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CoP-6 President's text 11th & 19th June 2001 A quantitative analysis
by Malte Meinshausen and Bill Hare
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report
Executive Summary
The "Consolidated negotiation text proposed by the President" (1) (11th June 2000) has been analysed in terms of its estimated affects on allowed emissions of fossil fuel and other industrial GHG emissions to the atmosphere during the first commitment period 2008-2012 of the Kyoto Protocol.
The two main issues examined here in quantitative terms are that of the sink (Land Use, Land Use Change and Forestry) provisions and of the trading of the Russian surplus or "Hot Air". Three scenarios have been used to examine the implications of the President's proposals - full participation by all Annex B Parties, non-ratification by the USA and non-ratification by the USA, Australia and Canada.
The starting point for the analysis are the already adopted provisions of the Kyoto Protocol in Articles 3.5, 3.7 and 3.8. Whilst the Protocol has a nominal target of a 5% reduction in emissions relative to 1990 by 2008-2012, already adopted provisions reduce this to around a 3% reduction for the Annex B group as a whole. For the OECD group of countries within Annex B of the Protocol these provisions degrade the target from a 6.4% reduction to an effective 4.7% reduction.
In the case of full participation by all Annex B Parties the inclusion of sinks under Articles 3.4, 6 and 12 is likely to result in an increase in the allowed emissions in 2008-2012 of about 3.6%. This would result in an overall emissions increase of about 0.6% above 1990 levels. For the OECD group of countries in Annex B of the Protocol, there is likely to be an increase in the allowed emissions by about 3.9% due to the inclusion of sinks. This would reduce the effective target from a 4.7% reduction to about a 0.8% reduction relative to 1990 emissions (see Table 1).
No restriction on the sale or purchase of "Hot Air" (Art.17) would, if all available "Hot Air" emission allowances are sold, result in a substantial increase of emission allowances for OECD countries within Annex B. This would result in allowed emissions of this group being 6.5% to 9% higher, leading to emissions being 5.3%-8.1% higher than 1990.
Whilst this is already unacceptable in environmental terms the most worrying result of this analysis relates to the scenarios wherein the USA or the USA, Canada and Australia do not ratify the Protocol.
In this case of the USA not ratifying, the availability of "Hot Air" would completely nullify the emission reduction targets of the remaining OECD countries in Annex B. The allowed emissions of the remaining Annex B countries would be 72 to 125 MtC/year above business as usual emission (BAU) projections - see Table 10). This effect is even more pronounced if Canada and Australia join the USA in not ratifying the Kyoto Protocol, with allowed emissions being some 25 to 150 MtC/year above BAU projections.
This analysis has not looked at the issue of the Clean Development Mechanism in the President's proposals. Credits from CDM projects add to the allowed emissions of the Annex B Parties, and hence would tend to exacerbate the results described here. The high relative availability of "Hot Air" would likely exclude any significant CDM market developing, nevertheless it needs to be noted that the baseline and additionality proposals in the President's proposal are relatively weak. This would result in large volumes of cheap CDM project credits being attainable in principle with only weak tests as to the true additionality of these projects.
It is clear from this quantitative analysis and in light of the current US position, that the issue of "Hot Air" and sinks has reached a critical point. Whilst previously a defence was made against arguments for the control of "Hot Air", largely by the Umbrella Group members, that there still would be the need for emission reductions this is clearly no longer the case if the US does not ratify. The Russian Federation has insisted that this issue not be controlled, however it must review its position in the light of this evidence.
A further issue arises in relation to the boundary conditions on the sink or Land Use, Land-Use Change and Forestry (LULUCF) provisions proposed by the President. It is proposed that all LULUCF activities falling under Article 3.4, 6 and 12 be limited under a cap, however this cap does not apply to afforestation, reforestation and deforestation activities under Article 3.3. This exemption would result in Iceland's target increasing by +8.4%, Ireland by +6.3%, and New Zealand by +40% relative to 1990 emissions. This could become disastrous in the light of tremendous uncertainties regarding potential Art. 3.3 credits from Russia, and other countries, for whom little or no reliable data on afforestation, reforestation and deforestation (ARD) exists in the public domain. It is imperative that Article 3.3 activities be placed under any overall boundary condition for sink activities and that this condition be made as small as possible.
The choice is clear: Either "sinks" and "Hot Air" have to be dramatically reduced below levels proposed by the President in the current text (if not excluded completely) or the Kyoto Protocol will most likely be ineffective in terms of reducing emissions to the atmosphere.
As a legally binding framework to control greenhouse gas emissions the Kyoto Protocol is a vital tool. It must however be effective in achieving real emission reductions to the atmosphere. It would be ironic in the extreme if the rules adopted for the Protocol at COPbis were to permit virtually business as usual emissions from Annex B Parties by adopting rules which the USA had long fought for.
(1) Relevant documents for this quantitative analysis are FCCC/CP/2001/2/Add.2 and Add.3/Rev.1, available at www.unfccc.int