7.4 International agreements and policies on climate change

Climate change is a global challenge requiring international cooperation. The evolution of climate agreements, from the UNFCCC to the Paris Agreement, shows growing recognition of the issue's urgency. These accords set emission reduction targets and establish frameworks for global action.

Implementing climate policies faces numerous challenges. Balancing responsibilities between developed and developing nations, addressing technological and economic hurdles, and integrating climate action with development goals are key issues. National and sub-national governments play crucial roles in translating global commitments into local action.

Evolution of Climate Agreements

Early Climate Agreements and Protocols

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• United Nations Framework Convention on Climate Change (UNFCCC) adopted in 1992 established foundation for international cooperation on climate change mitigation and adaptation
  • Set stage for future agreements
  • Recognized need for global action on climate change
• Kyoto Protocol adopted in 1997 and entered into force in 2005 marked first binding emission reduction targets
  • Focused on developed countries
  • Introduced flexible mechanisms (emissions trading, Clean Development Mechanism)
  • Set specific targets (reduce emissions by 5% below 1990 levels)
• Copenhagen Accord of 2009 shifted towards bottom-up approach
  • Countries pledged voluntary emission reductions
  • Introduced financial commitments from developed nations
  • Failed to produce legally binding agreement

Paris Agreement and Beyond

• Paris Agreement adopted in 2015 represents landmark global accord
  • Goal to limit global temperature increase to well below 2°C above pre-industrial levels
  • Pursue efforts to limit temperature increase to 1.5°C
  • Introduced Nationally Determined Contributions (NDCs) for countries to set climate targets
• NDCs serve as mechanism for countries to establish climate goals
  • Subject to regular review (every 5 years)
  • Designed to increase ambition over time
  • Allow for country-specific approaches
• Subsequent Conferences of the Parties (COPs) focus on Paris Agreement implementation
  • Development of rulebook for transparency and accountability
  • COP26 in Glasgow finalized Paris Agreement rulebook
  • COP27 in Sharm el-Sheikh established loss and damage fund

Challenges of Global Climate Policy

Balancing Responsibilities and Capabilities

• Common but differentiated responsibilities and respective capabilities (CBDR-RC) principle presents challenges
  • Balancing needs of developed and developing countries
  • Addressing historical emissions versus current economic realities
  • Ensuring equitable burden-sharing in climate action
• Climate finance poses significant challenges in global policy implementation
  • Mobilizing sufficient funds (goal of $100 billion annually)
  • Ensuring equitable distribution of funds
  • Tracking effectiveness of financial support
  • Balancing adaptation and mitigation funding

Technological and Economic Challenges

• Technology transfer and capacity building crucial for enhancing global climate action
  • Challenges related to intellectual property rights
  • Differing levels of technological readiness among countries
  • Need for context-specific solutions
• Carbon leakage threatens effectiveness of national and regional climate policies
  • Emissions-intensive industries relocating to countries with less stringent regulations
  • Potential to undermine global emission reduction efforts
  • Addressing through border carbon adjustments

Integrating Climate Action with Development

• Opportunity to integrate climate action with sustainable development goals
  • Co-benefits in health (reduced air pollution)
  • Energy security improvements (renewable energy adoption)
  • Economic growth potential (green jobs, innovation)
• Addressing loss and damage from climate impacts remains contentious issue
  • Particularly important for vulnerable countries (small island states)
  • Debates over compensation and liability
  • Establishment of Santiago Network for technical assistance
• COVID-19 pandemic presented both challenges and opportunities for climate action
  • Temporary emissions reductions during lockdowns
  • Highlighted need for resilient, sustainable recovery strategies
  • Opportunity for green stimulus packages

National Climate Action

Role of National Governments

• National governments set overarching climate policies, targets, and regulatory frameworks
  • Align with international commitments (Paris Agreement)
  • Develop long-term strategies (net-zero targets)
  • Implement economy-wide measures (carbon pricing)
• Responsible for representing countries in international climate negotiations
  • Participate in UNFCCC processes
  • Negotiate on behalf of national interests
  • Translate global commitments into domestic action
• Climate federalism describes dynamic relationship between national and sub-national governments
  • Potential conflicts (overlapping jurisdictions)
  • Synergies (coordinated action across levels)
  • Examples of federal climate policies (US Clean Power Plan)

Sub-national Government Initiatives

• Sub-national governments often have significant autonomy in implementing climate policies
  • Act as laboratories for innovative approaches
  • California's cap-and-trade program
  • German states' renewable energy targets
• Jurisdiction over key sectors for climate action
  • Transportation (electric vehicle incentives)
  • Land use (urban planning for sustainability)
  • Building codes (energy efficiency standards)
• Crucial role in climate adaptation
  • Often at forefront of managing climate impacts
  • Implementing local resilience measures (flood protection)
  • Engaging communities in adaptation planning

Multilevel Governance Approach

• Vertical integration and coordination between different levels of government
  • Aligning national and local climate strategies
  • Sharing best practices and resources
  • Examples of successful multilevel governance (European Covenant of Mayors)
• Importance of horizontal collaboration
  • Networks of cities and regions (C40 Cities)
  • Sharing knowledge and resources
  • Amplifying sub-national voices in global climate discussions

Effectiveness of Emissions Trading

Principles and Major Systems

• Emissions trading schemes (ETS) operate on cap-and-trade principle
  • Limit set on total emissions
  • Allowances traded among participants
  • Creates market incentive for emission reductions
• European Union Emissions Trading System (EU ETS) largest carbon market globally
  • Covers ~45% of EU's greenhouse gas emissions
  • Demonstrated potential for significant emissions reductions in covered sectors
  • Achieved 35% reduction in emissions from covered sectors between 2005-2019

Factors Influencing ETS Effectiveness

• Stringency of the cap impacts effectiveness
  • Tighter cap increases incentive for emission reductions
  • Example: EU ETS cap declining by 2.2% annually from 2021
• Method of allowance allocation affects market dynamics
  • Free allocation vs. auctioning
  • Transition from free allocation to auctioning in EU ETS
• Price stability mechanisms important for market confidence
  • Market Stability Reserve in EU ETS
  • Price floors and ceilings in some systems (California-Quebec)

Challenges and Opportunities

• Addressing carbon leakage crucial for maintaining effectiveness
  • EU proposing Carbon Border Adjustment Mechanism
  • California's use of output-based allocation for certain industries
• Ensuring market liquidity challenges some systems
  • Sufficient number of participants needed
  • Regular trading activity required
• Linking different ETS across jurisdictions can increase efficiency
  • California-Quebec carbon market example
  • Potential for future international linkages
• Effectiveness enhanced when combined with complementary policies
  • Renewable energy standards (Germany's Renewable Energy Act)
  • Energy efficiency programs (Japan's Top Runner Program)
  • Research and development support for low-carbon technologies