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Lord Browne of Madingley: My Lords, for many observers, the Copenhagen accord, signed at last month's climate conference, is a failure. Targets for global emissions are conspicuously absent, and while national

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targets are included, they are set only on a voluntary basis. The failure to acknowledge an ongoing process for converting the accord into a legally binding treaty is disappointing. But despite falling short in these respects, the agreement makes significant progress in others. It commits all major polluters, not just developed countries, to take action on reducing emissions and to submit their plans to international oversight. The agreement enshrines a joint target to limit global warming to 2 degrees centigrade and it promises tens of billions of dollars for developing countries over the next decade, financed through private and public channels.

This momentum must not be lost. As we look to the next major climate change meeting in Mexico City and beyond, I believe that three points are critical. First, policy-makers must pay attention to the requirements of business, whose job it is to deliver the transition to a low-carbon economy. Direction setting is important, but until the Copenhagen accord is translated into detailed policies, it will fail to have an impact on investment decisions. From a business perspective, carbon offsets are a practical way to reduce emissions at low cost. Yet the current system is too bureaucratic and lacks sufficient scale to fund the commitments envisaged by Copenhagen. Reformed carbon offset mechanisms, along with new policies to leverage private capital such as loan guarantees, will be needed to mobilise flows of carbon finance across borders.

A second lesson is that expectations of what can be achieved through the current UN process need to be realistic. Big-tent multilateralism still makes sense in several areas; for example, transparency and adaptation funding. But differences of fundamental principle are best settled in smaller groupings involving heads of state, as demonstrated at Copenhagen. Deals to share low-carbon technologies may need to be brokered in even smaller groups or bilaterally. Initiatives within national borders, such as the promotion of strategic industries, should be given greater recognition and be learnt from by others. There is an opportunity to work with the Mexican Government, a member of both the Major Economies Forum on Energy and Climate and the G20, to develop a new multi-track approach.

This brings me to my third point. The UK must target its diplomatic influence effectively. We must be pragmatic about the areas where this country can have a real influence; for example, over the design of carbon markets and international financing mechanisms. Whatever one's political orientation, it makes sense to work much more closely with Europe on climate change matters. The EU is the world's third largest polluter and yet it was absent from the room when the decisive deal was struck. Europe needs to present a more ambitious, unified front if it is to have influence commensurate with its importance in combating climate change. I agree with the recent suggestion by William Hague that the EU should direct more of its budget towards climate change. The protection of tropical forests is one area where this enhanced funding could be effectively deployed.

With enduring political and financial support, I believe that the Copenhagen accord will go down as a cornerstone text in the history of mankind's efforts to

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combat climate change. To ensure that it does, my advice to policy makers is simple: keep the requirements of business in mind when drafting policies; embrace a new multi-track approach to climate diplomacy; and focus the UK's efforts where our influence is the greatest, working at the heart of Europe, not at its fringes.

1.11 pm

Lord Hunt of Chesterton: My Lords, I congratulate the noble Lord, Lord Stone, on introducing the debate and on his opening remarks in which he said that we should think about the political and social aspects of how people are reacting to these great events. I declare an interest as a member of Globe and as an emeritus professor of climate modelling.

On the Government's achievements, it was important that at Copenhagen there was an acceptance of the need to control global temperature by limiting emissions and preventing deforestation and that there should be help for developing countries. The mere fact that there was this accord at Copenhagen enables the United Nations system and all kinds of international bodies, businesses and industries to continue the general direction of work to reduce emissions, adaptation and work on the effects of climate change. If there had been a total failure, many of these important ongoing activities would have come to a stop.

However, there were some bad aspects and outcomes at Copenhagen. One of the features is that it was seen to be too much of a bureaucratic, governmental organisation. Some countries, particularly in the Far East, have realised that dealing with climate change requires visionary, practical, visible, symbolic changes. In Japan, the Prime Minister no longer wears a tie; in extremely hot conditions it has changed the temperature in its buildings. We still fail to do that in this building. Similarly, in China there is a one-child population policy, which, of course, has some flexibility, and there is no heating in buildings south of the Yangtze. It is incredible. These countries are making extraordinary gestures and we should recognise that those kinds of symbolic gestures help people to understand what the Governments are about.

At a political level there was great disappointment but, as the noble Lord, Lord Giddens, said, there was also an understanding that there was unrealistic optimism about the meeting. If Cassandra had tabled a PQ to ask, "What about this horse outside Troy?", undoubtedly the answer would have been, "Don't worry". I tabled a PQ and I went to China in May. It was absolutely clear what was going to happen: the Chinese published their climate change documents in English. These had not been read by anyone in Whitehall or by the Met Office. It was absolutely clear what was going to happen, and it happened.

This has led to political embarrassment for this and other countries. Why was no public warning given about this information? Why was there not some indication that a plan B was going to be necessary? Pretending to be optimistic to the last minute was not good politics and I hope that there will be a change of heart in that strategy when we come to the next phase.

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There were some disappointing features about the Copenhagen process from a scientific point of view. Once again, the only graph presented to decision- makers by the World Meteorological Organisation showed, as we have commented before, a flat value of the global average temperature in the past 10 years, and the only explanation that was given was "variability". We know what it was: the temperature was rising over the land and there has been a considerable reduction of temperature in the oceans because of the important dynamical processes that can happen over periods that may last 10 years. The way in which this was presented was unfortunate.

On a Statement made in this House on 5 January, the noble Lord, Lord Reay, commented that we could not believe any of these models because the Met Office cannot forecast this winter. That is the level of understanding with which we have to deal. It is true that variability, particularly in the UK, is difficult. In fact, the reason we have the best Met Office in the world is because we have the most variable climate-perhaps noble Lords had not realised that-and we have to deal with it. However, when the Met Office forecasts seasonal changes in other parts of the world it is sometimes 80 per cent or 90 per cent accurate. The Met Office has successfully modelled the change in climate and global temperature over the past 150 years and has related that to emissions. So, from the global point of view, we should accept this climatic science as being the basis for policy.

We need to work with other countries much more closely. The degree of scientific co-ordination with China needs to be considerably improved. Another important feature is that in order for countries around the world to deal with and make their own policies on climate change, they need to understand how the climate is varying. The level of data and information is inadequate, both within cities in developing countries and developed countries. For example, the World Bank is now promoting programmes of "metrics for sustainable cities". It is gratifying that the DfID programme, with the United Nations, is finally enabling African countries to improve their measurements so that we will have a more accurate understanding of what is happening and the effects of the changes.

It is very important that we work more closely with the United Nations system. Some noble Lords have commented that the United Nations is a broken reed and we should not deal with it, but all the agencies are working very closely together, whether on health, water, nuclear energy and so on. We must be positive about that and work closely with them.

1.17 pm

The Earl of Sandwich: My Lords, many of us remember Barbara Ward and the authors of the Brandt report, where we learned that world poverty is the responsibility of rich and poor acting together. Climate change is surely a new manifestation of this partnership. Even if no solution is in sight, our key objective must be to save lives in the short and long term. Many are even using the term "climate justice".

My starting point is, therefore, quite simple: how can this latest agreement improve the position of the poorest countries? These countries, which have been

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highlighted by the noble Baroness, Lady Jay, will certainly welcome the pledge of finance up to 2020, with the caveat she mentioned. Whatever the heading under which funds are raised, whether climate change or millennium development goals, they will be used to reduce poverty and ill health and to mitigate against many other effects of climate change. I congratulate UCL and the Lancet on their joint programme of research.

Climate change in the poorest countries is nothing new; it has simply been made worse by industrialised countries. That is all the more reason why those countries should take the major responsibility. This was the key plank of the Kyoto agreement. Carbon reduction is irrelevant in many parts of sub-Saharan Africa; climate change is not. Funding is rarely free of strings and this is where conditionality comes in. I have tried to learn the meaning of "adaptation" and have come up with, "adjustment in natural or human systems to a new or changing environment". "Mitigation" is defined as "any action taken to permanently eliminate or reduce the long-term risk and hazards of climate change to human life and property". Both definitions fit in with poverty reduction.

But what does, "in the context of meaningful mitigation" mean? Does it imply carbon cuts for these countries or can it equally apply to coping with the effects of climate change? It is still a confusing picture. If it means the former, there is a real risk that the funding will go to middle-income countries which qualify, and which can afford to set up their own mechanisms for reducing carbon emissions, and not to countries which may potentially be in greater need of assistance.

Copenhagen appears to place all the legal requirements for emissions cuts at national domestic level, with no legally binding international commitments. This pushes greater commitments on to developing countries, which have less responsibility and capacity to respond to climate change.

What therefore is the status of Copenhagen in relation to the Kyoto Protocol? Only 49 of the 192 countries in the process have signed the accord, and there are no new binding obligations or targets. I presume that those who did not sign the accord are not excluded from it. Perhaps the Minister could clarify that.

There are then the questions of new money, mentioned by the noble Baroness, Lady Jay, and additionality. Are the new funds simply a statement of intent? Donors' so-called "new" pledges often simply replace previous promises. The Government have pledged that no more than 10 per cent of official development assistance will be used for climate change. Have the Government committed to any financing that does not come from the aid budget, and do they plan to do so in the future? What are the current estimates of our aid funding in relation to climate change? What conditionality is attached? The definition of climate change, as we have seen, is fairly broad. From the recipient's point of view, labels can be meaningless. Accounting procedures in the poorest countries may not easily distinguish funds sent for different purposes.

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Something labelled "climate change aid" could equally mean "agriculture" and be recorded twice or not at all. Will the Government provide a definition of their budget lines that will be quite clear to those countries?

Unlike the right reverend Prelate, I am encouraged by the massive public interest generated by Copenhagen, even if it does not have all the answers. The noble Lord, Lord Stone, spoke of the highly focused NGOs-I mention also Saferworld and its new report on climate change and conflict in Kenya. There is a powerful lobby among NGOs. One organisation claims to be,

with nearly 4 million members. The climate change movement has therefore already commanded enormous support in the country.

1.22 pm

Lord Lea of Crondall: My Lords, for once, I can say that I am not being wise after the event, because I wrote an article for The House Magazine before Copenhagen on reasonable predictions and reasonable measures of success. I wrote:

"There are three complementary elements ... price/tax rises for [greenhouse gases] to choke off demand for carbon intensive forms of production and consumption ... promoting new low carbon technologies - and demand for their output - in the same timescale ... [and] an agreed financial formula or key"-

as the European Council put it-

I added:

"But the idea that in 2009 we can finalise in detail the financial mechanisms which can ensure that we meet hugely ambitious carbon tonnage reductions stretching to 2050 - and to which all future generations of politicians are bound by treaty - is a bridge too far. Indeed, there is a danger that we will denigrate what will in the longer term probably be seen as substantial progress. The multi-layered complexities of the exercise can only be compared with Rubik's cube. It is self-evidently an incremental one - a huge negotiation with 192 countries with 192 different economic attributes, whose energy emissions and outputs range from reliance on ruminant animals to nuclear power ... A rough guesstimate is that half the financing will come from the international carbon market and half from international public finance/tax, which of course means the taxpayers of Burton-on-Trent ... It is of decisive importance that the tax regime is not regressive; the average working person must not pay more percentage-of-income than the wealthy. This is a political necessity if the whole strategy is to succeed - but it is one to which so far insufficient attention has been paid. The EU Council is proposing that all the countries of the world- except the least developed-contribute to international public finance though a global distribution key, based on emissions totals and GDP. In practice this can be described as a carbon equalisation tax".

Those who are realistic-not NGOs, which just shout all the time from a pulpit without having any responsibilities-recognise that interests have to be reconciled in the world. The immediate priority for the UN mechanism in the next six or nine months is to look at the financial key in a quieter atmosphere. My only experience of the UN system is having been on the UN Commission on Transnational Corporations for about three years. You need on an ongoing basis to make sure that you have shop stewards from each part of the world in the lead-up arrangements; you cannot just leave it to top dogs to agree something when you have to deal, for instance, with Bolivia as well at the next meeting.

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Scientists have to be a little more respectful of the political process. The University of East Anglia episode was damaging. The Met Office has not done itself a favour by having been associated with a campaigning mode; indeed, the present top person there is a former head of campaigning at the World Wildlife Fund. I agree with the noble Lord, Lord Patel, in saying that population must be included. If we double the population in the next 20 years, we double the number of greenhouse gases. How can the Vatican say that it is now very involved in the process of sustainability while having a theologically dubious policy on contraception? I speak as a member of the European Parliamentary Forum on Population and Development, handing out condoms to women in villages in Niger. There is a demand there-it is not just western propaganda-and we have to bring that into the equation. We lack courage if we do not press that.

The noble Lord, Lord Stern, will speak later. I have great sympathy with the views put forward by Professor Dasgupta of Cambridge University on what is summarised as the discounting problem. He has written:

"Where the modern economist is rightly hesitant, the authors of the [Stern] Review are supremely confident. But their cause is not served when parameter values are chosen to yield desired answers".

Those are provocative words, but I gave notice to the noble Lord, Lord Stern, that I wanted to hear what he had to say about them.

1.28 pm

Lord Smith of Finsbury: My Lords, I declare an interest as chairman of the Environment Agency, the day-by-day work of which gives us direct experience and evidence of how our weather, our climate and our environment here in England and Wales are changing. We may not yet be able to attribute directly to climate change the fact that the most intensive rainfall in a concentrated period of 24 hours ever seen in England fell on Cumbria last November, causing, as we all know, the devastating floods that overwhelmed Cockermouth, Workington and Keswick, or the intense heat that is currently being experienced in Australia, or the droughts that have occurred recently in Kenya. However, there will be many more such events as change develops during coming years.

But there are smaller things, too, that are happening here in England. For example, damselflies and dragonflies are now found much further north, at higher altitudes and in greater numbers than ever before. There is a slim, rare, blue-green fish called the vendace, dating back to the ice age. It has disappeared from its stronghold in Bassenthwaite lake, and is having to be reintroduced further north in colder waters in Scotland. The coldwater arctic char is disappearing from Lake Windermere. Over the past 20 years, our testing of river water across England seems to indicate that there has been an average rise of water temperature in our rivers of 0.6 degrees centigrade over 20 years. These are small signals but, like the canary in the mine, signals of what may well happen in future. That is why Copenhagen was so important and why the outcome of Copenhagen was such a disappointment.

We knew that we were unlikely to achieve a legally binding treaty instantly, but I thought that we would be further along the road towards it than we now are.

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However, the worst possible response to Copenhagen would be to give up the fight and abandon the search for a clear international agreement at the very least among the major polluting countries. There is a real danger that some people will use the outcome of Copenhagen as an excuse for giving up the fight, while others will feel so frustrated that they will retreat from the challenge altogether. Others, as the noble Lord, Lord Stone, in his excellent opening remarks observed, will stop doing the little things that each one of us can do as individual citizens which, taken altogether, can make a genuine difference.

So what do we need to do? First, we need to press forward with every redoubled effort to achieve a firm international agreement and seek to do so before the end of this year. Secondly, as a nation we need to continue to do our own work to reduce emissions, even though it may not yet be clear what the rest of the world will be doing. That means developing carbon capture and storage and a new generation of nuclear power; it means investment in renewable energy and decarbonising as much electricity production as we can over the next 20 years. It means switching to electric vehicles and high-speed rail networks across Europe-and it means a major national programme of energy efficiency work. We should never underestimate not only the importance of doing all this as a country but the power of example. We must show here in the UK that these things are possible and that we can reduce emissions and seize the genuine willingness of the business community to change, find new ways of developing economic success and well-being and show how low-carbon prosperity can be achieved. If we do not continue to try to do that, no one else will.

1.33 pm

Lord Clinton-Davis: My Lords, it is a privilege to follow the noble Lord, Lord Smith of Finsbury, whom we have just heard. I congratulate my noble friend Lord Stone on raising this monumentally important issue. Certainly, the results of the Copenhagen conference were deeply disappointing. I share the view, on the other hand, that all is not lost. Without intense preparation, to conceive of a possibility of an agreement being reached with 192 participants was profoundly illusory. As it was, there was no commitment to produce a legally binding agreement, and this is unlikely at the next meeting in Mexico unless the major countries come to their senses and reach out for a worthwhile compromise. That would involve a change of mind and purpose, principally by China and the United States.

China must understand that, confronted by little or no change, she, like others, will face a catastrophic situation. Over time, no one will be spared. Among the other major players is the United States. Despite the advances contemplated by President Obama, an arid battle within Congress lies ahead. Some, perhaps a majority, of congressmen take the view that the United States will avoid the ill effects of climate change; I believe that they are utterly wrong. Some will argue falsely for the industries that they continue to champion. Others will say that action to combat climate change has to be taken immediately. All this amounts to a recipe for inaction.

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So is there no hope? I believe that there is, provided that the major polluters come to their senses soon, which is a big if. Surely we have to pose the argument that, even if at the end the sceptics are proved to be right, which I believe is an extremely remote possibility, what do we have to lose? Time, a great deal of money, the probable improvement of man's well-being? But if the sceptics are wrong and their myopia is unjustified, devastating consequences might be avoided. I believe that the sceptics are likely to be proved wrong and that urgent action needs to be taken. In my view, the noble Lord, Lord Stern, who we will hear from later, is absolutely right. The Mexicans, who are the hosts of the next conference, should take urgent action before it is too late and call together some 20 representative countries to work on a potential treaty. Nothing should be sacrosanct; all the outstanding issues should be confronted. Consensus needs to be built; time is not on our side; the future of the planet is at stake, and we have to think anew.

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