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Kerry-Lieberman and the International Climate Talks

by Michael Levi
May 13, 2010


I’ve got three quick thoughts on what the big Kerry-Lieberman energy and climate bill means for the international negotiations, and they’re not good. (More to come later; I’m on the road.)

1. This bill probably won’t pass. While it lives, U.S. negotiators will have to pretend, however half-heartedly, that they think it’s got a serious chance. An effective strategy for the Cancun climate talks at the end of this year, though, needs to be based on reality, which will probably be that the United States doesn’t have a climate bill, and is hence on the defensive. The net result is great difficulty for the United States to engage seriously until the bill’s fate is clear. That is a recipe for lost time and opportunity.

2. The bill, even if it doesn’t pass, will gut expectations for how much money the United States can contribute to international climate change efforts. Waxman-Markey set aside 5% of allowance value in 2012 to protect forests, 1% for international technology cooperation, and 1% for adaptation assistance. Kerry-Lieberman has the same goals for protecting forests but devotes no money to it; has no money for international technology cooperation; and devotes a very small amount to international adaptation.

[IMPORTANT UPDATE: Section 797 of the bill allows the President to designate up to 5% of allowance value for these sorts of things in the context of a multilateral agreement covering over 67% of global emissions. That’s serious money. One could even argue that, because of its contingent nature, this provides more leverage for the international negotiations. It will be very tough politically to designate that 5%, though, since as the bill is written, every other use of allowance value would need to be cut proportionally (including consumer rebates, etc), which means that the President would need to fight with everyone in sight as he took away their money. It would also make it hard for the United States to engage bilaterally or in smaller groups absent a global agreement. But there is some substantial positive news there.]

The turning point at Copenhagen was when Hillary Clinton announced that the United States would aim to help raise $100 billion a year for international climate assistance, which turned a huge number of poorer developing countries against China. That was by far the biggest incentive for China to agree to the Copenhagen Accord. It will be challenging for the United States to defend that stance this year at Cancun if Kerry-Lieberman is the new normal, which could make it, rather than China, the focus of everyone’s anger. I’m all in favor of injecting reality into international discussions, and Kerry-Lieberman may do that, but it will not be pretty.

3. One of the brightest lights at Copenhagen was progress on efforts to reduce emissions from deforestation. It’s also been one of the main deliverables lots of people have been talking about for the Cancun talks at the end of this year. Waxman-Markey set a goal of conserving forests equivalent to 10% of U.S. emissions – a huge number – and set aside several billion dollars to pay for it. Kerry-Lieberman maintains the goal but without the money. It’s not clear that the Administration will have the confidence to do a “mini-deal” on forests this year if it requires significant amounts of cash.

[UPDATE CONTINUED: Some of the 5% could go to forests, so REDD isn’t completely out of the picture. Still, the caveats above apply.]

There’s also a lot of good stuff in the bill. An efficient U.S. cap on carbon would be tremendous progress. But there are some serious problems here.

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  • Posted by Glenn Hurowitz

    The bill is actually even worse for rainforests than you describe. In a last minute move, bill authors excluded any major private sector investment in rainforest conservation for approximately the next decade.

    Unlike Waxman-Markey and Kerry-Boxer, they’re not allowing rainforest conservation projects to be eligible for carbon credit – unless they’re part of a state, provincial, or national deforestation baseline. Unfortunately, there are likely to be no countries, states, or provinces that will be able to immediately meet the requirements to have a baseline. And, five years after the start of the bill, only national deforestation baselines will be eligible. Unfortunately, there are zero actual states that seem able to meet these requirements.

    It’s estimated that the first state that could cobble together a national baseline – Central Kalimantan in Indonesia, won’t be able to do it for five to seven years. So the door is shut on any near term private financing for forest conservation as well, meaning rainforests will continue to fall. As the source of 15-20 percent of climate pollution (more than all the cars, trucks, ships, and planes in the world combined), this is a major failure.

    Waxman-Markey and Kerry-Boxer had sensible limits on projects without national baselines: eight years for most countries, extendable by an additional five for most others. That means we can get conservation started – and don’t have to see rainforests continue to fall – while we set up the national baselines we need in the long run.

    The bill will also have the effect of shutting off crediting for early actors. Another big problem with this move: it will dramatically and unnecessarily increase the costs of the bill.

    Without the tropical forest pieces, the legislation will be dramatically more expensive than projected. There will be both fewer affordable offsets, and less public funding for forests. Somehow, the bill authors have managed to twist a win-win-win for forests into a lose-lose-lose. I wrote a post in Grist about the cost implications of removing the set aside, drawing on a Resources for the Future study.

    The situation will be even worse without forest conservation projects.

    Ironically, this comes as we’ve dramatically expanded the political support for tropical rainforests, so that supporters now includes U.S. ag and timber producers, in addition to leader companies and environmental groups.

    Senators need to fix these provisions, or they risk leaving one of the most affordable and best methods of reducing pollution on the table – with disastrous consequences for rainforests and the wildlife and people that live in them.

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