What happens when Kyoto runs its course?

What will succeed the Kyoto Protocol is the subject of intense international debate

Montreal — What will take place after the Kyoto Protocol's commitment period of 2008 to 2012 will be the subject of intense international negotiation for years to come, attendees heard today at the COP-11 side event "Canada and Post 2012".

The climate change regime that replaces the much maligned Kyoto Protocol, could take a number of different forms including:

• Implement Kyoto assumes that the current structure will remain and new commitments will be negotiated every five years.

• Change Kyoto would envision renegotiation of some key elements such as a change from absolute targets to rate-based targets or a safety valve price cap on the price of carbon.

• Parallel Kyoto assumes that some countries or groups of countries will proceed with implementing Kyoto and other countries and groups of countries will adopt a different approach.

• Integrating Kyoto argues that the climate change issue needs to evolve from a discrete environmental issue into one that is more effectively integrated into energy and natural resource management considerations.

The audience also heard international experts representing South Africa and Russia - the latter being the critical linchpin in bringing the Kyoto Protocol into force and the former representing a critical force in framing developing country responses to the threat of climate change.

"Russian officials and business circles should recognize that only strong obligations and a strong "cap-and-trade" system are profitable for Russia," according to Alexey Kokorin from WWF Russia. "Russia can meet weak commitments or a system of intensity targets, but if so, there will be no chance of profitable emission trading and additional revenues."

The side event, hosted by the International Institute for Sustainable Development (IISD) heard that the magnitude of emissions reductions needed is unprecedented.

Limiting the rise of the earth's temperature to 2 degrees Celsius, would require cutting 22 billion tonnes of CO2 emissions by 2050, but this would only give a one in sixteen chance of meeting that target.

As an illustration, this kind of reduction would require displacing 2 billion conventional cars for hydrogen vehicles, sequestering carbon from 1400 1GW coal fired power plans and increasing the world's current nuclear capacity by a factor of 10.

"The range of options for a post 2012 climate change regime raises just as many questions as answers," said John Drexhage, Director of IISD's Climate Change and Energy program. "Who will be subject to commitments? Is a global or regional approach more appropriate? What will be the commitment period? What level and type of support should be provided to developing countries?"

"We know we must act and make larger emissions reductions, but how we are going to do that will require some international tightrope walking, and this COP is an important step towards supporting the start of official negotiations," he added.

About IISD

The International Institute for Sustainable Development contributes to sustainable development by advancing policy recommendations on international trade and investment, economic policy, climate change, measurement and assessment, and natural resources management. Through the Internet, we report on international negotiations and share knowledge gained through collaborative projects with global partners, resulting in more rigorous research, capacity building in developing countries and better dialogue between North and South.

IISD's vision is better living for all-sustainably; its mission is to champion innovation, enabling societies to live sustainably. IISD is registered as a charitable organization in Canada and has 501(c)(3) status in the United States. IISD receives core operating support from the Government of Canada, provided through the Canadian International Development Agency (CIDA), the International Development Research Centre (IDRC) and Environment Canada; and from the Province of Manitoba. The institute receives project funding from numerous governments inside and outside Canada, United Nations agencies, foundations and the private sector

IISD has been an active participant in exploring how efforts to stabilize atmospheric greenhouse gas concentrations could take place after 2012, participating in collaborative projects internationally as well as exploring options for Canada.

Current Work in this Area

• Backgrounder on Options for the Post-2012 Climate Regime
  Provides an overview of the various approaches and elements that could be incorporated into a post-2012 climate regime.

• Which Way Forward? Issues in developing an effective climate regime after 2012
  IISD produced "Which Way Forward?," a series of four papers that help frame international dialogue on options for the development of a post-2012 climate regime, focusing on issues of economic growth, technology, the carbon market and adaptation to the impacts of climate change.

• Canada in a Post-2012 World
  IISD has undertaken a qualitative assessment of Canadian and international perspectives on establishing a sustainable, global regime for climate change action after 2012, including an initial assessment of how Canadian sensitivities and perspectives might be received by critical Parties in the global community.

• Developing Post-2012 Climate Regime Scenarios
  Since 2002, IISD has worked within an international consortium of research institutes to explore options for governing climate change after 2012.

Montreal and the Post 2012 Climate Change Regime

Defining the framework for emission reductions post-2012 poses a daunting challenge. In developing this framework, the global community will be asked to choose from among a number of options, which may be broadly characterized as deciding to implement Kyoto, change Kyoto, establish a parallel Kyoto or replace Kyoto.

• Implement Kyoto assumes that the current structure will remain and new commitments will be negotiated every five years.

• Change Kyoto would envision renegotiation of some key elements such as a change from absolute targets to rate-based targets or a safety valve price cap on the price of carbon.

• Parallel Kyoto assumes that some countries or groups of countries will proceed with implementing Kyoto and other countries and groups of countries will adopt a different approach.

• Integrating Kyoto with the energy and natural resource management policy priorities.

In making this decision, the international community will need to address a number of key questions, including:

• Who will be subject to commitments?
  The Kyoto Protocol sets out emission reduction targets to be met by industrialized countries that have ratified this accord; developing countries currently do not have reduction commitments. In a second commitment period, should all developing countries have reduction targets? Should only those developing countries that have met a specified level of prosperity (e.g., China, Brazil, India) be encouraged to meet reduction targets? The topic of who should be subject to commitments is highly controversial and will likely represent the first substantial roadblock in the multilateral negotiations. Without knowing who else is going to be subject to commitments, countries will be reluctant to begin discussing other issues such as future emission reduction targets.

• Is a global or regional approach more appropriate?
  The Kyoto Protocol provides a single, global framework in which emission reductions are to take place. In a second commitment period, consideration may be given to instead establishing regional frameworks in which greenhouse gas emissions would take place. A regional approach could provide the flexibility needed to engage countries like the United States that are currently not participating in the Kyoto Protocol. It could also respond to the different levels of capacity between developed and developing countries. Regional initiatives could be established instead of, or as a complement to, a global regime.

• Should reductions be absolute or intensity based?
  A second commitment period could continue the standard set by the Kyoto Protocol and require that countries meet an absolute emission reduction target—a fixed percentage reduction of their emissions relative to their levels in 1990. Another option is for absolute targets to be set for certain economic sectors. Under this scenario, the cement industry, for example, would reduce its total greenhouse gas emissions relative to its emissions in 1990. Intensity targets set emission reduction targets relative to rate of economic growth. For example, greenhouse gas emissions per gross domestic product or emission reductions per capita.

• Should qualitative commitments based on particular policies and measures be included?
  Qualitative standards would focus on measures that have an indirect impact on greenhouse gas emissions, as opposed to the current quantitative approach in which commitments are based on direct measurement of greenhouse gas emissions. Examples of possible qualitative commitments include requirements to meet particular technology standards; removing subsidies for industries and activities that produce a high level of greenhouse gas emissions; and establishing regional emissions trading arrangements as has been done by the European Union. Setting targets based on qualitative standards is seen by some as an initially effective means of bringing developing countries into the "commitments tent" as it would ask developing countries to commit to policies and measures that complement their other development priorities.

• What should be the legal nature of the commitments?
  The commitments made could be: (a) non-binding, as they currently are under the UNFCCC; (b) binding, as under the Kyoto Protocol, where countries "shall" reduce their emissions by an agreed to amount; or (c) enforceable, in which legally binding commitments also include penalties for non-compliance.

• What will be the commitment period?
  The first commitment period under the Kyoto Protocol is for five years and requires emission reductions relative to 1990 levels. In the future, the commitment period could be shorter or longer and the base year could be changed from 1990. As well the commitment period does not necessarily need to start in 2013, immediately following the end of the Kyoto commitment period. Furthermore, consideration may be given to having graduated commitments, in which (for example) industrialized countries would have a commitment period that begins in 2013 while the commitment period for developing countries could begin in 2018.

• What level and type of support should be provided to developing countries?
  A future global climate regime will need to address the particular priorities of developing countries, particularly if there is a desire for some or all of these countries to take on emission reduction commitments. Donor countries could be expected to provide assistance to developing countries in four different areas: capacity building; technology transfer; adaptation; and the impact of efforts to reduce emissions on countries that are highly dependent on the production and sale of fossil fuels.

From this list, it is clear that there are a number of choices facing the international community. The options presented are also not necessarily mutually exclusive—a new system could include a combination of intensity targets and absolute targets, qualitative measures and support for developing countries. It is expected that one of the key issues that will influence the choices made in the future negotiations around post-Kyoto commitments will be the need to establish a framework for action that will engage the United States. In their absence, it is unlikely that developing countries will also take on emission reduction targets.

Finding a single approach that will address the interests of all countries will be challenging, but it may be possible to construct an acceptable comprehensive policy approach by selecting elements from the various options. In this manner, a framework could be established that provides the best opportunity to gain broad support from developed and developing countries.