1.1. Justice not done at climate talks – Weak Cancún package lacks substance
11 December 2010, FOEE
UN climate negotiations have ended after two weeks of negotiations in
It is a package that has prevented collapse but has failed on the most important essential part – the substance.
Friends of the Earth Europe criticises the role of industrialised rich nations, including the Europe Union. The EU did not fulfil its promise to play a progressive role by hiding behind inaction from other countries and using the climate negotiations to push for the expansion of carbon markets.
Susann Scherbarth, climate justice campaigner for Friends of the Earth Europe said: “Justice was not done in
The adopted package could put the planet on track to catastrophic temperature increases of up to 5°C.
Despite setting up a Green Climate Fund and recognising that current emission targets are not enough and have to be scaled up, real substance to prevent catastrophic climate change is missing. Key provisions are still in doubt – the future legal framework is unclear, deep emission cuts for rich industrialised countries are missing, it brings in the pledge and review system from
Pushing for the expansion of carbon markets will not solve the climate crisis. The European Union Emission Trading System (EU-ETS) is failing to deliver emission cuts and is blocking other more effective policy measures. 
The European Union must acknowledge its historical responsibility for causing the climate crisis and commit to binding emission reductions under the Kyoto Protocol of at least 40% by 2020, without relying on carbon offsetting. 
In the absence of an agreement that prevents dangerous climate change, Friends of the Earth Europe continues to demand binding national climate legislation, which would commit countries to making annual cuts in greenhouse gas emissions. 
Susann Scherbarth, climate justice campaigner for Friends of the Earth Europe added: “There is one promising and motivating outcome here in
11 December 2010, Can-E
Decisions adopted in the wee hours in
“Governments first took one step back but then two forward, all in the face of blocking tactics from industrialized countries like the
Several important shortcomings also still remain. The conference did not move forward enough toward answering the question of how the future legal framework will look nor was any time-table established for making this decision. There was also no outcome on additional sources of finance for climate projects or even a process for identifying them. Important loopholes under the Kyoto Protocol (such as leftover emissions rights – or “hot air” – and logging emissions) have not yet been resolved. However, in these talks, another positive development was the EU reasserting themselves as key players in these negotiations.
“We were pleased to see the EU contributing positively on important issues like the continuation of the Kyoto Protocol as well as their push on overall ambition level,” said Ulriikka Aarnio, CAN-Europe Senior Policy Officer. “However, they were not willing to help to close important loopholes, which are hollowing out their calls for more environmental integrity.“
Moving forward from
CAN-Europe now calls on EU decision makers to review and strengthen their positions in time for COP17 next December in
1.3. Finance and investment leaders, WWF, UNEP FI show unity on call for financing climate change action 6 Dec 2010
6 December 2010, WWF
There is an urgent need to scale up the levels of both public and private financing to halt the devastating effects of climate change and to enable the required shifts to low-carbon economies in developing countries, international organisations warned today.
Leaders from the finance industry, the UNEP Finance Initiative and WWF joined forces today to call for scaled up public finance and building up the financial mechanism under the UNFCCC to leverage much greater amounts of private finance to meet climate change mitigation goals.
The united call comes as negotiators from almost 200 nations are meeting in Cancun as part of the UN’s Framework Convention on Climate Change.
Last month 259 global investors representing USD15 trillion in investments issued a statement on climate change urging international action.
At a joint event  today in Cancun the organisations presented a shared vision for financing action on climate change. This vision includes the following:
· In developing countries both private and public financing needs to be scaled up: in a climate change mitigation context, international public financing is particularly needed to leverage private finance through de-risking instruments such as guarantees, first loss equity vehicles and hedging instruments; secondly, public finance is needed to build developing country capacity and create the policy frameworks needed to accelerate private sector shifts to the low carbon economy.
· Scaled up public finance is essential, but on its own not sufficient, to enable shifts to low-carbon economies in developing countries. As well, action will be needed to accelerate readiness, capacity and create the policy and regulatory conditions in developing countries
· There is considerable experience with public finance mechanisms to mobilize and channel private finance into the green economy and low carbon development.
· In the tight current budgetary situation of many countries not all of the public finance will be able to be sourced from domestic budgets. Innovative sources of public finance are needed to reach the scale of resources required.
Yolanda Kakabadse, President of WWF International, said:
"The negotiations are at a crucial stage with ministers arriving to support negotiators and sort through the different options on the table. It is essential that negotiators move decisively to strengthen the financial mechanism of the UNFCCC, and establish a robust process under the AWG LCA negotiating body to identify innovative sources of scaled up public finance.
"One area where progress can be made on both mitigation and finance is by addressing emissions from the maritime and aviation industries. The time is right to break the deadlock on this crucial area and move towards implementation.
“Public funds are critical to speed up the development of new technologies, as well as for adaptation, resilience building, and preparedness and capacity building measures. Public funds are also critical in leveraging private sector finance, which needs to contribute the great majority of the investments needed in clean energy technologies. Our experience is that public investment and initiatives play key roles in leveraging and directing private investment."
Mark Fulton, Co-chair of the UNEP Finance Initiative Climate Change Working Group and global head of Climate Change Investment Research at Deutsche Bank Asset Management said:
“Private finance for low-carbon endeavors in developing countries can and will only flow at the needed scale, if firstly, the risk-return profile of such investments is competitive with that of conventional investments and, secondly, if domestic policy frameworks on the ground display transparency, longevity and certainty. Public finance from international sources will be needed to manage risks for investors and create the capacity in developing countries to attract and channel private finance into the green, low carbon economy.”
1.4. Climate talks end with modest steps, no
12 december 2010, Reuters
The world’s governments agreed on Saturday to modest steps to combat climate change and to give more money to poor countries, but they put off until next year tough decisions on cutting greenhouse gas emissions.
The deal includes a Green Climate Fund that would give $100 billion a year in aid to poor nations by 2020, measures to protect tropical forests and ways to share clean energy technologies.
Ending a marathon session of talks in the Mexican beach resort of
But there was no major progress on how to extend the Kyoto Protocol, which obliges almost 40 rich nations to cut greenhouse gas emissions.
The failure to resolve the central problem of emissions dismayed environmental groups. It was also unclear how the $100 billion a year for the Green Climate Fund will be raised.
The first round of
The main success in
Major players were relieved there was no repeat of the acrimonious failure seen at the
"The most important thing is that the multilateral process has received a shot in the arm, it had reached an historic low. It will fight another day," Indian Environment Minister Jairam Ramesh told Reuters. "It could yet fail."
"We have a long, challenging journey ahead of us. Whether it’s doable in a short period of time, to get a legally binding deal, I don’t know," the European Union’s climate commissioner Connie Hedegaard said of a deal beyond 2012.
U.S. President Barack Obama, whose domestic plans to legislate cuts in greenhouse emissions have stalled, said the
Carbon offset markets worth $20 billion depend on
The Cancun agreement would "build upon" such markets, giving them some support despite the doubt over
Abyd Karmali, global head of carbon markets for the Bank of America Merrill Lynch said the deal lays the foundation for progress.
But experts said that current pledges for curbs in greenhouse gas emissions were too weak for the 2 Celsius goal.
Existing government policies will lead to a rise in world temperatures of about 3.6 degrees Celsius above pre-industrial times, according to Niklas Hoehne, director of energy and climate policy at consultancy Ecofys.
The agreement reached on Saturday set no firm deadlines for an elusive legally binding accord to succeed
China‘s top climate negotiator, Xie Zhenhua, said the agreement shows the Kyoto Protocol is still alive.
Earlier this week,
Developing nations insist that rich
Environmentalists worry that global leaders are not moving fast enough to tackle the big climate issues.
Britain‘s energy and climate secretary, Chris Huhne, said the advances in
"I think it definitely makes an agreement on 30 percent in the EU more likely," he said.
Bolivia‘s left-wing government was alone in objecting to the
Under the U.N.-led negotiations, all agreements are supposed to have consensus support, but
1.5. Mexican president hails climate deal at
11 December 2010, News Xinhuanet
Mexican President Felipe Calderon on Saturday praised the attendees of the UN climate change conference for finally reaching a deal to fight global warming.
"In doing so we are thinking of our brothers in the most vulnerable states," Calderon said. "But no one has renounced the goal of binding treaties.
Bolivia remains opposed to the two documents of the deal, saying that they amounted to a blank check for developed nations and the commitments set to be in documents which have not yet been published.
Most nations, including some of those most vulnerable to climate change, expressed support for the draft documents, although there were several nations that expressed reservations about the final accord.
The two-week-long talks in the Mexican resort of
The high profile discussions included some 25,000 government officials, businessmen, researchers and lobbyists – from more than 190 countries.
2.1. EU shifts energy policy focus to consumers’ bills
7 December 2010, EurActiv
European consumers should be able to switch to the cheapest energy supplier more easily, EU energy ministers said at a meeting last Friday (3 December).
Conclusions adopted by an Energy Council last week commit EU member states to put into practice provisions laid down in the Third Energy Package, agreed in 2009.
Under the package, consumers were meant to be able to obtain information on their energy consumption and rights, enforced by an energy ombudsman.
As part of their Energy Efficiency Action Plans, member states are also supposed to introduce new technologies like smart meters for use by consumers.
Last week’s Council conclusions speak of "providing correct, transparent and user-friendly information so as to change the behaviour of consumers towards energy savings," which are made most effectively with lower energy consumption.
The idea is that by having access to consumption-monitoring devices and simpler bills, consumers will be more aware of their energy expenditure and can change supplier if they want to.
The conclusions highlight the "urgent need" for consumers to compare prices and be able to switch energy suppliers easily, with "special attention" placed on consumers’ bills.
A European Commission study found last month that EU consumers could save around €13 billion or €100 per household each year if they were to shop around for energy prices and switch to the cheapest tariff available to them. However, less than one in three consumers actually bother to do so.
Liberalisation of the electricity market will therefore not be as beneficial to consumers as it could be, the study concluded.
Consumers must be "properly trained and educated," according to the energy ministers, who underlined that "the energy bill is one of the most important means of information to the consumer".
In September, the Commission agreed to come up with a definition of energy poverty in a bid to put consumers on the bloc’s energy policy agenda.
Over 50 million Europeans are estimated to be unable to pay their energy bills and maintain comfortable living standards.
However, it will be up to member states to set out what can be defined as energy poverty, the ministers said, meaning citizens’ rights could be better protected in some member states than others. The Commission will then analyse how member states came up with their definitions.
An EU energy ombudsman
Ways of settling consumer disputes related to energy currently vary amongst member states.
To fill these gaps, ministers proposed to establish an EU-wide "independent mechanism" to handle disputes in order to secure "efficient and effective treatment" of out-of-court settlements.
The mechanism could adhere to the model for treating complaints used by the existing European Energy Ombudsman Group, which is made up of ten consumer rights groups and energy companies.
Monique Goyens, director-general of BEUC, the European Consumers’ Organisation, called for the Energy Council meeting to be followed up by action.
"Adopting consumer-friendly conclusions is one thing – now words must lead to action. Every one of us wants to reduce our consumption and energy bills, but we often lack the knowledge and tools to do so," Goyens said in a statement.
"Getting rid of incorrect and incomprehensible bills would be a first step in the right direction," she said.
"Governments’ homework is quite simple. Unless existing rules on transparency, supplier switching, consumer protection and complaint handling are properly implemented, consumer rights amount only to hot air," she warned.
2.2. Nabucco in ‘David vs. Goliath’ battle for Azeri gas
10 December 2010, EurActiv
Pressure is growing on the Nabucco consortium to reveal its hand over its tender for Azeri gas. The winner, to be announced in April, will be master of Europe’s Southern Gas Corridor, designed to bring gas from sources other than
Azerbaijan, a key potential supplier country for the Nabucco project, heaped pressure on the pipeline consortium to reveal its intentions and recognise its alleged weaknesses.
Elshad Nasirov, the country’s top negotiator for a tender to access ten billion cubic metres (bcm) of Azeri gas from the Shah Deniz II field, said that two Nabucco competitors, namely the Turkey-Greece-Italy Interconnector (ITGI) and the Trans-Adriatic Pipeline (TAP), could "turn out to be more attractive".
"We are not going to pay for the empty capacity of Nabucco," said Nasirov in a much-noticed interview, published by the European Energy Review.
Nasirov was referring to the fact that Nabucco has a designed capacity of 31 bcm, while for the time being, no gas is available to fill the pipeline – except for the 10 bcm at Shah Deniz.
"We do not promise additional gas. Everything depends on the price," Nasirov said, adding that
"We tell Nabucco: quote your tariff’," Nasirov said, adding that he was waiting for "a serious proposal from Nabucco" in order to compare it with other proposals. But he made plain that in his view, Nabucco was "still uncertain" without a second source of gas.
A similar message came on Wednesday (8 December) from Umberto Quadrino, CEO of Edison, the Italian energy company promoting ITGI.
"Nabucco doesn’t justify investment for a pipeline with a capacity of 30 bcm," he said.
Oettinger to act as referee?
Quadrino was speaking at a European Parliament dinner hosted by Greek and Italian MEPs in the presence of EU Energy Commissioner Günther Oettinger. There, he pleaded for "collaboration" between ITGI and Nabucco, saying that Oettinger could convince the Nabucco consortium to adopt a two-step approach to building the Southern Gas Corridor.
The first step would be taken by building ITGI, with Nabucco coming only at a later stage, when gas from new sources becomes available, he said.
Quadrino suggested that contact had already been established between ITGI and Nabucco to discuss such a scenario.
But a Nabucco spokesperson denied that any contact had been made. "I cannot talk for our shareholders but our project company," said Cristian Dolezal, speaking to EurActiv from
For Dolezal, the two-step approach promoted by the ITGI partners is incomprehensible to his company. Nabucco, he said, is the only project in the Southern Gas Corridor that provides a new highway from
"ITGI would lead to
ITGI’s promoters insisted that
Experts present at the Parliament dinner told EurActiv that only Nabucco actually provided for new pipes to be laid across
US Ambassador Richard Morningstar, secretary of state and special envoy for Eurasian energy, said the Nabucco pipeline project is "a good, but not the only project," Russian daily Kommersant reported.
"We support not only Nabucco, but also the entire South Energy Corridor – a series of pipelines that will be required to deliver Caucasian and Central Asian gas to Europe via
Morningstar said EU companies must make a commercial decision about which project is the most reasonable and beneficial.
"We would have preferred Nabucco, but that does not mean it will be implemented first," he said.
3.1. Cancún close to funding deal on CO2 storage
10 December 2010, EurActiv
Delegates in Cancún are braced for a final vote to approve the funding of controversial carbon capture and storage (CCS) technology under the UN’s Clean Development Mechanism (CDM).
The issue of CCS has been on the table since the COP-10 meeting in 2005 but decisions were always postponed.
This time, instead of the question being framed in a ‘yes’ or ‘no’ format, two options that both enable funding for the experimental technology have been approved by the Kyoto Protocol’s scientific advisory board, the Subsidiary Body for Scientific and Technological Advice (SBSTA).
Under the first option, CCS would be funded if concerns about carbon leakage from underground geological formations, environmental risk, legal liabilities and monitoring are "addressed". This would take place in discussions at the next SBSTA meeting with input from parties, observers and technical experts.
Under the second option, CCS would be deemed ineligible for funding until and unless such issues are "resolved in a satisfactory manner" by Kyoto Protocol signatories. In practice, observers expect robust pressure would ensure that such resolutions were achieved, albeit with potentially greater safeguards and conditions attached.
Final approval of the CCS proposals today (10 December) will depend on the shape of a broader deal that is currently being thrashed out at the summit.
CCS is ‘one bit of the mosaic’
Artur Runge-Metzger, the EU’s chief climate negotiator, told EurActiv from Cancún that CCS was being hotly debated. "We are at the stage of looking at the entire package and this is one bit of the mosaic," he said.
"The EU legislation is there to allow for CCS. We think it is an important element and in
Negotiators have already moved the issue up the agenda. An original draft recommendation from SBSTA, obtained by EurActiv, had contained an option declaring CCS technology ineligible for credits in the world’s carbon market.
But EurActiv understands that following pressure from OPEC states, particularly
The economic viability of CCS has been repeatedly questioned, unless great subsidies are pumped in.
One recent report commissioned by EU Energy Commissioner Günther Oettinger, "EU Energy Trends to 2030", suggested that the carbon price in Europe between now and 2030 was likely to remain too low for the current CCS subsidies offered by European governments to make the technology viable.
And a 2009 study by Landesbank Baden-Württemberg similarly concluded that CCS was "not practicable on commercial and economic grounds".
But the technology’s potential to reduce emissions is not in doubt.
The Intergovernmental Panel on Climate Change’s report into CCS found that it could reduce carbon dioxide emissions from power plants by up to 80-90%. By 2050, some 20-40% of all global fossil fuel emissions could technically be suitable for capture, it said.
But CCS remains stubbornly unpopular with environmentalists who warn that this time frame would be too late to stop runaway global warming, and renewable energy is anyway a much wiser investment.
They charge that energy firms like BP and Shell International support CCS because one of its byproducts – liquefied carbon – could theoretically be pumped into depleted oil fields to allow the easy extraction of remaining reserves.
In July 2008, Shell International’s then-climate adviser, David Hone, was one of the first business voices to propose bringing CCS into the CDM. On 8 December, he was appointed the new Chair of the Board of the International Emissions Trading Association, which works in partnership with the World Bank to develop a global greenhouse gas market.
Opposition to CCS still rife
Opposition to CCS from countries such as
However, Bas Eickhout, a Dutch Green MEP currently in Cancún, doubted that it would have much effect. "Given the way that these discussions have been done, it’s clear that people will go along with [CCS] as a compromise in order to keep
He predicted that delegates would finally support the SBSTA option two.
Chris Davies, a UK Liberal Democrat MEP who led the debate on CCS funding in the European Parliament, welcomed the possibility of making funding available for the technology under the CDM mechanism. "Without the use of CCS it will be impossible to curb the emission into the atmosphere of vast quantities of CO2 from fossil fuel power plants and major industrial installations," he said.
"Its inclusion in the Clean Development Mechanism will give a huge boost to development of the technology." However, he admitted that the technology is expensive and said "many countries will be concerned that it could lead to a significant diversion of CDM funds to their disadvantage".
Less enthusiastic was Bas Eickhout, a Dutch Green MEP currently in Cancún, who described it as an "indirect subsidy" to the fossil fuel industry.
"It’s a very bad idea," he said. "The environmental effectiveness is not there at all. This [funding] will just go to the big companies. It shows that there are countries that want to continue business as usual. There’s a danger that the CDM itself will be finished by this, that it will be misused more often, that criticisms will increase, and in the end we will be left without any CDMs."
Manuel Graf from green NGO Friends of the Earth said: "This is not just a question of technology. CCS is expensive and there are many problems attached to it. We’re shifting the developed world’s responsibility to cut emissions to the developed world and subsidising fossil fuel industries with money that could have been used for renewables and small-scale efficiency programmes."
"There is also a big liability issue. You can get CDM credits for up to 21 years but these projects need to last for more than a thousand years. Who is taking the liability if something goes wrong with a CCS installation and the CO2 comes out of the ground again? It looks as though the liability is being handed over to the developing world."
3.2. Poland signs deal to sell Japan 4 million AAU emissions credits
10 December 2010, Platts
Poland has signed an agreement with Japan to sell it 4 million of its Kyoto surplus greenhouse gas emission credits, the Environment Ministry said late Thursday.
The agreement was signed with Japanese government agency NEDO in Cancun, Mexico, during the UN Climate Conference, the ministry said.
The ministry did not give a value for the deal, although it has said previously it would be worth more than Eur13 million ($17.22 million).
"We’re still holding discussions with partners to buy our green emmission credits because, thanks to them, we’re directing a large stream of funds to environmentally friendly investments and the permits are supporting the modernization of our power system," Polish Environment Minister Andrzej Kraszewski said.
It is the fifth such deal Poland has sealed. The four previous transactions with Ireland, Spain and two private Japanese companies, earned the country more than Eur80 million. The funds are being used to improve the energy efficiency of public buildings, modernize the country’s power network and supporting biogas and biomass projects.
Kraszewski has said he wants to sell as much of the country’s surplus of 500 million mt of Kyoto Protocol Assigned Amount Units, which cover the six greenhouse gases that Kyoto regulates and are granted to countries which have ratified the Kyoto Protocol, by 2012. The quota is worth an estimated Eur4 billion.
Poland has the third largest surplus of AAUs in the world after Russia and Ukraine. The amount each country holds is determined by its Kyoto emissions reduction target for 2008-12 against its 1990 baseline. Poland has a surplus because of the economic restructuring the country undertook following the collapse of communism in 1989 which caused the shutdown of many polluting factories. Poland has reduced its greenhouse gas emissions by 30% since 1988.
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