While Americans have been riveted by election shenanigans for the past couple of weeks, another drama was unfolding in The Hague, where hundreds of international representatives struggled to agree on how to combat global warming. They were seeking strategies for implementing the Kyoto Protocol, the landmark treaty signed three years ago that gives countries until 2012 to reduce greenhouse gas emissions to below 1990 levels.
But hopes for an agreement collapsed over the weekend and the meeting ended without a deal. According to press reports, there were two major bones of contention. First was the issue of countries earning reduction credits for forested land (known as carbon “sinks” since they soak up carbon dioxide, the leading greenhouse gas). Heavily forested countries such as the U.S. and Canada lobbied aggressively for such provisions while the Europeans opposed them, offering only limited credits for sinks.
The second issue was the establishment of a system to trade cash credits for emissions. This would effectively allow polluting countries to purchase their way into compliance with treaty requirements through deals with nations whose emissions fell well below the mandated limits. Again, the U.S. was the key backer of creating this kind of trading system.
American negotiators have always stressed the need for a pragmatic agreement, a treaty that a skeptical Congress might reasonably ratify and that also includes incentives for industry — in other words, a treaty with an eye on economic and political as well as environmental concerns. But critics blast the U.S., by far the world’s biggest polluter, for trying to buy and bully its way out of having to make a serious effort to reduce emissions.
Salon asked two experts with very different points of view — an environmental lawyer and a power industry executive — to take a look at the recent summit and predict what will happen next.
Do you think there would have been much benefit to an agreement given Congress’ likely resistance to it?
I do. First, I think Congress’ resistance is somewhat overstated. The recent elections have improved the moderates’ hand, particularly in the Senate, which is where ratification takes place. As one example of that, Sen. McCain held very serious hearings on climate change after he’d gone around the country campaigning for president.
I think we would see that McCain and others in the Republican Party would take a more moderate position toward Kyoto. There’s still going to be huge opposition from Jesse Helms and (Robert) Byrd. I wouldn’t say that we definitely would have gotten ratification, but I think it would have been a very serious and very closely fought battle if we’d gotten a decent agreement out of The Hague.
Do you think the dangers of the collapse of the talks have also been overstated? Did anything positive come out of this?
The collapse is a bummer. But the reason why it collapsed was because the U.S. and certain European countries couldn’t come to an agreement over what measures would have to be taken.
A lot depends on what happens now. The problem’s still going to get worse. The science is still going to drive us to have to have international cooperation. So we may come back and ultimately have a stronger agreement. Given that we may have a Bush presidency, it’s hard to believe that we will in the near term have a stronger agreement, but the problem’s not going away.
Do you think there might have been a different outcome at this summit if the presidential election had been resolved before the meeting started?
I don’t know how the dynamics work out there [in The Hague]. But given that most people have thought Bush has the inside track, if the election were going to have an impact it would seem to me to be the fear that if they don’t take this agreement now, they’re not going to get anything for the next four years. On the other hand, some people might have said, “Look, we can make this agreement here and it isn’t going to mean anything because the next administration isn’t committed to it.” That may have ultimately been why people said, “Let’s wait and try to renegotiate this soon.”
Regarding the particular areas of contention — the carbon sinks and the emissions credits — would compromising more with the U.S. have had a severe negative impact on the possibility of reducing emissions?
To be fair, the U.S. has said that they had certain working assumptions with respect to the Kyoto Protocol when they signed it, and that they would be able to take unlimited advantage of the trade emissions and the forests. However, some of the U.S. positions were hard to comport with the treaty text. The bottom line for the environment is that the U.S. is going to have to do more.
It may be that the best way to move this agreement forward is to have the U.S. dip its big toe in the water first, which would be kind of what the U.S. was saying — get us tied into the reporting periods and tighten it down later. But nobody believes that what the U.S was offering is going to be enough to avoid climate change over the long run. The compromise that was put forward by the Dutch on Thursday [on forest sinks] was a reasonable compromise. And the U.S. rejected it. When they came back for the second round on Saturday, the Europeans said, “We’ve given enough.”
Do we need to have a treaty where the biggest polluter in the world is going to be able to meet most of its obligations by not doing anything? I give the European countries credit for saying, “Why have a treaty if it’s just going to have loopholes so big that you can drive a carbon-belching truck through them?”
Where is the best science on the issue coming from now?
The Intergovernmental Panel on Climate Change, which is set up under the treaty to organize and look at the science. They issue the reports every five years. They have a major report coming out soon, and a summary was leaked about a month ago as well, that said we do have man-made climate change occurring today. And that’s valuable because there are a lot of different studies going on about climate, but what that effort tries to do is consolidate it in one place and summarize it in a way that’s valuable for policy makers.
What do you expect will happen next?
It could go either way. It’s possible that a lot of countries could move forward with the Kyoto Protocol without the U.S. It’s also probable that most countries, including the U.S., will take domestic measures with or without the treaty.
A realistic view would say that some binding obligations are inevitable, if not this year then within five years, and so trying to continue to organize government response and industry response at the domestic level is a prudent way to go for economies. I think you’ll see a lot of national-level efforts, maybe some regional negotiations. But I don’t know what’s going to happen with the global agreements.
Industry is changing. I think they’re seeing the writing on the wall. We may have a lull for a couple of years because the Bush administration’s initial reaction will be anti-Kyoto and anti-international negotiations. But because industry’s perspective will continue to change, and science will continue to change, we’ll be back at the table in a couple of years.
When you say industry is seeing the writing on the wall, do you mean that they’re being pressured to do something, or that they’re looking at it pragmatically?
I think mostly from a pragmatic point of view right now. There is some writing on the wall from a regulatory point of view, but right now the companies that are switching their philosophies are ones that are saying, “Not only are there cost-effective ways to reduce our climate impacts, but there’s also business opportunities available.” Companies who have a 25-year business plan are starting to take into account the fact that the future is going to be much less dependent on fossil fuels.
Dale E. Heydlauff, senior vice president of environmental affairs for American Electric Power, was one of several U.S. industry representatives who pushed for the controversial carbon sinks and the trading of emissions credits with other nations. He also stressed the need for penalties to be applied to all nations — not just the U.S. — who violate pollution limits set by the treaty.
AEP, a multibillion-dollar company that supplies power to almost 9 million domestic and foreign consumers, is a member of the Pew Center on Global Climate Change’s Business Environment Leadership Council, a group of companies who work with non-governmental organizations to find cost-effective solutions to the global warming problem.
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You told the New York Times during the conference that without strong penalties for countries that break pollution rules, the Kyoto Protocol would be “a fraud.” Can you elaborate on that position?
One of the interesting things, and I don’t think it was well understood over there, is that the issue of a strong and effective compliance enforcement regime is an issue on which there is almost complete unanimity among U.S. industry and U.S. environmentalists. For different reasons perhaps, but there was very much alignment in views. Penalties that act as an effective deterrence for noncompliance — that has been the history of U.S. environmental law for a long time now.
One of the things that we are concerned with in American business is that we don’t want to be bound by strict enforcement provisions if the rest of the world, our trade competitors, do not have similar binding consequences for noncompliance. So we’ve been arguing pretty strongly that you need effective compliance mechanisms. Introducing emissions trading makes compliance and the price of compliance very transparent. We have to presume that not all nations are going to play fair and not try to manipulate the system for profit. If caught, they need to be held accountable.
Did that position conflict with the positions of developing countries?
It was a combination of developing countries and European Union countries. There was just a real divergence of views about how to do it. Developing countries have not liked the idea of binding consequences. You also have different philosophical views. Japan, for example, has long argued that binding consequences are not necessary, that countries would take their compliance obligations seriously and would not want to lose face by failing to comply. That doesn’t give us a whole lot of comfort.
Despite the collapse of the negotiations in The Hague, many people say that there is a greater sense of urgency than ever to pursue serious solutions to global warming. Do you see that as being the case?
I don’t know if I share the same sense of urgency. I certainly believe it’s very important for them to get the rules right. I applaud the decision to reject a bad deal rather than accept it for the sake of getting a deal. I think it’s much more important to take the time necessary to educate themselves about how market mechanisms work and then put in place the kind of rules that will help facilitate cost-effective emission reductions in the future.
What are your thoughts on the Department of Energy report that was released right before the conference started and recommended cost-effective ways for U.S. industry to reduce emissions?
Quite honestly, it suggests that virtually every manager and executive in every industrial sector of America are a bunch of idiots that we haven’t recognized hanging fruit and harvested it by now. I don’t buy it. I think we are always in pursuit of efficiencies and if they were as cheap and affordable as the report suggests it is, we would have already used them. It’s not that easy.
No question that efficiency is going to play a major role, both in the energy supply sector as well as the demand sector. We need to exploit it as much as possible, but I really don’t think there’s as much low-hanging fruit as the study would lead you to believe.
What are a couple of examples of things that your company has worked on?
We have been a global leader in forest preservation and forest carbon management. Another area is in the advancement of efficient energy production in transmission technologies. We’ve been an industry pioneer in these areas for 50-plus years and I think we have a lot to contribute to more efficient and less carbon-intensive technologies. We hope to do that, once we know what the rules of the game are going to be.
What do you think the next step will be in terms of industry’s role?
Industry will clearly lead the effort to reduce, avoid and sequester greenhouse gas emissions. They’re the ones that have the capital and intellectual know-how to make any emissions reduction requirement a success. And sometimes we’re frustrated at these conference that not everyone recognizes that fact, and gives our views more attention and credence.
But the fact is, that’s the history of the world. It is industry and technology that will ultimately solve this problem. We need to have clear and workable and reasonable rules to get on with the task of reducing atmospheric concentrations of greenhouse gas emissions. And those have been elusive.