Many Fletcher alum in Copenhagen

My time at COP-15 was like a fast roller coaster ride. Emotions and moods went up and down, hour to hour. The entire two weeks sped along the rails extremely fast. Then it was over.

Demonstrating the far reaching nature of the Fletcher School, I attended COP-15 for several different reasons: to analyze proposed texts (drafts of possible treaties or accords) using the C-ROADS model, to promote an urban adaptation tool developed with MIT, to meet with country delegates and NGOs, and, as it turns out, to meet Fletcher grads.

I met Fletcher alum everywhere, simply by having my Fletcher-logo adorned briefcase. The prevalence of Fletcher grads surprised me. Having come to the Fletcher School in September, I’m still getting a sense of the school. I knew Fletcher is well-known, but I didn’t have a good idea of where all the graduates have gone. The answer, at least for two weeks this year, was Copenhagen. As I walked around the Bella Conference Center, took the metro, or sat in a restaurant, I continually was stopped by Fletcher alum. It was great: Everyone had a story, everyone was doing great work, and everyone was talking about the current news of the COP.

Fletcher was well represented in Copenhagen and, from everyone that talked with, truly engaged in the global climate negotiations process. I look forward to seeing everyone again in Mexico City.

2010: The Year of the Deal (I hope)

The Copenhagen climate talks have wrapped up. There have been many different assessments of “Copenhagen Accord.” Some people focus on the negative (“no real commitments!”) while others try to put a positive spin on the accord (“China and US agree!”).

While I want to be hopeful the talks didn’t waste a vast amount of international goodwill, the reality is that many went home frustrated and angry. And we, as a global society, are still heading for an unsafe world.

Analysis we did in during the COP shows that we are on track for 3.9 degrees Celsius of warming. That analysis, as part of the Climate Interactive team, is actually higher than 3.8 degrees Celsius we calculated before the Copenhagen talks. Why? The main reason is that countries didn’t propose any new initiatives to reduce emissions, and Japan actually reduced their proposed targets. A warmer world was not the outcome I was expecting from the climate negotiations.

During the two week period, proposals were introduced that, if fully implemented, would have kept the world below 2 degrees of warming. The Long-term Cooperative Action (LCA) working group suggested that global emissions in 2050 be kept below [50%/85%/95%] of 1990 levels. The [bracketed] text means that negotiators were still deciding the final number. The important thing to note is that all three values would prevent significant warming that we can expect given our likely emissions trajectory. All three values were on the right track.

The LCA texts were eventually dropped and the final Copenhagen Accord has no mention of a 2050 target.

But knowing that text did exist is heartening. My ‘optimistic self’ is trying to tell my ’3.9 deg analytical self’, “These talks set up 2010 to be the Year of the Deal.” I hope that is right.

What progress was made

Heads of state and others tactfully pronounced the Copenhagen climate change summit last week ‘an important first step’ and ‘a constructive discussion.’  Indeed, most cast a dusting of shimmering snowflakes over two grueling weeks of “negotiation by exhaustion,” as one official put it.  The truth, of course, is that the Copenhagen Accord is no substitute for a real-deal treaty.  While the accord itself is painfully disappointing to many, crucial breakthroughs occurred during the climate change talks.  Insights were gained about the likely components and shape of a successful package.  World leaders were educated first hand about the history and key issues.  Along the way, the process revealed itself to be so flawed in many respects that no one can disagree that more nimble approach is now required.

If leaders waste no time to build upon the breakthroughs, personally engaging in bilateral talks, Copenhagen will be seen in hindsight as a “teachable” moment on the way to a true agreement.

The crucial breakthroughs began even before the curtains were raised when a number of countries made new pledges to limit their GHG emissions, including some that had never before done so like China, India, and Brazil.  While one might have hoped that these pledges were even more ambitious than they were, we can’t forget that these were initial negotiating positions.  So, we now know the bare minimum that these countries are willing to do, and we can assume that with a little give and take, they might do more.

Similarly, thanks to the leadership of the UK’s Ed Miliband, Europe took the crucial step of putting a material sum of money on the table to help less well off countries with their transition to a low-carbon economy and adaptation to climate changes already occurring.  By finally offering a specific, albeit initial, amount of “fast-start” funding, European countries formally acknowledged for the first time the fundamental need of all countries to develop their economies, with financial support for leapfrogging to cleaner technologies.  Oddly, however, they didn’t ask for much in return.  During the negotiations, other countries upped the total to nearly $30 billion for the initial tranche.  Another surprise was that Secretary Hillary Clinton agreed that by 2020, $100 billion would be needed annually for climate funds, but did not clarify how much the United States would contribute, a gigantic detail not lost on anyone.

All decided for the first time that global average temperatures should not increase above 2°C, which implies deep cuts in global emissions during the coming decades.  In fact, it is possible to derive an emissions budget for the world with this goal now specified. Highly vulnerable countries like the Maldives and Tuvalu advocated a 1.5°C limit instead, which stretched the imagination.

The most intriguing development was on the protections of forests, from which 20 percent of global CO2 emissions are emitted through deforestation.  Why now?  This agreement, known as “REDD+” was proposed originally by Costa Rica and Papua New Guinea.  Now that monitoring and verification technologies have improved enough so that conservation efforts can be assessed, Norway and the United States volunteered money to support it. Brazil’s President Luiz Inacio Lula da Silvas’ views evolved to the point where Brazil could accept compensation for forest protection, and the pieces fell into place.  Many details need to be worked out so that the program has integrity, but it was an unexpected and welcome step forward.  Sadly, the deal was scrapped when the broader package fell apart, but there is no reason why it cannot be quickly reconstituted.

Perhaps the best thing about Copenhagen is that world leaders became personally acquainted with the tough issues, directly and seriously negotiating for the first time.  It was idealistic to expect that they would be able to resolve their differences through a series of chaotic and ad hoc meetings at the 11th hour.   In his hours in the Bella Center, President Obama quickly identified the core elements of the package – emission reductions, financing, and verification.  He no doubt got an earful from his counterparts about the many American promises made and broken on the long road of climate diplomacy.  Obama returned the favor during his speech, lecturing about the need for transparency and verification. Because of Congressional constraints, however, President Obama didn’t have any leeway to actually negotiate on two of the three core elements of the package: emissions reductions and financing.  Other countries, especially China, knew his constraints perfectly well, and naturally they dug in on the third issue: monitoring and verification.

The contours of the eventual deal are now much more clear. Developing countries need to see that all industrialized countries, including the United States, will actually reduce their emissions.  Deeper cuts would be nice, but it’s likely that everyone would be relieved if they just got on with it.  Major developing country emitters need to commit to binding emissions limitations in exchange for financing.  Again, more stringent initial targets would be preferable, but that would require more financing. In exchange for the provision of financing for clean technology deployment, developing countries need to open their markets so all firms, including those from industrialized countries, can fairly compete for clean energy business in these markets.  Least developed countries need more aid for adaptation. Finally, all countries need to agree to a fair system of verification.

We need a leader to push forward at this point. Someone needs to shoulder responsibility for brokering a deal, starting tomorrow, to build on the momentum begun at COP15.  Brazil’s President Lula springs to mind because he is respected in the developing world, is a mediator, and cares about both environment and development.  Alternatively, President Calderon is hosting the next conference of parties and is not afraid to generate creative ideas such as the Green Fund.  Such mediators need to go from capital to capital for serious consultations.

Meanwhile, Premier Wen and President Obama need to directly talk again, and soon.  If the U.S. and China can break their impasse directly, it will be infinitely easier for the Congress to pass legislation and unlock the whole international process.  When the Senate does pass legislation, it must not only focus on reducing emissions, but also on how to contribute to the international climate funds.

If the core elements of the deal are agreed upon at the highest levels, it is conceivable that many of the unresolved details will be rapidly and agreeably ironed out at the next meeting of the climate convention in Mexico City.

Kelly Sims Gallagher is associate professor at Tufts University’s Fletcher School of Law and Diplomacy and a senior research associate at Harvard Kennedy School’s Belfer Center for Science and International Affairs.

It’s the Process, Stupid!

By Mukhtar Amin, with contributions from Kelly Sims Gallagher

After a two-year process and a final two weeks of marathon negotiations, the much- publicized climate change conference in Copenhagen concluded with a vague and anticlimactic political statement that has left most people confused. The agreement—a three-page document dubbed as the Copenhagen Accord—does not commit the industrialized nations or emerging economies such as China to firm targets for midterm or long-term CO2 reductions.  Nor does the accord require member states to complete the negotiations with a legally binding treaty at its next COP meeting in Mexico City next year. More than lack of political will, or any other factor, it was the process that undermined substantial progress being made in Copenhagen.

By most accounts, the outcome of the Copenhagen negotiations fell substantially short of even the most modest expectations, with some declaring it a complete failure.  As the 119 heads of states and hundreds of negotiators that participated in the conference leave Copenhagen, the question that is on the minds of most analysts and observers is why a conference of such high profile fell so far short of even the most modest expectations.  Was it lack of political will at the negotiating table, mistrust between the parties, or something entirely different that precipitated the anticlimactic outcome of the negotiations?

The first procedural and tactical mistake was the decision by the host country to draft a secret draft text that excluded the Group of 77 (G77) developing countries.  Desperate to produce a deal and worried that the meeting in his country may end in failure, the Danish Prime Minister ignored how destructive it would be to focus on a small group of developed countries so early in the process and ignore the majority of the world.  The outcome may have been different if this text stayed secret, but it was leaked to the Guardian newspaper and the talks never really recovered from the anger and distrust that the leaked text created.  The developing countries felt that they were ignored before the negotiations even began, and as a result insisted on changing the process of the talks.  Indeed, almost two full days of crucial time was lost to a debate about which draft text to work from, how much time each Working Group would have to finish its work, and other such procedural matters.

The Danes appeared to be so focused on engaging the United States that they lost sight of the big picture, and especially how angry developing countries would be if they felt they were being ignored in the one institutional setting where they have a voice.  To alienate the largest emitter in the world, China, was a colossal strategic error.

The organizers of the conference made the mistake of registering 45,000 participants for a conference center that holds 15,000 people.  Since official government delegates could not be turned away, this meant that most of civil society – NGOs, academicians, and others—were locked out of the conference center.  The result was not only a deep anger and frustration for those who traveled thousands of miles only be locked out in the cold, but it was also a major loss for the discussions inside the Bella Center.  As experts who have studied the issues longer than many of the delegates, civil society groups have often played a crucial role in climate change discussions.  Even more important, NGOs are indispensable resource for least developed countries that heavily depend on the expertise and resources of NGOs for negotiations.  To turn away a group that is so important to the process underestimated their importance and ultimately contributed to the unimpressive outcome of the negotiations.

On a purely logistical level, the process was an unruly, unpredictable, and infuriating mess, with some heads of delegations reporting that guards physically blocked them from entering the plenary.  The metro stop at the Bella Center was frequently shut down so negotiators had to trudge miles through cold and snow from remote locations past checkpoints of muscular Danish politi. Dozens of countries were not adequately consulted during the development of negotiating texts, and multiple days were wasted listening to Presidential public speeches (mostly rants and entreaties) that could have been devoted to some old fashioned face-to-face talking among top leaders.

In the end, as the dust begins to settle and people start to try and figure out what went wrong or right in Copenhagen, it’s likely that most will point fingers at which countries obstructed the talks and which countries did not.  Little will be said about the process, and the extent to which it hindered progress in Copenhagen. If the ultimate goal is to learn lessons from Copenhagen, it would be wise to start analyzing where the process went wrong and how it could be improved in the future.

UNFCCC Secretariat and Danish Government, You Should Apologize to All NGOs

Hengwei LIU

The 15^th Conference of the Parties (COP-15) of the United Nations Framework Convention on Climate Change (UNFCCC) taking place at Bella Center in Copenhagen, Denmark, commenced on December 7th, 2009, and adjourned some two weeks later on December 18th. Its original purpose has been to reach a new international agreement on climate change to come into force when the Kyoto Protocol’s first commitment period comes to an end in 2012.

After two tumultuous weeks of sessions involving 193 countries, leaders from the United States, China, India, Brazil, and South Africa came to an agreement named ‘Copenhagen Accord’. While the accord is reached, many vital details remain to be defined in the following year. The ‘deal’ is far from perfect–and a long way from what had hoped for–but it is a start. ‘For the first time, all major economies have come together to accept their responsibility to combat climate change,’ said President Obama, after a raucous all-day session of emergency negotiations in Copenhagen. ‘This is a consensus that will serve as the foundation for global action against climate change for years to come.’  Credit should be partly given to the Danish government and its leadership and the UNFCCC Secretariat, who have worked tirelessly for a long time to prepare for the negotiations at COP-15 in Copenhagen.

Here I do not want to comment much about the ‘deal’ or give more praise to the organizers. Now I want to turn to the other aspect–the shocking logistical failure in Copenhagen–the organizers denied access to thousands of the registered COP-15 participants!

The Article 7, paragraph 6, of the UNFCCC duly provides for the admission of NGOs to sessions of the Convention bodies as observers: The United Nations, its specialized agencies and the International Atomic Energy Agency, as well as any State member thereof or observers thereto not Party to the Convention, may be represented at sessions of the Conference of the Parties as observers. Any body or agency, whether national or international, governmental or non-governmental, which is qualified in matters covered by the Convention, and which has informed the secretariat of its wish to be represented at a session of the Conference of the Parties as an observer, may be so admitted unless at least one third of the Parties present object. The admission and participation of observers shall be subject to the rules of procedure adopted by the Conference of the Parties.

Knowing the Bella Center could accommodate at most 15,000 persons at any one time, the organizers approved about 43,000 observers from official, accredited organizations around the world. The result is that thousands of participants – including not only NGO representatives, but also government negotiators – stood in line outside of the Bella Center in the bitter cold waiting about 2 hours in the first week and 10 hours in the second week to get inside to receive their credentials.  Thousands of others never got inside, despite having waited up to 8 hours, standing in the cold. Moreover, many side events will be holding in Bella Center have to be cancelled.

Same chaos also occurred at the Central Station of Copenhagen at the evening of Dec 17, many trains delayed, and no one knew when the trains will come and which track will be used. In this station, I cannot find any volunteer of COP-15.

There has never been such a chaos in the UNFCCC conference history. No doubt, both the UNFCCC Secretariat and the host, Danish government must share the responsibility for the logical failure.

Not as expected

This week did not quite turn out as expected. Why? For one reason, despite taking place in Denmark – a rather well-run country – the organization of the conference was chaotic at best, and catastrophic at worst. On our arrival Monday afternoon, when we sprinted to the Bella Conference Center right after getting off the airplane, we were turned away by security with dozens of other people. No more registrations that day, we were told.

But it was the next day that was far beyond unbelievable. Knowing that we wouldn’t be the only ones wanting to enter the Bella, we left our hotel 5.40am only to find a queue of many hundreds if not thousands of people.

Endless freezing

After enduring a very, very long seven hours in freezing temperatures with other researchers, advocacy group members, officials from IOs… I finally made it inside the Center – just to spend another hour in line to pass security and receive the photo-badge. Luckily I had a “secondary pass”, the little card needed in addition in order to gain access – what a system… Had it not been for the Danish soldiers, serving coffee and tea and for the vegan activists handing out sandwiches the wait would have been unbearable. Once through the ordeal I first had to recover my strengths with a late lunch at very pleasant (body-thawing) room temperature.

Being already late in the afternoon at that point, I was excited to at least be able to conduct an interview with a representative from the German renewables industry. He went into detail about how the industry is organized and the channels it uses to influence policy. The basic statement: the industry is ready for a large-scale transformation towards renewables – all it needs is the right policy.

Inside, the enormous Center was organized in a series of areas. The exhibit area, where organizations of all sorts had set up information stands, was mostly abandoned at this time of the day, frustrating my objective of interviewing experts there. In the corridor towards the next area some activists dressed in black suits with black glasses were throwing fake $-bills with Sen. Inhofe’s face on them and speaking in a deep, sarcastic voice, denouncing coal industry lobbying. Past a café and the official documents desk emerged another area. In this huge nicely decorated hall, a flurry of delegates, journalists, NGO reps… were sitting and rushing around. One interesting sight was a politician being interviewed by a polar bear. Beyond that layed the main plenary, the enormous press center and the many, many work group, meeting and side event rooms. Although people were still only being let in very slowly, inside it didn’t feel crowded at all, although not empty either.

Also unexpected was the severe restriction of non-governmental badge carriers for the rest of the week. This category comprised not just all sorts of NGOs but also business reps, journalists (that didn’t get journalist accreditation) and researchers like us. The following day (Wed), I didn’t even head to the Bella, having heard that access was virtually impossible. For Thursday and Friday the number was reduced to a staggeringly tiny 300 – out of 25,000 accredited! This is unprecedented in UN conference history and was vehemently criticized by the NGOs. They saw it as a disrespect of the fundamental right of civil-society participation. (A side effect: influential non-govs, e.g. some businesses, being moved onto country-delegation lists to get in.) At least one positive thing can be seen in the overcrowdedness: The world has come to a point where climate change policy is an issue that does not fit in one conference center!

Unexpected alternatives: civil society

A last minute shaming action

Unexpectedly being able to spend only a few hours in the official Bella Conference Center during the whole week, I had to find other venues. One overall interesting one was the KlimaForum – “The People’s Summit”. Here, in the center of town, a very different atmosphere reigned. It was basically another universe. I felt *slightly* overdressed with my suit among the many civil society reps and grassroots activists from all over the world. Here one could hear vivid discussions in the hallways, pick up all sorts of info material of many shades and eat great, cheap organic food. On the program was a multitude of events and workshops on every imaginable issue related to climate change. The reason why this was another universe was already expressed in the slogan of the Forum: “System change, not climate change”. Here market mechanisms (emissions trading) and technology hopes (e.g. CCS) were less seen as the solution; rights-based and reparation (“climate debt” of rich countries) approaches dominated; and concerns for the poor and climate-vulnerable were high (“survival is not negotiable”).

Next to the KlimaForum a NGO convergence space was set up as a Bella-alternative, where the negotiations could be followed live and groups organized events. Last night I witnessed a particularly interesting one, at which various speakers – Bill McKibben of 350.org, an indigenous chief, a 1000 hour climate fasting 25y old girl, an African singer… – convened a candle vigil. (Each of the hundreds of candles represented 10,000 signatories of a climate petition.) As outcome of the negotiations was expected to be quite unsatisfying/a failure, the speakers tried to give inspiration and hope to the attendees (“the first truly North-South global justice movement in history”; “just the beginning”).

"President Nasheed of the Maldives at a 350.org

The past week was one I will definitely not forget! Moreover, getting into the Bella only once wasn’t so bad.  As the whole city was filled with all sorts of climate people, the conference in effect took place all over Copenhagen. Meeting interesting people, researching for my thesis, and expanding my knowledge on climate negotiations and civil society activity made my week. What a week!

Evolution of a Stronger African Coalition

Earlier this past summer, African countries for the first time announced that they would come to Copenhagen as a distinct negotiating bloc.  For those who follow the role Africa has played in international environmental negotiations, this was a major development.  In previous multilateral environmental agreements, African countries traditionally negotiated under the umbrella group known as the G77 and had little visibility in the debate.  In Copenhagen, the still-young negotiating bloc is already showing signs of maturation.

A common criticism that is often made about coalitions from developing countries is that they are good at blocking proposals from developed countries, and not so good at proposing their own solutions.  Indeed, that accusation is quite evident here in Copenhagen, with the US and the EU blaming the G77 and China for stalling the talks (although the G77 is also pointing fingers at the developed countries as the obstacle).

The African Group’s emergence as a distinct negotiating bloc started out with an image that the Group was nothing more than a “blocking” coalition.  In November, the Group stunned other delegates when the African negotiators walked out of talks in Barcelona and brought the discussions to a halt. The African delegation explained that they were frustrated by the developed countries’ refusal to commit to substantial emissions reductions and come up with major funding for adaptation and mitigation.  Almost the same drama played out here in Copenhagen again earlier this week when the African coalition threatened to leave the negotiating table over the same objections that they had raised in Barcelona.

But the African Group realizes that complaining alone will not advance their interests, much less win them new friends.  That is why the Group teamed up with France a few days ago and came up with a proposal that was well received in the Bella Center.  The new proposal aims to resolve the sticking points that have divided the developed and developing nations.  Among other things, the proposal calls for:

• Halving global CO₂ emissions by 2050 compared to 1990, and by extension that developed countries reduce their emissions by at least 80%.  The proposal is silent on midterm targets, probably because the African Group and the French could not agree on a specific number;
• Strong commitment on long-term financing for mitigation and adaptation in developing countries.  These funds would be in the tune of $100 billion by 2020.
• A “fast start” fund between 2010 and 2012 in the amount of $10 billion per year.  The proposal states that 40 percent of these funds should go to adaptation projects in Africa;
• Create a high-level expert group within the UNFCCC system that will administer the “fast start” funds and the long term financing funds.

The African and French initiative is beginning to gain momentum, with Hillary Clinton announcing that the United States would be willing to support this financing scheme.  This is the first time that the US has backed such a fund, and it shows that the African Group has been successful in influencing the US to go along with this proposal.

But it is also important to point out that not all African countries and NGOs are happy with the deal that the lead African negotiator, Prime Minister Meles Zenawi, cut with the French.  Some countries like Nigeria are unhappy that the Group accepted a $100 billion by 2020 and see the 10 billion amount in the “fast start” fund as inadequate for adaptation and mitigation needs in developing countries.  The Pan-African Alliance for Climate Justice also criticized the deal as not encompassing the interest of all Africans.  But at the end of the day, a coalition as diverse as the African Group will always have some internal differences.  The key point is that they have been able to stick together as a group, and that there presence is beginning to be felt more than ever before. In the Bella Center and in other parts of Copenhagen where climate change talks are talking place, the Africa Group is being talked about more than ever before.

For the African Group, time will tell if becoming a distinct coalition of their own is better than allowing the G77 to define their positions, but for now it is fair to say that the young African coalition is showing sign of maturation. — Mukhtar Amin

The Kyoto Surprise Revisited

In the final hours of the Kyoto Protocol talks in 1997, when negotiators were as tired and grumpy as they are sure to be tonight and tomorrow, the parties struck a compromise for financing emissions reductions called the Clean Development Mechanism (CDM).

The CDM was called the “Kyoto Surprise,” and most of my week here in Copenhagen has been spent tromping through the snow to track down NGOs and interview partners who are debating how the surprise will weather its adolescence in the new climate architecture.

The CDM provides opportunities for industrialized countries with emission-reduction commitments to finance and implement emission-reducing projects in developing countries. Such projects earn saleable Certified Emission Reduction (CER) credits, which industrialized countries can count towards meeting their Kyoto targets.

The nitty gritty of the system is a labyrinthine bore, but the social effects on communities where these projects take place are crucially important. This was the focus of my research this summer in India, where communities of wastepickers and informal recyclers, some of the poorest citizens in the country, have been thrown into competition for garbage with CDM-funded waste-to-energy incinerator projects. It was excellent for me to see that the wastepickers held an official side event here during the first week of the negotiations. Watch the webcast of the event from the UN site.

Here’s the rub: the basic requirement of any CDM project is that it provides cost-effective emissions reductions and sustainable development benefits. Kyoto never defines sustainable development, but it is commonly understood to involve environmental, social, and economic dimensions. The CDM executive board must sign off on all emissions reductions, but it is host country governments, not the executive board, who determine whether or not a project contributes to sustainable development.

I’m beginning to realize that one of the most beguiling aspects of CDM reform is to find ways to develop and implement criteria, best practices, and oversight for the social dimensions of these projects, so that the environmental and economic aspects (the “cost-effective emissions reductions”) don’t fall victim to their own success.

One of the few places I’ve seen this happening is in the voluntary carbon markets. Tonight I attended a discussion with some voluntary carbon standard organizations such as Gold Standard and Social Carbon (after which I saw Al Gore marching through the hotel with a gaggle of hangers-on). These organizations are ahead of the UN on this one, perhaps because they are owned by NGOs.  When I ask how the sustainability matrices they’ve developed for their carbon credit verification systems might be mainstreamed into the CDM project approval process at the country level, I’m met with sympathetic shoulder shrugs and business cards.

This all assumes, of course, that reform is preferable to just chucking the CDM into the North Sea. Last night, a slightly drunk Scotsman leaned over his Grolsch to remind me that since the CDM was developed to bring incremental financing for technology upgrades and to get new projects over barriers in existing frameworks, it is by definition not going to lead to the kind of innovative thinking and bold action needed to shift our economies onto cleaner paths and achieve deep and lasting cuts in emissions.

Depending on who I’m speaking with, the CDM has either been a success because it has channeled billions of dollars to clean development in poor countries, or an exploitative failure because of its capricious and secretive executive board, geographical inequality, dubious emissions reductions and questionable contributions to sustainable development. CDM reform seems to be a given, but the draft texts that came out of the working groups yesterday showed only incremental improvements and planted a few new landmines.

One positive development in recent days is that there seems to have been a new category created, identifying developing countries that have less than 10 CDM projects. The number 10 is rather arbitrary, but in an effort at more equitable distribution (the vast majority are currently hosted by China and India), the text gives a boost to countries with few projects by 1) simplifying the methodologies and approval processes for small projects that are more likely to occur in these countries; 2) offering to delay the registration fees by granting loans that are later repaid from the carbon credit revenue; and 3) mandating that 10% of the credits purchased by industrialized countries must come from the under-10- club of developing countries.

Unfortunately, the texts are also considering whether or not to include carbon capture and storage (CCS) projects and nuclear energy projects in the CDM. Both are pretty terrible ideas. In a CCS project, carbon is captured at a power plant, liquefied, and then injected deep underground into geological formations. (Ironically, the best spots are depleted oil fields). The technology is lauded in wealthy countries, but few demonstration projects have been undertaken because of the prohibitive cost and fears about the safety and permanence of geological storage. Would an earthquake belch it back up? So if CCS is included in the CDM in the new agreement, it would provide a way to test the technology in low cost settings, but it would essentially make poor countries the guinea pigs for CCS demonstration projects. Duh.  Ditto with nuclear.

In my estimation, neither of these project types are going to make it through the weekend, but pressure on the CDM executive board for their inclusion will certainly continue down the line. Yet if they are explicitly shot down, it would be a victory for the NGO and activist community who has been pushing for a CDM Blacklist for some time.  In addition to CCS and nuclear, they’d like to see large hydropower, coal, and waste incineration on that list.

The Kyoto Surprise is growing up, and so the fight begins about how to discipline this unruly kid.

Side events by IETA

Given the difficulty entering the Bella Center, I’ve positioned myself for most of the conference down the street at the Crown Plaza where the International Emissions Trading Association (IETA) is putting on a full week of side events about carbon markets and the future of regulatory systems at both the national and subnational levels.  In contrast to the KlimaForum, another off-site venue attracting a range of NGOs including human rights leaders and activists concerned with climate change, the IETA event feels diametrically opposed, focused almost entirely on and represented primarily by the private sector.  But while I find both perspectives very important, I decided on the IETA events as my main area of research concerns emission trading.

Holding the coveted "secondary" badge

The first panel I attended discussed China’s newly developed Panda Standard, the first domestic market ever to be established in China that specifically focuses on the agriculture and forestry sectors.  These sectors largely affect the rural and poorer areas of China in the western part of the country that has not benefited from foreign capital coming into China through international offset projects under the CDM.  This market looks to be very successful due to its partnership with BlueNext, one of Europe’s largest and most effective carbon traders, and the support of China’s National Development and Reform Commission, China’s largest and most influential ministry.

My biggest doubt about this market is who are the buyers for these credits?  One speaker on the panel claimed demand would come from companies in China looking to support the rural sections of the country while making their operations carbon neutral.  I am unsure if Chinese companies will be motivated to invest much into this voluntary market, especially when China will most likely need to meet mandatory reductions in intensity of greenhouse gas emissions.  Some ministers have suggested that finding a way to make these voluntary emission reductions (VERs) compatible with certified emission reductions (CERs) would result in much demand.  But no mechanism currently exists for merging VERs and CERs into the same market as these two standards are fundamentally different. The path to make China’s Panda Standard viable still has many hurdles to overcome, but should be interesting to watch its future developments.

Another presentations included the private sector’s hopes for the regulatory environment that will be established by the UNFCCC and other governing bodies, progress on the American “smart grid”, adaptation measures in the United States, and innovative ideas about the scope and scale of carbon markets, including the registry of black carbon as a greenhouse gas.  Overall the conference provided a lot of very valuable information but was very American focused.  I learned one reason for this is due to the conferences sponsorship with The Climate Registry that has its roots in California. Nonetheless I greatly enjoyed the range of questions coming from audience and talking with other participants in between meetings and look forward to continuing these conversations at the reception starting in a few minutes.  I will definitely keep tabs on future IETA developments and its work with carbon markets.