Liz Bossley – 1 August, 2010
Based in London, Liz is a member of the Board of Advisors of Climate Alliance Limited,  a carbon trader and the CEO of Consilience Energy Advisory Group Ltd. http://www.ceag.org/

Cancun Catch 22

After the soaring hopes and crashing disappointment that was the Copenhagen conference last December, climate negotiators are keen to play down expectations for the Cancun COP 17 climate conference starting at the end of November this year. The countdown has begun and when it reaches zero the Kyoto Protocol blows up.  

The Kyoto Protocol contains a self-destruct clause.  Article 3 commits 38 developed countries to ‘reducing their overall emissions….by at least 5 per cent below 1990 levels in the commitment period 2008 to 2012.’ And the rest, as they say, is silence. Unless a new deal is agreed before the end of 2012 the Kyoto Protocol is no more.

Before we can even start talking about what a new deal can look like we first have to look at the Kyoto definition of ‘agreement’ to any new deal. The body of the UNFCCC has explained the agreement mechanics for us in a helpful paper published on 20th July as an aide memoire for the next meeting of the ‘Ad Hoc Working Group on Further Commitments for Annex I Parties under the Kyoto Protocol’ taking place in Bonn, 2–6 August 2010.

To extend or amend the existing commitments of the 38 countries that have accepted caps under the original Kyoto Protocol or to add new countries to the capped list requires consensus or, failing that, the agreement ‘by a three-fourths majority vote of the
Parties present and voting at the meeting.’ This would take the form of an amendment to Annex B of the Kyoto Protocol – the annex that lists the countries that are capped and the percentage reduction targets they have accepted.

This differs from the original Kyoto Protocol, which took 7 years to achieve full force and effect because it required ratification by at least 55 countries responsible for at 55% of 1990 CO2 emissions by developed countries that have signed the UNFCCC .

The vote for a new protocol can only be held at ‘a Conference of Parties (COP) to the UNFCCC serving as a Meeting of Parties (MOP) to the Kyoto Protocol’. The voters are entitled to six months notice of the text on which they are being required to vote.

‘Parties’ in this context means parties to the Kyoto Protocol. It gives one country, one vote regardless of size of the country and there are 190 signatories to the Kyoto Protocol. We need 143 countries to vote yes before a new deal can get off the ground.

The USA, of course,  is not a Party to the Kyoto Protocol although it is a party to the UNFCCC. So, in theory, the USA can only attend COPs, not MOPs. But since a COP also serves as a MOP, the USA has a seat at the table. But because the USA has not ratified the Kyoto Protocol presumably it does not get a vote on the successor to the Kyoto Protocol. This gives us a flavour of the bureaucracy that is bogging down discussions.

There are only three COP/MOP meetings, shortened to ‘CMP meetings’  in UNFCCC parlance, currently scheduled at which a vote can take place before the Kyoto Protocol ends:
•    Cancun 29/11/-12/12/2010
•    South Africa 28/11- 9/12/2011
•    In an as yet unspecified country 26/11-7/12/2012

Given the need for six months notice of the text on which a vote can be taken and given that a vote at the meeting does not constitute acceptance by a country we can begin to work back to uncover the actual Kyoto deadline for agreement. A country that votes for an amendment to the Kyoto Protocol must deposit formal acceptance with the UNFCCC before it is seen to be ratifying the new deal. Acceptance at a meeting is no guarantee of ratification: the USA voted for the Kyoto Protocol at COP 3, but failed to ratify it because the US Senate did not agree.

Each country has its own domestic legislative procedure, and in many cases elections that may result in new governing party, to be gone through before it can ratify any deal for which it votes at a CMP. That’s why it took seven years for the Kyoto Protocol to enter into full force and effect.

Once the formal ratification is achieved by a country the new deal enters into effect for that country 90 days later, subject to the 75% pass mark already having been reached. Even if the 75% pass mark is reached, a country that has not ratified the deal cannot be forced to be bound by its terms.

Working backwards from end 2012, the South Africa 2011 meeting is the last chance saloon for a seamless transition from the Kyoto Protocol ending on 31st December 2012 to a new deal staring on 1st January 2013. A 75% pass mark vote at a CMP does not guarantee full ratification before end 2012.

So why don’t we just or change the timetable and notice periods? This is where the Catch 22 comes in. Any such change to the deadlines or agreement timetable requires the same voting pass mark and lead time as amending Annex B to the Kyoto Protocol itself.

The Kyoto Protocol timetable for agreement runs the risk of standing in the way of the very agreement it seeks to promote.

That is why the Copenhagen Accord is so seductive. It simply ignores these bureaucratic issues and starts with a clean sheet of paper. It asks what are countries prepared to sign up to now and how are we going to fund it? At a single leap it shakes off not only the inconvenient timetable, but also the legacy stumbling block of whether or not Russia and the Ukraine should be allowed to carry forward their surplus allowances (hot air) from the first commitment period of the Kyoto Protocol. It sets new targets that countries have a better chance of getting over domestic legislative hurdles than targets that have to be discussed and agreed with 190+ other countries.

If the Copenhagen Accord produces a commitment from the major emitters – the USA, China, India, Russia, Europe- to act now, then we can move forward without wringing our hands about pass marks or voting procedures. The rest of the countries can sign up and join in whenever they have cleared their own domestic hurdles. These other countries are important to achieving the cuts in emissions that the scientists advise. The big five could have an impact without the rest of the world. The rest of the world could not have an impact without the big five.

No country is going to sign up to more than its politicians can clear at home without losing their seat of power and no amount of sitting around in conference rooms will change that. China will not be swayed by oratory to cut its emissions intensity by more than it deems to be in its own best interests.  The USA is struggling to even achieve Obama’s promised cut of 17% below 2005 levels by 2020.

The meetings that matter are taking place behind closed doors in the context of trade discussions that are wider than those dealing simply with mitigating climate change. A new world order is forming and its shape will not be determined by UNFCCC meetings.

In seeking to achieve agreement to a new climate change mitigation deal we run the risk of throwing the baby out with the bathwater. The cap-and-trade concept that underpins the Kyoto Protocol is as clever as it ever was. It can work much more effectively than command and control policies or taxation.

The UNFCCC and the Kyoto Protocol, while frustrating in its bureaucracy, has also put a necessary mechanical framework in place which it would be wasteful to dismantle.We need an independent supra-national authority of some sort to issue, track and retire allowances and police the verification and enforcement of caps, if cap-and-trade is to survive.

The Clean Development Mechanism and the Joint Implementation project process, though under-resourced and far from perfect, has given us measuring and monitoring methodologies and created allowances - CERs and ERUs - that are potentially fungible throughout all the domestic cap-and-trade schemes that operate worldwide.

The International Transaction Log and registry system could be recreated in the private sector, but why re-invent the wheel?  This Kyoto wheel is turning surprisingly well and has delivered real savings in GHG emissions, despite all the gripes about HFC23. It is even capable of independent verification of projects in China, a country which has resisted any other attempts to intrude on sovereign territory to audit its GHG emissions.

The best outcome all round would be for significant progress to be made at Cancun this year, which would allow the production of a text by June 2011 that could pass a vote in South Africa next December. That would give us until 1st October 2012 to get the 75% pass mark needed for a new deal to take in effect on 1st January 2013.  

We must hope for the best, but plan for the worst. We need the Copenhagen Accord discussions to move forward in parallel with the UNFCCC talks in the hope that one of them succeeds. It doesn’t matter who collects the Nobel Prize for the next deal. We just need a deal.