From Poznan to Copenhagen: Much left to do

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If there is to be a global deal in Copenhagen - or any time after that - a number of issues have to be clarified.   The developed country signatories of the Kyoto Protocol have to say what level of emissions reduction they are prepared to commit to over the commitment period coming after 2012 (which may or may not be up to 2020).  The principal developed country non-signatory of the Kyoto Protocol – the United States – has to do the same, with clarity over what form that “commitment” might take.  The developing countries have to at least hint how, despite their lesser obligations under the Convention and Protocol, they see the road towards some sort of emissions reduction commitments by the larger and more developed of their number.  And the developed countries have to say how much technology they are prepared to transfer and how much money they are prepared to contribute to developing country costs of climate change adaptation and emissions reduction. 

Progress towards all these broad objectives in Poznan was at best mixed, and in total pretty poor.  The EU stumbled towards confirmation of its unconditional and conditional promises of reductions by 2020, but still looks out on its own.  The agendas and timetables for an extremely busy year were clarified, but all parties are still interested in picking up and keeping negotiating cards, not discarding them or clearing the tables by settling subsidiary issues.

It is a commonplace that climate negotiations will only make progress in an atmosphere of trust.  This whole issue is, after all, a perfect example of the “Prisoners’ Dilemma”, and it is well-known that the only way out of the dilemma involves trust as well as leadership.  Perhaps it was in consciousness of this that the Polish Presidency of the negotiations at Poznan focussed on finalising the developing countries’ Adaptation Fund, which is funded by  a levy on the Clean Development Mechanism, in the hope of removing an obstacle to progress and to the building of trust between developed and developing countries.  But this did not work.  Probably driven by the suspicion that direct contributions from developed country Governments to support international expenditure on adaptation would not be forthcoming or would come with strings, the developing countries mounted a very strong campaign, within the portion of the Poznan negotiations devoted to reviewing the Kyoto Protocol, to extend the levy principle to cover the Joint Implementation mechanism and to emissions trading.  When this did not happen – since this too is an issue that some negotiators believe should be held over to form part of a bigger deal, and it is hardly consistent with promoting and expanding these market instruments – the last comments from developing country negotiators before Poznan closed were bitter, and doubts about success at Copenhagen were openly expressed.

A  massive number of issues were covered in Poznan’s negotiations, to say nothing of all the advances in analysis, market development and technology that were presented and debated in the side-events and associated exhibitions and conferences. Some, such as the reviews of progress with the CDM, are of great importance to today’s market. However it is easy to be distracted by these from the big issue, both for the carbon market and (given the role of the carbon market in making climate ambitions more deliverable and more affordable) for the world.  That issue is how much of a step we have taken in Poznan towards an international deal on climate change that will define or at least influence the size, depth and liquidity of the carbon market beyond 2012.  The answer is a very small step, and there is so much yet to do that even the UNFCCC Executive Secretary has had to admit that an outcome at Copenhagen cannot be taken for granted. 

But 2009 is not the last chance.  Ratification by national Governments of decisions made in the negotiations can take a long time, and the continued uncertainty can only be deplored by anyone who wants to see the market given the conditions to do its work.  But one of the more significant pieces of news from the last hours of Poznan  is that South Africa, more than ever the key spokesman and broker of developing country negotiating positions, has agreed to host a Conference of the Parties – in 2011.

Henry Derwent is President and Chief Executive of the International Emissions Trading Association. He was formerly Director of climate and energy at the UK Department of Environment, Food and Rural Affairs (Defra) and a special adviser on climate change to former UK Prime Minister Tony Blair.