Daily report for 4 March 1997

Delegates to the sixth session of the Ad Hoc Group on the Berlin Mandate (AGBM-6)began consideration of elements related to strengthening commitments in Article 4.2 (a)and (b) and focused specifically on policies and measures (P&Ms). AGBM also conveneda "non-group meeting" on elements related to advancing the implementation of existingcommitments in Article 4.1.

POLICIES AND MEASURES

AGBM Chair Ral Estrada-Oyuela (Argentina) opened the second meeting of AGBM-6by stating that this meeting is not intended for negotiating but for refining andconsolidating similar proposals contained in the Framework Compilation of Proposals(FCCC/AGBM/1997/2 and Add.1) to set out clear alternatives for negotiation at AGBM-7.

Annex I Expert Group Chair Ian Pickard (UK) reported on studies, carried out incooperation with OECD and IEA, on carbon and energy taxation, P&Ms to encourageinnovation in transport and technology and international greenhouse gas emissionstrading. FCCC/AGBM/1997/MISC.2 contains an executive summary of these studies.

The Chair called on AGBM to consider the submissions on general commitments andguiding objectives for P&Ms. SAMOA called for a coordination mechanism to assistAnnex I Parties in implementing their commitments, as proposed in the AOSIS protocol.The mechanism would provide advice on a full range of measures including taxes andsubsidies and would report regularly to the "Meeting of the Parties." The mechanismwould be multi-disciplinary and open to participation by all Parties, governmentrepresentatives, NGOs and scientists with relevant expertise. SAMOA also noted theneed to avoid duplication of tasks, but expressed concern that existing subsidiary bodiesmay not be appropriately equipped to address technical issues.

SAUDI ARABIA and CHINA said the comments from Parties contained in documentFCCC/AGBM/1997/2/Add.1 should be included in the Framework Compilation. CHINAalso expressed confusion regarding references to Annexes X, A and B in the proposalsand urged Parties to refrain from developing new categories. JAPAN suggested thatAnnex I Parties adopt P&Ms according to national circumstances, in the areas of efficientuse of energy, low-carbon energy, technological development and cooperation, andenhancement of sinks. The "Meeting of the Parties" shall decide on indicators for P&Ms.

The EU, supported by SWITZERLAND, favored legally binding P&Ms and highlightedhis proposed Annexes A (common P&Ms), B (coordinated P&Ms that receive highpriority) and C (priority P&Ms for inclusion in national programmes). The proposalcontains P&Ms on: renewable energies; energy efficiency standards; labelling and otherproduct-related measures; transport sector; economic instruments; energy policies;industry sector emissions; agriculture sector; forestry; and fluorocarbons.

Several delegations commented on the EU proposal and some noted alternativeapproaches and priorities. POLAND and the RUSSIAN FEDERATION supported amenu approach, which takes account of various economic structures and attempts tomaintain a high and stable rate of economic growth. The G-77/CHINA, supported bySAUDI ARABIA, stressed that P&Ms should not have adverse impacts on developingcountry Parties. He also expressed concern about new annexes that would impose newcommitments on non-Annex I Parties. The EU reiterated that his proposal providesflexibility through Annex B, which lists P&Ms to be applied according to nationalcircumstances.

The US and SAUDI ARABIA did not support inclusion of specific P&Ms. The US alsonoted that sound information is not available for controlling greenhouse gases not listedin the proposed Annex C and suggested elaborating on P&Ms under the section onreporting. SAUDI ARABIA also warned that P&Ms undertaken by Annex I countriescould negatively affect trade with developing countries. IRAN stressed the need for asection on general commitments and guiding measures in the protocol.

The EU clarified that energy efficiency, standards and labeling, as well as P&Ms relatedto fluorocarbons, should be the highest priority. He also noted that paragraphs proposedby a number of Parties including Norway, Iceland, New Zealand and Switzerland couldbe integrated into the EU proposal. He said some developed countries, particularly theUS, have not included binding measures in their proposals and emphasized the EU’sconviction that P&Ms should be included to fully encompass the Berlin Mandate andGeneva Declaration.

CHINA reiterated that the Berlin Mandate requires an elaboration of P&Ms whoseobjectives should be clear at this stage. He said the EU proposal is too complicated andsupported a proposal by the Chair to use three "groups" rather than annexes on objectives,common but coordinated P&Ms and national P&Ms. The US also cautioned againstincluding too many details and cited a number of examples illustrating the difficulties ofproposed P&Ms related to specific products.

The EU did not support the groupings proposed by the Chair and noted they were difficultto distinguish. He said objectives should not be separated from mechanisms andmeasures, and proposed listing all of them in Annex A. He also said that relevant detailsrelated to specific products must be considered because they are traded in theinternational market and an international agreement is needed to ensure results.

The EU also reported that the EU Council had reached a common position on QELROS.The EU proposed that Parties to the Berlin Mandate will reduce emission levels for CO2,CH4 and N2O by 15% by 2010 with a reference year of 1990. The EU also proposed aninterim target for 2005.

The Chair also requested delegates to consider a proposal regarding countries witheconomies in transition that requests a specific annex because of their particularcircumstances. The EU did not support a separate annex and noted that the concerns ofthese countries could be addressed elsewhere, such as in an introductory section. TheChair, supported by IRAN, said these concerns are better addressed when consideringQELROs.

ROUNDTABLE ON DIFFERENTIATION

Chair Chow Kok Kee (Malaysia) welcomed the speakers on differentiation and called fora non-confrontational process that promotes understanding rather than political positions.Mr. Harald Dovland (Norway) said that differentiation provides for a more equitable andambitious goal than the lowest common denominator agreement allowed by a flat-rateapproach. He highlighted single and multiple criteria approaches to differentiation andemphasized that differentiation formulas are not necessarily meant to determine bindingtargets, but to provide tools for guiding negotiations. He cited the EU’s proposed goals asan ambitious example for differentiation and cautioned that flexible instruments, such asjoint implementation, are not a replacement for differentiation.

The US did not support the suggestion that progress can be achieved throughdifferentiation and said that under a flat rate countries could accomplish more. Hequestioned the "trade off" between differentiation and a flat rate and asked if a system ofdifferentiation is necessary. The Chair then introduced other panelists, who spoke in theirindividual capacity.

Mr. Akihiko Furuya (Japan) said that differentiation is indispensable for achievingfairness and noted that the Berlin Mandate calls for taking into account the differentstarting points of countries. He discussed a "formula-based approach," under whichQELROs can be divided according to specific indicators. He also noted the "selectiveapproach," under which countries could use GDP as an indicator, and the "negotiationapproach," under which each country would negotiate its QELROs with other countries.

Mr. Maciej Sadowski (Poland) said that the preferred approach involves differentiationby countries and noted that aggregation into groups could be effective. He underscoredthe political difficulties in agreeing on a common set of criteria and proposedconcentrating on the target to be achieved by each Party.

Amb. Louet (France) noted that differentiation is not a result of theoreticalconsiderations, but of unavoidable practical necessity. He noted that the EU has adopted acommon position and explained that a greenhouse gas emission reduction of 30% forLuxembourg and 25% for Germany, could be offset by Portugal’s and Greece’srespective greenhouse gas emission increase of 30% and 40%, which account fordifferences in starting points. He noted that even countries favoring the flat-rate conceptrecognize the need for flexibility. He cautioned that a tradable permit system would givepremium to the biggest producer of greenhouse gases.

The EU underlined the differences in countries’ ability and costs associated with meetingcommitments. As a regional group, it is taking on joint commitments and will engage ininternal burdensharing. A number of EU countries are willing to commit themselves toreduce emissions. SWITZERLAND stressed that there is no good unique indicator thatcan take into account national circumstances and said that the logical starting point of thediscussion is agreement on the quantity to differentiate.

The US suggested focusing on targets, outcomes and QELROS so that overall reductionscan take place while Parties who find targets burdensome can trade emissions with others.GERMANY urged countries to enrich progress by making concrete proposals regardingnumbers for significant overall reductions and the contributions that countries intend tomake toward these goals.

Amb. Howard Bamsey (Australia) stressed that differentiation is necessary for reflectingdifferent national circumstances. He noted there are a large number of proposals, but asmall number of indicators. He outlined common groups among proposed indicators:those based on economic structures and resource bases; those based on emissionreduction tasks including population growth, economic growth and per capita resources;and others based on trade impacts.

GERMANY stated that differentiation within the EU was not based on indicators,because indicators do not reflect political reality. She noted that Germany, Denmark andAustria accepted the largest shares of the reduction burden because they are convincedthat combating climate change is important. The US noted that the EU collectively arguedin 1990 that they would reduce emissions drastically. He said this reduction would havebeen possible with a flat-rate.

GERMANY, referring to the EU experience, suggested making a joint commitment for a future protocol, setting common targets for Annex I Parties and deciding how to share them. AUSTRALIA asked how differentiation was achieved within the EU and noted this could set an example for Annex I countries on the road to Kyoto. ICELAND stressed the need to reach conclusions on differentiation before Kyoto.

IN THE CORRIDORS

Several participants provided favorable reviews of the non-group’s efforts to fulfill itsnon-mandate of streamlining the Framework Compilation. One participant reported that the non-group narrowed the options and will submit a revised text to AGBM. Anothercommented that some delegates appeared unclear on the concept of streamlining and usedthe meeting as an opportunity to regurgitate lengthy, all too familiar positions.

THINGS TO LOOK FOR TODAY

AGBM: Plenary will convene at 10:00 am in the Plenary I Hall to considerQELROS.