EDF Talks Global Climate

Doha climate talks could see measured progress toward new global agreement

International climate negotiations have begun in Doha, Qatar, where countries can make progress toward a new global agreement, climate finance and reducing deforestation emissions, among other technical issues. Photo credit: Flickr user UNclimatechange

The largest international climate negotiations of the year kicked off Monday in Doha, Qatar, drawing delegates from more than 190 countries in a grand effort to create a global treaty to reduce greenhouse gas emissions and halt climate change.

Worldwide attention is particularly focused on climate after a number of respected and typically conservative global institutions — including The World Bank, United Nations Environment Program, International Energy AgencyPwC – in reports released in the weeks leading up to Doha painted grim pictures of the risks of extreme climate change.

These talks in Doha could see measured progress toward a new global agreement in some areas — or, as The New York Times put it, "the agenda for the two-week Doha convention includes an array of highly technical matters but nothing that is likely to bring the process to a screaming halt."

Environmental Defense Fund anticipates three issue areas could see important progress in Doha:

1) Negotiating tracks

The countries now meeting in Doha are scheduled to finalize a second round of commitments under the Kyoto Protocol, the international agreement to cut greenhouse gases, and wrap up the Long-term Cooperative Action (LCA) negotiating track, which was launched in Bali in 2007 and led many countries to make voluntary emission reduction pledges but fell short of a comprehensive binding agreement.

Doha will also set the course for the “Durban Platform for Enhanced Action” track, whose goal is a new climate deal for all countries to be agreed to by 2015 and to take effect from 2020.

International Climate Program Director Jennifer Haverkamp said in EDF's opening statement:

Countries can make real progress in Doha by agreeing to the Kyoto Protocol’s second commitment period with minimal fuss and delay, and concluding the Long-term Cooperative Action track, so they can turn their full attention to bringing lessons learned and key policy tools from those agreements forward into the new negotiations.

Even the U.S. founding fathers didn’t get the Constitution right the first time – remember the Articles of Confederation? Countries, in constructing this new agreement, have a chance to incorporate the key elements of these tracks: Kyoto’s binding structure and accountability, and the LCA’s broadened participation among countries and new tools to fight climate change.

2) Climate finance

Countries in Doha should deliver clear signals of ambitious commitment to address climate change, a much-needed policy signal that will help unlock and target critical climate finance funds that exist right now in the stock and bond markets and in countries’ national public expenditures.

3) Deforestation emissions

For policies for Reducing Emissions from Deforestation and forest Degradation (REDD+), countries have the opportunity to agree that multiple sources of finance can be used to pay for REDD+ reductions, and thereby send another positive signal to tropical forest nations.

Climate & Forests Specialist Gustavo Silva-Chávez said last week in a blog post previewing the Doha REDD+ negotiations:

REDD+ is almost at the finish line. We need a decision with more direction about how it will be financed, and carbon markets must play a role.

Countries, states making major climate progress

Outside the UN negotiations, countries and states have been busy launching and benefiting from emissions reductions programs. Just since last year’s negotiations:

Here in the United States, California begins its state-wide cap-and-trade system on January 1, and the northeastern states’ regional cap-and-trade system (RGGI) is already cutting emissions while the regional per capita GDP is growing faster than that of the nation as a whole. And a new report shows that the U.S. is on track to reduce its emissions by more than 16 percent from 2005 levels by 2020, thanks in part to these states’ initiatives.

Haverkamp said these moves are all significant:

“A full quarter of the world’s economy – from California to China, Mexico to South Korea – has or is putting in place programs to reduce emission. The top-down UN process is still critical to stopping dangerous climate change, but more and more countries are deciding not to wait around for it to tell them what to do. We’re already in a bottom-up world.”

 

See related post: REDD+ almost at the finish line: Doha preview

Posted in Deforestation, Doha (COP-18), Europe, Forestry, Indigenous peoples, Mexico, News, REDD, UN negotiations |: | 1 Response

REDD+ almost at the finish line: Doha preview

Reducing Emissions from Deforestation and forest Degradation (REDD+) is one of the policy areas in international climate negotiations that has made the most progress in the last few years. With the cutting and burning of trees contributing to about 15% of global carbon dioxide emissions, any realistic plan to reduce global warming pollution sufficiently – and in time to avoid dangerous consequences – must rely in part on preserving tropical forests, and REDD+ policies are key to doing just that.

Countries have made major decisions on the building blocks needed for policies for Reducing Emissions from Deforestation and forest Degradation (REDD+), and now REDD+ is close to being finalized in some of the Doha negotiations. Photo credit: CIFOR

As negotiators begin heading to the Conference of Parties 18  (COP 18) to the United Framework Convention on Climate Change (UNFCCC) in Doha, Qatar to hash out important issues for a global climate agreement, EDF has taken a look at where the REDD+ issue stands now, and where we anticipate it going in Doha.

Countries have made major decisions on the building blocks needed for REDD+, including agreement that REDD+: 1) is a voluntary mitigation mechanism; 2) that it has to be a part of the overall mitigation efforts in the UNFCCC; 3) that strong environmental and social safeguards are vital; and 4) that the goal of REDD+ is to “slow, halt and reverse deforestation.”

With such priming, REDD+ is nearly ready to be finalized in the “LCA” negotiations – the Long-term Cooperative Action negotiating track, where negotiations over obligations for the U.S. and major developing countries are lodged — and then become part of the negotiations for a new climate agreement for all countries that would take effect from 2020. Moving REDD+ into these new “ADP” negotiations (The Ad Hoc Working Group on the Durban Platform for Enhanced Action) is critical, since any new agreement must both include REDD+ and allow countries to meet a portion of their future commitments by paying for real and credible REDD+ tons.

We see at least three major issues that may make progress in Doha::

1. Technical Issues (Week 1):

The technical and scientific body that provides recommendations to the Conference of Parties, SBSTA, meets the first week of Doha to negotiate further guidance on important technical issues such as the assessment review process for reference levels (a snapshot of a country’s emissions for deforestation in a given year) and Measurement, Reporting and Verification (MRV). Last year in Durban, countries agreed on the basis for REDD+ reference levels (RLs) and guidance on the content of REDD+ reference levels country submissions. That decision also called for countries to begin enabling the technical assessment of proposed reference levels once they have been submitted, and initiating work on developing methodological guidance for the technical assessment of proposed REDD+ reference levels.In Doha, SBSTA should start this work and commit to developing a technical assessment process for adoption at next year’s conference.

For measurement, reporting and verification (MRV) of emissions, countries are close to agreeing on REDD+ MRV guidance; however, this issue is complicated by the fact that there are separate overall MRV discussions simultaneously underway in the LCA track. Some countries believe overall guidance needs to be determined before issue-specific details, like for REDD+, can be addressed. Other countries feel that REDD+ has made strong progress and as long as the guidance does not conflict with the overall MRV, countries should move ahead. There are other SBSTA issues (e.g. technical and scientific ones) that will be added to next year’s SBSTA agenda, such as the issue of reference level technical assessment process. We expect that the overall REDD+ guidance will be general, which will give countries the necessary flexibility in constructing their reference levels, MRV and monitoring systems.

Protecting indigenous peoples in SBSTA: A major consideration in developing REDD+ policies is the role of indigenous peoples, who are the best-suited to monitor and protect their land from deforestation. Many indigenous peoples support REDD+ activities that protect their rights to their land and resources, and seek recognition of the principles from the United Nations Declaration on the Rights of Indigenous Peoples. In Doha, we will be supporting indigenous peoples who are advocating in SBSTA for a REDD+ decision to include more guidance and details on Safeguard Information Systems – systems for providing information on how social and environmental safeguards are addressed and respected.

2. Finance and REDD+ in LCA (Week 2)

In the LCA REDD+ track, which starts the second week of Doha, countries have an opportunity to reach consensus on procedures and modalities on REDD+ financing for results-based actions – meaning countries will try to agree on the details for how to pay for REDD+ reductions and what sources of finance can be used. Because the private sector is best suited to pay for REDD+ reductions, we believe that a combination of market and non-market funding should be used to pay for REDD+ reductions. A draft proposal from the Chair of the LCA negotiations at September’s meeting in Bangkok reached no agreement on whether this text should form the basis for negotiations. However, given the ambitious agenda and the fact that the LCA ends in Doha, many believe that this chair’s text or some modification of it will be the starting point for negotiations. If there is no agreement on this issue, it will have to be resolved next year. EDF believes that countries should be able to use the market to pay for REDD+, and that countries with caps on their emissions after 2015 should be able to use a portion of REDD+ credits to meet their commitments.

3. REDD+ as part of the ADP negotiations

Not every REDD+ issue will be finalized in Doha, but with the LCA ending, it remains unclear what exactly will happen to any remaining REDD+ issues. SBSTA and SBI will likely be tasked with further exploring REDD+ issues as needed, but some countries, especially REDD+ countries, are worried that unless REDD+ has a home in the ADP agenda, it risks being left out of the ADP negotiations. We think a smart solution would be to include REDD+ into the ADP framework, which will formally recognize it as a mitigation component of the ADP.

REDD+ is almost at the finish line. We need a decision with more direction about how it will be financed, and carbon markets must play a role. And we need REDD+ to be part of the ADP negotiations so that when the ADP deal is finalized in 2015, countries will be able to use REDD+ credits to meet a portion of their national emissions reductions commitments.

Posted in Deforestation, REDD, UN negotiations |: | 6 Responses

Workshop for Indigenous Technicians Kicks Off REDD+ Capacity Building

  • Compass – check
  • Fluorescent orange flagging tape – check
  • Woods Hole Research Center’s Forest Carbon Measuring Field Guide – check
  • Garmin GPS 62sc units –check

Those were all items that  Indigenous field technicians learned to use, and learned to train their fellow Indigenous peoples to use, for measuring forest carbon at a November train-the-trainer workshop.

The workshop included teams of two from Ecuador, Colombia, Brazil, and Peru. It was organized by a consortium consisting of the Coordinating Body of the Indigenous Organizations of the Amazon Basin (COICA), Inter-American Development Bank (IDB), Environmental Defense Fund (EDF), and Woods Hole Research Center (WHRC). In addition to training, it also covered the basics of climate change and of Reduced Emissions from Deforestation and Degradation (REDD+).

Following this training workshop, each team of technicians has returned to its respective country to hold a series of community workshops over the next six months. The teams have ambitious goals: train leaders from at least 100 communities in their countries; collect 25 measurements of forest carbon from specific locations; and coordinate their work with government authorities, Indigenous organizations, and other organizations involved in REDD activities.

In addition to being a big step forward in actually implementing REDD+ on the ground, this initiative is noteworthy because it marks the first time that IDB has provided direct financing to any indigenous organization to execute a project. Previously, the money would have passed through the government or a northern non-profit such as EDF.  COICA’s capacity to directly receive those funds illustrates the tremendous progress being achieved by indigenous groups in building their institutional capacity.

REDD+ workshop photo

COICA technicians zero in on key coordinates

The workshop was located in Puyo, Ecuador, where many of the Amazon’s tributaries begin. Puyo is  a region where jungle is slowly disappearing as a result of conversion for agriculture.

Drs. Wayne Walker and Alessandro Baccini from WHRC designed a set of activities to build the forest carbon measuring skills. The technicians started practicing navigation using their GPS units to find locations throughout the city, and eventually navigated into denser and more difficult forest. From the forest locations they found with the GPSs, they measured 40 meter by 40 meter plots (about 130 feet by 130 feet), at first in an open grass area and later in a dense forest similar to what they’ll encounter in their countries. Measuring and monitoring of non-carbon forest elements was also discussed.

The technicians will be using similar activities in their two or three-day workshops at the community level. In addition to those practical “field classroom” activities, the curriculum will also include information on REDD+ and climate change that will be taught through adult-oriented learning activities such as participatory mapping and experiential sharing.

EDF and WHRC provided COICA with technical assistance in designing the November training workshop and will support the technicians throughout their six months of holding community workshops and collecting field measurements. While EDF expects the community workshops to be highly beneficial in building Indigenous peoples’ capacity to carry out these activities, we believe this project will also highlight the ability of Indigenous technicians to collect forest carbon measurements on their own and use that data to produce carbon maps and land management plans.

Overall, the ability of Indigenous Peoples to participate in REDD at national levels will visibly be strengthened immensely – a necessity if REDD+ is going to work.

Posted in Brazil, Deforestation, Forestry, Indigenous peoples, REDD |: | 2 Responses

U.S. House passes superfluous bill, EDF calls on airlines to help find global approach to reduce aviation emissions

The U.S. House of Representatives tonight passed a bill that authorizes the Secretary of Transportation to prohibit airlines from participating in the European Union's anti-pollution law. EDF called the bill superfluous — the EU yesterday paused its carbon pollution law that was the target of the U.S. bill — and warned it sets a bad precedent for U.S. foreign relations.

The European Union Emissions Trading Scheme Prohibition Act of 2011 at best is superfluous, and at worst undermines respect nations need to have for each other's laws, EDF's Annie Petsonk said after the House passed the bill. Photo credit

The EU paused its law following the International Civil Aviation Organization's (ICAO) setting in motion a high-level political process aimed at agreeing on a global program for cutting aviation carbon pollution by October 2013.

EDF’s International Counsel Annie Petsonk said in EDF's statement in the House:

Now that ICAO has moved into high gear its effort to get a global system for limiting aviation’s carbon pollution, and the EU has stopped its clock pending the ICAO outcome, at best this bill is simply superfluous. At worst, it undermines the respect that nations need to have for each other’s laws in a globalizing world.

President Obama signaled in his reelection acceptance speech that there is an opportunity for revitalized executive branch leadership on the challenge of climate change.

The aviation question, one of the first climate issues after the elections, puts the spotlight on the White House, which will need to put significant political muscle into helping ICAO reach agreement on a worldwide approach to address aircraft emissions.

The airlines who lobbied so hard for enactment of this bill should join with environmentalists in agreeing on that global approach.

The European Union Emissions Trading Scheme Prohibition Act of 2011 gives the Secretary of Transportation authority to prohibit U.S. airlines from complying with a European law requiring airplanes that land or take off from European airports to account for and limit their flights’ global warming pollution through an emissions trading system.

The bill also requires the Secretary of Transportation to hold the airlines "harmless" of any costs, including both the costs of complying with the European law, estimated to be trivial, and the costs of not complying. The “hold harmless” provisions could launch a wholly unnecessary trade war and stick U.S. taxpayers with up to $22 billion in non-compliance costs.

Before the bill came to the House floor tonight, Petsonk talked to POLITICO, which reported:

Petsonk has long been predicting ICAO would be confronted with the decision, likening the process to past global environmental law cases that began with bilateral bickering but eventually spawned a global dialogue. That means the U.S. should not yet be patting itself on the back about forcing the EU’s hand.

“The EU didn’t say, ‘We’re ending the system.’ They said, ‘We’re giving the ICAO process time’” to work on the issue, Petsonk said.

That means congressional action on a bill that has been in a recess-induced lull for weeks is likely to pass Congress just days after the real progress was made internationally. “It’s like a Fifth of July firecracker,” Petsonk said of the bill.

Aviation is already the world's seventh largest polluter, and if emissions from the industry are left unregulated, they're expected to quadruple by 2050.

Posted in Aviation, Europe, News |: | 2 Responses

The EU Considers Additional Steps to Improve the EU Emissions Trading System

EDF recently published a report examining the results and lessons learned from the world’s first and largest multinational cap-and-trade program to limit carbon pollution: the European Union Emissions Trading System (EU ETS). The report was designed to assist those jurisdictions like California, China, Australia, the Republic of Korea, and others implementing – or considering adopting – carbon cap-and-trade systems, and to highlight what can be learned from the pathbreaking experience of the EU ETS.

The EU ETS continues to evolve, with current debates in the EU focused on how to improve the system as it transitions to a new trading period next year. The EU is considering several reform proposals, including a short-term reform that would delay the auction of new emissions trading allowances until later in the trading period (“backloading”).

The EU’s backloading proposal is a justifiable short-term step that would give the EU time to consider additional structural reforms needed to build on the EU ETS’s success in reducing Europe’s carbon emissions. For instance, the EU’s success thus far in laying the foundation for achieving its 20% emissions reduction target by 2020 has prompted persistent calls among stakeholders in Europe to tighten the EU’s economy-wide target even further: to 30% below 1990 levels by 2020*, or to set an ambitious target beyond 2020 that would provide additional confidence to market actors to make long term investments in low-carbon innovation. The EU plans to publish by November 14 a carbon market report that examines options to increase the long-term ambition of the EU ETS.

A tighter EU ETS target for 2020 and beyond would not only help the EU achieve its aspirational emission reduction target of 80-95% below 2005 levels by 2050, but – according to one study – could create millions of jobs while bolstering investment and GDP growth.

Doing so would also send an important message about EU climate leadership, providing another lesson to the world on how to chart a path forward to tackle the climate challenge.

*Note: The EU has both economy-wide reduction targets and targets under the EU ETS, which includes the power and industrial sectors, among others. At present, emissions under the EU ETS account for approximately 40% of the EU’s total greenhouse gas emissions.

Posted in Europe |: | Leave a comment

EDF selected as representative to UN-REDD Program Policy Board

A child from the Sao Felix community in the Brazilian Amazon. (Photo credit: CIFOR)

Environmental Defense Fund (EDF) is very pleased to be the newly selected representative to the UN Reduced Emissions from Deforestation and forest Degradation (REDD) Program Policy Board for northern (i.e., developed-country) Civil Society Organizations (CSOs). The Policy Board is a critical component of the UN REDD Program, providing strategic direction and approving financial allocations. The Board is comprised of representatives from partner countries, donors to the Multi-Partner Trust Fund, civil society, and indigenous peoples, as well as the Food and Agriculture Organization, the UN Development Program, and the UN Environment Program.

As one of the Board’s Civil Society Observers, EDF will participate in UN REDD Program Policy Board meetings, and solicit concerns to be raised at meetings on behalf of northern civil society organizations; EDF will also share information among its networks about REDD meetings and processes. EDF’s first meeting as a CSO will be the Ninth UN REDD Policy Board meeting in Brazzaville, Republic of Congo on October 26th and 27th (see agenda).

EDF recognizes that there is a lot of confusion surrounding the UN REDD Program and its “cousin” REDD initiatives, and that information on how participating organizations interact with one another, governments and indigenous populations is not always clear or easily accessible. In an effort to answer some of the questions about the REDD process and key players, EDF has prepared a brief explanatory document. In it, you can find a breakdown of the three major REDD initiatives – the Forest Investment Partnership (FIP), the Forest Carbon Partnership Facility (FCPF), and the UN REDD Program – describing which REDD activities they are involved in, which countries they partner with, and their main REDD objectives.

In addition, EDF has set up a specific web page for those interested in the UN REDD program. EDF will update this website with information and news on the UN REDD program meetings, and will promote the discussion of REDD initiatives on various forums and threads as well. Shortly after the Brazzaville meeting, we will provide an update on developments there.

Posted in Deforestation, Indigenous peoples, REDD, UN negotiations |: | 2 Responses

The EU Emissions Trading System is reducing emissions, sparking low-carbon innovation, and growing up. Really.

With 2012 shaping up to be the hottest La Niña year on record and global greenhouse gas emissions continuing to rise, initiatives to reduce global warming pollution are ever more critical. A new EDF report presents important lessons from the experience of the world’s first multinational carbon emissions trading system: the European Union Emissions Trading System (EU ETS).

Jurisdictions as diverse as California, China, the Republic of Korea, Kazakhstan, and Australia are implementing, or are in the process of adopting, cap-and-trade policies to reduce greenhouse gas emissions, and all stand to learn important lessons from Europe.

Why the EU Emissions Trading System matters

The EU’s program is the first and largest cap-and-trade system with enforceable limits on carbon pollution, which gives it a unique position on the world stage. The EU ETS:

Results from the first two trading periods of Europe's Emissions Trading System offer lessons for other jurisdictions on the road to a low-carbon economy. (Photo source: iStockphoto)

  • Began its pilot phase (Phase I) in 2005; the pilot phase transitioned in 2008 into the fully operational Phase II, which will end this year; Phase III will begin in 2013, and last through 2020 (though EU law already provides that emissions will continue to decline beyond 2020).
  • Places strict caps on carbon dioxide emissions from power stations and industrial plants.
  • Applies to about 40% of the EU’s total greenhouse gas emissions, rising to 43% as the ETS expands its coverage to include other industrial sectors and global warming pollutants.
  • Aims to lower the total carbon emissions of covered sectors in the EU to 21% below 2005 emissions by 2020.
  • Includes 30 participating countries, which account for 20% of global gross domestic product (GDP) and 17% of world energy-related CO2 emissions.

As the EU ETS’s first full trading period (Phase II) comes to a close at the end of 2012, our report examines the results thus far of the world’s first carbon cap-and-trade experiment, and looks ahead to its future.

The report, The EU Emissions Trading System: Results and Lessons Learned, reviews the performance of the EU ETS from 2005 until present, and addresses three central points: the EU ETS’s efficacy, efficiency, and market security. (Note: This report focuses on the overall structure and performance of the EU ETS since its inception in 2005, and thus does not discuss the 2012 expansion of the system to include aviation emissions.)

Results and recommendations

Based on our analysis of the EU Emissions Trading System, EDF has identified six major results from the EU ETS's experience, and developed corresponding policy recommendations. The report’s Executive Summary includes additional details on each of the following lessons learned.

1) The EU ETS has achieved significant emission reductions at minimal cost.

As shown below and on page 8 of the full report, the data suggest that the ETS has succeeded in reducing emissions beyond what would be expected from the recession alone, even assuming an emissions growth rate 1% less than the growth in GDP (represented by the dotted business-as-usual line).  ETS sector emissions declined a further 1.8% in 2011, according to recent estimates, while GDP increased approximately 1.4%. However, verified 2011 emissions data will not be available until mid-2013, and thus the graph does not depict the likely drop in 2011 emissions. The EU has achieved this emissions-cutting success at much lower-than-expected cost: according to some estimates, just 0.01% of Europe’s GDP, and that’s without considering the economic benefits of emissions reductions.

EU ETS sector emissions (million metric tons CO2), emissions caps, and EU gross domestic product (GDP), 1990–2015.

 

Recommendation: Emulate the successful design of – and improvements to – the EU ETS, including its focus on the environmental integrity and enforceability of the emissions cap, to unleash the proven effectiveness of cap-and-trade in stimulating low-carbon innovation.

Recommendation: Stimulate long-term emission reduction investments by maintaining a predictably declining, enforceable, science-based cap on carbon.

2) Although over-allocation of allowances and a sharp drop in their prices occurred during the program’s pilot phase in 2005-2007, the policy stability created by longer-term targets subsequently led to durable investments in reducing emissions and deploying low carbon strategies.

Recommendation: Base emissions caps and resulting allowance allocations on measured and verified historical emissions, rather than on estimated or projected emissions.

Recommendation: Provide a predictable long-term policy environment that allows banking of allowances between trading periods.

3) Windfall profits occurred in some member states but can be avoided using a variety of policy tools.

Recommendation: Establish appropriate regulatory oversight of public utilities, and auction some or all allowances.

4) Reforms have improved the elements of the EU ETS that allow emitters to tender credits earned from projects reducing emissions in developing countries (“offsets”), but further reforms would be useful.

Recommendation: Ensure offset programs have rigorous monitoring and accounting methodologies to clarify that emission reductions are “additional” (i.e., below a credible baseline)

Recommendation: Adopt reforms that allow international offset credits only from jurisdictions that have capped some portion of their emissions, or only from least-developed countries.

Recommendation: If linking to other nations’ emissions trading programs, do so preferentially with nations that adopt caps or limits on major emitting sectors.

5) The EU ETS has made significant progress in preventing any recurrence of the tax fraud and theft of allowances that occurred during the program's earlier years.

Recommendation: Establish effective governance and regulatory bodies, as well as preventive electronic security systems, to adapt to evolving cyber attacks and other market security threats.

6) Companies and entrepreneurs have responded to the ETS and its complementary policies with a diverse range of profitable investments in low-carbon solutions.

Recommendation: Institute an ambitious cap-and-trade system to encourage business to think creatively about reducing greenhouse gas emissions.

What’s next for the EU ETS, and why the world should care

The EU will further expand the coverage of the EU ETS in 2013 to include additional greenhouse gases and additional industrial sectors, including the aluminum and chemical industries.

Regions, nations, states and local jurisdictions that are considering capping carbon pollution can learn from the experience and build on the success of the EU ETS, the world’s first large-scale CO2 cap-and-trade system. (Photo courtesy of German Wind Energy Association/© BWE / Thorsten Paulsen)

Additionally, even though the EU ETS’s Phase III ends in 2020, the cap on emissions will continue to decline after that – by 1.74% per year – which provides the critical longer-term certainty needed to spur investment in emissions reductions now.

Nonetheless, a suitable set of complementary policies and measures is essential if the EU is to achieve its aspirational emission reduction target of 80% below 2005 levels by 2050. A more ambitious EU ETS target for 2020 or 2030 would help achieve the EU’s long-term reduction goal. Current discussions in Europe include proposals to tighten the EU ETS cap further, not only to strengthen emission reductions, but also to stimulate economic growth.

Perhaps the most important lesson the EU ETS experience provides is that regions, countries and states can benefit from a learning-by-doing approach to cap-and-trade. Any design flaws and weaknesses of various policy tools are often difficult to anticipate, but can be corrected over time as experience warrants.

With its success and durability now attracting the attention of other nations and jurisdictions that seek to link their carbon trading systems to the EU’s, the EU ETS offers a unique opportunity for other regions, nations, states, and even local jurisdictions that are considering such systems to learn from its experience and continue to build on its success.

Posted in Europe, News |: | 1 Response

State-level REDD+ offers huge climate benefits

Carbon markets are taking giant steps toward becoming a reality, with forests and Reducing Emissions from Deforestation and Forest Degradation (REDD+) central to the process. Many environmentalists support REDD+, but a few want to obstruct it.

Many states around the world are already curbing their greenhouse gas emissions, including by reducing deforestation. Photo credit

A few weeks ago in Chiapas, Mexico, the 17 states and provinces from  the U.S., Brazil, Indonesia, Mexico and Nigeria that make up the Governors’ Climate and Forests Task Force (GCF) met to discuss ways to collaborate on reducing their greenhouse gas emissions, mostly from cutting down and burning tropical forests. Several states are already reducing emissions, on a larger scale than is often recognized.

With California poised to start the first state-wide mandatory emissions reductions program in North America next month, you’d think that environmentalists would welcome more states’ leadership.

But instead, Greenpeace put out a document slamming the GCF for proposing state-level plans to reduce deforestation instead of waiting for national programs. Never mind that a number of the GCF states are larger and have more emissions than many countries. This sounds oddly reminiscent of oil company lobbyists’ arguments that California is wasting its time and its consumers’ money by starting to address the global problem of climate change by itself – or that the U.S. shouldn't act until China and the rest of the world do.

The world needs to start reducing emissions wherever possible, and there are real, practical, effective ways for states to do this now.

In a commentary piece for Carbon Market North America, I describe what I think is the forest that Greenpeace missed (actually, the trees too).

You can read the commentary here: Huge climate benefits from state, local REDD+.

Posted in Brazil, Deforestation, Indigenous peoples, Mexico, REDD |: | 1 Response

Senate-passed bill puts pressure on U.S. Administration, ICAO to limit aviation emissions

I want to tell you what happened over the weekend while no one was looking.

The U.S. Senate passed a bill early Saturday that gives the Administration unheard-of authority to ban U.S. companies from complying with another country’s law. (Photo credit: Flickr user WallyG)

At a few minutes before 2 a.m. on Saturday, just after the U.S. Senate wrapped up its wrangling over the latest funding resolution, a rather extraordinary bill was passed by the Senate.

If the bill is enacted, it would appear to be the first time in our nation's history that Congress has given sweeping authority to a cabinet member to prohibit U.S. companies from complying with the duly enacted law of another nation – and on top of that, to bail out firms that do comply or that get hit with penalties if they don't.

There are only a very few instances in America's recent history in which Congress has prohibited U.S. companies from complying with the laws of other nations. The purpose of those laws is to prevent U.S. firms from being used to implement policies of other nations that run counter to U.S. policy; they include the prohibitions on doing business in South Africa during the period of apartheid, and the anti-boycott laws, which prohibit U.S. firms from furthering boycotts of one country by another, and nowadays cover the Arab League boycott of Israel.

So, what action by a foreign nation was so odious that the Senate found it necessary to give a Cabinet secretary authority to prohibit U.S. firms from complying with it – and to bail U.S. firms out of any costs they might incur from it?

The bill that got through the Senate Saturday morning gives the Secretary of Transportation authority to prohibit U.S. airlines from complying with a European law requiring airplanes that land or take off from European airports to account for and limit their flights’ global warming pollution through an emissions trading system.

The bill also requires the Secretary of Transportation to hold the airlines "harmless" – meaning bail them out – of any costs, including both the costs of complying with the European law, estimated to be trivial, and the costs of not complying (the latter could be steep).

Aviation is already the world's seventh largest polluter, and if emissions from the industry are left unregulated, they're expected to quadruple by 2050.

With the passage of the Senate bill, the spotlight now zooms onto the Administration, in particular the Secretary of Transportation, and the talks at the International Civil Aviation Organization (ICAO) to reach a global agreement to limit aviation emissions — and to reach it quickly. 

Below are some questions we have received on this bill, and my responses.

What is it in the European law that runs so counter to U.S. policy that it justifies this drastic action?

The airlines argue that the law violates U.S. sovereignty because the law holds airlines accountable for the entire pollution of the flights – even pollution occurring in the airspace over the sovereign territory of the United States.

But the fact that the European law applies to the entirety of the flight cannot be the reason it is counter to U.S. policy.

In fact, it's expressly the policy of the United States to apply our laws to a whole host of issues through the entirety of flights coming in and out of the U.S. – including portions of flights wholly over foreign sovereign territory.  U.S. laws governing everything from security screening, to banning liquids and gels, to barring gambling apply to flights landing and taking off from U.S. airports, including the portions of the flights occurring in and over foreign lands.

Could the reason the European law is so counter to U.S. policy be that, as the U.S. airlines allege, it's a tax?

The law does require flights landing or taking off from European airports to hold sufficient pollution allowances to cover the amount of pollution coming out of the backs of their engines, and if they don't have enough allowances, they can buy them from European governments.

But it can't be that flight taxes per se are objectionable to the U.S. government. After all, Congress makes every traveler coming in and out of the United States pay a $16.70 international departure and arrival tax.

The aviation industry is world's seventh largest polluter. With the passage of the Senate bill, the spotlight now zooms onto the Administration, in particular the Secretary of Transportation, and the talks at the International Civil Aviation Organization (ICAO) to reach a global agreement to limit aviation emissions– and to reach it quickly.

And as courts have already found, the EU law isn't actually a tax:  if the airlines don't want to, they don't have to send a cent to European government coffers. They can simply fly more efficiently.  And if they don't want to do that, they can buy and sell pollution credits in the global marketplace without ever paying European governments a dime – and maybe even make money in the process.

In the run-up to the passage of the airline pollution bailout bill, a few changes were made that tell the Secretary of Transportation, if he does ban the airlines from complying with the European law, to reconsider his ban if the Europeans amend their law, or if an international agreement is reached to address this pollution, or if the U.S. adopts a regulation (which could take years).

The international agreement provision is the interesting part – it puts pressure on the International Civil Aviation Organization (ICAO) to amp up its action on climate change and agree on a global program at its next triennial Assembly in 2013.

But other parts of the bill – including those that bail the airlines out of any costs of complying – or not complying – with the law, remain.

Minor changes to the bill ensure that those costs won't be paid out of the airlines' taxpayer-funded trust fund, but taxpayers could still be on the hook if the airlines win a court judgment that the Secretary is required to hold them harmless, as the bill requires, so that the monies come from the taxpayer-funded Judgment Fund, a part of the U.S. Treasury used to satisfy court judgments against the United States.

What if the Secretary invokes his authority under a little-known airline competitiveness law that allows him to impose retaliatory penalties against airlines from countries that the Secretary finds are treating U.S. airlines “unreasonably”?

And what if the Secretary uses that authority to hold U.S. airlines harmless from the European law by dunning Lufthansa, British Airways, and other European airlines for the U.S. airlines’ compliance or non-compliance costs?

Those companies would likely protest in court. But if the Secretary's cost-dunning order were upheld, Europe could retaliate under its own airline competitiveness law and impose retaliatory fees on U.S. airlines.

Then you have a full-scale trade war. And since U.S. airlines have both code-share and revenue-share agreements with European carriers, a trade war on this issue amounts to shooting themselves in the wing.

What happens next?

A similar bill has already passed the House of Representatives, but because the bills have some differences, the House will have to take it up again when Congress reconvenes after the November elections.

Could it be that the part of the bill that's antithetical to U.S. policy is really the fact that the  European law addresses climate change?

Maybe that's the case for the U.S. Congress at this sad juncture in our nation's history.

But is it also the case that the Obama Administration is so opposed to climate action that after 15 years of fruitless international efforts to curb aviation's global warming pollution, the Administration would stand in the way of other nations' efforts to address that pollution?

We don’t believe so. And if the bill passes, we and others will certainly be encouraging the Administration to find that it is in our public interest lies in striking a real deal in ICAO, rather than turning U.S. airlines into scofflaws at taxpayer – or the flying public’s – expense.

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In Bangkok talks, countries grapple with transition to new climate regime

The latest round of UN climate negotiations in Bangkok ended today with Executive Secretary Christiana Figueres touting the talks' "positive momentum" and "concrete progress," and the NGO coalition Climate Action Network sounding notably less enthusiastic.

Above: Delegates met in Bangkok for a week of climate negotiations to prepare for the major conference later this year in Doha. (Photo credit: flickr user UNclimatechange)

Environmental Defense Fund Attorney Alex Hanafi said in EDF's closing statement:

In Bangkok, it became clearer still that the prospect of a new climate deal that calls for all countries to do their part to lower emissions is still in its very early stages, and countries are grappling with how to transition from the old regime to a still as-yet-undefined new one.

Outside the slogging UN negotiations, however, momentum for action on climate change continues growing at national, regional and state levels. For instance, Alex said:

Australia and Europe’s agreeing to link their carbon markets last month is the latest example of the kind of international cooperation needed to stitch together climate action into a whole that will be greater than the sum of its parts.

The next — and the year's biggest — round of international negotiations begins in November in Doha, Qatar.

In Doha, Alex said, countries' success will be measured by their ability to do two things:

  1. expeditiously resolve their differences on the continuation of the Kyoto Protocol, and
  2. then focus on making substantive progress toward achieving a strong, enforceable and flexible climate agreement by 2015.

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