Regarding ‘EU climate negotiator signals end of ‘free lunches’‘:
In the run-up to the Copenhagen COP and further to your interview with the European Commission’s Runge-Metzger, PWR would like to raise the question: ‘Is what is being negotiated by all parties in fact simply ‘business as usual’?’ (BAU).
To be effective, non-BAU scenarios normally require targets or limits that are challenging and which are achieved in realistic timeframes. In turn, this leads to real changes in behaviour and hence real reductions in GHG emissions.
Our research suggests that for the most part, GHG policy has so far lead to BAU and increasingly features timeframes disconnected from electoral or political cycles (e.g. 2030 or 2050).
Moving from the general to the specific: the USA. In its public COP paper published in January, the Commission proposes that the US reduces its GHG emissions by 24% below 1990 levels by 2020. The current US position aims for parity with 1990 emissions by 2020. The EU position seems unrealistic, the US position looks like BAU.
Taking one representative industry sector: in the US transport sector, cars and trucks account for 20% of US GHG emissions. Average fuel consumption for new cars and trucks (2004) in the US was 12lit/100km. There have been various proposals to raise US standards to around 9lit/100km by 2022.
EU new fleet average consumption was around 8lit/100km in 2004 and will reach about 6lit/100km in 2012. Given that US automotive companies are active players in EU markets, it would be easy for them to transplant their EU engine technology into US vehicles.
A doubling of US fuel economy by 2020 (or indeed by 2012) could lead to a halving of transport emissions. This won’t happen, because although disruptive change is needed, the default setting for most policymakers (and industry’s preference) is BAU. In February, a US car manufacturer opened a state-of-the-art engine plant to build V6 3 litre motors for passenger vehicles: BAU.
The EU is no better. The EU regulation covering Cars and CO2 is simply BAU. Two European OEMs will launch this year, mass market vehicles that will have lower CO2 emissions than those mandated for 2012. Indeed, before 2012, the EU light vehicle fleet will for the most part easily exceed the provisions of the regulation. A cursory glance at the recent Geneva motor show and its ‘green vehicle’ emphasis reinforces this view. So much for EU GHG legislation driving GHG reductions by pushing industry to do more.
Within the EU COP document, there is also talk of American forests somehow counting towards emission reductions. This can be classed as an accounting sleight of hand. Although forests help reduce the rise in GHG emissions, it is only concrete actions (burning less coal, burning less oil etc) which will lead to real emission reductions. Anything else is BAU.
Moving on to the ‘developing (?) world’, and more specifically the dynamic duo China and India. The EU’s COP document is somewhat vague with respect to addressing this pair’s growing GHG emissions. It mentions a 15 to 30% reduction by 2020 over 2020 BAU. Some straightforward creative accounting is more than capable of producing a 15% reduction below BAU.
Expressed another way, if there are no challenging targets (15% is not challenging in rapidly growing economies), there is only BAU. A recent McKinsey report on China notes that even deploying the best available green technology, Chinese emissions will rise by around 10% by 2030 on already high 2005 emissions.
A key element of current EU policy is to develop CCS and hope that China will use it to reduce its emissions. A glance at the trade balance between China and the EU shows a supplier–customer relationship. In the real world, it is normally the customer that calls the shots. However, in the ‘Alice in Wonderland’ world of climate negotiations, this relationship seems to be reversed which bodes ill for ‘challenging’ GHG emission reduction targets. In the case of India, recent comments by Mr Saran, India’s chief climate negotiator, indicate that India will accept no targets on GHG emissions, so for India it is BAU.
With respect to GHG financing, the EU document and Mr Metzger mention all sorts of impressive numbers ending in billions and aimed at “developing countries”.
Many ‘developing’ countries are becoming very unhappy with the current situation. In turn, this will make the COP negotiations much more difficult. If money that has already been pledged has not been disbursed (cue: doners warbling on about developing countries having a ‘lack of capacity’ to absorb the aid) then how does Mr Metzger propose to disburse all the new lucre supposedly on offer?
The EC COP position paper is not all bad. It slays the Indian IPR dragon and starts to address CDM. But for the most part it looks like BAU.
PWR will be undertaking further work in the near future to confirm the hypothesis that current EU and by extension global GHG emission reduction policies will result in BAU and that 450ppm will be exceeded unless action is taken which is disruptive.