R. K. PACHAURI
says developing countries must use economic instruments to tackle local environmental problems before they can be explicitly designed for climate change
The ever-increasing threat of climate change is truly a global problem, with impacts not just in one location but elsewhere on Earth. El Niño's influence on delaying the monsoon rains in Indonesia, and thus permitting large-scale fires to rage unabated, shows that climate-related phenomena in one part of the planet can have enormous impacts in other, remote regions of the world.
Sceptics of climate change err when they believe that - even if the scientists' predictions of global warming are generally right - parts of the globe would actually benefit from it. The Earth's climate system is an extremely complex interplay of phenomena: there could not be a mere change of temperature without other impacts. Some of the regions close to the Arctic Ocean, for example, could benefit from warming, but such other effects as higher snowfall and changes in air currents and the level of the ocean might counter any benefits. Other likely effects are difficult to quantify even with the most sophisticated climate models employed by outstanding scientists.
The principle of common, but differentiated, responsibility enshrined
in the United Nations Framework Convention on Climate Change should be paramount when action is taken to mitigate emissions of greenhouse gases. The Convention has to deal with a complicated set of forces representing both the narrow self-interest of individual societies and nations and the larger common interest of the whole of humanity. Much has been said - particularly in the rhetoric leading up to the Third Conference of the Parties at Kyoto - about the 'meaningful participation' of key developing countries in reducing greenhouse gas emissions, but the proponents of this approach have scarcely been able to spell out what it means. Perhaps this is because their guarded desires go against the tenets and principles of the Convention on Climate Change and all that was agreed to in the first two meetings of the Parties. Several negotiators from developed countries seem impatient and annoyed that developing-country positions appear to be permanently obstructive and non-cooperative, insisting only on the need to transfer financial resources and technology from North to South. By articulating 'meaningful participation' they may perhaps be trying to strengthen their own bargaining positions in the negotiations for implementing the Kyoto Protocol and beyond.
There is a certain myopia in this approach, because if the true intent is to bring the large developing countries on board for mitigation of greenhouse gas emissions, it is important to understand the capacity of these countries to do what is possible and the constraints stopping them doing what is not. It would be far more productive and participative to define the areas where partnerships and cooperation are possible.
The history of action to protect the environment may help to point up where a common interest between countries of the North and the South could lie. In 1962 Rachel Carson brought out Silent Spring, triggering worldwide concern over the damage being caused to the health of the Earth's ecosystems through the effects of what we call human progress. Rapid industrialization, ignoring the internalization of environmental costs in the pricing and costing of goods and services, had led to unforeseen environmental problems in the developed world. It was only later that a new-found awakening led to action being taken to clean up rivers, the soil and air in Europe, North America and Japan. Initial efforts relied largely on command-and-control actions. After some time it was realized that, though these were successful in several respects, they were not cost-efficient.
Pollution and environmental damage originally increased in developed societies as income levels rose: it was only after action was taken to improve environmental quality in the 1960s that the damage decreased even though incomes continued to grow. This is best illustrated by the familiar environmental Kuznets curve. The developing countries are very much in the lower left hand corner of the curve, which will perhaps follow a similar shape for them as they establish their own trajectory in the relationship between economic output and environmental quality. The critical challenge that they face is to adopt institutional, technological and policy measures to allow them to pursue a much shallower curve, so that they can start improving the environment at a lower level of growing income. This is possible with the help of the policy experience established in developed countries - particularly in the use of market-based instruments - and the array of technologies now available and likely to become so in the near future. This is the area of common ground on which the interests of developed and developing countries can converge.
A dual approach
Two major issues need to be considered in looking at the possibility of using market-based instruments for mitigation of greenhouse gas emissions in developing countries.
First, many actions both improve the local environment and reduce greenhouse gas emissions. These include such options as improving efficiency in the entire energy cycle, switching from coal to oil and from oil to natural gas, using more renewable energy technologies, and improving transport systems both to make existing modes more efficient and to shift emphasis from private to public transportation.
Second, action to reduce greenhouse gas emissions can only be effective if institutional, regulatory measurement systems for protecting the local environment are in place. The developed countries have reached a point where market-based instruments can be used effectively, since they have the institutional arrangements and mechanisms to monitor and measure them properly. Developing countries will not be able to reduce greenhouse gases unless their institutions also reach a reasonable level of development and the entire architecture for taking effective environmental protection measures is established. They must trace out a lower environmental Kuznets curve; they will only be able to do so if pricing decisions, taxes and market incentives for pollution abatement become an integral part of economic policy.
Developing countries are still quite a distance from a regime that ensures the use of market-based instruments for reduction of greenhouse gas emissions. Developed countries must help them set in place the scientific and institutional arrangements for managing local environmental issues effectively. It is only once experience, success and full understanding have been achieved with using such arrangements for local initiatives that the reduction of greenhouse gas emissions can be explicitly considered. In view of the rationale of common but differentiated responsibility in the Convention on Climate Change, the architecture for effective local environmental protection in the developing countries must first be established both as a practical prerequisite and as an ethical imperative.
Dr. R. K. Pachauri is Director of the Tata Energy Research Institute, New Delhi, India.