Climate change, energy and the international policy process
Vienna, 16.07.2007 - Binu Parthan
The beginning of the 21st century has seen an unprecedented level of interest in energy policy and the environmental problems associated with energy usage. What began as two separate policy issues, considered in different government departments and by different parts of businesses, have begun to converge at an accelerating pace.
It is now far harder than ever before to separate energy and environment issues and the majority of those involved would argue that this is a good thing. This stems in the main part from an increasingly sophisticated understanding that climate change is not a niche issue, rather it will have profound impacts on economic growth and development and in today’s globalising society the ramifications will be widespread.
In a recent article[1] for the BBC John Ashton, the
Energy itself has also become cause for concern. Energy security – the need to ensure a reliable supply of energy – has long been recognised as a pre-requisite for economic and social stability. Since the oil shocks of the 1970’s there have been mechanisms in place that have served to minimise the risk of disruption to the energy supplies of OECD countries, indeed the International Energy Agency was set up for this very purpose.
It is now accepted by all but the most marginal of scientists that current climate change is linked to man made emissions, the majority of which stem from reliance on fossil fuels. At the G8 Gleneagles summit last year all heads of state accepted that human activity contributes to climate change and that the focus now must be on reducing emissions of greenhouse gases. The main opportunity to do so lies in altering the ways in which we generate and use energy.
Heightened awareness of climate change and energy security on the one hand is matched on the other with the recognition that developing countries will need increasing amounts of energy to serve growing populations and raise living standards in line with the Millennium Development goals whilst all countries continue to need a secure supply of energy. In
This presents a dilemma with two horns. On the one hand we are consuming energy at a rate that is causing clear and demonstrable damage to the planet’s ability to sustain us, whilst on the other hand we desperately need to increase the amount of energy available to ensure a better standard of living for a huge number of people who do not have access and to fuel the economic growth of the rapidly industrialising countries such as China and India.
The World Summit on Sustainable Development (WSSD) held in
The international community has now begun, in a number of fora, to consider the issues surrounding energy, climate and development in a holistic way across a number of parallel processes. To be successful these processes will need to be mutually reinforcing and drive in a common direction, but there is a limited window of opportunity to get the balance right. The IEA predicts some $16 trillion will be invested in energy infrastructure up to 2030. If this quantity of capital is invested in conventional carbon intensive sources there is very little chance of stabilising atmospheric CO2 at a level that will avoid serious impacts from climate change based on current evidence. Even with the introduction of the policies and measures under consideration (as of 2005) global CO2 emissions will rise by 28% from current levels by 2030, with emissions from the developing world overtaking those of the OECD countries by 2020. It would likely be far cheaper to ensure that we avoid such levels of emissions than try to adapt to their consequences.
The most well know process is that of the United Nations Framework Convention on Climate Change (UNFCCC) and the Kyoto Protocol under which action has been taken forward. UNFCCC is essentially an ‘environment’ policy area, although the clear implications for energy policy have often led to compromises that have disappointed many environmentalists. None the less the Kyoto protocol is now ratified and the framework now exists to find a pathway to lowering emissions, ensuring that the burden of doing so is borne by those most responsible whilst aiding those with increasing demand for energy to find it in a sustainable way. Practical measures such as the clean development mechanism and emissions trading, increasingly adopted at a state and regional level, are being implemented and refined to ensure that agreements under the Convention can be adhered to.
In the meantime another part of the UN, the Commission for Sustainable Development (CSD) recently focused on energy. CSD 14 held in May 2006 and CSD 15 held in May 2007 focused on energy, climate change, industrial development and atmospheric pollution (CSD covers different topics for a two year period on a cyclical basis). At CSD14 the energy dilemma came to the fore. At CSD15 governments were unable to agree on clear means of implementation to take forward the commitments at WSSD, and with little sign of movement beyond what was agreed 5 years previously in
Although the UNFCCC has set a framework for potential emission reductions there is growing pressure for more immediate action and a plan to take us beyond the current 2012 targets. Outside of the UN system there is much activity afoot to try and accelerate the pace of progress.
In its 2005 presidency of the G8 group the UK government launched a process called the Gleneagles Dialogue on Climate Change, Clean Energy and Sustainable Development which brings together the major energy users of the future (i.e. it includes countries such as India and Brazil whose rapid economic growth means that they will see their demand for energy, and so potentially their greenhouse gas emissions rise substantially over the coming decades). The tile of this process indicates it seeks to address not only the environmental concern over climate change but also the wider economic implications for development, the need for developing countries to have access to cleaner technology and the necessity of maintaining energy security; thereby bringing together issues that have in the past been treated in isolation. The Gleneagles dialogue, which next convenes at ministerial level in autumn 2007, provides a space for countries to identify common ground and develop solutions and ideas that will help in meeting the wider objectives of processes such as the UNFCCC and UNCSD.
One thing all these processes have in common is recognition that there needs to be a new energy paradigm and a new economics surrounding energy that accounts for its true, global cost. What has started to emerge is a convergent set of concepts that look at tackling a set of common issues.
An approach has emerged that enables countries to identify practical measures that have worked for them and put them on the table for others to share. Under the UNFCCC there is now a Montreal Dialogue where similar discussions are conducted on sustainable development policies and measures. In the field of renewable energy the German government have successfully initiated a process to track countries’ and regions’ commitments and policies and have collated these into an International Action Plan, launched at the Bonn 2004 renewables conference. A subsequent
Technology co-operation is also seen as key, to share expertise and build global capacity. The Asia Pacific Partnership, launched in 2005, seeks to develop technologies across its members and there has been a lot of work under the UNFCCC to aid the transfer of technologies from developed to developing countries, although there are numerous issues surrounding intellectual property rights and the willingness of the private sector to invest in new clean energy technology and infrastructure in the absence of a clear long term framework for its promotion.
At the G8 Heiligendamm summit in June 2007 further progress was made towards reaching an agreement on future action, in addition the US announced a new process for technology co-operation that is intended to be complimentary to existing efforts under the UNFCCC.
Underlying the high level political processes and the government-to-government platforms there is already a raft of practical initiatives designed to help deploy the clean energy technologies that can provide solutions to the climate and energy security problems. Many of these focus on creating partnerships between the public and private sectors, recognising that it is the private sector which will invest the lion’s share of the necessary capital.
One of the most significant tools to emerge is the World Bank’s Energy and Investment Framework (EIF) for accelerating the growth of public and private investment into low carbon energy technology, increasing access to energy and adaptation to climate change. With the appropriate support from the Bank’s shareholders (i.e. governments) and the regional development banks the EIF has the potential to mobilise billions of dollars a year into clean energy investment.
All of this requires a significant increase in the human and institutional capacity of developing countries to attract international investment and mobilise domestic private sector finance. Organisations such as the Renewable Energy and Energy Efficiency Partnership (REEEP) are helping to build this capacity and to scale up and disseminate the best practice and experience in developing the necessary frameworks for policy, regulation and financing on a national and regional scale.
There is still a clear need for an overarching approach to controlling the environmental effects of energy use, especially in relation to its effect on our climate, but it is equally clear that this can not be done at the expense of development or growth, especially for those countries who have not historically been responsible for today’s high level of emissions nor by denying access to energy for those who currently suffer because they do not have it. Agreement on a multi-lateral scale has proved hard to achieve, but the sophistication of the arguments and the understanding of the interplay between these issues and the potential adverse effects of ignoring them is steadily increasing.
At the same time the on the ground work on new sustainable forms of energy is revealing that the cost of transition to clean energy may be far less that many feared and often this transition may result in new economic opportunities that afford even greater potential for growth than the conventional fossil fuel paradigm. The only question remaining is can the international policy process and the action on the ground work quickly enough to make the transition before the impact of our current energy consumption patterns becomes painfully clear.
[1] http://news.bbc.co.uk/2/hi/science/nature/5323512.stm
[2] http://www.who.int/indoorair/health_impacts/burden_global/en/index.html