Sceptic Watch: 2011 11 28 - COP17/CMP7 at Durban

The Climate Institute

The 2011 Durban Climate Summit ended with the adoption of a set of 37 formal UN decisions … in three key areas:

Agreement to negotiate a single, legally binding agreement by 2015 that will cover all major carbon pollution emitters including, most importantly, China, India and the United States;
Establishment of the Green Climate Fund, building on the commitment made in Cancun to raise US$100 billion a year to help the world’s poorest nations invest in clean energy and manage the unavoidable impacts of climate change;
Commitment from all countries to increase the level of ambition of national efforts to reduce pollution, building on the formal recognition that existing commitments are not enough to keep global warming below 2 °C or 1.5 °C above pre-industrial levels. …

With the agreement to a have a single legally binding agreement for all nations, an important roadblock and ongoing excuse for limited action has been removed.

The Durban outcomes also have domestic political significance for Australia.
Most importantly the unconditional 5% reduction target is increasingly irrelevant as it is based on the assumption of limited global action.
To increase international credibility and ensure Australia does its fair share internationally the Government should move to the higher end of its target range.
The Coalition is even more exposed as virtually no one believes it can achieve its minimum 5% reduction target with current policies.

(The Durban Climate Summit: Implications For Australia, December 2011, p 4)

Implications For Australia

The Future of Global Climate Action

COP17/CMP7

17th Conference of the Parties to the United Nations Framework Convention on Climate Change (UNFCCC).
7th Session of the Conference of the Parties serving as the Meeting of the Parties to the Kyoto Protocol.
28 November to 11 December 2011.

The Durban Climate Summit: Implications For Australia, The Climate Institute, December 2011.

Appendix: Key Outcomes from the Durban Climate Summit

Key Objectives of the Durban Platform For Enhanced Action
Progress	Neutral Outcome	Negative Outcome
*Pollution Reduction Commitments and global goals*
Reaffirmed the ‘below 2°C’ global goal and recognition of possibility of needing to strengthen this to 1.5°C.		Parties were unable to agree on a peaking year for global emissions, or a 2050 global goal.
Noted the ‘significant gap’ between this goal and the commitments currently on the table.
Commits governments to [increased] ambition … under the new legally binding agreement to be in place by 2015.
*Agreement on the legal form of future international climate change agreements*
Commitment to negotiate a new legally binding agreement to be in place by 2015 and in force by 2020 [ensuring] that pollution reduction commitments and actions from [the US, India, China, Europe and all other major emitters] will be covered by [a single instrument]. While there will continue to be some differentiation in the strength of each country’s commitment, they will have the same legal effect.
*Kyoto Protocol*
Decided that a second commitment period for the Kyoto Protocol would be established, covering the period 2013-2017 or 2013-2020. Countries — including Australia — have been invited to submit a national target for the second commitment period by May 2012.	A number of other decisions on the gases covered and the reporting guidelines were also made. New rules for accounting for land use, land use change and forestry emissions were agreed [including] making accounting for emissions from forest management mandatory and capping the amount of credits and debits that countries can use from forest management towards meeting their targets.
*Transparency and accountability*
Developed countries agreed to provide more details on their mitigation targets by March 2012, including the assumptions used and gases and sectors covered, [to] improve the transparency of current pledges. These submissions will be made using a common template to allow comparisons between countries to be made.		No framework or process for new common accounting rules agreed to define and measure the progress countries are making towards their targets.
Developing countries will also provide further details on their mitigation pledges, through a series of structured workshops. [Ideally] this information should also be submitted formally using a common template, rather than relying on workshops.
[Agreement] to establish a ‘registry’ of mitigation actions in developing countries [to] link actions with funding.
[Mandatory] biennial reporting of progress on emissions reductions … for all developed … and major emitting developing countries …
Establishment of new processes to allow an open assessment of the progress … For developed countries [‘international assessment and review’] will focus [on monitoring] progress towards their [targets.] [For] developing countries [‘international consultation and analysis’ will] provide more transparency and facilitate the implementation of mitigation actions.
*Finance*
[The] Green Climate Fund was officially launched and will have its first meeting before April 2012 [with the] World Bank [acting] as an interim trustee … to ensure it is managed in accordance with the highest fiduciary standards.
[Provisions] have been made to finance private sector pollution reduction efforts [to] leverage greater levels of private finance.
[Agreement] to undertake a work program to analyse options for long-term sources of finance.
*2013-15 Review*
Established a process [to review the adequacy of the goal of keeping global warming below 2°C], beginning in 2013
*New market mechanisms*
An undertaking to maintain and build on existing mechanisms associated with the Kyoto Protocol.	No decision to establish new market based mechanism but a work plan that will define a framework for new market based mechanisms to ensure they are credible and deliver real pollution reductions.	However, the credibility of new mechanisms rests heavily on [the] establishment of common … clear and robust [accounting rules — without which] market mechanisms will not be credible.
*Address emissions from the destruction of tropical forests (REDD)*
	Decisions were made on setting reference levels for deforestation, but concerns remain about the environmental rigour of these processes [and potential] loopholes remain.	No final decision on financing mechanisms for REDD, including international trade.
	The procedures for safeguarding against unintended social and environmental consequences of REDD projects have been decided [though] concerns remain that these are not strong enough.
*Adaptation*
[The] Adaptation Committee [was established] to oversee the implementation of the Adaptation Framework launched in Cancun [and] enhance the UN’s work on climate change adaptation [in the] poorest and most vulnerable countries.
The … possibility [was raised] of establishing an international mechanism to address loss and damage [since] small island countries … are already experiencing loss and damage from sea level rise.

(p 15)

Scenarios for Durban

[The Climate Institute identified four scenarios on how the conference might unfold …
Despite some worrying moments during the negotiations which ran almost two days overtime, the Durban Summit produced an outcome somewhere between the ‘Progress’ and ‘Breakthrough’ scenarios.]
(p 5)

A New Legally Binding Agreement by 2015

The most significant outcome from the Durban Climate Summit was the Durban Platform for Enhanced Action — the decision to create a new, legally binding, international agreement in place by 2015 and in force from 2020.
This will include pollution reduction commitments from all major emitting countries, including the US, China, India and Brazil …

[The] principle barrier to a more comprehensive agreement has been the divide (or “firewall” in UN speak) between the industrialised countries — listed in Annex 1 of the Convention — and the developing world — Non-Annex 1.
For example, this was the primary reason the USA never ratified the Kyoto Protocol.

A number of misconceptions have emerged since the Durban Platform was agreed:

It is just an agreement to keep talking.

This underestimates the historic resistance by emerging economies to having their actions internationally accountable. …
[In] Bali in 2007 it was never agreed that a treaty would be the outcome.
The Durban Platform overcomes this long-standing dispute and defines a legally binding agreement as the end point of a negotiating process that is seeking to redefine the direction of the global economy. …

Obligations only start in 2020 and countries will not act in the meantime.

Many countries are already implementing domestic laws to meet the targets they pledged in Copenhagen and Cancun.
While these are not internationally binding or sufficient to avoid dangerous climate change they are binding on domestic industries.
… China is expanding and implementing its policies as it gains confidence that they can be achieved. …
[In] the USA, the EPA is regulating, or in the process of regulating, over 70% of US emission sources and Federal and state governments are offering a range of clean energy incentives.
These laws are driving multibillion dollar investments in clean energy and other low pollution industries in these countries. …

As countries have become more comfortable that they can meet their targets in a politically and economically sustainable way, they will be more likely to commit these targets internationally.

[Countries must] accelerate domestic policy making to prepare for stronger international commitments, prior to the adoption of the new agreements in 2015.
The EU, China and Australia in particular are well prepared to meet new binding obligations due to the implementation of robust domestic policy frameworks.

(p 6)

What Exactly Was Agreed?

The specific language used in the Durban Platform decision is to

develop a protocol, another legal instrument or an agreed outcome with legal force under the Convention applicable to all Parties.

[‘Protocol’ refers] to a new, legally binding international treaty that would need to be ratified by all participating parties. …

‘[Agreed] outcome with legal force under the Convention’ also implies the establishment of a new treaty. …

‘[Legal] instrument’ was used in the Berlin Mandate in 1995, which led to the adoption of the Kyoto Protocol in 1997.
(p 7)

Green Climate Fund

[The] Green Climate Fund … will become operational in 2012. … [The] goal is to identify sources capable of delivering at least US$100 billion a year globally by 2020 …

Closing the Gap on Ambition

[Current] pledges for emissions reductions to 2020 are insufficient to meet the two degree goal …

[As] part of its submission of a new Kyoto target the EU will consider lifting its target from 20% reductions on 1990 levels by 2020 to 30%. …

The EU and Australia increasing their ambition will be important because:

The EU’s and Australia’s current unconditional targets do not compare well to targets set by comparable countries.

[The] average minimum emission reduction on 2000 levels committed to across advanced countries is around 20% reduction by 2020.
Australia’s minimum is a 5% target and
the EU’s minimum target equates to a 10% cut on 2000 levels.
Japan’s and New Zealand’s minimum targets are around a 30% cut on 2000 levels and
Norway’s is a 35% reduction on 2000 levels.

Geopolitically, adopting a higher target will reinforce strategic alliances with the Alliance of Small Island States (AOSIS) and Least Developed Countries (LDCs).

The ability of the EU to deliver greater ambition out of Durban is directly linked to the alliance … they created with developing nations who are most vulnerable to the impacts of climate change — AOSIS and LDCs.

(p 8)

It would provide an important short-term boost to global carbon markets.

From 2015, Australia’s emission trading scheme will accept UN compliant international credits.
[Current] forecasts suggest that out to 2020 the supply of credits from existing Kyoto market mechanisms closely matches current expected demand from the EU, Australia, Japan and South Korea. …

The EU (and to a lesser extent Australia) lifting the level of their targets would boost the currently depressed global carbon market by increasing the value of emission units and providing investors with greater confidence to invest in new offset projects.

(p 9)

Implications for Australia

Pollution Targets

Under the Clean Energy Future Act, the Australian Government does not have to commit to a 2020 target until 2014 …

… Labor and the Coalition [support] reducing emissions by 5–25% below 2000 levels by 2020 … based on the levels of domestic action around the world and certain framework decisions made internationally (e.g. access to international carbon markets).
The Greens advocate a 25–40% target range.

[The] Department of Climate Change and Energy Efficiency has advised that the conditions have been met for Australia to commit to at least a 10% target [and] that China’s pledge to reduce the emissions intensity of its economy by 40–45% is consistent with … moving to a 25% pollution target.

[Analysis] by

The Climate Institute [indicates that] conditions for the 15% target have largely been met. …
… Professor Ross Garnaut implied that Australia’s 2020 target should be 10% [and]
researchers from the ANU [argue that] it should be 15%.

[The] Australian Government remains committed to a 25% target in the context of a global agreement consistent with keeping atmospheric greenhouse gas concentrations at 450 parts per million CO2-e, or lower.
This … would provide a 50/50 chance of keeping global warming below 2°C, which is necessary to avoid the worst impacts of climate change.
(p 10)

Keeping the 25% target on the table provides Australia’s diplomats with much needed leverage within the negotiations, and should be used to extract stronger commitments from other countries. …

In May 2014, the Government is required to set five years of pollution caps ahead of the transition to an emissions trading scheme in 2015.
A key test for the Government’s international credibility will be ensuring these caps do not close the door on moving to the 25% target if required. …
The [Climate Change] Authority will make its recommendations on the caps in February 2014.

About Australia’s Kyoto Protocol Target?

In May 2012 countries will begin submitting details of the target they are prepared to inscribe in the second commitment period of the Kyoto Protocol, which is currently expected to run from 2013-2017 or from 2013-2020.
The Australian Government declared that it will not participate in the second commitment period until a new agreement has been reached under the Durban Platform [and is] yet to indicate whether it will make a submission [of] targets in May 2012. …

[The] inclusion of an adjustment provision … as an amendment to the Kyoto Protocol … would allow [parties] to strengthen [but not to weaken] their target in 2015 when the Durban Platform negotiations are expected to conclude, without having to re open the Kyoto Protocol for re negotiation and ratification. …

In the absence of an adjustment provision, it would be unhelpful for Australia to lock in a weak target for the Kyoto Protocol’s second commitment period in May next year [as this would undermine] the ability to ratchet up the national target in light of international developments.
(p 11)

Coalition Policy

[Analysis] confirms that the Coalition’s Direct Action policy cannot achieve Australia's 5-25% international targets without billions of dollars of extra cost to the Australian economy. …

[If] the Coalition [were] to drop its pledge to repeal the carbon price legislation [this] would send a much more credible signal internationally, as well as providing greater certainty for Australian businesses looking to make investment decisions with time horizons beyond the next election.

[If] the current Government commits Australia to the Kyoto Protocol’s second commitment period this would effectively exclude soil carbon — the key pillar of the Coalition's policy — from the international accounting rules associated with our international target.) …

Long-term Finance Sources

In 2012 countries will begin considering options for new sources of long-term climate finance. …
[Researchers] at the Australian National University pointed to a range of different opportunities …

International bunker fuels

Putting a carbon price on fuel sold in Australia for international shipping and aviation purposes.
[Pending] an international approach … this measure can and should be put in place unilaterally.
At least half of the money raised from this source should go to international climate finance, with the remainder invested back into the shipping and airline industries to help them invest in low-pollution technologies and practices.

Fossil fuel subsidies

[Phasing] out remaining fossil fuel subsidies [and] redirecting 50% of these funds to investment in pollution reduction and adaptation efforts in Australia and 50% to developing countries.
In the medium term … allocating a portion of domestic carbon pricing revenue to international climate finance [beginning] as a relatively small fraction of the carbon price revenue, rising through time.

(p 12)

Diplomacy

The Durban Summit again highlighted the importance of domestic action in leveraging international credibility. … China … used the fact that it is taking more action than most major developed nations as a bulwark against calls for stronger commitments.
The EU was also able to leverage the fact that it has acted in advance of all other major economies to successfully argue to have all major economies covered by a single international binding agreement. …

[The] Alliance of Small Island States (AOSIS), demanding action from all major emitters, combined with the diplomatic confidence of the BASICs, has split the traditionally-cohesive G77/China developing country bloc.

Australia’s repositioning from a defensive posture under the Howard Government to a position more closely aligned with progressive advanced economies such as the UK and Norway has also partly broken down the internal developed country blocs.

[These] developments have led to the formation of the Cartagena Dialogue.
This … grouping of progressive nations from both the advanced and developing economies [but not the USA or the BASICs] was critical to the success of the Cancun meeting last year.

In Durban [the EU] joined with AOSIS and the least developed countries (LDCs) and formed an ambition coalition … that exerted the maximum pressure on India and other emerging economies to support a road map to a legally bind agreement.

Australia did not join, but did not block, the efforts of this group in Durban. …
[Does] it signal a shift back towards a stronger alignment with the USA? …

The Government has stated that it is the national interest to avoid a 2 °C increase in global temperature, as Australia is very vulnerable to the impacts of accelerating climate change.
The posture of the USA in the international climate negotiations is inconsistent with Australia’s national interest.
This raises real questions around … whether it would be more strategic for Australia to play a more visible and active role with the ambition coalition of the EU, AOSIS and the LDCs.
(p 13)

Legal Form of New Treaty

… Australia has played a lead role internationally in developing … solutions on how to capture commitments from … and provide incentives for [a board range of nations] to meet international obligations.
[In] advance of Copenhagen Australia proposed that each major emitter’s international commitments would be captured in an individual national ‘schedule’.
This kind of detailed policy analysis … should continue.
(p 14)

Would you like to know more?

Durban, Australia and the Future of Global Climate Action, November 2011.

Key Facts + Themes

Since the Copenhagen meeting in 2009 nearly 100 new significant pollution reduction and clean energy policies have been announced in major economies.
Over the last three years global investment in renewable energy like wind and solar power has been competitive with investment in traditional power generation.
China alone invested over US$50 billion dollars in renewable energy in 2010, followed by Germany (US$41 billion) and the USA (US$34 billion).
Climate negotiations are now in a state of transition — from a "treaty before action" world to an "action and agreement" approach.
Undue emphasis on the politics and symbolism of a global treaty has tended to overshadow the substantive practical progress that has been made.
Although these actions are significant, they remain insufficient to meet the objective of limiting the world to less than 2° C global warming.
… Australia's 5% pollution reduction target implies an emission reduction on 2000 levels similar to that of Canada but less than the EU, Japan, New Zealand, Norway and the USA.
The average reduction among comparable advanced economies is a 19% reduction on 2000 levels.

(p 4)

Summary and Conclusions

International Agreements

The Copenhagen meeting, with over-inflated expectations about achieving a new treaty and resultant perceptions of failure, eroded public confidence in the UN process.
Critical assessments of Copenhagen have since shown that it was, in fact, an important turning point.
In just two years, domestic policy implementation has reached unprecedented levels. …

Before the agreement of the Kyoto Protocol, domestic action beyond a small number of EU nations was driven largely by energy security needs.
However, the agreement and ratification of the Kyoto Protocol sparked a global investment boom in clean energy in developed countries [and] started to unlock multi-billion dollar investments in clean energy development in emerging and developing economies.
While not sufficient to avoid dangerous climate change, this investment combined with action to control local air pollution, increase energy security, build new local industries and foster low carbon competitive advantage have resulted in an unprecedented level of global action on pollution and clean energy. …
(p 7)

There is widespread realisation and acceptance that action … is in the national interest of individual nations for environmental, economic and security reasons. …
(p 8)

The Future of the International Framework

[In] September 2010, BHP Billiton, CEO Marius Kloppers noted,

"our preferred solution is the introduction of an international climate framework, which includes binding commitments by all developed and major developing economies to reduce greenhouse gas emissions.
[We] believe local actions that are eventually harmonised into unified global action is a more likely outcome than an immediate broadly supported global initiative.
We also believe that such a global initiative will eventually come, and when it does Australia will need to have acted ahead of it to maintain its competitiveness." …

(p 9, italics added)

Introduction

Rio to Durban

The agreement and ratification of the Kyoto Protocol sparked a new era of global investment in clean energy.
Countries with obligations to meet targets have put in place domestic policies to meet them.
Only Canada appears unlikely to meet its international commitments under the Protocol. …

[Following] the Global Financial Crisis of 2009 nations as diverse as South Korea, China, and the United States chose to divert significant proportions of their stimulus packages — worth around $521 billion — towards clean energy development and 'green' growth.
[Leading] developed and developing economies are not displacing climate change action with economic priorities;
they in fact see the shift to clean energy development as crucial for their economic recovery and global competitive advantage.
The Australian Government's passage of the Clean Energy Future legislation is consistent with this.
(p 15)

Challenges for the Global Climate Framework

Australia remains the most carbon intensive advanced economy per person. …
(p 19)

Does it boost global action?

If the world had ceased to act, by the end of the century the global temperatures would rise by a projected 7 °C above pre-industrial levels.
Currently, policies being implemented around the world could be enough to keep that increase to around 3-4 °C.
While this … falls short of what's needed to avoid significant and severe impacts from accelerating climate change [it does show] what can be achieved by nations working together. …

Is it legally binding?

Does it have broad coverage?

[Many] developing countries furiously maintain that the 'firewall' between Annex 1 and non-Annex 1 countries must remain.
Breaking down this divide is central to recent proposals by Australia and Norway on the capturing of emission reduction commitments in the new framework.
(p 20)

Does it provide long-term flexibility?

Does it unlock public and private sector financial flows?

Substantial, public and private sector financing will be required to avoid dangerous climate change.
Estimates suggest that between around US$150-300 billion a year will be required by 2030. …

Does it exacerbate or mitigate regime framework fragmentation?

While most countries recognise the advantages of a treaty based framework, in the policy debate there is broad recognition that new legally binding commitments for all Parties are unlikely to emerge before 2015.
This is because there is little support, at this point, from the major emerging economies such as China and India for committing [to] a new or expanded treaty regime.
Without such an agreement, the EU, the USA, Japan and other major advanced economies will not take on new legally-binding commitments.

While the USA says it is supportive of taking on legally binding commitments it has put forward a number of conditions that will be extremely difficult to satisfy and may block agreement by default.
(p 21)

[The] USA is seeking to dismantle the firewall between developing and developing country commitments overnight.
This is inevitable in the longer-term and should be open to negotiation but demanding it be agreed in Durban is unrealistic …

Many countries are implementing domestic laws to meet their targets.
While these are not internationally binding they are binding on domestic industries. …
China is expanding and implementing its policies as it gains confidence that they can be achieved. …
[In] the USA, the EPA is regulating, or is expected to regulate, over 70% of US emission sources and Federal and state governments have been offering clean energy incentives.
(p 22)

… The Evolution of the Global Climate Regime

Copenhagen saw for the first time international commitments expanding beyond advanced economies to all the world's major emitters.
We are now in a confidence building stage where domestic actions build constituencies for action and show international commitments can be met.

IPCC Global Warming Projections ~2100 (°C) (Adapted from Figure 1, p 23)
1990	~2.0-5.0
1995	1.0-3.5
2001	1.4-5.8
2007	1.4-6.4

Scenarios For Durban

[In] Australia the electricity price impacts of uncertainty around the future of the domestic carbon pricing in the electricity sector are comparable to the impact of the carbon price itself.
(p 27)

Australia's Fair Share of Global Efforts

Australia was the first major Kyoto country to stand up in Copenhagen and say it was prepared to take on a second commitment period target under the Protocol under a number of conditions. …

Under these conditions there is no reason why Australia should not agree to a second commitment period target and begin the process of turning this into a new international commitment which becomes binding upon entry into force of a new legally binding agreement that covers all major emitters.
(p 31)

[Internal] Departmental analysis suggests a new minimum target of 10% on 2000 levels by 2020 would be more in line with the commitments of other advanced economies.
(p 34)

[Department of Climate Change and Energy Efficiency:]

An outcome which sees Australia match the aggregate advanced country average would involve taking on larger economic costs and a more ambitious target, when national circumstances are taken into account. …
This is consistent with Australia’s desire to provide strong support and leadership for ambitious global action, and our recognition that Australia is expected to suffer greater harm from unmitigated climate change than most other advanced nations.

(p 35)

Fair Share of International Financing

Developed nations have also made a commitment to raise up to US$100 billion per year by 2020 to help the world's poorest countries reduce their economic dependence on pollution, protect their forests and manage the unavoidable impacts of climate change.

According to a study by researchers from the Australian National University, Australia should contribute 2.4% of this global financing goal.
This conclusion is based on an assessment of twelve different indicators of how the $100 billion target should be divided between countries, including contribution to global emissions and share of global GDp …
(p 36)

Pollution reduction targets for advanced developed economies on 2000 levels (%) (Adapted from Figure 3, p 37)
Australia	−5 to −25
Global Average	−19 to −27

Per capita pollution reductions based on 2020 targets for advanced developed economies (%) (Adapted from Figure 4, p 38)
Australia	-23 to -39
Global Average	−30 to −37

Reduction in the emission intensity of the economy based on 2020 targets for advanced developed economies (%) (Adapted from Figure 5, p 39)
Australia	-39 to -53
Global Average	−38 to −44

Emission reductions below current Kyoto 1st Commitment Period targets based on current low and high pollution pledges (%) (Adapted from Figure 6, p 40)
Australia	-12 to -42
Global Average	−16 to −29

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December 18, 2011

2011 11 28 - COP17/CMP7 at Durban