ENVIRONMENT AND ENERGY OCTOBER 20, 2004
If Vladimir Putin were running for U.S. president, he might be accused of flip-flopping. After years of wavering on climate change (and once even joking that Russia could benefit from being "two or three degrees warmer"), Putin last month pushed the Kyoto Protocol through the Russian cabinet. The Russian parliament, which is dominated by Putin supporters, is expected to ratify the treaty by the end of this month. It's a big moment for the Kyoto agreement because, to become law, it needs to be signed by countries that accounted for 55 percent of the industrialized world's pollution as of 1990--and Russia's decision will now allow that to happen. Environmentalists were, not surprisingly, thrilled. Klaus Toepfer, executive director of the United Nations Environment Program, dubbed Russia's move a "cause for celebration" and Greenpeace International called it "a pivotal point in human history." Even Newsday's editors, who worried that Kyoto could "spell trouble in a time of global recession," also conceded that this was "great news for the planet."
Unfortunately for environmentalists and their cause, this euphoria is unwarranted. For one thing, the Kyoto Protocol is more a baby step in the struggle against climate change than a full-fledged victory. It requires its party states to cut emissions of certain greenhouse gases, most importantly carbon dioxide and methane, by 5.2 percent between 2008 and 2012 compared with 1990 levels. This reduction would result in only about one percent less carbon dioxide in the atmosphere, a positive development but one unlikely to appreciably affect global temperatures; indeed, even the treaty's framers recognized that deeper cuts would be necessary after 2012. Moreover, Kyoto's targets apply only to the industrialized world; developing countries are mostly exempt from the protocol's requirements. So with the United States, which produced 36 percent of the industrialized world's emissions in 1990, having opted out, and with the developing world exempted, Kyoto will at best lead to less than half the world making a minor reduction in pollution.
To be sure, any global effort on greenhouse gases must start somewhere. And if Kyoto's rules were to inspire the development of new technologies that further reduced greenhouse gases, then the treaty's relatively modest pollution-reduction targets will not have been in vain. But no one should view Kyoto's coming implementation as anything more than a very tentative first step.
And what limited promise Kyoto once held will be further diluted by Russia's membership. The protocol allows for its members to trade emissions in a sort of greenhouse gas stock market, a practice known as cap-and-trade. If Country A is 100 tons below its carbon dioxide quota it can sell that shortfall to Country B, which can then exceed its quota by the same amount. That makes a lot of sense in principle because it creates an incentive for countries to develop innovative ways to go beyond the minimum targets. But, in practice, Russia's ratification of Kyoto will have the effect of limiting the other members' pollution reductions. That's because Russia's pollution level is already far below its cap, mostly a result of the decline in state-supported heavy industry after the Soviet Union's collapse. (This is in contrast to other large states, such as China and India, whose emissions have risen dramatically since 1990.) By 1999, Russia's total greenhouse gas emissions were at 61.5 percent of their 1990 levels. This put Russia in the rather strange position of being a de-industrializing state, and of therefore having plenty of room beneath its cap--a rarity in a world where the general trajectory of economic growth means that most states, over time, bump up against their caps rather than sink further and further below them.
The problem is that Kyoto's cap-and-trade structure doesn't adequately account for an anomaly like post-communist Russia. The European Union admitted in December that 13 of its then-15 members were likely to miss their pollution-reduction targets under Kyoto, and that "further emission reduction measures will be required." (These states have, in theory, been preparing for Kyoto to take effect in 2008, even though it wasn't clear until Russia joined that the treaty would have enough members to become binding.) But now these countries will have to take fewer steps to further reduce pollution, since they can fill a large part of their reduction quota by simply buying it from Russia. True, even under this regime, the goal of an overall 5.2 percent reduction will likely be achieved, but not by virtue of Kyoto. Much of the reduction will have occurred--and already has--not because states were seeking alternative sources of fuel but because of the decline in artificially propped up industries in Russia and other former communist states. Put another way, Kyoto will end up "taking credit" for something that would have (largely) happened anyway.
Kyoto would do considerably more for the environment if the United States were included--not only is the United States the world's biggest polluter, but, more importantly, its participation in the treaty would create an incentive for American polluters to develop new technologies to reduce greenhouse gases. Following Putin's decision last month, the Independent wrote that the "pressure is now on President Bush," and Steve Sawyer of Greenpeace claimed that the "Bush administration is out in the cold." But while it would be nice to imagine that Putin's decision puts pressure on the United States to sign on to the protocol, Russia's decision actually makes it less likely that the United States will join. That's because the other members now have little reason to offer the United States something in return. The United States would, as a Kyoto member, compete for purchase of Russia's quota space, meaning that the other industrialized states would be forced to make greater emissions cuts. In that sense, now that Russia has signed on, Japan and Europe are better off without us.
This situation highlights the shortcomings of international environmental agreements. As the world prepares for the next round of climate change negotiations, due to take place in Buenos Aires in December, it must find a way to reward sincere efforts to adopt cleaner technologies and reduce greenhouse emissions if it hopes to improve on Kyoto's illusory accomplishments. All told, Russia's joining Kyoto was about politics first, economics second, and environmentalism a distant third. Putin has secured Europe and Japan's support for Russia's WTO membership and a visa-free relationship with the European Union. Russia stands to make billions of dollars by selling its quota space. And all this while making few if any cuts in pollution. It's a win-win for Russia. But "great news for the planet"? Let's not exaggerate.
Yonatan Lupu is an attorney in Washington, D.C.
By Yonatan Lupu