As negotiations at Copenhagen near conclusion, it is increasingly unlikely that a global deal can be made.  On Tuesday, the United Nations released the latest official draft agreements that will be presented to world leaders (including President Obama) in the final two days of the climate conference.  The recent drafts acknowledge that industrialized nations have historically been responsible for global greenhouse gas emissions and, thus, must lead efforts to combat climate change by providing funding and technology to poorer nations.  Both the text from the Long Term Cooperative Action working group and the document from the Kyoto Protocol working group, however, leave many critical issues unresolved.  Most notably, the international community has not agreed upon targets for emission cuts and adaptation funding.

Emission reduction targets

Developed countries and developing countries disagree on which countries should be obligated to reduce their emissions and what the level of these commitments should be. Leading developing countries insist on an extension of the Kyoto Protocol, which imposes obligations to reduce greenhouse gas emissions only on industrialized nations.  A rift within developing countries emerged when small island states and several African states insisted on a new protocol that would not only impose more stringent emission cuts for developed nations, but also expose developing countries to the risk of mandatory cuts. The European Union and the U.S., on the other hand, are calling for a more comprehensive document that would impose mandatory emission cuts on large emerging economies like China.  Developed countries also seek to delay the implementation of legally binding emission reductions.

The size of emission cuts and the benchmark for measuring these reductions is also a point of contention between developed countries. The EU has committed to cutting its emissions by 20% by 2020, and by 30% if a strong global agreement is reached. The EU’s proposed emission reductions are measured against 1990, as called for in earlier international agreements.  By contrast, the U. S. wants to use 2005 as the baseline year for cutting emissions because (i) the U.S. never joined Kyoto and (ii) this benchmark is more relevant to the Obama administration.  The U.S. has committed to cutting emissions by 17% of 2005 levels by 2020.  This corresponds to a cut of 3-4% beneath 1990 levels by 2020.  Senator John Kerry reinforced the legitimacy of the U.S. commitment to an international agreement by guaranteeing that this commitment would be enforced domestically, provided that China and other developing countries meet the U.S. demand for transparency and accountability on their emission reductions. 

Other issues, such as the “peaking year” concept, are also creating roadblocks.  India has taken the lead in opposing the imposition of a “peaking year” on the emissions of countries like India, China, Brazil and South Africa, which would demand that developing countries “peak” their emissions by 2025.  Instead, India proposes limiting the increase in global temperatures to within 2 degrees Celsius of pre-industrial times.  A smaller group of 43 of the smallest and most vulnerable developing countries has stated they will not accept any rise of more than 1.5 degrees Celsius since, they contend, anything higher would lead to disastrous consequences (e.g., a rise in sea levels as a result of climate change).

Another issue is the “hot air” concern.  With the collapse of the heavy industrial base of the Soviet Bloc countries in the 1990s, a large number of the carbon rights, or Assigned Amount Units (AAU), held by Russia, Ukraine and other Eastern European countries were never used.  If, under the new deal, the former Soviet Bloc countries are allowed to sell these surplus AAUs, or “hot air”, to nations that fail to meet post-2012 emission targets, this could impair all emission reduction commitments under the new deal by up to one-third.

Funding commitments and transparency

The G77 group of countries, backed by the least developed countries and small island states, are seeking $400 billion per year (1% of the GDP of industrialized nations) to help developing countries grow without increasing their greenhouse gas emissions.  Developed nations have not made offers anywhere near that level, nor do the latest draft agreements provide for funding beyond 2012.  As a compromise, the African Union chief negotiator Meles Zenawi has called for a significantly scaled-back finance deal, calling for $50 billion per year for developing countries by 2015 and $100 billion per year by 2020, with half of these funds allocated to vulnerable and poor countries, regions such as Africa and small island states.

China has acknowledged the needs of poorer developing nations in conceding that these nations should take priority in receiving aid to combat climate change.  China maintains its position, however, that industrialized nations should provide 0.5-1% of their annual GDP as funding to subsidize the efforts of developing nations to curb greenhouse gas emissions.  Further, China strongly opposes carbon tariffs proposed by other countries to protect their domestic industries. China has also refused to submit to international verification of whether it is actually implementing its reduction commitments.

The U.S. has rejected the proposal that industrialized nations contribute up to 1% of their GDP. The U.S. and other developed countries also seek to monitor developing countries on their compliance with whatever commitments are ultimately made, or at a minimum, to subject countries’ emission reports to international consultation and review.  The concern is that, without such compliance checks, some developing countries may have an incentive to “pad” the amount of their greenhouse reductions or otherwise game the system and that other countries may not sign on to the international agreement due to its lack of transparency.

With less than two days remaining for the climate change negotiations at Copenhagen, it is critical that the international community reach some sort of workable consensus on the key issues of emission reduction targets, funding commitments and transparency of the global system.

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