Eileen Claussen

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Whether we like it or not, global warming is shaping up as one of the most important challenges of the 21st century. It is going to drive far-reaching changes in how we live and work, power our homes, schools, factories, and office buildings, get from one place to another, manufacture and transport goods, and even farm and manage forests. It touches every aspect of our economy and our lives, and to ignore it is to live in a fantasy land where nothing ever has to change - and where we never have to accept what science tells us about what is happening to our world.

My goal is to give you a clear idea of where we stand today in the effort against global climate change. To do that, I would first like to offer you an insider's look at how the world and the United States have responded to this challenge over the last decade.

I would like to suggest to you five keys to success - five things we need to do if we are to successfully meet the challenge of climate change.

Let us travel back in time to 1992, when another George Bush was our President, and when the nations of the world gathered in sunny Rio de Janeiro for the United Nations Conference on Environment and Development, affectionately known as the Earth Summit. This was the event, you may recall, where more than 150 countries signed an agreement called the United Nations Framework Convention on Climate Change (UNFCCC).

Perspectives on Climate Change: Science, Economics, Politics, Ethics Advances in the Economics of Environmental Resources, Volume 5, 181-188 Copyright © 2005 by Elsevier Ltd. All rights of reproduction in any form reserved ISSN: 1569-3740/doi:10.1016/S1569-3740(05)05008-X

The UNFCCC, as it is known, set an ambitious long-term objective: to stabilize greenhouse gas concentrations in the atmosphere at a level that would "prevent dangerous anthropogenic (or human-caused) interference with the climate system.'' This is a goal that the United States, and virtually every other nation, has embraced.

As a first step, industrialized countries agreed to a voluntary emissions target: they aimed to reduce their greenhouse gas emissions to 1990 levels by the year 2000. Before long, however, it became clear that the targets would not be met and that voluntary commitments could not deliver genuine action. So the United States and other countries began to negotiate a new agreement, one with binding targets, and they agreed at the outset that these new commitments would extend only to the industrialized countries, which so far have contributed the most to the problem.

The result, negotiated 5 years after the Rio summit in Kyoto, Japan, is the Kyoto Protocol. The Protocol requires countries to reduce or limit their emissions of greenhouse gases in relation to 1990 levels, with different countries agreeing to different targets. The agreement also includes a number of features advocated by the United States to ensure countries a high degree of flexibility as they work to achieve their targets. They can make actual emission reductions at home, trade emission credits with others who have made reductions, and use "sinks" such as farms and forests to remove carbon from the atmosphere.

During the negotiations in Kyoto, Vice President Al Gore flew to the ancient Japanese capital to help hammer out the deal. And what the U.S. negotiators ultimately agreed to was a binding 7% reduction in emissions below 1990 levels by 2012.

The problem was that it was already 1997, and U.S. emissions had already risen over the 1990 levels by more than 8%. In other words, we had pledged to reduce our emissions by nearly 15% and we had neither any kind of program in place to do this nor any will to put such a program into place.

Another problem was that the U.S. Senate, under the Byrd-Hagel resolution, had recently voted unanimously that the United States should not sign any climate treaty that ''would result in serious harm to the economy of the United States'' or that did not impose some type of commitment on developing countries as well.

Of course Kyoto did not include commitments for developing countries, because the parties, including the United States, agreed at the outset that it would not. And the target agreed to by the United States was portrayed by those who wished to kill the treaty as clearly harmful to our economy, a charge that was not effectively countered by the Administration. So the fact of the matter is that the Kyoto Protocol negotiated by the Clinton administration was about as welcome in the Senate as the proverbial skunk at a lawn party - and senators had no intention of holding their noses so they could tolerate this thing. They just plain did not want it anywhere near them.

The Clinton administration, for its part, did nothing to try to bring about the ratification of this treaty that its people had made such a big deal of signing. Granted, the President at the time was caught up in a scandal, and Vice President Gore was gearing up for a presidential run of his own and surely wanted to avoid being publicly associated with anything that could be said to pose a threat to the economy. But still, the whole episode of U.S. participation in Kyoto - and, before that, the UNFCCC - was enough to recall the line from Shakespeare: "full of sound and fury, signifying nothing.'' The bottom line: we clearly were not prepared to deliver at home what we were promising abroad.

But the story does not end there. To fast forward to 2000, American voters elected another President - another Bush - and within months of entering office his administration made a unilateral decision to reject the Kyoto Protocol out of hand, instead of working to change it and make it better. Needless to say, this decision was not received warmly by other nations that had persevered through years of difficult negotiations and that had acceded to U.S. demands early on that the treaty include trading and other business-friendly mechanisms.

As an aside, I think it is interesting to note that in the recent run-up to the war in Iraq, it was hard to find an article about other countries' perceptions of the United States that did not mention the impolitic way in which this administration rejected Kyoto. It was perceived as a real slap in the face - a confirmation of global fears that the United States, which is responsible for almost one fourth of global greenhouse gas emissions, had no intention of acting seriously on this issue.

As if to confirm these fears, the Bush administration in 2002 announced a climate strategy that was big on rhetoric but not so big on results. Here is what this strategy does: it sets a voluntary "greenhouse gas intensity'' target for the nation. The idea is to reduce the ratio of greenhouse gas emissions to U.S. economic output, or GDP. But the funny thing about the White House target - an 18% reduction in greenhouse gas intensity by 2012 - is that it would allow "actual" emissions to "grow" by 12% over the same period.

What is more, the Administration's strategy relies entirely on voluntary measures. This, despite the fact that the U.S. climate policy has consisted primarily of voluntary measures for more than a decade. And what have these voluntary measures achieved? As of 2001, U.S. greenhouse gas emissions were "up" 11.9% over their 1991 levels. And so now we are more than 10 years removed from the Earth Summit, and we still - still - have no real plan in place to reduce the U.S. contribution to the problem that we and other countries identified back then as "a common concern of humankind."

The reason I have presented this history lesson is to show that, as the world has set out in the last decade to respond to the problem of climate change, the United States has been both a driver and a drag on the process -a driver in terms of development of a framework for action, a drag because we have made no serious attempt to implement that framework. We are like the boyfriend or girlfriend who says sweet things all the time but will never truly commit. And lately we are not even saying sweet things any more.

The reality is that it is long past the time for playing these sorts of games. We should have committed long ago to serious action on this issue and, having failed, it is all the more urgent that we get serious now. What does that mean? What principles should guide these efforts? I would like to offer five - five keys to success in meeting the challenge of climate change.

Key 1 is that we must forge a global response to the problem of climate change. As I have already said, the United States is responsible for one fourth of global greenhouse gas emissions. The 15 countries of the European Union are responsible for another one fourth. The remainder is divided among other developed nations and rapidly developing countries such as China and India. And, while developed countries clearly are responsible for a majority of these emissions, that will not be the case in the future, as emissions continue to grow more rapidly in developing countries than anywhere else.

It is one of the most contentious issues in the debate over global climate change - that is, the perceived divide between the interests and obligations of developed and developing countries. Equity demands that the industrialized world - the source of most past and current emissions of greenhouse gases - act first to reduce emissions. This principle is embedded in both the UNFCCC and the Kyoto Protocol, which sets binding emission targets for developed countries only. However, with the Protocol now officially entered into force, it is now time to turn our attention to what happens next. And as we do this, we need to think broadly of a framework that will include not only the countries that will be implementing the Kyoto protocol, but also the United States, Australia, and the major emitting countries in the developing world.

I do not claim to know what form this framework should take. But here is what I do know: it must be effective; over the coming decades, it must significantly reduce global emissions of greenhouse gases. It also must be fair. We must recognize who bears responsibility for climate change, and who will bear the brunt of its impacts; and we must arrive at an equitable sharing of responsibility for addressing it. That probably means different kinds of measures for different countries at different times, but all the major emitting countries must do their part. Finally, this new framework must marry our environmental goals with our economic and development objectives. In the developing world in particular, commitments that are not consistent and compatible with rising standards of living and that do not promote sustainable economic growth have little chance of success. And even in the developed world, all countries will have to be convinced that the environmental goals they agree to, the carbon limits they accept, will not impede their efforts to sustain economic growth. This will mean not only ensuring that countries are given flexibility in how they meet their goals, but also that they can turn over the existing capital stock and acquire more climate-friendly technology at prices they can afford.

This brings us to the second key to success in our efforts to address the climate issue: we need to think in terms of both short- and long-term actions. There is a great deal we can do now to reduce our emissions. At the same time, we need to be looking ahead to longer-term, and potentially more far-reaching, reductions in the years and decades to come.

At the Pew Center, we are developing a plan we call the 10/50 Solution. The idea is to think ahead to where we need to be 50 years from now if we are going to meet the challenge of climate change, and then to figure out decade by decade how to do it.

Why look 50 years out? Because achieving the necessary reductions in our greenhouse gas emissions will ultimately require innovation on a level never before seen. It will require a massive shift away from fossil fuels to climate-friendly sources of energy. And, as I said at the start of my remarks, it will require fundamental changes in how we live and work and grow our economies.

The 10/50 approach does not just look long-term, though. It recognizes that in order to realize that 50-year vision, we have to start right now. We can start with the low-hanging fruit - the countless ways we can reduce greenhouse emissions at little or no cost by simply being more efficient: everything from developing more fuel-efficient cars and trucks (including hybrids) to designing energy-efficient appliances and computers, improving industry efficiency, and enhancing management of animal wastes.

In the medium to long term, the challenge is to begin what we have called a second industrial revolution. The Pew Center is just now completing a scenario analysis that identifies several technologies as essential to our ability to create a climate-friendly energy future for the United States. These include:

1. Natural gas: Substituting natural gas for coal results in approximately half the carbon emissions per unit of energy supplied, but we need policies to encourage the expansion of natural gas supply and infrastructure.

2. Energy efficiency: We have the ability to dramatically improve the fuel economy of cars and light trucks ''right now'' and in the very near future through a combination of advances in the internal combustion engine or through hybrid electric vehicles.

3. Renewable energy and distributed generation: The potential here is enormous, but policy support will be essential in promoting investment and breaking barriers to market entry for these technologies.

4. Nuclear power: Despite its problems, the fact remains that our carbon emissions would be much higher without nuclear power.

5. Geological sequestration: Sequestration holds the potential of allowing for the continued production of energy from fossil fuels, including coal, even in the event of mandatory limits on carbon emissions.

6. Hydrogen and fuel cells: The President's recent announcement of a new federal commitment to fuel cell research was a welcome one, but we must have policies that will help pull these vehicles into the market.

Looking down this list, it is hard "not" to see that most, if not all, of these technologies would be important even in a world where we did not have this pressing obligation to reduce the amount of greenhouse gases in the atmosphere. For energy security and economic growth reasons, and a wide range of environmental reasons as well, these are simply smart things to do. The second industrial revolution is not just about responding to the challenge of climate change; it is about creating a common-sense energy future.

And, in order to create that energy future, we are going to have to keep in mind the third key to success: industry must be a partner in shaping and implementing climate solutions. The Pew Center serves as a convenor of leading businesses that are taking practical steps to reduce their contribution to the climate problem. The 38 members of our Business Environmental Leadership Council represent nearly 2.5 million employees and have combined revenues of $855 billion. They include mostly Fortune 500 firms, and they are deeply committed to climate solutions:

• There is DuPont, for example, which made a voluntary pledge to reduce its global emissions of greenhouse gases by 65% by the year 2010. And guess what? In 2002, they announced they had achieved this target "eight years ahead of schedule.'' • Also ahead of schedule in meeting its target is BP, which in 2002 announced it had reduced global greenhouse emissions by 9 million metric tons in just 4 years. This marked a 10% reduction in the company's emissions - and, like DuPont, BP had originally intended to achieve this goal in 2010.

Over the past several years, it has become clear that there are three types of companies when it comes to the issue of climate change: those that do not accept the science; those that accept the science and are working internally to reduce their contribution to the problem; and those that accept the science, are working internally, and are advocating for strong government action to address this issue.

BP, DuPont, and the other companies we are working with at the Pew Center clearly fall into this latter group. And I hope that our government -as well as other governments throughout the world - will take full advantage of their expertise and commitment.

The benefits of active involvement by industry in environmental policy making first became clear to me during negotiations on the Montreal Protocol - the agreement that set out to address the man-made threat to the Earth's protective ozone layer. An important reason for the success of that agreement, I believe, is that the companies that produced and used ozone-depleting chemicals - and that were developing substitutes for them - were very much engaged in the process. As a result, there was a factual basis and an honesty about what we could achieve, how we could achieve it, and when. And there was an acceptance on the part of industry, particularly U.S. companies, that the depletion of the ozone layer was an important problem and that multilateral action was needed.

I am happy to report that we are seeing the same kind of acceptance and determination to act on the climate issue among the companies we work with at the Pew Center. Their involvement should serve as a reminder that it is industry that will develop the technologies and the strategies that will reduce global emissions of greenhouse gases. It is industry that will have to deliver on government requirements and goals. To ignore this as we try to structure a global response to this enormous challenge is to fail.

Speaking of government, let me introduce a fourth key to success in responding to climate change: we have to adopt real, mandatory goals. Voluntary approaches, as I have said, simply have not worked to address this problem. In order to engage the full spectrum of industry and society, we need to set clear, mandatory goals for emission cuts, and at the same time provide sensible, business-friendly rules that give companies the flexibility they need to help meet those goals as cost-effectively as possible.

This is the approach embodied in recent legislation introduced by the bipartisan duo of Senators John McCain and Joe Lieberman. This landmark measure for the first time brings together several features that would be critical to the success of a national climate change strategy. The bill would establish ambitious and binding targets for reducing U.S. greenhouse gas emissions. Equally important, it would provide companies with the flexibility to reduce emissions as cost-effectively as possible - thanks to the creation of a rigorous nationwide system allowing emissions trading and providing some credit for carbon storage. Last but not least, the bill would recognize those reductions that are being made now by the companies that are taking the lead on this issue and provide additional flexibility for these early actors.

Of course, the McCain-Lieberman measure has little chance of becoming law anytime soon, but it is encouraging nonetheless to see our policy makers in Washington finally coming to grips with exactly what it is going to take to yield real progress toward a climate-friendly future. And what it is going to take is a set of real, enforceable commitments.

This leads us finally, and forgive me if this seems redundant, to the fifth key to success: the United States must be an integral part of the climate solution. Despite having 4% of the world's population, we have contributed nearly a third of worldwide emissions of greenhouse gases in the last century, and we continue to be the largest source of these emissions worldwide. And still, we have decided to sit on the sidelines while the world moves forward with a plan to begin addressing this challenge. Even worse, we have yet to develop anything resembling a domestic program to reduce our own emissions and protect the climate.

This problem, quite simply, will not be solved without us. We owe it to ourselves, we owe it to other nations, and we owe it to future generations, to commit American ingenuity and American leadership to meeting this challenge. I think the job begins at home: we must achieve a national consensus on how best to reduce our greenhouse gas emissions. And from there, we must engage constructively with other nations in the search for a lasting global solution.

So there you have it. Five keys to success: we need to address this issue globally. We need to think and act both short-term and long-term. We need to involve industry. We need mandatory goals. And we need the United States to do its part both at home and abroad.


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