Carmen Bunzl - Universidad Pontificia Comillas

Chapter 2. Options for future climate change architectures 47
advanced in their development and where the emissions are well correlated
with GDP. In some developing countries the direct relationship is not always
apparent, thus increasing uncertainty. For example, Argentina offered a
voluntary target indexed to GDP (it related emissions to the square root of
GDP) in 1999, where a 1% increase in GDP would allow a 0.5% increase in
emissions; this was due to the fact that agriculture contributes significantly to
emissions, but less significantly to the national GDP.
When the USA rejected its Kyoto target in 2001, it suggested an intensity
target as alternative, aiming to reduce its intensity by 18% in 10 years – a 3%
annual increase of the GDP would mean a 10% increase in absolute emissions
over the 10 years. However, it is unlikely that they would accept an intensity
target as stringent as their Kyoto target.
The EU, Japan and other developed countries may accept this type of
commitment if set at a sufficiently stringent level.
Intensity targets can be environmentally effective if set at sufficient stringent
levels, although the ultimate outcome remains uncertain due to the link of the
unknown growth of the GDP. When combined with emission trading, their
economic efficiency is high, but less than for absolute targets, as the final level
of emission allowances is not known. Equity concerns are accommodated by
the selection of the countries and the stringency of their commitments. As with
absolute targets, the technical feasibility depends on the institutional
circumstances in the country; anyhow, a great amount of data is needed to
assure the compliance of the target. Setting intensity targets involves additional
knowledge about the relation between emissions and GDP.
2.1.1.3 No-lose targets
Emission rights can be sold is the target is overachieved, but none have to be
bought if it is not reached (see Philibert, 2000). This way, this type of targets can
only have advantages but no disadvantages for the country.
Escuela Técnica Superior de Ingeniería ICAI Carmen Bunzl Boulet Junio 2008