Jonathan Pershing
description
Transcript of Jonathan Pershing
Framing the Post-Kyoto Debate: Options for Climate Policy After
2012
STEP Seminar SeriesPrinceton University
Princeton, NJ
April, 2006
Jonathan PershingClimate, Energy and Pollution ProgramWorld Resources Institute http://www.wri.org
• An update on the science• Greenhouse gases and related indicators• Policy options• The international process: reviewing the state
of play• Framing the debate on next steps• Conclusions
Overview
An update on the science
2005 Temperature Records(Deviation from 1951- 1980 mean)
Source: NASA Goddard Institute for Space Studies Surface Temperature Analysis at data.giss.nasa.gov/gistemp/
Changes in Ocean Circulation
• Transect at 23º N latitude– Measurements
taken in 1957, 1981, 1992, 1998, 2004
• Indicates a 30% reduction in ocean circulation volume since 1957
Source: Ocean current figure: www.NASA.govTransect information: Bryden, Harry L. et al. "Slowing of the Atlantic meridional overturning circulation at 25° N." Nature 438: 655-657. 1 December 2005
Source: ACIA, Impacts of a Warming Arctic, Climate Impact Assessment Report, Cambridge University Press, 2004
Observed sea ice September 1979
These two images, constructed from satellite data, compare arctic sea ice concentrations in September of 1979 and 2003. September is the month in which sea ice is at its yearly minimum and 1979 marks the first year that data of this kind became available in meaningful form.
Observed sea ice September 2003
DEPLETION OF SUMMER SEA ICE
Hurricane Trends
Impacts follow temperature trends
Source: WashingtonPost.com, September 16, 2005, after Science Magazine 9
Scenario of damages in 2050
Source: The Guardian, based on Pentagon report, February 2004
Greenhouse Gases and Related Indicators
Near- and Longer-Term Trends
World GHG Emissions (2000)
Source: WRI, CAIT: http://cait.wri.org
National GHG Emissions, 2000
Per Capita Emissions, 2000
Largest Emitters: Developed & Developing
Projected Future GHG Emissions Growth
% Percent change from 2000
Source: Baumert et al, 2005
World Primary Energy Demand
Source: IEA WEO 2004
Oil
Natural gas
Coal
Nuclear power
Hydro power
Other renewables
0
1 000
2 000
3 000
4 000
5 000
6 000
7 000
1970 1980 1990 2000 2010 2020 2030
Mto
e
0
1 000
2 000
3 000
4 000
5 000
6 000
7 000
1970 1980 1990 2000 2010 2020 2030
Mto
e
Electricity generation: fuel mix
% S
hare
of
Fue
l Mix
Source: IEA Statistics, 2002 data20
GLOBAL CO2 EMISSIONS FOR IPCC/SRES SCENARIO GROUPS
Policy options
What will it take to stabilize the atmosphere?
Need to reduce greenhouse gases globally by
60-80 percent over the century
Population is likely to increase from 6 billion today to 10-12 billion
Economic growth is likely to expand, perhaps
by a factor of 10
Dealing with Climate Change
• Policies cover all gases and all sectors -- but emissions are not evenly divided among these– Energy and CO2 are key
• Policy Choices:– Emit less (be more efficient)– Emit differently (switch fuels or processes)– Sequester– Do without (change behavior)– Adapt (learn to live with it)
• Policy actions include:– Market approaches (taxes, subsidies, cap-and-trade)– Regulations– R&D– Processes/outreach– Foreign Assistance
Policies by Instrument (1999-2004)
Source: IEA (http://www.iea.org/dbtw-wpd/textbase/envissu/pamsdb/index.html)
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Fiscal Tradable Permits Regulatory Instruments Voluntary Agreements RD&D Process/Outreach
GHG Flow Diagram: Global Greenhouse Gas Emissions
Policies by Sector (1999-2004)
Source: IEA (http://www.iea.org/dbtw-wpd/textbase/envissu/pamsdb/index.html)
0%
20%
40%
60%
80%
100%
Buildings Energy Production Industry Transport
Reviewing the state of play
The International Process
International Agreements: The UN Convention and Kyoto Protocol
• Targets: national caps on greenhouse gas emissions; collective reduction of 5.2% below 1990 levels by the 2008-2012 timetable…for 38 industrialized countries and economies in transition (i.e. “Annex I”)
• Market-based mechanisms: designed to achieve global emission reductions at the least possible cost (involves private entities, not just governments.)
• Compliance mechanisms: Emissions measurement standards; reporting requirements; review provisions; mandatory consequences for countries that do not comply.
UNFCCC – State of Play• 1992: UNFCC• 1997: Kyoto Protocol• 1998 – 2001: Following Kyoto, negotiators spend several years
developing rules to implement Kyoto agreement (i.e., Marrakech Accords)
• 2004: Ratification and entry into force (with attendant agreement from Russia on gas and WTO)
• Beginning of post-Kyoto discussions– 2003: New Delhi (Cop 9): focus on adaptation– 2004: Buenos Aires (Cop 10): consideration of post Kyoto commitments– 2005: SB 22: Seminar of Government Experts (SOGE)
• Nov/Dec 2005: Montreal: COP/MOP 1
Montreal Outcomes• Annex I parties continue discussions on post Kyoto
regime – based on emissions markets– US and Australia largely oppose talks– However, at the state/local level, both US and Australia
experimenting with emissions trading regimes• Non-Annex I parties reject any discussion of accepting
binding emissions caps (language allowing discussion of next steps explicitly states it will “not open any negotiations leading to new commitments.”
• Marrakech Accords adopted (with ET, JI, and CDM as well as rules governing forest activities). – News rules opening CDM to “programmatic” as well as
“project” activities
International Politics: the EU
• “Climate Change is a major threat”• “While the Kyoto Protocol takes us in the right
direction, it is not enough. We need to cut GHG emissions radically, but Kyoto doesn’t even stabilize them. It won’t work as intended unless the US is part of it.”
• There are huge opportunities in environmental technology, and huge possibilities in sustainable development.”
-- Prime Minister Tony Blair, 2005
International Politics: Developing Countries
• “Climate change has, and for the foreseeable future will continue to have a profound impact on the development prospects of our societies.”
• “The UNFCCC and the Kyoto protocol establishes a regime that adequately addresses the economic, social and environmental impacts of sustainable development.”
• “The regime rests on differentiation of obligations among Parties…developed countries should therefore take the lead in international action to combat climate change.”
• “The convention establishes economic and social development and poverty eradication as the first and overriding priorities of developing countries.”
-- Joint Declaration, Gleneagles, 2005 Brazil, China, India, Mexico, S. Africa
International Politics: The US
• “Climate change, with its potential to impact every corner of the world is an issue that must be addressed by the world.”
• “The Kyoto Protocol was fatally flawed in fundamental ways.”
• “We’re creating a National Climate Technology Initiative…”
-- President Bush, 2001
Framing the debate on next steps
Form and Stringency Are NOT the Same
Form
Fiscal Measures(taxes, fees…)
Market and regulatory(cap-and-trade, standards...)
Industry agreements
Stringency
What level of effort is required?
Size of tax or subsidy
Level of cap
Stringency of technical standard…
Stringency is about how much…
Meinshausen, Malte. "On the Risk of Overshooting 2°C." Proceedings from International Symposium on Stabilisation of Greenhouse Gas Concentrations -- Avoiding Dangerous Climate Change, Exeter, 1-3 February 2005 at www.stabilisation2005.com/programme.html.
Risk of increased temperature
…which presumes a cost for action as well as a risk from inaction…
Source: IPCC TAR
Implications of delayed action
Source: Meinshausen, 2005
…and when.
Policies & MeasuresGreenhouse gas markets
Sector approaches
Action targetssupply & demand
No-regrets targets demand
Project mechanismsdemand
Adaptation
Technology agreements
Emissions Trading (binding targets) supply & demand
Institutions
Form is everything else
EU and US emission market trendsECX/ICE FUTURES Price and Volume
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
22 A
pr
16 M
ay
07 J
un
28 J
un
19 J
ul
09 A
ug
31 A
ug
21 S
ep
12 O
ct
02 N
ov
23 N
ov
14 D
ec
0.00
5.00
10.00
15.00
20.00
25.00
30.00
35.00
Total Volume
Settlement
Source:http://www.chicagoclimatex.com/mktdata_ccfe/sfi/historical/Historical_Prices.xls
EU ECX Price
US CCX Price
$0.00
$0.50
$1.00
$1.50
$2.00
$2.50
$3.00
$3.505/
16/2
005
5/23
/200
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2005
6/13
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/200
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Vin 2003
Vin 2004
Vin 2005
Vin 2006
CDM growing
• Data based on 919 projects (compare with 716 in December 2005)
• Strong growth started in last Q05 and continues
• 1.3 billion credits expected pre-2012
Source: Scharf & Ellis (OECD), 2006
Country
CO2 Change1990–2002
MtCO2
GDP percapita
(GDP/Pop)Population
(Pop)
EnergyIntensity (E/GDP)
Fuel Mix (CO2/E)
China 1247 122 15 -96 8
United States 863 23 16 -20 -1
France 2 17 5 -6 -15
United Kingdom -36 24 3 -20 -13
Russian Federation -453 -5 -3 -12 -3
% Contributions to CO2 Changes
But setting new post-2012 targets is difficult…
Source: Baumert et al, 2005
…even for a single country
China
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
2002 2025Year
MtC
O2
(fro
m e
ner
gy)
Low
Medium
High
USA
Difference of 1,990 MtCO2 or approx 25%
2002 Emissions
2025 Emissions
(EIA Projections Reference Case)
Kyoto style target 2012
China
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
2002 2025Year
MtC
O2
(fro
m e
ner
gy)
Low
Medium
High
USA
Difference of 1,990 MtCO2 or approx 25%
2002 Emissions
2025 Emissions
(EIA Projections Reference Case)
Kyoto style target 2012
Expectations for the Market Post-2012
• Some Annex I Parties continue with market development (likely to include US, but to exclude Russia) – Key is institutional capacity to manage market compliance,
including adequate assurance of integrity of emissions reductions
– Politics will dictate level of effort; US engagement critical• Some developing countries adopt market approaches and
participate in global emissions trading market (e.g., Korea, Mexico)– China, depending on rate of institutional development, may
engage over medium term (e.g., by 2020)• Other countries continue to participate in CDM/project
offset systems, including with “programmatic” CDM
The alternative to markets: A policy approach
Source: David Victor, Presentation at RFF, February 2006
Policies may not focus on climate…
Source: IEA WEO, 2002
Global Energy Poverty
Other development challenges exist…
Motor vehicles per 1000 people, selected countries
Source: Bradley and Baumert, 2005, “Growing in the Greenhouse”
Motor Vehicle Shares of Criteria Pollutants in Chinese Cities
Source: Schipper and Ng, 2005
City
CO (%) HC (%) NOx (%)
Beijing (2000)
77 78 40
Shanghai (1996)
86 96 56
Guangzhou (2000)
84 50 45
…and are multifaceted…
…including energy security as well as environmental issues
-150
-100
-50
0
50
100
150
200
250
300
1974
1979
1984
1989
1994
1999
2004
Consumption
Production
Exports
Mil
lions
of
tons
of
oil e
quiv
.
Figure 2. Oil Production, Consumption, and Exports in China
Source & Notes: IEA, 2004b, with estimates for 2003 and 2004 based on BP, 2004 and 2005. Negative values indicate imports.Source: Schipper and Ng, 2005
Oil Production, Consumption and Imports for China
0.0
10.0
20.0
30.0
40.0
50.0
60.0
70.0
80.0
90.0
100.0
2003
: Roa
d
2005
2010
2015
2020
Oil Sav
ed20
0520
1020
1520
20
Inte
grat
ed T
rans
port
2005
2010
2015
2020
Car
bo
n E
mis
sio
ns
(Mt)
0
0.01
0.02
0.03
0.04
0.05
0.06
0.07
0.08
0.09
0.1
Car
bo
n(k
g)/
km
Electric Cars
CNG
Oil
Carbon/km
Three scenarios for China: Carbon from Motor Vehicles
Source: Schipper and Ng, 2005
2003 Road Oil Saved Integrated Transport
Considering a Sectoral Agreement
Source: Baumert et al, 2005
Sectoral “Fit” for Agreement
• ICAO has failed to reach conclusions on emissions reduction plan
• EU proposals being considered include:– Fuel tax– Ticket tax– Slot auctioning– Emissions charge– Modal transfer incentives
Sectoral “Fit” for Agreement
• Voluntary agreement through International Aluminum Institute (26 members with 80% of global production)
• Key climate change targets include an 80% reduction in PFC emissions and a 10% reduction in smelting energy per ton of aluminum produced; to be reached by 2010 (using a 1990 base year).
• To date have already achieved PFC reduction of 73%
The technology chain
Government
Research Consumers
Policy I nterventions
Business and Investors
I nvestmentsInvestments
DiffusionCommercial
-isationDemon-stration
Applied R&D
Basic R&D
Product/ Technology Push
Market Pull
Grubb, M. and R. Stewart, 2003. “Promoting Climate-Friendly Technologies: International Perspectives and Issues.” Introductory paper for the INTACT High-Level Transatlantic Dialogue on Climate Change
Technology Penetration
Source: http://www.aimpowergen.com/wind_power.html
Thoughts on the PAMs approach• Moving to scale is possible, but policies likely to differ from
country to country.• Policies that incorporate development priorities can garner
near-term engagement by developing countries, particularly large emitters such as India and China
• Comparing level of effort will be difficult; no single metric is likely to provide robust method for evaluation.– Political agreements, involving complex negotiations, may address
this concern– Public awareness to support national policies will likely require
significant reporting on policies adopted– which, in turn will require international assistance.
• Once sufficient capacity is built, countries may move to adopt GHG market systems
A brief comment on adaptation
Global Impacts of Natural Disasters, 1980 - 2004
Adaptation in a future regime• Money, money, money
– Expected damages amount to several percent of global GDP, with preponderance of damages in developing nations
• New international agreement(s) may provide “steer” for development assistance, but seems, at present, unlikely to establish significant new institutional arrangements to pay for impacts or their amelioration
• Policies are mostly unlikely to be climate specific; key will be links to development– Water resources– Health care– Coastal zone management– Infrastructure development
Conclusions
The post-Kyoto architecture (1)
• New scientific information compels more aggressive action
• The Kyoto structure WILL continue– Emissions trading with new more stringent
targets and some additional countries– Markets will provide stimulus to new technology
research, development and diffusion– Current systems for financial transfer to
developing countries will remain – albeit unlikely to grow significantly
• Kyoto is not likely to be the sole mechanism for future efforts• In parallel to the Kyoto market-based regime, countries
(developed and developing) will adopt policies (including for sectoral and technology based approaches) driven by other concerns:– Energy security (leading to aggressive focus on energy efficiency,
focus on indigenous supply and development of alternative fuel options such as biomass, nuclear, RE)
– Local air quality (technologies such as IGCC, replacement of gasoline vehicles with hybrids and EVs or H2)
– Key is how “climate friendly” these policies will be• Independent of international agreement, we are likely to see
increasing energy investment – including some financial transfers to developing countries– Some new investment in climate friendly technology such as CCS
The post-Kyoto architecture (2)
The post-Kyoto architecture (3)
• We are not on a path to avoid significant climate change
• The question is how hot things will get…
• Adaptation will become a more central policy imperative over time
?