The Global Carbon Markets Recap
Helvecio Borges Guimaraes
Issue date: 11/6/07 Section: Voices
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Refreshing…
After two rather dense and maybe long articles, I thought it would be nice to recap the basics of what I have been discussing. I will attempt to keep things as simple as possible.
In a timeline, it goes as:
1992: United Nations Framework Convention on Climate Change (UNFCCC) is signed during the Earth Summit in Rio. What you need to know: almost all countries are signatories; countries have common but differentiated responsibilities, i.e., some countries (advanced economies and economies in transition - former USSR) have greenhouse gas (GHG) emission reductions targets, whereas all other countries do not have such targets. Countries with targets are listed in the Annex I to the Convention.
1997: during the third conference of the parties to the UNFCCC in Kyoto, Japan, a protocol is agreed upon. What you need to know: in the Kyoto Protocol, each Annex I country is assigned emission reduction targets, with 1990 as the emissions baseline year; those targets should be reached by year 2012 and would mean a reduction of, on average, 5.2% of GHG emissions; though there are several gases that contribute to the greenhouse effect, only 6 are covered in the Protocol; three flexibility mechanisms are created in the Protocol - Emissions Trading, Joint Implementation, and the Clean Development Mechanism (CDM); the mechanisms were created with the minimization of the overall cost of achieving the reductions in mind - since the benefit of the reduction is global, it doesn't matter if reductions are achieved in Mali or in Switzerland; of the three mechanisms, the CDM is the one most talked about, and thus more institutionalized; finally, the Protocol would enter into force only after at least 55 countries had ratified it and at least 55% of the 1990 GHG emissions were represented in ratifications (in practical terms that means the Protocol, after having being ratified by at least 55 countries, would enter into force only if either Russia or the United States ratified it.)
After two rather dense and maybe long articles, I thought it would be nice to recap the basics of what I have been discussing. I will attempt to keep things as simple as possible.
In a timeline, it goes as:
1992: United Nations Framework Convention on Climate Change (UNFCCC) is signed during the Earth Summit in Rio. What you need to know: almost all countries are signatories; countries have common but differentiated responsibilities, i.e., some countries (advanced economies and economies in transition - former USSR) have greenhouse gas (GHG) emission reductions targets, whereas all other countries do not have such targets. Countries with targets are listed in the Annex I to the Convention.
1997: during the third conference of the parties to the UNFCCC in Kyoto, Japan, a protocol is agreed upon. What you need to know: in the Kyoto Protocol, each Annex I country is assigned emission reduction targets, with 1990 as the emissions baseline year; those targets should be reached by year 2012 and would mean a reduction of, on average, 5.2% of GHG emissions; though there are several gases that contribute to the greenhouse effect, only 6 are covered in the Protocol; three flexibility mechanisms are created in the Protocol - Emissions Trading, Joint Implementation, and the Clean Development Mechanism (CDM); the mechanisms were created with the minimization of the overall cost of achieving the reductions in mind - since the benefit of the reduction is global, it doesn't matter if reductions are achieved in Mali or in Switzerland; of the three mechanisms, the CDM is the one most talked about, and thus more institutionalized; finally, the Protocol would enter into force only after at least 55 countries had ratified it and at least 55% of the 1990 GHG emissions were represented in ratifications (in practical terms that means the Protocol, after having being ratified by at least 55 countries, would enter into force only if either Russia or the United States ratified it.)
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