TL:GREENPEACE BRIEFING ON JOINT IMPLEMENTATION SO:GREENPEACE INTERNATIONAL DT:FEBRUARY 1994 Keywords:atmosphere climate change conferences reports / JOINT IMPLEMENTATION CRITERIA AND INC9 INC9 is to discuss the question of joint implementation criteria for ultimate approval by the First Conference of the Parties (COP1). The Secretariat's paper on criteria for joint implementation (A/AC.237/49) does not sufficiently take account of the main controversy that arose during INC8 regarding joint implementation, joint implementation between developed (Annex I) and developing (non-Annex) countries. Several countries (most developing and some northern) have expressed their concerns regarding such partnerships. INC9 should consider these concerns carefully. Greenpeace believes that INC9 should agree on the following principles for criteria of joint implementation: - joint implementation actions should only involve Parties having quantitative emission reduction commitments and reliable baselines, - joint implementation should not be used for emission credit at this stage until legally binding emission reductions have been achieved by developed countries. In order to enhance the environmental effectiveness of the Convention and demonstrate the commitment of developed countries to a fair and equitable regime for limiting and reducing carbon dioxide and other greenhouse gas emissions joint implementation projects should be conducted that are additional to existing obligations. In addition, INC9 should begin discussing criteria for additional joint implementation obligations that meet the following general criteria: REVIEWABILITY AND QUALITY CONTROL Joint implementation projects should be reviewable by the COP and its designated subsidiary body to ensure that operational criteria, such as those mentioned above are being met. Registering and verify GHG inventories and emission baselines and other information on projects is vital for the ongoing development of the global response to climate change. A bilateral system without independent verification is open to abuse. In this respect Greenpeace is concerned that the third criterion of the Secretariat's paper that states that a joint implementation activity would have to be accepted by, and fall under the responsibility of the Parties concerned, could leave Joint Implementation assessments outside the overall authority of the COP. Joint implementation actions must verifiable and reported according to a common methodology. A multilateral institutional arrangement for the management of joint implementation should be established at an appropriate time, when the other criteria are met. ADDITIONALITY Joint implementation should be additional to the obligations of the Annex II countries to transfer capital and technology to developing countries and to pay the full agreed incremental costs of measures taken in developing countries to mitigate climate change and additional to projects that would have been carried out anyway. EQUITY Joint implementation projects should be socially acceptable in the receiving country, and a social impact procedure should be part of the initial phase of the project. Such projects should stimulate the development of the local technological structure and ensure positive local social- economic (capacity-building) effects or compensation for negative effects to ensure the support of the recipient country/community. PARTICIPATION AND TRANSPARENCY The whole process of the development of a joint implementation project ( definition, implementation and verification ) should be open to consultation with approval of the local community, NGOs and other interested parties to ensure that all local social, economical and environmental costs and benefits are included. Where necessary, resources should be provided for local NGOs to participate meaningfully in the consultation phase. LOCAL ENVIRONMENTAL EFFECTIVENESS Local environmental effects must be positive, with projects subject to environmental impact assessment procedures. This is necessary to ensure other environmental disasters eg. hydropower and nuclear power are not promoted. COMPREHENSIVENESS Full environmental, social and economic accounting for the activities in the host country by the sponsoring party should be included to ensure that the intent of the Convention is being met. BACKGROUND Greenpeace has grave concerns that the use of joint implementation measures for emission credits prior to the development and implementation of real and effective national emission reduction commitments will seriously undermine the political and environmental effectiveness of the Convention. The Climate Convention envisages that Parties to the Convention may jointly implement measures to achieve their commitments, subject to the development and approval of criteria. Joint implementation is perceived to offer a means of obtaining credits against emission reduction obligations within one's own borders, by undertaking emission reduction projects in other countries. One of the principal justifications cited for joint implementation is "cost-effectiveness". However, Greenpeace believes that cost-effectiveness should be only one consideration in reaching the ultimate environmental objective of the Convention, the stabilisation of greenhouse gas concentrations at a protective level. Joint implementation is also perceived as a means of transferring technologies and know-how to developing countries in addition to those opportunities provided through the operation of the funding mechanism and other provisions of the Convention. Advocates of joint implementation argue that the concept should provide a self- reinforcing mechanism for this transfer, thereby enabling developing countries to technologically "leap-frog" to the most efficient and clean technologies. ENVIRONMENTAL EFFECTIVENESS OF THE CONVENTION The ultimate objective of the Convention is to achieve the stabilisation of greenhouse gas concentrations in the atmosphere at a protective level (Article 2). The current emission stabilisation commitments for developed countries are not sufficient to achieve this objective. The first priority for developed countries must be to implement the current emissions commitments and to negotiate further emission reduction obligations, for adoption at the First Conference of the Parties. The use of joint implementation to avoid even the current insufficient commitments undermines any possible realisation of the Convention's objective. Greenpeace believes that the overall intent of the Convention and of Article 4(2)(a) is that all Parties involved in joint implementation must have similar emission commitments and clear emission baselines. Joint implementation conducted between Parties that have dissimilar quantitative obligations - that is, between developed nations and developing countries who do not have quantified emission commitments or economies in transition with declining emissions - threatens the long term environmental effectiveness of the Convention. Under these circumstances there can be no guarantee that aggregate global emissions would be reduced, since there will be no way of verifying if the joint implementation actions have reduced emissions in these countries below what would otherwise have occurred. The process would be open to abuse, including double counting and the shifting of emissions to other countries. Emission limit obligations on all parties involved in joint implementation would prevent double counting, fake additionality, counter productive strategic behaviour ( for example waiting with measures because a worse situation could attract more projects, bad environmental policy could be rewarded this way) and the shifting of emissions to other locations. Joint implementation for credit between Annex II countries and other Annex I countries (ie Economies in Transition - the former USSR and Eastern Europe) gives rise to a similar class of problems. The Convention defines developed countries to include those of eastern Europe and the former Soviet Union. The latter economies now often have declining emissions as a consequence of economic collapse as well as previously excessively inefficient energy use and production practices. This situation gives rise to the potential for joint implementation to be abused by countries. In this context Greenpeace believes that the intent of the Convention is to reduce emissions below the level that would otherwise have occurred. Where the "business-as-usual" emissions of one party to joint implementation are likely to be below the 1990 levels over the period to 2000 (and for some period thereafter) the potential exists for joint implementation to result in no real reduction in their aggregate emissions. Parties could claim emission credits from actions in EITs, whilst they, or other Parties may be undertaking actions, not reviewable by the Convention, that have the effect of lifting emissions from their declining level towards the 1990 level. In other words, returning jointly to 1990 emission levels by an Annex II country with increasing emissions and an Economy In Transition country with otherwise decreasing emissions does not guarantee real emission reductions and is not consistent with the intention of the Treaty. The issue of global environmental effectiveness would be served by ensuring that the Parties engaged in joint implementation have quantitative emission reduction commitments, and an agreed baseline from which the effect of actions undertaken may be measured. POLITICAL EFFECTIVENESS Greenpeace believes that attempts by developed countries to use joint implementation measures to obtain emission credits could be seen as an attempt to evade their obligations to act first. Such attempts could seriously undermine the confidence of developing countries in the Convention and ultimately reduce the prospects of their agreeing binding emission limitations. Achievement of the Convention's overall objective of stabilising greenhouse gas concentrations would thus ultimately be threatened. The Convention requires developed countries to take the lead in addressing the problem and to do this by the adoption of national measures to limit their own emissions. The Convention also obliges them to assist developing countries by paying the full incremental costs of mitigating measures and by the transfer of technology and information. It is not consistent with the intent of the Convention that developed countries should receive credit for what they are already obligated to do. Furthermore, with developing countries likely to have to adopt quantifiable emission obligations in the future, global equity may not be served if developed countries have already used up cheap emission reduction opportunities in developing countries. In view of these considerations, Greenpeace believes that industrialised nations should focus on assisting developing countries by stimulating projects that reduce emissions. They should not receive credit for these projects because they are already apart of their obligations under the Convention. Greenpeace believes that a new international institution is needed to support the transfer of know how and technology to developing countries, and others, in order that they may limit the growth in their emissions. ECONOMIC EFFECTIVENESS To a significant extent the overall economic effectiveness of global moves reduce greenhouse gas emissions will depend on the rapid development and deployment of energy efficient and renewable energy technologies in the world's largest economies. Advocates of joint implementation as a "cost-effective" device for developed countries overlook the potential for this approach to undermine the rate of technological innovation and market penetration in developed economies. By diverting effort from national emission reduction programmes and the policies designed to achieve these, joint implementation could slow down or stop the adoption of much needed improvements in the energy efficiency of many industrialised countries. In particular it could delay the adoption of measures desperately needed in the transport sector to protect human health and the natural environment in addition to the climate. Often joint implementation is advocated from the point of view of a particular economic sector heavily dependent on the production of energy from fossil fuels. Ignored often is the perspective of those sectors that would benefit economically from more rapid global adoption of energy efficient and renewable energy technologies. Joint implementation could thus increase the costs of achieving deeper emission reductions in the future through the inhibition of technological innovation and commercialisation in developed countries. For further information: Mr. W.L. Hare Climate Policy Adviser Ms. A. Stevens Associate Adviser Greenpeace International Keizersgracht 176 1016 DW AMSTERDAM Tel: 31 - 20 - 523 6 555 Fax: 31 - 20 - 523 6 500