Climate Change: There is Life After Copenhagen

IMGXYZ2325IMGZYXGovernments, academics, and NGOs are still digesting the results of the Copenhagen Summit and devising ways to move forward on the climate change agenda. To address this pressing issue, Carnegie sponsored the fourth Twenty Roundtable meeting, encouraging dialogue among Washington’s senior diplomats around three key questions:

• What is your evaluation of the Copenhagen outcome?
   
• What can we expect to happen now?
   
• Do we need a new approach in order to move forward?

Participants largely agreed that progress was made in Copenhagen, but also noted significant shortfalls. Participants also felt that work should continue both in the UN universal forum and among smaller groups (e.g. large emitters).Some discussants prioritized the former for reasons of legitimacy and inclusiveness, while others highlighted the latter on considerations of effectiveness.

Progress and Shortfalls

• The Copenhagen Summit got all countries to put their cards on the table, and the resulting Accord succeeded in including both developed and developing countries. In addition, the Accord called for a 2 degree Celsius maximum temperature rise, a step forward from past agreements, and the financial aid offered to assist developing countries was better than anticipated after the G20 meeting in Pittsburgh.
   
• At the same time, the commitments offered during the Summit are still not enough to prevent potentially catastrophic climate change. Some participants questioned whether a bottom-up approach—with individual countries offering cuts and then aggregating them to measure the global change—rather than one global target would ever lead to sufficient cuts. Estimates suggest that current commitments would result in a 3.5 – 4 degree Celsius temperature rise.
   
• Participants disagreed on whether or not the high expectations that preceded the summit were a good thing. Some felt they had been too high—particularly for the United States, where work on climate change only began in earnest with a new administration 11 months ago—and fed disappointment following the Summit.

Moving Forward: Should We Look to a Global Deal?

Participants highlighted the extraordinary complexity of the climate change issue, and recognized that the UN forum is a particularly difficult one in which to address it.

• The Complexity: The tensions that exist between high-income, low-emitters and low-income, high-emitters—which play out across regions within individual countries, just as they do on an international level—always lead to a lowest common denominator outcome. In the United States, progress, led by “green,” high income states, is hampered by states with energy-intensive sectors, just as progress on an international level, led by a few rich countries, is limited by poorer, higher emitters. The larger the variety of perspectives involved, the harder the negotiation and, often, the more limited the outcome.
   
• Arguments for the UN Forum: Nonetheless, some participants prioritized reaching a global treaty, arguing that climate change—a global problem—must be dealt with in a global, inclusive forum. One participant argued that treaties are not pursued solely to achieve maximum results, but instead to signal intentions and establish a sense of common ambitions. Another stated that ending the UN process would lead to a moral crisis.
   
• Arguments against the UN Forum: Others pointed to the extraordinary difficulties of getting 193 countries to agree on such a complex and divisive issue, and wondered whether the negotiations would not bear more fruit if pursued in another forum.

Whatever track is pursued, a leader—or group of leaders—must emerge.

Alternatives to a Global Forum

Recognizing that a much smaller forum—one on par with the G20, for instance—could bring all major emitters to the table, participants considered both existing and new groups. However, some argued that, before any international coordination can occur, countries must line up their domestic constituencies and show real autonomous progress.

• The Smaller Forum Model: Some participants argued that the G20 cannot take over the climate change agenda because it lacks the necessary expertise; however, it can consider the relevant finance issues. Following this division-of-labor logic, one participant suggested that the Major Economies Forum (MEF) take on the technology discussion and the UN then consolidate the agreements that result from both smaller forums. Another suggested that discussions continue in a MEF-like forum that also includes several nations particularly vulnerable to climate change. 
   
• The WTO Model: One participant pointed to the failure of the G20 and the MEF to deliver much so far on climate change, arguing that countries must establish domestic positions before they can move on to other forums. Other participants agreed that, as they did in the GATT/WTO process, countries should first address domestic issues and take unilateral steps—though participants differed on whether or not those should be binding.
   
• The EU Model: The EU’s unified position on climate change suggests that important divisions among a smaller group of countries or among regions in a country (as in the United States) can be overcome. Participants explained that the EU’s success is largely a function of its institutions—which enable it to package different issues together, allowing countries to trade gains in one area for sacrifices in another—as well as the strong pressure its public and NGOs put on leaders and the bold actions those leaders take. At the same time, one participant noted that the EU still lacks internal consensus on key international policy questions, such as how the finance commitment resulting from the Accord will be distributed and whether or not the region will increase its emissions reduction commitment to 30 percent.
   
• Action By “Green” Countries: Another participant argued that the high-income, low-emissions “green” countries, which also have a higher willingness and capacity to pay for climate change efforts, should step up their actions by creating cross-subsidy arrangements, collaborating on mutually beneficial research, developing cap and trade regimes, or levying carbon consumption taxes.

Do We Need a Paradigm Shift?

One participant argued that no dramatic change will occur until the climate change paradigm shifts from one of allocating pain to one of sharing opportunities (“the green economy”), while others questioned whether such a change is feasible.

• Some argued that, while opportunities exist, they are not large enough to offset the costs. Others recognized that, even if a net benefit is possible, the necessary adjustments will result in a set of both winners and losers.
   
• In order to stay within the two degree Celsius temperature increase target without sacrificing growth, the productivity of each unit of carbon must rise by 15 – 20 percent.

Remaining Issues

A gulf needs to be bridged on several crucial issues. Some, like setting a U.S. emissions target, by their nature depend on national processes, while others, like credible mechanisms for the transfer of technology and finance, require international agreement.

• The United States: Congress is hoping to pass a bill that sets an emissions target by spring. Clearer signals on the bill’s progress should emerge in the next six weeks. The President’s upcoming State of the Union Address will define the priority given to climate change by a busy administration.
   
• The Developing World: Another participant raised the question of how negotiations should account for the fact that some 1.6 billion people in developing countries have no electricity, and highlighted the importance of maintaining common but differentiated responsibilities. Nor does the existence of green technology mean that it can and will be adopted in the developing world. For a green technology revolution to occur in developing countries, technology must be made available and affordable.
   
• Financing: Mexico, the next COP host, intends to make financing the focus of the summit, something several participants saw as a blessing. Many finance options have been put on the table, but the current economic climate has prevented countries from taking action, or perhaps provided an alibi for inaction. One participant suggested that, as the economic crisis recedes, countries will have to come forward with commitments.
   
• Technology: Technology—and its price—also remains a key issue. One participant argued that new technology can only drive change if its price is competitive with the low price of natural resources. The problem is that the market price of depletable energy does not reflect its social cost. Participants discussed the feasibility of a carbon or increased gas tax in the United States. While most agreed that neither is politically feasible, one argued that, as the government is forced to find new sources of revenue in the coming years, a carbon tax may emerge as the best option. Noting that it may already be too late to limit climate change by curbing emissions, one participant highlighted the need for developing technology that captures and stores carbon as well.