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Kyoto2

Kyoto2

Oliver Tickell

(2009)

Abstract

The Kyoto Protocol, the world's first tentative step towards avoiding the threat of climate change, has failed. We urgently need a new course of action. In Kyoto2 the author presents us with a strikingly original new solution. Using a system of finite production rights for greenhouse gases, which would be traded by organisations on a global auction, Kyoto2 seeks to succeed where the original agreement failed. Regulated by an independent body, the funds could be poured back into healing the wounds inflicted by climate change. In his combination of idealism with realistic proposals, Tickell exposes the flaws in current approaches, and envisions a fairer and more effective system. Kyoto2 promises to banish the dejection of the post-Kyoto era, reviving hope that the cure for the crisis facing our planet is still achievable.
Oliver Tickell is a freelance environment journalist, one-time environment correspondent at The Independent, and a regular columnist in Resurgence magazine where he writes about 'Sensible Solutions' to the world's problems.
'The most intelligent treatment of the politics and economics of climate change I have ever read. Brilliant, clear and unanswerable’ George Monbiot 'Elegantly simple and eminently workable, this is a proposal that could change the world. Kyoto2 should be read by anyone with an interest in climate change policy' Mark Lynas 'A fresh, accessible, cogent and bold case for a radical departure from most established thinking. Very seldom is an argument made with such gusto, sharpness and wisdom. Whether you agree with Oliver Tickell or not, your understanding of and thinking about this vital global challenge will be greatly enhanced by reading this book' Caspar Henderson 'Kyoto2 is bang on the nail. Exactly the kind of fresh, radical thinking that is now so urgently required' Jonathon Porritt 'Kyoto2 hits the nail on the head: we need to crank down the global supply of fossil fuels. This is much simpler and more effective than trying to cap emissions, an almost hopeless task. Climate change is a global problem that must be treated globally. Kyoto2 shows how this can be done.' Peter Barnes, Entrepreneur and writer 'Informative and illuminating, this is a radical assessment of where we're going on climate change (ever-further down the destructive slope) and where we could be headed with prompt and vigorous action (into a far healthier and still sustainable future).' Norman Myers, Oxford University, and at the Said Business School 'This is a fantastic book--timely, important, and far-reaching, a key reference for anyone seeking to understand the complexities of dangerous climate change and current efforts to reduce it. Critical in tone and thought, Kyoto2 sharply examines one of the most urgent issues of our time.' William F. Laurance, Smithsonian Tropical Research Institute 'Analytical and prophetic, Kyoto2 proposes a green economics of climate change that could just save our planet.' Miriam Kennet, Green Economics Institute 'This is the book we need, and not a moment too soon. It takes seriously the latest science, and sets out to achieve what is necessary, not what's easy.' Bill McKibben, environmentalist, writer and founder of 350.org

Table of Contents

Section Title Page Action Price
Contents v
Boxes vi
Acknowledgements vii
Introduction 1
Kyoto2 summary 8
Purpose 8
Main mechanism 9
Non-market solutions 11
Allocating resources 12
Box 0.1 Climate Convention – objectiveand principles 14
Box 0.2 In a nutshell 16
1 | What’s the problem? 17
2 | The policy response 30
The Climate Convention 30
The Kyoto Protocol 33
The Bali Roadmap 45
The EU’s Emissions Trading Scheme 48
The Montreal Protocol 52
The biofuel disaster 54
UK taxes, levies and subsidies 58
California 61
Direct regulation – other examples 65
The Climate Neutral Network 66
Box 2.1 The Renewables Obligation 62
3 | The atmospheric commons 68
Commons or free-for-all? 68
Contraction and Convergence 71
Cap and Share 76
Cap and Dividend 78
Carbon rationing with tradable quotas 79
4 | Applying market economics 81
Why a cap on greenhouse gas emissions? 84
Who should be held accountable for greenhouse gas emissions? 88
Upstream or downstream – where should greenhouse gas emissions be assessed? 90
Allocation of greenhouse gas permits – allocation or sale? 92
How should permits be sold? 95
What should we do with the money? 103
Box 4.1 Arthur Pigou and ‘Pigouvian’ taxes 112
Box 4.2 The ‘double dividend hypothesis’ 116
Box 4.3 Ronald Coase and the Coase Theorem 118
Box 4.4 Which auction? 121
Box 4.5 Pareto and Kaldor-Hicks efficiency 126
Box 4.6 Costing the future 132
5 | Non-market solutions 139
The market is not all-powerful 139
Efficiency standards on goods 143
Efficiency standards in buildings 144
The transport sector – particular considerations 146
The Montreal Protocol 151
Emissions from deforestation 152
Agriculture 155
Redirecting capital investment 157
Only clean coal 159
Reducing cement emissions 160
Ending energy subsidies 162
Energy market reform 163
Box 5.1 Ronald Coase on direct regulation 168
6 | Allocating resources 169
How much? 169
Who? 172
Adaptation Fund 175
Clean Energy Fund 180
Energy conservation in buildings 182
Clean Energy Research Fund 184
Forests and other terrestrial sinks 187
Agricultural reform 193
Geo-engineering 198
Sulphate aerosol 202
Emergency Relief Fund 205
Limiting population increase 208
Financing additional healthcare costs caused by climate change 210
Totals 213
7 | The Great Dying 215
8 | Questions and answers 224
What is Kyoto2? 224
How long should Kyoto2 run for? 224
Who might the winners and losers be at the national level, and who is therefore most likely to support or oppose it? 225
What would the effect be on energy prices? 226
What about the effect of higher fuel prices? Won’t poor people be hardest hit? 228
Is there not a danger that imposing Kyoto2 could push the global economy into recession, or at least severely impact economic growth? 229
Given that rich countries are enjoying the fruits of fossil-fuelled prosperity achieved over decades of industrialization, how can this be accounted for to the satisfaction of countries that still consider themselves underdeveloped? 231
Does the global cap supersede all the various national targets that countries have, such as the UK’s 2050 target? 233
Given that Kyoto2 primarily passes on the cost of carbon through the price mechanism, is it compatible with other national-level schemes? 233
If funding is to be given to the victims of climate change, how might this be assessed?\r 233
Assuming the whole world does not sign up to Kyoto2 at once,how would countries who have signed up trade with countries who have not? 234
Why not just have a modest $2 carbon tax on fossil fuels and industrial gases and spend the money on low-carbon energy research – as Bjorn Lomborg advocates? 235
Why not just back Contraction and Convergence? 236
How does Kyoto2 reflect the restoration of global equity, which must surely be a key part of any new climate agreement? 237
Why does Kyoto2 propose geo-engineering the planet? 238
Why does Kyoto2 propose to charge for the production of greenhouse gases from fossil fuels and other concentrated industrial sources, but not for greenhouse gases emitted from forestry, agriculture and other diffuse land-based sources? 239
What would happen to the carbon market under Kyoto2? 240
What about the ‘carbon entrepreneurs’ now producing emissions reductions under the Clean Development Mechanism? Would they all go bust under Kyoto2? 240
What would be the role of ‘voluntary carbon offsets’ under Kyoto2? And could people in effect create their own voluntary offsets by buying permits, and retiring them? 241
You don’t say much about nuclear power – why not? 242
What form might the move you want towards renewable energy take? 243
If we are facing a future of fossil fuel scarcity, do we really need Kyoto2? If accessible and economic oil and coal simply run out, as many people think they will, won’t that solve the problem? 245
What if climate scientists are wrong and the world is not really warming up after all? Then Kyoto2 would be a huge waste of time, effort and money, wouldn’t it? 246
Surely global warming is not altogether bad? Without global warming caused by human emissions, we might be going into an ice age by now. 247
How might Kyoto2 actually happen? 248
Notes 250
Notes to Introduction 250
Notes to Chapter 1 250
Notes to Chapter 2 252
Notes to Chapter 3 255
Notes to Chapter 4 256
Notes to Chapter 5 258
Notes to Chapter 6 260
Notes to Chapter 7 264
Notes to Chapter 8 265
Glossary 266
Index 280