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What role for carbon markets in the 2015 climate agreement?
The following was published in the February 2015 edition of Biores, a publication of the International Centre for Trade and Sustainable Development.
By Anthony Mansell
International Fellow, Center for Climate and Energy Solutions
Will the current UN climate talks do enough to create common standards for international emissions trading in the future or should interested parties look outside the multilateral process?
Around the world governments are increasingly pursuing market-based approaches to reduce their greenhouse gas (GHG) emissions. South Korea’s emissions trading scheme entered force at the start of this year and is currently the world’s second largest carbon market. Many other carbon pricing policies are either in force or in the planning stages, including in emerging markets such as Brazil, China, and Mexico as illustrated in Figure 1.
Parties to the UN Framework Convention on Climate Change (UNFCCC) are due to meet in Paris, France later this year to finalise a new global climate agreement to replace the current Kyoto Protocol and the Copenhagen Accords when these expire at the end of this decade. One important consideration is the degree to which the new agreement can help facilitate the growth and integration of carbon markets. This article examines the existing international emissions trading regime under the Kyoto Protocol; the status of market-related issues in the ongoing UN climate talks; and potential options to encourage market approaches and policy co-ordination outside the UNFCCC.
Figure 1: Emissions Trading Schemes World Map, July 2014
Source: Copyright 2012, International Carbon Action Partnership (ICAP)
The origin of market mechanisms: The Kyoto Protocol
The development of a market for carbon emissions was a significant component of the UNFCCC’s Kyoto Protocol, which is currently in its second commitment period, running from 2012 to 2020. Parties with emissions reduction targets – listed in Annex B of the Protocol – are allocated “assigned amount units” (AAUs) that represent the total emissions permitted to meet these targets. Domestic reduction policies help to bring actual emissions in line with the allocated AAUs. Parties then submit national greenhouse gas inventories annually to the UNFCCC that account for all emissions that occurred within that year.
To give countries greater flexibility to meet emissions targets, which in turn should help to reduce the overall costs of cutting emissions, three methods for transferring units – either emissions or emission reductions – between countries are sanctioned in the Kyoto Protocol. Article 17 provides for International Emissions Trading (IET), meaning that countries that have reduced emissions below their targets and therefore have excess units, can sell their excess allowances to countries whose emissions exceed their targets. Another transfer option is Joint Implementation (JI), which allows Annex B countries to earn emission reduction units (ERUs) through emission reduction or removal projects in other Annex B countries. The Clean Development Mechanism (CDM) allows Annex B countries to earn certified emission reduction (CERs) credits through emissions-reduction projects in developing countries. Finally countries can also earn removal units (RMUs) based on land use, land-use change, and forestry (LULUCF) activities.
Emissions’ trading under the Kyoto Protocol relies on international oversight. All transfers are tracked using a registry called the International Transaction Log (ITL). A common accounting standard applies to all countries with emission targets. An executive board must approve the methodology that CDM projects propose to use. Finally, under the Protocol only the international transfers it sanctions are considered legitimate to fulfil a country’s emissions-cutting obligations.
The Kyoto model provides important infrastructure for an international carbon market. Common accounting procedures ensure that any transfer meets the internationally agreed level of environmental integrity. An AAU allocated to Switzerland represents a tonne of emissions measured using the same standard as an AAU allocated to Norway. Common offset methodologies give a blueprint to replicate projects across the globe. The CDM has been able to issue 1.4 billion credits – each representing a tonne of avoided emissions – and mobilise over US$400 billion in investment using this common rulebook for managing offset projects. Moreover when countries submit their national greenhouse gas inventories, any recorded transfers can be verified by checking the international registry, reducing the potential for a double counting of emissions.
The Kyoto Protocol’s rigidity, however, has undermined broad participation. This goes beyond international trading. For example, there is little flexibility in the types of commitments that countries must meet, namely quantified economy-wide emission reduction targets. Furthermore, as the CDM illustrates, Kyoto uses a binary differentiation between developing countries – that host projects – and developed countries – that finance them. More fundamentally Kyoto establishes binding emissions targets for developed countries and no new commitments for developing countries. Many countries have said that such a bifurcated structure would not be politically acceptable in a future UNFCCC agreement. The post-2020 regime will likely need to reflect a less rigid form of international governance, including at the level of emissions-reduction tools, if it is to garner broad support.
Bringing markets into the new regime
The Paris climate deal is being negotiated under the UNFCCC’s Ad Hoc Working Group on the Durban Platform for Enhanced Action (ADP). Its mandate is to “develop a protocol, another legal instrument or an agreed outcome with legal force under the Convention applicable to all Parties, which is to be completed no later than 2015 in order for it to be adopted at the twenty-first session of the Conference of the Parties (COP) and for it to come into effect and be implemented from 2020.”
By the end of March, parties will begin submitting their intended nationally determined contributions (INDCs), which constitute what a country proposes to do to combat climate change after 2020. At COP20 held in Lima, Peru last December countries agreed to some broad definitions of areas and information to include in the INDCs. Some parties are likely to include the use of markets as part of their INDC as a way to achieve emissions-reductions.
The ADP’s mandate does not address carbon markets. Within the ADP negotiations so far questions relating to carbon markets have arisen primarily in the context of emissions accounting. Many parties believe that, in a regime lacking the top-down architecture of the Kyoto Protocol, minimising the potential for double counting is an imperative if markets are to play a positive role. Responsibility for avoiding double counting could rest on countries that choose to use markets with discretion as to how they do so. Alternatively a common accounting procedure could be agreed internationally to account for market transfers between countries.
Meanwhile, other issues related to the future role of carbon markets are being negotiated outside the ADP, within the UNFCCC’s Subsidiary Body for Scientific and Technological Advice (SBSTA). In this track, parties are seeking agreement on a Framework for Various Approaches (FVA), as a way of co-ordinating market and non-market based mitigation actions that relate to commitments under the Convention. Such a system could facilitate the transfer of units between different countries in the absence of a Kyoto-like architecture, and establish a New Market Mechanism (NMM), as well as Non-Market Approaches (NMA). However, parties have yet to agree on a definition of any of these three concepts, which prevents the discussions from moving forward. A number of countries have also expressed reservations about market mechanisms from an ideological point of view.
At the most recent Lima COP the FVA discussions hit deadlock after negotiators disagreed on whether these talks should continue in SBSTA or be transferred to the ADP. Some parties did not want to continue with the technical discussions since they believed it would pre-judge outcomes under the ADP and the inclusion, or not, of markets in the new climate agreement. The FVA discussions will continue at the June SBSTA session in Bonn, Germany, but prospects for agreement on these issues in Paris are not high.
For carbon markets to continue to grow post-2020 it would be important that the Paris agreement at the very least not disqualify international transfers as a way for parties to implement their nationally determined contributions. An affirmative recognition that parties may employ market mechanisms would provide a positive signal although some parties, including some favouring the use of market mechanisms, do not believe this would be legally required to move forward with market tools. The Paris agreement could consider establishing a process to agree common accounting standards, and other relevant measures, at a later stage. Any such agreement, however, would need to overcome the divergent views on the use of markets.
Looking beyond the UNFCCC
Other forms of policy co-ordination can play an important role in the absence of international consensus. Linking binds together different emissions trading schemes into a common market. In the context of the post-2020 regime, if there is agreement that transferring units to satisfy a country’s emissions-cutting obligations are legitimate – or at the very least do nothing to preclude it – such linkages could occur even in the absence of a specific, international framework such as the FVA.
Some governments have already gone down this route. The EU ETS and Australia’s carbon pricing mechanism entered linking negotiations before the Australian government repealed their policy last July. At the sub-national level, California and Québec held their first joint auction of carbon allowances this past January, completing the process of joining their cap-and-trade programmes together. California is also exploring the possibility of allowing forestry offsets from sub-national provinces in Brazil, Indonesia, and Mexico.
Creating these linked emissions-reduction markets offers several advantages for governments seeking to take action on climate change. A common carbon price between jurisdictions could alleviate some of the economic competitiveness concerns about uneven abatement costs faced by businesses, particularly when the link occurs between key trade partners. A linked market would, in theory, equalise the carbon price faced by firms in each jurisdiction. Some companies may be hesitant for their government to link to a market where the carbon price is higher because of concerns this will raise their individual compliance costs. Nevertheless, a broader pool of allowances and offsets would reduce the aggregate cost of reducing emissions across the entire market, by allowing firms with relatively high abatement costs to import allowances from firms located in another jurisdiction who face lower abatement costs.
A common carbon price between jurisdictions could alleviate some of the economic competitiveness concerns about uneven abatement costs faced by businesses, particularly when the link occurs between key trade partners.
Bilateral linking does require prior co-ordination. For example, the accounting standards used to measure emissions must be consistent, to ensure a tonne is a tonne across the common market. The use of market stabilisation measures, for example setting a minimum and maximum price within a carbon market, must be harmonised to prevent firms from exploiting arbitrage opportunities.
The EU and Australia, as parties to UNFCCC, had the benefit of being under the Kyoto architecture where many of these technical questions were already agreed internationally. California and Québec are both members of the Western Climate Initiative (WCI), established in 2007 to facilitate a regional carbon market between US states and Canadian provinces. Agreeing common approaches during the design phase of these market programmes has made bilateral connections easier to pull off.
The potential risk of these bilateral arrangements is if governments agree linkages without putting in place sufficiently stringent accounting or technical standards. In the absence of international guidance on the kinds of transfers that are acceptable, and a common accounting framework, the responsibility to ensure environmental integrity rests with the jurisdictions that link. Governments that link bilaterally or in a club would need to agree to stringent accounting rules, registry systems, among other aspects, and those wishing to join the scheme would need to meet these standards.
Moving forward with carbon trading
The most effective solution to co-ordinate market policies is a set of agreed international rules and mechanisms. The Kyoto architecture provides a common unit, common approaches, and common accounting that offer some certainty to carbon market investors. Ultimately, however, that system is tied to a view of differentiation and requires a level of international governance that does not engender broad participation.
A new UNFCCC regime could develop rules in line with these political realities. Whether this occurs under a FVA, or a new set of deliberations in the ADP, developing common multilateral standards for markets will require international consensus. However, anti-market sentiment could harm prospects for agreeing to meaningful, robust rules. In the meantime, there are approaches outside of the UNFCCC that can advance market linkage from the bottom-up, without waiting for top-down direction. So long as the new international climate regime does not prohibit the transfer of market units, interested governments could establish talks on common approaches, and lay the groundwork for bilateral or plurilateral linking. While this may not have the unifying effect of a global standard, or a common carbon price, it could allow those who wish to co-ordinate their market policies to do so unencumbered by the need for international consensus.
South Korea’s Emissions Trading System
On January 1, 2015, South Korea launched an emissions trading system that covers roughly two-thirds of the country’s emissions. Emissions trading is a key policy toward meeting South Korea’s target of reducing greenhouse gas emissions 30 percent below business as usual levels by 2020.
The South Korean carbon market is the world’s second largest, behind the European Union Emissions Trading Scheme (EU ETS). It is also the second nationwide emissions trading program in Asia, following the launch of Kazakhstan’s ETS in 2013.
Background and Details
The original legislation creating the Emissions Trading Scheme (ETS) was adopted almost unanimously on May 2, 2012. The program was originally scheduled to enter force on January 1, 2013, but the government delayed the start to give companies more time to prepare. Trading officially commenced on the Korea Exchange (KRX) on January 12, 2015.
The program is split into three phases: 2015-2017, 2018-2021, and 2022-2026. More than 500 companies are included in the program, from the power, steel, petrochemical, electronic, cement, automobile, buildings, and waste sectors. In addition, five airlines will participate to cover their domestic aviation emissions.
In the first phase, from 2015 to 2017, a total of 1.64 billion allowances will be allocated. The number of allowances individual companies will be allocated is based on their emissions between 2011 and 2013. There will also be additional allowances available for new or expanded facilities. At the beginning of the program, 100 percent of allowances are allocated to companies, but this will be reduced to 90 percent by 2021. The other allowances will be auctioned by the government. International offsets are currently not available to companies to meet their obligations.
The precursor to the ETS in Korea was the Target Management Scheme (TMS), a greenhouse gas management program with 470 participating companies. As with the ETS, individual companies were required to reduce their emissions to target levels. However, the TMS did not allow trading between companies, and the penalties for not complying are not as severe as under the ETS. Features of the TMS have been incorporated into the new system, such as the governance structure and the collection of greenhouse gas inventories.
Progress on a multifaceted global challenge like climate change doesn’t happen in one flash of bright light. This can lead to the impression that little is being accomplished, especially when stories highlight areas of disagreement.
Nothing can be further from the truth. In reality, progress is more like the brightening sky before dawn. We saw positive steps in 2014, and they’ll help lay the groundwork for significant climate action in 2015 in the United States and around the world.
In the U.S., we will see the EPA Clean Power Plan finalized and states taking up the challenge to develop innovative policies to reduce harmful carbon dioxide emissions from power plants. Allowing governors to do what they do best, innovating at the state level, will be a key achievement of 2015.
Internationally, more countries than ever before will be putting forward new targets for reducing greenhouse gas emissions ahead of talks in December in Paris to hammer out a climate pact to replace the Kyoto Protocol.
In the New Year, we will be building on solid progress made in 2014 by governments, businesses, and individuals. Here are 10 examples:
Image courtesy UNFCCC, Flickr. Trimmed to fit this space.
OUTCOMES OF THE U.N. CLIMATE CHANGE CONFERENCE IN LIMA
20th Session of the Conference of the Parties to the United Nations Framework Convention on Climate Change (COP 20)
December 1-12, 2014
In a preview of a tough year ahead, governments meeting at the U.N. Climate Change Conference in Lima, Peru, went 30 hours over deadline to hammer out a modest set of procedural steps, and made no real progress on the larger issues looming as they work toward a new global climate agreement next year in Paris.
In adopting the Lima Call for Climate Action, parties to the U.N. Framework Convention on Climate Change (UNFCCC) agreed on loose arrangements for bringing forward their “intended nationally determined contributions” to the Paris agreement. They also forwarded the “elements for a draft negotiating text” that is to be produced by May. But the “elements” paper – a compendium of all the issues and options put forward by parties – explicitly disclaims any “convergence” and leaves the door open to further proposals next year.
The meeting – known formally as the 20th Session of the Conference of the Parties to the UNFCCC, or COP 20 – completed the third of a four-year round of negotiations to conclude in Paris. It began with a sense of momentum, following nearly $10 billion in pledges to the new Green Climate Fund and the joint announcement by the United States and China of their post-2020 emission targets. However, the meeting quickly bogged down, and parties put aside the “elements” document to haggle over the more immediate issues of how their intended contributions to the Paris agreement are to be submitted to and weighed by the UNFCCC.
Though these matters were largely procedural, the fight over them brought to the fore the perennial and increasingly contentious issue of differentiation among developed and developing countries. Many developing countries insisted on maintaining the stark differentiation of the past, but developed countries refused. In the end, the Lima decision largely sidestepped the issue, which is certain to be a central challenge in reaching an agreement in Paris.
In other areas, parties conducted a “multilateral assessment” of emission-cutting efforts by developed countries; debated how to continue scaling up finance to developing countries; failed again to make progress on new market-based approaches; and continued to struggle over aid to developing countries for “loss and damage” resulting from climate change.
Following is a summary of key outcomes:
Ad Hoc Working Group on the Durban Platform
In 2011, COP 17 established the Ad Hoc Working Group on the Durban Platform for Enhanced Action (ADP), with the mandate of negotiating by COP 21 a post-2020 agreement in the form of “a protocol, another legal instrument or an agreed outcome with legal force under Convention applicable to all Parties.”
A decision last year, at COP 19 in Warsaw, invited parties to submit their “intended nationally determined contributions” (INDCs) to the new agreement “well in advance” of the Paris conference (“by the first quarter of 2015 by those Parties ready to do so”) in a manner that “facilitates the clarity, transparency, and understanding” of the intended contributions. Parties deferred to Lima the question of what information they will provide when putting forward their contributions.
The Warsaw decision appeared to suggest the very broad contours of the Paris agreement – a hybrid structure combining bottom-up and top-down elements. While parties’ individual contributions would be nationally determined, they would be accompanied by a “rules-based regime” to, for instance, promote transparency and accountability.
In Lima, the ADP had two documents before it: a paper identifying potential “elements for a draft negotiating text” of the Paris agreement, and a decision laying out the process for presenting and considering parties’ INDCs over the coming year.
The “elements” paper essentially contains the raw materials for the Paris agreement, covering such issues as mitigation, adaptation, finance, technology transfer, transparency, the legal nature of parties’ commitments, the use of market mechanisms, and procedures to periodically update commitments. It grew to 39 pages as parties made sure all of their proposals were reflected.
The major issue on the “elements” paper was its status heading into next year. Many parties did not want it to be the exclusive basis for developing the draft negotiating text (which, under the rules of the Convention, would need to be circulated by May in order for the Paris agreement to be adopted as a protocol). As a result, the paper includes a footnote stating that the elements “reflect work in progress,” and that they “neither indicate convergence…[nor] preclude new proposals from emerging” next year.
Far more contentious was the decision on steps leading to Paris. Major issues, many of which remained in play until the final 1 a.m. deal, included:
Scope of INDCs – Developed countries wanted “nationally determined commitments” to focus only on mitigation, while many developing countries pushed to include adaptation and finance too. The compromise does not explicitly define the scope of INDCs. In linking INDCs to the Convention’s ultimate objective (stabilizing greenhouse gas concentrations to avoid dangerous anthropogenic interference with the climate system), the decision sets an expectation of mitigation contributions from all. It also invites parties to “consider including an adaptation component” as well.
Upfront information – To help clarify and assess parties’ contributions, the decision identifies certain information that parties might provide, as appropriate, including “quantifiable information” on an INDC’s timeframe, scope and coverage, and the assumptions and methodologies used in estimating and accounting for emissions. It also asks parties to say how their contributions are “fair and ambitious.” However, language saying that “all Parties shall” provide upfront information was replaced by “may” in the final text, making it voluntary.
Ex ante consideration – Many parties pushed for different types of processes to scrutinize one another’s intended contributions pre-Paris; major developing countries tried to block them. The final decision dropped a mid-year “dialogue” on the INDCs, but added direction to the UNFCCC secretariat to prepare a synthesis report by November on the “aggregate effect” of the INDCs – in other words, how they compare to the reductions needed to limit warming to 2°C.
Differentiation – Major developing countries pushed for explicit differentiation between Annex I (developed) and non-Annex I (developing) countries throughout the decision, which developed countries flatly rejected. The compromise echoes language from the recent US-China joint announcement, simply restating the UNFCCC principle of “common but differentiated responsibilities and respective capabilities,” with a slight addition: “in light of different national circumstances.”
Finance – Differentiation was also an issue in the decision’s call for increased finance for developing countries. Rather than assuming the entire onus themselves, developed countries pushed for language saying that other parties “in a position to do so” should also contribute. The final text simply “recognizes complementary support” from other parties.
Loss and damage – COP 19 launched a separate process to consider steps to help especially vulnerable developing countries cope with “loss and damage” – climate impacts that cannot be avoided even with strong mitigation and adaptation efforts. In Lima, those countries tried but failed to add loss and damage to the list of issues the Paris agreement must address. The final decision merely notes the separate process already underway. On the decision’s adoption, Tuvalu, speaking for the least developed countries group, noted for the record its interpretation that this reference indicates an intention by parties to address the issue in the Paris agreement. (See more on loss and damage below.)
COP 20 featured the first-ever “multilateral assessment” of mitigation efforts by developed countries, part of a new set of transparency procedures established under the 2010 Cancún Agreements. Seventeen developed country parties, including the United States, the European Union, several EU member states, and New Zealand, provided brief presentations to the Subsidiary Body on Implementation (SBI) on progress toward achieving their 2020 emission pledges, and fielded questions from other parties.
The SBI session was one in a sequence of steps in the new international assessment and review (IAR) process for developed countries. The parties being assessed had earlier submitted biennial reports on their implementation efforts, which had undergone expert review, and participated in online Q&A with other parties. The process results in a party “record” including any expert review reports, a compilation of the online and in-session Q&A, a summary report from the SBI, and any additional comments from the party concerned.
Other developed countries will be assessed over the coming year. Under a parallel process called international consultations and analysis (ICA), developing countries are now submitting their biennial reports, which will undergo technical analysis next year, followed by a “facilitative sharing of views” among parties in 2016.
Apart from figuring in the ADP debate, climate finance issues were addressed on several other fronts at COP 20.
Leading up to Lima, pledges toward the initial capitalization of the Green Climate Fund (GCF) established under the Cancún Agreements had approached the informal goal of $10 billion. Additional pledges during the conference surpassed that goal, including pledges by Australia, which had earlier said it would not contribute, and by three developing countries: Colombia, Mexico and Peru.
Meanwhile, China, saying that the GCF should be funded by developed countries, announced the launch of a separate South-South fund. China pledged to double the $44 million in climate finance it has provided since 2011, and invited other developing countries to contribute. It provided few details on how the new fund will be managed.
The COP received the first biennial assessment of its Standing Committee on Finance, which estimated that flows from developed to developing countries totaled between $40 billion and $175 billion a year between 2010 and 2012, including $35 billion to $50 billion a year in public finance. (Developed countries committed in Cancún to mobilize $100 billion a year in public and private finance by 2020.) The wide range in the committee’s estimate of total flows reflects both the lack of an agreed definition of climate finance and the difficulty in tracking, in particular, private flows.
In a debate over scaling up climate finance, developed countries resisted calls by developing countries for interim targets toward the $100 billion a year to be mobilized by 2020. The COP instead urged developed countries to “enhance the available quantitative and qualitative elements of a pathway, placing greater emphasis on transparency and predictability of financial flows.”
Framework for Various Approaches/New Market Mechanism
Since COP 18 in Doha, efforts toward establishing a new market mechanism under the UNFCCC have been subsumed under a broader work program on a Framework for Various Approaches, which also takes in non-market approaches.
For the second year in a row, the discussions remained bogged down in the Subsidiary Body on Scientific and Technological Advice (SBSTA) and never reached the COP. China and Brazil argued that the issues should instead be taken up under the ADP, but other parties objected. The issues will be before SBSTA again next year.
Loss and Damage
At COP 19, parties established the Warsaw International Mechanism for Loss and Damage to consider steps to address loss and damage suffered by especially vulnerable countries, and agreed to revisit the mechanism and its structure at COP 22, a year after the Paris conference.
In Lima, the COP decided on the composition of the mechanism’s executive committee and adopted an initial two-year work plan outlining a detailed set of activities to better understand unavoidable climate impacts and to identify and promote risk management strategies and other responses.
The ADP will hold its next session February 8-13, 2015, and will meet again during the annual meetings of the UNFCCC Subsidiary Bodies set for June 3-14, 2015, in Bonn.
COP 21 will be held from November 30 to December 11, 2015, in Paris. The COP is considering an offer by Morocco to host COP 22 on November 7-18, 2016, with a final decision due at COP 21.
It was clear heading into the U.N. climate change conference in Lima that countries would punt all the toughest issues until next year in Paris, when a grand new global deal is due. All they really needed in Lima were a few procedural decisions setting the stage.
So why did it take more than 30 hours beyond the conference deadline to deliver something so modest?
The answer is that even a seemingly trivial procedural issue can be freighted with substantive implications, so countries fret over every nuance, lest they let something slip that will come back to haunt them later. In Lima, like so many times before, their biggest worry was how responsibility will be distributed across developed and developing countries.
At the start of the global climate effort, developed countries were comfortable with a stark division assigning most of the responsibility to them. But 20 years later, China is now the world’s largest carbon emitter, and developed countries no longer accept the so-called firewall between the two groupings.
The 2011 Durban Platform for Enhanced Action, which launched the current round of negotiations, said the Paris agreement would be “applicable to all.” But just what that means was left to be sorted out later, and will likely be the central challenge in Paris.
The handwriting is on the famous firewall – it’s coming down. China’s willingness to stand side by side with the United States last month to jointly announce their post-2020 emissions goals is a tacit acknowledgement of that. The question is what if anything takes its place.
Image courtesy UNFCCC, Flickr. Trimmed to fit this space.
In a preview of a tough year ahead, governments meeting at the U.N. Climate Change Conference in Lima, Peru, went 30 hours over deadline to hammer out a modest set of procedural steps, and made no real progress on the larger issues looming as they work toward a new global climate agreement next year in Paris.
The Lima Call for Climate Action
Events in Lima
- December 5
"Addressing Corporate Climate Risk & Resilience" - Preliminary findings of a new analysis of how major companies are assessing and addressing climate risks and increasing their climate resilience. Watch video.
- December 8
C2ES Media Briefing in Lima - Elliot Diringer presents an update on the Report of the Co-Chairs of "Toward 2015: an International Climate Dialogue." Watch video.
- Summary of all C2ES events in Lima
New Insights on Weathering the Storm: Building Business Resilience to Climate Change
Date: Friday, December 5, 2014 18:00-19:00
Location: US Center
See video of the event.
C2ES will present preliminary findings of a new analysis of how major companies are assessing and addressing climate risks and increasing their climate resilience. This research builds on C2ES’s 2013 report, Weathering the Storm: Building Business Resilience to Climate Change, which found that 90 percent of S&P Global 100 companies see extreme weather and other climate risks as current or future business risks, while 62 percent say they are experiencing climate change impacts now, or expect to in the coming decade. The new analysis looks more closely at emerging on-the-ground practices among companies to manage their climate risks. A presentation of C2ES’s findings will be followed by a panel discussion.
- Giles Dickson, Vice President, Environmental Policies & Global Advocacy, Alstom
- David Hone, Group Climate Change Advisor, Shell
- Jeanette Pablo, Federal Affairs & Climate Advisor, PNM Resources
- Timothy Juliani, Director of Corporate Engagement, C2ES
An Update and Perspectives on U.S. Climate Change Policy
Date: Monday, December 8, 2014 15:30
Location: EU Pavilion
This event will provide an update from multiple perspectives on the state of climate policy in the United States, including implementation of President Obama’s Climate Action Plan, action at the state level, and business and NGO perspectives.
- Mike Boots, Acting Chair, White House Council on Environmental Quality
- Matt Rodriguez, Secretary of Environmental Protection, California
- Marnie Funk, Director, CO2 Advocacy, Shell
- Brian Wolff, Executive Vice President for Public Policy, Edison Electric Institute (EEI)
- Elliot Diringer, Executive Vice President, C2ES
Joint Reception with EEI and IETA
Date: Monday, December 8, 2014 19:00
Location: US Center
C2ES Media Briefing in Lima
Date: Tuesday, Dec. 9, 13:00
Location: Press Conference Room 2, on Level 1 above the media center at the conference venue, Cuartel General del Ejercito del Perú.
Webcast: Details will be posted at http://unfccc6.meta-fusion.com/cop20/
Negotiators heading to Lima for the annual U.N. climate summit face a certain paradox. There are encouraging signs of growing momentum toward a new global climate deal late next year in Paris. Yet over the next two weeks in Lima, the negotiators may make only modest progress at best.
There are good reasons to be hopeful.
First, recent events and announcements have strengthened confidence in prospects for Paris. These include the U.N. leaders summit in New York, nearly $10 billion in pledges to the new Green Climate Fund, Europe’s decision on a 2030 emissions goal, and the joint announcement by the U.S. and China of their post-2020 targets.
Second, the negotiations throughout this year have been notably civil and substantive. Wide gulfs remain, but rather than succumbing to procedural fights, parties have been putting forward and constructively debating concrete ideas for the Paris agreement.
Third, behind the scenes, there is a fair degree of convergence among key countries on the broad outlines of a Paris deal. This is reflected in a recent report from the co-chairs of Toward 2015, an informal dialogue among officials from 20+ key countries organized by C2ES.
The climate targets announced this month by the United States and China will require a significant effort beyond a business-as-usual scenario for both countries. More details will likely follow in the weeks and months ahead, but here is what we know so far for each country.
China announced a goal for its greenhouse gas emissions to peak by 2030 or sooner. This marks the first time that China has pledged a peak or absolute target for greenhouse gas emissions, rather than an intensity-based target. In business-as-usual scenarios, China’s emissions wouldn’t peak until 2040 or later.
China also announced it would boost its share of zero-carbon energy, which includes nuclear, hydropower and renewables, to 20 percent – up from about 13 percent today. Meeting that goal will require a substantial build-out of nuclear power stations, hydroelectric stations, wind turbines, and solar panels, as well as transmission and other infrastructure. In a separate announcement, China said it plans to cap its coal consumption by the year 2020.
China can’t, as critics claim, sit idly by for 15 years and reach these targets. It will need to significantly restructure its energy system. China will have to add more than 1 GW of zero-carbon power a week for the next 15 years – an amount roughly equal to the entire installed electricity capacity of the United States.
Statement from Bob Perciasepe
President, Center for Climate and Energy Solutions
On the U.S.-China Joint Announcement on Climate Change
November 11, 2014
The joint announcement by President Obama and President Xi is an extremely hopeful sign. Even if the targets aren’t as ambitious as many might hope, the world’s two largest carbon emitters are stepping up together with serious commitments. This will help get other countries on board and greatly improves the odds for a solid global deal next year in Paris.
These targets will require major undertakings by both countries. Clearly the leaders of the world’s two largest economies have decided the risks posed by climate change justify stronger action to cut carbon emissions. And they’re confident they can keep growing their economies at the same time.
In the case of the United States, the new target is pushing the limits of what can be done under existing law. We can get there if Congress doesn’t stand in the way, and if states roll up their sleeves and work with businesses and other stakeholders to craft smart, practical plans to cut emissions from power plants. But to go much further, we’ll ultimately need Congress to act.
For too long it’s been too easy for both the U.S. and China to hide behind one another. People on both sides pointed to weak action abroad to delay action at home. This announcement hopefully puts those excuses behind us. We’ll only avert the worst risks of climate change by acting together.
Contact: Laura Rehrmann, email@example.com or 703-516-0621
About C2ES: The Center for Climate and Energy Solutions (C2ES) is an independent, nonprofit, nonpartisan organization promoting strong policy and action to address the twin challenges of energy and climate change. Launched in 2011, C2ES is the successor to the Pew Center on Global Climate Change. Learn more at www.c2es.org.