Incentive Aspects of Joint Implementation of Greenhouse Gas Reduction

The costs of a national climate policy instruments can be reduced if a reduction of greenhouse gas emission achieved abroad can be credited to a national target. Reductions carried through by agents of one country in another country are called Joint Implementation and have been a major topic in the negotiations on the UN Framework Convention on Climate Change. The First Conference of the parties in Berlin decided that the concept shall be tested in a pilot phase without crediting. To induce private investments in Joint Implementation projects, primary instruments such as emission taxes, subsidies, tradeable emission rights or regulation are a necessary condition. Tax concessions, subsidies, additional emission rights or relaxation of regulation act as incentives. These must be proportional to the emission reduction achieved through the projects. Tax concessions and subsidies are preferable to other instruments for efficiency reasons.     

CDM in the Kyoto Negotiations:

The Clean Development Mechanism (CDM) under the Kyoto Protocol to the UN Framework Convention on Climate Change (UNFCCC) has its origins in the decade of UNFCCC negotiations. ‘Joint implementation’ and ‘activities implemented jointly pilot’ opened the door for the project-based mechanisms between developed and developing countries. The US proposal of the Joint Implementation in the Kyoto Protocol negotiations was almost identical with CDM approved in Kyoto; however, a detour around the Clean Development Fund (CDF) concept raised by Brazil in the negotiations catalyzed the mutual understanding on the win-win nature of the concept of joint implementation.CDM has been played an important role to bridge the developed and developing countries in its development process initiated as the joint implementation in the UNFCCC, and can lead to the cooperative future in the implementation stage starting from the year 2003, including the development of future commitments beyond 2013. This revised version was published online in August 2006 with corrections to the Cover Date.     

Integrating Joint Implementation Projects for Energy Efficiency on the Built Environment with White Certificates in The Netherlands

In this paper we analyze policy interactions between two innovative climate and energy policy instruments, namely White Certificates (WhC) and Joint Implementation (JI) that target at energy efficiency improvement and reductions of Greenhouse Gas (GHG) emissions. We have selected The Netherlands and Bulgaria as a case study given that the former has a cumulated experience in energy efficiency policies and the latter for a growing potential in JI projects as a host country. Based on a method of analyzing policy interactions, we demonstrate how a possible design of such a scheme can take place and how it should function. A couple of parameters that deserve attention are a baseline definition and a conversion rate for credits. Our basic finding is that an integrated scheme is complementary and can assist substantially in achieving Dutch national United Nations Framework Convention on Climate Change (UNFCCC) Kyoto Protocol targets. Dutch electricity and gas suppliers (parties that receive energy efficiency obligations) can implement energy efficiency projects domestically and in other countries, hence reducing total abatement costs. Furthermore, such a scheme can stimulate further energy efficiency actions from other stakeholders participating in energy markets. Based on an ex-ante assessment, a carefully designed hybrid WhC and JI scheme appears to be effective in terms of targets, efficient, generating positive impacts on markets and society, while uncertain in stimulating innovation.

Climate change and local level disaster risk reduction planning: need, opportunities and challenges

The field of climate change is full of uncertainties that are limiting strategic disaster risk reduction planning. In this paper, however, we argued that there is lot to do before we get our hands on reliable estimates of future climate change impacts. It includes bringing together different stakeholders in a framework suggested in this paper, developing case studies that reflect long-term local impacts of climate change, capacity building of local stakeholders that enables them to take decisions under uncertainty etc. We proposed a simple scheme that brings together climate, disaster and policy community together to start a dialogue in a run-up to understanding wider aspects of long-term risk reduction at local level. Strategic thinking, which has only been restricted to national and regional planning to date, needs to be inculcated in local level disaster risk reduction and policy personnel as well. There is a need to move from the attitude of considering local level players as ‘implementers’ to ‘innovators’ for which developing a network of self learning and evolving organizations are required at the local level.     

Towards an efficient and low carbon economy post-2012: opportunities and barriers for foreign companies in the Russian energy market

Russia is one of the most energy- and carbon-intensive countries in the world. The high level of technical abrasion and a low level of investments into modernization of the Russian energy industry cause huge energy wastage and carbon emissions. This situation is regarded by countries relying on energy imports from Russia as an increasing threat to security of supply and as a major barrier to global climate change policy. This paper provides an overview of the current and future Russian energy efficiency and greenhouse gas mitigation policies. The focus is laid on the detailed investigation of the progress and future potential of the market-oriented mechanisms Joint Implementation (JI) and Green Investment Scheme (GIS), being considered as two possible channels for FDI in transnational energy efficiency and carbon mitigation projects. The analysis was conducted by reviewing the relevant scientific and non-scientific literature including a variety of theoretical and practice-oriented arguments. Based on this assessment, we conclude that JI and GIS are confronted with numerous barriers in the Russian energy market. We further scrutinize the ability of Energy Service Companies (ESCOs), as one of the market intermediary models, to overcome some of these barriers in the process of effectively integrating JI and GIS in their long-term business strategies. Due to the compatibility of the main features of JI and GIS with the working procedures under the ESCO model we conclude that numerous synergy effects can be generated and that the majority of transaction barriers specific for the Russian energy market can be overcome. Such an integrative framework for international energy efficiency and carbon mitigation projects would contribute to the modernization of the Russian energy industry and enable a “win-win” situation for foreign companies seeking to invest in a sustainable manner.     

Adaptation to climate change: the attitudes of stakeholders in the livestock industry

It is now widely accepted that climate change is happening and that future changes will impact on many aspects of society, including agriculture. To maintain food supplies, the agricultural industry must address climate change adaptation. Key to this is the attitudes of those within the industry likely to have responsibility for adapting. This study investigated stakeholder attitudes towards adaptation to climate change in the livestock industry. Findings reveal four attitudinal groups. First, there is a ‘farmer-focused group’ that has a positive attitude about the ability of livestock farmers to adapt to climate change, but that also has the opinion that they will need additional support to adapt. Second, there is an ‘incentive for enterprise, anti-GM (genetic modification) group’ with an attitudinal position stressing that the government should have a role in implementing regulations and providing finance. This group has a negative attitude towards GM technology and does not think it will be the answer to climate change. Third, there is an ‘information and education group’ whose attitude is that the provision of information is crucial for ensuring that the livestock industry adapts. Fourth, there is a ‘pro-technology group’ who have a positive attitude towards GM technology and who are therefore willing to embrace it as the route to adaptation. Three of these four groups favour soft adaptations that maintain flexibility within the system, and only the fourth is of the opinion that adaptive capacity is not an issue and that the industry is ready to implement hard adaptations.     

Framing adaptation to climate-related extreme events

Whilst mitigation has dominated policy and research agendas in recent years there is an increasing recognition that communities also need to be preparing for change that is unavoidable, partially a consequence of anthropogenic greenhouse gases already emitted to the atmosphere. The perceived need for adaptation has also received additional impetus through the high public profile now given to the impacts of current day weather variability, particularly the significant economic and social costs associated with recent extreme events. However, being a relatively new focus for both research and policy communities; practical evidence of the extent, feasibility, efficiency, and cost effectiveness of potential adaptation options remains largely lacking. In response, this paper seeks to make a contribution to this embryonic but evolving knowledge base by considering the theoretical underpinnings of adaptation and ultimately how this translates into practice ‘in the real world’. The analytical commentary, based on a bottom-up approach involving iterative engagement with key stakeholders and experts, reflects on the identification of measures that are either innovative or examples of good practice in reducing or transferring climate risks, as well as considering those ‘enabling’ institutional structures and processes that act to support implementation on the ground. The paper concludes by synthesising the key findings to date in order to highlight some of the opportunities for, and barriers to, adaptation activity.     

Ancillary impacts of energy-related climate change mitigation options in Africa’s least developed countries

This article analyses the debate associated with the ancillary impacts of climate change mitigation options in developing countries, with a particular focus upon Africa’s 34 least developed countries. While these countries’ emissions of greenhouse gases are relatively small (and they do not have emission limitation commitments in the current international regime), inattention to the mitigation agenda would mean that developing countries both miss potential funding opportunities and fail to ‘climate-proof’ their development strategies. A focus, therefore, upon the short-term, local, developmental impacts that serve to change the relative attractiveness of different mitigation options from the perspective of the developing country is in these countries’ current strategic interests. In this article, I examine three energy-related climate change mitigation options: improved cookstoves, carbon-free electricity and improved energy efficiency in industry. Key ancillary impacts are better indoor air quality, better outdoor air quality and job creation (respectively). Further work to strengthen the evidence base regarding these impacts needs to be undertaken, potentially drawing upon broader work that has already been completed. Thus, in conclusion, a call for cross-fertilisation of information between heretofore disparate research communities is made. Additionally, the development of an integrated research agenda, forging linkages among cookstoves, indoor air quality and climate change mitigation research communities in Africa’s least developed countries, is identified as a priority.     

Global Carbon Dioxide Emissions Scenarios: Sensitivity to Social and Technological Factors in Three Regions

Carbon dioxide emissions from 1990 to 2100 AD are decomposed into the product of four factors: population size, affluence (measured here as GDP per capita), energy intensity (energy use per unit GDP) and carbon intensity (carbon dioxide emissions per unit energy). These emissions factors are further subdivided into three regions: more developed countries (MDCs), China, and the remaining less developed countries (LDCs). Departures from a baseline scenario (based on IPCC, 1992a — the so-called ‘business-as-usual’ scenario) are calculated for a variety of alternative assumptions concerning the four emissions factors in the three regions. Although the IPCC scenario is called a ‘non-intervention’ scenario, it is shown, for example, that large decreases in energy intensity in China or carbon intensity in MDCs are built into the ‘business as usual’ case — and such large changes vary considerably from region to region. We show what CO₂ emissions would look like if each of these four emissions factors projected in the baseline case somehow remained constant at 1990 levels. Certain factors like energy intensity improvements and long-term population growth in LDCs, or GDP growth and carbon intensity improvements in MDCs, are shown to have a big contribution to cumulative global emissions to 2100 AD, and consequently, changes in these projected factors will lead to significant deviations from baseline emissions. None of the scenarios examined in this analysis seems to indicate that any one global factor is clearly dominant, but cultural, economic, and political costs or opportunities of altering each factor may differ greatly from country to country.     

e-Serem – A Web-Based Manual For The Estimation of Emission Reductions From JI and CDM Projects

This paper presentse-SEREM (Smart Emission ReductionEstimation Manual), a cost-free, easilyaccessed and updated, web-based manual forestimating emission reductions from Joint Implementation (JI) andClean Development Mechanism (CDM) projects. e-SEREM's main functions arethe selection of a benchmark for a specificproject type in the power or heat sectorand the calculation of the annual andcumulative emission reductions accrued bythis project for its crediting lifetime.e-SEREM was developed in order to test itsapplicability and practicality in assistingproject developers and evaluators toelaborate baselines easily and calculatethe emission credits earned by candidate JIor CDM projects hosted in several countries.     

Global Climate Change Mitigation and Sustainable Forest Management — The Challenge of Monitoring and Verification

In this paper, sustainable forest management is discussed within the historical and theoretical framework of the sustainable development debate. The various criteria and indicators for sustainable forest management put forth by different, institutions are critically explored. Specific types of climate change mitigation policies/projects in the forest sector are identified and examined in the light of the general, criteria for sustainable forest management. Areas of compatibility and contradiction between the climate mitigation objectives and the minimum criteria for sustainable forest management are identified and discussed. Emphasis is put on the problems of monitoring and verifying carbon benefits associated with such projects given their impacts on pre-existing policy objectives on sustainable forest, management. The implications of such policy interactions on assignment of carbon credits from forest projects under Joint Implementation/Activities Implemented Jointly initiatives are discussed. The paper concludes that a comprehensive monitoring and verification regime must include an impact assessment on the criteria covered under other agreements such as the Biodiversity and/or Desertification Conventions. The actual carbon credit assigned to a specific project should at least take into account the negative impacts on the criteria for sustainable forest management. The value of the impacts and/or the procedure to evaluate them need to be established by interested parties such as the Councils of the respective Conventions.     

Perspectives on Finland’s sustainable consumption and production policy

The Finnish approach that is starting from the basic human needs of food, housing, mobility and related lifestyles enables us to address the social dimension of sustainable development alongside the ecological and economic dimensions. In this context environmental problems cannot be resolved in isolation from people’s everyday lives, as can happen if environmental policies are based purely on emissions.But it is also worth questioning the potential for national SCP programmes in today’s global markets. Over the last ten years, domestic material flows within the Finnish economy have remained fairly constant, with gains in material efficiency cancelled out by increasing levels of material consumption. However, external material flows and the consequent environmental impacts have steadily increased, and the magnitude and environmental impacts of both imports and exports are approximately the same as for domestic flows. This means that the role of external material flows can no longer be ignored in national SCP policies.It is also important to integrate SCP with climate policies. Finland’s national climate and energy strategy is mainly based on the need to reduce CO₂ emissions from energy production and industrial installations, but there is also a need for complementary actions to reduce the carbon footprints caused by private and public consumption.     

Adaptation Options Strategies for Hazards and Vulnerability Mitigation: An International Perspective

The broad objective of this special issue of Mitigation and Adaptation Strategies for Global Change is to address some of the gaps in our knowledge and understanding of the policies, programs, and measures that might be applied to natural hazards and their impacts in an era of climate change. Given the global impacts of climate change and world-wide pattern of increasing losses from natural hazards we necessarily adopt an international perspective. The specific goals of the special issue are to: (a) encompass experiential aspects, emphasizing current practice of mitigation and its associated measures, and their results; and (b) explore primary or root causes of alarming shifts in human and economic costs of environmental extremes. Special emphasis is placed on how human activities are playing a key role in enhancing vulnerability to NTEE (nature-triggered environmental extremes), quite independently from the anthropogenic causes of climate change. The goals are also (c) to examine costs, risks, and benefits (of all kinds including social, political, ecological) of mitigation, and adjustment and adaptation measures; and (d) analyze policy implications of alternative measures. These components are expected to make significant contributions to policy considerations – formulation, implementation and evaluation. There is much uncertainty about the rate of climate change; however, the fact of increase of the atmospheric temperature in the last century is no longer a subject of scientific or policy debate. Due to such changes in the geophysical parameters, certain types of nature-triggered environmental extreme events are likely to continue to increase. How global warming will affect regional climates and pertinent variables is not well known, limiting our ability to predict consequential effects. This factor poses serious constraints against any straightforward policy decisions. Research findings of the work of this volume reaffirm that human dimensions, specifically our awareness and decision-making behavior, are powerful explanatory factors of increasing disaster losses. Disaster mitigation through addressing human, social, and physical vulnerability is one of the best means for contributing to ‘climate change adaptation plans’, and sustainable development goals. Recent lessons from various countries have depicted that the formulation of mitigation strategies cannot be exclusively top-down as it requires social, political, and cultural acceptance and sense of ownership. An interactive, participatory process, involving local communities, produces best expected outcomes concerning mitigation, preparedness, and recovery. An emerging consensus is that there is a need to move towards the ‘mission’ of the International Strategy for Disaster Reduction which aims at building disaster resilient communities by promoting increased awareness of the importance of disaster reduction as an integral component of sustainable development, with the goal of reducing human, social, economic and environmental losses due to natural hazards and related technological and environmental disasters. Sharing of best practices and lessons globally is certain to produce more efficiency and understanding in policy and decision making.     

Constituting leadership via policy: Sweden as a pioneer of climate change mitigation

This paper examines Sweden’s role as a pioneer in mitigating climate change. Critical discourse analysis of climate and energy policy unveils Sweden’s ambition to ‘lead-by-example’, by virtue of a win–win combination of economy and environment via stringent regulations and an early-mover strategy on eco-innovations. The extent of the unilateral approach is constrained by concerns for the competitiveness of energy-intensive industries and a persistent debate on the fate of Swedish nuclear power. Whilst Sweden has made significant demonstrative progress in reducing emissions and introducing renewable energy sources, these issues may limit her role as a pioneer in years to come.     

Reconciling Emissions Trading with a Technology-Based Response to Potential Abrupt Climate Change

It has been shown that preparedness to respond effectively to imminent abrupt climate change, getting CO₂ levels down towards pre-industrial in a few decades, involves the promotion of specific technology types that can be the basis for a negative emissions energy system (Read and Lermit 2003/5). In particular, Bio-Energy technologies linked to technologies for CO₂ Capture and Storage (BECS) or to other carbon disposal technologies, if done on a sufficiently large scale, can achieve this result given a context of policy urgency that also yields advances in energy efficiency and the take up of ambient energy technologies (wind, solar, etc.) in line with low emissions energy scenarios (e.g. the fossil free energy scenario developed by the Tellus Institute for Greenpeace International (Lazarus et al. 1993). It has also been shown (Read 1999, 2000, 2000a) that, if account is taken of inter-temporal beneficial learning externalities, it is efficient to reward innovation in policy-desirable technology types (e.g. through project-based schemes that embody such technology types) by a greater amount than the penalty on emissions. Such dynamic efficiency can be achieved through establishing a secondary market for project based credits exchanged for a number of emissions permits M(t) (M > 1 for t < H, the time horizon for policy) and with the variation of M(t) over time corresponding to the dynamically efficient path. This results in the incentive for project based emissions reductions being M(t) times greater than the penalty on emissions. By making use of the initial allocation of permits in each time period, an aspect of emissions permit trading that has no efficiency function under either auctioning or ‘grand-fathering’, this arrangement enables project based credits to be administered flexibly whilst ensuring the integrity of the emissions cap. The purpose of this article is to link these two bodies of work to show how a dynamically efficient response to the threat of abrupt climate change can be implemented in a way that is compatible with the response to gradual climate change that has been negotiated in the Kyoto Protocol. The design of such a dynamically efficient mechanism is considered, having as its objective the promotion of the two technology types mentioned above. A particular institutional model for implementing such a mechanism is described that mimics managerial behaviour in the adoption of new technology, avoids the additionality requirement that burdens the operation of the CDM in its current form, and aims to achieve ‘industry friendliness’ as a necessary condition of effective implementation.     

Climate vulnerability index - measure of climate change vulnerability to communities: a case of rural Lower Himalaya,India

Climate Vulnerability Index (CVI) is being proposed to assess climate change vulnerability of communities with a case study. The index consists of household parameters of all the three dimensions of vulnerability such as Exposure, Sensitivity and Adaptive Capability. Exposure is defined by ‘Natural disaster and Climate variability’, however Sensitivity by ‘Health’, Food’, and ‘Water’ and Adaptive Capability by ‘Socio-demographic profile’, ‘Livelihood strategies’, and ‘Social networks’. Respective parameters were based on the peers and literature. The CVI vulnerable status ranges from high (0) to low (1). Household questionnaire survey was undertaken from two regions namely, near to district (NDH) and away to district (ADH), in Srinagar, Uttrakhand, India. Data for desired parameters for CVI was collected from 50 randomly selected households. Data were aggregated using a composite index and differential vulnerabilities were compared. High vulnerability was observed for livelihood strategies, food and natural disaster for ADH households, and health and water for NDH households. It was found that the adaptive capability and sensitivity of ADH households was higher than NDH, however, exposure realization was similar in both the regions. The CVI was 0.69 and 0.64 for NDH and ADH, respectively, suggests high vulnerability to NDH households. This pragmatic CVI approach may be used to assess and monitor vulnerability under various stress condition, and/or evaluate potential program/ policy effectiveness in various data-scarce regions by comparing various anticipated scenarios with baseline. Further, the result obtained by index may have implications for developing adaptation or coping strategies to the region.     

Economic impacts of climatic variability and subsidies on European agriculture and observed adaptation strategies

In order to assess agricultural adaptation to climate impacts, new methodologies are needed. The translog distance function allows assessing interactions between different factors, and hence the influence of management on climate impacts. The Farm Accountancy Data Network provides extensive data on farm characteristics of farms throughout the EU15 (i.e. the 15 member states of the European Union before the extension in 2004). These data on farm inputs and outputs from 1990−2003 are coupled with climate data. As climate change is not the only change affecting European agriculture, we also include effects of subsidies and other changes on inputs and outputs of farms throughout Europe. We distinguish several regions and empirically assess (1) climate impacts on farm inputs and outputs in different regions and (2) interactions between inputs and other factors that contribute to the adaptation to these impacts. Changes in production can partly be related to climatic variability and change, but also subsidies and other developments (e.g. technology, markets) are important. Results show that impacts differ per region, and that ‘actual impacts’ cannot be explicitly separated into ‘potential impacts’ and ‘adaptive capacity’ as often proposed for vulnerability assessment. Farmers adapt their practices to prevailing conditions and continuously adapt to changing conditions. Therefore, ‘potential impacts’ will not be observed in practice, leaving it as a mainly theoretical concept. Factors that contribute to the adaptation also differ per region. In some regions more fertilizers or more irrigation can mitigate impacts, while in other regions this amplifies impacts. To project impacts of future climate change on agriculture, current farm management strategies and their influence on current production should be considered. This clearly asks for improved integration of biophysical and economic models.     

Foresty offsets in emissions trading systems: a link between systems?

An important aspect in the linking of different emissions trading schemes is the degree to which these systems allow (or ban) external offset project categories. The EU Emission Trading Scheme (EU ETS) currently allows the use of credits from energy and industry projects developed under the Kyoto Protocol’s Joint Implementation (JI) and Clean Development Mechanism (CDM) but excludes the use of carbon credits from forestry projects for compliance in the EU ETS. Forestry credits generated by the CDM have a limited lifetime and expire at the end of a project’s crediting period, or earlier if the carbon stock for which the credits have been issued ceases to exist. According to the recently adopted amendment of the EU ETS Directive forestry credits will remain to be excluded until 2020. The present article reviews how the New South Wales Greenhouse Gas Abatement Scheme (Australia), the Regional Greenhouse Gas Initiative (US) and the voluntary scheme of the Chicago Climate Exchange integrate forestry offsets into the respective system and how they deal with the risk of losing stored and credited biomass. By comparing the results of different scenarios this article shows how differences in the treatment of forestry offsets could impact the efforts to link various emission trading systems in future.

Air pollution policies in Europe: efficiency gains from integrating climate effects with damage costs to health and crops

Emissions of air pollutants cause damage to health and crops, but several air pollutants also have an effect on climate through radiative forcing. We investigate efficiency gains achieved by integrating climate impacts of air pollutants into air quality strategies for the EU region. The pollutants included in this study are SO₂, NH₃, VOC, CO, NO_x, black carbon, organic carbon, PM_2.5, and CH₄. We illustrate the relative importance of climate change effects compared to damage to health and crops, as well as monetary gains of including climate change contributions. The analysis considers marginal abatement costs and compares air quality and climate damage in Euros. We optimize abatement policies with respect to both climate and health impacts, which imply implementing all measures that yield a net benefit. The efficiency gains of the integrated policy are in the order of 2.5 billion Euros, compared to optimal abatement based on health and crop damage only, justifying increased abatement efforts of close to 50%. Climate effect of methane is the single most important factor. If climate change is considered on a 20- instead of a 100-year time-scale, the efficiency gain almost doubles. Our results indicate that air pollution policies should be supplemented with climate damage considerations.     

Bamboo in climate change and rural livelihoods

Climate change negotiations, assessments, and greenhouse gas inventory guidelines have all but bypassed bamboo. Disallowing stands of tree-like bamboos as forests disparages their function in the carbon (C) cycle, and disregards pillars of smallholder livelihoods. Exposing bamboo not as a panacea, but as an overlooked option for C conservation, sequestration, and adaptation, we screen details of distribution, morphology, growth, physiology, and impacts for pertinence to climate change. Additional to 40 million hectares of existing bamboo forests, many potential host countries for C projects harbor suitable sites. Definitions, methods and default values, such as the root/shoot- ratio, biomass conversion factors, allometric equations and sampling variables need adjusting. Rapid maturation, persistent rhizomes, a rich palette of species, and wind-firmness may mitigate risk. Bamboos can accommodate agro-and urban forestry, and reign in unsustainable shifting cultivation. Distribution functions of bamboo biomass stocks and growths do not deviate drastically from those of trees. If anything, bamboo stocks are slightly lower, and growths slightly higher, with medians of 87 t*ha⁻¹ and 10.5 t*ha⁻¹*yr⁻¹, respectively. However, bamboo’s outstanding socio-economic effects might well determine its future in mitigation and adaptation. Early, continuous yields, selective harvesting on even small parcels of land, low capital and high labor intensity, virtually 100% conversion efficiency to about 1,500 products, and, typically, 75% of economic returns benefiting rural people are advantageous attributes. Regional studies on suitability, silviculture, yields, economics, risk, and C assessment would strengthen bamboo’s function as ‘the poor man’s timber’ and promote its niche as the smallholder’s C sink.