Brexit and the Paris Agreement

The manner in which the mainstream parties deal with the UK’s international (non-EU) climate change obligations in their respective election manifestos is interesting.

The Conservatives pledge: “The United Kingdom will lead the world in environmental protection …… we will continue to take a lead in global action against climate change, as the government demonstrated by ratifying the Paris Agreement”.

Labour on the other hand simply promises to ““ensure that we meet our climate targets and transition to a low-carbon economy”, whilst the Liberal Democrats agree to “support the Paris agreement by ensuring the UK meets its own climate commitments and plays a leadership role in international efforts to combat climate change”.

You will note that none of them actually commit to meeting the UK’s climate change obligation under the Paris Agreement, and for once they are right not to do so, as nobody actually knows what that commitment is.

The Paris Agreement, signed by 195 countries and ratified by 146, entered into force on 4 November 2016 and has the target of reducing the global average temperature increase to well below 2˚C above pre-industrial levels and working towards a limit of 1.5˚C by setting a further target for net zero global emissions in the second half of the century.

National Defined Contributions (NDC) are submitted by countries for 2020 and at 5 year intervals thereafter, and represent the benchmark against which parties’ performance will be assessed. Each successive NDC has to progress beyond the previous one – this is the “no-backsliding” principle.

The problem is that the UK submitted a joint NDC together with other EU Member States. The EU’s NDC is to achieve an economy-wide reduction in domestic greenhouse gases of at least 40 per cent of 1990 levels by 2030. The Paris Agreement specifically required that, when submitting its NDC, the EU had to notify the emission levels allocated to each Member State. However, in the event this was not done; the Council of the European Union’s decision on the ratification of the Paris Agreement merely stated that “the joint action by the Union and its Member States will be agreed in due course”. Member States are currently still engaged in internal negotiations over their respective allocations within the EU’s NDC and the UK does not yet know the level of its commitment.

Once it officially leaves the EU, the UK will need to submit its own NDC, unless the UK and the EU agree on a joint fulfilment agreement. This will in part depend on whether the UK remains part of the EU Emission Emissions Trading System (EU ETS). If it does, then a joint fulfilment agreement will be necessary unless and until Paris Agreement accounting rules are set up under Article 6 to allow the UK to bring its EU ETS trading activity directly into account. The joint fulfilment approach was the one taken by Iceland when it ratified the second commitment period of the Kyoto Protocol; Iceland participates in the EU ETS through its membership of the European Economic Area.

There would appear to be nothing in theory to stop the UK completing the first Paris cycle in joint fulfilment with the EU (once its allocation is agreed and as long as the EU were happy to do this), and then submitting its own NDC in 2025 to cover the five years from 2030.

The Paris Agreement does not provide the option for parties to resubmit their NDCs. It only provides that parties may “adjust” their existing NDCs “with a view to enhancing its level of ambition”. This would suggest that, if the UK did not follow the joint fulfilment option, its NDC would need to commit to more than the joint EU NDC.

The good news is that the UK has already adopted a 57 per cent greenhouse gas reduction target for 2030 through its fifth carbon budget under the Climate Change Act 2008, so (compared to the EU’s 40 per cent) adopting a higher NDC would not cause a problem. The bad news is that the UK currently has no effective strategy to meet the fifth carbon budget. There are currently projected shortfalls against the fourth and fifth carbon budgets of 146 MtCO2e and 247 MtCO2e respectively. According to the Committee on Carbon Change’s “Meeting Carbon Budgets” report (October 2016), current policies are likely to deliver only half of the required emissions reduction to 2030, with a policy gap for the remainder. An Emissions Reduction Plan is expected during the course of 2017 which will hopefully address how the shortfall will be met.

For once the politicians of all persuasions have actually got it right by keeping things vague and flexible. Our international (non-EU) climate change obligations and how we might meet them is both literally and figuratively all up in the air.

Author: John Chandler, energy partner, Shakespeare Martineau LLP.,
Channel: Policy & Regulation
Tags: European Commission , UK , Trading , Government and NGOs

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