Transcript The Regional Greeenhouse Gas Initiative: The National Setting

The Regional Greenhouse Gas Initiative:
The International and National Backdrop
January 26, 2006
Edna Sussman
Program Sponsored by the Renewable Energy Resources
Committee and the Sustainable Development, Ecosystems and
Climate Change
Committee of the SEER Section, American Bar Association
U.S. carbon emissions
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5% of world population
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24% of world carbon
emissions
UNFCC, Kyoto Protocol, Montreal
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United Nations Framework Convention on Climate Change 1992- U.S. a party –
goal to stabilize greenhouse gas emissions at a level that would prevent
interference with the world’s climate system
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Kyoto Protocol- 1997 - US a signatory but has not ratified
– Established firm schedule for CO2 reductions by industrialized countries –
from 2008-2012 those parties will reduce their green house gas emissions
by an average of 5.2 percent as against a 1990 base line. Specific targets
were set for each of those countries. Developing countries not committed.
– Market mechanisms allowed- targets can be met through (i) emission
rights trading, (ii) clean development mechanisms (CDM- sustainable
development emission reduction projects in developing countries), and (iii)
Joint Implementation ( JI - “additional” emission reduction projects in
countries committed to reducing emissions under the protocol, primarily
applicable to Central and Eastern European transition economies
Montreal, December 2005 - Agreement by parties to the Kyoto Protocol to
begin discussions on setting binding limits for post 2012
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European Union Emissions Trading
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European Union Emissions Trading - 2003 – established greenhouse
gas allowance trading scheme EU-wide commencing January 2005 "allowance" means the entitlement to emit a tonne of carbon dioxide or
an amount of any other greenhouse gas with an equivalent global
warming potential during a specified period.
Each country given an allowance allocation and draws up a national
plan allocating allowances to each installation
Covers activities in various industrial sectors including energy, iron and
steel production and processing, the mineral industry and the wood
pulp, paper and card industry
Penalties provided for noncompliance by industry and requires
continuing obligation to deliver compliance
In addition to allowance trading, market mechanisms recognize credits
given for certain types of CDM and JI projects that qualify under the
Kyoto Protocol
U.S. Approach: Asia- Pacific
Partnership
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Asia- Pacific Partnership on Clean Development and ClimateAustralia, China, India, Japan, Korea, and the United States
who together account for 50% of greenhouse gas emissions
Vision Statement – July 2005 – work together to create a
partnership on a wide range of initiatives to deploy promising
technologies that offer greater energy efficiency and lower air
pollution and greenhouse gas intensities.
Charter - January 2006 - non- legally binding partnership to
share technology and practices
Work plan – January 2006 - focus on power generation and key
industry sectors; established 8 public/private task forces to
detail action plans, projects and indicators of progress
http://www.state.gov/g/oes/climate/c16054.htm
US Approach: Calls for Private
Voluntary Action
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President in February 2002 called for voluntary action to cut greenhouse gas
intensity – the amount emitted per unit of economic activity- by 18% by 2012.
Some of the programs instituted to support that initiative include:
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Climate Vision - Presidential public-private partnership initiative launched by the
Department of Energy in February 2003 - focus of the initiative is on energyintensive industries to reduce emissions intensity
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Climate Leaders - voluntary EPA industry-government partnership that works
with companies to develop long-term comprehensive climate change strategies;
Partners set a corporate-wide greenhouse gas (GHG) reduction goal and
inventory their emissions to measure progress.
Chicago Climate Exchange
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The Chicago Climate Exchange® is a voluntary binding greenhouse
gas emission reduction and trading pilot program for emission sources
and offset projects.
Tradable Carbon Financial Instruments are Exchange Allowances
(XA's) and Exchange Offsets (XO's). Exchange Allowances are issued
to Members in accordance with each Member's Emission Baseline and
Emission Reduction Schedule. They are also issued on the basis of
forest carbon sequestration and reductions in electricity use. Exchange
Offsets are generated by qualifying mitigation projects.
Members made a voluntary, legally binding commitment to reduce their
emissions of greenhouse gases by four percent below the average of
their 1998-2001 baseline by 2006, the last year of the pilot program
http://www.chicagoclimatex.com/
Projected U.S. Emissions
Carbon dioxide emissions in the U.S. rose by
2% in 2004 over 2003 levels and an increase
is predicted over 1990 levels of 28% by 2010
and of over 50% by 2025.
Source: Energy Information Administration of
the U.S. Department of Energy, December
2005
ftp://ftp.eia.doe.gov/pub/oiaf/1605/cdrom/pdf/gg
rpt/057304.pdf
EPAct on Climate Change
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Many provisions of the Energy Policy Act of 2005 (“EPAct”)
may indirectly affect CO2 emissions. For an overview of the act
see
http://www.abanet.org/environ/committees/renewableenergy/tel
econarchives/101905/
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Specific provisions on climate change in EPAct :
- Establishment of a Committee on Climate Change to develop
a national strategy.
- Support for demonstration projects
- Report identifying the 25 largest GHG emitting developing
countries and provide assistance.
Climate Stewardship Act
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McCain-Lieberman Climate Stewardship Act introduced in 2003. Reintroduced in 2005.
Patterned after the successful U.S SOx acid rain cap & trade system
-Comprehensive market based system requiring submission of allowances for every metric
ton of green house gas emission commencing in 2010. Goal to cap emissions in 2010 to
2000 levels
- Includes 6 greenhouse gases and electricity, transportation, industry and commercial
sectors that emit from any single facility over 10,000 metric tons of greenhouse gas per
year
- Market system recognizes allowance trading and international credits and allowances
- Allowances for early participation
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Bingaman proposal- 2005
- Based on recommendations of the National Commission on Energy Policy
- Ties emission reduction targets to economic growth
- Provides for pollution credit trading
- Establishes a cost cap for emission “permits”
The U.S. Senate Today
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Following rejection of a plan for carbon emission reduction
credits, a non- binding “sense of the Senate” resolution was
passed 53-44 on June 22, 2005 stating that there was a
growing consensus that human activity is a “substantial cause”
of the accumulation of GHG and “mandatory steps” to slow or
stop growth are “required.”
Senate hearings have commenced on mandatory climate
change legislation.
Senator Bingaman stated in a speech delivered in Montreal at
the United Nations Climate Change Conference in December
that he “believe(s) that we can enact a mandatory program to
control greenhouse gas emissions within the next year or two.”
RGGI and Local Actions
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Pressures for action
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Climate change/international carbon cap regimes
Achieving energy independence and assuring adequate energy
supply
Air quality benefits with significant health impacts
RGGI
California
Western Governors Association
Massachusetts
New Mexico
U.S. Mayors Climate Protection Agreement
Renewable Portfolio Standards in over 20 states
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EDNA SUSSMAN
Hoguet Newman & Regal LLP
10 East 40th Street,
New York, NY 10016
Tel 212-689-8808
Fax 212-689-5101
Email:
[email protected]