Global Climate Change Negotiations: Learning from the Past to Think Carefully about the Future

I’m pleased to say we have released the newest episode of our podcast, “Environmental Insights: Discussions on Policy and Practice from the Harvard Environmental Economics Program.”  In this latest episode, I engage in a conversation with Sue Biniaz, long-time legal expert and lead negotiator for the U.S. Department of State in the international negotiations under the United Nations Framework Convention on Climate Change (UNFCCC).

Sue is currently a Lecturer in Law at Yale Law School in New Haven, Connecticut. Before that, she served for over thirty years in the State Department’s Legal Adviser’s Office, where she was a Deputy Legal Adviser, as well as the lead climate lawyer and a lead climate negotiator from 1989 until early 2017.  She is also a Senior Fellow at the United Nations Foundation, and has taught at Columbia Law School and the University of Chicago Law School.  She attended Yale College and Columbia Law School, and subsequently clerked for Judge Dorothy W. Nelson on the 9th Circuit Court of Appeals.

Sue Biniaz speaking at Harvard Kennedy School, April 2018

In this podcast episode, we talk about Sue’s extensive experience in the climate negotiations.  Commenting on COP-25 in Madrid last December, after Sue had left the State Department, she takes note of the disappointment that surrounded the failure to reach agreement on the “Rulebook” (detailed guidance) for the one article (of twenty-nine) in the Paris Agreement which had not already been resolved:  Article 6, which deals with modes of international cooperation, and provides the potential home for linkage of policies in different countries, including so-called carbon markets:

“It was unfortunate that they didn’t reach agreement on Article 6.  I think the compromises were all pretty evident and they ran out of time. I think there wasn’t enough kind of political oomph put into it at the end. That’s an example of if the U.S. had been there at a political level, they would have been able to sort of bang some heads together and get it done.”

With COP-26 having been postponed from November 2020 to sometime in 2021, due to the COVID-19 pandemic, Biniaz believes that international climate negotiators may now wish to take advantage of this hiatus to consider ways to improve the annual climate talks.

“One of the reasons I think the COP needs to be re-thought is because I think the metric that’s been used by many people including the press has been the negotiating issues that are on the table,” Biniaz argues. “If you only look at those, it just puts too much pressure on what should be kind of a minor aspect of a COP compared to everything else that’s going on.”

With the U.S. elections looming in November, Biniaz says hopes are high that a new presidential administration will rejoin the Paris Agreement, and reengage in a productive way.

“If you’re going to rejoin the Paris Agreement, do it in a way that isn’t going to just be reversed four or eight years later. Try to make sure you have enough domestic buy-in so it’s harder for a future administration to just reverse it again,” she states. “And…if you’re going to come back into the agreement, try to use whatever leverage the United States has at that point to get other countries to do more.”

As you will quickly realize when you listen to this podcast episode, Sue Biniaz is not only very smart and exceptionally knowledgeable; she is also unusually clear and articulate.  You will not regret listening!

Sue Biniaz (center) with Todd Stern, then the U.S. lead climate negotiator, at COP-17 in Durban, South Africa, in 2011.

All of this and much more is found in the newest episode of “Environmental Insights: Discussions on Policy and Practice from the Harvard Environmental Economics Program.” Listen to this latest discussion here, where, by the way, you can also find a complete transcript of our conversation.

My conversation with Sue Biniaz is the tenth episode in the Environmental Insights series.  Previous episodes have featured conversations with:

“Environmental Insights” is hosted on SoundCloud, and is also available on iTunes, Pocket Casts, Spotify, and Stitcher.

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Three Pillars of a New Climate Pact

THE climate change summit at the United Nations on Tuesday, September 22nd,  is aimed to build momentum for the 15th Conference of the Parties to the UN Framework Convention on Climate Change in Copenhagen in December, where nations will continue negotiations on a successor to the 1997 Kyoto Protocol, which expires in 2012.   Later this week, the G20 finance ministers will meet in Pittsburgh, Pennsylvania, where international climate policy will be high on the agenda.

In the midst of this, Professor Sheila Olmstead of Yale University and I wrote an opinion piece which appeared as an op-ed in The Boston Globe on Sunday, September 20th.  (See the original here, with the artwork; and/or for a detailed description of our proposal, see our discussion paper for the Harvard Project on International Climate Agreements.)

In the op-ed, we argued that to be successful, any feasible successor agreement must contain three essential elements: meaningful involvement by a broad set of key industrialized and developing nations; an emphasis on an extended time path of emissions targets; and inclusion of policy approaches that work through the market, rather than against it.

Consider the need for broad participation. Industrialized countries have emitted most of the stock of man-made carbon dioxide in our atmosphere, so shouldn’t they reduce emissions before developing countries are asked to contribute? While this seems to make sense, here are four reasons why the new climate agreement must engage all major emitting countries – both industrialized and developing.

First, emissions from developing countries are significant and growing rapidly. China surpassed the United States as the world’s largest CO2 emitter in 2006, and developing countries may account for more than half of global emissions within the next decade. Second, developing countries provide the best opportunities for low-cost emissions reduction; their participation could dramatically reduce total costs. Third, the United States and several other industrialized countries may not commit to significant emissions reductions without developing country participation. Fourth, if developing countries are excluded, up to one-third of carbon emissions reductions by participating countries may migrate to non-participating economies through international trade, reducing environmental gains and pushing developing nations onto more carbon-intensive growth paths (so-called “carbon leakage’’).

How can developing countries participate in an international effort to reduce emissions without incurring costs that derail their economic development? Their emissions targets could start at business-as-usual levels, becoming more stringent over time as countries become wealthier. If such “growth targets’’ were combined with an international emission trading program, developing countries could fully participate without incurring prohibitive costs (or even any costs in the short term).  (For a very insightful analysis of such growth targets, please see Harvard Professor Jeffrey Frankel‘s discussion paper for the Harvard Project on International Climate Agreements.)

The second pillar of a successful post-2012 climate policy is an emphasis on the long run. Greenhouse gases remain in the atmosphere for decades to centuries, and major technological change is needed to bring down the costs of reducing CO2 emissions. The economically efficient solution will involve firm but moderate short-term targets to avoid rendering large parts of the capital stock prematurely obsolete, and flexible but more stringent long-term targets.

Third, a post-2012 global climate policy must work through the market rather than against it. To keep costs down in the short term and bring them down even lower in the long term through technological change, market-based policy instruments must be embraced as the chief means of reducing emissions. One market-based approach, known as cap-and-trade, is emerging as the preferred approach for reducing carbon emissions among industrialized countries.

Under cap-and-trade, sources with low control costs may take on added reductions, allowing them to sell excess permits to sources with high control costs. The European Union’s Emission Trading Scheme, established under the Kyoto Protocol, is the world’s largest cap-and-trade system. In June, the US federal government took a significant step toward establishing a national cap-and-trade policy to reduce CO2 emissions, with the passage in the House of Representatives of the American Clean Energy and Security Act (about which I have written in many previous posts at this blog). Other industrialized countries are instituting or planning national CO2 cap-and-trade systems, including Australia, Canada, Japan, and New Zealand.

Linking such cap-and-trade systems under a new international climate treaty would bring cost savings from increasing the market’s scope, greater liquidity, reduced price volatility, lessened market power, and reduced carbon leakage. Cap-and-trade systems can be linked directly, which requires harmonization, or indirectly by linking with a common emissions-reduction credit system; indeed, this is what appears to be emerging even before a new agreement is forged. Kyoto’s Clean Development Mechanism allows parties in wealthy countries to purchase emissions-reduction credits in developing countries by investing in emissions-reduction projects. These credits can be used to meet emissions commitments within the EU-ETS, and other systems are likely to accept them as well.

Countries meeting in New York and Pittsburgh this week, and in Copenhagen in December, should consider these three essential elements as they negotiate a new climate agreement. A new international climate agreement missing any of these three pillars may be too costly, and provide too little benefit, to represent a meaningful attempt to address the threat of global climate change.

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