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Curbing Climate Change
through Joint Implementation
Bert Klaassens
The
Framework Convention on Climate Change (FCCC) in the preamble states
that the human activities have been substantially increasing the
atmospheric concentrations of greenhouse gases; these increases
enhance the natural greenhouse gas effect which will result in an
additional warming of the Earth’s surface and atmosphere and may
adversely effect natural ecosystems and humankind.
The
global nature of climate change calls for the widest possible
cooperation by all countries in accordance with their common but
differentiated responsibilities and respective capabilities and
their social and economic conditions. Due to different social and
economic conditions, the developed countries are concerned with
their problems of life style, over-consumption; the overriding
priorities of the developing countries are however the economic and
social development and poverty eradication. The priorities of the
developed and developing countries are different, but that does not
necessarily imply that they are conflicting. Though the concept of
joint implementation was discussed in Article 4.2 (a) & (b) of the
Convention, the concept took a shape during the first Conference of
the Parties (CoP-I) held during March-April 1995 in Berlin wherein
it was decided to establish pilot phase for Activities Implemented
Jointly (AIJ) among Annex-I Parties (developed countries) and, on a
voluntary basis, with non-annex-I Parties (developing countries)
that so request. No credits shall acrue to any Party as a result of
greenhouse gas emissions reduced or sequestered during the pilot
phase from activities implemented jointly. AIJ under the Convention
are supplemental for achieving the objectives of the Convention, and
in no way modify the commitments of each Party under the Convention.
By
transferring technologies, which are compatible with and supportive
of national environment and development priorities and strategies,
an important instrument is developed in preventing the world from
the negative effects and the accompanying uncertainties stemming
from climate change. Whereas the benefits of the donor country are
usually clear, the costs and benefits of the host country are less
obvious. But according to my personal opinion the net benefits will
be there; certainly when one considers the sensitivity of the
developing countries toward climate change. It would be rather
naive to let the developed countries solve the emission problems on
their own, because they will, most likely, not succeed.
Joint
Implementation (JI) may not be the most efficient instrument to
curb climate change and may not be the most efficient instrument for
technology transfers. Up till now it is the only instrument that
addresses both issues and thereby creates a unique win-win
situation. Before industrialised and developing countries can
benefit from this win-win situation, however, some conceptual and
practical questions need to be answered. In order to be able to
answer these questions the pilot phase is established. Some are of
the view that the emissions can not be estimated and therefore the
emissions to be reduced by JI project is hard to calculate.
Therefore monitoring JI would be difficult. I can not agree with
this. If the composition of the burnt fuel is known, emissions can
be estimated accurately. Of course the nature of the fuel (e.g. the
richness of the ores) is of prime importance.
Another issue that needs to be solved is the problem of the high
transaction costs. The transaction cost, however, is not a problem
in itself, but is inherent to the pilot phase. The pilot phase is
designed to gain experience with AIJ projects and to gain time to
agree on solutions to the baseline and additionality problems. It
is not designed for large scale investment. The transaction costs,
stemming from the identification of potential projects, monitoring
them and from the verification of the emissions reduced, will be
averagely reduced once the operational phase with large scale
investments has taken place.
The
pilot phase projects should be confined to more decentralized
projects that improve energy efficiency or shift the supply toward
renewables instead of large energy projects etc. Another important
aspect of JI is capacity building, particularly during the pilot
phase and beyond, which will not only catalyse efficient
implementation of projects during the pilot phase but can also bring
down transaction costs. Non Governmental Organisations (NGOs)
should be allowed to play the role to catalyse the process for not
only bringing down transaction costs but also to monitor the
projects and their environmental and social benefits to the host
country. In this regard I may mention of the DESI Power Project
between Development Alternatives and DASAG (Switzerland) for
establishing small scale power plants at 20 sites in rural India
initially, based on renewables. Transaction costs will be reduced
and the needs of the rural poor will be served.
The
international discussion on AIJ/JI however is asymmetric. Whereas
the developed countries are discussing the more technical issues
like those mentioned above, most developing countries are concerned
that by allowing developed countries to reduce their emissions in
developing countries , incentives are taken away to reduce their
domestic emissions and to develop new and cleaner technologies.
Because AIJ projects need approval by both donor and host
governments, these governments play an important role. A lot of
countries have already published their national AIJ/JI policy. The
international community, and especially the Indian industry, are
waiting for the Indian government to publish a handout which can be
used to check if potential AIJ projects are according to the
guidelines of the Indian government.
Let DESI Power Systems be an example of what an
innovative and progressive NGO can initialize and only needs to be
financed by an international AIJ partner. Hopefully projects like
DESI Power Systems can convince the Indian government that, if
designed properly, JI projects can be beneficial to both host and
donor countries, so that they will catalyze AIJ, e.g. by publishing
their AIJ guidelines.
q
The author is a guest
researcher from
the University of Groningen, the Netherlands
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