Climate change and fossil fuels V Filip Cernoch cemoch@jnail.muni.cz CENTER FOR ENERGY STUDIES Climate change as a public policy problem •Is uniquely global • Environmental problems usually regional (Beijing's smog, waste from EU's industry) • In the case of climate change, impacts may be regional, but phenomenon is global • The global nature of climate change also complicates any sensible climate policy It is tough to get voters to enact pollution limits on themselves, when those limits benefit them and only them, but it is tougher to get voters to enact pollution limits on themselves if the costs are felt domestically, but the benefits are global = a planetary free riding problem • Impact of climate change is not evenly distributed among regions and countries. Different vulnerability CENTER FOR ENERGY STUDIES I ■■ 1 -^ 2011 World C02 Emissions from Fossil Fuels ■ China CENTER FOR ENERGY STUDIES Change in C02 emissions (GT), 1990 to 2011 -0.652 Other economies in transition -Cell Russia -0.305 EU 15 -0.233 EU new members Japan 0.03 Other OECD 1&90 0.2B International transport 0.3B6 USA | 0.431 ither large developing nations Other developing I" "a "eta 11.2B1 CENTER FOR ENERGY STUDIES Climate change as a public policy problem •Is uniquely long-term • The past decade was the warmest in human history. The one before was the second-warmest. The one before was the third-warmest • Changes are evident. Arctic sea ice has lost half of its mass, three-quaters of this volume in only the past thirty years • But the most of the worst consequences of climate change are still remote, often caged in global, long-term averages. The worst effects are still far off — but avoiding these predictions would entail acting now CENTER FOR ENERGY STUDIES Climate change as a public policy problem •Is uniquely irreversible • Stopping emitting carbon now we still would have decades of warming and centuries of sea-level rise locked in. Full melting of large West Antarctic ice sheets may be unstoppable • Over 2/3 of the excess C02 in the atmosphere that wasn't there when humans started burning fossil fuels will still be present a hundred years from now Over 1/3 will be there in 1000 years CENTER FOR ENERGY STUDIES Climate change as a public policy problem •Is uniquely uncertain. • „Everything we know that we don't know, and perhaps more importantly, what we don't yet know we don't know" (Wagner, Weitzman). • Last time concentration of carbon dioxide were as high as they are today, at 400 ppm, at Pliocene. That was over three million years ago, when average temperatures were around 1-2,5°C warmer than today, sea levels were up to 20 meters higher, and camels lived in Canada. • We wouldn't expect any of these dramatic changes today. The greenhouse effect needs decades to centuries to come into full force, ice sheets need decades to centuries to melt, global sea levels take decades to centuries to adjust accordingly. C02 concentrations may have been at 400 ppm 3 million years ago, whereas rising sea levels lagged decades or centuries behind CENTER FOR ENERGY STUDIES Costs of climate change • Around current climates masive investments and industrial infrastructures is build, that makes temperature increases costly •The current models estimates that warming of 1°C will cost 055% of global GDP, 2°C around 1% GDP, 4°C around 4% GDP • We could think about damages as a percentage of output in any given year. At a 3 percent annual growth rate, global economic output will increase almost twenty-fold in a hudred years • Or lets assume that damages affect output growth rates faster than output levels. Climate change clearly affects labor productivity, esp. in already hot countries. Then the cumulative effects of damages could be much worse over time CENTER FOR ENERGY STUDIES Summary • Climate change is unlike any other public policy problem. It's almost uniquely global, long-term, irreversible, uncertain. These factors are what make climate change so difficult to solve CENTER FOR ENERGY STUDIES International regime to fight climate change • Who is responsible? • Who is affected • Who should act? • What is to be done? CENTER FOR ENERGY STUDIES International regime to fight climate change • Who is responsible? (population growt + increasing consumption) • Who is affected (common but differentiated vulnerabilities) • Who should act? (divergence between the countries most responsible and countries most affected) • What is to be done? CENTER FOR ENERGY STUDIES International regime to fight climate change Intergovernmental Panel on Climate Change — 1988. Rio Summit on Earth — 1992 (UN conference on environment and development) —> UNFCCC Kyoto Protocol 1997, in force 2005 = Existence of a generally accepted consensus on the climate change as well as the contribution of human activities to this change CENTER FOR ENERGY STUDIES Kyoto Protocol (KP) 4 GHG (carbon dioxide, methane, nitrous oxide, sulphur hexafluoride) + hydrofluorocarbons and pefluorocarbons Annex I. countries (37 industriali2ed countries + EU15), Non-annex I. parties Reducing of GHG emissions by 5,2 % for the first commitment period of 2008-2012. (4,2 % after USA left). Base year 1990 Reduction of emissions from fossil fuel combustion; reduction emission in other sectors (land-use or direct industrial emissions); flexible mechanisms — Emission trading, CDM, JI Common but differenciated responsibility CENTER FOR ENERGY STUDIES Kyoto Protocol (KP) In 2012, C02 emissions from fuel combustion across all Parties with KP targets were 14% below 1990 levels Emissions in the EU-15 were 8% bellow 1990 levels Some industrialised countries have seen significant increases (Australia +48%), New Zealand (+44%), Spain (+30%) Despite extensive participation of 192 countries the KP is limited in its potential — U.S. remains outside, developing countries do not have emission targets The KP implies action on less than one-quarter of global C02 emissions Through its flexibility mechanisms the KP has made C02 a tradable commodity, and has been a driver for the development of national emission trading schemes CENTER FOR ENERGY STUDIES 1990 2012 ^change Kyoto 1990 2012 %change Kyoto MtCOj MtCQj 90-12 Targst MtCO, Mtli 90-12 Target KYOTO PARTES 8339.6 7r1573 -14» ■4.6% w OTTER COUNTRIES 12,014.7 23 4374 95.6* WrTH TARGETS 111 Europe 3r,f54.5 2.306.4 -7.9* Nan-parti opab'ng Ajstra 56.4 B47 143% -13% ^nne* 1 Psriies 5,550.9 5,333.9 7.S% Belgium 107.B 104.6 -3.1% -7SI Belarus 124.B 71.1 ■43J0% -£ = = Denn" art 50.6 37.1 36.7% -21% Canada''' 4262 533.7 24j6% -a% Finland 54.4 -;- -9.1% :== Malta : a 2j£ lC4 = = ncne France'^ 352.B 333 .-5 -5.4% :== Turkey 126.8 302.4 1333% ncne Gerrrany 94B.7 7553 3D3% -21% Unite Stales 4 BSfl.7 5374.1 - :== -7% Greece 7D.1 77.5 103% +25% Iceland ■ j IB -23% +10% Other Rsgisns 6,352.7 172.3% ncne keland 30.6 355 163% +13% Wtica 545.0 1332.4 ag.4% ncne Italy 387.4 3743 -5.7% -as* Mdde Eas1 549.B 1J647.1 199.5% ncne Luxembourg 10.4 102 -1.3% -23% N-OECD Eur. A Eurasia ■'■ 630.D =:£.£ -15.1% ncne Nerherlancs 155.E 1733 113% -5% Latin frnerica!q 842.5 1.5333 37jS% ncne Norway 2B.3 3Ö2 273% +1% Asia .exd. China)