Memorandum submitted by the World Development
Movement (CCB 17)
SUMMARY
1. The World Development Movement (WDM)
campaigns to tackle the root causes of poverty. With our partners
around the world, we win positive change for the world's poorest
people. We believe that charity is not enough. We lobby governments
and companies to change policies that keep people poor. WDM is
a democratic membership organisation of individuals and local
groups.
2. Climate change is a justice issue. It
has overwhelmingly been caused by the richest countries and people
in the world, yet it is the poorest who will suffer soonest and
most from its effects. WDM thanks the Environment, Food and Rural
Affairs Committee (EFRA) for initiating this inquiry on the Government's
draft Climate Bill and for the opportunity to submit written evidence.
Below we respond to some of the specific questions of the inquiry.
We address issues which are most important in ensuring that the
draft Climate Bill effectively limits climate change to prevent
the most catastrophic consequences for the world's poor.
3. The key points we make in this submission
are that the Climate Bill should:
— Ensure that the UK takes the
necessary action to keep the average global temperature increase
to 2°C. Current science implies this means a 40% cut in UK
emissions by 2020, and 80-90% by 2050.
— Include the UK's share of international
aviation and shipping CO2 emissions, and the non-CO2
emissions of aviation.
— Include three- rather than five-year
budget periods, with annual milestones to ensure there is an emissions
reduction trajectory.
— Ensure an 80-90% emission reduction
is achieved through actual emission cuts in the UK, not through
"buying" emission cuts elsewhere in the world. Funds
for low carbon development in developing countries should be provided
in addition to cuts in UK emissions, not instead of cuts in UK
emissions.
— Include an expert on the impacts
of climate change on poor people in developing countries on the
Committee on Climate Change.
TARGETS
(i) The validity of the Government's domestic
targets to
— reduce CO2 emissions
by 60% below 1990 baseline levels by 2050, and
— reduce CO2 emissions
by 26-32% below 1990 baseline levels by 2020.
4. The Government is right to set unilateral
targets for reducing UK emissions. While it is true that climate
change cannot be solved by UK action alone and that action by
other countries is required, it is also true that the UK has historically
been a significant cause of the problem and thus has a moral obligation
to take the lead in reducing emissions.
5. There is a further political imperative
for unilateral action which is the need to secure an international
agreement on greenhouse gas emissions reductions. Such an accord
needs to include more advanced developing countries (eg China)
who will be reluctant to sign-up unless they see those principally
responsible for the problem in the industrialised world demonstrating
a willingness and ability to take action.
TARGET 60% BY
2050 AND A
FURTHER INTERIM
LEGAL TARGET
FOR 2020 OF
26-32%
6. The UK Government has rightly stated
that its goal must be to prevent what has become known as "dangerous
climate change"; in other words preventing average global
temperatures from rising more than 2°C on pre-industrial
levels.[11]
This 2°C threshold is widely regarded as a point beyond which
the impacts of climate change, particularly on the poorest people
in the world, will become truly catastrophic.
7. The objective of staying within the 2°C
threshold should be clearly stated and made a central part of
the bill. The rest of the bill should be constructed as the framework
for making the UK's contribution to achieving this overarching
objective. Therefore the size of the cuts needs to be in line
with the latest science relating to what action is required from
industrialised countries like the UK in order to keep global temperatures
from rising more than 2°C.
8. While supporting the concept of setting
both long-term and interim legal targets, WDM is concerned that
the actual targets included in the draft Bill are already out
of date. Beyond political expediency, it is hard to find a justification
for the "26-32% by 2020 and 60% by 2050" formula.
9. The May 2007 IPCC summary report on mitigation
outlined that for the average global temperature increase to be
kept to 2.0°C-2.4°C requires stabilisation at 445-490
ppm of CO2eq in the atmosphere. This in turn requires global yearly
emissions to be reduced by 50-85% by 2050.[12]
Because the UK emits more than double the worldwide average CO2
per person, the UK has to reduce emissions by between 80-90% by
2050, on current levels. This translates into a 40% cut by 2020.
10. There is a powerful rationale for ensuring
that the Bill includes a more realistic, science-based, target
from the outset. It is likely that once the Bill is passed, and
the first five-year budget set, there will be a high degree of
political inertia when it comes to amending it. If the political
will then exists to revise the target after the first period,
this will create the need for much steeper cuts during the second
and third budget periods. For all stakeholders concerned (including
political parties) it makes better sense to include a more accurate
target in the bill from the beginning.
TARGETS DO
NOT COVER
ALL CO2 OR
NON-CO2 EMISSIONS
11. The draft Climate Bill does not cover
all UK contributors to climate change. The draft Bill excludes
CO2 emissions from international aviation and shipping,
based on the premise that these emissions are not part of the
existing Kyoto Protocol, and that disagreement exists internationally
over whether and how to account for and reduce these emissions.
Provision is made in the bill to include these emissions at some
future date if such an international deal can be struck.
12. The draft Climate Bill also excludes
non-CO2 contributors to climate change, such as emissions
of nitric oxide, nitrogen dioxide and water vapour by aviation
at altitude. These emissions cause aviation to make a greater
contribution to climate change than CO2 alone. The
Treasury's pre-budget report in 2006 stated that aviation makes
a contribution to climate change 2 to 4 times greater than CO2
emissions alone.[13]
The Department for Transport uses a figure of 2.5 times more warming
from UK aviation than CO2 alone.[14]
13. In the attached report "Emissions
invisible: The impact of excluding international aviation from
the Climate Bill" we show that:
— Aviation is already a large
part of the UK's contribution to climate change:
— Aviation currently accounts for 12.4%
of the UK's contribution to climate change,
— This is more than cars (9.3%), home
heating (11.1%) or manufacturing and construction (11.3%).
— The Climate Bill will only result
in a small reduction in the UKs contribution to climate change:
— The Climate Bill targets a reduction
in UK CO2 emissions of 60% by 2050 on 1990 levels.
This does not include most aviation emissions,
— The UK Government is currently supporting
a massive expansion in UK aviation,
— By 2050, the Climate Bill as currently
drafted will only result in a 17% reduction in the UK's contribution
to climate change on 2005 levels (24% reduction on 1990 levels).
— The Climate Bill expects reductions
in emissions from all other sectors of the UK economy, but allows
aviation to continue increasing its emissions:
— Aviation will account for almost
half the UK's contribution to climate change by 2050,
— Aviation's contribution to climate
change will have increased by 213% by 2050,
— Road transport's contribution to
climate change will have decreased by 56% by 2050,
— The richest 18% of the UK population
are responsible for 54% of flights. It is unjust to exclude aviation
from being required to cut emissions while requiring emissions
reductions in other sectors.
— Excluding aviation from the
Climate Bill does not make scientific, economic, social or political
sense:
— Scientific evidence points towards
the urgency of reducing emissions in the next decade so planning
to increase aviation emissions is foolish,
— There is no economic justification
for requiring other sectors to reduce emissions while encouraging
an increase in aviation emissions,
— Aviation is used predominantly by
more wealthy people in the UK. Curbing the increase in aviation
emissions could be more socially progressive than other actions,
— Delaying action until the aviation
sector is larger and employs more people will only make future
political decisions harder.
14. All of the UKs CO2 and non-CO2
greenhouse gas emissions must be included within the scope
of the Bill from the outset. The Government must take action to
curb the growth in these emissions rather than postponing full
inclusion of aviation until some future date when a possible international
accord might have been reached and UK aviation emissions are significantly
larger and need to be cut.
(iii) The rationale for a five-year budgetary
period
15. WDM supports the idea of budget periods
in order to provide a degree of certainty relating to government
action on climate change. However, we are concerned that the proposal
for a five-year carbon budget cycle has several flaws.
16. The first is that the UK's mitigation
effort is more likely to be effective if public interest and political
momentum can be maintained. WDM is concerned that five-year budget
periods could result in difficult decisions being postponed. With
the budget period spanning the electoral cycle there is some potential
for buck-passing from one administration to another. Also, in
terms of accountability, changes of Minister, Secretary of State
or even Prime Minister can be important and five-year budget periods
increase the likelihood of what could effectively be buck-passing
between individuals within government.
17. A second flaw is that five year budget
periods make it more difficult to quickly incorporate the evolving
science of climate change into decision-making. Although the bill
rightly creates a review mechanism, once a five-year budget has
been set there is likely to be a degree of political inertia in
changing it. This would probably mean that responses to enhanced
scientific evidence (if that evidence points to the need for deeper
emissions cuts) are delayed until the next five-year budget period.
18. This also relates to the third flaw
(see Figure 1). The proposed five-year budget period, with a target
to achieve lower average emissions over that period, results in
an odd emissions reduction trajectory. After every five years
a sudden and significant emissions cut is needed. Creating a system
that requires such large steps in emission reduction seems unnecessary
and unrealistic.
19. As a way to ameliorate these three flaws,
WDM argues that a more sensible route to pursue would involve
three year budget periods and a requirement to set annual milestones
that produce a trajectory of emissions reduction.
20. The type of budget system suggested
above would be more likely than a five-year budget system to mean
that:
— The same government will see
through at least one full budget period.
— Within a government, the same
individuals (Minister, Secretary of State, Chancellor, Prime Minister)
see through one or two budget periods.
— The emissions reduction trajectory
and future budgets can be more easily modified to suit the evolving
science.
— The emissions reduction trajectory
is smoother.
CARBON BUDGETING
7. The facility to purchase carbon credits
from outside the UK to meet domestic targets, in terms of their
overall quantity and sources
21. The draft Climate Bill proposes that
the UK could purchase carbon credits from abroad in line with
the limits set out under international law. The "limits"
set out under international law are that the UK could purchase
up to 50% of its greenhouse gas reduction effort from overseas.
Therefore, within the proposed framework of the Bill (which we
argue needs to change) the UK should reduce its CO2
emissions from 556.2 million tonnes to 235.7 million tonnes by
2050. But up to half of this effort (160.25 million tonnes) could
be purchased from abroad.
22. The argument that it is cheaper, easier
and thus more efficient to buy CO2 emissions reductions
in developing countries and that this is legitimate because it
makes no difference where emissions reductions are made
sounds fine in theory but in practice is riddled with problems.
23. It is notoriously difficult to monitor
and verify emissions reductions in the developing world. Under
the Kyoto protocol's Clean Development Mechanism (CDM) the largest
number of carbon credits have been generated by projects claiming
to reduce the gas HFC-23, rather than CO2. One study has found
that the value of credits given to HFC-23 projects at current
carbon prices is €4.7 billion. However, an estimate of the
cost of technology needed to capture and destroy the same amount
of HFC-23 is €100 million.[15]
Around €4.6 billion has been generated in profit by HFC-23
generating plants, which could then further expand their operations
with the reinvestment of this profit.[16]
24. One Indian chemical company, SRF, made
€87 million from the sale of carbon credits in 2006-07. Ashish
Bharat Ram, managing director of SRF, claimed "Strong income
from carbon trading strengthened us financially, and now we are
expanding into areas related to our core strength of chemical
and technical textiles business."[17]
25. Mandatory regulations should exist stating
that companies have to capture and destroy HFC-23, especially
given the low cost of doing so. However, if such regulations exist
in a country, then a company cannot claim carbon credits as they
would not be viewed as "additional". The existence of
the carbon market creates a perverse incentive for governments
not to regulate HFC-23, so that companies can make a windfall
profit by selling credits.
26. Such problems mean that incorporating
"purchasing overseas effort" within the Bill is creating
a major loophole that could render the Bill ineffective in addressing
the UK's contribution to climate change.
27. WDM is also concerned that, if towards
the end of a budget period, the Government is off-track, this
loophole will enable it to divert a portion of the aid budget
into schemes overseas. This creates a political "get out"
clause that enables Ministers to delay or even avoid completely
the decisions necessary for the UK's transition to a low-carbon
economy.
28. WDM argues that the UK needs to make
reductions in UK emissions of up to 90% .The UK's historical contribution
to climate change means that this country has a moral responsibility
to reduce its own emissions. On top of, rather than instead of,
this emissions reduction it is vital that the UK plays its part
in creating the conditions for low carbon development in developing
countries, including through technology and financial transfers.
COMMITTEE ON
CLIMATE CHANGE
11. Its composition and appointment, including
length of tenure and degree of independence
29. WDM believes that the Committee should
comprise experts from different fields and that no particular
area of expertise, especially those unrelated to the science of
climate change (eg, economics), should be over-represented. The
key to a successfully functioning Committee will be achieving
the right balance of expertise to achieve the objective of advising
the Government on emissions reductions targets, budgets and pathways
based on the science of climate change.
30. WDM thinks it would be unwise to create
seats on the Committee for representatives of particular interest
groups (eg, business representatives, unions or NGOs). This would
potentially detract from the focus of the Committee. It is up
to government to weigh up different points of view and then act
in the broader public interest when it comes to implementing policies
to achieve the necessary emissions reductions.
31. Climate change is a global issue and,
while people in the UK and other European countries will certainly
be affected, the imperative for mitigating climate change is much
greater and more urgent when considering the potential impacts
on poor people in developing countries.
32. WDM suggests that the Committee on Climate
Change should include an expert on the impacts of climate change
on poor people in developing countries. We believe this would
go some way to ensuring that the latest evidence on climate change
impacts in the global south would be reflected in the Committee's
deliberations and conclusions.
33. Also, WDM is concerned that the focus
of the draft Bill leans heavily towards the use of emissions trading
schemes. Not only could this make reporting on actual emissions
reductions very complex and confusing (due to the inclusion of
credits purchased overseas in some emissions trading schemes),
it could undermine the achievement of the Bill's targets given
the poor performance of emissions trading in delivering greenhouse
gas reductions to date.
34. This focus on emissions trading is reflected
in the fact that an emissions trading expert is proposed for inclusion
on the Committee while experts in other areas of climate mitigation
policy are not. In addition to an expert on emissions trading,
WDM would like to see included on the Committee an expert on environmental
taxation, an expert on environmental regulation and an expert
on the use of subsidies/incentives.
ENABLING POWERS
16. The adequacy and implications of the proposed
enabling powers allowing the Secretary of State to establish greenhouse
gas emission trading schemes by means of secondary legislation
35. As already mentioned, WDM is concerned
that the Government does not become overly reliant on emissions
trading schemes whether domestic, pan-European or international.
Current experience suggests that, while seemingly attractive in
theory, the European emissions trading scheme has to date been
ineffective at actually reducing emissions.[18]
36. It is important to recognise up-front
that the "market" as it is currently constructed will
not deliver the greenhouse gas reductions needed to avert dangerous
climate change. The Government therefore needs to use all potential
mechanisms available—including taxation, subsidies and regulation—to
correct what the Stern report rightly called the world's biggest
market failure.[19]
Critically, the government needs to be responsive to measures
that are not working or inadvertently create perverse incentives.
If a policy is not achieving greenhouse gas emissions reductions
that help the UK contribute to the 2°C target it should be
changed or scrapped. Becoming too attached to single solutions
or perceived "silver bullets" is potentially risky considering
the urgent need to mitigate climate change.
INTERNATIONAL IMPLICATIONS
17. The validity of the Government's view
that the Bill will act as an effective example to drive international
climate change policy post-2012
37. Effective international climate policy
requires rich countries to take a lead in reducing emissions.
The unilateral action which the draft climate bill commits the
UK to can help secure international agreement on emission controls
and reductions.
38. As already outlined, there are a number
of ways in which the bill needs to change in order to be an effective
example:
— It must include all international
transport emissions, and the non-CO2 impacts of aviation
on global warming.
— It must put the need to keep
to 2°C at the forefront of policy, and base reduction targets
on what is required for the UK to do its fair share in meeting
global emission reduction targets. On the basis of current science,
this means a target of an 80-90% reduction by 2050.
— It must set-out an accountable
budgeting system and a trajectory for emissions reduction. A three-year
budgeting system and annual milestones would enable this to happen.
World Development Movement
May 2007
11 HM Government. (2006). Climate change: The UK
programme 2006. March 2006. Back
12
IPCC. (2007). Climate Change 2007: Mitigation. Summary for Policymakers.
Contribution of Working Group III to the Fourth Assessment Report
of the Intergovernmental Panel on Climate Change. 04 May 2007. Back
13
HM Treasury. (2006). 2006 Pre-Budget Report: Investing in Britain's
potential-Building our long term future. HM Treasury. London.
06 December 2006. Back
14
Department for Transport. (2004). Aviation and global warming.
Department for Transport. London. January 2004. Back
15
Harvey, F Bryant, C and Aglionby, J (2007). Producers, traders
reap credits windfall. Financial Times. London. 26 April
2007. Back
16
Smith, K (2007). Pollute and profit: So when will Brussels admit
that its emissions trading scheme is not only not working, but
has proved a disaster? Back
17
Smith, K (2007). Pollute and profit: So when will Brussels admit
that its emissions trading scheme is not only not working, but
has proved a disaster? Back
18
EAC. (2007). The EU Emissions Trading Scheme: Lessons for the
Future. House of Commons Environmental Audit Committee. Second
Report of Session 2006-07. 01 March 2007. Back
19
Stern Review. (2006). The economics of climate change: Executive
summary. HM Treasury. London. October 2006. Back
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