Climate Crackup

A breakdown in Copenhagen saves a divided world from carbon rationing.

On December 18, the Copenhagen climate change conference collapsed. Heads of state from about 120 countries had flocked to the Danish capital, anticipating a historic photo op that would lead future generations to lionize them as visionary saviors who rescued the planet from the menace of man-made global warming. Instead the world’s leaders participated in an embarrassing diplomatic flop. 

Officially, a Copenhagen Accord was reached, but the three-page document largely consists of vague promises expressing the “political will” to combat global warming. Many leaders were already fleeing to the airport before the conference officially closed. This fiasco could spell the end of the United Nations’ attempts to use a costly and flawed carbon rationing scheme as a way to handle man-made climate change.

The conference came to this humiliating conclusion because the world’s two biggest emitters of carbon dioxide, the United States of America and the People’s Republic of China, remain at loggerheads. The U.S. needed China to accept legally binding carbon targets with some kind of monitoring arrangement to make sure the Chinese don’t cheat. Without these provisions, U.S. manufacturers (and the unions representing their workers) would be at a clear disadvantage, because their competitors in China could continue to use cheaper fossil-fuel energy. “From our point of view,” declared Todd Stern, the American special envoy for climate change, “you can’t even begin to have an environmentally sound agreement without the adequate, significant participation of China.” 

Stern is right. Unless China is seen as participating in the global effort to limit carbon emissions, the Obama administration will have a very hard time convincing Congress to pass carbon rationing legislation during a time of high unemployment at home.

Not surprisingly, the most ideological wing of the environmental movement was livid at the outcome. Erich Pica, president of Friends of the Earth U.S., denounced the Copenhagen Accord as “a sham agreement,” adding, “This is not a strong deal or a just one—it isn’t even a real one.” John Sauven, executive director of Greenpeace U.K., agreed: “The city of Copenhagen is a crime scene tonight, with the guilty men and women fleeing to the airport.” The American environmentalist Bill McKibben—founder of 350.org, which advocates keeping atmospheric carbon dioxide below 350 parts per million (compared to 387 parts per million today)—declared, “The president has wrecked the U.N., and he’s wrecked the possibility of a tough plan to control global warming.”

The good news for the rest of us is that the Copenhagen collapse provides the world with an opportunity to step back, reassess the political and scientific situations, and find a better way than the deeply flawed Kyoto Protocol process to address the problems associated with a warming planet. Preferably the new approach will neither clobber the global economy by dramatically boosting energy prices nor impose a Kyoto-style carbon rationing system that clearly doesn’t work. As President Obama pointed out in Copenhagen, “Kyoto was legally binding and everybody still fell short anyway.”

What Happened?

First a bit of background. The United Nations Framework Convention on Climate Change was signed and ratified by the U.S. Senate in 1992 after the Earth Summit in Rio de Janeiro. Under the convention, signatory countries were committed to reducing their emissions of greenhouse gases, especially carbon dioxide produced by the burning of fossil fuels, to prevent “dangerous anthropogenic interference with Earth’s climate system.” Every year since the treaty came into effect, a Conference of the Parties (COP) has been convened to assess what progress has been made. The Copenhagen meeting was the 15th such meeting and is thus known as COP-15.

Under the 1992 convention, which has now been signed by 193 countries, emissions goals were voluntary. But they became mandatory for 37 industrialized countries under the Kyoto Protocol, which was negotiated in 1997 at COP-3 and fully ratified in 2005.

The Kyoto Protocol, which President Bill Clinton never even forwarded to the U.S. Senate (President George W. Bush withdrew from it completely), set up a cap-and-trade emissions reduction scheme for participating countries. Under a cap-and-trade program, a business that wants to emit greenhouse gases—say, an electric utility or an oil company—needs to acquire permits equal to the number of tons of carbon dioxide it wants to emit. Governments then set a declining cap on emissions by issuing fewer and fewer permits each year. The permits, however, can be bought and sold on an open market. Producers that cheaply abate their emissions can sell their extra permits to other emitters that find the process more expensive. In this way, the theory goes, the market will find the cheapest way to cut emissions. As it happens, only the European Union ever established a carbon market under the Kyoto Protocol, and it has been riddled with problems. So far the scheme has not induced emitters to make significant investments in low-carbon energy technologies. 

The Kyoto Protocol expires in 2012, after which a second commitment period is supposed to replace it, with more extensive mandatory emissions reductions. At the Bali climate conference in 2007 (COP-13), it was agreed that a binding global treaty setting the new standards would be finalized at Copenhagen. But two years of preliminary negotiations proved difficult, so that goal was dropped a month before the conference was even convened. Instead, the Copenhagen meeting was supposed to produce a “politically binding” framework agreement that would set specific commitments to emission reductions and climate aid to developing countries as a basis for future action. The weak Copenhagen Accord does not even achieve that much, putting off those decisions indefinitely.

Chiefly negotiated by the U.S., China, India, Brazil, and South Africa, the nonbinding Copenhagen Accord sets a goal of preventing global temperatures from rising more than two degrees Celsius above preindustrial levels. The Accord reaffirms the importance of the two degree goal and “recognizes the scientific view” that the temperature increase should be held below this number. (As Jeremy Hobbs, executive director of the global anti-poverty nonprofit Oxfam International, put it to the Times of London, the accord “recognizes the need to keep warming below 2C but does not commit to do so.”) Many environmentalists and scientists had argued for a more ambitious 1.5 degree Celsius limit. Initial drafts of the accord set a global goal of cutting greenhouse gas emissions by 50 percent over the next 40 years, with the developed countries reducing their emissions by 80 percent. That goal was dropped at China’s insistence, according to Ed Miliband, Britain’s climate and energy secretary. 

The initial aim of adopting a binding treaty by the next international climate conference, to convene this coming November in Mexico City, was also dropped. Now the implementation of the Copenhagen Accord will be reviewed by 2016. 

The accord promises that the industrialized countries will supply $30 billion worth of climate change aid to developing countries by 2012 and will “mobilize” $100 billion annually in aid by 2020, using both public and private sources of funding. With regard to monitoring each country’s emission reduction pledges—the big sticking point between China and the U.S.— countries are supposed to provide information on their efforts to cut greenhouse gas emissions, but the guidelines for auditing those activities are to be negotiated later. In any case, it’s unlikely that the politicians who are in office in 2020 will feel constrained to honor the Copenhagen Accord’s vague promises about emissions and financing.

Back in the USA

In the wake of Copenhagen’s spectacular blowup, what will happen to the domestic regulation of carbon? That idea is clearly advancing in one area: The Environmental Protection Agency announced in early December that it will start enforcing strict carbon controls. (See “The EPA’s Carbon Footprint,” page 36.) But what about the carbon rationing proposals advanced by the White House and the Democratic leadership in Congress?

Back in June, the House of Representatives passed the Waxman-Markey Act, which aims by 2020 to reduce U.S. carbon emissions 17 percent below the level emitted in 2005. When House Speaker Nancy Pelosi (D-Calif.) dropped by the Copenhagen conference, she said of Waxman-Markey, “It’s all about the jobs.” To hear Pelosi talk, saving the planet from climate doom is incidental to making sure Americans are employed making solar panels and weatherizing houses. Sen. John Kerry (D-Mass.), a co-sponsor of an energy and climate change bill in the Senate, similarly asserted in Copenhagen, “Our bill is essentially a jobs bill.”

Showering government largess on an industry will certainly increase employment in that industry. It’s much less clear that such subsidies will produce more jobs on balance. Kerry thinks it will, claiming that when Germany enacted “strong policy mechanisms to drive investment in solar power and other renewable energy sources,” the result supposedly was employment growth: “Renewable energy usage has tripled to 16 percent, creating 1.7 million jobs. By 2020, Germany’s clean energy sector will be the biggest contributor to the nation’s economy.” 

An October 2009 study by RWI, a nonprofit German economic think tank, however, concluded that policies pushing renewable energy end up producing “job losses from crowding out of cheaper forms of conventional energy generation, indirect impacts on upstream industries, additional job losses from the drain on economic activity precipitated by higher electricity prices, private consumers’ overall loss of purchasing power due to higher electricity prices, and diverting funds from other, possibly more beneficial investment.” The report called Germany’s experience “a cautionary tale of massively expensive environmental and energy policy that is devoid of economic and environmental benefits.”

Perhaps carbon rationing and higher energy prices will help us avoid a climate disaster. But these measures will tend to increase rather than decrease unemployment. The carbon rationing proposals in Congress are not really job bills, a fact that will make them harder to pass. Republicans seem confident that Waxman- Markey, which passed the House in June by a margin of just seven votes, will never make it to the Senate.

Before the Copenhagen conference collapsed, Sen. Kerry declared that getting climate change legislation passed in the U.S. “can be enormously assisted by what happens here.” Once the nondeal was announced, the Massachusetts senator gamely peddled the same line: “With this in hand, we can work to pass domestic legislation early next year to bring us across the finish line.” We’ll all find out this spring who is the better political prognosticator, Kerry or Rep. Fred Upton (R-Mich.), who said, “This Waxman- Markey bill would lose by 50 votes if it were up for a vote now. This bill is dead in the water as it is and that’s why it’s DOA in the Senate.” After the diplomatic debacle in Copenhagen, my bet is on Upton.

And if the U.S., as the world’s second biggest carbon producer, does not adopt some form of rationing, it is highly unlikely that the rest of the world will do so. On the way to his plane, President Obama declared the Copenhagen Accord a “meaningful and unprecedented breakthrough.” It would be more accurate to call it a meaningful and unprecedented breakdown— one that could end up sparing the world from a costly and flawed scheme of global carbon rationing. 

Ronald Bailey (rbailey@reason.com) is reason's science correspondent. This column first appeared at Reason.com.

Ronald Bailey is Science Correspondent





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