Staying ahead of the game

Climate change has been top of the agenda once again in the past few weeks. A Eurobarometer survey of 27,000 citizens across the EU-27 found it to be the issue that most concerned them by a long shot. Nearly 60 per cent of Europe’s citizens identified it as a primary environmental concern. Only 45 per cent of respondents in the EU-25 had done so in 2004, ranking it below water pollution and man-made disasters. In the 2002 questionnaire, when EU-15 respondents were asked whether climate change concerned them, 27 per cent said no.
European leaders meeting in Brussels for their spring summit in mid-March were also preoccupied with carbon emissions. But this time their focus was on the effect they may have on European industry rather than its climate. A number of member states, led by Europe’s manufacturing powerhouse, Germany, have warned that the danger of energy-intensive industries choosing to relocate to regions where carbon has no price or is very cheap –
so-called carbon leakage – is very real.
The European commission has positioned itself as a stalwart of European industry interests. President José Manuel Barroso said after the summit that a revised EU emissions trading scheme “will include clear safeguards” against carbon leakage. But the EU executive is also keen to keep the wider picture in view. Mr Barroso made it clear there would be no one-sided attempts by the EU to tackle this issue before 2010. This is to allow for international climate talks to hopefully provide before then a satisfactory answer to those concerns.
Carbon leakage featured prominently at a carbon conference held in Copenhagen by Point Carbon on 11-13 March. Another leading topic was carbon credits, especially those deriving from the clean development mechanism (CDM), which allows rich countries to gain credits from reducing carbon emissions in poorer regions.
The United Nations’ Yvo de Boer launched into a strong defence of CDM. He urged the commission to review plans to limit it. The CDM should instead be revised to attract a greater flow of funds to developing countries, he said.
Another theme dominating carbon conversations of late is the acknowledgement that the US is catching up with the concept of carbon and its markets. Analysts from New York-based New Carbon Finance have predicted that the US “will be home to a $1 trillion (€632bn) carbon trading market” by 2020.
In a new, carbon-conscious US, analysts expect major investments “in renewable energy, energy efficiency, and greenhouse gas mitigation projects and technologies”. If such a prediction proves correct, the global picture for “green technologies” may change dramatically.
The home of the Kyoto protocol, Japan, was one of the early environmental technology innovators. From energy-efficient lighting to low-emission vehicles and domestic photovoltaic systems, “for much of the last decade, the government of Japan has identified scientific and technology innovation as being the key element in defining the country’s long-term economic prospects”, says a recent study by Canada’s Centre for International Governance Innovation.
When the US finally decides to throw its weight into this contest, it will be interesting to see which mix of regulation, markets, governance and business initiative will prevail.
For Europe, the message is clear: technological innovation is at the heart of the carbon revolution. Policy and business leaders should move fast to harness it or ignore it at their – and our – peril.
Nadia Weekes, editor

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