The 21st Century climate challenge

Box 3.3The United Kingdom's climate change bill—setting a carbon budget (continued)3Avoiding dangerous climate change: strategies for mitigationThe Renewables Obligation, a regulatory instrument, stipulatesthe amount of electricity that power suppliers have to accessfrom renewable sources. It has achieved mixed results. The currenttarget is for the share of renewables to reach 10 percentby 2010, rising to 15 percent by 2015. However, current trendsfall far short of these targets, and shorter still of the EuropeanUnion’s 20 percent target by 2020. If Britain is to achieve itsown stated goals, it will need to accelerate the development ofwind and tidal power. One option would be a system of renewablessupport modelled on the German feed-in tariff system,with stronger price incentives backed by public investment.• Cutting emissions from transport. Taxation and regulationare mutually reinforcing instruments for cutting transportemissions. Increased taxation on petrol is one demandmanagement mechanism. More broadly, vehicle excise dutiescould be adjusted, with a steeper graduation to refl ect thehigher CO 2emissions associated with low fuel-effi ciencyvehicles, especially sports utility vehicles. The national carbonbudget could establish ‘carbon pricing’ in vehicle taxation asa source of revenue for investment in renewable energy, withvehicle tax registration for all new cars after 2010 graduatedto refl ect more stringent pricing on CO 2emissions. Risingemissions from transport also reflect weaknesses in the publictransport infrastructure and a decline in the cost of privatetransport relative to public transport.• The residential sector. Energy use in the residential sectorremains highly ineffi cient. An average existing home requiresfour times as much energy to heat as a new home. Around onethirdof the homes that will be occupied in 2050 are yet to bebuilt. With adoption and implementation of the best EuropeanUnion standards, this represents an opportunity for deep cutsin emissions.Setting the right targets is the starting point for sustainable carbonbudgeting. Ultimately though, governments have to be judged onpolicies and outcomes. Impressive inflation targets count for little inthe face of uncontrolled money supply. The same applies to climatechange targets. The challenge for the United Kingdom is to align amore stringent target with wide-ranging energy policy reform.Source: Anderson and Bowes 2007; Government of the United Kingdom 2006b, 2006c, 2007b, 2007c, 2007e; Seager and Milner 2007.However, faced with a threat on the scale posedby climate change, voluntarism cannot substitutefor effective state action.Developed countries that have not ratifiedthe Kyoto Protocol have relied on voluntarytargets. The only Federal target in the UnitedStates is the (non-binding) emissions intensitytarget. Other flagship programmes—such asthe Combined Heat and Power Partnership andthe Clean Energy–Environment State Partnership—attemptto encourage voluntary reductionsby the corporate sector. In Australia, the nationalclimate change strategy does have a non-bindingtarget: emission cuts of 87 Mt CO 2by 2010. 21Voluntary measures, such as consumer educationand engagement with the private sector, are theprimary mechanism for achieving the objective.Outcomes have not been encouraging.The centrepiece of the voluntary programmein Australia is the Greenhouse ChallengePlus (GCP) initiative. Participating companiesare required to develop and publishcompany-level greenhouse gas inventories andstrategies for cutting emissions. The GCP hasplayed an important role in informing publicdebate and many participating companieshave adopted innovative strategies for cuttingemissions. However, Australia’s overall greenhousegas emissions in 2004, not includingland-use change, were 25 percent above 1990levels. 22 Emissions of CO 2from energy wereup by one-third and by 16 percent for industrialprocesses. 23 Voluntarism is clearly notdelivering the required outcome.Recognition of this fact has promptedseveral state and territory governments toargue for a national programme for mandatoryemissions cuts to supplement voluntary efforts.One prominent example is New South Wales,which has set a target of reducing greenhousegas emissions by 60 percent by 2050. 24 More immediately,state legislation passed in 2002 aimsto cut emissions per capita from the productionand use of electricity from 8.6 tonnes to 7.3tonnes between 2003 and 2007—a reductionof 5 percent against the Kyoto Protocol threshold.25 The Greenhouse Gas Abatement Schemesets annual statewide greenhouse gas reductiontargets, and then requires individual electricityretailers to meet mandatory benchmarks basedon the size of their share of the electricity market.26 As in the United States, this is an exampleof political leadership on climate change frombelow.122 HUMAN DEVELOPMENT REPORT 2007/2008