The Road Reaches Copenhagen

Ecoal December 2009, Volume 69

As we head into the UN climate change talks in Copenhagen at the end of this week, there has been huge speculation on what will happen at the talks, who will attend, and will a successor to Kyoto be agreed. What now seems to be emerging is an acceptance that while all Parties are keen for an agreement to be reached and have been working throughout the year to resolve obstacles to an agreement...time is running out.

There is now a growing expectation that there will not be a legally binding decision in Copenhagen, but rather a political "grand deal" from the 65 heads of state confirmed to attend.

Negotiations & Complications

At COP-13 in Bali, December 2007, Parties agreed the 'Bali Action Plan', a two year negotiating process to agree a comprehensive new post-2012 agreement at COP-15. Negotiations have been ongoing throughout 2009 to try and get countries further down the road towards a final agreement.

However, the international climate change process has become increasingly unwieldy over the years with negotiations conducted under a number of different bodies. Negotiations are also complicated by the fact that goals are being pursued by governments through a number of different negotiating tracks:

• Ad-hoc Working Group of the Kyoto Protocol (AWG-KP)
  - does not include the US;
  
• Ad-hoc Working Group on Long-term Co-operative Action (AWG-LCA)
  - does include the US;
• Major Economies Forum on Climate Change
  - initiated by the US
  - outside the UNFCCC/KP
  - 17 developed and developing country participants
  

They are further complicated by the:

• lack of any agreement by which these tracks could be made to merge;
• proliferation of competing texts produced by each UNFCCC/KP track (running to hundreds of pages);
• proliferation of "non-papers" produced under the UNFCCC/KP track (37 at last count).

There is no agreement on anything in these texts and everything remains in square brackets.

By way of contrast, at this time in the negotiation of the Kyoto Protocol itself, which was finalised in December 1997:

• countries were reviewing a single, considerably shorter text;
• there was broad agreement on differentiated targets for developed nations;
• there was broad agreement on policies and measures and how they were to be included under the KP;
• there was broad agreement on 'flexibility mechanisms' - emissions trading, Joint Implementation, and the Clean Development Mechanism.

Issues to be Resolved

While the real negotiation in Kyoto in December 1997 was essentially about what targets to set individual developed countries, there are a number of unresolved policy issues before negotiators in Copenhagen, including:

• Ambition of the overall target. Various positions include:
  - global 85% reduction on 1990 levels by 2050 with 95% reduction for developed countries;
  - peak in 2015 (AOSIS);
  - 50% reduction by 2050 (EU)
  - 40% reduction by 2020, 80% by developed countries by 2050
  
• Individual developed country targets
• Targets and actions for developing countries
• Offsets
• Sectoral approaches to mitigation
• Nationally Appropriate Mitigation Actions (NAMAs)
  - What are they? Who pays? How are actions verified? Should they be?
• Technology transfer / Capacity building
  - Institutional arrangements
  - Intellectual property rights
  - Financing
  - Land-use change and forestry
  - Credits for halting deforestation?
  
• Technology development
  - CCS? Nuclear? Large-scale hydro?
  
• Financing
  

What Might Come Out of Copenhagen

It now seems unlikely that Copenhagen will result in the integrated, detailed, comprehensive and effective package necessary to tackle climate change. There is also a wide disjunct between media discussion of the process and colder appraisals from negotiators on the inside.

Most commentators are now expecting a document to come out of Copenhagen which outlines a 'Shared Vision' characterised by national leaders agreeing to a political statement that reaffirms their commitment to tackling climate change and agreeing to notions of effort by both developed and developing nations, but with no detail. This could be accompanied by financial pledges and unilateral statements of intent with regard to emissions reductions

Following a meeting in late November and after much speculation, China and the US have come forward with targets of their own: China said it would aim to reduce its 'carbon intensity' by 40-45% by 2020, compared with 2005 levels; while US President Barack Obama pledged to cut US emissions by 17% from 2005 levels by 2020. Both President Obama and Chinese Prime Minister Wen Jiabao have confirmed that they will attend Copenhagen.

What cannot be doubted is the commitment of negotiators - and high-level Ministerial commitment - to reaching an agreement to replace the Kyoto Protocol in 2012. The final agreement may well be delayed until 2010 butwhat is clear is that issues will be resolved, compromises reached...and at some point over the next 12 months, potentially at the next COP in Mexico City in December 2010, a successor agreement to the Kyoto Protocol will be reached.

Coal and Copenhagen

The WCI is looking forward to a positive outcome at Copenhagen. Over the past 12 months, the WCI has been putting forward policy recommendations on what it believes should form part of any successful successor agreement to Kyoto. Going into Copenhagen, the WCI believes:

1. Copenhagen is an opportunity to responsibly balance economic development (and poverty alleviation), energy security and environmental imperatives.
2. There is a wealth of information from the IPCC and the IEA and others that confirms the practical measures necessary to tackle climate change. WCI has urged governments to respond to this information positively and include provision for all low carbon technologies.
3. Reform of the CDM is a priority and must recognise the importance of CCS. Other excluded technologies such as nuclear and large-scale hydro have a role to play
4. Decisions at Copenhagen will affect the ability of industry and business to operate. Copenhagen needs to send the right signals on investment.

CCS & the CDM

To date discussions on the role of CCS in the international climate change processes have centred on whether it should be included under the Kyoto Protocol's Clean Development Mechanism (CDM). The CDM allows developed (Annex I) countries to meet a proportion of their emissions reductions commitments by investing in projects to reduce GHG emissions in developing (non-Annex I) countries. CCS projects are currently not allowed to be developed as CDM project activities. As the CDM is the only mechanism that generates credits for investment in developing countries, the continued exclusion of CCS from the CDM is a major barrier to the deployment of CCS in the developing countries where the technology will be needed most.

How CCS is treated under any agreement from 2012 and whether CCS is in the CDM will have important implications for the global deployment of CCS. The WCI has argued that CCS - as a legitimate and beneficial low-carbon technology - needs to be treated fairly with other such technologies. The CDM should not be about promoting one low carbon solution over others but should be concerned solely with funding mitigationoptions in developing countries that offer the "best mitigation bang for the buck".

The WCI believes the CDM has lost sight of what are means (renewables, CCS, nuclear) and what is the end objective (facilitating developed country finance and expertise to assist developing countries lower their emissions profiles). For that reason alone, the CDM needs urgent reform.

The WCI is not adverse to other mechanisms being created to deploy CCS technologies to developing countries; but at this point in time the CDM is the only game in town. If the opponents of CCS maintain their opposition to it being included in the CDM, Copenhagen is unlikely to see any movement on that front. We have simply run out of time.

However, it does appear likely that there will be support for the creation of a new mechanism that will support CCS and other excluded low-carbon technologies post-2012. That will be a substantive and constructive outcome from Copenhagen that would show real action on global warming.