CLIMATE POLICY: AMERICANS DO IT BETTER

Istituto Bruno Leoni
 HYPERLINK "http://brunoleoni.servingfreedom.net/BP/IBL_BP_28_Stagnaro_Sechi_en.pdf" \t "linkWin" http://brunoleoni.servingfreedom.net/BP/IBL_BP_28_Stagnaro_Sechi_en.pdf

by Mario Sechi & Carlo Stagnaro

KEY FINDINGS

* The Kyoto Protocol is an ineffective instrument to face the challenge of climate change
* The European Union will be unable to meet its targets under Kyoto
* More attention must be given to fast-growing, emerging economies
* A sensible climate agreement needs to be based on co-operation between developed and
  developing countries
* The issue lies not in curbing development, as instead in encouraging a cleaner development
* Climate policies are closely linked to energy and foreign policy
* The weakness of the European energy policy calls for the search of alternatives compatible
  with a stable geopolitical scene
* The proper course is the one outlined in Gleneagles and implemented in the Asia and Pacific
  Partnership on Clean Development
* Italy should leave the fruitless European course to joun the US-led Partnership

While assessing trends and projections of greenhouse gas emissions, the European Environmental Agency (EEA) warns that the 15 "core" EU countries will be unable to meet their commitments under the Kyoto Protocol. Against a commitment to reduce greenhouse gas emissions by 8 per cent below 1990's levels, "Existing domestic policies and measures will reduce total EU-15 greenhouse gas emissions by only 1.6 % from base-year levels by 2010."

However, further states the EEA, achieving the desired goal is still possible: "When the additional domestic policies and measures being planned by Member States are taken into account, an EU-15 emissions reduction of 6.8 % is projected. However, this relies on several Member States cutting emissions by more than is required to meet their national targets, which cannot be taken for granted. The projected use of Kyoto mechanisms by nine Member States will reduce emissions by 2010 by a further 2.5 %." (emphasis added) The current circumstances, the unfavourable economic predicament, the fuzziness of the required "additional measures," and the inherent awkwardness of a strategy predicated on a generous and undue effort by some countries to offset the failings of the laggards make quite unlikely that Europe can even begin to come close to its commitments under Kyoto.

[...]

Climate change is both a challenge and an opportunity. The current state of scientific knowledge cannot satisfactorily explain what is happening in the Earth's atmosphere, let alone identify the causes with any degree of certainty. Moreover, the rising temperatures will have a different impact from place to place. If, as it seems likely, warming is going to be stronger in the colder regions of the planet, it might produce benefits as well as costs.

In view of the complexity of the climate scenarios, the Kyoto Protocol-underpinned by unproven scientific assumptions and by a strategy that is in all likelihood ineffective and most certainly costly-is unlikely to be equal to the task of capturing the many facet of the problem. Further, by diverting resources to different uses, Kyoto threatens to close off the most promising technologies' developmental paths.

Under this respect, the Asia & Pacific Partnership on Clean Development and Climate is based on a completely different-albeit not incompatible - paradigm (Japan, for instance, participates in the Partnership, but is also committed to Kyoto). Innovation, international co-operation and free market are the keywords for a proper understand of the new initiative. Moreover, the geopolitical events suggest the advisability for the developed countries to devise common energy policies that cannot disregard the development of shared and sensible climate policies.

Italy, in common with the rest of Europe, is bound to Kyoto. Unfortunately the making of our energy system makes meeting the targets set by the protocol an unlikely-not to say impossible-goal. Nuclear energy - the only emission-free and competitive energy source-was unaccountably rejected in a referendum held in 1987: Italy's energy mix is thus heavily biased towards fossil fuels. The traditionally high level of energy taxes contributed to make consumption unusually efficient, which in its turn makes the unit cost of emissions reduction among the highest in the Continent.

If Italy is the part of Europe that most feels the impact of Kyoto, it is likewise the country that-for a number of different reasons-is more in tune with America. In the recent years Washington found in Rome an attentive and often responsive partner. This might enable Italy to start a domino capable of breaking the spell that keeps all the EU's Member States - even against their interests-in thrall of Kyoto, often for sheer political ornery (although more concrete interests also play a role). The road from Gleneagles to Sydney makes more sense for Italy than the one leading from Brussels to Kyoto. In applying for admission to the Washington-led Partnership, Italy might trigger a shake-up of environmental policies, encouraging a shift from a ideological and statist approach to a pragmatic and market-oriented one.

Such a choice could not be charged of being senseless or devoid of economic and environmental benefits, but it would require boldness and steadfastness to face down the inevitable opposition, particularly within the European Union. In the long-term, however, the other EU countries might be thankful if Italy succeeded to cause a quantum jump in the quality and rationality of climate policies.

The forthcoming government will be at a crossroads: on one hand, it will have the opportunity to revolutionize European climate policies, on the other it might supinely accept to walk the easy but treacherous road to Kyoto. For sure, it is unclear where the narrow way that started in Sydney may ultimately lead, but we all know where the road paved with good intentions ends.

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