What can we learn from Kyoto as Canada walks away

By John Parnell

Canadian Environment Minister Peter Kent said Kyoto was "in the past" (Source: Environment Canada)

Canada has at last confirmed what we all knew and walked away from Kyoto. Under article 27 of the Protocol, parties can do just that three years from the date that is came into force.

Kyoto was perhaps overshadowed by the first glimpse of efforts to establish a global deal on emission reductions, but a second commitment period was conspicuous in its absence from the Durban Platform.

Instead, Kyoto was bumped to next year’s COP in Qatar, and just two days after the Durban Platform was announced, Canada became the first country to walk away from it permanently.

Along with Japan and Russia, Canada had already stated its intention to pass on a second commitment period, the first of which expires in 2012. So can we expect others to leave now?

The key differentiator between Canada and the other two dissenters, is that Canada missed its targets by a whopping 23%, turning a 6% pledged decrease into a 17% increase. Only Iceland had a larger deficit.

“Lots of parties are on track for compliance and Russia will find it easy to comply, it has an AAU surplus,” says Tim Baines, senior associate with law firm Norton Rose. “The only other entity that springs to mind is Japan and I understand they are more or less on target to comply depending on how quickly they can get their nuclear power back online and scale down their standby generation.

“Given the way things went in Durban they may take the view that it is not a politically savvy move provided that they were able to meet their targets whilst avoiding massive costs in a way that Canada would not have been able to do,” says Baines.

The Canadian government stated that it had saved the country C$14 billion by walking away from Kyoto. This figure is the cost of meeting its commitment through purchasing carbon credits, a situation that would not have arisen even if they had pursued Kyoto. Their shortfall from the first commitment period would simply have carried on to a second period.

Russia has re-iterated its position on a second commitment period, its chief negotiator Alexander Bedritsky has insisted the country will not pull-out all together.

Russia is one of the largest beneficiaries from Joint Implementation projects but will be ineligible to take part after 2012. The scheme is only open to parties that have both ratified the Kyoto Protocol and have standing emission reduction pledges.

JI projects typically involve investment from Western European countries to Eastern Europe, with the upgrading of industrial infrastructure and power generation common targets. The donor receives carbon credits in return.

In September 2011, the Russian Government streamlined the application process for JI projects in Russia increasing the number that can be completed prior to the end of the first commitment period.

Japan was smashing its first emission targets under Kyoto, largely through purchasing carbon credits from overseas. Japanese Environment Minister Goshi Hosono recently said however that the loss of its nuclear energy generation following the tsunami in March 2011 meant the country now faced “an uphill battle” to meet its commitments. The county had already signalled its intent to leave Kyoto three months prior to the tsunami however.

In Durban a start date for a second commitment period was set for January 1, 2013 with an end date of December 31, 2017 or 2020 to be selected later.

Those taking part in the so-called KP2, have until May 31, 2012 to submit their emission reduction targets. Later that year, at COP18, the final terms of KP2 will be agreed.

One outcome from Durban leaving many relieved is the continuance of the Clean Development Mechanism (CDM).

“Many people have taken the view that the CDM would be able to continue even without the negotiation of a second commitment period and there are a number of legal opinions knocking around on that,” says Baines. “It’s a relief that that bullet has been dodged because there were a number of Parties tabling decisions to wind-up the CDM in the absence of a 2nd commitment period. Those arguments have fallen to the wayside for the time being.”

Will the fragility of Kyoto exposed by Canada damage the legal strength of the Durban Platform?

“It’s a lot stronger than anything we’ve had before from major emitting developing countries,” says Baines. “The wording is ‘A protocol, another legal instrument or an agreed outcome with legal force’ so there’s a suggestion that there is an outcome with legal force that is neither a legal instrument nor a protocol so there will remain questions over the interpretation of that. This draft is a political construction that will allow the EU to plough ahead with the terms that it had laid out. On the other hand it’s still open for discussion what that will turn into.”

The ease that Canada has walked away from its responsibilities and the flow of investment to countries that have already signalled their intent to end commitments, are valuable lessons for those working on a new global deal. Legal force means very little alongside gaping loopholes.

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