Policy Proposals Environment and Energy A proposal for the establishment of a new climate change framework -- from Kyoto to Paris, and toward Future of the Earth --
The international community seeks to reach agreement on a new post-2020 international framework at the twenty-first session of the Conference of the Parties to the United Nations Framework Convention on Climate Change (COP21), which will be held in Paris at the end of this year. In light of COP21, Japan formulated its Intended Nationally Determined Contribution (INDC) regarding climate change countermeasures and submitted it to the UN in July.
The further absence of an international framework on climate change should not be tolerated. There is a strong urge for agreement on a fair and effective international framework with the participation of all major emitters that is compatible with economic growth.
As efforts to reduce greenhouse gas emissions intensely affect economic activity and national life, and require the implementation of measures that entail public burden, countries have maintained an unyielding stance at the negotiation table. The Japanese government should contribute to international negotiations in a way that will enable all countries to reach agreement at COP21, while also pursuing national interests.
After COP21, it will be important that Japan join hands with other countries and persevere in its efforts to ensure that the new international framework is effectively implemented and that national efforts will continue to evolve.
Therefore, Keidanren has formulated the following proposal from the perspective of contributing to the success of COP21 and ensuring that effective measures are advanced at a global level in the long term.
1. Achieve a fair and effective international framework with the participation of all major emitters
(1) Ensure the participation of all major emitters
An effective climate change measure calls for the establishment of a sustainable international framework that achieves a good balance of environment and economic growth. Therefore, it is critical that: 1) targets are set up voluntarily by each country; and 2) finalized National Determined Contributions (NDCs) are open to revision and are not legally-binding.
The Kyoto Protocol, which was adopted in 1997, imposed an emissions cap only upon developed countries in a top-down manner. It was a legally-binding framework for developed countries, which would bear penalties in the event that a target was underachieved, while it failed to obligate developing countries to reduce greenhouse gas emissions. In addition, the withdrawal of the then largest emitter, the U.S., driven by fears of possible economic impacts, largely undermined the significance of the Kyoto Protocol.
It is evident that persistent obsession with the pursuit of rigid and strict rules such as the Kyoto Protocol will make it difficult for countries to reach consensus, and thus greenhouse gas reductions will not be achieved on a global scale. Moreover, given the substantial economic growth of China, India and other emerging economies, greenhouse gas emissions have doubled relative to 1997 levels in developing countries. In order to establish an effective international framework, we must first ensure the participation of all major emitters, including the US, China and India.
Having presented its unyielding stance that it would "not participate in the second commitment period of the Kyoto Protocol unless the U.S. and China were obliged to reduce emissions" on the first day of COP16, which was held in Cancun in 2010, the Japanese government has made a great contribution to international negotiations by taking the initiative in building today's platform for negotiations, which seek to establish a post-Kyoto international framework applicable to all. The government should sit at the negotiation table with a clear will that Japan will only approve and ratify a new international framework with the participation of all major emitters.
(2) Implement an international review that will contribute to enhancing effectiveness and international fairness
In order to gain the participation of all major emitters and enhance the effectiveness and international fairness of global warming measures on a global scale, the new framework should undergo continued review in the UN process. Reviews should not be differentiated among developed, developing and emerging countries and should not only verify the reduction rate or emission reductions relative to a specific baseline year but also be performed from multidimensional and bottom-up perspectives, including emissions per unit GDP, sector-specific energy efficiency levels, the introduction status of best available technologies (BAT) and marginal abatement costs. When the assumptions underpinning the target levels of a country are significantly altered, countries should be allowed to flexibly revise their target, provided that they fulfill their accountability roles.
Furthermore, given possibilities of future technological innovations, long-term emission trajectories towards 2050 or 2100 should not be drawn based on a top-down approach.
Japan determined the emission reduction target included in its INDC by performing bottom-up calculations of potential individual measures based on BAT, etc. By employing this method and knowledge, Japan can provide BAT lists and identify specific measures that could be adopted by a certain country, and therefore proactively contribute to the implementation of effective reviews that would include enhancing efforts to counter climate change at the national level.
Under the Keidanren Voluntary Action Plan on the Environment, which Keidanren launched in 1997, 34 industries representing the industrial and energy conversion sectors were proactively engaged in reduction efforts to achieve the common target of reducing average CO2 emissions during the five-year period between fiscal 2008 and fiscal 2012 to "below fiscal 1990 levels". As a result, participating industries collectively reduced emissions by 12.1% below fiscal 1990 levels, successfully and substantially overachieving the target. Furthermore, in January 2013, Keidanren formulated and announced the Keidanren Commitment to a Low Carbon Society (Phase 1), followed by the Keidanren Commitment to a Low Carbon Society (Phase 2) in April this year, thereby leading the world's business community in such efforts.
The Voluntary Action Plan on the Environment and the Commitment to a Low Carbon Society, both take a "pledge and review" approach under which participants individually set up targets and conduct reviews in order to ensure their effectiveness. "Pledge and review" is the exact description of the international framework that we should seek agreement on at COP21. Japan should contribute to the establishment of the new international framework by communicating its experiences and knowledge to the international community.
(3) Develop an environment that will encourage the diffusion of energy-saving and low-carbon technologies and products
In order to promote reductions on a global scale, it is critical that developing countries with large reduction potential are provided support for their reductions. Furthermore, innovative technological development is essentially important for the ultimate resolution of climate change issues. Although discussions on the new international framework have been focused on domestic reductions, these abovementioned efforts should also receive higher evaluation.
Discussions on funds and technological support should be based on how much a country's economic strength has grown since the early 1990s, instead of whether or not a country was a "developed country" at the time. We should no longer be committed to the rigid conventional categorization of "Annex I countries" and "non-Annex I countries", and should instead divide countries into "supporting countries" and "supported countries" based on whether or not a country is fully competent at present.
Japan's greenhouse gas emissions represented less than 3% of global emissions as of 2010. In its INDC, Japan states that in order to proactively contribute to the resolution of climate change issues, it will not only reduce emissions domestically but also introduce and disseminate its world-class energy-saving and low-carbon technologies, products and knowhow overseas and develop innovative technologies. Japan should utilize the Joint Crediting Mechanism and ODA, the Japan Bank for International Cooperation's export finance and GREEN operations, and the Innovation Plan for Environmental Energy Technology to promote energy-saving and low-carbon products as well as low-carbon technologies, such as high-efficiency coal-fired thermal power plants. In addition to promoting such efforts, it should "visualize" its avoided emissions and proactively communicate to the world the significance of such efforts and negotiate their inclusion as important criteria under the new framework.
Moreover, supporting the transfer of low-carbon technologies to developing countries have significant meaning from the perspective of promoting climate change measures on a global scale, but yet entail challenges including the fact that technologies and products featuring high environmental performance are generally costly and are thus difficult to disseminate in developing countries. Therefore, it is important to involve the Climate Technology Centre and Network (CTCN), which aims to encourage the transfer of climate change countering technologies, and the Green Climate Fund (GCF), which supports emission reductions and adaptation measures in developing countries, and engage them in organic collaboration. Japan should contribute to the effective operation of both mechanisms through provision of the Japanese business community's knowledge regarding low-carbon technologies and monitoring the funds granted.
Furthermore, addressing fluorocarbons with high global warming potential that have not been covered under conventional international frameworks could also produce effective results. We hope that policy will be supportive of Japan contributing to reductions in developing countries by means of our advanced technologies and knowhow for the recovery, destruction and reuse of fluorocarbons.
2. Establish a multi-layered framework for international promotion
The UN framework is extremely important from the perspective that most countries of the world participate in it. However, given that: 1) the UN process engages a large number of participants among which consensus is a requirement, and thus lacks flexibility; 2) the top ten emitters account for more than 65% of the world's greenhouse gas emissions; and 3) only a limited number of countries can lead the development and diffusion of technologies to promote climate change measures; it would be effective to take advantage of various forums outside of the UN framework to promote international efforts to address climate change.
Specific examples would be the G7 summit meeting that Japan will host in the Ise-Shima region next year, G20 meetings, and the Major Economies Forum on Energy and Climate (MEF), which is focused on environmental and energy issues. Innovation for Cool Earth Forum (ICEF), which enjoys the participation of academic and industrial leaders, as well as government representatives, should be used as a forum for the promotion of climate change measure at a global level.
3. Future domestic measures
Once a new international framework is established at COP21, domestic measures are likely to be considered in full. The government should center the business community's efforts on the Commitment to a Low Carbon Society and support measures taken under it.
On the other hand, regulatory methods, such as emissions trading schemes, the Global Warming Tax and the feed-in-tariff scheme for renewable energy, should not be introduced for fear of hindering the development of a vigorous private sector-led socio-economy. Measures that have already been implemented should be fundamentally reviewed, with their abolishment an option.
The Minister of the Environment recently issued a comment that the construction of a coal-fired thermal power plant could not be approved as the electric power industry's action plan under the Commitment to a Low Carbon Society included problems yet to be resolved in terms of environmental impact assessment procedures. This motion may undermine conventional climate change policy, which has promoted effective measures in a way that economic growth could be maintained by harnessing voluntary approaches by the private sector, and be found to be in denial of the concept underlying Japan's INDC. The Environmental Impact Assessment Law is a procedural law that aims to foster communication with local residents in view of potential impacts on air and water quality. Therefore, we request reconsideration of the application of this law upon measures addressing CO2 emissions, which is a global issue.
From the viewpoint of ensuring the promotion of effective measures to reduce domestic CO2 emissions in 2030, Japan should implement the PDCA cycle and follow-ups for each sector and policy measure. Particularly in the household sector, which failed to adequately reduce emissions under the Kyoto Protocol Target Achievement Plan, responsible actors should be explicitly identified and the recently launched public campaign, "COOL CHOICE" should be strongly promoted under the initiative of the Prime Minister. It should be noted that when a particular sector fails to achieve expected results, additional reductions should not be demanded of other sectors.
Keidanren is determined to ensure the continued implementation of the Keidanren Commitment to a Low Carbon Society, and thus engage in efforts to further reduce domestic greenhouse gas emissions and to address global and long-term climate change challenges to the maximum extent possible through the diffusion and development of low-carbon technologies.