UK centre-right MEP Ian Duncan is steering the EU ETS post-2020 reform bill through the EU Parliament’s environment committee, though he currently has a wider outlook and is attending the UN climate talks in Paris. Carbon Pulse speaks to him on the sidelines of the negotiations.

ETS WORK TAKES SHAPE

Appointed as the committee rapporteur in September, Duncan intends to convene a series of interviews on the post-2020 reforms with key experts and his seven shadow rapporteurs from the other political groups.

“We will be holding a series of informal negotiations, one a month, on the key issues,” he said.

The first two of these sessions will be on carbon leakage issues, which have already emerged as the bill’s hot topics, followed by activity level thresholds and reduction factors. The final dialogue will be on the bill’s two cash pools – the Innovation and Modernisation funds.

Duncan said this would put the bill on track to begin to be drafted in April or May, and to be heard in the committee before the assembly’s August summer break.

The Parliament’s draft timetable foresees a vote in the committee in September, after which it could be possible to enter fast-track negotiations with the Council of member states and have the bill agreed by the end of the year.

BUNFIGHTS

Duncan hopes that the current “bunfight” between the parliament’s environment and industry committees for control of the ETS proposal will soon be over.

“We’re hoping this will be resolved before Christmas,” he said, adding that it was likely that the issue would need to be put before the Conference of the Presidents, a bi-monthly meeting of the chairman of the political groupings.

He rejected a suggestion from some parliamentarians that the dossier could be split between the two bodies of MEPs.

“This is clearly an environment dossier,” he said.

GLOBAL MOVES

Duncan has held meetings at the Paris talks with ministers and representatives of other countries and regions with carbon markets in development. These included China, South Korea, Canada and its provinces of Manitoba and Ontario, and California – which involved officials in the current adminstration and former Governor Arnold Schwarzenegger.

“The challenge for everyone is how to have a functioning carbon market that does not run the risk of driving out energy-intensive industries,” he said.

He said the pace of the development of China’s national cap-and-trade system was unlikely to be matched in other places.

“China will drive the debate because they are moving at such a rate that we might have to up the pace ourselves.”

Beijing officials said this week that China’s national market was intended at launch in 2017 to regulate twice the amount of emissions as the EU ETS, which is currently the world’s biggest carbon market.

THE 1.5C EFFECT?

Duncan said a global goal to limit warming to 1.5 degrees C may force EU lawmakers to ratchet up the bloc’s EU ETS reform proposal.

The proposal calibrates the ETS to the bloc’s goal of cutting emissions 40% under 1990 levels by 2030 by deepening the annual cap decrease from 2.2% from 1.74% after 2020.

“The mention of 1.5C here is a bit of a surprise, a lot of work [on the EU ETS proposal] would need to be reconsidered, as the linear reduction curves have been based on a logic of 2C,” said Duncan.

Nations have already agreed to limit global warming to 2C above pre-industrial era levels, but a push by over 40 low-lying and vulnerable nations in Paris has led to draft Paris text to hold temperatures to “well below” 2C and an aspirational goal to “pursue efforts” to limit temperature rises at 1.5C.

Scientists views vary over whether the 1.5C is still feasible, with Norway’s Cicero Institute claiming the emission budget to achieve it would be blown as the Paris agreement comes into effect in 2020.

Germany’s Climate Analytics say the initial emission trajectory could be similar to a 2C path until 2025-2030, when a much more rapid phase out of emissions would be needed. Zero emissions from energy and industry is necessary by 2050, 10-25 years earlier than for 2C, and negative emissions technologies will be needed for both.

While only the 2C would be binding, environmental campaigners are keen to include the 1.5C wording to guide future debates, while some low-lying islands point to models that suggest they will disappear if temperatures hit 2C, making it unthinkable for them to sign up to a pact that fails to mention deeper ambition.

Duncan said it would at least require some consideration by EU lawmakers.

“If [including 1.5C] doesn’t influence your policy, then what is its purpose? The EU Parliament and Council would need to consider what that means,” Duncan said.

By Ben Garside – ben@carbon-pulse.com