David Hone

We tend to think of climate change as a relatively modern issue, perhaps marked by the testimony before Congress of James Hansen in summer 1988.  The terms “climate change” and “global warming” hardly appear in literature before 1975 and didn’t really take off until the mid-1980′s. 

There is of course Svante Arrhenius who published on the role of carbon dioxide in 1903 and even some others before that. There was certainly research on the issue throughout the 20th Century, including the work of Keeling and Callendar. But this week I was prompted to read a bit about the Revelle Factor (ocean uptake of CO₂, more basic research in the 20^th Century) and came across the following publication, endorsed and signed in 1965 by then President Lyndon Johnson and produced by the President’s Science Advisory Committee. It is a review on the then current state of the environment with a focus on pollutants. To my surprise, contained within it is a lengthy chapter on the rising levels of CO₂ in the atmosphere from the use of fossil fuels and its impact on global temperature. Was this the earliest political prompt on the issue from the science community?

In the days before computer models, climate lobbyists, sceptics, warmists and the pseudo-scientists who claim to have deep and insightful knowledge of atmospheric physics and chemistry (a.k.a. a variety of journalists, hobbyists, lawyers, political figures and others) which the atmospheric physicists themselves “apparently don’t have”, here is a first (??) thoughtful introduction and analysis by the science community, published by the United States Government on an issue that has become paramount today. It makes for interesting reading.

The paper looks at the atmospheric build up of CO₂, the likely further build up by 2000 as fossil fuels continue to be consumed, expected temperature rises, the possible impact on global sea levels as ice caps melt and concludes;

The climatic changes that may be produced by the increased CO₂ content could be deleterious from the point of view of human beings.

Perhaps the most surprising aspect of the chapter on Atmospheric Carbon Dioxide is the discussion on a geoengineering solution. The above conclusion goes on to say;

The possibilities of deliberately bringing about countervailing climatic changes therefore need to be thoroughly explored. A change in the radiation balance in the opposite direction to that which might result from the increase of atmospheric CO2 could be produced by raising the albedo, or reflectivity, of the earth . . . . . . .

Nearly fifty years later, not a great deal has been done in response to all this, although climate science has certainly advanced. But in his opening remarks, President Johnson calls for “highest priority of all to increasing the numbers and quality of the scientists and engineers working on problems related to the control and management of pollution“. The fact that some in our society have chosen to demonize these people and even mock their work is a sad state of affairs.  Tackling climate change means we need more scientists, with society fully behind young people focusing on science, technology, engineering and mathematics.  Governments too can play a bigger role, not only like Johnson did in recognizing the problem but by enacting enabling policy measures and delivering public funding to support progress in research and development.

Albert Einstein once said that “The definition of insanity is doing the same thing over and over again and expecting different results”. So it was that I spent the last few days in Doha, perhaps anticipating that something might just be different this time around – after all there were things to be done and a whole new agreement to be crafted by 2015.

Finally late on Saturday, COP18 came to an end. Two weeks of discussion and negotiation had barely moved the needle, so the challenge to bring the conference to a useful conclusion and at least move the agenda forward somewhat fell on the Qatari President of the COP, H.E. Abdullah Bin Hamad Al-Attiyah – which is what he did, despite the objections of some parties. At the end of it all, UNFCCC Christiana Figueres tweeted;

“Read how COP18 has opened a gateway to greater ambition and action on climate change . . . . “

Some may see this as a rather optimistic perspective on a COP that may well be remembered more for the excellent facilities provided by the Government of Qatar, rather than anything tangible that the countries were able to agree to actually reduce emissions. The outcome could be described at best as administrative. The three objectives I discussed at the beginning of the conference were delivered to some extent, although the Durban Platform did not progress as much as might have been expected, given the tight delivery timetable it has.

1. The highlight was the agreement on a second commitment period for the Kyoto Protocol, which will now run through to 2020. Most commentators made much of the fact that the agreement only included Europe and Australia, but this is a rather unfair representation of the conclusion. True, the coverage is not what it was for the 2008-2012 period, but looking at it from the reverse perspective, only Canada, Russia, Japan and New Zealand have dropped out. All of the other former Soviet states have remained, as have Switzerland and Norway. Of course the developing countries have remained, but still without commitments other than to make use of the Clean Development Mechanism. The AAU issues were largely put to rest and at least for the time being the agreement leaves the world with the internal workings of a carbon market, but not much else.
2. The LCA discussion proved to be the most fractious, perhaps because it is home to the financial flows that are now beginning to percolate through the UNFCCC. This shouldn’t be confused with the carbon market financial flows of the Kyoto Protocol and the future New Market Mechanism, but the much anticipated flow of public funds from developed to developing countries. The job of the COP was to bring the LCA to a close, which in turn would make way for a more focussed discussion on the 2015 Durban Platform agreement. But money got in the way. Many parties claimed that the work of the LCA was incomplete, largely because of the fact that the money is hardly flowing and the Green Climate Fund remains uncapitalised. The US argued that this is because the modalities of the fund have not been agreed and complained that where money had been made available, such as through the Fast Start Mechanism, no appreciation was shown on the part of the recipients. In the end, the LCA did close, but mainly through an administrative sleight of hand which relocated most of its activities to various technical groups under the Convention.
3. Finally, there was the ADP (Durban Platform). The delegates spent two weeks discussing this under two work streams, one which is looking at increasing the level of ambition up to 2020 and a second which is looking more holistically at the structure of an overarching framework. At this late stage, increased ambition through to 2020 seems like a rather pointless discussion. The energy mix for the 2020s is rapidly being cast in stone all over the world, to the extent that only relatively minor changes could now be made. This isn’t to say that we should give up, but we should at least recognise that major initiatives starting today will only bear fruit in the 2020s and 2030s, but not before then. Even a modest energy efficiency initiative could still take a decade to fully play out, given the time for political agreement, national ratification and finally implementation. Gripped by the urgency of the issue, the parties managed to agree the meeting schedule for the period between now and 2015, but failed to take matters further. That amounts to a year lost since Durban, with almost nothing to show in terms of progress. Unfortunately, even the world’s glaciers would consider the pace to be slow.

Perhaps there was a gateway opened to ambition and action, but nobody has passed through it, or seem likely to in the near future. The level of ambition also remains far short of a 2 deg.C trajectory. By contrast, the side event programme was full of national delegates, some who had come from the negotiation meetings, talking about their national programmes. Not surprisingly, the Chinese “carbon market” presentations were packed.

Now comes the sting in the tail – “loss and damage”. I suspect that this is a subject that has had the lid kept on it for some time, but it is in the open now, probably because of the claimed dissatisfaction with the level of funding and financing flowing from developed countries. The final version of the text raises the worrying prospect of the development of a mechanism to address the impacts of climate change. The following two clauses are pretty clear on the issue:

8. Requests developed country Parties to provide developing country Parties with finance, technology and capacity-building, in accordance with decision 1/CP.16 and other relevant decisions of the Conference of the Parties;

9. Decides to establish, at its nineteenth session, institutional arrangements, such as an international mechanism, including functions and modalities, elaborated in accordance with the role of the Convention as defined in paragraph 5 above, to address loss and damage associated with the impacts of climate change in developing countries that are particularly vulnerable to the adverse effects of climate change;

Subjects like this have the potential to stall the process for years, although some may argue that the current rate of progress is little better than stalled anyway. It will also get to the issue of apportioning blame, since this is the flip side of “loss of damage”. If there is blame to share, then the only pragmatic way to do it will be on the basis of cumulative emissions, since this is the root cause of the climate issue. Unfortunately nature doesn’t know anything about emissions per $ of GDP, it just sees accumulation. Given current development rates and the size of some national populations, the cumulative national emissions league table is rapidly changing. By 2020, many of the leading nations “to blame” for the state of the climate (at least on the basis of cumulative emissions) will be today’s “developing countries” (some further thoughts on this to follow in a future post).

The parties will convene in Warsaw next year, somewhere in Latin America the year after and possibly in France in 2015 – all that seemed to be agreed without too much fuss. There will be various inter-sessional meetings in the meantime, but if a deal is really going to be agreed by 2015, something remarkable is going to have to happen. We should reflect on the fact that the noisy and messy closure of the LCA was the sad end of a process that started in Bali and was supposed to deliver a global deal. It didn’t. Perhaps Einstein was right.

This week sees the start of the 18th Conference of the Parties of the UNFCCC, or COP18 for short, in Doha, Qatar. This should be a busy transitional COP, with much on the agenda to resolve and important steps forward being taken toward a long term international agreement. But procedural issues, agenda disagreements and fundamental sticking points could still dominate, leading to a two week impasse. Let’s hope not.

At the core of the process lie three work streams which have evolved over many years.

The oldest of these is the discussion on the Kyoto Protocol (KP), which has now been running in one form or another for most of the twenty year history of the UNFCCC. Discussion on a second commitment period (KP2) over the past years have embodied the toughest issues in the climate negotiations, such as the role of developing countries in reducing emissions, engagement with North America (neither Canada or the United States will participate going forward) and the need to put a robust price on CO2 emissions. I am a big fan of KP, despite its shortcomings. It was designed with carbon pricing as its central theme, allowed countries to trade to find lowest cost abatement pathways and through its architecture encouraged signatories to implement cap-and-trade based policy frameworks within their respective economies. The simple but clever ideas within it have not been matched since in terms of effectiveness and efficiency despite years of negotiations. Given sufficient willingness, there are clearly routes forward by which KP could evolve to become the much sought after “21st Century global agreement”, but instead it is reaching the end of its shelf life. There seems to be no resolution with North America under this banner, developing countries appear reluctant to let it be the approach to govern their much needed actions and even the country of its namesake city is unwilling to sign again on the dotted line. Australia and the EU remain as the KP bedrock, if for no other reason than to rescue the CDM and consummate their carbon market linkage with a common approach to accounting, offsets and single market currency (AAUs and CERs). The parties do need to agree on KP2, despite the lack of critical mass, and then roll forward its inherent carbon market architecture into the new grand design.

Next comes the discussion on long term cooperative action, or LCA, a workstream which appeared in 2007 at the Bali COP and is home to a broad range of developments from the Green Climate Fund (GCF), the Nationally Appropriate Mitigation Action (NAMA), the much discussed New Market Mechanism (NMM) and more recently the Framework for Various Approaches (FVA). It was meant to deliver the grand deal at Copenhagen in 2009 but didn’t and now labours on with many loose ends and partially thought through ideas which have not been implemented or even fully negotiated. Nevertheless it has been a useful testing ground for new thinking, but has not yet delivered any real mitigation action. It needs to stop now, but difficult issues remain such as the funding of the Green Climate Fund and the modalities for actually spending any money that may arrive in its coffers. These spinoffs from the LCA will need to continue under one of the Subsidiary Bodies or within the ADP (see below) discussions, but the parent discussion should be put to rest in Doha.

Now comes “the new hope”, the Durban Platform for Enhanced Action. For some, the parties at COP17 simply kicked the can 9 years down the road knowing that little new progress would be made, but for many this represents a much needed and major reboot of the process after years of making almost no progress at all on the respective roles of developed, emerging and developing economies. As Harvard’s Rob Stavins noted in his blog of January 2012;

Now, the COP-17 decision for “Enhanced Action” completely eliminates the Annex I/non-Annex I (or industrialized/developing country) distinction.  It focuses instead on the (admittedly non-binding) pledge to create a system of greenhouse gas reductions including all Parties (that is, all key countries) by 2015 that will come into force (after ratification) by 2020.  Nowhere in the text of the decision will one find phrases such as “Annex I,” “common but differentiated responsibilities,” or “distributional equity,” which have – in recent years – become code words for targets for the richest countries and a blank check for all others.

We should not over-estimate the importance of a “non-binding agreement to reach a future agreement,” but this is a real departure from the past, and marks a significant advance along the treacherous, uphill path of climate negotiations.

Although there have been some opening salvos fired in the ADP (Ad-Hoc Working Group on the Durban Platform for Enhanced Action) in various inter-sessional meetings this year, the heavy lifting for this work stream needs to start at COP18. In recent months the IEA, the World Bank, PWC and others have all made it abundantly clear that unless some truly meaningful progress is made in the sort term, the 2 deg.C goal will pass us by (it may already have) and that before we know it we will be looking at a 4 deg.C outcome, along with all its consequences. Even the timetable for the ADP, which seeks to reach agreement by 2015 for implementation in 2020 is problematic in terms of the need for immediate action, but it is what it is.

The ADP needs to define a work programme that embraces the five primary strands of action coming out of the KP and LCA, namely;

• National action defined through specific targets, goals and actions, but aligned with the overarching mitigation objective. This would also include REDD.
• An underlying carbon market infrastructure as currently embodied by the KP but adapted to the applicable framework for mitigation action. Without an evolving price on carbon in the international energy markets, mitigation action will stall. This work stream should also pick up the NMM discussion.
• A funding mechanism that can leverage private sector finance for kickstarting technologies and helping less developed economies invest in a low carbon pathway forward. This is the GCF.
• A continuation of the work of the TEC and CTCN to share knowledge and best practice arising from technology implementation.
• A robust approach to adaptation.

Recently the World Business Council for Sustainable Development resurfaced work that it undertook back at the start of the LCA, but which is highly relevant to the first of the two prospective work areas above. “Establishing a Global Carbon Market” looks at how the substance of the KP carbon market can be applied much more broadly to an evolving world of various approaches.

The above represents a tall order for two weeks work, but with some 10,000 people in tow there is certainly enough labour at hand to get this heavy lifting done. A refined single track approach will bring much needed focus back to the discussions which then paves the way for at least some hope that the 2015 goal for a new agreement can be met. In summary, the big asks for this COP are:

1. Agreeing a continuation of the Kyoto Protocol through to 2020 and then politely ushering this Grand Dame of the UNFCCC off the stage with some reverence and applause.
2. Bringing closure to the LCA work programme and shifting some key components (e.g. GCF, TEC) into the formulation of the ADP.
3. Establishing a clear work programme for the ADP, which incorporates as a priority, the foundations for a continuing and evolving global carbon market.

Good luck and success to all the delegates.

I have just got back from the annual Council meeting for the World Business Council for Sustainable Development (WBCSD) where it was good to hear the new President, Peter Bakker, talking about a much more focused and serious response from the organisation to key issues such as climate change. During the week real challenge has come from the likes of Paul Gilding and Will Steffen of The Stockholm Resilience Centre. The latter is well known for the development of the Planetary Boundaries framework, which seeks to quantify the limits on a set of critical parameters impacting the stability of the conditions of the Holocene period (which has seen the development of human civilization during a 10,000 year period of relative global stability).

The nine Planetary Boundaries are shown in the figure above and are;

• Stratospheric ozone depletion
• Nitrogen cycle
• Phosphorous cycle
• Global freshwater use
• Change in land use
• Biodiversity loss
• Atmospheric aerosol loading
• Chemical pollution
• Climate change (level of CO2 in the atmosphere)

These have become a useful metric, but Will Steffen admitted that the complexity of the subject has been a challenge. A further challenge to simplify the structure has been posed back to the Stockholm Resilience Centre. They have taken up this challenge and revisited the approach, reducing it to three critical metrics. They are as follows;

• Climate change – rather than just measuring this in terms of CO2 in the atmosphere, the metric is the global heat balance. Because of increasing levels of greenhouse gases in the atmosphere, the atmosphere is no longer in heat balance, rather there is more heat coming in than going out. This situation needs to be brought back into check.
• Biodiversity – this is key to the production of goods and services from the biosphere, including most critically food for human consumption.
• Introduction of novel entities – this is about the introduction of new “stuff” into the environment.  Perhaps one of the best examples of this was the use of Chlorinated Fluoro-carbons (CFC). These offered tremendous economic benefit but with no concept of the damage that would be done to the ozone layer. Will Steffen made an interesting observation about this and noted that we missed a major catastrophe almost by chance. CFCs could well have been BFCs or bromine based. Had this been the case, the more reactive nature of bromine would have devastated the ozone layer by the time the interaction was unravelled, with no chance of recovery. Fortunately this wasn’t the case, but the point was clear.

The nine boundaries work still stands and will continue to be critical to their thinking, with this new model more an “aide memoire” to the bigger picture.

P.S. This is becoming old news now, but in the same session at the WBCSD meeting, a comment was also made about Hurricane Sandy, its impact and climate change. The view expressed was that these are linked for three reasons;

1. This was by far the biggest hurricane ever recorded north of the Carolinas. It was driven by increasingly warmer waters in the Atlantic.
2. It should have tracked out into the Atlantic as many hurricanes have done, but didn’t because of a large blocking high pressure system. There is growing evidence that the appearance of such high pressure systems is linked to the change in ice cover in the Arctic. 2012 saw the lowest September Arctic sea ice cover on record.
3. New York infrastructure was built in a different era. Even the 20cms of additional sea level over the past century made a significant difference to the water volume in the storm surge and the consequent flooding of lower Manhattan and other low lying areas.

C2ES also released a paper on this subject during the week, which you can view here.

I came across an article from the Breakthrough Institute which argues for the benefits of government support for new energy technologies. The story is a few months old, but still highly relevant – in any case a related story is back on their front page this week. The technology in question is hydraulic fracturing (fracking) to extract natural gas from shale formations (shale gas). Breakthrough have come to the conclusion that the boom in shale gas is largely the result of considerable early investment in the technology by the US DOE. The article argues that this technology has transformed the USA energy scene, also resulting in a drop in US CO2  emissions. But the crunch point is the comparison with the EU, where the focus on emissions reduction has been through the development of carbon pricing. Breakthrough argues that the US is shifting rapidly to a lower carbon economy on the back of successful technology push policies, whereas the EU has a failed carbon market which is now even seeing a resurgence in coal use, some of it imported from the USA.

The differing experiences in Europe and the United States illustrate the relative efficacy of direct technology push versus carbon pricing in emissions reduction and advanced technological deployment. As we wrote in a February 2012 article in Yale e360, “the existence of a better and cheaper substitute has made the transition away from coal much more viable economically, and it has put wind at the back of political efforts to oppose new coal plants, close existing ones, and put in place stronger EPA air pollution regulations.”

. . . . .

America’s investments in technological innovation contrast strongly with the European Union’s preference for pricing signals. As Europe follows through on plans to build new coal plants that will burn for decades and America leads recent global decarbonization trends, we continue to find little evidence of success from the ETS or any other major carbon pricing schemes around the world.

There is no doubt that from an emissions perspective, the US is benefitting from the current gas boom. Back in June the IEA reported;

US emissions have now fallen by 430 Mt (7.7%) since 2006, the largest reduction of all countries or regions. This development has arisen from lower oil use in the transport sector (linked to efficiency improvements, higher oil prices and the economic downturn which has cut vehicle miles travelled) and a substantial shift from coal to gas in the power sector.

However, the story that Breakthrough is telling is more about linking events after the fact, rather than analyzing the real policy drivers. According to both Breakthrough and an analysis by Associated Press, DOE funding of fracking goes back decades, as does DOE funding for a range of energy technologies. However, this funding wasn’t linked to emissions reduction, but more to the general need for energy supply diversity, energy security and therefore the cost of energy. I have always argued for technology funding, it is an essential part of the policy landscape, particularly for technologies such as CCS. Canada has been active in this regard, with significant funding for CCS demonstration, such as for the Shell Quest project.

But it wasn’t the technology funding on its own that has delivered the change in the US. Price signals have played a key role, it is just that they are less transparent than the carbon price in the EU. Although there isn’t a carbon price mechanism operating in the USA today (across the whole economy), existing coal fired power stations and almost certainly any new ones being considered are still exposed to carbon pricing. This comes from the expectation of carbon pricing in the future, through regulation under the CAA or a later Congress implementing direct pricing. Shell uses such a price premise in its own projects, including those in the USA. We are on record at $40 per tonne of CO2. There are also more price signals for coal, such as from the new mercury rules.

What has worked in the USA is the combination of funding for new energy technologies and a price signal in the market which then drives deployment. It also happens that the coal fleet is old and even the longevity optimists amongst the power producers are starting to count down the number of years before replacement is due. Eventually, the combination of age, cost of natural gas, expected cost of emissions and likely investment required to keep the coal running delivers the knockout blow.

Turning to Europe, the modest resurgence in coal use comes from a similar set of sums, it’s just that the answer is different. The natural gas prices currently seen in the USA aren’t available, coal is getting cheaper thanks in part to US exports and the carbon price signal can even be locked in at relatively low and known levels by using the market. The result is less than desirable from the atmosphere’s perspective, but it is the reality of the current pricing signals. Back in June, Bloomberg reported;

Europe is burning coal at the fastest pace since 2006, as surging imports from U.S. producers such as Arch Coal Inc. (ACI) helped cut prices 26 percent in a year and benefited European power companies including EON AG. Demand for coal, the dirtiest fuel for making electricity, grew 3.3 percent last year in Europe while sales of less- polluting natural gas fell 2.1 percent, the steepest drop since 2009 . . .

None of this means that the EU approach to managing CO2 emissions is wrong or that price signals don’t do anything. Quite the reverse. It’s just that the answers coming out are currently giving some unexpected outcomes.

The Global Carbon Capture and Storage Institute has just released its 2012 report on the current status of CCS around the world. The headline is that CCS is clearly up and running and CO2 is being sequestered. Around the world, eight large-scale CCS projects are storing about 23 million tonnes of CO2 each year. With a further eight projects currently under construction (including two in the electricity generation sector), that figure will increase to over 36 million tonnes of CO2 a year by 2015. This is approximately 70 per cent of the IEA’s target for mitigation activities by CCS by 2015.

The flip side of this is that the rate of deployment is far below anything that remotely passes for a 2°C trajectory. The report finds that in order to maintain the path to the 2°C target, the number of operational projects must increase to around 130 by 2020, from the 16 currently in operation or under construction. Such an outcome looks very unlikely as only 51 of the 59 remaining projects captured in the Global CCS Institute’s annual project survey plan to be operational by 2020, and inevitably some of these will not proceed.

I have discussed CCS many times in the past. Given the continued abundance of fossil resources, their ease of use for both mobile and stationary energy generation, combined with the fact that they continue to be very cost competitive as new extraction technologies are introduced, it is therefore highly likely that we continue to make use of them. But as the report notes, we need to limit the increase in the stock of CO2 in the atmosphere to 1000 Gt this century (giving a 50 per cent chance of limiting global temperature rise to 2°C) which in turn requires energy-related CO2 emissions to fall to zero by 2075. The only way to square this circle will be large scale deployment of CCS.

One of the surprising aspects of the report is the review of where CCS is actually happening. Conventional wisdom says the EU then North America and that is certainly true for many of the more advanced projects, but close behind is China which has a number of projects in the identification stage of development. In fact the report finds that more than half of all newly-identified projects are located there. Using CO2 for Enhanced Oil Recovery (EOR) is being investigated as a revenue option in all the projects.

• Daqing Carbon Dioxide Capture and Storage Project (Identify stage) – a super-critical coal-fired power plant that would capture around 1 Mtpa of CO2 through oxyfuel combustion, developed by the China Datang Group in partnership with Alstom.
• Dongying Carbon Dioxide Capture and Storage Project (Identify stage) – a new build coal-fired power generation plant with a planned capture capacity of 1 Mtpa of CO2, also developed by the China Datang Group.
• Shanxi International Energy Group CCUS Project (Identify stage) – a new, super-critical coal-fired power plant with oxyfuel combustion being developed in partnership with Air Products, with a capture capacity of more than 2 Mtpa of CO2.
• Jilin Oil Field EOR Project (Phase 2) (Identify stage) – EOR operations at the Jilin oil field, where around 200,000 tpa of CO2 from a natural gas processing plant are currently being injected, are scheduled to be expanded to more than 800,000 tpa from 2015.
• Shen Hua Ningxia Coal to Liquid Plant Project (Identify stage) – a new build coal-to-liquids (CTL) facility developed that would capture around 2 Mtpa of CO2.

Perhaps the most disappointing news comes from Europe, where the value of the main CCS capital support mechanism has been reduced to a fraction of its anticipated amount following the collapse of the EU carbon market to some €8 per tonne of CO2. The EC policy objective of having up to 12 commercial-scale demonstration plants operating in Europe by 2015 is no longer achievable, with 4–5 projects operating in the next 5–6 years being a more realistic scenario. I commented on this back in June.

As well as giving a comprehensive breakdown of all the current projects, the report does the same for policy development, support mechanisms, storage potential and the progress in the technology itself. If you want to know more about CCS then this is truly a “one stop shop”.

The report download page with laptop, iPad and Kindle versions can be found here. Alternatively, you can go directly to the PDF version here.

If you dig down a few layers through the US State Department website, you will come across a Press Release from February 2010 where the USA pledged to reduce its greenhouse gas emissions.

Press Statement

Todd Stern,  Special Envoy for Climate Change Washington, DC

February 4, 2010

Special Envoy Stern: We are pleased to be among 55 countries – including all of the world’s major economies — that have submitted pledges to limit or reduce their greenhouse gas emissions under the Copenhagen Accord. These countries represent nearly 80% of global emissions. In supporting the Accord, we are taking an important step in the global effort to combat climate change.

In addition to the countries that have submitted targets or actions, a number of others have conveyed their support for the Accord. We urge all countries to join this broad coalition by promptly conveying their support for the Accord to the UNFCCC Secretariat.

The Copenhagen Accord includes important advances on funding, technology, forestry, adaptation and transparency. The United States is committed to working with our partners around the world to make the Accord operational and to continue the effort to build a strong, science-based, global regime to combat the profound threat of climate change.

I have commented on the commitment in previous postings, but just to be reminded of what was said, here is a copy of the letter sent by the US to the UNFCCC. 

Last week the US EIA released the latest greenhouse gas emission figures and they show that the country is well on track to meet this pledge, even though there is no formal program in place to ensure delivery. 

Following the sharp recession led drop, two continuing drivers for the change are the drop in coal emissions as older coal fired power plants close and the fall in automotive emissions due to tougher vehicle efficiency standards and the continuing higher oil price. As expected, natural gas emissions have risen as this fuel replaces coal in power generation, but with less than half the carbon footprint of the coal.

This trend could well continue over the coming years as further coal capacity is closed in response to the combination of EPA air quality regulation, expected greenhouse gas regulation and the growing supply of natural gas. In addition, CAFE standards should ensure further improvements in vehicle efficiency.

My original analysis of this trend produced the following chart. Two years on and we still seem to be at least in the same ballpark.

In a speech given at Dartmouth College at the beginning of this month, US Lead Climate Negotiator Todd Stern caused some consternation in the media by opening up the subject of the global two degree Celsius target. Bylines such as “US Abandons 2° Target” appeared soon after, to the extent that a further statement was made two days later by Todd Stern to say;

 “The U.S. continues to support this goal. We have not changed our policy.”

Reading the speech more closely, Stern had not dismissed the target at all nor questioned the necessity of making substantial reductions in global emissions. Rather, he had outlined a negotiating strategy which might bring nations to the table and actually get them to agree on something, rather than the status quo situation which has so far resulted in little progress.

 For many countries, the core assumption about how to address climate change is that you negotiate a treaty with binding emission targets stringent enough to meet a stipulated global goal – namely, holding the increase in global average temperature to less than 2° centigrade above pre-industrial levels – and that treaty in turn drives national action. This is a kind of unified field theory of solving climate change – get the treaty right; the treaty dictates national action; and the problem gets solved. This is entirely logical. It makes perfect sense on paper. The trouble is it ignores the classic lesson that politics – including international politics – is the art of the possible. . . .

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. . . . .

This kind of flexible, evolving legal agreement cannot guarantee that we meet a 2 degree goal, but insisting on a structure that would guarantee such a goal will only lead to deadlock. It is more important to start now with a regime that can get us going in the right direction and that is built in a way maximally conducive to raising ambition, spurring innovation, and building political will.

The 2°C target has been around for a while, but has no particular scientific basis. Rather, it represents an integrated assessment based on many inputs. From what I have been able to find, it appears to be the point at which various systems may see a step change in their response to rising temperatures. This includes the collapse of some major ice shelves, changes in major ocean current circulation, the demise of some marine ecosystems, extensive coral bleaching and so on. Much of this is summarized in an output document from a 2005 conference, Avoiding Dangerous Climate Change, convened by the British Government prior to their hosting of the G8. Although the EU had proposed a 2°C target well before 2005, it was at this conference and the following G8 meeting where it really took hold. Finally, at the UNFCCC COP in Cancun it was agreed as a formal goal, given that the objective of the Convention is to “avoid dangerous anthropogenic interference with the climate system”.

But the 2°C objective is just the beginning  of a long chain which must ultimately stretch down to the allowable emissions of a given power plant or the need to store a tonne of CO2 in a subsurface reservoir. This chain is riddled with uncertainty which almost never gets a mention. For example, many now link the 2°C objective with atmospheric stabilization of CO2 at a level of 450 ppm and in previous postings I have talked about 2°C equating to an atmospheric stock of one trillion tonnes of carbon. But these are levels that are associated with something around a 50% probability that global temperatures will plateau below a 2°C rise. In trillion tonne terms, based on a “business as usual” scenario, we will cross that point in about mid-2043. Shifting the bar such that we have a better than 75% chance of limiting the temperature rise to 2°C moves the crossover point back 15 years, to early 2028.

There is also no guarantee that we can collectively limit the temperature rise to below 2°C. Even if emissions stopped today, the range of possible outcomes from a 400 ppm CO2 level includes 2°C, albeit at quite a low probability. This is because the atmosphere is not in a state of heat equilibrium and will continue to warm at current levels of CO2.  As such, determining a target atmospheric CO2 concentration becomes difficult. 450 ppm is convenient in that it is above current levels, was feasible (at a stretch) when first raised and coincided with a 50% chance of limiting the temperature to 2°C. More recently James Hansen of GISS / NASA has argued for a target of 350 ppm, in that this would restore the current heat imbalance in the system and therefore stop the temperature rising. The problem with this goal is that we have already passed it and nobody really likes setting a target which can’t be met.

Further to the problem of determining a desired plateau for atmospheric CO2, comes the even more difficult task of translating this into a physical limit on global emissions. The task of halving emissions by 2050 is often discussed, but little mention is made of the fact that after 2050 the trajectory must head pretty rapidly to zero. Even the “half by 2050” goal has been obscured by a forgotten baseline year. For some it is 1990, others it is 2000 / 2005 or even just half compared to now. These are all very different. The original baseline when the “half” was first discussed was 1990, which for energy related emissions translates to a goal of 10 GT per annum – China today is at about 8 GT.

As already noted, CO2 acts like a “stock pollutant” in that it collects in the atmosphere. The best approach for this is to find a mechanism for limiting the cumulative CO2 emitted, in other words never emitting that trillionth tonne of carbon.

Framing the problem in this way then perhaps makes us think differently about the comments made by Todd Stern. Trying to carve up the space left in the atmosphere between 190+ nations may be a diplomatic stretch too far, so we should at least move with haste towards what we can do now. In the interim, as actions start to take root and countries realize that limiting emissions isn’t the end of life, the universe and everything, the door then opens to a more comprehensive approach. This would be an “evolving legal agreement” .

Such an approach isn’t the ideal, but given that “immediate global agreement” has very little chance of happening, it would appear to be the prudent way forward, but with the our sights still set on the 2°C goal.

The current spate of very hot weather across much of the USA (and not forgetting the balmy “winter” days in many states back in the early part of the year) raises the question of the role of climate change in relation to such extremes. Of course long term changes in the climate and the occurrence of daily and weekly weather events are very different things, with the latter being the direct result of chaotic movement within the atmosphere. But weather does follow some pattern and over the longer term these patterns can be influenced by a shift in the climate.

A few months back I commented on a paper written by James Hansen which examined this issue in some detail. As illustrated in the figure below, Hansen showed that the distribution of seasonal temperature has indeed shifted, leading to an increase in anomalous events. An important change is the emergence of a category of summertime extremely hot outliers, more than three standard deviations (σ) warmer than the 1951-1980 baseline.  This hot extreme, which covered much less than 1% of Earth’s surface in the base period, now typically covers about 10% of the land area.  He concluded that extreme heat waves, such as that in Texas and Oklahoma in 2011, Moscow in 2010 and now the US heat wave (which has seen thousands of temperature records topple), were “caused” by global warming, because their likelihood was negligible prior to the recent rapid global warming.

Hansen produced an analysis of temperature data which showed this phenomena was indeed happening. Given the current interest in the issue from friends and colleagues in the USA I thought I would try to see what I could establish by doing my own analysis. Long term US temperature data is readily available for download, so I loaded 110  years (1902-2011) of New York Central Park temperature data into Excel and did some number crunching. I looked at the summer period only (June, July and August) and focused on the maximum daytime temperature in °F. I divided the data into two parts, pre 1950 and post 1950. The respective distribution curves are shown in the chart below. 

There is certainly a shift in the distribution curves, although it is quite small. The median temperature in the pre-1950 data is 82, whereas in the post 1950 data it is 83. But even such a small shift changes the probability of a very hot day. The chart below shows that while the probability of an 80°F day has barely shifted, the chance of a 95°F day has risen from 1.8% to 2.3%, or about a quarter. 

Even such a small shift can have a noticeable impact. A chance of 1.8% means that before 1950 there were about 2 summer days with a maximum temperature of 95°F,  but since 1950 there has been an extra day every two years. Another way of looking at this is to examine the incidence of heat waves in New York. In the chart below, I have counted the number of days where that day and the previous three days were 90°F or above. Adding a trend line to the graph shows that over 110 years the number of “heat wave” days has increased from one to over three, or alternatively a single annual four day heat wave in 1900 to at least two per year by 2010 or one lasting more than a week (and there are other combinations as well).

Finally, a more marked change shows up when comparing the period from 1902-1925 with the period 1990-2011. Now the chance of a 95°F day in the summer has about doubled!! The Post 1990 distribution is also starting to show the appearance of very hot days (more than 100°F), which hardly existed prior to 1925.

Energy policy development over the last decade has shown one thing for certain, governments the world over are persistent in their desire to alter the energy mix and/or at least begin to manage emissions. Whether this is purely for environmental reasons or for concerns about energy security or perhaps for long term fiscal security almost doesn’t seem to matter, energy policy development and emissions management continues to be a high priority. This then opens up the question as to how business should best respond to this trend and what role it should play?

Recent developments in Australia present a useful case study. When the CPRS (Carbon Pollution Reduction Scheme – a national cap-and-trade system) was proposed in 2008, an unintended coalition of certain business interests, the Federal Opposition and Green Party opponents eventually managed to see the bill fail. Many businesses actually supported the bill at the time, but seemingly the planets were not suitably aligned for passage. Had things been different, Australia would now have been in the late implementation phase of a relatively benign approach to managing emissions with a carbon price very likely around AU$10 per tonne, trading on the back of the global price for a Certified Emission Reduction (the UNFCCC offset mechanism) and its link to the EU ETS. Instead, events have resulted in a very different outcome. A fixed carbon price of $23 per tonne will be implemented from July, albeit transitioning to a market related price in a few years time. Recent media reports tell of a heated national debate now underway, with many arguing that the price is out of line with the “prevailing global price” and therefore leaving Australia competitively exposed. Not surprisingly, those that first opposed the CPRS and those concerned about the current price are in many cases, one in the same. The first offer in the form of the CPRS was arguably the better deal, yet it was turned down.

At least two offers have been made in the USA. In 2001 the Bush Administration offered a science and technology based approach which has delivered some results, but given a general lack of enthusiasm for implementation by the NGO community in particular with some business groups as unintended allies, the initiative failed in key areas such as the development of carbon capture and storage. Had real progress been made, rollout of the technology might have been underway today. Eight years later the second offer came from the Obama Administration in the form of a national cap-and-trade approach in combination with technology incentives, but this was also declined. Both of these were also relatively benign, the first because it represented an early start and would had been largely government funded and the second because the overall structure of the deal offered significant competitive protection for key industries and included both a long lead time for implementation and a soft start. The Clean Air Act offer now on the table appears to be the least palatable of all these and could well prove to be less effective in terms of actually reducing emissions. Given that it will require specific actions of large emitters, the implied carbon price for some facilities may be very high. In addition, the approach will address individual sources but may not result in a real reduction of national emissions because no overall cap will be in place.

Canada has also followed a fairly tortuous path in recent years. No substantive national programme to manage emissions has emerged, yet various forms of market based policy have been tested and rejected. Although carbon pricing mechanisms now exist in some provinces, a national standards based regulatory approach may well emerge, keeping pace with the Clean Air Act developments now underway in the USA. This is bound to be more complex and almost certainly more costly for business than the cap-and-trade approach that was first proposed back in about 2003. In 2005 a North American cap-and-trade approach was even studied by a combined EPA / Environment Canada Task Force.

 The increasing number of standards based or fixed price approaches that are now “on offer”, bring into question the wisdom of defeating “cap-and-trade”. The latter offers compliance flexibility through offset mechanisms, banking and limited borrowing, competition protection through free allocation in the early phases of implementation and even technology incentives through constructions such as the NER300 in the EU-ETS. By contrast, a standard has limited flexibility, no price transparency and potentially onerous penalties. This would appear to represent something of an “own goal”.

The EU faces a related issue today. Despite some initial grumbling, businesses in Europe actually accepted the first offer of the EU ETS (cap and trade). But its effectiveness has slowly eroded over time. This is partly due to the recession but there is also a policy design cause arising from the superimposition of multiple layers of policy, such as specific renewable energy targets, nuclear build rates, efficiency mandates and more. These policies are well meaning but often misaligned. As the ETS has weakened, this process has accelerated therefore compounding the problem. The business community is split over what to do about this with various proposals involving the set aside of allowances favoured by some, but others arguing that the system is naturally responding to events and should be left to find its own way. The problem with the latter position is that it could result in an ETS that becomes politically and economically irrelevant, leaving a standards based approach as the way forward in Europe as well. Another “own goal” in the making!