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Reflections from Barcelona

Last week's climate talks brought into relief the complex mix of politics and policies that countries are grappling with heading into COP-15 next month.

The stakes were high at the recently concluded Barcelona talks, the last formal negotiating stop before the United Nations Climate Change Conference (COP-15) begins in Copenhagen next month, at which countries hope to lay the groundwork for a low carbon future. Despite some progress, much urgently needed work remains to be done. The challenge now is for heads of state to engage each other on the core elements of an effective global climate agreement, and to build the trust needed for success in Copenhagen.

The Barcelona talks brought into relief the complex mix of politics and policies that countries are grappling with as they attempt to identify clear choices for their leaders. Two issues in particular received considerable attention: the “African walk out” and the question over whether an agreement will be “politically binding” or “legally binding.” The debate over the significance of these two issues preoccupied many journalists and observers, and on the latter may have diverted attention from the real issues at hand.

Africa and other vulnerable countries are terribly concerned that efforts by developed countries to reduce greenhouse gas emissions are far from adequate to prevent the worst impacts of climate change. The “walk out” was intended to remind the rest of the world that these countries have some political muscles to flex, if they so choose.

Meanwhile, the media portrayal missed the main point on the question of politically and legally binding commitments. Namely, while there seems to be a common desire for a legally binding final agreement in Copenhagen (including the main substance of the Bali Action Plan), there is also growing recognition that the exact form of that legally binding agreement may take a extra few months to decide. Indeed, the Bali Action Plan stated that there should be an “agreed outcome” in two years but did not specify whether it should be legally binding or not. Therefore, what came out of Barcelona from negotiators was less a statement about the intended legal form than the timescale needed to get everything completed. The crucial decisions on whether there will indeed be a legally binding instrument—and the process to complete it—have thus been left to the last possible minute, in Copenhagen. There is ample room for negotiations to unravel in this sphere, and attention to detail will be critically important.

Beyond these two headline grabbers, the key issues remain the same after Barcelona as before. First, how much commitment to countries have to reduce emissions---in the form of economy-wide emission reduction targets for developed countries, and below business-as-usual goals for large developing countries? Second, how much support will industrialized countries provide for developing countries to decarbonizes their economies, reduce emissions from forest loss, and adapt to the inevitable consequences of climate change?

In addition, a new but nonetheless critical issue captured attention in Barcelona: what rulemaking architecture should countries adopt for the emerging agreement?

For the uninitiated, there are now two tracks of talks taking place at the UN climate negotiations. The first is the Kyoto Protocol track, which aims to reach agreement on the next round of emissions reduction targets by industrialized countries. The second is the UN Framework Convention on Climate Change (UNFCCC) track, which is discussing a U.S. target, emission reduction actions by developing countries, and associated new support mechanisms. A key question for this second track is what kind of rulemaking system will be agreed to ensure that countries comply with their commitments.

Why Is a Rulemaking System Important?

When the international agreement comes into effect, it will need common methodologies and rules to track greenhouse gas emissions and apply common international accounting and trading standards.

Such rules will be particularly important for a global carbon market to operate effectively and drive down the cost of climate change mitigation. Just like currency markets, carbon markets also need recognized standards so that buyers can be certain that a ton is a ton is a ton. For example, rules must ensure that an offset credit issued from a project in India was developed using similar standards to an offset credit issued in Mexico, and that an independent third-party approved and verified the projects.

Uniform rules will also be important in national accounting. Without international standards, countries could make up their own rules, and would no doubt choose criteria that fit their national interests, leading to competitiveness concerns. For example, Russia, a densely forested country could decide only to count its forests as carbon sinks and to ignore the role of cleared forests as sources of greenhouse gas emissions. If the United States instead count both forestry sinks and sources, there would be a significant accounting imbalance. It would also be difficult to track national rules if there were an accounting free-for-all.

Next Steps: All to Play For in Copenhagen

The Barcelona talks helped to clean up a weighty negotiating text and clarify the options available as the Copenhagen deadline looms. Some issues, notably financing for climate adaptation and how to reduce emissions from deforestation, made some progress. Many delegations also promoted an international agreement that encourages the exchange of transparent, scientifically based, information among all countries. Such an approach would help build confidence in a new international climate agreement, by helping to ensure that countries undertake the actions to which they are committed, and by promoting the development of an effective international carbon market.

Before Copenhagen, a series of ministerial and heads of state meetings will be held around the world where preparation for the climate summit will play a prominent role. Among them are President Obama’s trip to China and other Asian nations, the pre-Copenhagen ministerial meeting in mid-November, and the Commonwealth heads of government meeting in Trinidad the first week of December. Each of these must be used to bring countries closer together so that a fair, ambitious and binding deal is possible in the Danish capital. There is still all to play for in Copenhagen.

UNFCCC

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