A Question of Value: On the Legality of Using Kyoto Protocol Units under the Paris Agreement

David Rossati

doi:10.1163/18786561-11030005

Abstract

Abstract The first commitment period of the Kyoto Protocol generated about 4.3 billion Assigned Amount Units (aaus) and about 180 million Certified Emission Reductions (cers) for carry-over by Annex i states and potential use as ‘overachievements’ or offsets to discount emissions under ndcs. The second commitment period may generate additional carry-over units, and there is an estimated ‘dormant’ amount of about 4.6 billion cers that could be issued from ongoing cdm projects. To rely on these units risks upsetting the process of trust-building necessary to increase ambition under the Paris Agreement. This article questions the legality of carry-overs but finds that a textual interpretation of the current legal framework under both treaties leaves the matter unresolved. With a more refined legal interpretation, based on the principles of environmental integrity and sound accounting under the Paris Agreement, the article re-evaluates aaus and cers under the Agreement, by relying on insights from a social theory of value and the critical studies literature on the political economy of carbon markets. The conclusion is that aaus cannot be used under the ndc accounting framework, as their formal value of 1 Mt CO2 eq. under the Kyoto Protocol is considerably diminished under the Agreement. As for cers, their value depends on different social realities related to their issuance. States or the cma should adopt transparent criteria to select the cers that are worth transitioning pursuant to the Article 6.4 mechanism. The same conceptual framework of value-attribution can also inform the design and operation of the Article 6 mechanisms and their units in order to attain higher environmental integrity and sound accounting for ndcs.

Highlights

After almost eight years of hanging in limbo, in October 2020 the Doha Amendment to the Kyoto Protocol entered into force, right at the end date of the second commitment period (2013–2020) it was meant to govern.[1]
The fact that this treaty has relied on emission-accounting units (‘units’ or ‘Kyoto Protocol units’)[2] for the functioning of its market-based mechanisms and for ensuring state compliance opens up a space for a continued relevance of these units
Rossati yield additional cers up to 2020 if project participants decide to request their issuance, for example because favourable market conditions emerge.[18]. These potential carry-over units might be used under the Paris Agreement as a means of accounting for the achievement of ndcs or as fungible equivalents to Internationally Transferred Mitigation Outcomes and the units of the Article 6.4 mechanism. Such use would risk upsetting the delicate process of trust-building toward higher mitigation ambition under the Paris Agreement,[19] since claimed overachievements via aaus or a reliance on cers might be regarded by other states and the broader public as an attempt to water down the ambition of ndcs

Summary

Introduction

After almost eight years of hanging in limbo, in October 2020 the Doha Amendment to the Kyoto Protocol entered into force, right at the end date of the second commitment period (2013–2020) it was meant to govern.[1]. Rossati yield additional cers up to 2020 if project participants decide to request their issuance, for example because favourable market conditions emerge.[18] These potential carry-over units might be used under the Paris Agreement as a means of accounting for the achievement of ndcs or as fungible equivalents to Internationally Transferred Mitigation Outcomes (itmos) and the units of the Article 6.4 mechanism. Such use would risk upsetting the delicate process of trust-building toward higher mitigation ambition under the Paris Agreement,[19] since claimed overachievements via aaus or a reliance on cers might be regarded by other states and the broader public as an attempt to water down the ambition of ndcs. If this advice is not heeded, the ‘normative expectations of progression and highest possible ambition’ under the Paris Agreement will be violated[21] and state practices lacking due diligence in making use of Kyoto Protocol units may be indicative of bad faith in achieving crucial expectations of ambition under the Paris Agreement

Paris Agreement

Challenging the Formal Value of aaus and cers

Toward a Conservative Use of Kyoto Protocol Units under the Paris

Findings

Conclusion