Sunday, September 13, 2009

Success not guaranteed in Copenhagen climate talks | Green Business | Reuters

Success not guaranteed in Copenhagen climate talks | Green Business | Reuters: "By David Stanway

DALIAN, China (Reuters) - With negotiations still fraught and complex, a successful end to climate talks in Copenhagen in December still cannot be guaranteed, said Steve Howard, head of the London-based Climate Group.

World leaders gather in the Danish capital to put the finishing touches to a new and far-reaching global accord to combat manmade climate change, but the stakes are high and a breakdown is still a possibility, Howard said on the sidelines of the World Economic Forum in Dalian.

'Anybody who thinks this is just an environmental agreement is actually mistaken: this is an economic agreement now and therefore the stakes have been raised,' he said.

'A deal that we have to declare a success but actually isn't -- that's the worst scenario. There is a possibility there is a breakdown, or a multilateral agreement that is a coalition of the willing or a deferral of six to twelve months. All of these things are still possible.'

As the world of nations rushes to the finishing line of Copenhagen, seeking to whittle down a sometimes contradictory negotiating text that now stretches to 280 pages, many issues remain in doubt -- including the future of the Kyoto Protocol's 'clean development mechanism,' which will expire in 2012.

The CDM has enabled industrialized countries to fund CO2 reduction projects in the developing world in exchange for U.N.-backed offsets known as certified emission reductions, which can be traded or used to meet mandatory national targets.

But European Union negotiators, critical of the way the CDM has created a flood of cheap and low-quality CERs, is urging China and other developing countries to accept a "sector-based" mechanism in which entire industries will be obliged to substantially cut their emissions.

"The CDM is likely to be different after Copenhagen and one extreme is sector-based," Howard said.

"People see that the value that the CDM has delivered but also recognize we need to speed up the approval process because the transaction costs are prohibitive. So we want things to happen faster, with greater certainty and on a bigger scale."

China, however, is concerned that the "sector-based" approach is an attempt to impose mandatory CO2 cuts by stealth, and is holding out for incentives like technology transfers and investment funds as part of the new Copenhagen deal.

There are other proposals on the table, including a plan to commit developing countries to "pathways" that diverge from "business as usual" carbon dioxide emissions, Howard said.

"They put a negotiated pathway forward that isn't in the short-term an absolute reduction in emissions, but a deviation from the projected 'business as usual'. If they do better than this, they can trade (carbon offsets)."

Like any other proposal, the devil is in the details.

"There will be some vicious haggling over the pathways," Howard said.

If a deal is deferred until next year, the problems will mount, he added. Continued...

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