Blog
14.March 2008 - 05:05
Differing interpretations – What really happened in Bali
My working week began in Vaasa, where, on Monday, I attended an environmental seminar related to house construction and gave a speech on the theme concerning the challenges behind the EU’s climate change and energy package. The science magazine Nature included an article in this month’s issue, which shows that the emission situation is much worse than has been assumed: the carbon-intensity of the world has been assumed to continue decreasing along with production becoming more efficient: more through less. The basic idea of this is that even though emissions will increase, the production itself will be carried out in a more efficient way, and this is actually one point where the development is going in the right direction. Unfortunately, along with the strong industrial and urbanisation development of China and India, the case has altered. The Science article put forward the same message at the beginning of this year. I will return to this issue a little later.
I flew to Brussels for the evening to attend a dinner party, during which the discussion continued. The Finnish participants, Rautaruukki and Outokumpu, among others, presented their own points of view on the draft directive which concerns a review of the rules for emissions trading. This is really my issue, as I am responsible for the official policy of my group that deals with emissions trading within the industrial committee. The core question is how to prevent the emissions trading system from punishing those industries that are highly exposed to international competition, such as the production lines of aluminium, concrete and steel. Expenses ensuing from emissions trading cannot be added to the world’s market price without weakening their market position.
Satu Hassi, who came to the dinner party later in the evening, was one of those who were willing enough to somehow protect these competition-apt fields, but free emission allowances would be, in her opinion, unwise when we are still waiting for an international agreement. The energy-intensive production would therefore receive the wrong signal.
I would also regard this as wrong, unless the free emission allowances were linked to the efficiency rate of the plants in some way. Naturally, it cannot be so that a ferrochrome production that is emission-rich per production tonne would receive the same allowances as some other production line whose emissions are close to the theoretical minimum. I have supported this approach, i.e. the sector-specific efficiency observation, for the last eight years; in fact I came up with this idea after meeting the representatives of Rautaruukki. Until then, I hadn’t heard anybody propose this. In those days, I named my idea the emissions trading model of the theoretical minimum: only those installations with emissions exceeding this level should have to buy emission allowances, in which case the system provides an incentive for the reduction of emissions.
A common presumption in Hassi’s argument seems to be that the EU would somehow lead the frontiers of climate policy and the others would join in our emissions trading concept, as soon as some results are gained from the Copenhagen Climate Conference of 2009. I am afraid that just this underlying presumption is incorrect. From the Bali Conference onwards, we may very well claim that the focus of climate policy has already shifting from Europe to the Pacific Ocean. The US is about to take the lead in climate negotiations.
Hassi did not believe my argument – “I think that we’ve been at a different conference”, she said. “I mean, the US was booed at.” (I myself have told what happened in Bali in my blog dated exactly four months ago.)
Exactly. It is so superficial to simply say that the US was booed at. It is a part of the climate conference theatre, which is part of the game for the environmental organisations at least – the casting of bad guys and heroes already took place ages ago. But I have come to the same conclusion as Gwyn Prins, professor and researcher of the London School of Economics. The US left the conference as a winner, because it got what it had wanted, a new negotiation track, not the old one anymore. It was the old approach that did not suit the US.
The old approach that was applied by the UN secretariat, Al Gore, the EU delegation and the British government, demanded a stronger and more extensive Kyoto; in other words, new and stricter emission targets that are tightly bound to time limits. However, this approach was abated. Ban Ki-moon, the Secretary General of the UN, foresaw this and his return to the podium interrupted the conference for the second time, just before the decision was to be made. This could be interpreted as his wish to clearly separate the UN view from the general decision arrived at during the conference.
Japan already declared its stance at the beginning of the conference. The country announced that it didn’t want to tie the name Kyoto to an unsuccessful diplomatic strategy. Japan also stated that it supported the continuation of the Kyoto Protocol but underlined quite clearly that the continuation of the agreement must be based on different principles.
Canada decided to support Japan’s policy. This is noteworthy, as Canada has ratified the Kyoto Protocol, but has proven to be unable to achieve its targets. (Last time at the Montreal Conference, Canada reprimanded the US for remaining outside, but as the journalists quite correctly noted, based on Canada’s increased emissions, it is an even worse performer than the US).
India announced that it cannot see a way to obtain an efficient climate policy unless the US is involved and leading the course in question. India declared that it would not follow a climate policy, if the US was not involved. As for China, it turned down the EU’s attempt to negotiate behind the US’ back. This was part of the EU’s strategy, which attempted to pull through a separate agreement with China. Instead, China placed itself outside the UNFCCC (the United Nations Framework Convention on Climate Change). It was exactly this that caused the tears of agony for Yvo de Boer, the Executive Secretary of the UNFCCC. This was the incident that I described in my blog on the Bali Conference.
Hassi insisted that de Boer was moved to tears as he received recognition. It was not like that at all. I was there myself, in the session hall, and saw it all. Hassi was not there anymore. Boer was particularly infuriated by the negotiations, which had been conducted outside the official track, behind his back.
Despite the one-sided interpretation of the European media, the US was not alone at all in its opinion at the Bali Conference. The US departed Bali, stronger than we Europeans had ever wished. Therefore, we cannot automatically think that all the others would join us and our organisation without asking any questions; especially if our organisation is a model which has been handed down from above, i.e. patronising, regulatory and bureaucratic.
If there is a chance to create a basis for an international emissions trading system, I’ll bet that it will be just what I already wanted eight years ago: efficiency-based reviewing. That is why we should choose the same direction.
Published: March 14, 2008
http://www.korhola.com/2008/04/tulkintaeroja-mita-balilla-itse-asiassa-tapahtui/
My working week began in Vaasa, where, on Monday, I attended an environmental seminar related to house construction and gave a speech on the theme concerning the challenges behind the EU’s climate change and energy package. The science magazine Nature included an article in this month’s issue, which shows that the emission situation is much worse than has been assumed: the carbon-intensity of the world has been assumed to continue decreasing along with production becoming more efficient: more through less. The basic idea of this is that even though emissions will increase, the production itself will be carried out in a more efficient way, and this is actually one point where the development is going in the right direction. Unfortunately, along with the strong industrial and urbanisation development of China and India, the case has altered. The Science article put forward the same message at the beginning of this year. I will return to this issue a little later.
I flew to Brussels for the evening to attend a dinner party, during which the discussion continued. The Finnish participants, Rautaruukki and Outokumpu, among others, presented their own points of view on the draft directive which concerns a review of the rules for emissions trading. This is really my issue, as I am responsible for the official policy of my group that deals with emissions trading within the industrial committee. The core question is how to prevent the emissions trading system from punishing those industries that are highly exposed to international competition, such as the production lines of aluminium, concrete and steel. Expenses ensuing from emissions trading cannot be added to the world’s market price without weakening their market position.
Satu Hassi, who came to the dinner party later in the evening, was one of those who were willing enough to somehow protect these competition-apt fields, but free emission allowances would be, in her opinion, unwise when we are still waiting for an international agreement. The energy-intensive production would therefore receive the wrong signal.
I would also regard this as wrong, unless the free emission allowances were linked to the efficiency rate of the plants in some way. Naturally, it cannot be so that a ferrochrome production that is emission-rich per production tonne would receive the same allowances as some other production line whose emissions are close to the theoretical minimum. I have supported this approach, i.e. the sector-specific efficiency observation, for the last eight years; in fact I came up with this idea after meeting the representatives of Rautaruukki. Until then, I hadn’t heard anybody propose this. In those days, I named my idea the emissions trading model of the theoretical minimum: only those installations with emissions exceeding this level should have to buy emission allowances, in which case the system provides an incentive for the reduction of emissions.
A common presumption in Hassi’s argument seems to be that the EU would somehow lead the frontiers of climate policy and the others would join in our emissions trading concept, as soon as some results are gained from the Copenhagen Climate Conference of 2009. I am afraid that just this underlying presumption is incorrect. From the Bali Conference onwards, we may very well claim that the focus of climate policy has already shifting from Europe to the Pacific Ocean. The US is about to take the lead in climate negotiations.
Hassi did not believe my argument – “I think that we’ve been at a different conference”, she said. “I mean, the US was booed at.” (I myself have told what happened in Bali in my blog dated exactly four months ago.)
Exactly. It is so superficial to simply say that the US was booed at. It is a part of the climate conference theatre, which is part of the game for the environmental organisations at least – the casting of bad guys and heroes already took place ages ago. But I have come to the same conclusion as Gwyn Prins, professor and researcher of the London School of Economics. The US left the conference as a winner, because it got what it had wanted, a new negotiation track, not the old one anymore. It was the old approach that did not suit the US.
The old approach that was applied by the UN secretariat, Al Gore, the EU delegation and the British government, demanded a stronger and more extensive Kyoto; in other words, new and stricter emission targets that are tightly bound to time limits. However, this approach was abated. Ban Ki-moon, the Secretary General of the UN, foresaw this and his return to the podium interrupted the conference for the second time, just before the decision was to be made. This could be interpreted as his wish to clearly separate the UN view from the general decision arrived at during the conference.
Japan already declared its stance at the beginning of the conference. The country announced that it didn’t want to tie the name Kyoto to an unsuccessful diplomatic strategy. Japan also stated that it supported the continuation of the Kyoto Protocol but underlined quite clearly that the continuation of the agreement must be based on different principles.
Canada decided to support Japan’s policy. This is noteworthy, as Canada has ratified the Kyoto Protocol, but has proven to be unable to achieve its targets. (Last time at the Montreal Conference, Canada reprimanded the US for remaining outside, but as the journalists quite correctly noted, based on Canada’s increased emissions, it is an even worse performer than the US).
India announced that it cannot see a way to obtain an efficient climate policy unless the US is involved and leading the course in question. India declared that it would not follow a climate policy, if the US was not involved. As for China, it turned down the EU’s attempt to negotiate behind the US’ back. This was part of the EU’s strategy, which attempted to pull through a separate agreement with China. Instead, China placed itself outside the UNFCCC (the United Nations Framework Convention on Climate Change). It was exactly this that caused the tears of agony for Yvo de Boer, the Executive Secretary of the UNFCCC. This was the incident that I described in my blog on the Bali Conference.
Hassi insisted that de Boer was moved to tears as he received recognition. It was not like that at all. I was there myself, in the session hall, and saw it all. Hassi was not there anymore. Boer was particularly infuriated by the negotiations, which had been conducted outside the official track, behind his back.
Despite the one-sided interpretation of the European media, the US was not alone at all in its opinion at the Bali Conference. The US departed Bali, stronger than we Europeans had ever wished. Therefore, we cannot automatically think that all the others would join us and our organisation without asking any questions; especially if our organisation is a model which has been handed down from above, i.e. patronising, regulatory and bureaucratic.
If there is a chance to create a basis for an international emissions trading system, I’ll bet that it will be just what I already wanted eight years ago: efficiency-based reviewing. That is why we should choose the same direction.
Published: March 14, 2008
http://www.korhola.com/2008/04/tulkintaeroja-mita-balilla-itse-asiassa-tapahtui/