EU unlikely to meet Kyoto emissions targets, says consultancy

EU unlikely to meet Kyoto emissions targets, says consultancy

London (Platts)--13Oct2006

The European Union is highly unlikely to meet its Kyoto Protocol
emissions targets, global consultancy Cap Gemini said in a report released
Thursday.
"Despite the implementation of the European Emissions Trading Scheme, it
is highly unlikely that the EU will be able to meet its Kyoto protocol
obligations," the company said in its eighth European Energy Markets
Observatory report.
After verified emissions data were published for 2005, the first year of
the scheme, "the EU-15 countries were 300 million mt of CO2 away from meeting
their Kyoto Protocol objective, with the notable exception of the UK," it
said.
"CO2 and greenhouse gases emissions are increasing: In 2005 energy
accounted for about 80% of greenhouse gas emissions, while electricity
accounted for 38% of CO2 emissions."
"European emissions rose by 0.4% in 2004 relative to the previous year,
and the combined EU-15 emissions were only 0.9% below 1990 levels, meaning
that the EU-15 is off-course to meet its international Kyoto Protocol
commitment to cut greenhouse gas pollution by 8% by 2012," the report said.
"These trends can be compared to reference figures: Complying with Kyoto
commitments mean a 0.3% per annum decrease over the 1990-2012 period."
"Complying with the Factor 4 ... target means a 3% per annum decrease
until 2050," Cap Gemini said. Emissions of greenhouse gases by industrialized
countries should be divided by a so-called "factor 4" in order to limit the
global warming to a further 2 degrees Celsius.
"This target is compulsory from a scientific point of view according to
the United Nations Framework Convention on Climate Change. In 2005, UK and
France passed the Factor 4 objective into law," it added.
Cap Gemini also said proposed National Allocation Plans for Phase 2 of
the EU ETS (2008-2012) were not stringent enough to constitute a major plank
in countries' efforts to meet Kyoto.
"The 19 first drafts of NAPs for this second period were published in
July 2006 and should be challenged by the EC, as 12 to 14 out of 19 are not in
compliance with the criteria published by the Commission. One could expect a
rigorous response from the Commission," it said.
Speaking to Platts Thursday, the report's author Colette Lewiner said
many of the EU countries were not being stringent enough on their proposed
Phase 2 NAPs--a position they will have to rethink when the European
Commission returns its verdict on each NAP.
"We believe the EC will be quite tough in using their weight on this
subject. On this issue, the Commission can be tough and they will be," she
added.
However, emissions trading is only one of three mechanisms set out under
the Kyoto Protocol to help signatory countries meet their targets. If
emissions trading fails to deliver a large part of the required cuts, national
governments will be forced to try to meet their targets using other measures,
for example by purchasing carbon credits under Kyoto's Clean Development
Mechanism and Joint Implementation schemes.
"To meet Kyoto compliance, countries will need to use CDM," said Lewiner.
But the Kyoto Protocol (articles 6.1 and 17) states that the acquisition
of such credits must be "supplemental to domestic actions," effectively ruling
out the idea that industrialized countries can buy their way out of emissions
cuts using carbon offsets.
Therefore, if the ETS fails to deliver sizable reductions, the EU
countries will have to reach their Kyoto targets mainly through domestic
measures, which lie outside the scope of both the ETS and CDM/JI. Failure to
achieve such measures could leave signatory countries with sizable fines for
non-compliance with the protocol, as well as negative political consequences.

---Frank Watson, frank_watson@platts.com

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