Emission Entitlements Research Articles

Individual Duties Regarding Global Environmental Problems The Example of Climate Change

There now is a broad theoretical discourse regarding individual duties in which arguments for different kinds of duties as well as actions have been developed. The present paper aims at systematizing this discussion and offers an independent argument that there are duties beyond compliance with and promotion of institutions. The paper starts with some clarifications regarding duties to promote. Subsequently, the main section of the paper addresses the question whether individuals ought to reduce GHG emissions in their responsibility even if these do not contribute to promoting institutions via their communicative value. We first critically discuss objections against such a duty. In a second step, we justify the duty by further developing our so called fair share argument. Subsequently, we clarify the substance of these ‘fair share duties’ and show how they relate to duties to promote. In conclusion, we argue that there are three kinds of complementary, equally important duties: duties to comply with institutions, duties to promote institutions and individual behavioral duties not to exceed one’s fair share of emissions entitlements. The final section locates this tripartite distinction of duties in a framework of different levels of non-ideality.

Moderate Emissions Grandfathering

Emissions grandfathering holds that a history of emissions strengthens an agent's claim for future emission entitlements. Though grandfathering appears to have been influential in actual emission control frameworks, it is rarely taken seriously by philosophers. This article presents an argument for thinking this an oversight. The core of the argument is that members of countries with higher historical emissions are typically burdened with higher costs when tran-sitioning to a given lower level of emissions. According to several appealing views in political philosophy (utilitarianism, egalitarianism, prioritarianism and sufficientarianism) they are therefore entitled to greater resources, including emission entitlements, than those in similar positions but with lower emissions. This grandfathering may play an especially important role in allocating emission entitlements among rich countries.

What is grandfathering?

Emissions grandfathering maintains that prior emissions increase future emission entitlements. The view forms a large part of actual emission control frameworks, but is routinely dismissed by political theorists and applied philosophers as evidently unjust. A sympathetic theoretical reconsideration of grandfathering suggests that the most plausible version is moderate, allowing that other considerations should influence emission entitlements, and be justified on instrumental grounds. The most promising instrumental justification defends moderate grandfathering on the basis that one extra unit of emission entitlements from a baseline of zero emissions increases welfare to a greater extent where it is assigned to a high emitter than where it is assigned to a low emitter. Moderate grandfathering can be combined with basic needs and ability to pay considerations to provide an attractive approach to allocating emission entitlements.

Defining Emissions Entitlements in the Constitution of the EU Emissions Trading System

AbstractThe European Union Emissions Trading System (EU ETS) is the largest mandatory programme of its kind. The entitlements in emissions allowances (emissions entitlements) combine public and private law characteristics: allowances are tradable, commercially valuable regulatory instruments. This dual nature reveals a new interdependency between public and private law mechanisms in the context of climate change policy. This article argues that achieving the requisite level of emissions reductions is contingent on the viability of the emissions market, and that both are dependent on the definition of emissions entitlements. This view is supported by a case study which identifies the practical and serious consequences of the absence of a legal concept of emissions entitlements. The United States (US) Acid Rain Program offers useful lessons on the treatment of emissions entitlements. They can be further defined by analogy with similar rights regimes. Their nature is highly relevant to the emissions market, particularly to the commercial contracts that constitute it.

Climate change and global justice

AbstractIn this article, I examine matters concerning justice and climate change in light of current work in global justice. I briefly discuss some of the most important contemporary work by political philosophers and theorist on global justice and relate it to various considerations regarding justice and climate change. After briefly surveying the international treaty context, I critically discuss several issues, including climate change and human rights, responsibility for historical emissions and the polluter‐pays principle, the ability to pay principle, grandfathering entitlements to emit greenhouse gasses, equal per capita emissions entitlements, the right to sustainable development, and responsibility for financing adaptation to climate change. This set of issues does not exhaust the list of considerations of global justice and climate change, but it includes some of the most important of those considerations.WIREs Clim Change2012, 3:131–143. doi: 10.1002/wcc.158This article is categorized under:Climate, Nature, and Ethics > Climate Change and Global Justice

Climate agreements and India: aligning options and opportunities on a new track

The Climate negotiations in Copenhagen in December 2009 witnessed the emerging power of Brazil, South Africa, India, and China (BASIC). Although still focussed on domestic development goals, BASIC countries have made important steps toward a greater engagement in the global climate agenda. For India, the shift was marked by a voluntary, but conditional, target of reducing emission intensity, away from the past normative position based on “equal per capita,” emissions entitlements. The new track aims at finding cost-effective mitigation strategies that align national development goals and climate actions. This paper examines the mitigation potential of a domestic sustainable development policy using a suite of integrated assessment models. The long-term goal is to keep temperature increase below 2°C. This article shows that it is possible to match domestic development goals and climate mitigation. Win–win options exist and side benefits—in terms of energy security and local pollution—are important. However, development policies are not sufficient to achieve the desired emissions reductions. We find that it is necessary to introduce a constraint on the carbon budget. The price of carbon that emerges is however much lower than in a conventional mitigation scenario. Finally, this paper proposes to shift the negotiations away from the current climate-centric focus toward “development,” in order to reduce conflicts and deliver greater global and national benefits.

The logic of collective action and Australia’s climate policy*

We analyse the long‐term efficiency of the emissions target and of the provisions to reduce carbon leakage in the Australian Government’s Carbon Pollution Reduction Scheme, as proposed in March 2009, and the nature and likely cause of changes to these features in the previous year. The target range of 5–15 per cent cuts in national emission entitlements during 2000–2020 was weak, in that on balance it is too low to minimise Australia’s long‐term mitigation costs. The free allocation of output‐linked, tradable emissions permits to emissions‐intensive, trade‐exposed (EITE) sectors was much higher than proposed earlier, or shown to be needed to deal with carbon leakage. It plausibly means that EITE emissions can rise by 13 per cent during 2010–2020, while non‐EITE sectors must cut emissions by 34–51 per cent (or make equivalent permit imports) to meet the national targets proposed, far from a cost‐effective outcome. The weak targets and excessive EITE assistance illustrate the efficiency‐damaging power of collective action by the ‘carbon lobby’. Resisting this requires new national or international institutions to assess lobby claims impartially, and more government publicity about the true economic importance of carbon‐intensive sectors.

Carbon emissions reduction strategies and poverty alleviation in India

ABSTRACTThis paper, based on a computable general equilibrium model of the Indian economy, shows that a domestic carbon tax policy that recycles carbon tax revenues to households imposes heavy costs in terms of lower economic growth and higher poverty. However, the decline in economic growth and rise in poverty can be minimized if the emissions restriction target is modest, and carbon tax revenues are transferred exclusively to the poor. India's participation in an internationally tradable emission permits regime with grandfathered emissions allocation is preferable to any domestic carbon tax option, provided the world market price of emission permits remains low. Even better would be if India participated in a global system of tradable emission permits with equal per capita emission entitlements. India would then be able to use the revenues garnered from the sale of surplus permits to speed up its economic growth and poverty reduction and yet keep its per capita emissions below the 1990 per capita global emissions level.

Fairness aspects of linking the European emissions trading scheme under a long-term stabilization scenario for CO2 concentration

Climate equity is a crucial but difficult element in negotiations on a post-2012 climate regime. With respect to the trading of greenhouse gas emissions the equity aspect is considered in the Kyoto Protocol which demands that emissions trading should be supplemental to domestic abatement efforts. The question arises whether a linking of the European Union Emissions Trading Scheme (EU ETS) to non-EU emission trading schemes or the Clean Development Mechanism (CDM) could have an impact on principles of climate justice and thus potentially affect ongoing negotiations. In this study, we present the results of a three step analysis: In a first step, it estimates mid-term greenhouse gas emission entitlements for Annex B and Non-Annex B countries for the year 2020 which keep within reach a stabilization of the CO2 concentration at 450 ppmv in the long-term. In the second step, the resulting emission entitlements are used as an input to an economic partial-equilibrium model in order to assess the shift of abatement efforts under different scenarios of linking the EU ETS. In a third step, we analyze the outcome of the economic model with respect to the future trend of European per capita emissions under the current EU ETS relative to different scenarios of linking the EU ETS. The model results indicate that European per capita emissions have to be reduced to a considerably smaller extent if a linking of the EU ETS is accompanied by an optimal design of the National Allocation Plans and if low-cost CO2 permits became available via the CDM to a large extent.

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.

On the fair division of greenhouse gas abatement cost

This paper introduces a solution for the fair division of emission reduction costs in the climate change regime. Our primary focus is on the fair division of efficiency gains that arise from exchanging the initial allocation of emission entitlements, rather than the initial allocation itself. We propose to complement the competitive Walrasian solution with welfare bounds, the ethical justification of which rests on commonality of ownership. Simulations with an intertemporal computable general equilibrium model illustrate the relevance of such welfare bounds. For a wide range of initial allocations of emission entitlements – including an equal per capita allocation – we find that developing countries should be fully compensated for their emission abatement efforts, but should not receive any further transfers.

Equity implications of two burden-sharing rules for stabilizing greenhouse-gas concentrations

This paper focuses on the equity aspects of international burden sharing for global CO 2 emission stabilization. It first summarizes and classifies equity principles proposed in the published literature of the field. Of these, the authors selected three major equity principles, i.e., egalitarian equity, horizontal equity, and proportional equality (often referred to also as sovereign equity) to carry out a detailed examination of two sets of quantitative emission entitlements, which are based on two burden-sharing rules, i.e., the equal emissions per capita approach and the carbon intensity approach. The two burden-sharing rules were chosen as not only particularly popular, but also because their application results in distinctly different burden sharing among countries. To make the two rules comparable, we used a global carbon-emission path until the year 2050 that leads to an atmospheric CO 2 concentration of 550 ppm. We then used the two rules for allocating the global emissions described by that path to allocate carbon emission entitlements to 67 countries and 9 world regions. In general, developing countries receive relatively higher entitlements under the equal emissions per capita approach whereas industrialized countries are relatively better off under the carbon intensity approach. In some countries and regions, emission entitlements as calculated by any of the two burden-sharing rules are so low that it would be unrealistic to assume that actual emissions can be limited to the emission entitlements assigned to them without using flexibility mechanisms such as those defined in the Kyoto Protocol. In this sense, the calculated entitlements can be also interpreted as the initial allocation of tradable emission allowances of countries or regions. Nonetheless, we considered any numerical determination of resulting carbon trade flows to be outside the scope of our paper.

European Climate Policy: Burden Sharing after 2012

Regardless of whether or not the Kyoto Protocol enters into force, the EU may decide to set itself a long-term greenhouse gas emission target and thus to continue its leadership role in international climate policy. As for the first commitment period of the Kyoto Protocol, the EU may decide on a burden-sharing agreement as an integral part of such a long-term climate policy. Against this background I analyse three different options to distribute an overall budget of emission entitlements until 2042 among the member states of an enlarged EU. It is shown who wins and who loses with regard to compliance costs. As the member states' attitudes towards the different approaches are likely to depend on the relative attractiveness of the allocation options, a relevance threshold is introduced which may help to predict and understand the complexity of future climate negotiations in Europe.

Equity in international greenhouse gases abatement scenarios: A multicriteria approach

The climate change problem involves long-term global efforts through sustainable development. The international burden sharing of greenhouse gases (GHG) abatement constitutes a controversial debate. Equity is an important issue to be considered in the mitigation policies to insure the participation of as many developing countries as possible. The main purpose of this research is to allocate equitable international GHG emission entitlements using several criteria. There are many equity definitions and some are conflicting. A dynamical multicriterion method is proposed to compare various alternatives and to find a compromise solution. If the decision-making process can take into account interests and preoccupations of every country, significant progress could be made to achieve a world consensus. Several burden sharing schemes are proposed. Then, modeling abatement scenarios using the TIMES world energy model will allow us to determine the cost-effectiveness opportunities.

Contraction of Global Carbon Emissions: How Acceptable are Alternative Emission Entitlement Schemes?

The allocation of emission entitlements across countries is the single most controversal issue in international climate policy. Extreme positions within the policy debate range from entitlement based on current emission patterns (CEP) to equal-per-capita (EPC) allocations. Convergence (COV) from an initial CEP allocation towards EPC emission rights represents a reconciliation of the two. This paper maintains that the acceptability of alternative entitlement schemes depends on their implications for economic welfare and uses a dynamic multi-region general equlibrium model for a comparative economic asessment of the above allocation rules. We find welfare implications for the various regions to be strongly influenced by changes in the terms of trade. Especially, regions may experience considerable welfare losses even under entitlement schemes which impose no binding emission constraint on them. Among the arrangements examined, COV cum emissions trading stands out for offering the developing countries substantial incentives for participation in the international greenhouse gas abatement effort without imposing excessive burdens on the industrialized countries.

World post-Kyoto scenarios: benefits from accelerated technology progress

This paper addresses the issue of the potential benefits from technological change in post Kyoto CO2 emission reduction scenarios. In order to assess these benefits, it is necessary in Section 2 to define CO2 emission entitlements by world region, in a way that allows both for a significant global reduction from the reference in 2030 and for an acceptable burden sharing among world regions. The economic consequences of this entitlement scenario are explored in detail in Section 3, under the hypotheses of on-going trends for technology dynamics and of full world trading for emission permits. Section 4 then introduces the Stories, corresponding to hypotheses of breakthroughs in the performances and costs of six distinct power generation technology clusters. The Technology Stories and their impacts on CO2 marginal and total abatement costs are then studied in detail, both at world level and in a regional perspective. One key result of this paper is a quantitative assessment of the significant reductions in the compliance costs that may be expected from improvements in low-carbon generation technologies.