Report from "China and Global Climate Change" Conference at Lingnan University, Hong Kong

CGS has been in Hong Kong this week as a participant in the "China and Global Climate Change" conference at Lingnan University. The conference has been remarkable in the range of perspectives represented, including everything from psychology to meteorology to social theorists. As one of the few academic gatherings with a specific focus on China and climate change, CGS strongly recommends checking out the conference website for access to the proceedings.

A few things of particular note:

First, many of those focusing on China's participation in global climate negotiations were pessimistic, primarily because there is a great deal of scepticism that the goals of fairness (i.e., accounting for the West's historic emissions) can be reconciled with the ecological imperative of preventing severe climate change. One political theorist (papers are currently not for attribution- sorry!) suggested that this situation should compel Western countries to take a hard line with China and other developing nations, essentially jettisoning the fairness consideration in favor of taking punitive measures, such as carbon tariffs, on imports from countries which refuse to participate in global efforts to reduce emissions.

Second, assessments of localized climate impacts appear to grow only more complex. One, particularly thorough study of climate change impacts on food security suggested that when all factors are considered, including socio-economic and water availability changes, food production is likely to remain largely unchanged under most IPCC climate scenarios. However, local impacts will be likely to vary tremendously, and expensive adaptation will likely be required to mitigate negative climate impacts on agriculture.

Third, more attention needs to be paid to changing consumption patterns in China, especially in the longer run. This will include buying fewer new-use products, low-emission buildings, hybrid-electric vehicles and bikes, and generally building more sustainable cities (in this vein, it's welcome news that China will build 19 urban railways by 2015). Such an emphasis on low-carbon lifestyles will be a big shift from the government's current, production-side focus on reducing energy and resource consumption (the Circular Economy concept). NGOs may therefore have to play a crucial role.

To CGS, the conference reinforced the point that climate negotiations with China will come down to two things: how clean technology is transferred to China, and how adaptation efforts are financed. The first part will likely require innovative licensing arrangements for technology developed in the US but produced in China, and Congress won't like that very much. The second goal will likely need to be focused on agriculture and rural development.

Report from Stern's visit to Beijing

Todd Stern and a US climate cooperation delegation made an appearance at a roundtable discussion at Tsinghua University today, which CGS weaseled itself into. It was "off the record," so to to maintain whatever journalistic integrity it has, CGS will only refer to general comments and threads of discussion (Chatham House rules).

With one exception, a really good, but unattributable quote: "We are mindful of the unforgiving imperative of the atmosphere." Well, CGS for one will sleep a little better knowing that.

Unfortunately, the rules of the game haven't changed: China still emphasizes the need for growth and development, while the US side slowly chips away at China's protests that it is a developing country, noting that China cannot claim to be as helpless in the face of climate change as, say, Haiti.

However, the roundtable did come closer to identifying a key negotiating front than previous sessions: technology cooperation. The Chinese side, possibly because it was dominated by representatives of the energy and engineering bureaucracy, constantly called for technology transfer. The US side forthrightly said that the United States has neither the monetary resources nor the political will to finance China's clean energy transformation: it can purchase the technology on the open market. What's needed, they said, is closer to an equitable (presumably meaning the US won't pay) "technology cooperation" arrangement.

A possible foundation for compromise emerged when Chinese representatives responded by saying that the US can do more to promote development of technologies that meet China's needs as a developing country, something most feasibly done through private-sector partnerships. Governments, meanwhile, can collaborate on enhancing China's capacity for clean technology deployment and implementation, especially in the area of measuring, verifying, and reporting emissions.

That might be something Congress can live with. But one big hurdle remains, and one recognized by both sides: intellectual property (IP). Both sides noted that there's a lot of misunderstanding on this issue, that China is actually better on some IP issues than it's given credit for, and that there's a whole range of technologies, mostly in energy efficiency, where IP issues are not a significant impediment.

So long and short, a focus of continued negotiations should be on capacity building in technology transfer, not simply discussion of the transfer and financing itself. To offer some CGS commentary, the Chinese side didn't seem to be budging much, but that's understandable: at a minimum, the US has to pass domestic cap and trade legislation before China can be expected to make any concessions. But you do have to take a step back and think: a bunch of earnest, capable people all speaking frankly about the importance of US-China climate cooperation for the future of the world. That would have been almost unimaginable a year ago.

Mr. Stern goes to Beijing

Todd Stern, the chief American climate negotiator, arrived yesterday in Beijing for talks meant to pave the way for Copenhagen. The New York Times quoted Congressman Edward Markey, co-sponsor of the American Clean Energy and Security Act, who recently returned from a Beijing trip, as saying, "This is going to be one of the most complex diplomatic negotiations in the history of the world."

It's not too much hyperbole to go even further and say it will also be one of the most important, determining a great deal of the ecological fate of the world this century. Given this importance, what China says and does between Stern's visit and the negotiations at Copenhagen will also signal a great deal about what kind of country China really is, and what kind of power it aspires to become. If it offers sensible concessions and true partnership to the United States, we can be reassured that China wants to buy into a rules-based global order, in which there is a strong presumption of common interest. It would also speak well of China's technocratic regime (though it will be, and should be, forever in the shadow of Mao's totalitarianism and Tiannanmen). If, on the other hand, China sticks to its current talking points, which offer no concrete emissions reduction and continue to blame the West for climate change, we can all grow a lot more concerned about the future of international cooperation.

(See also Julian Wong's excellent summary of what China has done to date on climate change).

Climate change as a security issue for China

CGS has been absent for the last month, having been caught on the wrong side of China's Great Firewall (The twentieth anniversary of the Tiananmen Square massacre was Thursday). CGS has also been working on a paper entitled "Climate Change, Water, and China's National Security," to be presented at a conference in Hong Kong later this month.

Here's what CGS learned and concluded:

China and its neighboring countries are in for several acute water-related impacts as a result of climate change. Some areas of northwest China and eastern India will face severe irrigation challenges as water availability from Himalayan glacial meltwater decreases precipitously by the end of the century. Second, arid regions of China, especially the north, will become even drier. Third, south China and the Mekong delta will come under severe risk of catastrophic flooding. Essentially, most parts of China will have too little water when they need it (the dry season), and too much when they don't (the wet season).

China is fortunate in that it is wealthy enough that it can adapt to many of the worst consequences of these climactic changes. It can build dams and flood control infrastructure to store water and prevent destructive flooding, and it can invest in massive schemes like the South-North Water Transfer project to redress regional water shortages. Even if water shortages threaten crop production in China's breadbasket northern regions, China is wealthy enough that it can import much greater amounts of food.

What is clear is that water-related climate impacts will stress social and political institutions. Yes, China can invest in adaptation, but it will be expensive. Government agencies and the military will be harder pressed to develop response capabilities to water shortages. Meanwhile, water shortages threaten social stability in fragile areas of China, especially Xinjiang. Finally, water issues will become a more prominent feature of China's foreign relations, for which it is currently unprepared and inexperienced.

Climate change does not (obviously) threaten China's security in the same way that Soviet Russia once did, or that (according to the censors...) Twitter does today (it has been blocked for weeks). Rather, it will be an acute stress factor for social and political actors. Add in the many other such stressors (income inequality, economic hardship, political illiberalism, etc), and China will be compelled to pay more attention to climate impacts in the coming years.

Of course, and this is important on the eve of the US climate envoy's visit to China, China wouldn't have to worry so much if it commits to reduce its GHG emissions at Copenhagen this December. CGS believes the enduring value of seeing climate as a strategic issue for China is that it can help compel Beijing to see that climate change will stress China's social and political foundations, and is not simply an economic or ecological issue. Many of the government's great projects, such as the Western Development Project (Xibu da kaifa) will be greatly imperiled by climate impacts.

On an only partially related note:

A brief word on the climate negotiations: I've recently been in several fora where I've gotten into arguments about the necessity of China accepting firm commitments, and it's just this simple: China is too big for it to be an X factor in the global climate equation. Any formula the negotiators come up with in Copenhagen is meaningless unless China's contribution is codified.

CGS knows it's preaching to the choir here, but had to get that off its chest.

Getting Serious on Climate: the American Clean Energy and Security Act of 2009

Early last month, the US House of Representatives released a public summary of the American Clean Energy and Security Act of 2009 (CGS is a little behind on this, but better late than never!). The Act, abbreviated ACESA, is important to US-China climate cooperation for several reasons. The first of these is obvious: with wide-ranging provisions to ramp up energy efficiency and introduce a domestic cap-and-trade system for carbon dioxide, it's America's first serious attempt to reduce its national greenhouse gas emissions to responsible levels. Second, the Act includes several far-sighted provisions for international cooperation, several of which bear specifically on China.

First, a survey of the Act's most revolutionary and hard-hitting provisions. For starters, the Act requires that retail electricity providers obtain 25% of their energy from renewable sources, a far higher share than at present. It also envisions the creation of a "smart grid" to efficiently distribute electricity, which would represent the largest investment in America's energy infrastructure since rural electrification programs in the 1930s. A provision to enable federal agencies to negotiate purchases of renewable energy could potentially have far-reaching impacts; if, for example, the Department of Interior were to do so, it could stimulate rural renewable sources, since many Interior facilities are located in America's heartland.

By far the most eye-catching part of ACESA, however, is its cap and trade system:

The draft establishes a market-based program for reducing global warming pollution from electric utilities, oil companies, large industrial sources, and other covered entities that collectively are responsible for 85% of U.S. global warming emissions. Under this program, covered entities must have tradable federal permits, called “allowances,” for each ton of pollution emitted into the atmosphere. Entities that emit less than 25,000 tons per year of CO2 equivalent are not covered by this program. The program reduces the number of available allowances issued each year to ensure that aggregate emissions from the covered entities are reduced by 3% below 2005 levels in 2012, 20% below 2005 levels in 2020, 42% below 2005 levels in 2030, and 83% below 2005 levels in 2050.

The biggest implication of this provision is that, if adopted, there will be no major industrialized country without serious legislation in place to dramatically reduce carbon dioxide emissions. This will inevitably shift the focus towards the world's emerging emissions superpowers, India and China.

Some smaller provisions, if taken to scale, may also have implications for China: ACESA suggests that substantial resources will be devoted to investing in carbon capture and storage (CCS), improving building and appliance energy efficiency, and greening the transport sector. All of these are areas in which American technical knowledge can be profitably employed in China. One provision though is certain to anger China: a stipulation that

To ensure that U.S. manufacturers are not put at a disadvantage relative to overseas competitors, the draft authorizes companies in certain industrial sectors to receive “rebates” to compensate for additional costs incurred under the program. Sectors that use large amounts of energy, and produce commodities that are traded globally, would be eligible for the rebates. If the President finds that the rebate provisions do not sufficiently correct competitive imbalances, the President is directed to establish a “border adjustment” program. Under that program, foreign manufacturers and importers would be required to pay for and hold special allowances to “cover” the carbon contained in U.S.-bound products.

Apart from these articles, though, are specific provisions that address international cooperation. At the international level, experts (and the Bali Roadmap) have long stressed addressing both mitigation and adaptation. ACESA has learned this lesson, and includes a section directing the National Oceanographic and Atmospheric Administration to create a National Climate Service, and each federal agency to conduct a review of climate adaptation issues. Even more importantly, however, it also "creates an International Climate Change Adaptation Program within USAID to provide U.S. assistance to the most vulnerable developing countries for adaptation to climate change."

Finally, and most significantly for China, ACESA also includes a provision

to provide U.S. assistance to encourage widespread deployment of clean technologies to developing countries. The draft specifies that only developing countries that have ratified an international treaty and undertaken nationally appropriate mitigation activities that achieve substantial greenhouse gas reductions are eligible for funding.

This language, with its stipulation that recipients of clean technology assistance ratify an emissions-mitigation treaty, seems aimed directly at India and China.

In sum, then, ACESA represents a great leap forward for the US on climate change issues. First, if adopted and implemented fully, it promises to shift the political burden for reducing emissions more resolutely on the developing world, within which China is the biggest target. The adaptation fund provision, if (and it's a big if) fully funded, could help the US to diplomatically isolate China and other big-country emitters from their allies in the more impoverished developing world, thereby increasing leverage for China and India to agree to concrete measures to reduce their emissions. Second, it includes several provisions that lay the groundwork for effective US-China cooperation on the development and deployment of clean technologies at a large scale.

Sadly, there are also significant pitfalls for ACESA acting as a catalyst for greater US-China climate cooperation. First, the "climate protectionist" provision of the bill will almost certainly raise China's ire, and will probably provoke retaliatory measures if it is passed by Congress. In the long run, such protectionism will damage technology cooperation efforts, to the benefit of no one. Second, and most damagingly, it looks like ACESA will require significant watering-down to secure passage through Congress. As The New York Times has reported, the bill faces significant opposition from conservative Democrats and Republicans, especially in these jobs-hemorrhaging times.

Nonetheless, ACESA demonstrates that the pendulum is swinging towards action on climate in America, and that means it will be a bigger issue for China, too. The future for US-China climate cooperation remains brighter than it has ever been. What remains unclear is if it will actually outshine the many dark clouds that the threat of climate change continue to cast over China, America, and the world at large.

Planning for Smart Growth

CGS is returning from a long absence, much of which was spent researching developments in the United Arab Emirates, which due to its oil reserves and carbon-intensive model of development is of great importance to the global environment. The thing that most blew CGS away, however, is Abu Dhabi's Sufrace Transport Masterplan. The plan envisions moving up to 50,000 people every two minutes, using a visionary combination of heavy and light rail, bus, traffic demand management, and transit-oriented development. The scale of the plan is astounding, not least because it entails creating one of the world's most extensive transport networks essentially from scratch by 2030.

China would do well to study it. The country may not have the Emirate's per-capita wealth (this courtesy of the country's oil reserves), but China does face a similar trend of urban population growth. Sustainable transport strategies, along with smart urban planning, will be crucial to easing (and greening) China's rapid transition to becoming an urban nation.

A recent article by Energy Foundation analyst Felix Creutzig in China Dialogue provides some indication of the imperative for smart growth. According to his analysis, the cost of congestion in the capital (Beijing has some 3.6 million cars) and air polluion amont to 7.5% of Beijing's GDP, excluding the high cost of vehicle emission contributions to climate change.

Creutzig offers a number of recommendations, including the building of satellite towns with transit-oriented development and the implementation of congestion pricing. Indeed, Beijing already has a few good examples of smart planning: the Xizhimen transport hub, for example, pretty successfully integrates long-distance rail, urban rail, and bus links with a large commercial complex and nearby residential areas.

Smart growth will not, of course, solve China's (or the world's) climate problems, but it makes sense for many other reasons, not the least of which is economic, as Creutzig shows. Moreover, smart growth maximizes co-benefits from reducing air pollution and congestion.

The principal impediment to promoting smart growth in China is the chaotic nature of local government. Beijing is in a better position than most, since it is a "municipality" that integrates local and provincial government. But for smart growth to take hold, the creation of multi-jurisditcional, regional planning organizations could be a big help.

Co-authored editorial with Julian Wong of Green Leap Forward

Readers of this blog will be familiar with the argument that a bolder, more aggressive stance on climate change will benefit China in a great many ways. The following is a hopefully more persuasive version of that argument, co-authored with Julian Wong of The Green Leap Forward, and published in last week's China Daily:

The year 2009 may well be remembered as the Year of Climate Cooperation. Shortly after the New Year, the inauguration of Barack Obama heralded a new effort to reduce America's greenhouse gas emissions, and to place special emphasis on working with China on climate issues. In a few more months, the world's nations will gather in Copenhagen, Denmark, to try to forge a global agreement to prevent catastrophic climate change.

The tide of history is shifting towards a belated but crucial effort to reduce global greenhouse gas emissions. China has a uniquely important opportunity to help shape this momentous new chapter in history, one that can be grasped by taking a new look at its national policy on climate change.

The Chinese government's 2008 "White Paper on China's Policies and Actions on Climate Change," together with the 2007 National Climate Change Program, outlines substantial efforts to improve energy efficiency and reduce emissions. China has an opportunity to build on this effort by formulating a visionary policy that will enhance its national security, promote sustainable economic development and position it as a full partner in one of the most important global efforts of our era.

A visionary national climate change policy should be forward-thinking - too much time has been wasted in debates over the carbon that is "embedded" in China's exports and the responsibility of developed nations for the majority of historical global emissions.

These arguments are not wholly without merit but miss the point at a time when all nations, including China, must act quickly to build energy-efficient, low-carbon economies or risk runaway climate change.

A national climate change policy should also express China's willingness, in time, to commit to greenhouse gas emissions reductions, focusing initially on specific industrial sectors and, eventually, on economy-wide "caps" on total emissions. This step is necessary since battling climate change requires the decrease of absolute emissions of each nation, as opposed to merely decreasing energy consumption per unit of GDP, which is China's current policy.

The policy should use a mixture of incentives and mandates, to place China on the road to an energy transformation, away from conventional fossil-fuel power generation and towards the use of renewable energy sources and energy conservation measures.

China will benefit from a bold and visionary climate policy in several areas including enhanced security since the country will be in an increasingly precarious position as a result of changing climate, particularly in terms of water availability.

Most of the major river systems that feed and water China, India, and Southeast Asia depend on meltwater from the Himalayan region. Climate change is endangering this vital source of water for 60 percent of the human population. Himalayan glaciers, which provide some 70 percent of the flow of major Asian rivers, are melting at an extremely rapid rate; one study, published in the prestigious journal Nature, predicts that the Himalayan-Hindu Kush region will start to "run out of water" during the dry season. Besides disrupting agricultural activities and destabilizing massive and volatile populations, such a situation would imperil China's economic growth.

Additionally, the aggressive pursuit of a truly low carbon economy can help establish an era of unparalleled innovation and economic prosperity. A study by CERNA, for example, shows that countries that committed themselves to mandatory emissions reductions under the Kyoto Protocol experienced increased levels of innovation in green technologies over those that did not.

The depth and diversity of these economic development opportunities are enormous; China can create millions of urban, high-tech jobs in the manufacture, installation, operation and maintenance of renewable power systems. It can also revive rural economies through the development of sustainable agriculture practices. In all regions, huge amounts of money can be saved as citizens breathe cleaner air and drink cleaner water, reducing the incidence of some diseases.

Action on climate change is also an important sign of membership in the international community. Climate change has emerged as a global issue of paramount importance and by demonstrating that it is prepared to act boldly to combat climate change , China can help to reinforce its image as a responsible nation. Two Hunan University professors wrote in a recent China Daily editorial that "developing a low-carbon economic is a must as China continues to industrialize, not only for the nation's energy security but also as part of an urgent international responsibility to address global climate change."

By embracing this responsibility, China can gain recognition as a full partner in one of the most important global efforts in human history, while also ensuring it has a seat at the table as a global agreement to reduce greenhouse gas emissions is forged.

The fundamental value in a bold, visionary national climate policy is that it builds the foundation for a sustainable future. China stands to gain a great deal from becoming a leader in green technologies, a resource-efficient economy, and a largely self-sufficient energy consumer. China's current policy on climate change is significant and a step in the right direction, but hopefully it represents merely a rough draft of a strategy equal to the challenge of climate change.

Scott Moore is a Fulbright Fellow with the Environmental Economics and Policy Study Group at Peking University. Julian Wong is an independent energy analyst, founder of the Beijing Energy Network, and author of the blog GreenLeapForward.com. The views expressed in the article are their own.