• A dome with sun rays on it and snow in the mountains behind it

      Pasadena City Hall at winter time (Photo – W.K.)

      The 25th United Nations Conference of the Parties (UN COP) in Madrid ended in failure few weeks ago, with no agreement on a potential international carbon market.

      By Ethan Elkind

      How big a deal is that failure?

      I attended the UN COP in Madrid with my UCLA Law colleagues and witnessed dynamics similar to those described by them. As long as I’ve worked in the climate field, I’ve been a skeptic of these UN processes. On one hand, the UN COPs can serve as useful, politically galvanizing events that can offer networking, idea-sharing, and important media coverage to highlight this issue for the public.

      On the other hand, any success at a UN COP may instill a false sense of optimism that international leaders are solving the problem; in fact, even with successes like the agreement achieved at the Paris COP in 2015, the real action happens among decision makers largely absent from these international discussions. For example, state and provincial leaders typically set rules for electricity grids that determine their carbon emissions, and local officials often are responsible for planning cities that sprawl or not, decide whether to fund transit over automobile infrastructure, and often permit new factories and industrial facilities in their jurisdictions.

      A man standing in front of large letters spelling COP 25

      Ethan Elkind in the COP 25 “Blue Zone” for negotiators and observers (Photo – Author)

      In that context, any progress at the UN COP in Madrid wasn’t likely to make a significant dent in worldwide greenhouse gas emissions unless translated effectively and urgently to decision-makers down the chain. In short, a failure at any given COP to reach an agreement is often more of a symbolic blow than an actual policy setback, while the opposite remains true: success is only pyrrhic without follow-up action by decision makers across the globe, at all levels.

      The focus of the UN COP in Madrid was provisions related to a potential global carbon market under Article 6 of the Paris agreement. Carbon markets by themselves are unlikely, however, to be a key solution on emissions. Even in a state like California, one of the world’s leaders on decarbonization, the cap-and-trade program has marginal impact. Allowances trade for near the price floor, with no real evidence that the program is the but-for cause of any emission reductions at regulated facilities. Meanwhile, the auction proceeds from the sale of allowances under the program generate more than a few billion dollars a year for programs like high speed rail, building weatherization, and transit-oriented development projects.

      In short, California’s carbon market functions as a low-level carbon tax that generates funds for some carbon-reducing projects, but it is not responsible (as best we can tell) for any meaningful emission reductions.

      I don’t mean to slam the carbon trading program – it can be a useful tool for government to employ. It also has been overshadowed in part by the success of California’s rapid decarbonization in other sectors.

      The real heart of California’s climate program it its mandates. California specifically mandates that utilities procure renewable energy and energy storage, that automakers produce zero-emission vehicles, and that appliance manufacturers and homebuilders apply energy efficiency standards to their products. Without these and other mandates, as well as the various state incentives that typically accompany them, California would not have seen great success over the past decade.  California reduced emissions so quickly that it met its 2020 greenhouse gas goal four years early.

      A group of poeple listening to a panel

      Side panel at the U.S. Pavilion in Madrid (Photo – Ethan Elkind)

      Had any of these other programs failed – especially the renewable energy program, which was most responsible for state emission reductions – the cap-and-trade program would have taken on more importance. The fact that we did not need carbon trading in California demonstrates that other nations and states can achieve emission reduction success through a similar recipe: decarbonize electricity and transportation, focus on industrial and agricultural emissions, and do everything possible to reduce short-lived climate pollutants.

      Going forward, perhaps following a change in federal leadership in the U.S., the real action at these international gatherings may take place at smaller venues such as the G20 (attended by the leaders of countries responsible for 75% of global emissions). And perhaps one day the COPs can transition to a more sectoral focus. For example, I’d love to see a UN Conference focused exclusively on advancing zero-emission vehicle technologies or a decarbonized electricity grid. We potentially could make significant and meaningful global progress by focusing on the technology solutions we know we need to deploy widely right away.

      Without success in Madrid this past week, the world is where it essentially always was and would have been anyway, with or without carbon markets under Article 6: in dire need of strong national, state and local action to decarbonize key economic sectors as quickly as possible. A global carbon market potentially could help with that effort, but it will not be sufficient by itself.

      The real progress on climate change will take place once again city halls, state legislatures, provincial governments, and other decision-making bodies around the globe.


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