Tue Jan 27th, 2009 at 02:32:10 AM EST
In the middle of December, the European Union passed a legislative package on climate change policy that should be understood in the context of this year's global negotiations on the topic. Because the package represents a minor step back from what the EU had promised to do unilaterally, it was lambasted by environmental groups. More surprisingly, some media organisations jumped in on the action.
Many of the objections of environmentalists to European climate change policy can be understood in the context of the 'Overton window'. Their criticism is harsher than would seem reasonable, but this is a design to shift the political centre towards their position. The centre, in that context, is a social construction mainly formulated through the mainstream media. For more, read this post by Jamais Cascio.
As a perpetual concern troll, I worry whether this approach is overrated. The least that needs to be digested is that the original formulation of the Overton window is about advocating more extreme policies than you wish to see implemented in order to widen the spectrum of imagined solutions. Not just about kicking up noise.
promoted by afew
The background to this climate package is that the European Union has previously declared that it will cut its emissions by 20% by the year 2020, and offered to increase that to 30% if other countries also offer a serious commitment in global climate change negotiations. These numbers take the year 1990 as a baseline, as it is used in the Kyoto protocol; the EU as a whole is now around 8% below that baseline.
The EU's target to achieve a 20% reduction is complemented by a 20% target for renewable energy, and a 20% energy efficiency improvement. The legislative package that was adopted by the European Parliament contained a set of laws that arranged the emission reductions and renewables. The energy efficiency target is to be achieved through a broader set of measures, only one of which was part of this package.
These targets have all been upheld. However, there are a few elements to the package that have weakened the European commitment:
- Car makers are now obliged to meet the carbon dioxide emissions standards in 2015, instead of 2012
- The package includes a giveaway to the coal industry in the form of support for 'Carbon Capture and Storage'
- The third phase of European Emissions Trading Scheme will still mainly be based upon handing out emission rights for free rather than auctioning them
- EU Countries have the option to meet up to three quarters of their national targets by investing in third countries
The last point is especially worrying, for political reasons. Many European countries used to be opposed to the Clean Development Mechanism, and the EU had strongly restricted the use of credits gotten through that tool for achieving national targets under the Kyoto protocol, and had similarly restricted their use in the Emissions Trading Scheme. Backtracking by Europe means that there is now no more real opposition to expanding the tool. Promising this kind of boon could also prejudice developing countries in ongoing climate change negotiations against taking on real commitments.
In reaction to the compromise, the WWF has written that the EU has adopted a 'poisoned' climate package, because of the extent to which the targets can be met by importing credits. Greenpeace, meanwhile, doubts whether the 20% target will even be met.
There is a bit of truth and a bit of BS in both of these statements. The truth can be read between the lines in the WWF statement. Under the more plausible expectations of economic growth, resource prices and demographic patterns, the EU should easily meet the 20% greenhouse gas reduction target domestically merely by meeting its renewable energy and energy efficiency targets. The question is rather: who pays?
Under this package, that would be the consumer and the taxpayer. This represents a shift from an implicit corporatist understanding within EU climate policy - that each sector has to pay for a proportional share of emission reductions. Greenpeace frames this in environmentalist terms by saying that polluters now don't have to pay. I'd rather say it's a huge giveaway to companies in those industries that don't face heavy global competition and especially to those in the energy sector. These companies will be able to continue reaping windfall profits by pricing in the cost of emission rights in their products, even though they themselves did not have to pay for the emission rights.
We will all still pay the higher electricity prices. Now, there is a simple way we could deal with this nationally, that doesn't distort the emissions trading market: tax the windfall.
Interestingly, the climate package was also criticised in the pages of the IHT, which had a good article on the EU's 'dramatically scaled back ambitions', and another good article on the Emissions Trading Scheme.
As the package signified a significant retreat on some elements of the EU's climate policy, further retreat can not be ruled out. These policies are now law, and that makes them more secure. But a lot of elements of the energy efficiency action plan still need to be implemented.
Still, the EU is not in peril of giving up its 'climate leadership' - at least not to anyone else. Last time I heard Obama talking about the United States, he was saying he wanted to go back to 1990 emissions by 2020, meaning a 0% decrease. Australia's Kevin Rudd is offering 15% if other countries also commit. Canada is planning a reduction of 2.7%, while Japan has yet to announce an offer for 2020. No developing country has been willing to even talk about setting an absolute cap.
The promise of the EU to increase its reduction to 30% still stands. Considering the offers from other developed countries, the EU probably won't go that far. Regardless, we can now see that two problematic elements will probably remain:
1: Expansion of the Clean Development Mechanism in the next global agreement.
2: Free allocation of most emission rights over the 2012-2020 period of emissions trading.
The first needs to be counteracted globally, in a campaign leading up to Copenhagen, and probably the climate change conference after that. The second can be counteracted domestically, by pushing for windfall taxes.