Small Islands, Big Ideas: Climate Change and Environmental Responsiblity
From November 11th to 22nd, the United Nation Framework Convention on Climate Change (UNFCCC) took place in Warsaw. Over a period of 10 days, 195 nation states participated in the discussion of our next steps in the face of climate change. The next session is to be held in Paris in 2015.
2013 has seen a variety of extreme weather events that has affected every continent, and left millions devastated. This year’s UNFCCC began just as the world’s latest natural disaster, typhoon Haiyan, classified as a ‘super typhoon’, and perhaps the strongest typhoon ever recorded, finally dissipated (Strzempko, 2013). With estimated Haiyan damages of up to $14.5 billion for the Philippines to clean up, the international community is reminded once more that those who are most vulnerable to climate change, are often those least able handle the economic burden that comes with it (Air Worldwide, 2013). Furthermore, in many cases these countries, which have less developed economies, are suffering an environmental onslaught, caused primarily by the impacts of past actions and decisions of ‘developed’ economies, which they are simply not able to afford.
The question that is raised, is one of economic and environmental responsibility; if such countries cannot front the financial load – who can? And, more importantly, who should?
In the previous convention in Doha, the need to “establish an institutional arrangement…to address loss and damage in countries particularly vulnerable to adverse effects of climate change” was recognised. Regrettably, up to now we have had a history of inaction on environmental issues, even when urgency is universally accepted on an international level (IISD Reporting Services, 2013).
This year in Warsaw, the Alliance for Small Island States (AOSIS) raised this issue again, calling for a Multi-Window Mechanism to Address Loss and Damage from Climate Change Impacts, which includes a “compensatory component”, bringing to the foreground the notion of environmental accountability. The proposal requests support, by the way of finance, technology and capacity building, from ‘developed’ countries. The funds are to be accumulated, taking into consideration each countries responsibility (GHG emissions) as well as capacity (GDP). Through this proposal, AOSIS has brought placed an emphasis on the global nature of environmental responsibility, and effects, and demands that this be recognised through economic means, namely through their Multi-Window Mechanism.
While the environment can be considered innately global in nature, as a race, we have striven towards the globalisation of our economic system, thus deepening these global connections. The current financial crisis, which has reverberated across the globe, demonstrates that we have succeeded, and now more than ever the actions of one, affect all, regardless of economic or political power relations. However, our interconnectedness is also one of our greatest strengths. The ability to share information and technology, as well as organise rapid mobilisation in times of disaster are part and parcel with our increasingly globalised world.
The message of AOSIS is clear: “We didn’t make this mess, and we cannot clean it up alone”. With these tools at our disposal, how will we respond?
Sources:
http://unfccc.int/files/kyoto_protocol/application/pdf/aosisinsurance061208.pdf
http://www.theguardian.com/world/natural-disasters?page=1
http://www.wwlp.com/weather/us-wx-news/the-strength-of-super-typhoon-haiyan
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11 Dec 2013
por
asyamarhubi
IMSD /
The CDM Clean Development Mechanism: is it effective?
Last November the UNFCCC (United Nations Framework Convention on Climate Change) held in Warsaw its 19th Climate Change Conference to discuss the actions in order to answer to the pressing climate change issues and look for the needed agreements.
Since it went into force in 1994, the UNFCCC as an international treaty counting 195 parties tried to set out a series of mechanisms with the goal to stabilize atmospheric concentrations of greenhouse gases (GHGs) to avoid “dangerous anthropogenic interference with the climate system”.
The main operational arm of the UNFCCC is represented by The Kyoto Protocol. Adopted in 1997, it went into force in 2005 setting emission reduction targets for the (limited number of…) developed countries who ratified the treaty. The target was to reduce emissions of six greenhouse gases (GHGs) by an average 5% (compared to levels of year 1990) in the first commitment period (2008-2012).
Once these targets have been established, the emission reductions basically acquired an economic value. There are two types of carbon market systems and three mechanisms used to facilitate emission reductions and stimulate green investments:
- cap and trade system, with the emissions trading: an emission cap is set, and countries or companies from developed countries get corresponding tradable emission allowances (called Assigned Amount Units, AAUs). The largest scheme is the European Union Emissions Trading System EU ETS.
- offsetting systems, with two project based mechanisms: offset tradable credits are issued for those projects that “produce” emission reductions (measured against a theoretical emission baseline). The two mechanisms are the JI Joint Implementation and the CDM Clean Development Mechanism, with the difference being the countries where the project is undertaken (in projects in industrialized countries for the JI, in developing countries for the CDM)
Of all the topics discussed at the Warsaw Climate Conference, in this post I’d like to focus on the CDM. I find it related to the IMSD Master because of its trigger on sustainability. Conceived as a win-win solution, the CDM has two goals:
- to deliver results within the Kyoto Protocol (helping developed countries to reduce their emissions). Implementing a CDM project creates certified emission reductions (CERs) that can be bought by developed countries in order to meet the emission cap of the Kyoto Protocol instead that reducing their own emissions.
- to enable countries not included in Annex I (also referred to as developing countries) to achieve sustainable development. A CDM project can bring benefits to the developing country where the project is implemented in terms of investments, knowledge transfer (green energy related) and – as already underlined – sustainable development.
The Warsaw Climate Change Conference expressed the “concern regarding the difficult market situation currently faced by CDM participants and the consequent loss of institutional capacity threatening the value of the CDM”. And the African Group “called on the developed countries, expressing disappointment with lack of progress and failure to improve the CDM”. What happened, has the CDM not been able to deliver its promises?
As for the sustainable development objective, the UNFCCC tries to assess it based on the three dimensions set by the Rio+20 Conference – social, environmental and economic – through DNA, Designated National Authorities. The main “claimed” benefit of the CDM projects is the creation of employment.
But in reality there is little evidence of clear sustainable benefits. Some of the reasons are: the developing countries hosting the CDM projects set their own sustainable criteria but their interest is to attract investments not to set too high criteria to scare money off. That’s why they reject international sustainability assessments. Also, the DNA authorities provide little or no control and follow up. Sadly, as reported by Carbon Market Watch, “sustainability benefits have no financial value in the current system, as only greenhouse gas benefits result in monetary compensation (through the generation of credits)”.
As for their capacity to ensure the inclusion of developing countries in the carbon markets (through CDM projects), there have been quite a few issues for instance related to identifying the right baseline (measure of the CERs) which was often not realistic or inflated to get more credits. Moreover, the difficult market situation and the lack of demand for CERs from the developing countries have undermined the institutional capacity of the mechanism.
The point is that the mentioned market mechanisms are cost-effective based: in order to respect the emission targets the countries / companies can decide whether it is more convenient for them to implement direct measures or else whether to buy emission allowances on the available markets.
Yet, one of the problems is that the emission cap has been set too “friendly”, assigning too large allowances: it is easy to respect the cap which is not even reflecting the actual environmental needs. Coupling this with the recent global crisis and the consequent decrease of the industrial activities, it’s possible to explain the excess of “credits” in the market and the lack of demand for CDM projects. Companies and developed countries now do not need to offset their emissions and therefore have no interest in investing in green energy projects in developing countries.
There are many more issues related to the weaknesses of the overarching structure of the Kyoto Protocol (developing countries not bound to cap, major players who have not ratified the Protocol, lack of enforcement mechanism and no sanctions) but the climate change is calling for action. That’s why there is a “growing number of initiatives, policies and programmes outside the UNFCCC actively addressing climate change” (as noted by IISD).
Looking ahead, the energy demand will increase. When looking at the estimates of the International Energy Agency in its World Energy Outlook 2013: “global energy demand increases by one-third from 2011 to 2035”. And the share of fossil fuels in the world’s energy mix will still be 76% in 2035.
Global warming should be addressed with a global policy and with the involvement of all the countries. The urgency has been dreadfully remarked just before the beginning of the Climate Change Conference by the devastating effects of Typhoon Haiyan in the Philippines, one of the most powerful storms ever, that had destructive consequences in terms of human lifes (more than 5000 deaths), property and environment.
Existing measures have not been able to tackle globally the emission levels: from 1990 to 2011 if
looking at Kyoto Parties with targets, the MtCO2 has decreased by -12.1% from 8,778 to 7,713 but other countries levels have increased by +94.2% from 11,591 to 22,515. If adding the increases of international marine and aviation bunkers the total increase from 1990 to 2011 is +49.3% from 20.988 to 31.342 MtCO2. These data are taken from the IEA/OECD 2013 whose comment is that “the existing climate targets are not sufficiently comprehensive to lead to reductions in global CO2 emissions from fuel combustion”.
Here comes the Environmental Economics: maybe lowering the cap and actually setting monetary sanctions for no compliance could have an effective impact on the current scheme. As well as implementing the European 20-20-20 proposals that provides the review of the European Union Emissions Trading Scheme: to include aviation emissions into the scheme and auctioning the allowances (instead of assigning them for free).
Not mentioning the costs for the world. A driver for more powerful and binding actions should be the consideration that is cheaper to prevent environmental damages, tackling emissions for instance, than to wait and deal with the impacts: it would require an investment of about 1% of the global GDP against 5-20% of it to deal with the impacts on resources, health and on the environment (Stern Review on the Economics of Climate Change, 2006).
And, with an eye to sustainability, more efficient prevention measures could free up resources for other development goals.
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11 Dec 2013
por
guidopreti
IMSD /
Warsaw Climate Change Conference 2013
The 11 of November, Climate Change Conference began with a real impact on the members,Typhoon Haiyan had devastated the Philippines.
Since 1995, the UN gathers together to try and solve climate change problems, which are no longer a secondary issue. The big deal around climate change, right now, is the possibility of reaching 2C0 more on global temperature, which could cause such big problems in the climate that there are high possibilities of being unable to turn back, and try and amend the situation.
COP19 has given poor solutions for the next coming period. Despite the poor result, there were two issues of great interest undertaken during this conference: funds for loss and damages on vulnerable countries and the progress in The Durban Platform.
Countries like the US were reluctant to the approval of the loss and damage mechanism, because of the possible claims of developing countries. They proposed to include them under the existing climate adaptation measures of the UN, although vulnerable nations argued that some of their climate impacts cannot be situated under this wing. Finally the “Warsaw International mechanism” was created under the UNFCCC but with no clear mechanism on how it will be funded.
On the other hand, the Durban Platform, which tried to set the path for the creation of a new Kyoto Protocol in Paris 2015, was concentrated in the process of meeting deadlines. Being the Ad Hoc Working Group of the Durban Platform (ADP) the responsible for its development. This program will be applicable to both developed and developing countries, although they will have different levels of commitment. Hence being a controversial issue.
Parties asked for a flexible and adjustable agreement for every country, trying to keep building over the Kyoto Protocol. There was a request on part of the countries to prepare national contributions information for April 2015 and on those more developed (that are able to anticipate) for early 2014. Finally, this agreement was diluted within the talking’s around “commitment” towards “contribution” because of a last minute petition from India.
The future?
Until now the Warsaw International mechanism have only been words, there has not been any real commitment. Deliberations in Peru 2014 around the funding will be crucial.
On the Durban Platform decision should be made as quick as possible. Paris 2015 is just around the corner; we have 2 years from now to break barriers between the developed and developing world and move towards a common ground in Climate Change. If not the big target of not increasing the earth´s temperature in 2 C0 will be difficult to be met…making ourselves question such as: Will we have a future?
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11 Dec 2013
por
mariagutierrez
IMSD /
Warsaw Climate Change Conference: Incorporating Loss and Damage into the Agenda
The 19th Session of the Conference of the Parties to the UNFCCC took place last month in Warsaw. The United Nations Framework Convention on Climate Change (UNFCCC) is an international environmental treaty that was signed at the United Nations Conference on Environment and Development in Rio de Janeiro in 1992. One of the decisions settled in Warsaw was the development of a new mechanism to deal with “loss and damage”. “Loss and damage” alludes to repairable damage or permanent loss caused by the impacts of climate change; such as changing landscapes, rising seas, economic losses, stronger storms or floods.
This new mechanism can be understood as an admission by developed countries that climate change impacts are unstoppable. Especially after the Typhoon Haiyan, which occurred in the Philippines some days before the UNFCCC Convention started. Naderev “Yeb” Sano, the Philippines negotiator, made a great impact on the different parties with his speech during the Conference. Moreover, he was on a hunger strike until the conference made important progress on the issue.
Mohamed Adow, an observer from Christian Aid, said: “In agreeing to establish a loss and damage mechanism, countries have accepted the reality that the world is already dealing with the extensive damage caused by climate impacts, and requires a formal process to assess and deal with it, but they seem unwilling to take concrete actions to reduce the severity of these impacts.”
An important aspect of the debate was the fact that “loss and damage” may constitute a third pillar for the UNFCCC structure. The UNFCCC is currently structured in two pillars. The first pillar is mitigation, based on cutting emissions and issue targets. On the other hand, the second pillar is adaptation, which is aimed at preparing for climate change impacts. During last years’ climate meeting in Doha, a number of parties called for a compensation mechanism in terms of “loss and damage”. The United States were against compensation mechanism, and the European Union was in favor of “loss and damage” under the context of mitigation and adaptation. Nevertheless, during the Warsaw edition, the EU has not stated “loss and damage” under adaptation and mitigation. However, other countries like China have called for “loss and damage” as a third pillar.
As a result of the discussion, it was decided to establish a mechanism to support most vulnerable countries with greater protection against loss and damage. Besides, parties have started to develop the “Warsaw international mechanism for loss and damage”, which will begin next year. This new climate agreement will appear at the next UN Climate Change Conference in Peru, and a final commitment may be made in Paris in 2015.
Therefore, environmental protection should not only consist of mitigation as cutting emissions, valuation of harmful actions or behaviors or using economic instruments like taxes. Supporting the countries suffering climate change impacts is crucial to fight it. This way, developed countries should compensate developing countries for the disasters that they have speeded up. Nevertheless, we should take into account that these international declarations do not establish a real framework of rights and obligations.
References:
http://www.unep.org/newscentre/default.aspx?DocumentID=2755&ArticleID=9711
http://unfccc.int/files/meetings/warsaw_nov_2013/in-session/application/pdf/fccc.cp.2013.l.15.pdf
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11 Dec 2013
por
martagomezmanchon
IMSD /
No Change on Climate Change
Typhoon Haiyan that battered the Philippines in November 2013 provided the United Nations Framework Convention for Climate Change (UNFCCC) in Warsaw with a suitably sober context upon which to build discussions. While the effects of Haiyan are still being assessed, the typhoon left thousands dead. It has been reported that the lives of over 11 million people were affected by Haiyan, causing some 673 000 people to become displaced. Links have already been made to the effects of climate change on the severity of the storm. By 2100, average global temperatures are expected to have increased by at least 4 degrees; many have predicted that in the future extreme weather events will increase both in frequency as well as intensity. In the context of the Philippines and other countries whose existing resources are not able to cope with environmental disasters, dealing with the massive social and economic effects of this is possibly one of greatest challenges they will face in the decades to come.
A study undertaken by the World Bank – Economics of Adaptation to Climate Change (EACC) in 2009 estimated that the price for developing countries to adapt to climate change will be between 75-100 billion USD per year between 2010 and 2050 which equates to 0.2% of the GDP of all developing countries. Case studies were presented in seven different countries, all of whom could be considered vulnerable to extreme weather events. The study found that economic capabilities were of great importance to the reaction to natural disasters stating that the alleviation of poverty was the single most important factor. It also highlighted adaption strategies that could be adopted by poorer regions, however stated that these should be undertaken carefully prioritising initial “low-regret” options over larger scale investment which, according to many calculations, unless correctly planned and suitably allocated would not provide adequate protection.
The findings of this report are closely related to one of the outcomes of the latest UNFCCC conference. It was decided in Warsaw that a “loss-damage” mechanism would be drafted. The original aim of this was to form a new branch alongside mitigation (such as to set targets to cut emissions) and adaptation (advanced preparations for climate change). The loss-damage mechanism would aim to provide extra funding to bear the costs of countries that struggle to cope with the costs of extreme weather phenomena resulting from climate change. This also acts as an admission that human action is very likely has a direct influence on climate change. The mechanism was agreed upon during the last day of the conference with talks extending until late in the evening. However, there was disagreement over awarding the mechanism the status of a separate branch. Negotiators finally agreed on the content of the mechanism however it was decided that this would fall under the umbrella of “adaptation”.
This fell short of expectations of developing countries and environmental campaigners alike:
Click here to view the embedded video.
Developed countries, particularly the USA, argued that a loss-damage mechanism belonged under the mandate of adaptation. They claimed that adaptation measures are essential in order to prevent wide-scale loss and damage. Critics on the other hand pointed towards a market-failure: developed countries are failing to admit responsibility for their negative externalities and by doing so have ensured that the notions of compensation and culpability have been discarded.
Naturally, developed countries are the largest emitters of greenhouse gas emissions. Low lying islands and countries in the developing world consider themselves to be disproportionately affected by climate change due to the threat of rising sea levels. Many have been campaigning for years for an introduction of a loss-damage mechanism and argue that when people’s livelihoods stand in balance or they have to leave their homeland unwillingly then this cannot be classified as adaptation. It is feared that by doing so, focus will be disproportionately placed on preventative measures and not on mobilisation of resources to crisis areas. As the effects of climate change are already clear, many argue that an independent loss-damage mechanism is crucial in order to ensure an efficient and adequate provision of funding.
The Warsaw conference once again showed that there are clear tensions between developed and developing nations. Countries such as Japan and Australia, who revised their emissions targets, were harshly criticised. In the wake of the destruction of Haiyan, forecasters warn that the Philippines will experience an increase in the number of fierce typhoons. On average 22 typhoons affect the country per year, this year Haiyan was the 24th. With damages also increasing year on year (average 220 million USD / storm), the development of a loss and damage strategy and application of this seems to be more important than ever.
References:
http://www.worldbank.org/en/news/feature/2011/06/06/economics-adaptation-climate-change
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11 Dec 2013
por
davidthorpe
IMSD /
COP19 – Advancing Adaptation
The COP (Conference of the Parties) annual meeting held in Warsaw this year, deemed COP19, had a number of items on the agenda pertaining to combating environmental degradation. One of the agenda items that is fairly new under the United Nations Framework Convention on Climate Change (UNFCCC) is adaptation, which saw some initiatives for advancement in Warsaw. COP19 expanded on adaptation by conducting workshops to showcase achievements already seen as well as negotiating a new loss and damage provision. National Adaptation Plans (NAPs) were established at COP17 in Durban to assist countries in assessing vulnerability to climate change and implementing measures for adaptability. The NAP contains four main elements: (1) laying groundwork and addressing gaps, (2) preparing preparatory elements, (3) creating implementation strategies, and (4) reporting, monitoring and reviewing data.
The main element I want to highlight in regard to its relationship with components discussed in our class on environmental economics is the stage in preparing preparatory elements for the NAP. Making decisions in favor of mitigation or adaptation in regard to climate change is a core component of an environmental economists work. In order to effectively prepare a NAP, questions pertaining to adaptation options must be answered, and in order to do so the organization, possible environmental economists, or party preparing for the NAP must use some of the economic tools for decision-making. In class, we looked at Cost-Effective analysis, Cost-Benefit Analysis, and Multi-Criteria Analysis as tools often used in environmental economics and decision-making. To pick out which tool is used would likely be misleading, as all of them are prone to use at one stage or another.
Presentations at COP19 attempted to answer questions directed towards adaptation plans and their cost-benefit in a manner that confirmed their worth. In a summary of some of the conference activities, the observer delegation from the Vermont Law School reports the presenters proclaim, “Emergency responses to remedy damage from climate change can be even more expensive than investing in adaptation measures. Climate change impacts, like the recent Typhoon Haiyan, often cause GDP to decrease, as developing country governments spend their limited budgets on disaster relief. By investing in adaptation up front, disasters do less damage when they hit, so not as much money is spent on reactive remedies.”In other words, the benefits undoubtedly outweigh the costs.
I can imagine in some examples used throughout the conference that there were extensive cost-benefit analysis performed, or even further, multi-criteria analysis covering the many alternatives and magnitudes of certain adaptations. The observers from the Vermont Law School provide an example, saying, “Bangladesh is currently working on a NAP that looks at health security, disaster management practices, and infrastructure. It currently experiences storm surges and flooding, which impacts crops and food security.” Clearly, various items must be looked at in preparing for this NAP, so there is likely a multi-criteria analysis being performed. Going forward, it seems that the UNFCCC will push for more adaptation measures to be paired with mitigation in order to further combat climate change effects, especially in so-called developing countries.
Sources:
Vermont Law School COP19/CMP9 Observer Delegation Blog
The National Adaptation Plan Process (UNFCCC Report)
Photo source: UNFCCC Flickr
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11 Dec 2013
por
Jacob Jon Pallone
IMSD /
Environmental Incentives – Carrots versus Sticks
Environmental incentives in the United Nations Framework Convention on Climate Change (UNFCCC)
In recent years the UNFCCC debates have centered on the Kyoto Protocol, as an economic ‘stick’ to enforce reductions in greenhouse gas emissions. This year, although the Convention resumed debates on cap-and-trade, investment ‘carrots’ were also identified as valid economic instruments in environmental protection.
The ‘Lighthouse’ companies identified by the Convention create financial incentives, with the reverse effect of taxation, to drive environmental action. Though cap and trade systems also create economic incentives for reductions, by selling a permit, one party enables another party to increase their emissions. For this reason, the overall impact of the trade is not positive.
In this light, maybe we should move our focus towards economic transactions which incentivise positive action overall, rather than enabling negative behaviour. Additionally, we should create incentives for all economic actors, given that greenhouse gas emissions are a global externality. Of the 17 ‘Lighthouse’ companies nominated by the Convention, we can single out the China Clean Development Mechanism Fund (CCDMF) for creating government incentives, ECOCASA for creating business incentives and the Low Smoke Stoves Project for creating household incentives.
The CCDMF works directly with the Chinese government to finance investments in climate mitigation processes. Given that grants are partially financed by private firms and foreign investment, CCDMF reduces the opportunity costs of investing in environmental projects over other public expenditure initiatives.
Similarly, ECOCASA in Mexico reduces costs of implementing environmental standards, but focuses on the housing market in Mexico and works directly with businesses. By providing mortgages and finance for sustainable building, ECOCASA reduces the production costs of low-carbon homes, which in turn increases consumer demand, as illustrated below:
According to the Inter-American Development Bank (IDB), “Mexico’s housing sector already accounts for about 16 per cent of total energy use and 26 per cent of total electricity use”¹ and given the country’s rapid growth we can easily imagine these figures rising. For this reason it is not only essential to change supplier’s objectives, but also reduce prices so that consumers gain the financial incentive for environmentally friendly consumption.
In this field, the Low Smoke Stoves Project in Darfur is a fine example of creating consumer incentives. In providing microfinance for consumers to switch to LP gas, the Global Alliance for Clean Cookstoves considers that this project could reduce principle pollutants by over 95% and energy consumption by up to 70%.² Hence, we see that such initiatives apply to governments, firms and consumers.
Though such projects involve a great deal of flexibility and are not enforced by government regulation, they also reduce national expenditure, so governments can invest in other areas. Due to the economic crisis, many EU nations are reluctant to reduce their emissions, so maybe we should move our focus to individual economic actors… and offer them some tasty carrots.
¹Caceres, A. (2013). Un selects sustainable housing program in mexico as lighthouse activity. In Inter-American Development Bank. Retrieved from http://www.iadb.org/en/news/announcements/2013-11-06/mexicos-ecocasa-a-un-lighthouse-activity,10637.html
²LPG. (n.d.). Bringing low smoke cookstoves to darfur, sudan. In World LP Gas Association. Neuilly-sur-Seine : Retrieved from http://www.exceptionalenergy.com/uploads/Modules/Ressources/Bringing Low Smoke Cookstoves to Darfur, Sudan.pdf
Brittlebank, J. (2013). Cop19: 2013 lighthouse activities honoured at gala event. In Conference of the Parties. Retrieved from http://www.climateactionprogramme.org/news/cop19_2013_lighthouse_activities_honoured_at_gala_event/
Unfccc press release. In UN Climate Change Conference in Warsaw keeps governments on a track towards 2015 climate agreement. Retrieved from http://www.un.org/climatechange/blog/2013/11/20/20-november-2014-wednesday-notes-from-warsaw/
Figueres, C. (2013). Momentum for change. In United Nations. Retrieved from http://unfccc.int/files/secretariat/momentum_for_change/application/pdf/m4c_2013_brochure.pdf
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10 Dec 2013
por
anabeatriceacuna
IMSD /
CAP AND TRADE or BAIT AND SWITCH?
Kyoto Protocol was signed in 1997 by 160 different countries around the world. In 2005, it was ratified by 175 countries. At the same time, UNFCCC (United Nations Framework Convention on Climate Change) was founded in 1992 in order to decrease the industrial greenhouse gases emissions (GHG).
Greenhouse gases are uniformly mixed pollutants, i.e. one ton of greenhouse gas emitted anywhere on earth has the same effect as one ton emitted somewhere else on earth. In abatement strategies, this wants to mean that does not matter where reductions in GHG emissions take place. What matters is whether we are able to reduce the emissions effectively on a global scale (Zhang, 1998).
Source: Greenretreat.org
Thus, according to UNFCCC, emissions trading as set out in Article 17 of the Kyoto Protocol, allows countries that have emissions units to spare to sell this excess capacity to countries that are over their targets.
In this point, we are talking about Cap and Trade System. Cap and Trade or Emissions Trading System (ETS) is a powerful policy instrument for managing industrial greenhouse gas emissions. This system is a market mechanism established by the European Emissions Trading Directive to encourage CO2 emission reduction at the lowest cost in certain production sectors (electricity generation, steel mills, cement industry, tile industry, etc.).
The operation of the “cap-and-trade” scheme is based on two key concepts: (a) setting a cap on emissions without penalty to each Member State of the European Union, and (b) the transfer of allowances between agents.
Source: own elaboration and "Energía y Sociedad" (2013)
Some companies will find it easy to reduce their pollution to match their number of permits; others may find it more difficult. However, trading lets companies buy and sell allowances, leading to more cost-effective pollution cuts, and incentive to invest in cleaner technology. Furthermore, companies could turn pollution cuts into revenue; this provides a powerful incentive for creativity, energy conservation and investment (EDF, 2013). Also, the option to buy allowances gives companies flexibility and while companies may exchange allowances with each other, the same amount of pollution cuts are achieved.
On the other hand, there are some criticism points of view for cape and trade. First of all, Annie Leonard provided a critical view on carbon emissions trading in 2009, in a documentary called The Story of Cap and Trade (Story of Stuff, 2006).
She emphasized three mainly factors: unfair financial advantages to major polluters resulting from free permits, an ineffectiveness of the system caused by cheating in connection with carbon offsets and a distraction form the search for other solutions. Also, recent criticism comes from the American Trucking Association (ATA), which told a Congressional Committee that a “cap and trade program” could result in significantly higher costs in the trucking industry for American consumers.
As a conclusion, I think that we should take care about the situation with a long-term mentality. Therefore, the emissions markets should mature and grow, to evolve and provide wide GHG coverage all the sectors and areas around the world. Besides we need to create a good regulation to support this market and to ensure the transparency of each transaction. Finally, in my opinion, “cap and trade system” is a powerful environmental protection tool and if we use it with another ones that we have, and in a correct way, we could achieve some important goals to allow future generations enjoy our world.
Source: www.ieta.org/emissions-trading
“A true conservationist is a man who knows that the world is not given by his fathers, but borrowed from his children.”
John James Audubon (1800).
BIBLIOGRAPHY
- Energía y Sociedad. “El esquema cap-and-trade y los incentivos a reducir emisiones” http://www.energiaysociedad.es/documentos/E2_Esquema_cap_and_trade.pdf (en línea) Última modificación: 30/05/2013
- Xiang Zhang, Z. (1998) “Greenhouse gas emissions trading and the world trading system” University of Groningen, Netherlands.
- Ellerman, D. (2009) “The EU´s Emissions Trading Scheme: Prototype Global System?” MIT Joint Program on the Science and Policy of Global Change.
- Environmental Defense Fund (EDF), (2013) “How Cap and Trade Works”.
- Parker, L. (2010) “Climate Change and the EU Emissions Trading Scheme (ETS): Looking to 2020” Congressional Research Service, CRS Report for Congress.
- Verdonk, M. Corjan, B. Vollebergh, H. and Roelfsema, M. (2013) “Evaluation of policy options to reform the EU Emissions Trading System. Effects on carbon price, emissions and the economy” PBL Netherlands Environmental Assessment Agency.
- http://storyofstuff.org
- http://www.ieta.org/emissions-trading
- http://www.environmentalleader.com/2009/06/11/criticism-ramps-up-against-cap-and-trade-systems/?graph=full&id=1
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10 Dec 2013
por
guillermojoselatorre
IMSD /
Warsaw Loss and Damage Mechanism
19th Climate Change Conference held in Warsaw was closed one day after scheduled. Described as “a disappointment” by some and as “not a total failure” by others, the Conference was closed after reaching a very unambitious agreement. Most of it is just a loose statement of intentions that would be settled on the 2015 Paris Conference. But among it, stands out an interesting proposal: the Warsaw International Mechanism for Loss and Damage Associated with Climate Change Impacts.
According to the decision statement, the Warsaw Loss and Damage Mechanism will address loss and damage associated with the impacts of climate change in developing countries that are particularly vulnerable to its adverse effects, including extreme events and slow onset events, that cannot be reduced by adaptation.
This mechanism could be seen as a response to extreme weather catastrophes, such as the typhoon Haiyan. This typhoon has killed almost 6,000 people only in the Philippines just a few days before the opening of the Conference, and probably has played an important role in the birth of the mechanism.
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Over the last 30 years, the world has lost more than 2.5 million people and almost $4 trillion to natural disasters. Economic losses are rising – from $50 billion each year in the 1980s, to just under $200 billion each year in the last decade. And about three quarters of those losses are a result of extreme weather”, said Rachel Kyte, World Bank Vice-President for Sustainable Development. “While you cannot connect any single weather event to climate change, scientists have warned that extreme weather events will increase in intensity if climate change is left unchecked.”
The aim of the Warsaw Mechanism will be to create common knowledge base, to provide technological support and, the most controversial point, to give financial support to those countries damaged by climate change weather effects. It will be constituted by an executive committee that will have its initial meeting by March 2014.
It remains to be know how this new institution will be found, how it will valuate the damages caused by the climate change and, the biggest concern for the EU members, how it will discriminate between the natural phenomena caused by the climate change and those that are entirely natural caused.
Comments Off on Warsaw Loss and Damage Mechanism /
07 Dec 2013
por
juancarlosgomezmartin
IMSD /
¡Hola mundo!
Te damos la bienvenida a Blogs EOI. Este es tu primer artículo. Edítalo o bórralo… ¡y comienza a publicar!
Comments Off on ¡Hola mundo! /
28 Oct 2013
por
Gabriela Pella Fernández
IMSD /
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