Supplementary memorandum submitted by
Rt Hon Edward Miliband MP, Secretary of State for Energy and Climate
Change
During my appearance before the Environmental
Audit Committee on 10 March, where I gave evidence on the international
climate change negotiations, I agreed to follow up in more detail
on three specific issues.
1. ANALYSIS OF
PLEDGES
You asked for more on the analysis of pledges
made under the Copenhagen Accord. Annex 1 sets out the published
and DECC research that estimates what 2020 emissions the Accord
commitments could lead to. This analysis shows that if those countries
that have put forward emissions reduction targets and actions
in the Accord deliver at the highest end of the ranges they have
offered this would put us on a pathway to our 2°C goal, but
will require significant and more expensive action after 2020.
2. REDD+
The Committee also requested the wording agreed
at COP15 around REDD+, in particular what was agreed on protecting
the rights of indigenous people and protecting natural forests.
Because of how COP15 ended, the main draft REDD+ decision text
was not adopted and so is not yet formally agreed. The square
brackets around some text indicates those areas that were still
under discussion by the informal negotiating group on REDD+ during
its final session. The document was "banked" following
Copenhagen, and will form the basis for the continued efforts
to reach agreement during 2010.
The full document is publicly available on the
UNFCCC website (http://unfccc.int/resource/docs/2010/cop16/eng/02.pdf),
but the draft text relevant to protecting indigenous people (including
protection of natural forests) and on social safeguards is attached
at Annex 2 of this letter.
COP15 did successfully agree a decision, forwarded
from the Subsidiary Body for Scientific and Technological Advice
(SBSTA), on methodological issues to do with REDD+. The preamble
and paragraph 3 of this decision recognise the need for full and
effective engagement of indigenous peoples and local communities
in monitoring and reporting, and encourage development of guidance
for this. The relevant text is attached at Annex 3 of this letter.
The UK Government welcomes this text, which
is consistent with the objectives we set out in "The Road
to Copenhagen", published in June 2009.
3. CORUS TEESSIDE
PLANT—CARBON
ALLOWANCES
The final issue I agreed to provide further
information on was regarding carbon markets and the Corus Teesside
plant. The partial mothballing of the Corus Teesside plant is
a commercial decision for Corus and they have indicated that the
decision was driven by the early cancellation of a 10 year agreement
with an overseas consortia that was purchasing around 80% of the
steel slab production.
Corus have stressed that this is not a permanent
closure as they intend to retain the asset with a view to restarting
steel production if economic conditions improve. Under the current
EU Emissions Trading System rules, the Corus Teesside plant will
retain its free allocation of allowances for 2010. The Government
has a duty to issue allowances to installations covered by the
EU ETS by 28 February each year. The allocations for 2010 have
thus been issued and allowances for the Teesside plant are now
the property of Corus. What happens to any surplus carbon allowances
in 2010 as a consequence of the partial mothballing is a commercial
decision for Corus.
Future annual allocations will depend on the
extent to which the site has closed all its operations covered
by the EU ETS. Even though Corus have mothballed steelmaking activities
on the site they plan to keep open a number of EU ETS qualifying
activities—coke ovens and some power generating capacity—and
will be required to surrender allowances to cover these emissions.
Corus will be required to keep the Environment Agency, as the
EU ETS Regulator, updated with any further changes at the plant.
It is important to remember that this will not
affect the total quantity of allowances under the EU ETS cap,
and so will not reduce the environmental effectiveness of the
EU ETS in tackling dangerous climate change. However, it does
highlight a problem with giving companies a free allocation of
allowances and the need for changes in the rules for Phase III
(2013-20).
From 2013, there will be substantial changes
to the allocation of allowances which will address this issue
in two ways. Firstly, there will be a large increase in the number
of allowances that are auctioned, up from 3% currently to around
50%. This means that the amount of free allocation will be significantly
reduced and will help to address windfall profits. Secondly, for
companies that continue to receive free allowances, benchmarks—where
feasible—will establish the level of effort companies will
have to make to reduce emissions. Benchmark levels will be based
on the average performance of the top 10% most efficient installations
in a sector/sub-sector, which is likely to mean that around 95%
of firms in industrial sectors will need to reduce emissions or
buy allowances. In addition, there will be a new closure rule,
that will mean that any free allocation to installations will
be reduced if they are considered to be partially closed.
29 March 2010
Annex 1
ANALYSIS OF PLEDGES MADE UNDER THE COPENHAGEN
ACCORD
Several groups of researchers have released
assessments of the submissions to the Appendices of the Copenhagen
Accord. A summary of what these studies suggest about 2020 emissions
(Gt CO2-eq/yr) is shown in the table below.
Organization/Computational Tool
| Low estimate
(with high pledges)
| High estimate
(with low pledges)
|
| Analysis by DECC | 48 | 49.4
|
Grantham Research Institute on Climate Change and the Environment[6]
| 46.7
| 49.2 |
Ris' Centre on Energy, Climate and Sustainable Development/Climate Pledge Tracker[7]
| 48 | 49.9 |
Ecofys, Climate Analytics, Potsdam Institute for Climate Impact Research/Climate Action Tracker[8]
| 52.0* | 54.8* |
PWC[9]
| 48.3** | 50.3** |
Project Catalyst[10]
| 49 | 53 |
Trevor Houser[11]
| 48.2 | 51.5 |
* Includes potential risks arising from LULUCF rules and surplus emissions allowances from previous commitment periods.
|
| Low estimate excludes anthropogenic peatland emissions (around 1.5Gt).
|
| ** potential 1Gt double counting of offsets.
|
| |
|
Any such analysis has to deal with a number of uncertainties,
and different approaches to dealing with these lead to the differences
between these assessments. There is uncertainty about the business
as usual growth in emissions against which developing country
domestic actions and intensity targets are benchmarked. There
is also uncertainty as to the way countries meet their targets,
including the use of international offsets to meet Accord targets
which could lead to double counting, and LULUCF credits (where
the accountancy rules are yet to be set but which may mean lower
emissions if not used, but displace mitigation on other sectors
if used extensively). The estimates also sometimes do not assume
full delivery (or delivery supported by offsets) or greater levels
of mitigation supported by the proposed international carbon finance.
Also some analyses examine the increase in emissions that could
occur if surplus credits from earlier commitment periods are used
to meet 2020 targets.
So depending on how these uncertainties (BAU emissions, role
of international finance) and risks (LULUCF rules, surplus allowances
and double counting) are resolved will determine the accuracy
of these estimates. The DECC analysis assumes full delivery of
targets in the low estimate (high pledges) but only partial delivery
in the high estimate (low pledge case) which could be caused by
double counting, a lack of international support or poor policy
delivery. It also assumes that the risks around surplus allowances
and LULUCF rules do not undermine commitments but that there is
no additional mitigation from the LULUCF sector that isn't counted
towards mitigation.
The biggest difference between the analyses of the Copenhagen
estimates lies in the way they are linked to potential temperature
outcomes. The Climate Action Tracker and another website, Climate
interactive Scoreboard,[12]
model the outcome by also using other commitments after 2050.
As most countries do not have 2050 commitments they see emissions
continue to rise after 2020 and hence their models suggests high
levels of warming, 3.5°C or more. The PWC, Project Catalyst
and Ris analysis compare the emissions against what they view
as an appropriate 2°C trajectory (40Gt, 44Gt and 44Gt respectively).
Trevor Houser's analysis takes a different approach as it
explores whether strong reductions from 2020 Accord numbers can
lead to a 2°C trajectory, concluding that this is possible.
The Grantham Research Institute research states that emissions
should be between 40Gt and 48Gt for a plausible 2°C trajectory
and that a climate responsible level would be near to 44Gt. Emissions
of 48Gt in 2020 would require annual global emission reductions
of 4% each year from 2020-50 whereas 44Gt would require 3.3% each
year over the same period. It states that "The submissions
to the Copenhagen Accord to date represent a slow start that can
still be compatible with a path towards the 2°C. But
a slow start will require even stronger global action after 2020,
which is likely to be more expensive and riskier than a strong
start." An analysis by the AVOID consortium[13]
on what the Hadley Centre climate model suggests about trajectories
to 2°C from the Copenhagen Accord numbers also suggests that
2°C require strong global mitigation after 2020 and that
limited action would lead to higher levels of warming.
Our interpretation of these analyses is that they all show
that the Accord numbers represent a significant deviation from
business as usual and that ideally we would have delivered more
mitigation that would put us on a more robust path to 2°C
or lower. If delivered in accordance with countries highest intentions,
they could put us on a credible pathway to achieving the 2 degrees
goal so we must help support effective delivery of these commitments
and explore opportunities for further reductions up to 2020 and
beyond.
Annex 2
COP15 WORDING FROM THE DRAFT REDD+ DECISION RELEVANT TO
PROTECTING INDIGENOUS PEOPLE
"2. Further affirms that when undertaking
activities referred to in paragraph 3 below, the following safeguards
should be promoted and supported:
(a) Actions complement or are consistent with the objectives
of national forest programmes and relevant international conventions
and agreements.
(b) Transparent and effective national forest governance structures,
taking into account national legislation and sovereignty.
(c) Respect for the knowledge and rights of indigenous peoples
and members of local communities, by taking into account relevant
international obligations, national circumstances and laws, and
noting that the General Assembly has adopted the United Nations
Declaration on the Rights of Indigenous Peoples.
(d) Full and effective participation of relevant stakeholders,
including, in particular, indigenous peoples and local communities
in actions referred to in paragraphs 3 and 5 below.
(e) Actions that are consistent with the conservation of natural
forests and biological diversity, ensuring that actions referred
to in paragraph 3 below are not used for the conversion of natural
forests, but are instead used to incentivize the protection and
conservation of natural forests and their ecosystem services,
and to enhance other social and environmental benefits.[14]
(f) Actions to address the risks of reversals.
(g) Actions to reduce displacement of emissions."
Sub-paragraph 5(c), and paragraphs 7, 11 and 12 refer to the
safeguards listed in paragraph 2 including those relevant to forest
conversion and indigenous peoples. These text elements are:
"5(c) [A robust and transparent national forest
monitoring system for the monitoring and reporting of the activities
referred to in paragraph 3 above[, and the safeguards referred
to in paragraph 2 above], with, as appropriate, subnational monitoring
and reporting as an optional interim measure, in accordance with
the provisions contained in decision x/CP.15 (SBSTA decision)
and any further elaboration of those provisions agreed by the
Conference of the Parties;]
7. Requests developing country Parties, when
developing and implementing their national strategies or action
plan, [or subnational strategies] to address, inter alia, drivers
of deforestation and forest degradation, land tenure issues, forest
governance issues, gender considerations and the safeguards identified
in paragraph 2 above, ensuring the full and effective participation
of relevant stakeholders, inter alia, indigenous peoples and local
communities;
11. [Requests the Subsidiary Body for Scientific
and Technological Advice to develop, at its [xx] session, modalities
for measuring, reporting and verifying the support provided by
developed country Parties to support the implementation of safeguards
and actions referred to in paragraphs 2 and 3 above;]
12. [ Requests that the promotion and implementation
of all activities referred to in paragraphs 3, 5, 7 and 8
above, including consideration of the safeguards referred to in
paragraph 2 above, and early action, be supported in accordance
with [paragraph 1 (b) above and] relevant provisions agreed by
the Conference of the Parties including:
(a) [Decision x/CP.156 (finance);]
(b) [Decision x/CP.157 (1 (b) (v)),] [for result-based actions
a flexible combination of funds and market-based sources subject
to modalities to be agreed by the Conference of the Parties at
its [xx] session];
(c) [through existing bilateral and multilateral channels;]]."
Annex 3
SUBSIDIARY BODY FOR SCIENTIFIC AND TECHNOLOGICAL ADVICE
(SBSTA) DECISION ON REDD+ METHODOLOGIES
DRAFT DECISION
/CP.15
Methodological guidance for activities relating to reducing
emissions from deforestation and forest degradation and the role
of conservation, sustainable management of forests and enhancement
of forest carbon stocks in developing countries.
The Conference of the Parties,
Recalling decisions 1/CP.13 and 2/CP.13,
...
Recognizing the need for full and effective engagement
of indigenous peoples and local communities in, and the potential
contribution of their knowledge to, monitoring and reporting of
activities relating to decision 1/CP.13, paragraph 1 (b) (iii),
3. Encourages, as appropriate, the development
of guidance for effective engagement of indigenous peoples and
local communities in monitoring and reporting;
6
For information, the UNEP/LSE report is available at http://www.unep.org/PDF/PressReleases/Accord_targets_paper.pdf Back
7
http://www.unep.org/climatepledges/ Back
8
http://www.climateactiontracker.org/ Back
9
http://www.ukmediacentre.pwc.com/Content/Detail.asp?ReleaseID=3571&NewsAreaID=2 Back
10
http://www.project-catalyst.info/images/publications/project_catalyst_taking_stock_february22_2010.pdf Back
11
http://www.iie.com/publications/pb/pb10-05.pdf Back
12
http://climateinteractive.org/scoreboard Back
13
Analysis available at http://www.avoid.uk.net/ Back
14
"[Taking into account the need for sustainable livelihoods
of indigenous peoples and local communities and their interdependence
on forests in most countries, reflected in the United Nations
Declaration on the Rights of Indigenous Peoples and the International
Mother Earth Day.]" Back
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