Fwd: Japan Says No to Extending Kyoto Protocol, Wants Global Treaty

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Japan Says No to Extending Kyoto Protocol, Wants Global Treaty
2010-12-01 10:21:30.909 GMT

By Alex Morales and Stuart Biggs
Dec. 1 (Bloomberg) -- Japan said it won't help extend the
Kyoto Protocol accord to curb greenhouse-gas emissions after it
expires in 2012, saying that instead a new global agreement is
necessary to combat climate change.
The Kyoto treaty is "outdated" because it only regulates
27 percent of global emissions, Kuni Shimada, special adviser to
Japanese Environment Minister Ryu Matsumoto, said yesterday in
an interview at United Nations climate talks in Cancun, Mexico.
Failing to extend Kyoto through a UN-brokered agreement may
put the organization's $2.7 billion annual market for emissions
credits at risk of collapse. The world's second-biggest
greenhouse-gas market is defined in the Kyoto accord and the
credits are generated to help polluters around the world meet
emissions targets laid down in the 1997 agreement.
"This is the firmest Japan has been," Jake Schmidt,
international climate policy director in Washington at the
Natural Resources Defense Council, said in an interview in
Cancun. "The fate of the Kyoto Protocol is going to cast a
shadow over what we're trying to do here on all the other
building blocks of a climate agreement."
The agreement negotiated in Kyoto, Japan, binds 37
developed nations and the European community to cut emissions
from 1990 levels by a collective 5.2 percent in the five years
through 2012. The U.S. never ratified the treaty, and developing
countries such as China aren't included.
Traders this year have sold UN credits on concern Kyoto may
not be extended beyond 2012.

Credit Spread Widening

Credits for 2012 that were created under the UN program,
called the Clean Development Mechanism and set up after the
Kyoto accord, traded at 4.25 euros ($5.56) less than those in
the European Union's cap-and-trade program as of Nov. 30. That
compares with a 2.39 euro discount at the start of the year.
CDM credit issuance contracted 59 percent last year to
$2.7 billion, according to a World Bank report.
Talks to extend Kyoto's emission targets to the U.S. and
China, the world's biggest emitters, failed at the 2008 UN
climate-protection summit in Poznan, Poland.
In Copenhagen last year, negotiators were hoping to write a
global treaty replacing Kyoto. The talks collapsed over
differences between the U.S. and China over the scale and
monitoring of emissions cuts.
"China and India want to make sure the Kyoto Protocol is
not dead, and you've got Japan and Russia and Canada saying no
chance unless the U.S. and China are onboard," Schmidt said.
The U.S. isn't likely to be able to agree to binding
targets until at least 2013 because it needs to have domestic
legislation in place first, Shimada said.

Depth of Division

"Without the active participation of the two biggest
emitters, namely China and the United States, it's not a global
effort," said Shimada, who was formerly Japan's lead negotiator
at the talks. "Whatever happens, under any kind of conditions
we do not accept a second commitment period."
The comments indicate the depths of divisions that have
prevented a new treaty on climate change. UN officials leading
the current round of talks are aiming for more incremental
progress on protecting forests, channeling funds to poor nations
and on verifying reductions in emissions blamed for damaging the
Earth's atmosphere.
Agreeing to an extension for the Kyoto Protocol is a key
demand by developing countries including China and the 43-nation
Alliance of Small Island States. The 27-nation European Union
has said it's open to a second commitment period, though it also
wants action by the U.S. and China.

Pershing, Japan Slammed

Jonathan Pershing, chief of the U.S. delegation, said
earlier this week that the Obama administration stands by its
commitment to reduce its emissions of heat-trapping gases by 17
percent for the 15 years through 2020. He said President Barack
Obama still thinks legislation is the right approach even after
Congress this year failed to pass a climate change law and
Obama's Democrats lost control of the House of Representatives.
"We think it may be not necessarily be only comprehensive
legislation, but perhaps elements in energy or elements in other
environmental activities that could also move us in that
direction," Pershing said.
Environmental and non-profit groups slammed Japan's refusal
to accept a second commitment period.
"It's shocking that at a time when the whole world is
seeking to strengthen the climate regime, Japan wants to kill
the treaty that bears its name," Mohamed Adow, senior climate
change adviser at Christian Aid, said in an e-mailed statement.
The collapse of the UN-backed CDM carbon offset market
would impact the source of funding for renewable energy projects
in developing countries in Asia, Haruhiko Kuroda, president of
the Asian Development Bank, said at a briefing today in Tokyo.
"The truth is that the carbon trading market has already
been impacted," Kuroda said. If the CDM collapses, "a very
important pillar of the financing mechanism for climate change
mitigation efforts in developing countries is going to be

For Related News and Information:
Top environment and renewable energy stories: GREEN <GO>
Stories about the climate talks: NSE CLIMATE CANCUN <GO>
Locations of global energy facilities: BMAP <GO>

--With assistance by Ben Sills in Madrid. Editors: Peter Langan,
Todd White

To contact the reporters on this story:
Alex Morales in London at +44-20-7330-7718 or
Stuart Biggs in Tokyo at +81-3-3201-3093 or

To contact the editor responsible for this story:
Reed Landberg at +44-20-7330-7862 or landberg@bloomberg.net.