The Chinese government has ordered five cities and two provinces to set caps on greenhouse gas emissions in preparation for a series of regional carbon markets.

Last week, China’s National Development and Reform Commission urged Beijing, Tianjin, Shanghai, Chongqing and Shenzhen, as well as the provinces of Hubei and Guangdong, to set “overall emissions control targets” and submit strategy proposals on how to achieve them.

A plan developed by Guangdong — which commits the province to achieving 20 percent of its total energy consumption from non-fossil fuels by 2015 — has already been approved by the central government. The province must also cut its “carbon intensity,” or the CO2 emissions per unit of economic growth, by 19.5 percent.

China as a whole, which has already passed the U.S. as the world’s biggest greenhouse gas emitter, has committed to reducing its carbon intensity by 40 to 45 percent by 2020. According to a new government report, China’s urban population surpassed its rural population for the first time ever in 2011.

Article appearing courtesy Yale Environment 360.

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Forests play an even greater role in Earth’s climate system than previously known, according to the most comprehensive assessment yet of the carbon storage potential of the world’s wooded areas.

Between 1990 and 2007, the planet’s tropical, temperate, and boreal forests absorbed about 2.4 billion tons of carbon annually, or the equivalent of about one-third of fossil fuel emissions, and re-growth of trees in previously cleared lands absorbed an additional 1.6 billion tons, according to a study published in the journal Science.

During the same period, however, rampant deforestation — particularly in the world’s tropical regions — released 2.9 billion tons of carbon annually.

Overall, the planet’s forests provide a net carbon sink of about 1.1 billion tons of carbon, or the equivalent of about 13 percent of the emissions produced by humankind annually.

According to researchers, the findings suggest that forest protection should play an even more important role in strategies to protect the planet’s climate, including the emergence of carbon markets.

“The amount of savings which are up for grabs is very large, certainly larger than what we thought,” said Josep Canadell, an Australian scientist and co-author of the study.

Article appearing courtesy Yale Environment 360.

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At a time when many are adopting the narrative that carbon markets are faltering, the European Union (EU) is aggressively pursuing the expansion of theirs to include aviation. One of only two mandatory greenhouse gas (GHG) cap-and-trade systems in the world, the EU Emissions Trading Scheme (ETS) plans to fold in a new sector beginning in January 2012. Our research shows reducing GHG emissions from aviation is critical if we are to mitigate the impacts of global climate change. Low-carbon fuel technology and other technologies for airplanes are advancing at a rapid clip, but we need a climate policy – either a price on carbon or something else – to get over the hump.

Although there are many opportunities to reduce aviation’s impact on global climate change available now, experts expect GHG emissions from aviation to grow by up to 300 percent by 2050 if left unchecked. Action in the areas of advanced biofuels, airplane navigation and landing systems, and engine and airframe efficiency could help considerably. However, because of market failures, many new technologies may not succeed without public policy.

The point of market-oriented regulations like the EU ETS is to help push that new technology into the market without deciding technological winners. That appears to be exactly what’s happening with aviation in Europe. Low-carbon fuel technology along with more advanced engine and aircraft designs are beginning to enter the market just as new regulations are about to take effect. For example, European airlines including KLM and Lufthansa are beginning to fuel some of their planes with advanced biofuel-petroleum blends.

The EU’s view is that equally pricing the carbon emitted from airplanes flying into and out of European airports is fair and reasonable. And to that end, countries like the United States and China could look at this as one more additional cost to doing business in Europe and support the plan. They don’t. Their concerns include the legality of the program, the fairness of European-specific action, and the economic impact on the aviation industry.

The EU deserves credit for being a first-mover on this issue.

Both countries claim the move is illegal and an act of “extraterritorial jurisdiction” or ETJ. ETJ is an arcane legal term that essentially means a country is trying to exercise authority beyond its borders. U.S. airlines filed a lawsuit in 2009 with the European Court of Justice challenging the legality of the EU plan. The airlines are also concerned that their tight profit margins will be squeezed further, which could lead to even more fees. The International Air Transport Association estimated the program would increase the annual cost to Europe’s airline industry by 1 billion Euros while their profit for 2011 is expected to be less than half that. It’s unclear how much of the additional cost could be passed on to consumers.

Though the U.S. government is not a party in the case, it also believes the program violates international treaties. The U.S. government has officially come out against including U.S. airlines in the EU plan saying the intentions are good, but the method is wrong. Since aviation is a global industry and climate change is a worldwide problem, the US argued it’s sensible to want an international agreement instead of a patchwork solution that may be unfair. The International Civil Aviation Organization (ICAO) has been working on such an agreement for many years.

Meanwhile, China is taking a retaliatory approach by putting the brakes on a major deal with Airbus, blaming the current “political environment.” Using a $4 billion deal as a bargaining chip is certainly an aggressive move by the Chinese. China also makes the claim that the EU program is illegal.

If the EU plan is legally upheld, the U.S. and China could meet its requirements if domestic measures are taken that result in equivalent GHG emission reductions. The purchase of fuel-efficient planes like Boeing’s 787 Dreamliner could reduce emissions and save airlines money in the long run. In addition, biofuels and other alternative fuels can act as a hedge against unstable oil prices, which have seen significant volatility in the last decade. In fact, seven U.S. airlines intend to start fueling some U.S.-based flights with biofuels. Finally, the U.S. military is leading the way in establishing a market for biofuels in aviation.

There are lots of reasons to want more low-carbon fuels and fuel-efficient technologies in the aviation marketplace. Along with hedging against oil price volatility and improving national security, mitigating global climate change is an important co-benefit of efforts to move off oil. Climate policy is a necessary step to help drive technological innovation and address these problems head on. The EU deserves credit for being a first-mover on this issue.

Article by Nick Nigro, a Solutions Fellow at the Pew Center on Global Climate Change. He is responsible for research, analysis, and communication of transportation technology and policy solutions for reducing greenhouse gases.

Article appearing courtesy Txchnologist.

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(Reuters) – EDF Trading, subsidiary of French utility EDF, said on Thursday it has ended its involvement in a biogas project in Honduras which an environmental group claims is linked to human rights abuses.

“We have taken the situation in Honduras very seriously and have spent the past few months looking at our options in respect to our withdrawal,” said John Rittenhouse, chief executive of EDF Trading, in a statement.

“We have therefore issued our notification of termination to the seller and will no longer be involved in this project,” he said.

The Aguan biogas project in Honduras is applying for registration under the United Nations’ Clean Development Mechanism (CDM), which rewards firms for investing in emissions-cutting schemes in developing countries.

Environmental watchdog group CDM Watch claims the project, which is being developed by Grupo Dinant subsidiary Exportadora del Atlantico, is linked to human rights violations including the killing of more than 20 peasants in the past year who were occupying the land.

German Rodriguez, named in a U.N. project design document as a contact at Exportadora del Atlantico, told Point Carbon News that he did not “agree with the findings of the report.”

This week, the Carbon Markets Investors Association said, should any human rights abuse be proven, all companies involved in the project should terminate their commercial relationship with it.

CDM consultants Perspectives was a project participant but terminated its involvement in the project in January.

The German Investment and Development Bank had pledged a loan of more than $20 million to the project but canceled its contractual commitments on April 8, CDM Watch said.

The CDM’s executive board, is likely discussing the project at its meeting in Bangkok, which draws to a close on Friday.

Article by Nina Chestney, appearing courtesy Reuters.

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(Reuters) – Bolivia, among the strongest opponents of the Copenhagen climate accord last year, assailed rich nations at Cancun climate talks on Tuesday but stopped short of threatening to disrupt the two-week conference.

Pablo Solon, the Andean country’s ambassador to the United Nations, told reporters he was “deeply concerned” by the early course of the November 29 to December 10 talks at the Mexican resort of Cancun and criticized plans for carbon markets.

“Here we are negotiating a law without first obeying it,” he said, accusing rich countries of failing to live up to their obligations under the Kyoto Protocol to cut greenhouse gas emissions.

Bolivia has long had the toughest demands of any developing nation for cuts in greenhouse gas emissions, saying tough action is needed to protect “Mother Earth.” It wants to limit a rise in world temperatures to 1.8 degrees Fahrenheit (1 degree Celsius), half the level in the non-binding 2009 Copenhagen Accord.

Bolivia and a handful of other developing nations led opposition to the Copenhagen Accord last year.

Expectations for the Cancun talks have been dampened because there is little sign of compromise between delegates representing nearly 200 countries over many of the issues that led to deadlock and acrimony last year in Copenhagen.

Environmental activists echoed Solon in their criticism of the wealthier nations at the talks and urged governments to start making positive contributions.

Solon deflected questions about whether Bolivia would lead an opposition to a binding agreement at Cancun, saying the rich countries were those blocking progress on talks.

Host Mexico has focused its efforts on jump-starting the talks with an eye to restoring faith in the multilateral system for tackling climate change and making incremental progress on some easier issues.

However Solon condemned proposals known as REDD+ that would set up a market-based system to pay poorer nations to protect tropical forests.

“Now they want to put a value on nature … this is what got us here in the first place,” Solon said.

Bolivian President Evo Morales has fingered capitalism as the root of many of the problems facing the world and has urged his fellow leaders to explore alternatives, such as a declaration of rights for the earth as a means of tackling climate change.

Morales is expected to come to Cancun toward the end of the meeting along with a handful of other world leaders.

Article by Robert Campbell, edited by Mohammad Zargham, appearing courtesy Reuters.

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The European Commission said on Monday a proposal to limit the use of some carbon credits from industrial gas projects in its emissions trading scheme might be unveiled during a United Nations climate summit in Mexico next week. The European Union Emissions Trading Scheme is the largest multi-national emissions trading scheme in the world. The trading scheme currently covers more than 10,000 installations with a net heat excess of 20 MW in the energy and industrial sectors which are collectively responsible for close to half of the EU’s emissions of CO2 and 40% of its total greenhouse gas emissions.

Under the Trading scheme, large emitters of carbon dioxide within the EU must monitor and annually report their CO2 emissions, and they are obliged every year to return an amount of emission allowances to the government that is equivalent to their CO2 emissions in that year. In order to neutralize annual irregularities in CO2-emission levels that may occur due to extreme weather events (such as harsh winters or very hot summers), emission credits for any plant operator subject to the Trading Scheme are given out for a sequence of several years at once. Each such sequence of years is called a Trading Period. The 1st Trading Scheme Trading Period expired in December 2007. Since January 2008, the 2nd Trading Period is under way which will last until December 2012.

The carbon market is looking for clarity over the use of U.N.-backed carbon credits from some controversial projects which destroy the potent greenhouse gas hydrofluorocarbon-23 (HFC-23).

A U.N. panel is scrutinizing such projects over fears that some project developers were adjusting their plants to produce more of the gas and then destroying it to climate profitable carbon credits.

The EU Commission is discussing whether to propose curbs or a ban from 2013 on such offsets in its carbon trading scheme.
The European Commission was due this month to propose curbs or a ban from 2013 on the use of offsets from industrial gas projects in the European Union trading scheme. It wants to stop exploitation of the system by project developers, in countries including China and India, who are suspected of adjusting facilities to produce more of potent greenhouse gas hydrofluorocarbon-23 (HFC-23) and then destroying it to claim profitable carbon offsets.

HFC-23 is a waste by-product from manufacturing refrigerants.

In January 2008, the European Commission proposed a number of changes to the scheme, including centralized allocation by an EU authority, a turn to auctioning a greater share (60+ %) of permits rather than allocating freely, and inclusion of other greenhouse gases, such as nitrous oxide and perfluorocarbons. These changes are still in a draft stage; the mentioned amendments are only likely to become effective from January 2013 onwards. Also, the proposed caps for the 3rd Trading Period foresee an overall reduction of greenhouse gases for the sector of 21% in 2020 compared to 2005 emissions.

Article by Andy Soos, appearing courtesy Environmental News Network.

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(Reuters) – The U.N. climate change chief urged governments on Monday to make real steps toward a new treaty to fight global warming or risk throwing negotiations into doubt.

Negotiators are meeting in the northern Chinese port city of Tianjin to try reach agreement on what should follow the current phase of the Kyoto Protocol, the key treaty on climate change, which expires in 2012.

The fraught U.N. talks have been hobbled by lack of trust between rich and poor nations over climate funds, demand for more transparency over emissions cut pledges and anger over the size of cuts offered by rich nations.

Delaying agreement would leave less time for the world to figure out how to rein in greenhouse gas emissions and would add to uncertainties weighing on companies unsure where climate policy and carbon markets are headed after 2012.

“Now is the time to accelerate the search for common ground,” Christiana Figueres, Executive Secretary of the United Nations Framework Convention on Climate Change, told hundreds of delegates from some 177 countries at the opening session of the Tianjin talks, which last until Saturday.

“A concrete outcome in Cancun is crucially needed to restore the faith and ability of parties to take the process forward, to prevent multilateralism from being perceived as a never-ending road,” she said in an opening speech at the meeting.

The talks are the last major round before the year’s main climate meeting in the Mexican resort of Cancun from November 29.

Negotiators from nearly 200 governments failed to agree last year on a new legally binding climate pact. A meeting in Copenhagen in late 2009 ended in bitter sniping between rich and developing countries, and produced a non-binding accord that left many key issues unsettled.

Governments are struggling to overcome lingering distrust and turn sprawling draft treaties dotted with caveats into a binding agreement, possibly by late 2011.

“This week is to some extent going to be an indicator of how far forward we can go,” the U.S. negotiator at the Tianjin talks, Jonathan Pershing, told Reuters.

“It now looks like the differences are quite large, but there’s some hope of achieving consensus on some issues,” the chief Chinese climate negotiator, Xie Zhenhua, told reporters.

DROUGHTS AND FLOODS

Recent devastating floods in Pakistan and severe drought in Russia are the kind of severe weather that rising temperatures are likely to magnify if countries fail to make dramatic cuts to greenhouse gas emissions, said Wendel Trio, the climate policy coordinator for Greenpeace.

Figueres told Reuters in a separate interview that she hoped the Tianjin talks could agree on important specifics of a future pact, including how to manage adaptation funds and green technology to help poorer countries, and a program to support carbon-absorbing forests in Brazil, Indonesia and elsewhere.

“I think there’s a pretty good chance that the governments will agree on the creation of the (climate) fund,” she said.

Governments have said the fund could disperse up to $100 billion a year by 2020 to help poor countries cope with global warming. But negotiators have been wrestling over how to manage the money and the fund’s design.

Developing countries want a more direct say, while the United States and other countries that would provide the funding want more vetting.

“When you’re thinking about that scale of finance…we want to think about people who have expertise,” said Pershing, the U.S. negotiator. “There’s clearly a need to bring in guidance.”

He said that could come from ensuring countries’ finance ministries and other economic agencies help oversee spending.

Even if the negotiations make progress, the current pledges of governments to curb greenhouse gas emissions will not be enough to avoid pushing the world into dangerous global warming, roughly defined as a rise of 2 degrees Celsius (3.6 F) above average pre-industrial temperatures, said Figueres.

Governments should nonetheless focus on securing formal pledges of the emissions cuts already made, “fully realizing it is a first, necessary but insufficient step,” she said.

Article by Chris Buckley, edited by David Fogarty, appearing courtesy Reuters.

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“No doubts remain. Climate change is real and the build-up of greenhouse gases in our atmosphere is increasingly at an alarming rate.” With these words, Rafael Quiroga, General Manager of Accion RSE, initiated the seminar “Corporate Strategic Management of Climate Change and Greenhouse Gas (GHG) Emissions.” This is not another “green business” seminar from a European or North American city, it took place here — in Santiago, Chile.

The event brought together speakers from the Chilean private sector that gave concrete examples of their companies’ climate change and GHG management initiatives. First, it showed how Essbio, a water purification company, has been dealing with the ever-prescient and escalating challenges of decreasing water reserves due to climate change.  Second, it illustrated the emissions and energy reductions Xstrata Copper, a mining company, has committed to and the steps it has taken to minimize the release of contaminants in its industrial processes. Third, it explained what Natura cosmetics has done since 2007 to become a “carbon neutral” business by calculating all GHG emissions in the company’s supply chain, transportation, and production of its various cosmetics products, and purchasing the equivalent amount of CO2 tonnage in carbon credits on the international carbon markets.

Although Chile is officially considered an Annex B, “developing” country under the dual classification of the Kyoto Protocol, the smaller country of 16 million inhabitants has been no stranger to addressing the climate change issue in recent years. In addition to private companies’ activities noted above, Chile has also completed some 40 projects via the Kyoto Protocol’s CDM market since 2004. These 40 projects have ranged from landfill methane gas capture, to a nationwide energy efficiency CFL lightbulbs installation project, to agricultural methane capture, and to a wind energy project – yielding a total of US$300 million in traded carbon credits for Chilean enterprises.

Moreover, in early December 2008, President Bachelet, alongside her Environment Minister, unveiled Chile’s official “National Climate Change Action Plan” for 2008-2012. The plan includes activities for

1) studying impacts and vulnerabilities,
2) funding adaptation measures, and
3) strong support for mitigation endeavors, including the creation of a Center for Renewable Energy, establishing an increase of funds for a national energy efficiency program, further studies into harvesting biofuels, and increasing bicycle lanes for transport.

Although, historically, Chile has not contributed much to the total build-up of greenhouse gases in the atmosphere – actually 0.2% of total global GHG emissions for the last year tallied, 2004 – the country would like to see itself as a Latin American forerunner on confronting the issue.  President Bachelet’s new Action Plan not only concretely addresses the country’s increasing climate change concerns, but also demonstrates to the international community that Chile, too, is progressive and environmentally conscientious.

However, even with the formidable growth in the renewable energy sector, and a bit less so in CSR and ‘green business strategy,’ in Chile over the past 3-4 years, there is still an internal conflict and complexity as to how the “green” the country is truly progressing. As Mr. Quiroga pointed out at the seminar, Chile’s growth rate of GHG emissions in the past 10 years has been among the highest on the planet, alongside that of China and India. The main culprits for this have been

1) the booming energy intensive mining sector,
2) an increase in automobile use with economic growth, and,
3) an increased reliance on coal in recent years with disruptions in imported gas supplies from Argentina.

One recent study from the University of Chile actually found that Chile’s national GHG footprint is projected to jump 4.2 times its current amount by 2030.  This conclusion assumes the country continues on its current pace and manner of economic development, and with the increased reliance on new coal plants that are currently in different stages of construction.

So, yes, not only are the effects of climate change real in Chile but so too is a growing movement and public consciousness to reduce people’s and companies’ carbon footprints. In addition to Essbio, Xstrata, and Natura, there are other enterprises in Chile making efforts to reduce GHG emissions in their industrial processes or take action in other local environmental issues.  Yet, it is safe to say that such “climate change conscious” companies are still a small minority here in Chile.  And, even though President Bachelet and the Minister of Energy are making genuine, good-faith efforts to bring the latest solar and geothermal energy technology to Chile such as with partnerships with California and the US Department of Energy, the situation of increasing national GHG emissions reveals a deeper complexity we all need to address:

How can a middle-income economy, such as Chile, afford the latest in clean and renewable energy technology to reduce its climate change footprint, while at the same time, continuing to address more pressing needs of economic and social development?

In other words, a country such as Chile still needs to put its food on the table by mining the copper, whether imported gas or a cheaper “clean” energy solution is currently available; and, if they are not available, a bunch of coal will certainly do.

[photo credit: Cheo!]

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