text: Cristina Mircea
Jos Delbeke, deputy director general of DG CLIMA, stressed at the Q&A session of the EJC lead conference on climate change in Brussesls that there is no strong reason for Europe to jump forward with Kyoto without sorting out a number of conditions. The first one is the environmental integrity. The 20% target that Europe has adopted is much more stringent than the case of continuing simply under Kyoto. ” There are a number of major flaws in the Kyoto Protocol that must be sorted out before the EU can subscribe to Kyoto. For instance the “land- use change”, which currently means that you can just do whatever you like.”
Photo: Jos Delbeke, Director General, DG CLIMA © 2010 Mihai Stoica / 2Celsius Network
Europe is not the biggest carbon emitter compared to China and the United States, but this only from a production and not consumption point of view, because Europe imports around 4 tones of CO2/ person in form of products from China for example, and all these products contain embedded carbon. What is your opinion on that?
It’ s true that through our very consumption we have an indirect CO2 emission problem, but as a regulator you have to ask yourself where is the point of intervention, and in this case we have been strategically selecting the production point as a way of regulating, because if you put the sustainability challenge over the long term there is no other solution than to bring forward a new carbon technology. If we hope that people will drastically accept the reduction of their standard of living just based on climate change reasons we’re not going to get anywhere. We will need low carbon technology, because our economic analysis shows that in the short term this is the biggest emission reduction you can get in industry. I’m not disputing whatsoever the consumption levels issue, but that’s another point of interference and that may come through taxation. We all know that in that matter EU has almost no competence, which is a major impediment many of us regret and that may not change in the future. So carbon taxes to be regulated at the European level is not an option.
Concerning border measures, they are claimed because people say our ETS (European emission trading scheme) is preferred in industry and the easiest way for industry is to go for import and not to produce here. It is true that industry is complaining a lot but we have not been observing any delocalization because of our carbon policy. The reason for that is that we were handing out the allowances and the ETS predominantly for free, and it’s going to stay like that until the carbon prices or the possibilities for industry to make their solutions through technology are going to come to a limit. Companies must buy and sell and the only exception is for electricity production, which is not a subject for international trade. More than 99% of electricity production happens on the European continent. These border measures are quite a dynamite in the international negotiations because the emerging economies such as China and others are against and say that these measures would blow up the international climate negotiations and there would be a trade war triggered through that and we are very vigilant not to create one.
You said regarding the ETS that there is a lot of complaining from the industry. How long do you think you can keep up with that until the EU is forced to move backwards, if the international negotiations don’t work out the way you expect them to?
We have our legislation in place, the CAP is ruled until 2020, that is the ending date and until then it will stay as it is and any review that we’ll see is going to be upward and not downward. What we see in the EU ETS matter worldwide is a step back from the United States, which was very disappointing for many of us, but on the other hand we see an uptake on ETS in Japan, New Zeeland, we are also heading of next week to China, we are talking to Korea and Taiwan, so there is quite a number of countries that are looking at a cap and trade system and they are going to do it slightly similar and slightly different from what we are doing. I wouldn’t be so pessimistic about it though, on the contrary, I would even say let’s take a step away from the negotiations and see what countries have been doing since Copenhagen, and they have done much more in reality than they negotiated about, particularly China, regarding the energy efficiency, renewables, reforestation, so I think that the message was understood and actions are being taken.
If you look from a more optimistic point of view at the ETS and some analyses which show that no carbon cuts will be required until 2016 the CAP on ETS is far too high. How can that be reduced?
Is the EU CAP to high? Well, some say it’s too low. I think it’ s good that the EU CAP is there, it’s at the lower end, still, when I observed the American and Australian debates, the price of 15 euros/ tone of carbon, that’s roughly 20$ / tone of carbon, would be considered in US legislation (if it would have gone through) as way beyond the maximum price that was feasible in the current circumstances, and also beyond the current price that is being debated in New Zeeland and Australia. So our 15 euros/ tone could be much higher but it’s still a price that according to recent research is making power stations or power companies think twice before they invest. So I would not jump to conclusions that the EU CAP is too high, but it can be improved.
You stated earlier that the EU is prepared to continue the Kyoto Protocol. What are you waiting for, specifically, to continue the Kyoto?
We do no think that there’s a strong reason for Europe to jump forward with Kyoto without sorting out a number of conditions. The first one is the environmental integrity. The 20% target that Europe has adopted is much more stringent than the case of continuing simply under Kyoto. There are a number of major flaws in the Kyoto Protocol that must be sorted out before the EU can subscribe to Kyoto. For instance the “land- use change”, which currently means that you can just do whatever you like. Another issue is that of the AAU’s (assigned amount units) created under Kyoto by the United States, through which they would buy the AAU’s from Russia. Europe was clearly playing innocent at the time. And even if the US dropped the Kyoto, the AAU’s created are still hanging there. We are talking about 10 billion tones of CO2!
There is a second condition
: Kyoto parties are now 30% of the emissions, Japan and Russia said that they will leave the protocol, so if Europe were to subscribe to Kyoto it would find itself alone with perhaps just Norway, Switzerland, Liechtenstein, Monaco and a few others. What is the meaning of the Kyoto Protocol if only Europe goes ahead? We must sort that out and we also want to have parallel action, a parallel framework for those not continuing with Kyoto, because we have to think about the United States or the group of developing countries, with the four major emerging economies (China, India, Brazil and South Africa) which are increasing very rapidly their emissions. Also we have to have another debate: a lot of countries are finding themselves in the group of developing countries( like the Middle East) and their income per capita is way beyond the income per capita of several member states in Europe( such as in the case of Dubai, Singapore, Saudi Arabia which have an income per capita way beyond Romania, Portugal, Greece, etc). We have to qualify that and it’s an open call to developing countries to sort out this kind of debate internally, because what we see is a very capable China is using a developing country rethoric to hide that they are really behaving as an industrial nation, and they should take obligation as an industrial nation.
Regarding the AAU’s issue, you stated that this is a major flaw in the Kyoto Protocol. Does it mean that the EU is not going to approve with that in the next Kyoto commitment period and do you think that is possible for the EU to speak in one voice about it, because there are still some concerns in Eastern European member states that those surplus AAU’s should be used after 2012?
It is true that there are different opinions in Europe concerning the AAU’s, because a lot of our new member states are having parts of them. What we are telling to these countries is that this is an internal issue that should be dissociated from the international negotiations. We do recognize the AAU’s problem at all levels and we have to find a solution to it. But I think that even our colleagues in the new member states would agree with me that if Russia and Ukraine were to bring their AAU’s to the market, the market would sink and the AAU’s would be worthless. But this refers to the debates for the next Kyoto period, and we will bring the AAU’s question to the table for the next period which starts in January 2013. Until that date our new member states like Russia and Ukraine can use their AAU’s on the market as it was agreed.
Transportation measures and regulations are important aspects in reducing CO2 emissions. What exactly do you have in mind and when should we expect to see these measures implemented?
We are going to come with our transport paper presumably at the beginning of the next year. We have a little delay in our work but we are steaming ahead and we will see a multitude of measures related to infrastructure, technology, taxation, even if we can’t take all these measures at the European level.