Peter Hayes and Kirk Smith What was decided at Rio? The Climate Change Convention signed at Rio sought:
To paraphrase, the world's leaders committed themselves to work together in first slowing and then stopping the growth of greenhouse gases in the atmosphere at concentrations that would not be so greatly above natural levels as to significantly threaten human welfare and natural ecosystem balance. In this process, other important goals must not be sacrificed, including provision of adequate food supplies and eradication of poverty. Abatement commitments Developed countries committed themselves to a vaguely worded 'aim of returning individually or jointly to their 1990 levels [of] these anthropogenic emissions of carbon dioxide and other greenhouse gases not controlled by the Montreal Protocol.' Developing countries which signed the treaty undertook to provide an inventory of greenhouse gas emissions and sinks and a national climate change response strategy. They undertook no specific commitments to reduce their greenhouse gas emissions. Indeed, developing countries asserted their right to increase their greenhouse gas emissions. As the preamble to the treaty states: All coutries, especially developing countries, need access to resourses required to achieve sustainable social and economic development......In order for developing countries to progress towards that goal, their energy consumption will to grow taking into account the possibitities for achieving greater energy efficiency and for controlling greenhouse emissions in general, including through the applications of new technologies on terms which make such an application economically and socially beneficial. In effect, parties from developing countries made any future possible abatement commitments on their part contingent upon the developed world demonstrating its intent to make available atmospheric space for future growth in emissions from the poor countries; and upon financing and technology transfer that would enable the poor countries to fulfil more stringent commitments in the future. This refusal to commit to reductions enabled the developed world to leave vague the exact scope and scale of their commitments to provide funds and technology. The Climate Change Convention addressed four key issues that determine who will pay for the costs of incremental abatement in developing countries. These are the provision of financial resources, technology transfer, an interim financial mechanism, and the definition of incremental abatement cost. The following sections briefly outlines the agreement reached on each of these concerns. New and additional financial resources In Article 4 of the Convention, developed country parties committed themselves to 'provide new and additional financial resources to meet the agreed full costs incurred by developing country Parties in complying with their obligations under Article 12.' They also pledged to 'provide such financial resources, including for the transfer of technology, needed by the developing country Parties to meet the agreed full incremental costs of implementing measures.' The flow of financial resources and technology, states the treaty, is to be accomplished at a level adequate to the task, and in a predictable fashion . The Convention also declares that developing countries can claim extra assistance if they are particularly vulnerable to the adverse effects of climate change and related adaptation costs. In addition to small island, land-locked and transit states, countries are also eligible for extra help if they have: lowlying coastal areas; arid and semi-arid areas, forested areas and areas liable to forest decay; areas prone to natural disasters, drought and desertification; high urban atmosph- eric pollution; fragile ecosystems, including mountainous ecosystems; or are highly dependent on income generated from the production, processing and export, and/or on consumption of fossil fuels and associated energy-intensive products. Technology transfer The developed country parties also undertook to 'take all practical steps' to 'promote, facilitate and finance, as appropriate, the transfer of, or access to, environmentally sound technologies and know-how' to developing country parties, as well as to support the development of endogenous capacities and technologies within developing countries. Not only did the developed countries recognize that the ability of developing countries to fulfil their commitments will depend on provision of financial resources and transfer of technology; but they also recognized that developing countries must develop at the same time. In effect, developed countries admitted the obvious: that emissions from developing countries must and will increase and that reductions in the rich countries must offset this inevitable increase in emissions by the poor. Financing mechanism In Article 11, the signatories to the Convention declared that they would create a mechanism whereby grants or concessional financing would be achieved. Moreover, they decided that this mechanism would be accountable to the conference of parties to the Convention. Thus, although it was agreed that the World Bank's Global Environment Facility (GEF) would be entrusted with this responsibility as an interim measure, ultimate control over the mechanism does not rest with the Bank but with the parties to the treaty. As the treaty states that the financial mechanism shall have an 'equitable and balanced representation of all Parties within a transparent system of governance' the signatories effectively defined a reform agenda for the governance of the GEF. GEF is given four years to work effectively, at which time the parties reserved their right to review and redefine the financial mechanism used to implement the Convention. To reinforce this point, Article 14 declares that the GEF must be 'appropriately restructured and its membership made universal'. Full incremental cost The treaty did not define what constitutes the 'full incremental cost' of abatement in developing countries, except to refer to the costs of reporting on national emission sources and sinks and in conducting research on climate change, and for costs incurred on such activities as are agreed between developing countries with the international financial mechanism created under the Convention. The latter step, however, implies that the international community will adopt guidelines as to what are admissible costs. The mandate of the new Working Group lll of the Intergovernmental Panel on Climate Change covers these technical and economic issues. Almost certainly, the restrictive criteria adapted by the Global Environment Facility will be widened as it would not support many sound greenhouse abatement measures under its current guidelines. In short, the signatories to the Convention did not define the specific levels of abatement nor the scale and content of the effort required to achieve the overarching goals of the treaty. While some found this disappointing, most analysts viewed it as inevitable that, as a 'framework,' the Convention would only outline a set of general principles and obligations in various areas. Subsequent negotiations are to produce specific targets and quantitative reductions which - if agreed to will be added as protocols to the framework Convention . Protocol negotiating difficulties Protcols to the Convention that deal with carbon dioxide, methane and other greenhouse gases must address and resolve much more difficult and complex issues than the Vienna Convention that covers ozone depleting gases. Relative to ozone depleting gases, for example, these gases are far more integral to lifestyles. Take, for example, methane emitting rice paddies in Indonesia, carbon dioxide spewing automobiles in cities such as Melbourne, or slash and burn agriculture in the highlands of Papua New Guinea. Moreover, the number of producers and consumers of these greenhouse gases is far greater than was the case for ozone destroying gases which created a trading cartel devoted to eliminating its major product. In comparison, climate change presents many novel negotiating difficulties to the international community (see Table 1.1) which have not been overcome in the Convention. First, free riding on a greenhouse gas reduction regime is likely and attractive at all levels of human society - international, regional, national, and local. Second, a successful agreement will be based on measures that are in national self-interest, are normatively self-policing or are economically selfregulating. Third, greenhouse polluters are separated in time (crossgeneration- ally) and space (due to global mixing rates relative to mean residence time of greenhouse gases) so that liability is difficult to determine. Fifth, responsibility is clouded further by uneven regional climate impacts. Sixth, institutional change within states to implement greenhouse reductions will also be major compared with those entailed by past environmental agreements. Finally, the economic costs of reducing greenhouse gases may be large, concentrated on existing interests at the national or subnational level, and may involve restrictions on existing resources rather than the allocation of new resources as in the Law of the Seas negotiations. These costs are given a great deal of attention in this book due to their importance in determining who should pay what to whom in a global greenhouse regime. Admittedly, the economic benefits of curtailing greenhouse gases may be also large because damages from climate change may be immense. But the realization of the benefits of avoiding climate change is uncertain, will likely come later rather than sooner, and will be distributed diffusely. Moreover, the benefits of using current emissions are widespread; and stakeholders in the status quo are well organized and powerful. As was evident in the negotiations leading up to the Climate Change Convention (see Chapter 14), the size and ranking of greenhouse gas polluters (depending on how emissions are measured) cut across virtually all prior axes of interstate negotiation on security, economic, or environmental grounds. Simple targets make little sense as the energy intensities of economies vary internationally by an order of magnitude. Other simple criteria such as population, per capita GDP, fuel mix, energy reserves, and industrial patterns greatly complicate emission reduction or energy efficiency targets. Determining the net emissions of greenhouse gases is also more difficult than for ozone depleting gases. Ozone depleting gases come from a relatively small number of human sources, and the gases remain in the atmosphere for hundreds of years before they decompose. In contrast, the major greenhouse gases have large natural sources and sinks, and have much shorter lifetimes in the atmosphere. States may claim that nationally controlled sinks for greenhouse gases should be subtracted from national emissions of greenhouse gases in determining emission quotas. Others mav object strongly on grounds of scientific uncertainty (nearly a quarter of the carbon sink is currently unexplained by scientific models) or to the allocation of sink property rights. The concept of sink itself is a shifting sand on which to base target emissions and allocations (see Chapter 2). The IPCC has already produced an index of heating equivalence across greenhouse gases and normalized to carbon dioxide, as was done in the Montreal Protocol across ozone depleting gases. However, many of the ozone depleting gases were close technical substitutes. It may be more difficult to apply the scientific equivalencies that might be used to evaluate control activities within an overall weighted emission quota for greenhouse gases than it was in the Montreal Protocol. Either a CO2-only or a separated, gas-by-gas protocol is therefore more likely under the Convention than an integrated, multiple-gas protocol implied by the ozone precedent. Faced with such vast uncertainty, many scientists suggest that a 'no regrets' policy should be implemented now by incurring short run costs of emission reduction in anticipation of uncertain, long-run benefits. Incontrovertible validation of scientific simulations of climate change may not be available until (if the models are right) massive climate change may be irreversible. By reducing climate change, prudent behaviour now may deny positive evidence that the scientific models were correct. Relatedly, frequent, rapid and unforeseeable changes may occur in scientific assessments of climate change, making negotiations on protocols to the Convention crisis-ridden and fraught with uncertainty. In this book, the authors explore the implications of a 'no regrets' policy in which emissions-reduction measures are chosen along a 'least-cost' pathway. These measures consist of energy efficiency projects and other actions that will have many other benefits even if present climate change concerns should turn out to be unwarranted. This policy option entails radical reductions in carbon emissions to about 50-60 per cent less than those in 1990. This stringent reduction goal therefore poses an unambiguous and measurable challenge to today's decision makers that must be met if they are to fulfil their obligations to future generations.
Table 1.1 Greenhouse gas negotiating novelties
GHG: greenhouse gases
Source: Peter Hayes and Kirk Smith, eds, The Global Greenhouse Regime. Who Pays?, United Nations University Press and Earthscan, London, 1993, pp7-13.  |
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