October 25, 2000

Should fat cats guard the cream?

Industrialised countries want to monitor their own compliance to the Kyoto Protocol.

As participants maintained divergent views on almost all controversial issues during discussions in the thirteenth session of subsidiary bodies (SB-13) in Lyon, Michael Zammit Cutajar, UN executive secretary for climate change, warned that if countries do not reach clear decisions at talks in November, the entire process could collapse.⁽¹⁾ The possibility of ratification of Kyoto Protocol seems more distant with consensus eluding delegates in the run-up to the sixth conference of parties (CoP-6) to United Nations Framework Convention on Climate Change (UNFCCC). To enter into force, the protocol requires ratification by at least 55 countries that are parties to the convention, with developed countries representing at least 55 per cent of the total carbon dioxide emissions of all developed nations in 1990. SB-13, the last important forum before CoP-6 that provided an opportunity to resolve differences, saw countries towing their well-known positions on key protocol issues like sinks and compliance.

Compliance

International agreements, more often than not, are accompanied by a compliance mechanism based on trade sanctions. But the Kyoto Protocol presents a unique situation where, for a change, economically powerful nations have to comply with various provisions of the agreement. It is very obvious that the usual ‘punishment’ of imposing sanctions in the event of non-compliance is not relevant in this context. Countries like Canada, Japan, New Zealand, Russia and the US were interested in relying on borrowing of emissions from future periods while the EU proposed a compliance fund as a consequence of non-compliance. If a country has not met its reduction targets, it can pay into this fund and be declared in compliance with the protocol commitments. Australia was opposed to issuing cautions and levying financial penalties on defaulters.

Climate Action Network (CAN), a group of non-governmental organisations, considers the idea of a properly designed compliance fund as superior to borrowing. Money from the fund can be invested in mitigation projects in developing countries; the group calls for a positive list of sustainable development projects to choose from and demands that sinks projects should not be eligible for investment by the fund. Other consequences suggested include simply formulating an action plan for compliance or restricting the use of mechanisms.

A single compliance committee with two branches: one, to assess and address compliance with the protocol commitments for countries with targets and second, to facilitate climate change mitigation efforts of all countries, was proposed by the EU. Establishing a facilitative wing to aid developing countries in meeting their obligations of compiling and communicating information on adaptation and mitigation projects and developing database to reduce uncertainties related to climate change means acknowledging the common but differentiated responsibilities of all countries. Developed countries like the US, New Zealand and Australia were not in favour of making any distinctions between countries with commitments to reduce greenhouse gas (GHG) emissions and those without any commitments while discussing consequences of non-compliance.⁽²⁾ Developing countries, though, demanded that enforcement measures of the proposed committee should be applicable only to countries with targets. Others should be assisted in their endeavour to fulfill the obligations and no enforceable compliance measures should be adopted against them. The US accepted the EU proposal of a two-body committee, though, it refrained from commenting on developing countries’ demand for equitable representation of all geographic regions in the committee. At the twelfth session of subsidiary bodies, New Zealand had sought greater representation of developed countries given their more significant obligations.

The question of who could trigger compliance proceedings was not settled completely. Australia felt that a country should not be allowed to raise questions of compliance with respect to another country. This stand was not acceptable to G-77 and China, which favoured an effective compliance system where countries could be held accountable to each other. It remained doubtful if the compliance system would extend only to the protocol commitments or also to commitments ‘referred to’ in the Protocol (implying FCCC commitments such as assisting developing countries in adapting to adverse effects of climate change and technology transfer). China, with several other developing countries, argued for inclusion of adverse effects of climate change and impacts of response measures under the purview of the enforcement body whereas the US wanted determination of non-compliance to be restricted to reduction commitments and assessing eligibility for flexibility mechanisms.

Sinks

The US, Canada and Russia are strong contenders of utilising sinks to achieve as much as half of their GHG reductions. But differences persisted on eligibility of additional human-induced land use, land-use change and forestry (LULUCF) activities and on separating human-induced activities from natural uptake of carbon. The US and Japan proposed (re) establishment of forests through natural means as a form of afforestation or reforestation while New Zealand, Australia, Norway and the EU called for distinguishing between natural and direct human-induced activities in order to maintain the sanctity of the protocol.⁽³⁾ A proposal with no distinction between natural and direct human-induced activities allows the US to count all regeneration, resulting in a large amount of credits, without any real reductions of emissions at source. Japan and the US also opposed using a cap on credits from LULUCF activities. According to research conducted by the Max Planck Institute for Biogeochemistry, Germany, old, wild forests are far better than new plantations at sequestering carbon dioxide from air.⁽⁴⁾ Scientists point out that some countries could be tempted to cut down old forests now and then plant new trees on the deforested land in order to gain credit for removing carbon dioxide. Adequate safeguards must be put in place to prevent this.

Japan and Australia supported inclusion of additional activities relating to agricultural soils and land use change and forestry activities from first commitment period itself but the EU contended that scientific concerns related to sinks needed to be resolved first. CAN also advocates that these additional activities should not find a place in the first commitment period given the uncertainties in estimation and the sheer quantity of credits that would then become available to developed countries. Canada went as far as making the inclusion a condition for ratification of the protocol.

The Forum of Indigenous Peoples and other Local Communities on Climate change, a group established to voice the interests of natives living in forests and other critical habitats, has accused developed nations of making a farce of the climate change negotiations.⁽⁵⁾ According to the group by proposing to plant more trees, these nations are trying to buy the right to pollute. "Not only are indigenous people on small island states on the brink of losing their lands to sea level rise but indigenous people throughout the world, particularly forest dwellers are in danger of losing their lands and livelihoods to proposals to plant thousands of hectares of trees to act as gigantic carbon sponges," says a representative of a newly formed indigenous people’s group depending on these ecosystems.

Immense political pressure is building up around the issue of LULUCF activities with developed countries not ready to let go of the potential reduction credits that sinks can generate. As with almost every aspect of the protocol, to avoid a stalemate, opponents of sinks are now willing to compromise on the condition that strict rules and guidelines apply.

Discussion on the contentious issue of including LULUCF projects under the Clean Development Mechanism (CDM), a flexibility mechanism that allows developed nations to invest in clean projects in developing countries in return for emission reduction credits, was not very fruitful. Latin American countries submitted a paper supporting the eligibility of these projects under CDM. The EU was opposed to the inclusion, at least in the early stages of implementation of the protocol, citing difficulties like non-permanence, potential for promoting inappropriate forestry and adverse impact on biodiversity. It maintained that a list of eligible projects under CDM should consist of environmentally sound technologies. High uncertainty in measuring stored carbon and in determining baselines, especially in developing countries, and potential size of credits that can be gained through these activities has made their inclusion highly debatable. New Zealand, Australia, Japan, Canada, Norway and the US strongly favoured them as eligible options under CDM.

Nuclear Power

The deadlock on the eligibility of nuclear power under CDM also continued as countries stuck to their well-known positions. France, presently holding the EU council chair, had not actively opposed the consensual decision of the EU in June to support nuclear exclusion but it did little to promote that decision in Lyon.⁽⁶⁾ Pro-nuclear countries like France, Canada, Japan, South Korea and the UK have pinned their hopes on the US to ensure a nuclear energy favourable list of eligible technologies. Latin American countries and Association of Small Island States (AOSIS) were opposed to use of nuclear projects. The smaller countries fear that if nuclear gets an eligible status under CDM, big developing countries will suck most of the investments providing huge emission reductions per nuclear project. China is already waiting for nuclear power plant cost to be subsidised by virtue of inclusion under CDM as it is hard to justify economically any plans to introduce more reactors otherwise.

At a general conference held in Vienna in September 2000, International Atomic Energy Agency (IAEA) adopted a resolution on strengthening technical cooperation activities with a reference to CDM.⁽⁷⁾ Among other things, it included providing relevant information on role of nuclear power in mitigating GHG emissions and helping countries in implementing projects. During the conference, the European Commission sidestepped the EU’s consensus decision by informing the plenary that if a part of nuclear power electricity production decreases, the EU might not succeed in its target of reducing GHG emissions by 2010 to 7 per cent below 1990 levels. Instead if nuclear output were to fall, emissions could increase 10 per cent over 1990 levels by 2010 and 15 per cent by 2020.⁽⁸⁾

Deliberations on poor countries’ core issues of adaptation, capacity building and technology transfer saw developed nations still fixated on assessing of needs, tending to tilt the balance of responsibility on the former. This position came in for flak when G-77/China said that the least developed countries (LDCs) and AOSIS had identified their needs and insisted immediate action rather than dilly-dallying on assessments and reviews. Oil exporting countries sought compensation in case efforts to cut GHG concentrations result in a decrease in fossil fuel consumption but the demand did not cut ice with industrialised countries, especially so in the wake of spiraling oil prices.

With the subsidiary bodies negotiations not yielding much to rejoice, it is now up to the ministerial conference at The Hague to derive meaningful elements from the Lyon meet and achieve a balance to pave the way for ratification of the Kyoto Protocol.

1. Gillian Handyside 2000, UN warns world leaders against global warming, in The Asian Age, New Delhi, 17 September, p-5.
2. International Institute for Sustainable Development (IISD) 2000, Summary of the thirteenth sessions of the subsidiary bodies of the UN Framework Convention on Climate Change, http://www.iisd.ca/vol12/enb12151e.html
3. United Nations Framework Convention on Climate Change (UNFCCC) 2000, Methodological issues land-use, land-use change and forestry Consolidated synthesis of proposals made by Parties Note by the Chairman, FCCC/SBSTA/2000/9, http://www.unfccc.int/resource/docs/2000/sbsta/09.htm
4. Andrew C. Revkin 2000, Planting new forests can’t match saving old ones in cutting greenhouse gases, study finds, in The New York Times on the Web, 22 September 2000, http://www.nytimes.com
5. Jaya Ramachandran 2000, Indigenous strive to influence global climate talks, http://www.twnside.org.sg/title/strive.htm
6. Mark Hibbs and Ann MacLachlan 2000, US told EU in Lyon it will block ban on nuclear in CDM, in Nucleonics Week, 28 September 2000, Vol.41, No. 39.
7. Corine Veithen 2000, can-talk, 25 September 2000, can-talk@igc.topica.com
8. ibid

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