The Path to Paris: Evolution of a Climate Regime

by Gilbert Metcalf on March 3, 2014

COP18The 2011 Durban Platform for Enhanced Action laid the groundwork for four years of negotiations under the United Nations Framework Convention on Climate Change (UNFCCC) to culminate in a new “protocol, another legal instrument, or an agreed outcome with legal force under the Convention applicable to all Parties.” In plain language, an agreement to reduce emissions will be concluded at the 2015 Paris Conference of the Parties (COP) to go into force in 2020. To succeed, the COP will need to include a mix of climate mitigation approaches and accept extramural activities like multilateral or bilateral initiatives.

As with all negotiated texts under the UNFCCC, much of the language is deliberately vague so as to kick problematic issues down the road. A particular sticking point is how developed and developing countries shall be differently required to take on obligations to address climate change. How this difference gets resolved will be a major topic at the next COP in Lima Peru later this year as well as the UN Secretary General’s High Level Summit on Climate Change scheduled for this September. One reasonable outcome will be an acceptance of the principle of all countries taking on obligations but recognizing that the obligations taken on will differ across countries based on their respective capabilities.

It is also likely that whatever agreement emerges in Paris, it will consist of a mixed set of commitments (or “contributions” to use the terminology of the most recent Warsaw COP agreement) that mix targets and timetables with menus of actions. Regardless of the ambition of the resulting agreement, the 2015 agreement can be most productive if it incorporates the following four features:

1) Do no harm. Any climate agreement will be most effective if it avoids inappropriate or heavy-handed rules that impede efficient, cost-effective mitigation by the Parties. An example is the “supplementarity principle” that discourages (or prohibits) countries from achieving a share of their mitigation commitments through international offsets. Greenhouse gases are a global pollutant, and as such, it makes no difference to the environment whether France, for example, reduces a ton of emissions locally or enters into an agreement to reduce a ton of emissions in India. Restricting such bilateral agreements can only drive up the cost of global emission reductions.

2) Encourage extramural efforts. The UNFCCC has 195 Parties to the Convention. Yet eighteen countries (including the EU as a single country) account for eighty percent of GHG emissions. In fact, the top three parties (China, United States, and the EU) account for fully half of global emissions. The difficulty of negotiating meaningful agreements goes up exponentially with the number of participants. It may well be that the most significant efforts to reduce emissions come about through bilateral and multilateral initiatives outside the UNFCCC process. The Paris Agreement should support these efforts.

3) Facilitate, facilitate. While the major agreements to reduce emissions could emerge through a process of smaller scale negotiated deals outside the UNFCCC process, the UNFCCC remains a critically important player in the process. It could play a constructive role through its work to develop consistent and uniform emission reporting rules along with other “rules of the road” to assist in what is likely to be a heterogeneous system of approaches to reducing emissions.

4) Avoid costly redundancies. This is less a policy prescription for the Paris Agreement than for countries assembling their packages of commitments. Consider the EU’s commitment to reduce emissions by twenty percent, largely through the EU Emissions Trading System (ETS), while at the same time requiring at least twenty percent electricity come from renewable sources (with binding targets for each country). Such overlap is costly on several dimensions. First, the presence of a renewable electricity supply mandate can only drive up the cost of achieving the emission reductions committed to under the EU ETS. Second, complimentary policies drive down ETS allowance prices and contribute to the perception that the ETS is a failure (note the current allowance price of about four euros a ton). Worse, the quota discourages investment in new energy-efficient and emission-reducing capital, thereby blunting clean energy innovation in sectors other than the specific renewable energy sources mandated under the quota. The beauty of a robust and predictable carbon price is that it encourages innovation in all sorts of technologies that can reduce emissions, not just targeted technologies.

The Paris Agreement is one element of the complex mix of efforts to address global climate change. A constructive agreement will be one that facilitates activities in a variety of fora and recognizes the heterogeneity of approaches required to reduce emissions.

 

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This piece is part of The Fletcher Forum of World Affairs’ 2014 Global Risk Forum. The Global Risk Forum is an effort to convene conversations around some of the most pressing issues we face as a global community in the year ahead: the breakdown of climate change negotiations; the spread of sectarian violence in the Middle East; the credit crisis and economic slowdown in China; the growth of cyber espionage; and the unraveling of Africa’s economic boom. We encourage you to read the conversations, participate with written responses or on social media, and help us work together to produce constructive ideas that will reduce the aggregate risks we face. 

 

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