1.1. Climate discussion postponed as economic issues and Greece dominate summit
14 February 2010, Sandbag
The informal meeting of EU Heads of State held last week failed to cover all the topics set out in the agenda and was instead dominated by a discussion about economic governance and the current economic crisis in Greece.
The summit had been scheduled as an opportunity to discuss the EU’s economic policy more widely, consider climate policy post Copenhagen and also aid efforts in Haiti. A short statement was issued offering solidarity towards Greece and in a press conference after the meeting Spanish President Jose Luis Zapatero described discussions about the need for enhanced economic governance and a strategy for generating growth and job creation to 2020. Protecting and enhancing the Eurozone’s competitiveness was clearly a dominant issue.
This is not surprising as some reports this week indicated that after a very brief period out of recession the EU economy could be headed back into negative growth. A key question in this debate is where the EU considers future growth will come from? Will it stem from a return to growth in the heavy industries, manufacturing and retail firms that have been hit in the recent recession or from newer sources of wealth based on innovation, intellectual property and service provision? This will determine the EU’s approach to many policies that will need to be decided in the coming months not least the future position the EU takes in international climate negotiations.
President Zapatero hinted that the EU’s economic strategy may be more comprehensive than simply protecting the status quo when he added: "I not only refer to economic government concerning the EU-27, but the world economy and the positions that the EU should take in decisive matters for the future, such as regulation of the financial system, regulation of raw materials and climate change”. The name check for climate change is welcome but equivocal. Defenders of our high emitting companies and practices will interpret this as meaning we cannot go further without the rest of the world joining in for fear of damaging our competitiveness. Proponents of clean and innovative technologies and services will be hoping the EU sees that its future security lies in being a dominant player in the post-carbon economy and that growth will be achieved through massive investment in new energy infrastructure. Significantly both the US and China have indicated that they intend to invest in low carbon energy irrespective of what the rest of the world does. The extent to which the US is allowed to do this by its own internal politics will be a decisive factor in future negotiations.
This debate, due to take place during Thursday’s meeting, was in the end postponed. When it does happen it is likely to be heated as countries have already aligned themselves on both sides of the argument with the UK, France, Holland and Denmark supporting the case for stronger targets leading to higher innovation and investment in future technologies. While Poland and Italy are dominant in taking the opposing view.
The Environment Council on March 15th may be the next opportunity for this discussion to be aired but anything decisive may be held over until the Spring Summit on March 25th-26th. If the EU wants to play a role in getting the world’s emissions on to a declining pathway it has to make its mind up on which target it will adopt before the next Ministerial negotiation which is likely to be in Bonn this June. Spring Council is therefore the last chance. It would be short sighted to miss this opportunity, whatever the short term economic circumstances are at the time. Some issues are too important to postpone.
1.2. G20, U.N. vote reform could help climate deal
12 February 2010, Reuters
Climate talks by the Group of 20 and a suggested shift to majority voting for U.N. decisions could revive work on a new pact to fight global warming after the low-ambition Copenhagen summit, analysts say.
The U.N. Climate Change Secretariat has asked all nations for views by February 16 about how many U.N. meetings are needed in 2010 to try to build momentum for the next annual ministerial talks, in Mexico from November 29 to December 10.
Countries are unclear what to do after Copenhagen fell short of a binding treaty urged by most nations and left the 2010 calendar almost bare. The only other planned U.N. meeting before Mexico is of bureaucrats, in Bonn from May 31-June 11.
"So far there hasn’t yet been the engagement of a smaller group of countries to lead the way," said Jennifer Morgan, director of the World Resources Institute’s climate and energy program.
Analysts said the G20, with summits in Canada in June and South Korea in November, might be able to help by focusing more on climate change. Calls for a relaxation of a need for unanimity on key U.N. decisions could ease work on a new deal.
"We need to work on the U.N. process — item one is to allow for majority decisions," said Johan Rockstrom, head of the Stockholm Resilience Center at Stockholm University.
All agree that the 194-nation U.N. talks are unwieldy so smaller groups are needed along the way. But Copenhagen showed that developing nations — including those most vulnerable to desertification, rising sea levels or floods — felt left out.
This year, U.S. President Barack Obama might want to defer to the G20 rather than push the U.S.-led Major Economies Forum (MEF) of 17 top emitters, which met six times in 2010. The G20 adds Argentina, Saudi Arabia and Turkey to MEF members.
"The United States will be very careful not to set up something that looks like a rival process to the U.N.," said Alden Meyer, of the Union of Concerned Scientists, adding that the G20 was a more likely venue than the MEF for climate talks.
Washington is an outsider among rich nations by staying out of the U.N.’s existing Kyoto Protocol for cutting emissions by 2012. And carbon capping legislation is stalled in the Senate.
U.S. , CHINA
Robert Stavins, director of the Harvard Environmental Economics Program, also said Washington might be more willing to favor the G20 than the MEF. The MEF might meet if other countries, perhaps the European Union, asked for talks.
December’s Copenhagen summit disappointed many nations with a deal led by major emitters such as China and the United States to limit global warming to below 2 degrees Celsius (3.6 F), twinned with a promise of $100 billion in annual aid from 2020.
Stavins said that finding a path to a more robust deal was a "tremendous challenge."
"It’s also a game of chicken between the United States and China: China is not going to take action before the U.S. does. The U.S. Congress is very reticent to take action unless China does," he said.
Mexican President Felipe Calderon has urged a review of the principle of unanimity to streamline decisions.
The Copenhagen Accord, the main outcome of the summit, was merely "noted" rather than "adopted" as a U.N. plan after opposition from Sudan, Cuba, Nicaragua, Venezuela and Bolivia.
Navroz Dubash of the Center for Policy Research in New Delhi noted that China, India, South Africa and Brazil wanted extra U.N. meetings this year, sending "a pretty strong signal that they don’t want the U.N. to be marginalized."
"On the other hand others, such as the U.S. and Australia, are actively seeking other venues," he said.
Kim Carstensen of the WWF environmental group and WRI’s Morgan said a priority should be aid to help developing nations cope with climate change. Rich nations have promised about $10 billion a year from 2010-12.
"What’s going to be really important for me is that we move on finance. I think that should be possible. I think the way that would happen would be a mix of different meetings," Carstensen said. "It’s tempting to hit on the U.N. and its inability to deal with (climate change)," Rockstrom said. "My personal take on this is that the U.N. is the only one which can take us to a global agreement."
"We’ve done it before under the Montreal Protocol," he said, referring to the 1987 pact for protecting the ozone layer.
1.3. EU’s Ashton to engage China on climate change
11 February 2010, Reuters
The European Union’s new foreign policy chief wants the EU to work more closely with China on climate issues and search for trade-offs with other policy areas, an EU official said on Thursday.
Catherine Ashton will brief a summit of EU leaders on Thursday about her policy vision in areas such as climate, trade and security.
"She won’t be saying that we’re flexible on everything, but she doesn’t want climate change to be seen as an isolated issue," the official said on condition of anonymity.
Most EU leaders were disappointed by the outcome of United Nations climate talks in Copenhagen in December, which failed to set emissions reduction targets.
Some pointed the finger at China, the world’s largest climate polluter, for missing an opportunity to break the deadlock.
"She’ll say let’s not fall into the trap of bashing China — what is much more interesting now is to look much more strategically at how we can deal with China on those issues, look at what they want … what is the room for manoeuvre."
An example of something China wants from Europe is "market economy status", which would help in trade talks.
"One thing that springs to mind is that the Chinese are important partners on issues like Iran and other issues," he added.
The Copenhagen talks ended with a weak accord, which puts the world on track for global temperature rises to around 3.5 degrees Celsius above pre-industrial levels, climatologists say.
Further U.N. discussions are planned for Bonn, Germany in May and for Mexico in November.
But recent setbacks to climate policy in the world’s second-largest emitter, the United States, make international climate progress increasingly difficult. EU negotiators say they will make the most of 2010 by pushing bilateral talks.
Ashton also wants to propose a more coherent approach to other big economies such as Brazil, India and South Africa on issues including climate, the official said. "Nobody has defined how we can build something that leads to results with countries like Brazil and South Africa," he said.
2.1. Recharging fuel efficiency standards
4 February 2010, T&E
Visitors to the Brussels motor show last month could have been left with only one impression: the future is electric. As your special report on the future of cars noted (14-20 January), virtually every manufacturer exhibited a car powered by batteries.
It is just as clear that electric cars are the talk of the town in Brussels’s political quarter. In September, European Commission President José Manuel Barroso declared that “the development of clean and electric cars” would a key priority in the next five years. On 20 January, Spain’s Prime Minister José Luis Rodríguez Zapatero echoed that vision in a presentation of his country’s EU presidency plans (“Zapatero sets out economic vision”, EuropeanVoice.com, 20 January). And electric cars will be a central point of discussion at the informal Competitiveness Council in San Sebastián on 9 February.
The interest in electric cars is readily understandable. A truly sustainable transport system is difficult to imagine without a shift away from oil towards more sustainable sources of energy. Since current biofuels policies are creating more problems than they solve, the electrification of transport does currently seem to be the technological pathway most likely to deliver the deepest carbon cuts.
But EU policymakers should avoid a strategy that focuses exclusively on promoting and/or subsidising electric cars.
It is all very well having a vision, but, as the former German chancellor Helmut Schmidt said, “people who have a vision should go see a doctor”. A vision for electric cars has failed before, in California in the late 1990s. The popular 2006 film, “Who killed the electric car?” identified the villains as oil companies, poor-quality batteries, car manufacturers and customers. But the film-maker let the real murderer get away undetected: California’s failure was to let conventional cars stand still while trying to force the market to adopt a single, expensive new technology.
Although a number of the world’s biggest companies (including Toyota, GM and Ford) launched decent products, they simply could not compete on price with petrol equivalents. If petrol cars had been forced to offer fuel efficiency equivalent to that of electric cars, they would have been left for dust.
The EU will be able to level the playing-field for electric cars – and move the entire market towards low-carbon technology – only if all producers are forced to make all new cars more fuel-efficient.
The EU should start by revising the current law on emissions by new cars. This enables carmakers to sell three gas-guzzlers for every electric vehicle they sell; in other words, the more electric cars they sell, the less carmakers have to do to improve the rest of the fleet. Overall emissions will go up. Super-credits should be scrapped – and certainly not extended to vans, as the Commission has proposed.
The EU should also introduce a consistent, long-term series of evolving targets for fuel efficiency: 80g/km CO2 for 2020 and 65g/km CO2 for 2025 would be a great start.
Carmakers would no doubt cry foul; they always do. But despite their repeated claims that the EU has been far too tough by imposing a target to improve efficiency by 17% over seven years, carmakers have already shown that they can do much more than that. The 2009 Volkswagen Golf BlueMotion is 27% more efficient than its 2007 predecessor.
Carmakers always prefer carrots over sticks. And governments, despite being desperately short of cash, seem to be willing to open their cheque books for electric cars (the Boston Consulting Group calculates that governments worldwide are offering up to €10 billion in the next five years in tax incentives, levies, subsidies and consumer bonuses to encourage the development of electric cars).
But they should remember that it was the EU stick of CO2 standards that forced carmakers to start using fuel-saving technologies such as those found on the new 99g/km CO2 Golf.
That same stick started all the buzz about electric cars, and will be the key to ensuring their success. If policymakers really want electric cars to power ahead, they should start by recharging fuel-efficiency standards for the whole fleet.
2.2. Commission withholding key research on environmental impacts of biofuels
12 February 2010, T&E
The European Commission is refusing to release scientific research on EU biofuel policies, frustrating efforts to bring to light the environmental damage that would result from current biofuel policies. The research is likely to confirm the findings of numerous scientific studies that show several types of biofuels cause more emissions than conventional fossil fuels (1).
The Renewable Energy Directive, agreed to as part of a wider package of EU climate legislation in late 2008, requires Member States to use renewable sources to meet 10% of their transport needs by 2020. This target is expected to be met, in large part, by biofuels. It was assumed that such renewables use would reduce greenhouse-gas emissions, although early science indicated significant indirect impacts of biofuel production on land use and emissions. Concerns over these impacts compelled the European Parliament and the Council to require the Commission to analyse and act on the issue. The scientific research being withheld is the result of this analysis.
A well-known consequence of biofuel production is that it will result in the conversion of forests into cropland as land under cultivation expands to make up for production shifted from the food to the energy market— known as indirect land-use change (ILUC). The consequences of ILUC can be the most important factor in assessing a biofuel’s environmental impact. The result could be biofuels sold in Europe that actually create more greenhouse gas emissions over their production lifecycle than conventional sources of petrol and diesel.
Environmental groups BirdLife International and Transport & Environment, and the environmental law organisation ClientEarth, are demanding the immediate release of studies ordered by the Commission. One study, carried out for the Commission’s Directorate General for Agriculture, was completed as far back as July 2009, yet it is being withheld.
The Commission must disclose the information to the public under the EU’s access to documents legislation. The original request was submitted on 15 October 2009 – 120 days ago. In a letter sent this week, dated 8 February 2010, the Commission informed the coalition that it would not meet the statutory time-limit to disclose the documents .
The Commission’s reluctance to put scientific information in the public domain is particularly worrying against the backdrop of other recent developments. Last week leaked guidance on biofuels prepared by the Commission for Member States said environmentally destructive palm oil plantations should be reclassified as forests therefore avoiding a breach of sustainability criteria. (2)
Nusa Urbancic of Transport & Environment said: “The Commission already ignored the scientific evidence that most biofuels cause more harm than good when it came up with the latest biofuels targets, and it is now withholding its own research into the issue. But that approach is already leading to widespread environmental damage and will create far more problems in the future. The EU must revise its policy on biofuels to ensure that only those that bring benefits are supported by European policy. “
Tim Grabiel of ClientEarth said: “This is a violation of bedrock European law on access to information, and a slap in the face to meaningful public participation in environmental decision-making. That the Commission would violate the public’s right to access critical scientific research that discloses the true impacts of its biofuel policies is revealing. Where there is smoke, there is fire. We are reviewing the merits of these violations and will take the necessary steps to ensure that this information is made available.”
Ariel Brunner from BirdLife International said: ”The story of EU biofuels policy is one of wishful thinking and policy-based evidence. It is time for evidence-based policy.”
2.3. EU must commit to green electric cars
8 February 2010, T&E
Putting more electric cars on the road could increase carbon emissions unless they run on green energy, says a new independent report commissioned jointly by Friends of the Earth Europe, Greenpeace and Transport & Environment. The environmental organisations call for national renewable electricity targets to ensure electric vehicles are truly ‘zero emissions’.
The report, written by consultancy CE Delft, comes as European industry ministers are expected to announce an EU action plan for electric cars at their informal meeting in San Sebastián, Spain, on 9 February.
The study warns that existing EU legislation on car emissions is flawed because it allows manufacturers to use sales of electric vehicles to offset the continued production of gas-guzzling cars. So-called ‘super credits’ allow carmakers to sell 3.5 high-emitting cars for every electric car sold, without affecting their overall CO2 target. According to the report, increasing sales of electric cars to 10% of the total could lead to a 20% increase in both oil consumption and CO2 emissions in the EU car sector.
Environmental organisations call for super credits to be axed in current and future CO2 laws – starting with proposed EU legislation to regulate emissions from vans. The organisations also call for all electric cars sold on the EU market to be equipped with so-called smart-metering technology that allows vehicles to only be charged when surplus electricity – mostly from renewables like wind and solar – is available on the power grid. To make this possible, the EU will also need to boost the supply of renewable electricity.
Sonja Meister from Friends of the Earth Europe said: "While electric cars can be part of the shift to a more sustainable transport model, they must be coupled with a commitment to ensure they run on renewable electricity. Efforts must also be made to reduce overall travel demand – if people continue to drive as much as they want in electric cars regardless of whether they are powered in a sustainable way it will result in more harmful emissions than today."
Greenpeace EU transport policy advisor Franziska Achterberg said: “We need smart electric vehicles that interact with smart electricity grids so cars can charge up on green power. Dumb electric vehicles plugged into a dumb electricity grid would only add demand for coal and nuclear power and drive us away from a sustainable energy future.”
Nusa Urbancic of Transport & Environment said: "Just as every car sold today has to have an odometer to show how far it has driven, every electric car needs a smart meter to show how much electricity has been used and better still, whether or not that electricity came from a renewable source. Just plugging thousands of electric cars in like kettles would leave consumers and electricity suppliers in confusion and chaos. It’s up to the EU to ensure that all new cars sold in Europe are fitted with this kind of technology.”
2.4. European Commission plans to sacrifice forests for biofuels
3 February 2010, FOEE
Friends of the Earth dismayed by attempts to call palm plantations ‘forests’
Brussels , February 3 – A leaked document from the European Commission reveals plans to allow the controversial use of palm oil as a biofuel by redefining palm plantations as ‘forests’. The expansion of palm plantations is a major cause of tropical rainforest destruction.
The draft Commission guidance for EU countries also states that cutting down a rainforest and planting a palm plantation would be possible under EU laws aimed at stopping ‘unsustainable’ biofuels.
Adrian Bebb, agrofuels campaign coordinator for Friends of the Earth Europe said: “This leaked document shows the disgraceful attempts to push palm oil through European laws designed to prevent destruction of the world’s forests. Allowing the expansion of palm plantations to fuel cars and lorries in Europe will have a devastating impact on the climate, biodiversity and the people who depend on forests.
“If the incoming Commission is serious about tackling climate change and halting biodiversity loss it needs to clean up the biofuels legacy and urgently ensure that forests are not sacrificed to fuel cars.”
According to the UN the rapid increase in palm oil plantation acreage is now the primary cause of permanent rainforest loss in Malaysia and Indonesia.
Although European lawmakers hope to use biofuels to reduce climate-damaging emissions, the impact of expanding agriculture to grow biofuel crops is now accepted as increasing emissions. Converting rainforest to palm oil plantations, for example, would create a ‘carbon debt’ and it would take 86 years of palm oil biofuel use to repay the emissions released through the deforestation.
More at: http://www.foeeurope.org/press/2010/Feb03_EC_plans_to_sacrifice_forests_for_biofuels.html
3.1. China’s venturing into a carbon market 10/02/10
11 February 2010, Sandbag
News in the Financial Times of the Tianjin Climate Exchange preparing to launch China’s first domestic carbon market is further evidence for the growing support for carbon markets as a tool in preventing dangerous green house gas emissions entering the atmosphere.
The Tianjun Climate Exchange is a joint venture between the Chicago Climate Exchange, the municipal government of Tianjin, and PetroChina. The system will set an emissions cap for participating instillations, with those exceeding their allowance having to buy additional allowances from other companies who have emitted less than their allocation. With no clear legal or policy framework set out by Beijing, any such scheme would be on a purely voluntary basis. It is rumoured that such a cap and trade system could be in place in as little as six to twelve months.
This move signals a shift in the global strategy to address emissions targets. No longer are carbon markets the preserve of developed nations; the political will and momentum behind markets seems to have gathered pace. Where the controversy behind the benefits of carbon markets seems ever present in Europe, developing countries are taking steps to implement their own version of systems that would help them reduce emissions.
Many questions remain regarding what a Chinese carbon market might look like. Would they be able to draw from lessons learnt by the UK during its voluntary emissions trading scheme or will they look to the EU’s emission trading system? As a starting point those at Tianjin Climate Exchange might get some good pointers from Sandbag’s recent report on lessons learned from the EU emissions trading system. The important issue is whether this could lead the the way for a national voluntary carbon market, or even a compliance market. The development of a domestic Chinese carbon market could provide the well-needed boost the carbon market needs.
3.2. ANALYSIS – Tokyo CO2 credit trading plan may become a model
11 February 2010, Reuters
A plan to cut carbon dioxide emissions in the heart of Tokyo, one of the world’s biggest and richest metropolitan areas, may prompt political action on a stalled national effort.
Tokyo city proper will set emission limits for 1,400 large factories and offices to meet by using technology like solar panels and advanced fuel-saving devices starting in April.
Beating the targets earns credits that can be sold locally to those that fall short. Tokyo, like California which sets its own CO2 policy, often leads national change and the programme will be closely watched.
"This is an epoch-making step. Each company for the first time will have to come up with a strategy to control its emissions and meet a target that is obligatory," said Naoyuki Yamagishi, climate change programme leader at WWF Japan.
Tokyo prefecture, home to 13 million people, is surrounded by a wealthy metropolitan economy nearly triple that size which ranks as one of the wealthiest and most densely populated areas in the world.
VOLUME CAP VS INTENSITY
Prime Minister Yukio Hatoyama has pledged to cut national greenhouse gas emissions by 25 percent by 2020 based on 1990 levels of 1.261 billion tonnes, deeper than a minus 6 percent goal over 2008-2012 under the Kyoto Protocol.
Japan has already made strong strides in energy efficiency and combined with an economic slowdown has seen emissions of CO2, the main greenhouse gas, fall 6.5 percent to 1.216 billion tonnes in the most recent fiscal year.
However, drafting of a climate bill Hatoyama aims to submit to parliament in March to cut emissions further to meet the 2020 goal has faced industry opposition on competition concerns and methodology.
"It would be tough to get things ready for the earliest possible start in April next year," Environment Minister Sakihito Ozawa said of an obligatory national carbon trading scheme in a recent interview, adding that he had not started negotiating with major industries.
But Ozawa said he hopes that the Tokyo cap-and-trade programme could make emitters realise the need to move forward on a national plan that sets emission volume caps like in the EU, a change that could help make Japan a leader in energy efficiency and manufacturing cleaner sources of energy.
Big emitters like power plants, none located in Tokyo, are likely to respond to volume caps by spending on cleaner energy projects rather than relying on solely conservation or buying carbon credits, according to analysts.
"A cap-and-trade would provide a rationale for company managers to invest in cleaner energy," said Masaki Mita, Japan representative of energy data service Argus Media Ltd.
Japanese power firms, which bind themselves to voluntary 2008-2012 goals, are among the biggest buyers of U.N. approved carbon credits because it is now cheaper to invest in emission cuts in developing countries than cut domestically.
Their current goals are also aimed to make their energy mix less reliant on fossil fuels. But such a carbon intensity goal is not effective enough to cut CO2 when clients demand more power.
Japan , the world’s third largest oil importer, saw consumption fall 6.9 percent to 193 million kilolitres last year, a trend in place since 2006.
Hatoyama’s ruling Democratic Party would indirectly cut reliance on oil imports further by boosting the share of renewable energy used to 10 percent of primary supply by 2020.
That would mean a shift away from fossil fuels of at least 4 percent of the total, or 22 million kilolitres of oil equivalent a year given current primary energy supply levels.
Tokyo ‘s effort to cut CO2 by 6 and 8 percent by any factory or office that uses 1,500 kilolitres of oil equivalent or more a year, respectively, in the next five years by contrast is a drop in the ocean at less than 500,000 kilolitres of oil equivalent.
Tokyo prefecture’s CO2 emissions account for only 5 percent of the total in Japan and the offices and factories targeted account for 1 only percent.
But if as planned the programme spreads wider nationally and evolves along with variants used elsewhere, it could be a new that thinking brings fresh ideas to global climate talks now stalled because of fierce debates over equity and scale, an academic said.
"It’s the first attempt ever in Asia and there’s a potential it will inspire cities and provinces in China," said Toru Morotomi, associate professor at Kyoto University’s Graduate School of Economics. ($1=89.31 Yen)
4.1. Green Power for Electric Cars
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