01 - 12 December 2003, Milan, Italy

Our energy future: Creating a low carbon economy

Presented by the Delegation of the UK

Elliot Morley, Minister of State for Environment and Agri-Environment of the UK, explained that the UK has achieved emissions reductions, not only through restructuring its energy industry, but also through implementing policies and measures. Stressing the need for Annex I countries to make deep, long-term emissions cuts, and emphasizing the UK's commitment to achieving a low-carbon pathway, Minister Morley highlighted the UK's goal to reduce its carbon dioxide (CO2) emissions by 60% by 2050, with real progress by 2020, as outlined in its Energy White Paper. The 60% goal, he explained, is guided by the EU's position on the need to stabilize atmospheric CO2 concentrations at a level below 550 parts per million (ppm), or limit temperature rise to no more than 2°C.

Minister Morley explained that it will cost approximately 0.5-2% of the UK's GDP to achieve 60% emissions reductions by 2050, which he said is a small price and does not consider avoided costs. He said the reductions would be achieved through energy efficiency improvements in households, industries, commerce and the public sector, increased use of renewable energy, improvements to the transport industry, and emissions trading. Minister Morley drew attention to the UK's goal to source 10% of its electricity from renewable energy by 2010, and twice that by 2020. He underscored the need to diversify energy sources, decrease energy intensity, improve transport efficiency, internationalize research and technology support, and cooperate internationally on technology dissemination.

Adrian Gault, UK Department of Trade and Industry, described the analytical work behind the development of the Energy White Paper, drawing attention to the MARKAL energy model and key sensitivities and limitations. He outlined how the electricity generation fuel mix would vary depending on the level of carbon constraint.

Henry Derwent, UK Department for Environment, Food and Rural Affairs, outlined the international implications of the Energy White Paper. Emphasizing the need for global cooperation, he said the UK's 60% goal should send a clear message to other countries regarding the affordability of making deep emissions cuts. He stressed the importance of sending appropriate price signals, and the need for establishing emissions caps or targets. Derwent highlighted that the costs identified by the UK model should be typical for other developed countries.

Discussion: In the ensuing discussion, one participant expressed concern that the UK's energy savings might be achieved by shifting production to other countries, in which case emissions would not be reduced but merely shifted. She also expressed concern that other countries might purchase emissions credits from the UK, rather than following the UK's lead in reducing emissions domestically, and asked whether the UK will do anything to prevent this. One participant noted that the goal of stabilizing atmospheric CO2 concentrations at 550 ppm is insufficient to limit the temperature increase to 2°C. Participants also discussed: the merits of the "contraction-and-convergence" model; the potential of off-shore wind energy, as well as tidal and wave energy to contribute to the UK energy mix; and the ancillary benefits and related cost savings that would result from emissions reductions

Standards to ensure high-quality LULUCF projects with benefits for communities and biodiversity

Presented by Pelangi

John-O Niles, Center for Environmental Leadership in Business, explained that the mission of the Climate, Community and Biodiversity Alliance (CCBA) is to develop and promote standards to identify land-based projects with clear triple benefits.

Axel Michaelowa, Hamburg Institute of International Economics, showed how CCBA's standards are used to analyze projects using climate change-related criteria such as: use of relevant and good practice guidelines; statistical confidence of monitoring and verification; use of conservative baselines; and leakage assessment and response.

Olivia Tanujaya, Pelangi, outlined the issues relating to communities considered by CCBA's standards for assessing a project, including: community engagement in project design and management; community benefits and the linkage between project goals and benefits; and integration of cultural and social norms.

Cathleen Kelly, The Nature Conservancy, described the biodiversity criteria that CCBA's standards evaluate, including: adverse impacts of non-native species and site preparation; well-researched plans for planting; and the process for selecting indicators to measure benefits.

Mario Monzoni, Climate Observatory, noted that his organization formulated sustainability criteria for projects, based on process criteria, which includes stakeholder engagement, and content criteria, which involves social, environmental and economic impacts.

Stephano Merlin, Ecological Institute, described the Bananal island carbon sequestration project that was started in 1998 and examines the efforts to use the carbon value of small sinks to improve the livelihoods of the rural poor.

Discussion: Participants emphasized the importance of governance and economic viability as well as the need to maintain dialogue with host-country governments in developing standards to evaluate projects.

The International Renewable Energy Conference

Presented by the Delegation of Germany

Michael Zammit Cutajar, former UNFCCC Executive Secretary, underscored that the Kyoto Protocol is a political and economic reality, despite not being ratified yet. He announced the International Renewable Energy Conference that will be held in Bonn, Germany, in June 2004, and noted the need to determine a way to shift from fossil fuels to hydrogen energy generation.

Jürgen Trittin, Federal Minister for the Environment of Germany, said that in order to avoid development with catastrophic economic and environmental consequences, all countries should unite to guarantee that global temperatures will not rise above 2oC by 2100. He noted that renewable energy development can alleviate poverty, and create new sources of income, particularly for rural areas.

Jos Delbeke, European Commission, noted the Johannesburg Renewable Energy Coalition (JREC) that emerged during the 2002 World Summit on Sustainable Development to encourage the use of renewable energy. He underscored the importance of setting renewable energy targets for mitigating greenhouse gas emissions.

Cláudio Langone, Ministry of Environment of Brazil, noted the Latin America and Caribbean regional meeting on renewable energy held in Brasilia, Brazil, in October 2003, which identified the need to increase the use of renewable energy and set targets for doing so.

Virginia Sonntag-O'Brien, Basel Agency for Sustainable Energy (BASE) in collaboration with UNEP, noted the need for going beyond demonstration projects and financing the implementation of renewable energy.

Jennifer Morgan, Citizens United for Renewable Energy and Sustainability (CURES), highlighted the opportunity for the private sector to commit to obtain more of its energy from renewable sources.

Climate change and human health

Presented by the World Health Organization (WHO), the World Meteorological Organization (WMO), Health Canada and the United Nations Environment Programme (UNEP)

In order to reduce the negative impact of climate change on human health, Norine Smith, Canada, highlighted the importance of knowledge sharing and increased collaboration between sectors, including industry, transportation and education.

Ravi Sharma, UNEP, stated that the health impacts of climate change should be the most important issue for everyone. Sharma drew attention to the new report, "Climate change and human health: Risks and responses," published by WHO, WMO and UNEP.

Diarmid Campbell-Lendrum, WHO, presented the aforementioned report, explaining the pathways by which climate change affects human health. He listed the health effects of climate change, including temperature-related illnesses and water and food-borne diseases.

Jacinthe Séguin, Health Canada, spoke on "Methods of assessing human health vulnerability and public health adaptation to climate change," a publication by WHO, Health Canada, WMO and UNEP. Séguin explained that the publication is useful for the
UNFCCC Parties, organizations working on climate change adaptation, and governments and communities planning and delivering health services.

Bettina Menne, WHO, explained that the publication introduced by Séguin assesses vulnerability and adaptation to climate change through describing the current distribution and burden of climate-sensitive diseases, as well as through describing current strategies, policies and measures that reduce this burden.

Discussion: Participants raised questions about reliable public health data in developing countries and the lack of communication between ministries. They also discussed the extent to which climate change has affected the spread of the West Nile Virus.

"The climate change regime: A guide to rules, institutions and procedures"

Presented by the Institute of Development Studies (IDS), University of Sussex

Ambassador Raúl Estrada, Argentina, introduced the pre-publication draft of the new book "The International Climate Change Regime: A Guide to Rules, Institutions and Procedures."

Joanna Depledge, Cambridge University, provided an overview of the book, outlining its chapters on, inter alia: regime participants; mitigation commitments; flexibility mechanisms; research, systematic observation, education and public awareness; adaptation; impacts of response measures; finance, technology and capacity building; reporting and review; compliance; institutions; scientific and technical input; administering the regime; and linkages to other conventions and the wider UN system. She also drew attention to the book's appendices, which include: key statistics; tables of emissions, targets and projections; and tables of articles, issues and decisions.

Noting the complexity of the climate change regime's rules, institutions and procedures, she explained that the book aims to be comprehensive, objective, authoritative and user-friendly. Depledge explained that the authors will revise the manuscript after COP-9 to take into account suggestions, which can be submitted electronically until 9 January 2004.

Malte Meinshausen, Swiss Federal Institute of Technology, presented a series of fact sheets that are contained within the book's appendices and provide key information for each Annex I Party. He explained that the fact sheets provide tabular data regarding Parties': LULUCF emissions; international bunker fuel emissions; emissions projections; distance to the UNFCCC aim and Kyoto target; sink allowances; and per capita emissions. Meinshausen then presented a series of graphs for each Annex I country showing, inter alia, past emissions and emissions projections in comparison to targets.

Farhana Yamin, IDS, facilitated a discussion on the strengths and weaknesses of the current climate change regime. Some participants expressed frustration regarding the lack of progress within the official negotiations, highlighting that the side events tend to be more creative and forward looking.

Advancing the international climate effort

Presented by the Pew Center on Global Climate Change, The Energy and Resources Insitute (TERI) and the Institute for International Sustainable Development and Relations (IDDRI)

Eileen Claussen, Pew Center on Global Climate Change, presented the Pew Center's report on "Beyond Kyoto: Advancing the international effort against climate change." Claussen noted that this report examines issues relating to equity, future mitigation commitments, mitigation costs, uncertainties, political economy and trade.

Dan Bodansky, University of Georgia, presented the broad themes of the Pew Center's report, and noted that political will is the key element for promoting a technology revolution that involves private and public sectors. He said that climate change is a collective challenge but countries will only engage in addressing the issue if they perceive national benefits. He suggested substituting emission targets with activity targets, including: cost-effective sequestration technology; gasoline replacement by hydrogen; and zero-net emissions from the energy sector.

Margaret Beckett, Secretary of State for Environment, Food and Rural Affairs of the UK, addressed the report's theme relating to the need for international approaches to undertake a technological revolution. Beckett said that each government will need to set targets and priorities to effectively address climate change-related issues. She highlighted the need for exchanging information on technological issues.

Patrick Atkins, ALCOA, noted the slow pace of market-driven technological development and applications, and stressed that they are inadequate to effectively mitigate greenhouse gas emissions.

David Kemp, Minister of the Environment of Australia, stressed the importance of assisting countries to reduce emissions, and noted that, at the moment, the Kyoto Protocol approach does not include the biggest greenhouse gas emitters.

Bill Hare, Greenpeace International, emphasized that a global framework in which all countries make commitments for mitigating greenhouse gas emissions is absolutely essential for addressing climate change. Hare highlighted the importance of developing country participation and addressing adaptation issues. He expressed hope that a future US administration would take environmental issues seriously, and would ratify the Kyoto Protocol.

Ambassador Raúl Estrada, Argentina, addressed the report's theme relating to the workability of emission targets, and noted that the Kyoto Protocol is the beginning of the mitigation exercise to limit developed countries' emissions. He said a new approach must be found for developing countries that would allow their continued economic development.

Charles Nicholson, British Petroleum, said the Kyoto Protocol faces a difficult phase and highlighted the need to understand the relationship between energy, technology and emissions. He underscored the importance of cooperation between private and public sectors to promote renewable, hydrogen and sequestration technologies.

Chandrashekhar Dasgupta, TERI, addressed the need for increasing flexibility to better accommodate national interests and the need to ensure adequate international efforts to mitigate greenhouse gas emissions. He advocated the establishment of two types of commitments for developed countries, involving emissions and financial contributions targets. Dasgupta noted that developing country participation depends on the flow of financial and technological resources from developed countries.

Laurence Tubiana, IDDRI, said that the Kyoto Protocol provides flexibility for developed countries, and underscored the need for more flexibility for developing countries, including the possibility of different types of commitments and a parallel system involving both emission targets and sustainable development targets.

Russian Business Forum

Presented by the JI Committee and the National Carbon Sequestration Foundation

Alexander Bedritski, Roshydromet, welcomed the participants of the Russian Business Forum and stressed the important role of Russian businesses in climate change issues and in mutually beneficial greenhouse gas abatement project activities.

Corrado Clini, Ministry of Environment and Territory of Italy, announced an Italian-Russian project on climate change and JI market infrastructure developed by the Ministry of Environment and Territory of Italy and the JI Committee of the Russian Federation.

Sergei Roginko, Inter-Agency Climate Change Commission of the Russian Federation, focused on JI activity in the Russian Federation and on the governments efforts to shape an investor-friendly regulation system for JI projects.

Alexander Khanykov, National Carbon Sequestration Foundation, discussed regional initiatives on the Kyoto Protocol mechanisms currently being developed in the Russian Federation.

Leonid Maslov, Gazprom, provided an overview of corporate JI activities, stressing the role of his company in initiating the first commercial JI project in the Russian Federation.

Sergei Yakovlev, SUAL-Holding, presented his company's corporate climate strategy and corporate investment programme, focusing on JI activity.

Tatyana Monaegan, International Chamber of Commerce of the Russian Federation, stressed the importance of capacity building in speeding up the progress of JI activities worldwide.

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