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6/30/13 Mrunal » Kyoto Protocol, Carbon Trading , Copenhag en Accord: Meaning, Explained » Print

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These meetings are called Conference of the Parties (COP)

The first COP (COP 1) was held in Berlin.

Third COP (COP 3) held in Kyoto, Japan. It was here the famous Kyoto Protocol

came in to existence.

2011: COP held in Durban, S.Africa.

2012: COP will be held in Doha, Qatar in November 2012 (so it becomes

important topic for next prelims!)

What is Kyoto Protocol?

1997: third meeting of UNFCC nation (also known as Conference of

Parties/COP3),

In this meeting Kyoto Protocol was created.

Kyoto protocol wants the Industrialised nations to reduce their green house gas

emission by around 5.2% by 2012. (measured against 1990 levels)

Before dwelling much into Kyoto, some important terms.

What is “common but differentiated responsibilities”?

The developed countries such as US,UK have already polluted the atmosphere

with greenhouse gases (GHGs) through industrialization. So they’re the one who

created/started global warming and all the mess.

While Developing countries (India and Brazil) have started polluting the world

only recently.

Therefore, the developing countries such as India, Brazil should share less of the

burden of lowering overall emissions.

And Developed countries (US,UK) should bear more responsibility in fixing thisglobal warming mess etc. because they’re the one more responsible for it.

So, while it is the “Common” responsibility of every nation of this world, to

reduce Green house gas emission, but there should be some difference between

the responsibility given to developed countries and developing countries.

Kyoto Protocol follows that principle and assigns separate responsibilities to

the countries.

Annex

Annex means some elaboration/detail given at the end of a book/treaty.

Annex What?

Annex

I

List of industrialized countries and economies in transition: US,

France, Japan etc.

These countries had pledged to reduce their greenhouse gas emissions

to 1990 levels by the year 2000.





Annex

II

A sub-group of Annex 1 Countries, these Annex II countries are

required to give financial assistance and technology to the developing

countries (non-Annex countries).

Non

Annex

Developing countries like India, Brazil, China.

They donot have compulsory binding targets to reduce green house gas

emission, although they are encouraged to do it.

Annex

A

It gives the list of 6 Green House gases that are responsible for the whole

problem

1. Carbon dioxide (CO2);

2. Methane (CH4);

3. Nitrous oxide (N2O);

4. Hydrofluorocarbons (HFCs);

5. Perfluorocarbons (PFCs); and

6. Sulphur hexafluoride (SF6)

Annex

B

This gives the Annex I countries (Developed countries) – compulsory

binding targets to reduce green house gas emission.

For example USA is required to cut down its emission by 7%

Back to Kyoto Protocol

Ok, so far we learned that

In Earth Summit, Rio De Janero, Brazil, they formed a treaty called UNFCCC

The UNFCCC gangsters meets every year, there is item song, gun-firing,

consumption of desi-liquor and deliberations on how to fix the global warming

problem and these meetings are called Conference of Parties “COP”.

In third such COP meeting @Kyoto, Japan, they come up with an idea under

which

Developed nations like US, will compulsorily reduce their green house gas

(GHG) emission by 2012.

Developing nations like India, should reduce GHG emission but notcompulsory.

Although various countries signed Kyoto Protocol in 1997, it did not came into

force immediately.

Kyoto protocol came into force only after required number of Annex 1

Countries ratified it.

So this was achieved only in 2005.

Thus, Kyoto although signed in 1997, came into force in 2005.





Kyoto protocol: How does it actually work?

Suppose Abdul, Bhide and Champak (ABC) goto a Gujarati dining hall. This hall

serves only ‘fixed dish’ i.e. 1 sabji, 4 roti,dal and rice. And each dish costs

Rs.50. If you want more roti then you’ll have to pay extra 5 rupees per roti.

Now Champak is an old man so he cannot eat all the 4 rotis served in his plate.

He eats only two rotis.

On the other hand, Abdul and Bhide are quite hungry, so they want more, theytake 1-1 roti each from Champak’s plate and agree to pay 5-5 rupees to him.

Another example: You know how broadband internet billing works= there are

plans for example 2GB plan for Rs.500 That means as long as you download

music, movies etc. worth less than or equal to 2GB then you’ll get bill of Rs.500

but if you download more files above 2GB quota, then company will charge you

Rs.1 per MB of extra download.

Similarly, Under Kyoto Protocol, each Annex-B country is given emission target

“quota” (Kyoto Units).

For example, for the year 2009, Australia’s allowed quota was 2,957,579,143Kyoto units. (each unit is equivalent to 1 ton of carbon dioxide)

Now, as long as Australia emits that much green house gas= no problem.

So first of all, Australian Government should do all steps to make sure it doesn’t

cross that quota for example

Making compulsory anti-pollution laws: for example a Tire making

company with daily output of 200 tires must not emit more than 200

tonnes of green house gas per year.

Promoting solar energy, reducing tax on solar cells, wind mill equipments

etc.

If a family buys second car then it will have to pay higher tax (just likeChina’s one child policy but with cars!)

if a kid is found bunking his college lecture and loitering on his motorbike

then he’ll be fined for polluting the environment.

But even after all these measures, if Australia wants to emit more green house

gas, then it will have to buy additional ‘quota or units’ from another country.

Kyoto Protocol allows three mechanisms to do so

#1 Emissions Trading / Carbon Trading

Suppose two Annex B parties are Japan and Australia.

Japan was given quota of 100 units

And Australia was given quota of 200 units.

But Austrialian Government is unable to maintain this limit and Australia emits

210 units of green house gas, in given year.

On the other side, Japanese Government takes very strong steps to control

emission and hence they only emit 90 units of Green House gas. So it has spare

10 Kyoto Units.

Now, under Emission trading system, Australia can buy this 10 spare kyoto units





from Japan and thus remain within its limit.

In real life scenario, each annex B country makes law giving fixed quota to the

companies.

Suppose steel factory cannot emit more than 1 ton of Green house gas

Tire company cannot emit more than 2 tonnes of green house gas.

So if tire company owner buys superfine machinaries that produce less gas

so he has some spare credit/quota (say 1 ton)

While Steel factory emits more than its allowed quota (suppose it wasallowed 2 tonnes but emitted 3 tonnes)

Then the steel company can pay the tire company and get a certificate that

we’ve purchase 1 ton quota from this xyz tire company. This Is the essence

of “Carbon Trading .”

Here are some charts to understand it better. But the text in below image is hard

to read (because the original images were in low quality). Solution =just hold

down “Ctrl” Key on your keyboard and move your mouse-wheel upwards and it’ll

zoom the image.

http://www.connectm.com/imgs/trading_scheme_img.jpg







emission has increased to 11 units. (1 more unit above the quota)

So this company can also do some solar-projects in India, Brazil etc. and

get a certificate that it has led to reduction of 1 unit of GHG emission. =

problem solved.

#3 Joint Implementation (JI)

This is identical to CDM.In CDM, Australia can do good project in a non-Annex country (developing

country) e.g. India.

In Joint Implementation, Australia can do the good project in another Annex B

country e.g. Japan to meet the quota.

Why USA did not ratify Kyoto Protocol?

US President George W Bush refused to ratify Kyoto protocol saying that it

would gravely damage the US economy.for example a US steel company would need to either buy Carbon Credits from

another company or invest in some projects in a developing country), while an

Indian or Chinese Steel company has no such obligation so their cost of

production = low, hence they can sell their products @lower MRP = US steel

company will loose customers.

So US Government feels is that the treaty is fatally flawed, because it does not

require developing countries (especially India and China) to commit to

emissions reductions.

After President Bush, President Obama too, didn’t ratify Kyoto protocol for the

same reason. (plus we should also understand that the powerful US industrialistlobby may stop election funds to a candidate, if he is in favor of Kyoto protocol,

so USA is unlikely to ratify Kyoto or any such future protocols that are legally

binding!)

Canada Quits Kyoto protocol

In 2011, Canada, become the first country to quit the Kyoto Protocol on

climate change, saying the 1997 accord was handicapped because top green

house emitters like the United States and China not covered by it. (Because USAhas refused to ratify the treaty and China being an Annex II country –has no

compulsory responsibility to cut down emission.)

What is the Copenhagen Accord?

Recall that UNFCCC countries meet every year and it is calledConference of

Parties (COP).

15th such meeting was held @Copenhagen, Denmark = COP15





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Mrunal » Kyoto Protocol, Carbon Trading, Copenhagen Accord_ Meaning, Explained » Print