Montreal v. Kyoto. Scott Barrett Columbia University

Transcription

1 Montreal v. Kyoto Scott Barrett Columbia University

2 One World

3 Many Countries

4 Obligations Domestic v. International Title IV Kyoto Caps SO 2 by plant. Caps GHG by states. Trading Yes Yes Monitoring Precise Self-reporting Participation Mandatory Compliance Fine > $3,000/ton 2005 > price. Excess subtracted from next year. Non-compliance a felony Voluntary Article 18: procedures and mechanisms entailing binding consequences be adopted by means of an amendment.

5 A Study in Contrast OZONE CLIMATE Restricts emissions Cuts emissions All countries Industrialized countries Up to 100% Around 5% Duration Permanent Consequence Ozone layer restored 2050 Negligible Why the difference?

6 Two kinds of ozone Bad ozone is in the troposphere. Good ozone is in the stratosphere.

7 Another look

8

9 Change over time

10 The underlying PD $5 $1 Π P Π A $104 $100 0 N-1 Number of others that play Abate Card game: $5 if keep red card; $1 for every red card handed in by anyone. Suppose N = 100.

11 To be effective, a treaty must Deter non-participation. Enforce compliance. Do both of these things even while requiring that parties do much more than they would were they to act independently (unilaterally).

12 Montreal Protocol Negotiated in 1987; amended 4 times and adjusted 6 times since then. Bans production and consumption of the ODSs. Achieves universal participation. (197 parties, including the EU) By around , the ozone layer is expected to be restored. How and why did the MP succeed?

13 Cost-benefit analysis of the Montreal Protocol No Controls Montreal Protocol Unilateral Implementation of MP Ozone Depletion (%) By 2000 By 2050 By % 15.7% 50.0% 0.8% 1.9% 1.2% 0.9% 10.3% 49.0% Payoffs to the US (Billions of 1985 $US) Benefits Costs Net Benefits B-C Ratio $3,575 $21 $3, $1,373 $21 $1, Source: EPA (1988).

14 Implications Ozone depletion favored unilateral implementation of MP by at least some rich countries. Was MP a success? Or did it merely codify what states would have done anyway? Three major worries: (1) production would relocate (leakage); (2) poor countries would not cut back; (3) it would be harder to sustain bigger cuts, involving a wider range of ODSs. MP addressed all three worries.

15 Carrot Developing countries had common but differentiated responsibilities. Rich countries to pay incremental costs for developing country implementation.

16 Ratification of the Montreal Protocol London Amendment Transition Economies Number of Parties Article Industrial

17 Stick The credible threat of a trade restriction sustained full participation and deterred non-compliance.

18 Cooperation & trade restrictions Minimum participation level set to 11 countries making up at least 2/3s of global consumption IEA Game with Trade Sanctions Π n Π s Number of other signatories

19 The difference Montreal made

20 If the MP had not worked

21

22 Climate change

23 Framework Convention Aim should be to stabilize greenhouse gas concentrations in the atmosphere at a level that would prevent dangerous interference with the climate system. Reasonable? 195 parties, including the EU.

24 Kyoto Protocol

25 Kyoto Protocol Sets emission limits for Annex I countries only. Applies to CO 2, CH 4, N 2 O, HFCs, PFCs, SF 6. Allows trading. Clean development mechanism. Enters into force after being ratified by at least 55 countries making up at least 55% of Annex I CO 2 emissions.

26 Some problems No enforcement Non-participation of the U.S. Withdrawal by Canada. Trading may not reduce emissions ( hot air ). Emission limits based on production, not consumption. Leakage. Much too short term. Very modest; can it be made more ambitious? What is to follow?

27 Reasons for Kyoto s Failure The economics are not as favorable as for ozone.

28 Ozone v. Climate Protecting ozone layer 2 CO 2 stabilization Benefit Cost B-C ratio $2,775 $250 11:1 $6,570 $3, :1 2 C limit $9,450 $11, :1 The estimates for ozone are from an earlier slide. The estimates for climate are from Nordhaus (2008). Note: 1. Ozone numbers in 1997 dollars; climate in 2005 dollars. 2. Ozone estimates through 2050; climate through Ozone discounted at 5%; climate at about 4%. 4. Ozone costs are estimates; climate costs assume optimality.

29 Reasons for Kyoto s Failure Economics not as favorable as for ozone. In contrast to the MP, few countries have an incentive to do much unilaterally. Trade leakage; global energy markets: MCs steep. Gradual climate change winners & losers. Abrupt/catastrophic climate change uncertain. Kyoto difficult to enforce.

30 Reasons for Kyoto s Failure Economics not as favorable as for ozone. In contrast to the MP, few countries have an incentive to do much unilaterally. Trade leakage; global energy markets: MCs steep. Gradual climate change winners & losers. Abrupt/catastrophic climate change uncertain. Kyoto difficult to enforce Carrots: Will rich countries pay for abatement? Sticks: Trade restrictions problematic.

31 Why did the U.S. not ratify? Senate Resolution August the United States should not be a signatory to any protocol which would (A) mandate new commitments to limit or reduce greenhouse gas emissions for the Annex I Parties, unless [it] also limit[s] or reduce[s] greenhouse gas emissions for Developing Country Parties within the same compliance period, or (B) would result in serious harm to the economy of the United States.

32 U.S. Strategy Under Clinton Negotiate and then seek ratification. Under Obama Secure domestic legislation and then agree to do this as part of an international agreement.

33 Congress 1997 Senate resolution issues remain. House bill says: The Administrator, in consultation with the Department of State and the United States Trade Representative, shall annually prepare and certify a report to the Congress regarding whether China and India have adopted greenhouse gas emissions standards at least as strict as those standards required under this Act. If the Administrator determines that China and India have not adopted greenhouse gas emissions standards at least as stringent as those set forth in this Act, the Administrator shall notify each Member of Congress of his determination, and shall release his determination to the media. Is unilateral action on this scale the right way to go?

34 Copenhagen 2009

35 Copenhagen Accord Negotiated by US + BASIC Opposed by Bolivia, Cuba, Nicaragua, Sudan, Tuvalu, and Venezuela.

36 Copenhagen Accord deep cuts in global emissions are required to reduce global emissions so as to hold the increase in global temperature below 2 degrees Celsius. We should cooperate in achieving the peaking of global and national emissions as soon as possible.

37 Selected submissions Annex I Party Pledge Australia Reduce its GHGs 25% on 2000 levels by 2020 if the world agrees to an ambitious global deal capable of stabilizing at 450 ppm CO2e. Will unconditionally reduce emissions 5% below 2000 levels by 2020 and by up to 15% if there is a global agreement which falls short of securing atmospheric stabilisation at 450 ppm CO2e and under which major developing economies commit to substantially restrain emissions and advanced economies take on commitments comparable to Australia s. Canada EU 17% to be aligned with the final emissions target of the United States in enacted legislation. 20% by 2020 and 30% provided that other developed countries commit themselves to comparable emission reductions and that developing countries contribute adequately according to their responsibilities and respective capabilities. Base year

38 Selected submissions Annex I Party Japan New Zealand US Pledge 25%, premised on the establishment of a fair and effective international framework in which all major economies particiapte and on agreement by those economies on ambitious targets. Between 10 and 20% by 2020, if there is a comprehensive global agreement. This means: the global agreement sets the world on a pathway to limit temperature rise to not more than 2 C; developed countries make comparable efforts ; advanced and major emitting developing countries take action fully commensurate with their respective capabilities. In the range of 17%, in conformity with anticipated U.S. energy and climate legislation, recognizing that the final target will be reported to the Secretariat in light of enacted legislation. The pathway set forth in pending legislation would entail a 30% reduction in 2025 and a 42% reduction in 2030, in line with the goal to reduce emissions 83% by Base year

39 Cancun 2010

40 Durban 2011

41 Decision under UNFCCC Noting with grave concern the significant gap between the aggregate effect of Parties mitigation pledges in terms of global emissions of greenhouse gases by 2020 and aggregate pathways consistent with having a likely chance of holding the increase in global mean temperature below 2 C or 1.5 C above pre-industrial levels, Recognizing that fulfilling the ultimate objective of the Convention will require strengthening the multilateral rules-based regime under the Convention.

42 Decision under the UNFCCC decides to launch a process to develop a protocol, another legal instrument or an agreed outcome with legal force [my emphasis] under the Convention applicable to all Parties [my emphasis]. Ad Hoc Working Group on the Durban Platform for Enhanced Action shall complete its work as early as possible but no later than 2015 in order to adopt this protocol, legal instrument or agreed outcome with legal force and for it to to come into effect and be implemented from the process shall raise the level of ambition.

43 Canada s Environment Minister Peter Kent

44 Doha 2012

45 A positive development Effect of MP on climate change. Proposal to control HFCs under the MP. Perhaps we can achieve more by breaking the problem up, addressing each part using a different approach.

46 What else can we do?

47 Adaptation

48 Geoengineering

49 Air capture

50 What about the future?

51 For sure: There will always be another meeting!

52 And The climate, our institutions, and our technologies will co-evolve.