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What I would like from Bali
Tariq Banuri, SEI
2007
Introduction
• Four opening points
– Climate change is real
– Happening not a time of our choosing—
unfinished global agendas could be on
collision course with climate response
– Other complicating factors may make life
more or less difficult
– Solutions do exist; the obstacles lie
elsewhere
• Not argue about adaptation, because
what is needed is well known
Tipping Points
and Challenges
The simple answer:
Reduce carbon emissions
Not so Fast
Carbon Emissions/Capita (tons)
14.00
Qatar
12.00
10.00
United Arab
Emirates
8.00
Luxembourg
Bahrain
6.00
Singapore
United States
Aus tralia
4.00
Norway
Canada
Saudi Arabia
Cze ch Re public
Japan
2.00
Switzerland
Hong Kong, China
0.00
0
5,000
10,000
15,000
20,000
GDP/Capita (PPP$)
25,000
30,000
35,000
Climate and Development
• The development agenda is real—and,
like climate, will be ignored at our peril
• Mounting frustration over the inability of
the development agenda to change
anything of substance has been blunted
by 2 factors: China and India
• But frustration is mounting elsewhere
• Bottom line: Protect the “book-ends”
Back to Emissions
A Simple Decomposition
Energy Emissions =
Population x Affluence x Energy Intensity X Carbon Intensity
E = P (Y/P) [E/Y] (C/E]
The Aggregate Challenge
Energy Related CO2 Emissions
Population
bns
2005
6.42
GDP/cap
PPP$
6,541
E/Y
MJ/$
CO2/E
KgCO2/GJ
12.1
54.3
2050
Target
27.5
14.0
2100
IS92a
11.3
29,730
2100
9-11
25-30K
2100
450 ppm
Trajectory
C
GtCO2
Between
9-11 billions
4.5
50.0
Need 8-10 not 225!
More is better Main potential for
(?) but quality change
could improve
75.0
~4.0
~4.0
Climate Options
Concentration
Shift to
Renewables
CCS
Energy
Efficiency
Carbon Emissions
Energy
Per Capita Income
Population
Limit Population
How much
Is enough
The Obstacles Lie Elsewhere
Some economists and development experts [sic] criticised
the [Human Development] report…that a quick, costly shift
away from fossil fuels, the main source of emissions, could
actually backfire, blunting the climb towards prosperity that
they say is a prerequisite for action to improve environmental
quality.
Another reason…is that risks are rising…because population
growth in poor places is greatly increasing how many people
are exposed…
Robert O. Mendelsohn, “An aggressive mitigation plan is likely
to be a greater threat to growth than climate change impacts.
We do not yet have the technology…”
New York Times 28 November 2007
Umm, Bob, we do have the technology
With apologies to my French Friends
Economists are like Frenchmen. No
matter what one says to them, they
immediately translate it into their own
language. And forthwith it becomes
something entirely different.
Recognizing the two challenges
Carbon Emissions/Capita (tons)
14.00
Qatar
12.00
10.00
United Arab
Emirates
8.00
Luxembourg
Bahrain
6.00
Singapore
United States
Australia
4.00
Norway
Canada
Saudi Arabia
Czech Republic
Japan
2.00
Switzerland
Hong Kong, China
0.00
0
5,000
10,000
15,000
20,000
GDP/Capita (PPP$)
Source: World Bank (1998); Marland, et al. (1998).
25,000
30,000
35,000
The Bowl and the Stem
Growth is the only sure recipe
short of a global revolution to
reduce inequality, establish
human rights, and eradicate
poverty
• The inability to mobilize international action on
climate is in part because of the inequality
• Current solution—separate and equal—produces
only a race between growth and catastrophe
• Only by integrating the twin goals (climate and
development) can progress be made
History I: Common and Differentiated
PREAMBLE: Emphasizes differentiated responsibility,
prevention of harm, differing needs, vulnerabilities,
capabilities and resources. [12 out of 23 paragraphs]
OBJECTIVES: Calls for economic development to proceed
in a sustainable manner.
PRINCIPLES: Each of 5 principles includes equity
considerations: equity, special needs, precautionary
measures, right to sustainable development, and developing
country growth.
History 2: Separate but Equal
• Voluntary Commitments (average 5.2 % below
1990 by 2008-12)
• Emission trading plus adaptation fund
• “Equity” disappears, financial and technological
transfers still promised (but lose prominence),
focus shifts to domestic action/options
• In retrospect, none of the commitments were
fulfilled: emission targets not achieved, finance
and technology minuscule
What Regime(s) would be best
Emissions Based: e.g., (a) national targets; (b)
national emission rights; (c) per capita emission
rights; (d) emission development rights
Tax Based: Carbon-tax (comparable to targets)
Regulation-Based: e.g., Immediate moratorium on
exploration and phased-in on extraction.
Investment-Based: Global public investment
program
Cross Cutting issue: Comprehensive solution or rolling
regimes?
Criteria for Regime Choice
• Development: What will happen to development: in
fast growing countries, in other countries?
• Policy consistency: Can we bind future
governments? Will the private sector believe it?
• Simplicity: How transparent and direct? Are
ancillary measures needed? Is there adequate
experience (especially in the South) to operationalize
on significant scale?
• The trust deficit: Aid? Conditionality? Partnership?
• Immediate action versus comprehensive solution?
Why the singular focus on Emissions?
• Position over emissions are too far
apart and can only lead to a stalemate
• Need for two separate strategies that
can bring North and South as well as
Climate and Development together
• Emissions and markets for North,
investment for South
• Change in language: from “who did this”
to “let the market do it” to “the public
sector can lead this”
Kartha et al’s Formulation
80% global reductions by 2050
What’s left
for the South?
90% by 2050
in the North
What kind of climate regime can make this possible?
How about the other way around?
CDM Critique
“Mommy, where do carbon
offsets come from”?
“Well, you see, honey, when a
polluter and a consultant
love money very, very much,
they come together in a very
special way to produce an
extremely long piece of
paper”.
Gar Lipow, Systems Analyst
and Peace Activist, 2006
Cited in Carbon Trading, p. 61
Policy Credibility
• Can we bind future governments, democratic or
otherwise
• What about future uncertainties: political chaos,
donor fatigue, fortress world
• Are national policies credible?
• Can governments take a passive role (let the
market do it), or do they need to take risks and
make bets?
• Single or rolling plans?
Investment
Investment Fund:
Global fund 1 per
cent of world GNP
for climate
transition
allocated mainly
by population in
the following
areas: hydrogen
spine for fuel
cells, CCS, R&D,
building GR-type
network,
sustainable
cities
Financing: progressive source by income
rather than country.
Technology Transfer: Support inter-locking
institutions for extension, research, education,
policy, inputs, credit, marketing.
Integrated Goals: Sustainable development
as well as climate stabilization and adaptation.
North-South: Trading for N. Investment for S.
Regulation: No coal plants without CCS.
Suspend TRIPS. Moratorium on fuels
What I hope from Bali
• Fulfill Kyoto targets: E+F+T
• Deeper targets for rich countries for 2020
(though still below what is needed)
• Adaptation fund (including emergency
response fund/ agency)
• CBMs: (Kyoto targets), other ODA, win win
investments
• Investment in carbon free development
plans + institutions for South
• Negotiation platform on refining all above
Beyond Rearranging Deckchairs