introduction climate change and emissions trading

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Climate ChangeHenk Harmsen

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What we know

• How global warming works• Early warning signs• What might happen

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Source: Carbon Dioxide Research Group, Scripps Institute of Oceanography

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How global warming works

240 W/m2 240 240 236 240 240

Equilibrium15 °C

CO2 * 215 °C

CO2 * 215 °C + 2.5 °C

Source: Global Warming, Houghton, 2004

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The Carbon Cycle

Land 2500 Oceans 39000

Atmosphere 760 + 3.3

uptake 0.7

uptake 2.3

fossil fuels & carbonates 6.3

All nrs. in Gt

Source: Global Warming, Houghton, 2004

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Signs of climate change

Average temperature increased + 0.6 °C over 20th century

More heavy rain events

Higher frequency and intensity of droughts

Global mean sea level + 1-2 mm/yearSnow cover decrease 10%Arctic ice thinned by 40%

Source: Global Warming, Houghton, 2004

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Trouble brewing

• The Keeling curve• Breathing of the planet• pre industrial 280 ppm

Source: Grid Arendal/UNEP, Vital Climate Change Graphics

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What is being done

• Climate change policies• Emissions trading• Policy regions

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Quotes

"If you think mitigated climate change is expensive, try unmitigated climate change.“Dr. Richard Gammon, University of Washington, on the steps of the US Congress, June 28, 1999

"First, we would not accept a treaty that would not have been ratified, nor a treaty that I thought made sense for the country.“GW Bush on the Kyoto accord in an interview with the Washington Post, April 24, 2001

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“Recent” problem

1994 1996 2004 2006 2008 2010 201220022000199819921990

“planetseems to be warming”

Earth Summit& UNFCCC

“discernable human

influence”

Kyoto Protocol

“scientific evidence”

Kyoto Protocol enters into force

Kyoto Protocol

Bronnen: IPCC 1st, 2nd, 3rd and 4th Assessment Reports

“Warming of the climate system is unequivocal”

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Legal frameworks

United Framework Convention on Climate ChangeStabilize GHG emission at 1990 levels by 2000

Kyoto ProtocolReduce GHG emissions with average 5% during the period 2008-2012 [compared to 1990 levels]

European UnionMandatory CO2 emissions trading for +/- 11000 installations

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How emissions trading works (cap & trade)

EmissionsMonitor & Verify

AllowancesAllocate

Buyallowances

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European Emissions Trading [EU ETS]

Emissions+/- 2100 Mt CO2

Allocation+/- 2191 Mt CO2

Emission permitVerification

+/- 11000 installations covered. CO2 price: 15 – 20 eur/ton

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How emissions trading works (baseline & credit)

BaselineValidate

Project emissionsMonitor & verify

Issue credits

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Climate policy regions

European emissions trading

Regional initiatives

Regional initiatives

CDM projects

Big Kyoto gap

Big Kyoto surplus

Kyoto gap

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Consequences for business?

70% of business see both risks and opportunities related to climate change [source: www.cdproject.net]

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FT500 Climate change actions

79%74%

47%41%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Allocatedmanagementresponsibility

Disclosure ofemissions data

Emissionreductions

Emission targets

Source: www.cdproject.net

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Tips for doing nothing

• We don’t know enough• The goal is not clear• Developing countries have no reduction target

Source: G.W. Bush, White House

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Better to act now

• Scientific evidence• Precautionary principle• Link with energy policy

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Source: Grid Arendal/UNEP, Vital Climate Change Graphics

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Financial impact

“…we will quantify the financial cost of greenhouse gas emissions and integrate them into financial analysis of the transaction.”JP Morgan, corporate policy

Munich Re may “…adapt verified forecasts of climate change into the company’s business decisions.”Munich Re, response Carbon Disclosure Project

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We are in the same boat

"This is by far the most serious challenge that we face or have ever faced. None of the other ones will matter if we don't get this right.“

Al Gore

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More information

www.ipcc.chwww.unfccc.int

www.cdproject.netwww.wri.org

www.pewclimate.orgwww.ghgprotocol.org

www.pointcarbon.comwww.carbonneutral.com

http://ec.europa.eu/environment/climat/emission/mrg_en.htm

http://magma.nationalgeographic.com/ngm/0409/

Scientific researchKyoto Protocol, JI, CDMCarbon Disclosure ProjectClimate change dataPolicy briefingsMeasuring GHG emissionsNewsBecome carbon neutralEmissions Trading in Europe

National Geographic special

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Henk Harmsenhenk@carbonmetrics.comwww.carbonmetrics.com

http://creativecommons.org/licenses/by-nc/2.5/