Thursday, December 16, 2010

Cancun Wrapup: Is Your Portfolio Ready for the End of the World?

I have an article up at Asia Times, US, China Lead Merry Dance at Cancun.

It makes the case that the invective and verbiage spewed at the climate conference in Cancun reflects a shared but largely unspoken belief that the chances of coordinated global action to reduce greenhouse gas emissions are basically zero.  The key then, is reducing the financial pain and suffering for rich and large developing countries by finding ways to disregard the genuine pain and suffering for small and vulnerable countries.

There have been a few interesting and significant developments since then.

The delivery of the Cancun communique, a towering pile of steaming mush deposited on the world's doorstep, was not one of them.

Here is a more nutritious helping of news nuggets.

Killing Kyoto: The Sequel

Cancun was basically another episode in the excruciating snuff serial, Killing Kyoto, officially inaugurated at Copenhagen and designed to conclude at Durban next year (when Kyoto expires).

The United States is distinctly uncomfortable with the current Kyoto structure.  Beyond the obvious problem of the free ride for Annex II countries like China, there is the profoundly awkward moral issue of carbon reparations.

A lot of countries fundamentally threatened by climate change (represented in the G77 bloc), want the West to own up for chunking the majority of greenhouse gases into the atmosphere since the Industrial Revolution.  Kyoto--a global consensus mechanism--has served as a way for them to get their voices heard, together with demands that the industrialized countries take the economically onerous step of drastically reducing their carbon emissions and funneling tens and even hundreds of billions of dollars to the vulnerable countries in climate aid.

The US, on the other hand, is embarrassed by these small, insignificant states that, in the US view, treat their own survival as an entitlement to be guaranteed by the richer nations.

Better to let bygones be bygones, get the important players in a room, and deal with problems as they arise, seems to be the US policy.

In other words, let the poor nations beg for aid, and give it to them only if they satisfy grantors' requirements for convenience, political and diplomatic utility, and overall value for money.

One more thing: better cap the amount of aid, so it’s clearly a Western initiative, rather than open-ended compensation for screwing up the planet with 150 years of industrialization.

How about...$30 billion in fast track aid with a rampup to $100 billion per annum by 2020.

Oh, and one last thing: don’t even agree to disburse the aid until the Chinese yield on MRV—even if the Chinese aren’t receiving the aid--so it’s even more clear the aid is discretionary and not obligatory.

It’s a good deal for the West.  Getting the poorer nations to accept it involves a certain amount of heavy lifting for a certain superpower.

In my article, I touch on the Wikileaks cable reported in the Guardian that describes US outreach to the Maldives.  "Outreach" looks a lot like a bribe of a few million dollars up front to the tiny island nation to support the US position on a post-Kyoto regime.

Todd Stern, the chief US climate negotiator, went distinctly undiplomatic in his effort at Cancun to neutralize the unfavorable effect of the Wikileak.

In an article entitled US envoy rejects suggestion that America bribed countries to sign up to the Copenhagen Accord, the Guardian reported:

Stern added: "We can eliminate any cause or accusation of bribery by eliminating any money."

Stay classy, Todd.

To make it clear that we're talking discretionary grease administered by the US to compliant and deserving allies, and not payment of some carbon blood money out of moral obligation, Stern illustrated his middle-finger posturing with an anecdote of an innocent Western moneybags victimized by an odious Third World beggar (from the same Guardian article):

Speaking at the UN climate summit in Cancun, Todd Stern, the US special envoy on climate change, suggested that countries that wanted climate aid were in no position to criticise.

Citing, with approval, a confrontation at the Copenhagen summit in which a Norwegian official berated a counterpart from a developing country, he said, "he just stood up and blasted the person, 'you can't on the one hand ask for and make a legitimately strong case for the need for the need for climate assistance and then on the other hand turn around and accuse us of bribery'."

The BASIC bloc made political hay from Stern's oafishness by pointing out that they are not candidates for climate aid from the US (they are enthusiastic diners at the trough of Clean Development Mechanism funding for green projects administered by the EU instead), and Stern was only bullying the smaller, vulnerable nations--the same nations the US is trying to wedge off China. 

Per Global Times:

Xie Zhenhua, head of the Chinese  delegation in the talks and deputy director of China's National Development and Reform Commission, stressed that BASIC countries would always stand with the G77 group of developing countries.

Xie, who met with delegates from other BASIC nations, also broached the recent WikiLeaks revelations on how the US and European governments used monetary incentives, threats and even espionage to advance their "climate" agenda at last year's Copenhagen summit.

"Countries and people involved in the information that Wikileaks released should reflect upon their deeds, if the information is true," Xie said.

Gutting Kyoto has turned into a multi-stage process that involves
  • wedging off China and India from the G77 by highlighting their unwillingness to commit to Kyoto-style legally binding emissions 
  • a remarkably crude effort to hold China, instead of the West, responsible for holding back climate aid by linking release of the aid to China's acceptance of onerous "MRV" (monitoring, reporting, and verification) procedures 
  • bribing some of the smaller countries with bilateral aid to support the US position 
  • proposing capped (and suspiciously unfunded) climate aid to vulnerable countries to clear the West’s 150 year overdrawn carbon account as an alternative to open-ended Kyoto obligations 
  • using mighty diplomatic pressure to make sure that the refractory ALBA bloc of left-leaning South American governments is unable to seize the podium and make trouble.

The trend, at least for the United States and a majority of Kyoto Annex I signatories and a certain number of vulnerable states that, for whatever reason, choose to cleave to the US position seems to be: scrap Kyoto, get the small nations out of the room, and let the grownups (at least those with money) manage the climate change inconvenience through the mechanism of the G20 or its climate change affiliate, the MEF (Major Economies Forum on Energy and Climate).

One might think that putting this matter in hands of the nations responsible for the problem, able to cope with the local effects of the problem with relative ease, willing to bribe vulnerable countries for peace, quiet, profit, and advantage, and fundamentally averse to sacrificing their economies in order to solve the problem they caused is not going to yield an outcome that the smaller nations will find satisfactory.

But that's where we are.

US on PR Defensive

From a public relations standpoint, things did not quite go the US way at Cancun.

The climate is headed for a trainwreck.  Based on the current scenario--lack of significant emissions action but plenty of self-congratulatory greenspeak--global warming is going to be well north of what is considered to be very bad but maybe manageable--2 degrees--and might be as high as 5 degrees.

The fact that the United States is trying to cripple Kyoto, the only binding treaty dealing with this situation, and replace it with a multilateral rich-nations circlejerk is beginning to attract some attention.

The US came in for a lot of adverse comment from climate change NGOers at Cancun, and it even filtered into the New York Times.

Nevertheless, the US is committed to demonstrating the dysfunctionality of the Kyoto process.  If the inability of the world's nations to forge a meaningful and binding concensus is due in part to American obdurancy, well so be it.

China--which gained a lot of kudos for its relatively aggressive greenhouse gas policies--can happily watch the United States under Obama once again take the majority heat, as it did under Bush, for roasting the planet.

The other big Wikileaks noise related to climate change was a breathless piece in Der Spiegel entitled The US and China Joined Forces Against Europe (in an interesting example of the synergies--a.k.a. big media tail wagging Julian Assange dog--between Wikileaks and its media partners, as far as I can tell, Wikileaks has not yet released the cable Der Spiegel is reporting).

The article, by Gerald Traufetter, seized upon an embassy account of a visit by John Kerry to Beijing in summer 2009 to assert:

The dispatches reveal that the US and China, the world's top two polluters, joined forces to stymie every attempt by European nations to reach agreement.


During his visit to China, Senator Kerry, a former presidential candidate for the Democrats, told the Beijing leadership that the Europeans were determined to push through their goal for agreement on concrete cuts in emissions for the US and other industrialized countries. However, nothing would change for China. Together with the other "developing countries" the Chinese would merely have to say they would "work hard to reduce emissions."

The quid pro quo for the joint US-China collusion against Europe was allegedly trade in green goods like US nuclear reactors.

This article is a bookend to a much more interesting article in Der Spiegel from May 2010 based on a leaked recording of a heated Copenhagen discussion between world leaders that also pushes the Everybody's Stabbing Deutschland in the Back theme: How China and India Sabotaged the UN Climate Summit.  President Obama was identified as a co-conspirator in the body of that article, if not the title.

The Der Spiegel Wikileaks article is pretty weak beer.  The US position in summer 2009 was a matter of public record long before Wikileaks

On May 28, 2009, the Guardian reported on Kerry's trip:

In their formal positions, the two sides remain far apart. China wants developed nations to make a 40% cut in emissions by 2020 from 1990 levels, far above the goal set by President Obama's administration.

The United States wants China to set voluntary but verifiable goals to reduce its energy use and, in the longer term, to join richer nations in cutting overall emissions.

But Kerry said senior Chinese politicians had shown a willingness to compromise, particularly over the 40% target that he described as politically impossible in the US at present.

By sharing know-how and conducting joint research into renewable and energy-saving technology, he said China would realise that it can go beyond its current target of a 20% cut in energy intensity of its economy - the amount of carbon released per dollar of GDP.

It is rather clear that China and the US, though both fundamentally uninterested in accepting legally binding cuts, were at each others throats in Copenhagen, not colluding.

What happened between Kerry's trip and Copenhagen was the bruising US fight over health care, and the realization that President Obama could carry no genuine commitments on US emissions cuts to Copenhagen that could somehow finesse a consensus approach to Kyoto.

China pretty much has put its eggs in the EU basket--the Clean Development Mechanism funnels a lot of money into China--and wants to keep some kind of Kyoto arrangement going.

The United States has apparently decided that it won't be able do anything on climate change until it drives a stake through the heart of Kyoto and starts over with the Annex II countries compelled to adhere to the same regime as the EU, Japan, Russia, Canada, and the US.

But nobody believes that, once Kyoto is thrown under the bus, the United States will possess sufficient political will to legislate genuine domestic emissions reductions, let alone bankroll a massive global transition to a low carbon economy.

The inability of the US to lead on climate change, coupled with its desire to control and drive global climate change policy notwithstanding, is the source of a lot of the US-China acrimony that obscures the general developed-world paralysis on the climate change problem.

Something You'll Be Hearing More About:  Adaptation

Adaptation is the climate change measure that dares not speak its name.  Adaptation means dealing with the consequences of global warming.

Nowadays, it is still much more politically correct to talk about Mitigation--the noble crusade to reduce greenhouse gases in order to prevent the intensification of global warming.

The window for mitigation, however, is rapidly closing.

So expect to hear a lot more about adaptation aid, investment...and business.

Take it away, Katie Fehrenbacher via Reuters!

The Hot New Sector in Greentech: Adaptation

The modest agreement that came out of the Cancun climate talks this weekend points tells me one thing: It’s time to start talking a lot more about adaptation to climate change. ..

Adaptation technology has long been a slightly taboo subject, with the idea that technology should be used to stop global warming, not help humans deal with it. But more and more scientists, companies and pundits are taking the subject seriously in recent weeks, including an excellent article in The Economist last month. As The Economist article points out, the world will warm by 3.5 degrees C by 2100, and that’s if countries hit the emissions reductions targets put forth in the Copenhagen Accord.  The much-discussed 2-degree safe temperature rise is now a joke we can’t realistically hit.

So, in the face of us all crying into our pillows every night, here are 10 technologies we’ll need to help the world adapt to climate change over the next century. In Cancun, governments agreed to supply $100 billion via a Green Climate Fund for climate change adaption by 2020. Many of these technologies will be used by the world’s poorest, by farmers, and by country’s that already are facing droughts or extreme weather conditions:

1. Innovations around infectious diseases. ..

2. Flood safeguards. ...

3. Weather forecasting technologies...

4. Insurance tools. ..

5. More resilient crops. ..

6. Supercomputing. ..

7. Water Purification. ..

8. Water Recycling. ..

9. Efficient Irrigation Systems. ..

10. Sensors. ..

Yeah, stop crying in your pillows, bitches!

The "Green" in "Greentech" means money!

The Maldives are perhaps not the best Global Warming Poster Child

Finally, the Maldives.

In the ecospirit of recycling, here’s something I posted in November but didn’t circulate at the time:

The textbook image of the threat from global warming and rising sea levels is the precarious city/island of Male, capital of the Maldives island nation in the Indian Ocean.

Despite the dazzling images of its tourist resorts, the Maldives is not an unspoiled Eden with underwater cabinet meetings.

As a  fascinating photoessay by Francesco Zizola on the Maldives revealed to me, the Malidives is in many ways an artificial human construct.  The capital city, Male, is one of the most densely populated cities in the world.

In a quest for lebensraum, the island was expanded by filling in the surrounding sea floor to the encircling coral atoll and beyond.  A 3.5 meter high, six kilometer sea wall was constructed with Japanese aid to protect the island (mostly 1 meter above sea level).  Another atoll a few miles away, Hulhumale, was filled in to a height of 2 meters above sea level to serve as a new home if Male becomes unviable.

The least edifying piece of geoengineering in the Maldives is Thilafushi Island.  Zizola writes:

Thilafushi island, also known as a rubbish island, was originally a vast lagoon. It was reclaimed in 1992 using waste as the filling material to solve Male's unmanageable refuse problem. Few Bengali immigrants work at the waste disposal centre in Thilafushi. Their job basically consists of indicating to the numerous dump trucks where to unload the waste. They then incinerate part of the waste or bury the majority of it in landfill sites. No recycling is carried out and hazardous wastes are not sorted from common rubbish.

Maldives Live reports that 330 tons of rubbish make it to Thilafushi each day, some generated by the thousands of tourists visiting the Maldives, the rest coming from Male.

There are many good reasons for a concerted global effort to mitigate global warming.  However, enabling the Maldives to continue its high population density/atoll-filling/trash-dumping/tourism-based lifestyle one meter above sea level is perhaps not one of them.


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