Binding Emission Targets Research Articles

Economic, environmental, and technical gains from the Kyoto Protocol: Evidence from cement manufacturing

The Kyoto Protocol is an international agreement signed in 1997 to reduce emissions of carbon dioxide and mitigate the consequences of global climate change. Early studies of the effectiveness of the Kyoto Protocol have attributed it to approximately a 7%–10% reduction in global carbon dioxide emissions. Given the carbon intensity of cement manufacturing, we examine the impact of the Kyoto Protocol on cement manufacturing output and carbon dioxide emissions. We are especially concerned about whether the Kyoto Protocol may have led cement manufacturing to move to places without binding emissions targets, thus resulting in carbon leakage. We find that nations with binding emissions targets under the Kyoto Protocol saw a 5% reduction in both cement manufacturing and carbon dioxide emissions from cement manufacturing compared to other nations, suggesting that the Kyoto Protocol may have led to technological innovation in cement manufacturing. Using data on carbon intensities for cement manufacturing, we support this notion and find further evidence that it fostered diffusion of existing, cleaner technologies from relatively more developed nations during the first phase, and technical innovation by these nations during the second phase, resulting in significant reductions in carbon dioxide emissions.

Climate policy boosts trade competitiveness: Evidence from timber trade networks

Climate policy affects the economy. Economists typically consider the economic costs associated with climate policy, but not all economic consequences of climate policy are necessarily negative. This paper considers the impact of the Kyoto Protocol on the international trade network for timber products and the competition graph derived therefrom. Implementing an instrumental variables difference-in-differences approach which uses a panel of centrality and clustering measures describing the relative importance of individual nations in the international trade network for timber products, this paper finds that nations that set a binding emissions target under the Kyoto Protocol saw the centrality of their position within this network decrease. Since the nations which set binding emissions targets were also the wealthiest nations, an additional consequence is that less wealthy economies became relative more important members of this international trade network. This is likely due to nations with a binding emissions target placing an increased importance on forested land for carbon sequestration. These results are extended to the competition graph of the international trade network for timber products where it is found that nations with binding emissions targets became marginally less important. However, increased clustering among nations with binding emissions targets in the competition graph occurred as a consequence of the Kyoto Protocol. Collectively, these results indicate that the competitive playing field was leveled in the international timber trade network while helping make progress towards multiple economically and environmentally oriented United Nations Sustainable Development Goals.

Who delays climate action? Interest groups and coalitions in state legislative struggles in the United States

Gridlock and rollback in Washington have led to a turn to the states for action on climate change in the U.S. The state of Massachusetts presents a particularly puzzling case, since it was an early leader with binding emissions targets, but the succeeding dozen years saw most ambitious efforts stalled or watered down. We collected 1187 pieces of legislative testimony, 4126 reported lobbying visits, and interviews with and input from over fifty experts. Based on their lobbying reports and testimony in legislative hearings, we systematically characterize the legislative interests of nine main coalitions engaged in Massachusetts energy politics. We find that climate and clean energy advocates have few reliable allies and face four coalitions of opponents from the utilities, real estate, power generators, and fossil fuel and chemical industries. Our analysis indicates the central role utilities play in blocking the most ambitious clean energy legislation, and how they remodel those bills that survive the process into forms favorable to their interests.

A Patchwork of Climate Policies that Reflect Subnational Jurisdiction

The United Nations introduced the Paris Agreement in 2015 aimed at reducing emissions globally. Signatories to the Agreement are responsible for amending their domestic climate policies and implementing binding emission targets. Federations confront several challenges when adopting such policies since jurisdiction is shared between orders of government. This paper explores why Canadian and American federal governance structures constrain the implementation of national climate policies following the Paris Agreement. Despite both countries having ratified the Agreement, climate action in Canada and the US is enacted in a patchwork fashion that reflects subnational jurisdiction. The paper begins by assessing the Paris Agreement and the challenges federations confront when adopting climate legislation. The following section examines the Canadian and American federations separately to identify the factors that inhibit a coordinated response to reducing national emissions post-2015. The paper concludes by exploring strategies to advance climate action on a subnational basis.

The risk of carbon leakage in global climate agreements

Although climate change and international trade are interdependent, policy-makers often address the two topics separately. This may inhibit progress at the intersection of climate change and trade and could present a serious constraint for global climate action. One key risk is carbon leakage through emission outsourcing, i.e. reductions in emissions in countries with rigorous climate policies being offset by increased emissions in countries with less stringent policies. We first analyze the Paris Agreement’s nationally determined contributions (NDC) and investigate how carbon leakage is addressed. We find that the risk of carbon leakage is insufficiently accounted for in these documents. Then, we apply a novel quantitative approach (Jiborn et al., 2018; Baumert et al., 2019) to analyze trends in carbon outsourcing related to a previous international climate regime—the Kyoto Protocol—in order to assess whether reported emission reductions were offset by carbon outsourcing in the past. Our results for 2000–2014 show a more nuanced picture of carbon leakage during the Kyoto Protocol than previous studies have reported. Carbon outsourcing from developed to developing countries was dominated by the USA outsourcing to China, while the evidence for other developed countries was mixed. Against conventional wisdom, we find that, in general, countries that stayed committed to their Kyoto Protocol emission targets were either only minor carbon outsourcers or actually even insourcers—although the trend was slightly negative—indicating that binding emissions targets do not necessarily lead to carbon outsourcing. We argue that multiple carbon monitoring approaches are needed to reduce the risk of carbon leakage.

Filling in for Governments? The Role of the Private Actors in the International Climate Regime

The 2015 Paris Agreement on climate change abandons the Kyoto Protocol’s paradigm of binding emissions targets and relies instead on countries’ voluntary contributions. However, the Paris Agreement encourages not only governments but also sub-national governments, corporations and civil society to contribute to reaching ambitious climate goals. In a transition from the regulated architecture of the Kyoto Protocol to the open system of the Paris Agreement, the Agreement seeks to integrate non-state actors into the treaty-based climate regime. In 2014 the secretariat of the United Nations Framework Convention on Climate Change Peru and France created the Non-State Actor Zone for Climate Action (and launched the Global Climate Action portal). In December 2019, this portal recorded more than twenty thousand climate-commitments of private and public non-state entities, making the non-state venues of international climate meetings decisively more exciting than the formal negotiation space. This level engagement and governments’ response to it raises a flurry of questions in relation to the evolving nature of the climate regime and climate change governance, including the role of private actors as standard setters and the lack of accountability mechanisms for non-state actions. This paper takes these developments as occasion to discuss the changing role of private actors in the climate regime.

ENGO Impacts on Climate Change Policy in European Malta

This article analyzes the impacts of ENGOs with respect to Maltese climate change policy in an EU context. In particular, focus is made on the politics of climate change in Malta and the EU in the first five years following the country's EU accession, which led to the setting of energy emissions targets by 2020. The main conclusion of this article is that ENGOs formed part of an EU-wide hegemonic formation on climate change, wherein a common position with binding emissions targets was reached. The common position was signified around the discourse of ecological modernization. EU multi-level governance provided an opportunity for ENGOs to put forward discourses for climate-change adaptation.

Analyzing the effectiveness of international environmental policies: The case of the Kyoto Protocol

We study the effectiveness of emission targets under the Kyoto Protocol with respect to reducing CO2 emissions. Using country-level and US state-level panel data and employing the synthetic control method, we find very little evidence for an emission reduction effect for the major emitters among the Annex B countries with binding emission targets. More generally, we also show that evaluating the effectiveness of international environmental policies at the country level comes with a number of empirical challenges that may invalidate findings based on more traditional panel data approaches.

Carbon Trading – A Profitable CSR Initiative for Reducing Economic Asymmetries among Nations

Another international climate change summit, this time in the Qatari city of Doha, has concluded without a binding agreement reached on reducing global greenhouse gas emissions. The failure of 18th Conference of the Parties (COP18) was anticipated beforehand by everyone involved, and met with widespread indifference on the part of international media. Since, the debacle at Copenhagen summit in December 2009—which broke up without agreement on a post-Kyoto climate treaty amid bitter conflicts between the major powers — annual UN-sponsored climate summits have been restricted to negotiating various secondary issues, unrelated to the question of binding emissions targets. Heads of government have not gathered to discuss the issue in past three years, leaving junior ministers and diplomats to head negotiating teams at the subsequent summits at Cancun, Durban, and Doha. The inability of world leaders to even meet to discuss the climate change crisis, represents a devastating indictment of capitalist system. Overwhelming scientific evidence points to the serious threat posed to world's population by excessive emissions of carbon dioxide and other greenhouse gases. The forecasts made in first UN Intergovernmental Panel on Climate Change (IPCC) Report, in 1990, have proven accurate. “We've sat back and watched the two decades unfold and warming has progressed at a rate consistent with those projections,” Matt England, of the University of New South Wales' Climate Change Research Centre, told Australia's ABC Radio. “The analysis is very clear that, IPCC projections are coming true. And at the moment, we are tracking at high end in terms of our emissions, and so all of the projections that we look to at the moment are those high end forecasts.” However, the researchers believe that the conclusions will have a broader implication, that will surely help developing nations in not only reaching, the much sought economic integration among them and reducing Economic Asymmetries with developed nations, but also in reducing the emission levels to save our planet. So, if a revolution has to be there in International trade and globalization, be it the Green Way!

An alternative to a global climate deal may be unfolding before our eyes

The core objectives of the United Nations Framework Convention on Climate Change (UNFCCC) are to stabilize greenhouse gas concentrations to non-dangerous levels quickly enough to allow ecosystems to adapt naturally, while not threatening food production or sustainable economic development. The approach embedded in the Kyoto Protocol, reflecting the concept of common but differentiated responsibilities, has been to start by setting binding emissions targets for industrialized countries, while using carbon markets to mobilize international finance for mitigation efforts in developing countries. The critical challenges for negotiators since then, however, have been in agreeing when the time is right to move towards binding emissions targets for developing countries and what level of financial assistance from developed countries is appropriate and politically feasible, given the well-founded perception that such targets, if sufficiently stringent to limit climate change and unaccompanied by strong financial assistance, could in fact hinder many countries. immediate economic development.

Critical mid-term uncertainties in long-term decarbonisation pathways

Over the next decade, large energy investments are required in the UK to meet growing energy service demands and legally binding emission targets under a pioneering policy agenda. These are necessary despite deep mid-term (2025–2030) uncertainties over which national policy makers have little control. We investigate the effect of two critical mid-term uncertainties on optimal near-term investment decisions using a two-stage stochastic energy system model.The results show that where future fossil fuel prices are uncertain: (i) the near term hedging strategy to 2030 differs from any one deterministic fuel price scenario and is structurally dissimilar to a simple ‘average’ of the deterministic scenarios, and (ii) multiple recourse strategies from 2030 are perturbed by path dependencies caused by hedging investments. Evaluating the uncertainty under a decarbonisation agenda shows that fossil fuel price uncertainty is very expensive at around £20 billion. The addition of novel mitigation options reduces the value of fossil fuel price uncertainty to £11 billion. Uncertain biomass import availability shows a much lower value of uncertainty at £300 million.This paper reveals the complex relationship between the flexibility of the energy system and mitigating the costs of uncertainty due to the path-dependencies caused by the long-life times of both infrastructures and generation technologies.

The Effect of Kyoto Emission Targets on Domestic CO2 Emissions: A Synthetic Control Approach

We use recent developments in the empirics of comparative case studies to analyze the effect of binding emission targets under the Kyoto Protocol on the development of CO2 emissions of seven major Annex B countries. In particular, we investigate whether committing to a specific greenhouse gas emissions target had an effect on actual CO2 emissions of Australia, Canada, France, Germany, Great Britain, Italy and Japan by using a synthetic control approach. With the exception of Great Britain, we are not able to reject the hypothesis that there has been no effect of binding emission targets on actual emissions.

The Cause of the War over Caps and How to End It

Industrialized countries are demanding that developing countries accept binding emission targets, but developing countries refuse these caps. Developing countries, in turn demand that Industrialized countries accept much tighter caps than any have considered. Industrialized countries refuse such caps.Developing countries sell carbon offset credits at a profit, but that profit would be reduced if they accepted any cap on emissions. This increases their resistance to accepting such caps. But stricter caps on industrialized countries would cause those countries to buy more offsets from developing countries. The increased profits from increased offset sales is one reason developing countries demand such strict caps.If industrialize countries accepted extremely strict caps and met them by buying enough offsets from developing countries, this could limit emissions enough to meet a reasonable global target. But the high cost to industrialized countries makes this approach politically infeasible. If however, developed countries are allowed to commit to a binding carbon-price target instead of an emission target, this would eliminate their major objections—it would not cap them below developing countries, and it would not prevent them from reaching the same level of development. Industrialized countries could then commit to caps that were guaranteed to be equally effective.

A framework for a post-2012 global climate agreement

Global greenhouse gas emissions are on a steeper growth trajectory than assumed in most scenarios that underlie current international policy discussions and negotiations. Effective global climate change mitigation action will require speed, depth and breadth well beyond any efforts seen to date, and will need to involve all major emitters, including developing countries (Garnaut et al., 2008). To achieve a comprehensive global agreement at or after the Copenhagen climate conference, a principles-based framework for mitigation is needed. Here we outline a system that adds up to a global solution, and that could be broadly acceptable. It involves internationally tradable emissions rights allocated across countries, with allocations moving over time to equal per capita allocations. Developing countries would receive increasing emissions entitlements, linked to their GDP growth, for a transitional period. Binding emissions targets would apply to all developed and high-income countries plus China from the outset.

Regional and Sub-Global Climate Blocs. A Game-Theoretic Perspective on Bottom-up Climate Regimes

No international regime on climate change is going to be fully effective in controlling GHG emissions without the involvement of countries such as China, India, the United States, Australia, and possibly other developing countries. This highlights an unambiguous weakness of the Kyoto Protocol, where the aforementioned countries either have no binding emission targets or have decided not to comply with their targets. Therefore, when discussing possible post-Kyoto scenarios, it is crucial to prioritize participation incentives for all countries, especially those without explicit or with insufficient abatement targets. This paper offers a bottom-up game-theoretic perspective on participation incentives. Rather than focusing on issue linkage, transfers or burden sharing as tools to enhance the incentives to participate in a climate agreement, this paper aims at exploring whether a different policy approach could lead more countries to adopt effective climate control policies. This policy approach is explicitly bottom-up, namely it gives each country the freedom to sign agreements and deals, bilaterally or multilaterally, with other countries, without being constrained by any global protocol or convention. This study provides a game-theoretic assessment of this policy approach and then evaluates empirically the possible endogenous emergence of single or multiple climate coalitions. Welfare and technological consequences of different multiple bloc climate regimes will be assessed and their overall environmental effectiveness will be discussed.

Climate Change Mitigation in Turkey

One of the most contentious issues in the debate over global climate change is the perceived divide between interests and obligations of developed and developing countries. Equity demands that developed countries act first to reduce emissions. That principle is embedded in the 1992 United Nations Framework Convention on Climate Change and in the 1997 Kyoto Protocol, which sets binding emission targets for developed countries only. With the Protocol now likely to enter into force, the focus will turn increasingly to the question of developing country emissions. Turkey's high rate of energy-related carbon emissions growth is expected to accelerate, with emissions climbing from 60 million tons in 2002 to almost 220 million tons in 2020. Carbon intensity in Turkey is higher than the western developed country average. Energy-intensive, inefficient industries remain under government control with soft budget constraints, contributing to undisciplined energy use. Planned industrial privatizations may close the oldest and most inefficient operations and modernize surviving ones. Elimination of energy price subsidies could stimulate energy conservation, reducing energy and emissions growth below current projections. This article reviews energy consumption and climate change mitigation in Turkey.

The Impact of Equity-Preferences on the Stability of Heterogeneous International Agreements

This paper studies the impact of equity considerations on the stability of international agreements between heterogeneous countries. We show that allowing countries to finance abatement projects in developing countries which, due to equity-reasons, have no binding emission targets can reduce the number of cooperating countries and thereby be welfare-decreasing. Equity-concerns in industrialized countries regarding the gap between per-capita emission levels of industrialized and developing countries lead to an increased reduction in industrialized countries but do not qualitatively change the incentives to cooperate. Only if countries are inequality-averse with respect to potential differences between their abatement targets and those of other industrialized countries is the inclusion of developing countries generally profitable both in terms of participation rates and of emission reduction.

The Kyoto Protocol: A Review and Perspectives

International concern about climate change has led to the Kyoto Protocol, negotiated in 1997, which contains legally binding emission targets for industrialized countries to be achieved during the commitment period 2008–12. While proponents of the Protocol celebrate it as a breakthrough in international climate policy, opponents say that its approach, namely setting targets and timetables for emission reductions, is seriously flawed. This paper provides a critical assessment of the Protocol's potential performance and discusses amendments to foster its effectiveness and efficiency. It concludes that, even without any effective emission reductions in the initial commitment period, the ratification of Kyoto is important for the further policy process of climate protection. The Kyoto Protocol has established a flexible, broad-based, international mechanism that provides a valuable starting point for shaping efficient climate policies in the future.

What do we know about carbon taxes? An inquiry into their impacts on competitiveness and distribution of income

The Kyoto Protocol to the United Nations Framework Convention on Climate Change (UNFCCC) has set legally binding emissions targets for a basket of six greenhouse gases and timetables for industrialised countries. It has also incorporated three international flexibility mechanisms. However, the Articles defining the flexibility mechanisms carry wording that their use must be supplemental to domestic actions. This has led to the open debates on interpretations of these supplementarity provisions. Such debates ended at the resumed sixth Conference of the Parties (COP) to the UNFCCC, held in Bonn, July 2001, and at the subsequent COP-7 in Marrakesh, November 2001. The final wording in the Bonn Agreement, reaffirmed in the Marrakesh Accords, at least indicates that domestic policies will have an important role to play in meeting Annex B countries’ emissions commitments. Carbon taxes have long been advocated because of their cost effectiveness in achieving a given emissions reduction. In this paper, the main economic impacts of carbon taxes are assessed. Based on a review of empirical studies on existing carbon/energy taxes, it is concluded that competitive losses and distributive impacts are generally not significant and definitely less than often perceived. However, given the ultimate objective of the Framework Convention, future carbon taxes could have higher rates than those already imposed and thus the resulting economic impacts could be more acute. In this context, it has been shown that how to use the generated fiscal revenues will be of fundamental importance in determining the final economic impacts of carbon taxes. Finally, we briefly discuss carbon taxes in combination with other domestic and international instruments.

What Do We Know About Carbon Taxes? An Inquiry into Their Impacts on Competitiveness and Distribution of Income

The Kyoto Protocol to the United Nations Framework Convention on Climate Change (UNFCCC) has set legally binding emissions targets for a basket of six greenhouse gases and timetables for industrialised countries. It has also incorporated three international flexibility mechanisms. However, the Articles defining the flexibility mechanisms carry wording that their use must be supplemental to domestic actions. This has led to the open debates on interpretations of these supplementarity provisions. Such debates ended at the resumed sixth Conference of the Parties (COP) to the UNFCCC, held in Bonn, July 2001, and at the subsequent COP-7 in Marrakesh, November 2001. The final wording in the Bonn Agreement, reaffirmed in the Marrakesh Accords, at least indicates that domestic policies will have an important role to play in meeting Annex B countries' emissions commitments. Carbon taxes have long been advocated because of their cost-effectiveness in achieving a given emissions reduction. In this paper, the main economic impacts of carbon taxes are assessed. Based on a review of empirical studies on existing carbon/energy taxes, it is concluded that competitive losses and distributive impacts are generally not significant and definitely less than often perceived. However, given the ultimate objective of the Framework Convention, future carbon taxes could have higher rates than those already imposed and thus the resulting economic impacts could be more acute. In this context, it has been shown that how to use the generated fiscal revenues will be of fundamental importance in determining the final economic impacts of carbon taxes. Finally, we briefly discuss carbon taxes in combination with other domestic and international instruments.