. Elliot Diringer is the center's director of international strategies.

 

© 2001 The Washington Post Company

Appeared in The Wasington Post, Sunday, August 19, 2001— by Eileen Claussen and Elliot Diringer

Greenhouse Action in an Uncertain International Environment

Greenhouse Action in an Uncertain International Environment

Speech by Eileen Claussen, President
Pew Center on Global Climate Change

Electricity Supply Association of Australia

July/August 2001

It is a pleasure to be here in Australia. And I must say it is a relief to get out of the United States, if only for a brief time. Washington politics, as always, seem to be highly partisan, and highly unproductive. The perpetual squabbling between the two political parties reminds me of the story of the young boy who comes home from school with a black eye and torn clothes.

"Which one of you started the fight?" asks his mother.

The boy's response: "It started when the other guy hit me back."

I am also glad to be here because it gives me a chance to escape a typically hot and muggy Washington, DC summer. I actually have a theory that President Bush is reluctant to embrace strong action on global warming because of his avowed interest in shrinking the United States government. You see, the hotter it gets in the summer, the fewer people will want to work in Washington. And the more likely they will be to move to Alaska, where they can engage in more productive pursuits such as drilling for oil.

There may be another reason for the President's reluctance to make this issue a priority. If sea levels rise, as predicted in a warmer world, it is possible that parts of America's East and West coasts will be covered by water. Among the states that will face problems will be such Democratic and left-leaning bastions as California, Massachusetts, New York and Maryland. Coincidence? I think not.

Okay, that is probably enough joking around, and I should move on to the subject at hand. Today I would like to talk about what is happening on the issue of climate change, and why we need to make sure we are doing all we can to address this monumental challenge. I want to touch first on the science of climate change-and, more specifically, on the ever-solidifying scientific consensus that this is a very serious problem that demands very serious action. And then I would like to talk about the importance of effective-and mandatory-efforts to reduce greenhouse gas emissions on a country-by-country basis.

Our goal, as I will discuss, must be to facilitate the arrival of a second industrial revolution. This means doing all we can to accelerate the development of new technologies that will move us closer to a low-carbon world economy.

The Science of Climate Change: A Few Observations

With that, I will proceed directly to a brief discussion of the science of climate change. The Intergovernmental Panel on Climate Change (or IPCC) is a body created by the United Nations to reach scientific consensus about the magnitude and nature of the climate problem. In its Third Assessment Report, approved in January of this year, the IPCC said it now expects the global average surface temperature to rise by between 2.5 and 10 degrees Fahrenheit over the course of the 21st century. This is a much greater increase than the rate projected just five years ago. Even at the low end of the projection, the warming trend is expected to cause significant problems. And the higher-end projections of 10 degrees or more could prove catastrophic.

In a series of reports on the potential environmental impacts of climate change, my organization has looked at such issues as how ecosystems, agriculture and water supplies will be affected. From these assessments, we know that climate change will result in significant shifts in agricultural production because of temperature changes and a probable increase in extreme weather events. We also know that climate-induced changes in the water cycle will affect the availability of water to meet growing demand-which I know is a very real concern here in Australia. And we know that fragile ecosystems will be adversely affected. Consider the problem of coral bleaching, which is already draining the life out of coral reefs in Australian waters and throughout the world-in part, scientists say, because of warming ocean temperatures.

After issuing its new projections of temperature increases around the globe, the IPCC in February released a report that looked at the possible effects of these changes. The report warned of droughts, floods, and increasingly violent storms-all as a result of global warming. This is in addition to a projected sea level rise of up to 3 meters as the West Antarctic and Greenland ice sheets melt. We are just beginning to come to grips with the potential impacts of this degree of sea level rise and how it will affect low-lying coastal areas throughout the world. As you might expect, this is more than a passing concern in developing countries such as Bangladesh, where even a one-meter rise in sea-level would inundate 17 percent of the country.

Studies from the IPCC and others also confirm that greenhouse gases produced by human activities, mainly the burning of fossil fuels, are the principal cause of the continuing warming trend.

I must note here that it is not just U.N.-appointed scientists who are saying these changes are taking place. Just last month, a prestigious panel of U.S. scientists seconded the findings of the IPCC in a study specifically requested by the Bush White House. Even more support for the IPCC findings came in a study just a couple of weeks ago from Tom Wigley of the National Center for Atmospheric Research and Sarah Raper of the University of East Anglia in England. Their conclusion is that there is a 9-in-10 chance that the global average temperature will rise 3 to 9 degrees in the coming century, with a 4-to-7 degree increase most likely.

The bottom line is that if we need a reason to act on this issue, the latest science certainly provides one. The fact that there is uncertainty about exactly how much temperatures will rise or what the precise effects will be should be expected. This is science after all-and science very naturally is built on hypothesis and conjecture. But, increasingly, the science tells us we would be irresponsible not to take the threat of climate change very seriously.

The Significance of the "Kyoto Compromise"

At the same time that we have seen a dramatic and ever-solidifying consensus emerge among scientists about climate change, we have seen the world community-minus one very important player-finally agree on a set of first steps to address the problem.

As all of you know, earlier this month in Bonn, Germany, 178 nations reached a compromise on the rules that will allow the Kyoto Protocol to enter into force. The Protocol, of course, is the agreement first negotiated in 1997 that requires countries to reduce or limit their emissions of greenhouse gases in relation to 1990 levels, with different countries agreeing to different targets. Australia, as you know, actually agreed to a target whereby emissions would be allowed to grow by 8 percent from 1990 to the period between 2008 and 2012. This compared to a business-as-usual scenario where emissions would have grown by significantly more.

In addition to establishing targets, the Kyoto Protocol outlines how countries can achieve their targets-for example, by making real emission reductions at home, by trading emissions credits with others, and by using "sinks" such as farms and forests to remove carbon from the atmosphere. Although many of the details on how these mechanisms will work still need to be decided, the compromise reached in Bonn will likely provide countries with a high degree of flexibility in how they use these various strategies. And this, I believe, is a very important and positive development, since it will permit countries and businesses to meet their objectives in the most cost-effective ways.

But the Kyoto Protocol, as I have already noted, is just a first step on what will be a long march to a less carbon-intensive world. Its initial targets for emissions reductions take us only to the 2008-2012 period, and they represent just a very small down payment on the level of emissions reductions that scientists say we must achieve in order to have a real effect on mitigating climate change.

The ultimate impact of the Kyoto Protocol also will be severely limited by the United States government's decision not to be party to the agreement. The Bush Administration has said repeatedly that it believes Kyoto is fatally flawed and not acceptable to the United States. Granted, the Protocol does have its problems-it is, after all, an agreement of approximately 180 countries with differing aspirations, differing economies, and differing views of the environment. But I believe that the other nations of the world, in agreeing to a compromise solution in Bonn, decided to send a message to the United States that an imperfect agreement is better than none-and that we cannot wait any longer to take this crucial first step to solving the most important environmental issue facing the world today.

Still, for the global effort to address this issue to be truly effective, the United States, which is the largest generator of greenhouse gas emissions, ultimately will have to have an effective program in place to reduce its emissions, and hopefully, an interest in participating in a global agreement. In addition, many countries in the developing world will have to play larger roles in reducing global emissions in the years ahead. As these nations develop, they will need to do so in ways that are less carbon-intensive and more efficient. This is a challenge they do not face alone-the time has come for all nations of the world, developing or already developed, to consider how best to grow their economies while at the same time reducing the impact of their growth and development on the global environment.

A Second Industrial Revolution

An international framework is an essential element in any effort to address global climate change. We are dealing with a global problem, and it requires a global solution. But the ratification and entry into force of the Kyoto Protocol will not alone produce results. It must be accompanied by domestic action in all countries to reduce or limit greenhouse gas emissions through innovative tax policies, mandatory requirements, and other steps.

It is these types of measures, I believe, that will play an enormously important role in speeding the advent of what I refer to as a second industrial revolution. This will be a revolution characterized more than anything else by a growing reliance on low-carbon and even no-carbon energy sources to power the world's continuing economic development and growth.

At the same time that we must embrace the possibility of "decarbonizing" our economies, we must also be realistic about what can be done and in what time frame. All of our countries will continue to use petroleum and coal for many years to come. The challenge with respect to these traditional fuel sources will be to promote ever-increasing levels of efficiency and conservation at the same time as we work to develop and deploy cleaner energy sources for the future. Looking at coal, which today accounts for 84 percent of electricity generation here in Australia (and 31 percent in the United States), we need to find and embrace cleaner-burning ways of using it. And we need to think seriously about sequestering coal-related carbon dioxide emissions.

But these steps will clearly not be enough. The bottom line is that we need new technologies to meet the energy and environmental challenges we face. To effectively address climate change, we need to lower carbon intensity, become more energy efficient, promote carbon sequestration, and find ways to limit emissions of non-CO2 gases. This will require fundamentally new technologies, as well as dramatic improvements in existing ones. New, less carbon-intensive ways of producing, distributing and using energy will be essential. The redesign of industrial processes, consumer products and agricultural technologies and practices will also be critical.

These changes can be introduced over decades as we turn over our existing capital stocks and establish new infrastructure. But we must begin making investments, building institutions, and implementing policies now.

Creating the international framework that will encourage and enable these actions is an essential step. This is why the compromise reached in Kyoto this month is so important. But in the end, what truly matters is what individual countries and individual businesses (and even individuals) do to reduce their individual contributions to the problem. Just as we need legally binding commitments at the global level, it is, yes, mandatory that we enact mandatory programs on a country-by-country basis. In the United States, we have had voluntary efforts in place for much of the past decade, and still we have seen a dramatic rise in emissions - almost 12 percent over 1990 levels. In Australia, it is much the same. Despite a strong government effort to enlist industry in voluntary emission reduction programs, emissions here have risen to 18 percent over 1990 levels.

Industry Takes the Lead

This is not to discredit or discount the important steps that many companies are taking to reduce their greenhouse gas emissions on a voluntary basis. About half of the 36 companies that are part of the Pew Center's Business Environmental Leadership Council have set specific, quantitative targets to reduce their greenhouse gas emissions, and others are working toward establishing these objectives. Consider DuPont, a corporation that is well on its way to achieving its goal of reducing carbon dioxide emissions by 65 percent before 2010, relative to 1990 levels.

Other companies, too, are making process and efficiency improvements that are yielding real reductions in emissions. The energy company Enron, for example, reduced its greenhouse gas emissions by controlling leaks in its natural gas pipelines. And TransAlta Corporation improved its energy efficiency by about 4 percent when it upgraded old, less efficient turbines and other systems.

In addition to these types of steps, some companies are investing in dramatic changes to their production processes. Alcoa, for example, is developing a new technology for smelting aluminum that, if successful, will allow the company to reduce its greenhouse gas emissions to half their 1990 levels over the next nine years. Similarly, Shell aims to achieve its greenhouse gas reduction target by revamping its disposal of the waste gases resulting from oil and gas production.

Still other companies are venturing into new markets or shifting their business focus entirely. ABB is a $25 billion Swiss business-to-business supplier that has divested itself of traditional, large-scale power generation businesses. Instead, the company now supplies distributed energy solutions, such as combined heat and power technology, fuel cells, microturbines, and wind power plants. Likewise, Shell is planning a long-term transition into the renewable energy market, having invested $1 billion in renewables to date.

All of these are important developments-and they show how increasing numbers of leading companies see a clear business interest both in reducing their emissions and in helping to shape the energy economy of the future. Interestingly, if you look at who's paying the most attention to these issues, you find that industry and not government seems better prepared to lead the way to low- or no-carbon energy solutions. Even some of the largest oil companies are investing in the technologies and experimenting with the strategies that will ultimately decarbonize the energy economy and move us from petroleum-based fuels to hydrogen and other sources.

Industry, I believe, is leading the way because these companies are, by necessity, more nimble and more innovative than government, and more attuned to what the future holds. This does not mean there is no role-or even a minimal role-for the world's governments in ensuring that the process moves ever forward. To quote from a series of articles on the global energy future in The Economist: "The invisible hand may be ascendant, but that does not mean that the visible one has become irrelevant."

The Role of Government Action

The voluntary steps that are being taken by the leading companies throughout the world are dramatic and important, but they are obviously not enough. Government can and must play a critical role in establishing the ground rules for the energy economy of the future. These ground rules, in turn, will help to send signals to industry about the need to develop and deploy new technologies.

In the end, there is little incentive for any company to undertake real action unless, ultimately, all do-and unless all are in some manner held accountable. Markets, of course, will be instrumental in mobilizing the necessary resources and know-how. Market-based strategies such as emissions trading will also help deliver emissions reductions at the lowest possible cost. But markets can move us in the right direction only if they are given the right signals.

I already mentioned the most recent IPCC projections-temperature increases of up to 10 degrees worldwide, together with the accompanying impacts on sea level and weather extremes. As these impacts become more real to people, and as governments and businesses begin to come to terms with the dramatic effect of climate change on our economies and our communities, I believe we will see a dramatic increase in attention and investment going to those energy sources that hold the potential of reducing carbon output and mitigating climate change. This may not happen next year or the year after that, but it will surely happen, because there is only so long that the world-or even one country-can remain in denial about the serious and undeniable threats posed by our changing climate.

In closing, I want to make it clear that the future I am talking about is not a future in which the world uses less energy. Rather, it is a future in which economic growth begins to occur independently of the steady growth we have seen in carbon dioxide emissions. And it is a future in which we realize once and for all that we can indeed achieve our goals for our economies and our businesses while at the same time protecting the global environment.

Thank you very much. 

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Press Release: New Reports Highlight Opportunities to Curb Growth of Transport Sector Emissions in Developing Countries

For Immediate Release:  
July 20, 2001

Contact: Katie Mandes, 703-516-4146
   Dale Curtis, 202-777-3530

New Reports Highlight Opportunities to Curb Growth of Transport Sector Emissions in Developing Countries

Delhi, Shanghai studies identify low-cost policies that also improve traffic and air quality

(BONN, Germany) - Greenhouse gas emissions from cars and other vehicles are likely to soar in Delhi and Shanghai over the next two decades, but could be substantially curtailed through public and private sector initiatives that would also ease traffic congestion and cut air pollution, according to two new reports released today by the Pew Center on Global Climate Change.

The reports' authors found that transport-related greenhouse gas emissions could rise as much as fourfold in Delhi, and sevenfold in Shanghai, by 2020. Policies that promote cleaner technologies, public transit and other transportation alternatives could cut the projected emission increases by as much as half, the authors concluded.

"One of the greatest challenges we face in addressing climate change is helping developing countries forge cleaner, more sustainable paths to development," said Eileen Claussen, president of the Pew Center, an independent U.S.-based organization. "These reports identify ways that fast-growing cities like Delhi and Shanghai can meet the demand for high-quality transportation while easing congestion, improving air quality, and protecting the global climate."

The team of experts that produced the Delhi report was led by Ranjan Bose of the Tata Energy Research Institute in New Delhi, and Daniel Sperling of the Institute of Transportation Studies at the University of California at Davis. The Shanghai team was led by Hongchang Zhou of Tongji University in Shanghai and Daniel Sperling.

The Delhi and Shanghai reports are the first in a series of five examining transport-related greenhouse gas emissions in developing countries. Case studies of Chile and South Africa, and an overview report, will be released later this year. Earlier Pew Center reports examined the electric power sectors in Argentina, Brazil, China, India and the Republic of Korea.

Delhi: Challenges and Opportunities

Delhi's high scooter and motorcycle ownership rates show that demand for personal mobility can be achieved even at low income levels. Per capita and aggregate greenhouse gas emissions are relatively low, but are poised to increase dramatically. The projected increase in two-wheeled vehicles and cars threatens to bring rising respiratory illness, more chronic traffic jams, further disenfranchisement of the poor, and greater obstacles to economic development.

Under the report's "business-as-usual" scenario, transportation-related greenhouse gas emissions could increase fourfold between 2000 and 2020. An aggressive effort to encourage environmentally friendly forms of travel could reduce the projected increase to a doubling. Low-cost, incremental policy options include:

  • Building and maintaining more sidewalks, and bicycle and bus lanes;
  • Replacing inefficient, highly polluting engines in scooters and motorcycles;
  • Improving fuel efficiency of cars; and
  • Improving public transit and expanding charter bus services.

T he authors also discuss more fundamental changes that could have deeper, longer-term impacts, including integrated land-use planning and faster introduction of advanced vehicle and information technologies.

Shanghai: Building on Past Success

Shanghai's transportation sector currently generates extremely low levels of greenhouse gas emissions for a city of its size and affluence. But emissions are expected to soar four- to sevenfold due to the city's efforts to reduce its very high population density and the anticipated increase in automobiles following China's accession to the World Trade Organization. City planners project a quadrupling of the number of cars and trucks in operation by 2020.

Shanghai has already established a highly competent transportation system and large investments are being made in new infrastructure and the coordination of transportation modes. The city is investing in rail and bus transit and "intelligent" transportation technologies. To the extent Shanghai can restrain motorization and emissions, it may serve as a model for other cities in the developing world.
Low-emission policies include:

  • Specialized infrastructure for smaller vehicles and bicycles;
  • Promotion of small cars and clean, efficient motorcycles and scooters;
  • More and better express bus service;
  • Greater use of information and communication technologies; and
  • Cleaner engine technologies in conventional vehicles.

T he full text of both reports is accessible on the Internet at http://www.c2es.org. The site also offers information on the science and economics of climate change, potential solutions, and the activities of the Pew Center and its Business Environmental Leadership Council.

 

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The Pew Center was established in May 1998 by The Pew Charitable Trusts, one of the United States' largest philanthropies and an influential voice in efforts to improve the quality of the environment. The Pew Center is an independent, nonprofit, and non-partisan organization dedicated to providing credible information, straight answers and innovative solutions in the effort to address global climate change. The Pew Center is led by Eileen Claussen, the former U.S. Assistant Secretary of State for Oceans and International Environmental and Scientific Affairs.

Transportation in Developing Countries: Greenhouse Gas Scenarios for Shanghai, China

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Transportation in Developing Countries: Greenhouse Gas Scenarios for Shanghai, China

Prepared for the Pew Center on Global Climate Change
July 2001

By:
Hongchang Zhou, Tongji University, Shanghai
Daniel Sperling, Mark Delucchi, and Deborah Salon, Institute of Transportation Studies, University of California, Davis

Press Release

Download Entire Report (pdf)

Foreword

Eileen Claussen, President, Pew Center on Global Climate Change

The transportation sector is a leading source of greenhouse gas (GHG) emissions worldwide, and one of the most difficult to control. In developing countries, where vehicle ownership rates are considerably below the OECD average, transport sector emissions are poised to soar as income levels rise. This is especially true for China, whose imminent accession to the World Trade Organization will contribute to economic growth and could make consumer credit widely available for the first time. These factors are likely to accelerate automobile purchases, and GHG emissions.

Shanghai is one of China's most dynamic cities. Extremely densely populated, with very low personal vehicle ownership rates for its income level, Shanghai is also home to a nascent Chinese automotive industry. Transportation plans and policies there are designed to achieve broader urban objectives of population decentralization, with an eye to controlling increases in traffic congestion and improving environmental quality. Because Shanghai's transportation system and planning process are so sophisticated, Shanghai may be a 'best case' for controlling transportation sector GHG emissions in the absence of climate change mitigation goals.

This report creates two scenarios of GHG emissions from Shanghais transportation sector in 2020. It finds:

  • Greenhouse gas emissions quadruple in the low-GHG scenario; they increase sevenfold in the high scenario. On a passenger-kilometer basis, the estimated increase ranges from 10 to 100 percent.
  • Providing an array of high-quality options to travelers can help meet the demand for transportation services while keeping traffic congestion in check and meeting other urban objectives.
  • Special lanes and other infrastructure to accommodate vehicles such as buses, minicars, and bicycles can save money and improve traffic circulation.
  • Using clean technology and fuels in motorized vehicles lowers the environmental impact of various transportation modes.
  • Perfecting the use of 'intelligent' traffic control systems through improved coordination will yield higher returns on capital investments.

Transportation in Developing Countries: Greenhouse Gas Scenarios for Shanghai, China is the second report in a series examining transportation sector GHG emissions in developing countries. The report's findings are based on a Lifecycle Energy Use and Emissions Model developed by the Institute of Transportation Studies at the University of California at Davis, which estimates GHG emissions from the transportation sector.

The Pew Center would like to thank Kebin He of Tsinghua University, Feng An of Argonne National Laboratory, Ralph Gakenheimer of MIT, and Michael Walsh, an independent transportation consultant, for their review of earlier drafts. 

Executive Summary

Shanghai is experiencing rapid economic growth. Affluence is motivating dramatic and far-ranging changes in urban structure, transportation, and energy use. This report examines two transportation trajectories that Shanghai might follow and how they would affect greenhouse gas (GHG) emissions. Shanghai’s metropolitan population of over 13 million people continues to grow relatively slowly, but its economy is growing rapidly. The average annual per capita income is $4,000, three times higher than the rest of China, and the Shanghai economy is expected to grow at more than 7 percent per year through 2020.

Massive new transport system investments planned for the next two decades are aimed at lowering Shanghai’s extremely high population density, supporting economic growth, and enhancing the quality of life. The list of new investments is impressive: expansion of the new airport, construction of a deep-water harbor, three new bridges and tunnel river crossings, completion of a 200-kilometer modern rapid transit rail system, expansion of suburban highways, and construction of 2,000 kilometers of new and upgraded urban roads. These investments will improve the city's transportation system, but are costly and threaten greater energy use and air pollution.

A central issue in Shanghai’s development is the role of personal vehicles, especially cars. The city currently devotes little land to roads and has only 650,000 cars and trucks — very few of which are privately owned — placing vehicle ownership levels well below virtually all cities of similar income. Even with this small number of vehicles, Shanghai already suffers from serious transport-induced air pollution and traffic congestion.

Shanghai city planners project a quadrupling of cars and trucks in the city by 2020. This projected increase is premised principally on two factors. First is rapid income growth, which will make car ownership possible for a much larger segment of the population. And second is vehicle prices, which are likely to plummet due to China’s imminent accession to the World Trade Organization (WTO). Lower prices will result from increased competition, compulsory reductions in vehicle tariffs, and easier access to consumer credit.

These projected increases in vehicle use are not certain.  Even apart from the WTO membership, vehicle ownership and use--and GHG emissions--will be strongly influenced by three interrelated policy debates: industrial policy toward the automotive industry, air quality policy, and transportation and urban growth policy.

The city's decision about vehicle use will be critical in shaping Taiwan's future.
This report addresses the forces about to transform the transportation system of Shanghai, and examines policies and strategies that that direct it toward greater economic, social and environmental sustainability.

The two transportation scenarios draw upon extensive interviews with decision-makers and experts in Shanghai and Beijing.  One scenario is premised on rapid motorization, the other on dramatic interventions to restrain car use and energy consumption, resulting in lower GHG emissions.  Neither is the "business-as-usual" scenario, since this characterization is meaningless in a time of massive investments and policy shifts.  Instead, these scenarios are meant to estimate likely upper and lower bounds of greenhouse gas emissions from Shanghai transport in 2020, taking as given the projected strong economic growth.  If the economy grows more slowly, emissions will likely be lower than the scenarios indicate.

The rapid motorization scenario is based on the projected quadrupling of cars by 2020, coupled with a substantial increase in population.  It results in a seven-fold increase in GHG emissions.  The restrained scenario results in a four fold increase in GHG emissions.  In this restrained scenario, almost all emissions growth is due to increase in travel, not increases in energy intensity or GHG intensity of the travel.  Emissions per passenger-kilometer increase only about 10 percent the restrained scenario compared to a doubling in the rapid motorization scenario.

Caution is urged in generalizing the findings of this report to other cities in developing nations.  Shanghai is not a typical Asian city, given its surging economy and its world-class planning capabilities.  However, the conditions for alternative transportation options are more propitious here than perhaps any other megacity in the world.  If the city is effective at restraining growth in vehicle use (and GHG emissions), Shanghai may serve as a model for other cities in the developing world. 

Daniel Sperling
Deborah Salon
Hongchang Zhou
Mark Delucchi
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Making Collaboration a Matter of Course: A New Approach to Environmental Policy Making

Making Collaboration a Matter of Course: A New Approach to Environmental Policy Making

Speech by Eileen Claussen, President
Pew Center on Global Climate Change

Society of Environmental Professionals Meeting
Washington, DC

June 25, 2001

Thank you very much. It is a pleasure to be here with a group of environmental professionals from around the country. And I must say I am glad you have all gathered here in Washington. Judging from what's been going on over the last several months—and, indeed, over the last several years—this town could certainly use a few more environmental professionals.

Allow me to begin my remarks with a little bit of equal-opportunity criticism of the two political parties' approaches to these issues. In the White House, it seems we have an administration that believes environmental policy-making consists entirely of deciding which of the environmental policies of the previous administration to keep in place, and which to unceremoniously send away to the local landfill. And, among the Democrats on Capitol Hill, the idea seems to be to charge an enormously high political "tipping fee" for the dumping of established policies, regardless of their merit.
I suppose you could sum up the Bush administration's approach to environmental policy by using the EPA's three R's for managing solid waste: reduce, reuse and recycle. As in, reduce environmental regulation while reusing and recycling proposals from the past. The Democrats, meanwhile, have their own three-R strategy for dealing with the environment and other issues: recruit recalcitrant Republicans.
Seriously, all of you are to be commended for your commitment to the environment and for advocating on behalf of sound and responsible environmental policies. In my remarks today, I would like to talk a little bit about how sound and responsible policies can and should be crafted in a world that is very different from the one that greeted the heyday of U.S. environmental policy making in the 1970s. And I want to tell you a little bit about how two organizations I am affiliated with—the Pew Oceans Commission and the Pew Center on Global Climate Change—are trying to adopt a new, cross-sector approach to getting things done.
But first a little history. My own career as an environmental professional began in the 1970s, when I joined the staff of the Environmental Protection Agency. I worked at EPA for more than 20 years and dealt with issues from hazardous waste and energy efficiency to acid rain and the depletion of the ozone layer. And let me assure you that this was a real education for someone whose academic degrees are in English literature.
From EPA I moved onto the National Security Council and then the Department of State, where I was responsible for developing and implementing policy on such international issues as climate change, chemicals, fisheries and wildlife conservation, and more. I left the Clinton Administration in mid-1997, created the Pew Center on Global Climate Change in 1998 and, in 2000, helped launch the Pew Oceans Commission.
The reason I offer you this quick resume is not because I am looking for a job, although I can provide references if you would like. Rather, I simply want to make the point that I have been in the environmental policy arena very literally since the first Earth Day. And, in that time, I have had the opportunity to gain an up-close-and-personal view of the U.S. government's role in these issues. It all began when federal policy makers carved out a very assertive and, in many respects, unilateralist role for Washington in the protection of our natural environment.
This role was spelled out very clearly in the National Environmental Policy Act of 1969. This is the law in which Congress boldly declared its intent to "create and maintain conditions under which man and nature can exist in productive harmony," and to "assure for all Americans safe, healthful, productive, esthetically and culturally pleasing surroundings." (Sort of the chicken in every pot approach to environmental policy.)
During the 1970s, our national policymakers took this vision of strong government action on the environment and made it real. NEPA and the creation of the Environmental Protection Agency were just the start of it. There was the Clean Air Act of 1970, the Clean Water Act of 1972, the Safe Drinking Water Act of 1974, and much more.
Former New York Times reporter Philip Shabecoff, in his recent book about American environmentalism, Earth Rising, had this to say about environmental policy making in the 1970s:

"In its totality, the explosion of congressional activism that produced these landmark environmental statutes must be considered one of the great legislative achievements in the nation's history."

And, as we all know, it was an explosion of activism that produced very real results—two-thirds of the nation's waters now safe for fishing and swimming, up from one-third in 1970; dramatic improvements in air quality due to reductions in carbon monoxide, lead, ozone, particulates and other pollutants.
In spite of these successes, however, government began to see its role a little differently as the years went by. Rather than requiring the best available control technologies and adopting a prescriptive approach to environmental protection, we began to see a still-strong government experimenting with the notion of setting objectives and then allowing industry and the market to figure out how best to meet them.
A perfect example of this performance-based approach was the Acid Rain Program created under the Clean Air Act Amendments of 1990. These provisions require significant reductions in emissions of sulfur dioxide and nitrogen oxides from electric utilities, but the law set out to accomplish this objective in a new way.
Rather than saying here's what the utilities have to do, the implementing regulations established a cap on national emissions while allocating pollution allowances to individual sources for trading. The results are now well known: in the first year of compliance in 1995, U.S. SO2 emissions dropped by a very impressive 3 million tons. And there have been even greater improvements in the years since, along with sharp declines in acid deposition. Perhaps most importantly, the costs of the new requirements have been far lower than anticipated. The acid rain cost projections were estimated at over $900 per ton. They are now selling for less than $150.
A flexible, market-based approach to reducing emissions was not the only innovation we tried under the Acid Rain Program. To successfully implement the program, EPA followed the guidelines of the Federal Advisory Committee Act and established an Acid Rain Advisory Committee. This group included 44 individuals representing a wide range of organizations and interests, from large and small utilities to environmental organizations and state air agencies.
Bear in mind that this was not a window-dressing committee. It actually did a lot of good, hard work. Over a six-month period, this group (and I chaired it) became actively involved in formulating solutions to problems and offering critiques of various regulatory options. Not only did this ensure that potential problems were identified early on, but it also helped smooth the way for implementation of the new rules. The reason: there was a cadre of individuals who already were very familiar with the program and the thinking behind it, and who were committed to making it work.
So over the years our government has moved from prescribing what industry should do, to establishing performance standards for industry to meet, to beginning to involve stakeholders directly in the formulation of new policies and regulations. When you dig beneath the surface, however, the success of the Acid Rain Advisory Committee is the exception to the rule. All too often, our government's outreach to industry and other sectors is doomed from the start because these partnerships and collaborations often lack a clear sense of mission and goals. They also often lack a clear definition of roles and responsibilities. Adding to the problem, government entities are notoriously reluctant to relinquish control of the policy process to others. And this, I believe, must change.
My point is that environmental threats such as rising levels of greenhouse gas emissions, the deteriorating health of our oceans, and the wasteful destruction of natural resources will pose serious and mounting problems for both the United States and the world in the decades ahead. And we will not be able to deal effectively with these problems without a better system of environmental governance—governance that includes an active and appropriate role not just for government but for business, nongovernmental organizations, scientists, citizens and others.
The world is very different today than it was in the 1970s—this despite the recent return of such 70s icons as Charlie's Angels, Fleetwood Mac, bell-bottoms and the entire administration of President Gerald R. Ford. It is even a different world today than it was in the early 1990s, at least with respect to the power and capacity of government to unilaterally shape the nation's environmental policies.
So what has changed? The answer is a number of things, starting with the government itself. Between 1968 and 2000, the United States had a divided government for all but six years—and, as of last month, it was divided yet again. While in the 1970s you saw a unique consensus emerge among Republicans and Democrats alike around the importance of strong action on the environment, today the issue is much more partisan in nature—and the result is a lack of sustained leadership. Like many other issues in today's highly competitive political arena, the environment is used far too often as a way to score political points—and not often enough as a way to bring Americans together behind an agenda for action.
At the same time that environmental issues have become more polarized and politicized, we also have seen a devolution of authority away from the federal government and towards the states and localities. This happened in part because the environmental laws enacted in the 1970s were designed to build capacity at the state level. And the fact is, they did precisely that. Devolution has not necessarily meant less environmental protection. But it has meant that the states are increasingly interested in adapting national objectives to individual state circumstances. And the result is a patchwork of policies, some of them stronger than others and all of them serving as a collective reminder that Washington is no longer the policy making force it once was on the environment.
Among the other factors that have contributed to Washington's declining capacity to make and enforce strong environmental policy are budgetary pressures that are sure to persist in the wake of the tax cut approved by Congress in May. And then there is the state of environmental science. Recent years have seen the emergence of a sizeable body of scientific consensus supporting the need for action to address most of the environmental problems we face. Nevertheless, as time has gone on, our ability to understand the uncertainties in the science has also improved.
And this has meant a tendency in the political arena to focus on uncertainties rather than certainties—making it difficult for policy makers to take strong or effective action on these issues. The unfortunate result is that science—which is the necessary underpinning for action—too often is employed in the cause of those who wish to take no action at all.
At the same time that we have seen our government become weaker and more inclined to inaction on the environment, we have seen nongovernmental organizations become ever-stronger. The 1997 Mine Ban Treaty, to cite one example, was largely the product of NGOs throughout the world coming together around a common concern and persuading world governments to take action. In the environmental arena, we have seen nongovernmental organizations enter the mainstream of society. Twenty or thirty years ago, these groups essentially operated on the fringe of politics and governance, advocating for sound environmental laws and suing the government to make sure that the laws were implemented. Today, however, these groups have developed into sophisticated and, dare I say it, "corporate" organizations that act not only as advocates but as lawyers, communicators, educators, and policy analysts.
These changes in the not-for-profit sector have been accompanied—perhaps not coincidentally—by a growing sensitivity to environmental concerns in the private sector. Many businesses in the United States and throughout the world no longer view environmental concerns as a threat to their very existence. Rather, progressive business leaders (and not all business leaders are progressive) accept that something must be done to address these concerns, and they understand that the smartest approach for industry is to help shape solutions instead of having solutions imposed by others.
Both independently and in response to pressure from government, NGOs and the communities where they operate, many companies have now embedded social and environmental ethics into their management structures. This makes the blatant disregard of the environment far more difficult, and it opens the door to a more constructive role for the private sector in identifying and solving environmental problems.
So there you have it. Our government is weaker, NGOs are stronger, and industry is more attuned to the environmental consequences of its actions. Looking at these trends, and coupling them with the ease of modern communications and the growth of the internet, you start to see the outlines of a new approach to environmental policy making.
Some have argued for greater self—policing by the private sector-based on the belief that it is in industry's best interests to deal aggressively and responsibly with these issues. But I am talking about something different. I am talking about a governance model that requires a heightened level of interaction and cooperation among government, NGOs, industry and others—an approach that draws on everybody's strengths, interests and expertise to forge solutions that everybody can support.
Can this approach work to achieve progress on other issues from cleaning up our air and water to reducing the risks of climate change and protecting the health of the oceans? My answer is yes. At the Pew Oceans Commission, we have sought to assemble government, fishing industry and NGO representatives—together with scientists, economists and others—to recommend a series of policy measures designed to restore and sustain the health of the marine environment. This is a bipartisan, multi-sector group that includes members from all of the coastal regions of the nation, as well as federal, state and local governmental perspectives.
And we are not stopping there in our efforts to reflect a truly national, cross-sector consensus on these issues. In a continuing set of workshops and other convenings throughout the country, we are inviting the public to share its concerns about ocean issues. And we are hearing from local commercial fishers, business people from tourism and agriculture, and regional officials and scientists about ways to improve ocean management and conservation.
The result of all this will be a set of policy recommendations that we will present to Congress in 2002. Our intention is for these recommendations to be substantive, bold and visionary rather than a watered-down list appealing to the lowest common denominator. And we believe that by working through these issues together, with all of the stakeholders at the table, we will make a real and substantive contribution while raising the profile of ocean issues among the American public.
At the same time that the Pew Oceans Commission is applying a new governance model to the making of ocean policy, the Pew Center on Global Climate Change is reaching out in different and more targeted ways. We now have 33 major companies that are part of the Pew Center's Business Environmental Leadership Council. This is a group of industry leaders who have come together based on the belief that we know enough about the science of climate change to begin taking concrete steps now to reduce emissions of greenhouse gases. And that is precisely what these companies are doing — they are reducing their emissions, some very substantially, and they are playing a constructive role in the domestic and international policy debates on this issue.
In addition to working with our Business Environmental Leadership Council, the Pew Center is collaborating with top scientists and other experts to produce authoritative analyses of the environmental impacts of climate change, as well as the economics and the public policy issues involved. And, we are working with government representatives and other NGOs, both here in the United States and throughout the world, in an effort both to move the dialogue on this issue forward and to forge innovative policy solutions.
The more I work at both of these efforts—the Pew Oceans Commission and the Pew Center on Global Climate Change—the more I am convinced that very little can be accomplished today in the environmental policy arena without the active participation and support of businesses, NGOs, scientists and others. And one of the principal reasons for this is the sheer size and complexity of the environmental agenda today.
Think about it. Included among the issues that demand the attention of government, industry, NGOs and others is a wide range of topics that touch on virtually every aspect of our relationship with the natural environment. On a global scale, we're seeing problems and potential crises involving the atmosphere, oceans and biodiversity. And, at the national and regional levels, the issues include everything from air and water pollution to water and land use issues, toxics, the destruction of forests, and more.

To see how the prevailing model of environmental governance is not delivering the results we need, one has only to take a cursory look at where things stand today on the two issues that are currently the focus of my work.
First there is the issue of climate change. Most of the world's best scientists now agree that the global climate is changing in important and alarming ways, and that these changes have serious consequences for the environment and human life. But we have yet to show that sustainable international and national regimes for mitigating climate change can get off the ground.
With respect to the actions of the current Administration, allow me to state very clearly that it does no good to flat-out reject one approach to this issue—and, equally important, an approach that reflects years of hard work and consensus building among the world's governments—before considering what a better approach might be. That said, our inability to develop a responsible and thoughtful national policy on the issue of climate change is a problem that dates to well before the current President. While the Clinton administration agreed to a tough emissions reduction target in Kyoto, Japan, in 1997, it never put forward anything approaching the kind of domestic strategy that would be required to meet it.
And then there are the oceans. Overfished and polluted, our seas are in trouble. Approximately 70 percent of commercially important fish stocks are fully or over-exploited. And every year, 27 million tons of fish, marine mammals and birds are caught unintentionally and thrown back dead or dying into the sea. We have several pieces of national legislation addressing these issues, and a handful of institutions and treaties are in place at both the regional and global levels. But none of these efforts has yet been able to respond effectively to the problems of unsustainable fishing practices, pollution, and other threats to ocean ecosystems and marine life.
So the bottom line is this: what we have done until now is not working to address the environmental problems of today. Despite high-profile events such as the 1992 Earth Summit, and despite such groundbreaking achievements as the Clean Air and Clean Water Acts and the Montreal Protocol, our environment is still very much at risk. And what needs to happen now is for all of us to come together—governments, businesses, NGOs and others—and to form new collaborations, new models of environmental governance.
What are the ingredients that will make these collaborations successful? Let me list a few. First, we need a vision of where we are going and where we must go. Second, all the major stakeholders have to believe that the problem is real and needs to be addressed. Third, those who do good voluntarily shouldn't be penalized if doing good becomes mandatory down the line. Fourth, all the players have to be willing to take risks. Fifth, business has to put what it knows on the table, since the private sector generally has the most useful information. And, last but not least, NGOs have to buck the heat and say that compromise is acceptable.
In closing, I would like to tell you all a joke I recently heard. A Little League baseball game is under way, and one of the coaches pulls one of his young players aside to ask a question.
"Do you understand what cooperation is? What a team is?" the coach asks.
The little girl nods in the affirmative.
The coach then asks another question: "Do you understand that what matters is whether we win together as a team?"
The little girl nods yes.
"Do you understand," the coach continues, "that when a strike is called, or you're out at first, you don't argue or curse or attack the umpire. Do you understand all that?"
Again the little girls nods yes.
"Good," says the coach. "Now go over there and explain it to your mother."
Just like that little girl and her mother, all of us in the environmental arena need to understand anew what cooperation means and what it means to work together as a team. There is no other way, I believe, to achieve true progress in meeting the many environmental challenges we face today.
Thank you very much.

Op-Ed: Moving Forward at Home and Abroad

OPINION EDITORIAL
Climate Change: Moving Forward at Home and Abroad

Eileen Claussen
Joint Center Policy Matters
www.aei.brookings.org

June 2001

There has been much argument in the United States over whether the Kyoto Protocol is an appropriate first step in the effort to find a global solution to the challenge of climate change. But the question of Americas rightful role in the fight against global warming extends far beyond the diplomatic realm. The real hurdles are on the domestic front, for truly addressing climate change will require serious and sustained effort across virtually every sector of the U.S. economy. Ultimately, what the United States can deliver internationally hinges on what it can and is prepared to do at home. For the United States—and hence, the world—to effectively combat climate change, it is critical that our domestic and diplomatic strategies proceed in tandem.

So far, unfortunately, they have not. While the Clinton administration agreed to a tough emissions reduction target in Kyoto, it never put forward anything approaching the kind of domestic strategy that would be required to meet it. In fact, while we have had some discussion in the United States on what other countries should do, we have not had a serious debate about what we ourselves are willing to do. What we need is a national dialogue, with serious arguments about costs, benefits, and fairness. Only if we achieve something approaching a national view, broadly supported by the American people, our legislative representatives and our President, can we successfully address this issue.

In assessing how the United States could or should proceed domestically and, in turn, internationally, it is important to recognize certain defining characteristics of the climate challenge, and what they imply for the effort required to meet it. First, climate change is truly a global challenge: Averting the worst consequences of global warming ultimately requires action by all major emitting nations. Second, it is a long-term challenge. Reducing emissions to the levels necessary to prevent serious climate disruption will take many decades because it essentially requires a new industrial revolution—one enabling the broad introduction of low-carbon technologies to power a growing global economy.

Much as some would like to believe otherwise, it will be extraordinary difficult if not impossible to muster the kind of global, sustained effort that is needed without the force of legally binding commitments. There is little incentive for any country—or any company—to undertake real action unless, ultimately, all do, and are in some manner held accountable. Markets, of course, will be instrumental in mobilizing the necessary resources and know-how; market-based strategies such as emissions trading also can help deliver emissions reductions at the lowest possible cost. But markets can move us in the right direction only if they are given the right signals. In the United States, those signals have been neither fully given nor fully accepted.

So what would constitute an effective domestic program to reduce greenhouse gas emissions? To date, efforts to reduce U.S. emissions have been limited almost exclusively to voluntary activities at the federal, state, local and corporate level. Spurred on by the United Nations Framework Convention on Climate Change, to which the United States is a party, a number of these efforts have resulted in significant emission reductions. Some companies, for example, have cut emissions 10 percent or more from 1990 levels. And while technology has enabled the energy intensity of products and processes to decrease over the last 50 years, the increased efficiency has been outpaced by increased demand driven by economic expansion, population growth, and changing consumer preferences. In the aggregate, voluntary efforts have not ended overall growth in U.S. emissions. Indeed, U.S. emissions grew approximately 12 percent over the past decade. The lesson here is clear: voluntary programs can make a contribution but will not, on their own, be enough.

What would? To effectively address climate change, we need to lower carbon intensity, become more energy efficient, promote carbon sequestration, and find ways to limit emissions of non-CO2 gases. This will require fundamentally new technologies, as well as dramatic improvements in existing ones. New, less carbon-intensive ways of producing, distributing and using energy will be essential. The redesign of industrial processes, consumer products and agricultural technologies and practices will also be critical. These changes can be introduced over decades as we turn over our existing capital stocks and establish new infrastructure. But we must begin making investments, building institutions, and implementing policies now.

Three decades of experience fighting pollution in the United States have taught us a great deal about what works best. In general, the most cost-effective approaches allow emitters flexibility to decide how best to meet a given, binding emissions limit; provide early direction so targets can be anticipated and factored into major capital and investment decisions; and employ market mechanisms, such as emissions trading, to achieve reductions where they cost least. To ease the transition from established ways of doing business, targets should be realistic and achievable. What is important is that they be strong enough to spur real action and to encourage investment in development of the technology and infrastructure needed to achieve the long-term objective.

A good first step is to get our house in order by immediately requiring accurate measurement, tracking and reporting of greenhouse gas emissions. Current efforts lack rigorous reporting standards and verification requirements. Public disclosure of the reported data, similar to what is required for certain pollutants under the federal Toxic Release Inventory (TRI) program, would encourage companies to hunt for ways to reduce their greenhouse emissions.

There are other ways we can and should spur companies to act ahead of any mandatory requirements. One is for the government to enter into voluntary enforceable agreements with companies or sectors willing to commit to significant reductions—either in process emissions, or those from the use of products they make (e.g. automobiles or washing machines). In exchange for its commitment to cut emissions, a company or sector should be guaranteed that it would not be bound by subsequent mandates for greenhouse gas controls over the same time period. A similar approach could encourage companies, particularly in the electric utility sector, to cut carbon emissions as they undertake air pollution reductions required by existing law––a more cost-effective way to achieve multiple environmental objectives.

While such efforts can help get the United States on track, the long-term emission reductions needed can be achieved only with a far more comprehensive—and binding—strategy. Alternative approaches should be closely studied, and the results publicly debated. But much of the analysis thus far suggests that a “cap-and-trade” system—which sets an overall cap on emissions and establishes a market in carbon credits—can provide the private sector the flexibility and incentive to achieve emission reductions at the least possible cost. As yet, no economic model can accurately account for factors such as the rate of technological change that are key to assessing the long-term costs and benefits of a serious climate strategy. However, the best analyses to date suggest that the costs are reasonable, particularly when weighed against the serious and significant costs of not acting.

Ideally, a domestic climate strategy, particularly one employing emissions trading, would be coordinated with those of other countries under the aegis of a binding global framework. And this brings us back to the question of a constructive, credible U.S. position in the international negotiations set to resume in July in Bonn.

In broad terms, an international climate agreement must meet three fundamental criteria if it is to be effective: It must be environmentally sound; it must be cost-effective; and it must be fair. To be environmentally sound, an agreement must ensure that emissions actually are reduced over time to levels that achieve safe, stable atmospheric concentrations of greenhouse gases. This, again, will require economically achievable binding targets. And any agreement should include a strong compliance mechanism to ensure that the targets are met.

To be cost-effective, an agreement must allow nations to meet their targets flexibly and at the least possible cost. International emissions trading and other market-based mechanisms can help direct capital toward least-cost reductions. Other flexible approaches—such as allowing credit for sequestration of carbon in trees and soils, and measuring all greenhouse gases, not just carbon dioxide—also can help achieve reductions where they are most cost-effective. While the Kyoto Protocol includes all these provisions, there is still no agreement on the rules for implementing them. Bad rules—for instance, an arbitrary cap on the portion of a nation’s target that could be met through emissions trading—could drive up cost, with no environmental benefit.

Fairness could prove the trickiest of the three criteria. An international agreement will not work unless, in time, it entails binding commitments by all major emitting countries. The Framework Convention, signed by Bush the elder and ratified by the U.S. Senate, rightly commits developed countries to taking the lead. And as a practical matter, developing countries will not (and as a matter of principle, they should not be asked to) make binding commitments until the developed countries demonstrate real progress in reducing their own emissions. Ultimately, the parties must decide when—and in what manner—developing countries will be required to act. But for the moment, the best that can be hoped for is some formal acknowledgement by all parties that those issues will be squarely faced by a date certain.

We stand at a critical juncture, and whether nations can agree on a common path forward depends heavily on decisions now being weighed at the White House. The United States bears a special responsibility here, because we account for roughly a quarter of global greenhouse gas emissions and also because our economy is the largest and most vibrant in the world. If the United State wishes to be a leader in this global effort—rather than sit on the sidelines as other nations push ahead with the Kyoto Protocol—it must come forward with a credible proposal that provides a basis for further negotiation. To be credible, though, the United States must demonstrate that it is prepared to back up commitments abroad with real action at home. This requires a comprehensive climate policy that moves us forward, in a coordinated fashion, on both the domestic and the international fronts. We must close the gap between what we promise and what we can deliver.

— by Eileen Claussen
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