Don’t let West carry carbon burden, urge firms

Tricia Holly Davis in Copenhagen
BUSINESS leaders at the United Nations climate-change summit in Copenhagen are pushing European nations not to bow to pressure from developing nations to increase targets for greenhouse-gas cuts.
Executives at the summit say firms will be left at a competitive disadvantage if the European Union forces industry to slash emissions while competitors in China and India are given more leeway.
Business Europe, an industry lobby group, has warned against raising the target to cut greenhouse-gas emissions from 20% to 30% unless rival economies also commit themselves to similar targets. China has agreed to cut its emissions per unit of economic output 40% over the next decade, but this is not the same as actually limiting pollution.
“In the absence of a global agreement, the EU must not increase in any way its current carbon-reduction requirement,” said Business Europe.
This has infuriated green-interest groups. Oxfam has called on the CBI to dissociate itself publicly from Business Europe. The CBI said, however, that it agreed with Business Europe’s view. “It may be right to move to a 30% emissions cut, but the challenge is bringing other countries to match that level of ambition,” said the CBI’s Neil Bentley.
Progress in negotiations in the first week of the two-week event was painfully slow.
A draft agreement that proposes cutting global emissions roughly in half by 2050 emerged on Friday, but it contained no detail on the crucial question of how much rich nations would give to poorer countries to help them tackle climate change.
Delegates from developed nations welcomed the draft, but warned that they thought it was too soft on developing countries.
At a separate meeting in Brussels, European leaders agreed to pay $10.5 billion (£6.5 billion) over the next three years to help emerging economies, a move that they said should help to clinch a deal at Copenhagen.
The pace of the talks is expected to pick up this week, when many world leaders, including Gordon Brown and Barack Obama, arrive. The summit concludes on Friday.
Business leaders at the event said they had struggled to exert any influence on the main talks, taking place at the Bella conference centre. Most of the business events at the summit are being held at a separate location, and executives said the business lobby was divided on key issues.
“It’s difficult to imagine one voice [to speak for business],” said Jim Rogers, the chief executive of Duke Energy, the American utility group. “In truth, there are many voices.”
Global institutions, however, are using the event to try to thrash out side agreements on how business will pay for the shift to low-carbon technology. The World Bank, for example, on Thursday summoned business representatives to a low-profile meeting at a conference room at the Copenhagen opera house.
Businesses also see Copenhagen as a giant trade fair and networking event.
A former American climate-change negotiator who now runs a consultancy that advises firms on how to tap into the £3 trillion global low-carbon technology market said businesses were at the talks to make deals. “Really, this is just a great convention for businesses to meet customers. The policy part is almost a sideshow.”
Money is the barrier to progress in the main talks. Developing countries want the industrialised nations to pay for low-carbon technologies that will help nations such as China and India grow their economies in a sustainable way.
The International Energy Agency forecasts that by 2030 $15 trillion will have to be spent to move from fossil-fuel power to low-carbon sources.
Steve Sawyer, who represents the interests of business on the World Bank’s clean technology fund committee, said business would be responsible for 75%-90% of these costs. The fund was established last year to test low-carbon technologies and act as a demonstration project for the Copenhagen negotiations to show how rich nations could sponsor low-carbon projects in emerging economies.
The fund is now worth $5 billion — nearly equivalent to the entire finance package being offered by the EU delegation in Copenhagen to pay for green energy projects in developing nations. Sawyer said the World Bank’s intention was to use the fund to attract investment from businesses of up to $100 billion over the next decade.
“Whatever comes out of Copenhagen, ultimately it is businesses that will pay most of the costs, but if governments are going to get business to invest then they should be testing these technologies in the markets where they have the most commercial opportunities,” he said.
“We should be investing in projects where it makes economic sense to get these technologies to scale and then give them to developing countries.”
Martin Powell of the London Development Agency, the mayor’s economic development arm, agreed. “The climate-change negotiations shouldn’t just be about giving money to poorer nations. They should be about making the most efficient use of that money,” he said.