06 November, 2009

Will Copenhagen flop or cope? There is still hope.

With Barcelona just waiting for the final plenary session, all hopes of a breakthrough seem to have already vanished.

Sergio Abranches

Even the most unyielding European leaders now admit that a new comprehensive and legally binding treaty is unlikely to be attained in Copenhagen.

All are now converging towards the  conclusion that the nations should cut a political deal at COP15. A high level political commitment to set the parameters, rules, and the procedural terms for a new treaty to be detailed over 2010.

Is this such a bad outcome as to conclude that Copenhagen is likely to flop? Isn’t there a way to cope with the signs of failure and flip the cards the right side?

The US will be the pivotal actor among the great powers in Copenhagen to this effect. If Obama does get a climate law, he can still make a substantial difference. Even a political agreement would be more credible, deeper and encompassing with a firm commitment from the US, especially if Obama does make it to Copenhagen.

There is an enormous difference between a political agreement negotiated and signed by heads of governments, and one made by diplomats. Diplomats can negotiate treaties. Political commitments are an affair for chief political officers.

I’ve heard questions in Barcelona about whether this political accord would have numbers on it.  I’ve also watched delegates in Barcelona being asked whether what the US Congress is discussing wouldn’t fall too short of what should be demanded from the US. Many doubt Obama could really to take a leading role in the negotiations with such dismal numbers.

They would amount to something between what the House has already approved -17 percent below 2005; 4 percent below 1990;  and what the Kerry-Boxer bill proposed in the Senate – 20 percent below 2005; 6 percent below 1990. Greens and the G77 will probably say it is not enough.

But are these first figures really as important as getting the US in the playing field? I think not.

Obama will be more at easy to discuss financing figures and technological terms, than emissions figures. After years of denial and vetoes at global summits, it is only natural that the politics of a first bill be that hard to tackle. Let us remember that EU’s numbers are relatively new. The first European figures were nothing very impressive either. The US is late. It really is. Blame it on George W. Bush.

More important than the US numbers in themselves would be the breadth of the legislation. If it is able to alter the structure of incentives in the economy, it may trigger investments that will make the R&D pipelines for clean technologies and renewable energy to move faster. It could also stimulate companies to move ahead and go deeper with their sustainability and low carbon strategies, to gain a competitive edge given this new set of incentives.

There is also the demonstration effect to take into account.

It is hard for politicians, under the crossfire of lobbyists, to discuss cost and benefits at an abstract level, or looking at simulations that vary from one set of assumptions to the other. Green lobbyists would show simulations pointing to smaller costs and higher benefits, while the lobbyists for the high-carbon industries would show simulations pointing to high costs and low benefits.

Once the bill becomes law, and companies start acting within the new framework of inducements and constraints it sets, actual costs and real benefits start to show. The correlation of forces among organized interests starts to shift in the direction pointed by the new gains and benefits generated by the new rules of the game. Politicians start to see more clearly what really is feasible, and how to proceed.

This process tends to be fast, depending on how dynamic the economy is. I’d say that in the US it could take from 2 to 5 years. More to the lower end, because of the competitive structure of the economy, the progress already achieved in several states and large cities, and the unique role venture capital has in accelerating R&D in the US.

With the economy already moving in the right direction, these initial targets can be easily overcome and the bar can be set higher at a much lower political cost.

Another important point is that not all the difficulties are related to the US standing. The G77 said in Barcelona it will not support any agreement unless industrialized countries cut their emissions by at least 40 percent below 1990 levels by 2020. That won’t happen. And that is not a necessary and sufficient condition for a global climate treaty to be effective.

Some of the G77 demands are more workable. One of its spokesperson said that “an equitable agreement can be reached in Copenhagen” provided that the industrialized countries make “a firm commitment of reduction of emissions; a firm commitment on finance; and a firm commitment on technology”. Quite right, and fair enough. To set 40 percent over 1990 as a sine qua non is to deny any possibility of agreement. Several countries, the US first among them, will not arrive at that in the short run.

Obama will not commit to what he cannot get approved by Congress. Midterm elections are nearing and if he looses the majority, or it narrows downs, it will become even harder to deal with Congress. He is only too realistic to promise only what he can agree with Congress.

The US needs time for experimentation with the first Federal climate change bill ever, before it moves ahead. This is not a dreamworld, it is the real world we’ve got to cope with.

The conditions spelled out by G77 in Barcelona also included that the agreement “remain within Kyoto.” This is a good example of mixing opportunism and ideology.

Why Kyoto? Because it has the Annex-1 and nothing else. Such a demand generates immediate polarization. Representatives from Japan and the EU immediately answered they do not see why “non-Annex-I” countries should not commit to binding emissions cut themselves. Kyoto is not a relevant issue any longer.

The statements and demands of the G77 mix some fair points (criticisms of the uncertainty about industrialized countries’ commitments) to opportunism and ideological prose in unequal proportions.

The real fact is that it is too heterogeneous to legitimately speak with only one voice for all its members. First of all they are 130 members. Secondly, countries like China, Brazil, India, South Africa, Qatar and Bahrain – to name a few – should admit they do not belong together with Ethiopia, Afghanistan, Burundi, Congo, and so many other poorer nations. Even more so when discussing high carbon emissions. They are using the poor opportunistically, as shields to elude their own responsibilities.

They belong to an “Annex-II” with binding though differentiated commitments. They would still be eligible to financial and technological assistance, but at different conditions when compared to the poor countries.

The poor developing world is entitled to a greater financial assistance for adaptation, and all help in developing low-carbon development plans.

Emerging powers should be asked to present mid and long-term plans to cut emissions and build a low carbon economy. To do that they would be entitled to special financing mechanisms for mitigation and technological partnerships to develop low-carbon alternatives.

Another major obstacle to a new ambitious treaty lies on the the rules of the Climate Convention. They turn every player – rich or poor, relevant emitter or not, oil producing or oil consuming, large or small – into a veto player: one who is decisive to whether or not a decision will be made. All have the same power, because decisions are by unanimity.

This is only apparently a fair rule. In fact it treats very unequal actors very equally, feeding opportunism, and leading to a deadlocked situation that inevitably gives room only to muddling through, incremental policies as outcomes. It leads to a typical opportunistic situation in which a player maneuvers to shift the burden of deadlock to other players and to appear as the most righteous among the players.

Copenhagen is not flopping. It couldn’t deliver what it has been expected to deliver. But Copenhagen could successfully cope with the major obstacles preventing us to make real progress. Coping the right way with divergence and asynchronous national situations among the industrialized and the emerging powers we could still make progress towards the scientific requirements to prevent the worst case scenarios. Coping might be the only way to scape the BAU syndrome: the business as usual straightjacket were in.

First, it is in our powers to converge toward short and mid term objectives, and on accelerating rates dynamically adjusting the outcomes to the scientific requirements.

Second, we can try to solve once for all the financial hurdle that keeps several developing countries from playing the cooperative game. We have the expertise, and the resources to do it.

Third, we could do the same thing with the difficulties to get a firm technological commitment. The US technological partnerships with China and India are a good starting point that could lead us into a general model for technological cooperation in critical areas for mitigation of carbon emissions.

Fourth, countries need to be better, and positively, discriminated. The industrialized countries are correctly under one set of commitments proportional to their historical contribution, and their present level of nominal and per capita emissions.

Large emerging powers should agree to a different set of commitments proportional to their present nominal and per capita emissions and the trajectory of their emissions under BAU for the next decade.

Poor countries should be asked no emission cuts, but assisted in designing low-carbon development programs, to lead them to the new pattern without sacrifice, and at the same time enabling them to eradicate misery along the way.

This could be written into firm a political agreement, with the necessary elements for a new treaty to be negotiated and detailed over 2010. Meanwhile the large emitters – industrialized and emerging – could cut a deal of their own, sometime between next year and 2012, to establish national policies in line with their commitments written into the political agreement.

This is in our power to do, and Copenhagen could yet deliver such an outcome. So let’s hope we can have a COPEnhagen, not a FLOPenhagen.

Tags: Barcelona, , , , , , , , ,