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Climate Deal Decades Away as 'Dysfunctional' U.S. Delays Cap
2010-12-13 05:00:01.3 GMT
By Alex Morales, Kim Chipman and Jim Efstathiou Jr.
Dec. 13 (Bloomberg) -- Delegates at the United Nations
climate talks stayed up two nights in a row last week to
agree on a proposal to slow global warming. Next year's
negotiations will likely be even tougher.
The plan gaveled through on Dec. 11 creates a climate
fund to channel as much as $100 billion a year in aid to
developing nations by 2020, protects forests and outlines
methods to verify cuts in fossil fuel emissions. No new
targets for curbing greenhouse gases were set, and debate on
the future of the Kyoto Protocol, which limits emissions by
developed countries until 2012, was put off until the next
meeting in Durban, South Africa, in December 2011.
With President Barack Obama struggling to salvage his
energy agenda and richer and poorer nations in conflict over
extending Kyoto's emission limits, a new worldwide climate
treaty may be 20 years away, said Tim Wirth, who in 1997 led
the U.S. delegation in Kyoto, Japan. Such a delay endangers
the future of $2.7 billion a year in pollution credits sold
under a UN program based on the Kyoto agreement.
"We have a dysfunctional Congress and an administration
without policy," Wirth, a former Democratic senator from
Colorado, said in an interview during two weeks of UN climate
talks in Cancun, Mexico. "The U.S. doesn't have an energy
strategy. You can't sign up to an international treaty unless
you know what you are going to do at home."
A dispute over extending emission cuts beyond 2012 under
the Kyoto plan, which called for a 5.2 percent reduction from
1990 levels among industrial nations, nearly derailed this
year's UN conference.
China vs. Japan
China, India, Brazil and South Africa pressed developed
countries to make bigger cuts. Japan, Russia and Canada all
said they don't want to extend Kyoto unless the two biggest
emitters, China and the U.S., are brought into the pact.
Delegates papered over the rift by keeping alive the
prospect of extending Kyoto while not setting new targets for
polluters. Bolivia was the lone voice among the 193 nations
present objecting to that decision, saying it wasn't
ambitious enough. Bolivia's objection was overridden.
"The collapse of the Kyoto Protocol, particularly with
the U.S. being so many years away from even having a serious
discussion, would really take the wind out of climate change
negotiations," Kevin Conrad, Papua New Guinea's envoy to the
talks, said in an interview.
Obama, who ran for president on a pledge to push for a
U.S. cap-and-trade system to cut emissions and fight climate
change, failed to get legislation through the Senate this
year. Then Republicans -- including those who disagree with
the notion of man-made climate change -- won control of the
House of Representatives and gained seats in the Senate in
Obama now says climate legislation probably can't win
congressional approval until 2013 at the earliest. That means
Kyoto's emission limits will expire before the U.S. sets
legislation to back up its commitments on cutting emissions,
making it unlikely developing countries will pledge cuts of
"The U.S. does have to take a lead because, if the U.S.
sits there and does nothing, then the world will not react,
especially the developing world," Dow Chemical Co. Chief
Executive Officer Andrew Liveris said in an interview in
Cancun, where he joined other CEOs lobbying countries to take
U.S. delegation chief Todd Stern in Cancun reaffirmed
Obama's pledge to cut emissions about 17 percent by 2020, a
promise contingent on having domestic laws to back it up.
Kyoto spurred the development of the world's largest
carbon market, the European Union Emissions Trading System,
and its second biggest, the UN Clean Development Mechanism,
to help companies meet greenhouse gas goals.
The market in credits for carbon dioxide emissions may
decline 3.9 percent to $122 billion dollars this year from
$127 billion last partly because of uncertainty about the
next round of emissions reductions, Bloomberg New Energy
"The reality is the talks will struggle unless and
until the U.S. can bring something more substantial to the
negotiation table," said Mark Lewis, a carbon market analyst
based in Paris for Deutsche Bank AG.
Inertia on stimulating low carbon technology and clean
energy may hobble U.S. companies, said Jennifer Haverkamp,
managing director of international policy at the
Environmental Defense Fund.
"They see that they're falling behind because they
don't have the price signal to innovate and be part of the
economy of the future," she said. "Other countries are
taking serious action. One of these days the Senate is going
to wake up and instead of quaking in their boots being afraid
to go first, they'll realize they're last."
China's 'Warp Speed'
Some executives say China's emergence as a competitive
force should change the mood in Washington and prompt Obama
to act on the environment more quickly. China is gaining an
edge on the U.S. in clean technologies, said Duke Energy Corp.
Chief Executive Officer Jim Rogers.
"What they are doing is leading the world in solar and
wind, they are building 24 nuclear plants," Rogers said in
an interview in Cancun. "They are very much moving in that
direction at warp speed, ahead of the U.S."
China plans to raise installed electricity-generating
capacity to 90 gigawatts of wind power and 5 gigawatts of
solar power by 2015. A nuclear reactor by comparison has a
capacity of about 1.6 gigawatts.
Competition from China's clean energy companies, such as
Yingli Green Energy Holding Co. and Trina Solar Ltd., is
narrowing profit margins for U.S. wind and solar companies
including First Solar Inc. and General Electric Co.'s wind
'Turned on its Head'
"The whole concern about China has been turned on its
head," said Elliot Diringer, vice president for
international strategies at the Pew Center on Global Climate
Change in Arlington, Virginia.
"For years the line was we shouldn't do anything
because China isn't doing anything. Now the worry is that,
'Oh my God: China is getting ahead of us in the clean
technology race. We better catch up.'"
This year's UN talks pledged to keep global temperature
increases to 2 degrees Celsius (3.6 degrees Fahrenheit). The
emissions reductions currently pledged may lead to increases
of 5 degrees by 2100, the UN Environment Program said Nov. 23.
That leaves islanders from nations such as Kiribati in
the south Pacific, northeast of Australia worrying for their
future. Homes already are being washed away, roads eroded and
communities displaced because of rising sea levels linked to
climate change, President Anote Tong said in an interview.
"The negotiating process will carry on for the next few
decades," Tong said. "Do we wait for everything to be
resolved before we implement what's needed? It's going to be
too late for many countries. It's about the survival of
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--With additional assistance from Carlos Manuel Rodriguez and
Mathew Carr in Cancun, Mexico. Editors: Reed Landberg, Peter
Langan, John Viljoen
To contact the reporters on this story:
Alex Morales in Cancun, Mexico, at +44-20-7330-7718 or
Kim Chipman in Cancun, Mexico at +1-202-624-1927 or
Jim Efstathiou Jr. in Cancun, Mexico at +1-212-617-1647 or
To contact the editor responsible for this story:
Reed Landberg in Cancun, Mexico at +44-20-7330-7862 or