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The Montreal Conference
on Climate Change:
A Brief Summary |
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Ancha
Srinivasan, Tomonori Sudo, Rie Watanabe, Kentaro Tamura,
and Hitomi Kimura
Climate Policy Project, Institute for Global Environmental
Strategies (IGES)
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The eleventh session of the Conference
of the Parties to the United Nations Framework Convention
on Climate Change (COP11) and the first session of the
Conference of the Parties serving as the Meeting of
the Parties to the Kyoto Protocol (COP/MOP1) were held
in Montreal, Canada, from 28 November to 9 December
2005 with the aim of meeting three challenges - Implementation,
Improvement and Innovation - set out by Mr.
Stephen Dion, the COP11 President and Minister for Environment
of Canada. The "implementation" referred to
the adoption of the Marrakesh accords for making the
Kyoto Protocol operational, the "improvement"
was targeted to build up both the Convention and the
Protocol in the near term, and the "innovation"
challenge referred to the start of a substantive process
on actions to be taken beyond 2012, when the first commitment
period of the Kyoto Protocol expires.
The Montreal Conference, which
was the most well attended COP to date with nearly 10,000
participants, achieved more than the global community
could hope for with respect to the above three challenges,
perhaps because of not only the extensive preparations
by Canada in holding more than 25 pre-conference consultations
with key countries but also due to growing public attention
to the issue of climate change in 2005 - an eventful
year for international climate policy marked by the
entry into force of the Kyoto Protocol in February,
the organization of G8 Summit in July focusing on climate
change, and the launch of the Asia-Pacific Partnership
on Clean Development and Climate focusing on technologies.
However, much remains to be done in the future if we
are to comprehensively address the challenge of global
climate change. The objective of this briefing is to
summarize major decisions taken in Montreal on various
topics and identify future challenges for the COP12
and beyond.
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1. Clean Development Mechanism (CDM) and other market-based
instruments
Decisions:
The COP/MOP1 took a historic step in adopting 21 decisions
based on the Marrakech accords thereby breathing life
into implementation of the Kyoto Mechanisms. The registration
deadline for CDM projects hoping to derive CERs from activities
initiated between 1 January 2000 and 18 November 2004
was extended to 31 December 2006. Further, the Parties
pledged to deliver about USD 8.2 million to bridge the
financing gap of the CDM Executive Board (EB). The share
of CDM proceeds for administrative expenses of EB was
set as USD 0.1 for the first 15,000 CERs issued to a project
per calendar year and USD 0.2 for the remaining amount.
In addition, CDM EB is requested to collect public opinion
on 'additionality'.
Perhaps the most important decision on CDM is agreement
that project activities under a "programme of activities"
can be registered as a single CDM project provided that
approved baseline and monitoring methodologies are used
that defined the appropriate boundary, avoid double-counting
and account for leakage, but a local/regional/national
policy or standard cannot be considered as a clean development
mechanism project activity. Bundling of several large-scale
activities at multiple sites into one project was also
agreed.
A governing body for the Joint Implementation called JI
Supervisory Committee was established. Designated Operational
Entities under the CDM may provisionally and conditionally
act as accredited independent entities under JI for evaluating
the 2nd track projects. JI Project proponents can use
CDM methodologies and elements from CDM Project Design
documents until JI procedures are in place.
The decision on the International Transaction Log (ITL)
adopted the design requirements for the technical standards
for data exchange between registry systems, and requested
the ITL administrator to implement the ITL in 2006 with
a view to allowing registry systems to successfully connect
to the ITL by April 2007.
Challenges:
Although
27 items for the CDM reform were tabled during COP11 negotiations,
only a few decisions have been concluded. Issues to be
resolved in future include: whether carbon capture and
storage (CCS) projects should be eligible for the CDM,
whether new projects focusing solely on destruction of
HFC-23 should be excluded from CDM; and how to treat "additionality"
of the proposed projects, and how to achieve a more equitable
geographical distribution of projects.
The
most critical issue for the project developers is whether
CERs generated by the CDM projects will have value after
the first commitment period. It can only be determined
if post-2012 negotiations move forward.
2. Adaptation to climate change
Decisions:
The
COP11 adopted a five-year work programme on adaptation,
which will be conducted primarily through workshops, expert
groups, and technical papers. The programme's scope contains
two thematic areas (vulnerability and impacts; adaptation
planning, measures and actions) and two crosscutting issues
(methodologies, data and modelling; integration into sustainable
development). The first thematic area is aimed at assisting
Parties to improve their understanding of vulnerability,
impacts, and adaptation through improved vulnerability
assessment tools, climate monitoring and projections,
and understanding of variability and extreme events. The
second theme is aimed at assisting Parties to make informed
decisions on practical actions and measures against climate
change and variability through promoting analysis and
sharing of adaptation measures, research on adaptation
technologies, and development of economic diversification
strategies.
The
COP/MOP1 adopted initial guidance for the Adaptation Fund
(which is a share of 2% proceeds of the CDM projects)
and agreed on a one-year process to decide on modalities
of its operation including governance and procedural issues
such as eligibility criteria, cost-effectiveness and co-financing.
A workshop will be held in spring 2006 to consider those
issues and to adopt further guidance at its next session.
Challenges:
The
governance issue of the adaptation fund must be resolved
soon. Developing countries argued that the GEF's management
arrangements reflect its donor bias and therefore are
not appropriate for a fund financed through the CDM proceeds.
Securing more funds to address adaptation, especially
in the least developed countries (LDCs) and small island
developing states (SIDS) remains crucial. Some Parties
view the necessity to bring mandatory contribution to
funds related to adaptation instead of voluntary contribution
(present practice), and to widen the funding base for
adaptation through introducing levy on the other Kyoto
mechanisms such as JI and Emissions Trading..
3. Compliance issues of the Kyoto
Protocol
Decisions:
The Montreal conference discussed two issues on compliance
under the Kyoto Protocol - the agreement on the adoption
of procedures, and its legal nature. Saudi Arabia had
proposed that the decision on compliance regime should
be implemented as an amendment to the Protocol rather
than by a MOP decision. In contact groups and informal
consultations, four different groups were observed. The
first group - OPEC countries including Saudi Arabia -
sought to agree on legally binding procedures and mechanisms
and adopt them as an amendment at COP/MOP1. The second
group including the most of non-Annex I Parties sought
to adopt it as the COP/MOP1 decision with a condition
to agree on the amendment at the next session in order
for the amended protocol to come into force by the end
of the first commitment period. The third group including
the most of Annex I Parties sought to launch the discussion
on amendment with a condition to adopt it by the COP/MOP1
decision. Japan belonged to the fourth group and sought
to adopt it by the COP/MOP decision without launching
the discussion on amendment, arguing that compliance can
be attained only through facilitative measures rather
than penalties. At the end, the Parties agreed on (a)
"approving and adopting" procedures and mechanisms
relating to compliance under the Kyoto Protocol annex
to Decision 24/CP7 and (b) launching discussions on the
amendment in May 2006 with a view to making a decision
at COP/MOP3. The compliance committee with its facilitative
and enforcement branches was elected.
Thus the adoption of the procedures and mechanisms relating
to compliance under the Kyoto Protocol and the establishment
of compliance committee without delay is one of major
achievements at the COP/MOP1 and ensures "implementation"
of the Kyoto Protocol.
Challenges:
The COP/MOP1 could not reach the agreement on the legal
nature of the procedures and mechanisms relating to compliance
under the Kyoto Protocol. For discussions on the legal
nature, the following issues should be considered. Firstly,
the double regime issue. It is quite likely that some
Parties would not ratify the amendment even if it is agreed.
Therefore there will be two different compliance regimes
if the amendment is adopted. Secondly, the effectiveness
of compliance regime must be looked into. While some Parties
argue that compliance will be enhanced by facilitation
rather than penalty, others argue that legally binding
procedures and mechanisms are necessary to ensure the
Parties to achieve the Kyoto target. An intensive discussion
on this point is necessary. Thirdly, the impact on future
participants. Currently most of Non-Annex I Parties show
their preference to legally binding compliance procedures
and mechanisms. Once the legal nature of compliance procedure
is decided, however, it would be difficult to change it
after the expansion of Parties with commitments. Parties
are required to discuss and reach an agreement on all
these issues by the COP/MoP3.
4. Funding for Developing Countries
Decisions:
COP11 decided that the LDC Fund should support the implementation
of urgent activities identified in National Adaptation
Programmes of Action (NAPAs), and that it should provide
full-cost funding to meet the additional costs involved.
Given the limited amount of funds, GEF was asked to (a)
develop co-financing to support these activities and flexible
modalities that ensure balanced access to resources and
(b) separate the administration and activities of GEF
Trust Fund and the LDC Fund.
GEF was asked to include in its regular report to the
COP information on the initial application of the Resource
Allocation Framework to resources allocated in the fourth
replenishment, and its effect on funding available to
developing countries. It was also asked to assist Parties
not included in Annex 1, and consider whether supporting
CCS technologies would be consistent with their strategies
and objectives.
It was decided that the Adaptation Fund shall finance
concrete adaptation projects and programmes in developing
countries. Parties and relevant international organizations
were invited to submit views on possible arrangement for
the management of the Adaptation Fund for consideration
by SBI. The Secretariat was requested to organize a workshop
to promote exchange of views on further guidance for the
operation of the Adaptation Fund.
Challenges:
The official adoption of the Marrakech accords was expected
to promote real implementation of SCCF and LDC Fund under
the UNFCCC and Adaptation Fund under the Kyoto Protocol,
but both SCCF and Adaptation Fund have not been fully
operationalised in Montreal. Although the Article 11 of
the Convention refers to provision of new and additional
financial resources, there is no clear binding financial
commitment for Annex B countries. The amount of USD 34.7
million pledged for SCCF at COP10 and USD 27.8 million
pledged for LDCF is considered inadequate to meet the
needs of developing countries. Therefore, it is really
a challenge to improve the adequacy and predictability
of funding.
For the Adaptation Fund, both the location of the fund
and procedural issues need to be clarified. Many developing
countries expressed their preference to COP as an operating
entity of the Adaptation Fund instead of GEF. The co-financing
requirement of the Resource Allocation Framework (RAF),
a newly established mechanism by the GEF to promote transparency
and earmark funds for certain countries, could make the
operation of Adaptation Fund difficult for LDCs and Small
Island Developing States (SIDS).
5. Discussions on climate
regime beyond 2012
Decisions:
As required under Article 3.9 of the Kyoto Protocol, the
COP/MOP1 initiated a process to "consider future
commitments" for Annex I Parties for subsequent periods
after the first commitment period (2008-2012). An ad hoc
working group open to all Kyoto Parties is to be established
"without delay" and to conclude "in time
to ensure that there is no gap between the first and second
commitment periods." The first meeting of the working
group will be held in May 2006.
The COP11 decided to commence "a dialogue on long-term
cooperative action to address climate change by enhancing
implementation of the Convention" that includes "the
full potential of market-based opportunities". A
two-year dialogue with four workshops will be established
to discuss, inter alia, the following four areas: (1)
sustainable development; (2) adaptation; (3) technology;
and (4) market-based opportunities. The information provided
and views expressed by the Parties at the dialogue will
be reported to both COP12 and COP13. It was explicitly
stated, however, that the dialogue "is an open and
non-binding exchange of views" and "will not
open to any negotiations leading to new commitments."
Challenges:
Setting procedures for review of the Protocol mandated
under Article 9 will be a key challenge for negotiators.
Credible commitments by Annex I Parties: Failure to deliver
credible commitments in terms of reduction of GHG emissions
by developed countries causes a serious stumbling block
to further action, notably by developing countries. Commitments
to finance and technology transfer are also widely regarded
inadequate. It is, therefore, a real challenge how Annex
I countries that signed the Kyoto Protocol make further
efforts to meet their commitments.
Reengagement of the U.S.: Establishing a domestic consensus
on how to tackle climate change is a precondition for
U.S. reengagement. While there is a sign of growing pressure
for taking action more than the current voluntary programme,
the quick formation of domestic consensus seems still
unlikely.
" Stronger efforts by developing countries: Innovative
ways and means to promote and support stronger developing
country efforts are crucial to achieving the ultimate
goal of the Convention. Several developing countries suggested
new approaches, including a mechanism to reduce emissions
from deforestation and voluntary commitments to national
policies and measures or sectoral emission targets. Institutional
designs of these approaches need to be discussed further,
however.
6. Other issues
Decisions:
A decision establishing that the Convention's capacity
building framework is also applicable to the Kyoto Protocol
was adopted.
COP11 decided to submit the Papua New Guinea and Costa
Rica proposal on reducing emissions from deforestation
for further deliberations at SBSTA-24 in May 2006. The
proposal has two ideas: an "optional protocol"
involving a group of developed and developing countries;
and expansion of the CDM to permit crediting of activities
to reduce deforestation.
Countries also agreed on further steps on promoting the
development and transfer of technologies, and agreed to
move forward with deeper analysis of CCS technologies.
Concluding remark
While the Montreal conference witnessed several diplomatic
challenges from Parties such as USA and Saudi Arabia with
respect to post-2012 climate negotiations and compliance
issues respectively, it signified the beginning of a new
era in the international climate policy not only in terms
of maintaining the momentum and integrity of the Kyoto
Protocol and its flexibility mechanisms but also in setting
out a process for discussion on future climate regime
beyond 2012, thereby sending a positive signal to carbon
markets and on mid-and long-term perspectives for stabilizing
the global climate.
Contact
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Related link
Report: IGES's activities
at the UNFCCC COP 11 & COP/MOP1 |
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