Comparability of Effort in International Climate Policy ArchitectureCoauthor
William Pizer, Duke University
Encouraging individual members of a group to agree to policies of self-regulation is difficult enough; requiring them to do so without enabling each member to measure the commitment of the other parties involved is a recipe for distrust and diminishing resolve. Within the arena of international climate change agreements, the need for transparent measures for comparing mitigation efforts is urgent. In their paper “Comparability of Effort in International Climate Policy Architecture,” Joseph Aldy, a Harvard Kennedy School Assistant Professor of Public Policy, and William Pizer, of Duke University, present the potential benefits of measuring mitigation efforts and examine suitable metrics for comparing efforts among agreement-signing nations.
Aldy is intimately familiar with the challenges of international climate negotiations. In 1997, while working at the Council of Economic Advisers in the Clinton White House, he was tasked with running economic models of proposals at the Kyoto Conference. Following the Kyoto Conference, Aldy and a colleague devised a strategy for engaging developing countries in the agreement, on the premise that these countries could take on emission targets specified as a function of their economic growth, which China and India proposed to do in 2009.
In 2009, he returned to climate negotiation work, acting as special assistant to the resident for energy and environment in the Obama administration and participating in the Major Economies Forum on Energy and Climate and the 2009 Copenhagen and 2010 Cancun climate talks. In this position, Aldy worked extensively on ways to promote an inclusive, transparent agreement based on useful reporting measures and accurate reviewing procedures.
Aldy and Pizer consider and assess six metrics in their paper, and their analysis comprises the most detailed work done to date in this area. Indeed, as Aldy’s previous research indicates, there is currently no good system of collecting and analyzing information on countries’ emission mitigation effort, and the current process of policy surveillance under the climate treaty is, he acknowledges, inadequate. What emerged from the Copenhagen talks was a system that allowed for countries to pledge their mitigation goals on their own terms; some countries, like the United States, pledged to commit to emissions reduction targets relative to a historic base year, whereas others committed to reduce the emission intensity of their economies. While this allows for differing approaches, the resulting heterogeneity of commitments makes it more difficult to assess whether countries are making comparable efforts.
Aldy and Pizer discuss an emissions metric with three-prongs: one that employs a base-year benchmark (such as that used in the Kyoto context, which considered emissions relative to 1990 levels), one that considers emission intensities in relation to GDP, or one that uses forecasts to estimate emission abatement. Their analyses illustrate both the usefulness of and pitfalls associated with these different measurement approaches. In a similar manner, the authors consider the integrity and feasibility of employing the metrics of carbon prices (which reflect the degree to which countries are undertaking less or more expensive mitigation efforts), energy prices and taxes, and mitigation costs.
The authors assess these metrics in relation to four guiding principles, evaluating whether each metric is comprehensive, measurable, replicable, and universal. As might be expected when considering the variables involved, there is no single, ideal metric that satisfies the comprehensive principle. According to Aldy, however, this is by no means a fatal flaw. “The same is true when analysts attempt to investigate the health of countries’ economies,” he says. “We use a suite of measures for that—GDP growth, unemployment rate, inflation, interest rates, investment, etc.—to characterize the health of the economy. In the same way, we believe this suite of measures—emission reductions, carbon and energy prices, and costs—can be used in aggregate to enable an assessment of individual countries’ mitigation efforts and to facilitate a comparison with other countries’ efforts.”
This type of comparability of effort analysis is vital for the success of international climate agreements, the authors argue. Not only are all parties to an agreement more likely to comply if their participation can be tracked and measured, but evidence of compliance (or lack thereof) can inform the negotiation over subsequent rounds of commitments.
Ultimately, though, the benefits of an effective comparability program and a well-functioning policy surveillance regime would outweigh the costs of enabling transparency. “If all the major economies believe they are making fair and comparable contributions to mitigate climate risks,” says Aldy, “then it may build the support and trust for each of them to increase the ambition of their effort. It may also help governments defend an international agreement with domestic stakeholders by allowing them to show that other major economies (including trade competitors) are taking on comparable effort to mitigate emissions.”
—by Susannah Ketchum Glass