Honorary Fossil Award: BP-USA

BP-USA is awarded an Honorary Fossil Award from CAN International for fostering our addiction to fossil fuels, an 
addiction that is driving global warming towards dangerous climate change and lies behind the disaster unfolding in the Gulf of Mexico.

The consequences of forgoing a global agreement to move off fossil fuels and invest in a low-carbon future are clear – scientists have run the numbers.  Unless warming is checked temperatures will increase way beyond the threshold for catastrophic climate change. For some countries the toll is already mounting.

As the negotiations began here in Bonn, hundreds died in India and Pakistan during the hottest heat wave on record, with temperatures shooting over 50 C (122 F). This is bitterly ironic given that we have alternatives. Each year we delay, we pass by opportunities to invest in clean energy. The International Energy Agency has calculated the cost of passing by those opportunities at $500 billion a year. At same time $100 billion a year in subsidies are paid to fossil fuel companies worldwide.

Checking climate change and sustaining economic growth depends upon an international agreement to invest in clean energy. BP-USA, a leader in fossil-fuel development that has played out so disastrously in the Gulf of Mexico, is awarded an Honorary Fossil for failing to fulfill its responsibility to help break the fossil-fuel addiction it has fostered and address climate change.

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Green Shoots for the Financial Mechanism

As a low-key session in the all too familiar confines of the Maritim draws to an end, the pressures, ambitions and disappointments of Copenhagen are fading into the background. Green shoots are appearing in the LCA finance negotiations, where the dry discussions of institutions, functions, accountability and authority are turning into a rich and productive engagement. 

Largely stalemated since Accra almost two years ago, polarized positions are giving way to an open discussion and perhaps real movement towards agreement. ECO noted the Philippine delegation responding positively to the US proposal on the outline of a governance structure.  This is the clearest indication to date that the US may finally be willing to engage constructively in setting up a climate fund in accordance with contemporary best practices in global governance.

However, the history of international negotiations is littered with hard-fought but under-resourced funds and institutions. So while we celebrate progress towards agreement on the institutions, we can’t lose sight of the need for agreement on the innovative sources of public finance that can generate financing at the scale required, the need for developed countries to step up and take the lead with truly ambitious emissions reduction efforts, and for near-term global emissions peaking and reductions to levels that will ensure our children and grandchildren a blossoming planet.

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Cut the Nonsense

With an issue as serious as the survival of entire nations, you would think all governments would be able to negotiate the matter seriously and in good faith. However, as last night’s teeth-rattling exercise in negotiations dentistry showed, even agreeing a technical report about potential 1.5° C scenarios is not immune.

During the SBSTA evening session, Saudi Arabia managed to plow through every possible diversion, suggesting for instance that vulnerable countries just use Google if they want more knowledge about the scientific findings relating to their survival, or that it is beyond the capacity of the Secretariat to produce a summary of 
recent scientific studies. Finally they hit on procedural issues as a last 
resort. Keep in mind that early in the week Saudi Arabia agreed to having the report, as long as references to spillover effects were included (as is now in the proposed scope). Instead of the random chaos of Copenhagen, things are reverting back to previous form, and this makes a nonsense of important matters.

Deep feeling was expressed about 
potential impacts on developing countries that export rice, cocoa, tomatoes, coal, oil, manufactured goods, etc. Instead, many of those countries wish there was room for serious concern about the climate impacts to which they are most vulnerable and the increasing speed at which they are experiencing them. Recent science has sounded the alarm: the 2° path might not be enough to guarantee the survival of small island states and dynamic coastlines.

Google is all well and good, but every policy maker ought to know that ‘search’ is one thing and 
‘assessment’ quite another.

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The 30% Solution

Last week ECO talked about the paper published last month by the European Commission, which analyses what a move to a 30% emissions reduction target on 1990 levels by 2020 would mean for the EU. The paper makes a good read and leads to a quite unequivocal conclusion.

The recession has made emission reductions much cheaper than originally estimated. At €81 billion per year by 2020, the total costs of a 30% reduction would be only €11 billion more per year than originally estimated for a 20% decrease. A move to 30% would also reduce spending on pollution control by €3 billion annually. In addition, health co-benefits would be as much as €8 billion in 2020.

Furthermore, the current 20%-by-2020 emissions trajectory would require major and expensive catch-up later on to attain the legislated emission reductions of 80-95% by 2050 at optimal cost.

Shorter-term economic impacts would also result from staying with the 20% target. Cash-strapped EU governments may rightly be scared by the estimate that revenues from the auctioning of emissions allowances may fall by up to €70 billion. Conversely, achieving a 30% emissions reduction target would reduce imports of oil and gas by €40 billion in 2020 at a reference price of $88 per barrel.

Keeping the 20% target would further perpetuate the low carbon price that has resulted from reduced production and over-allocation of emission permits to industrial sectors. The lower the carbon price, the lower the incentive for change and innovation.  While Europe traditionally considers itself a leader in green technologies, this cannot be taken for granted. Other countries are catching up fast.

The conclusion is loud and clear: the EU should move to the 30% target level without further delay.  Unfortunately the same old voices are doing their best to stifle Europe’s lean, green future, using the same old threats about job cuts and production losses if Europe moves to a higher target and others don’t.  But this is empty rhetoric.

First, the economic models used in the communication cast doubt on these claims, estimating an impact on production under a 30% reduction target at around 1% for most sectors if other countries stay with their low end pledges under the Copenhagen Accord. That is the worst case scenario.

Second, how much can you really trust stakeholders who are clearly profiting from the current EU climate regime whilst being required to make minimal emissions reductions?

Analyses by the European Commission and the IEA indicate that emissions of the EU ETS regulated sectors will be about the same level in 2020 as in 2008 if the EU sticks with the 20% target. Industry would make virtually no emissions reduction effort but still reap huge profits.

A recent study cited evidence of windfalls for energy-intensive industries from effectively charging customers for allowances they received for free, to the tune of €14 bn for the refining, iron and steel sectors during 2005-2008.

Another trick has been to accumulate piles of unused emission allowances that can be banked and resold. It is estimated that 10 of the EU’s most polluting firms alone are sitting on stashes worth over €3 billion.

With profits like these, it’s small wonder that these are the voices fighting so hard to maintain the 20% regime. At the same time complaining about the lack of a level playing field, some companies are actively trying to undermine climate action outside of the EU. Members of the industry group Business Europe, for example, have been exposed for lobbying against the regulation of greenhouse gas emissions by the US Environment Protection Agency (EPA), and in favour of offshore drilling in the draft US climate legislation. One European company is responsible for the worst oil spill disaster ever in the US.

The actions of these companies are a cynical ploy to undermine all climate action on an international scale. The EU must heed the message of the recent Commission document, and not fall foul of the same lobby tactics which led to the weak outcome of Copenhagen.

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Time to Review the 1.5 Track

A group of workers were building a railway between two towns. Let’s say one town was called Copenhagen and the next was called Ourcommonfuture.  The railway workers had assembled sleepers (crossties) and rails and knew the distance between the towns.
After a while, some of the railway workers looked at the pile of construction materials. Some of them realised there weren’t enough materials,  and those who most needed to arrive at platform 1.5 in the next town asked for a review of the problem. If you were working on the new track would you agree to the review?
The railway bosses at Copenhagen 
secured broad agreement that we must limit warming to below 2 degrees, with a review of implementation and levels of ambition (considering 1.5) by 2015.  So ECO’s question for delegates is this: If your political leaders are serious about the Copenhagen goal and the review, then a workshop under SBSTA is a good way to focus on the technical and scientific challenges of reaching the goal, the size of the gap between current abatement efforts and the goal, and the opportunities to make up that shortfall.  These are essential elements to making sure we can reach our common future.

If there’s a gap in abatement effort, we need to understand it and find ways to resolve it. The world needs to look at sources like bunkers and industrial gases, consider the role of finance, and seek other ways to reduce the gap between what is happening and what needs to happen.  ECO looks forward to a 1.5 review coming out of SBSTA today. That will give us greater hope that we may reach the final destination.

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Your LULUCF Glossary

Recently the mysteries of ‘land use, land use change and forestry’ (LULUCF) have come to broader attention.
ECO feels that full appreciation of the wonders of LULUCF is often hindered by the technical jargon that surrounds the subject.  To help move the process forward, we offer delegates this glossary of commonly used terms in the debate on forest management.

Forest management: Logging.
Sustainable forest management: Mostly logging.
Harvesting: Logging.
Temporarily destocked: Logged (usually logged natural forest).
Age class structure: Age of forest.
Wrong age class structure: Old trees 
= needs logging.
Conversion: Logging a natural, carbon and biodiversity-rich forest and 
replacing it with a low carbon, low 
biodiversity forest with no penalty (see also temporarily destocked, empty forest, displaced local and indigenous people and Australia).
Unique national circumstances: Need to log (often thought just to apply to New Zealand but can apply to any country wanting to log).

Forward looking baseline: A means of hiding logging emissions (see also Canada and others).
Bar with a band to zero: A means of hiding logging emissions (see also Russia).
Incentive: Not penalising logging emissions and/or allowing them to be hidden, as in ‘give us an incentive (logging loophole) and we will take on a more ambitious  target’
Voluntary: If you might have a high emission from logging then you can opt not to tell anyone.  Notable as being the only term that means roughly the same in English.  (See also ‘not electing for forest management’ and Austria.)
Cap: Term used by the G77 and China but not understood by Annex I.
Harvested wood products: The logging industry’s little joke.

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LULUCF Goes to the Wire

Yesterday’s KP contact group on “numbers” (emissions reductions in Annex I countries) highlighted a question that has dominated the first week of this session: is the land use, land use change and forestry (LULUCF) debate about emission reductions – or is it about creative accounting that undermines overall ambition? The chorus in favor of requiring 
absolute reductions in net emissions from forest management is growing louder:  the Africa Group, COMIFAC, Belarus, India and now the Coalition of Rainforest Nations have all made public statements in this session supporting that goal. So far, they are being stopped cold by the brick wall of an Annex I bloc that prefers to hide increased emissions while trying somehow to create the illusion they are stopping catastrophic climate change. A graph presented in the contact group painted a very clear picture of what is going on: all Annex I Parties except one propose reference levels that either erase all debits or yield massive credits. By contrast, Switzerland chose to accept a debit, thereby creating a policy signal to improve forest carbon management. ECO wants to be clear – we’re not advocating that Annex I countries must receive debits for forest management accounting, but rather that they own up to the true carbon costs of their management activities, regardless of whether that results in credits or debits.  It’s a matter of honest accounting. It also became clear yesterday what the effect of LULUCF rules will be on overall numbers.  Annex I Parties will only take the high end of their targets if they get the LULUCF emissions loopholes that they want. The science says we need at least a 40% reduction by 2020 on 1990 emission levels; pledges on the table amount to less than 25%, and, if Annex I gets its way on the new LULUCF rule set, real reductions that the atmosphere actually sees will be substantially less. It’s time for the G77 and China to step up their demands to hold them to account, but it’s up to the developed countries to take responsibility. So, Annex I, wake up: we’re here to reduce emissions!

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The Time to Find a FAB Deal

ECO is very dismayed to hear that Parties, particularly the US, are considering shortening the duration of negotiating sessions in 2014 and 2015.  While ECO is all for more efficient negotiations, there is more than a hint here that there are alternative motives.  Could it be that this is a way to shift attention to the Major Economies Forum and other non-UNFCCC forums? Those may serve well as informal arenas for discussion and development of innovative ideas, but in no way can they substitute for the UNFCCC as the locale with the resources, scope and legitimacy for international negotiations of the breadth and depth required to negotiate a fair, ambitious and binding deal to stop dangerous climate change.

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