1.1 Background
Climate change science is a dynamic and complex field which has rapidly expanded in recent decades. On a basic level, significant anthropogenic emissions of greenhouse gases (GHGs) have resulted in increased retention of solar radiation within the Earth’s atmosphere, leading to an increase in temperature.1 The Intergovernmental Panel on Climate Change (IPCC) has stated that it is “extremely likely” the increase in average global temperature has been caused predominately by human activity.2 This paper accepts this as a fact. There is also high scientific confidence that the average global temperature has increased by approximately 1°C compared to pre-industrial levels and this is likely to reach 1.5°C between 2030-2050.3 Due to the atmospheric lifespan of carbon dioxide and other GHGs, the changes in temperature will “persist for centuries to millennia”.4 Even if warming is limited to less than 2°C, the world will still have to face significant consequences including the loss of reefs around the world and a rise in sea levels of several metres, creating widespread displacement.5 With so much at risk, a strong international policy response is crucial.
However, recent analyses indicate that the world’s action is failing to match required ambition and the limited timeline to turn this around is rapidly shrinking. Indeed, more carbon has entered the atmosphere as a result of human activity since international discussions on climate change action began in earnest, than “in the entire history of civilization preceding it”.6
The United Nations Framework Convention on Climate Change (UNFCCC) and its subsequent agreements, represents the most universal response to climate change. From their conception, the UNFCCC international negotiations have required the balancing of the needs, values and interests of all its 197 Member States and other stakeholders. Key issues which have defined the negotiations include balancing environmental and economic
1 Metz 2010, p. 30.
2 IPCC 2013, p. 17; IPCC language specifically correlates to a certainty estimate: extremely like refers to a probability of 95-100%.
3 IPCC 2018, p. 6.
4 Ibid, p. 7.
5 Rich 2019, p. 4.
6 Ibid, p. 180.
concerns, how to apply the principle of common but differentiated responsibilities and respective capabilities and obtaining and distributing financial resources to address mitigation and adaptation costs. In addition, concepts such as climate justice, historical responsibility and climate debt have appeared frequently in debates. Agreeing upon an ambitious, specific and politically acceptable target has resulted in many tense negotiations, particularly in light of inherent uncertainty in climate science and an uneven global distribution in climate change effects and the ability to respond to these. Decisions related to the policy tools which should be employed to address climate change have also generated significant political, academic and social commentary and debate. Modern debates continue to discuss the benefits and trade-offs of different policy approaches. Building on these debates, this paper contributes to the understanding of policy approaches, particularly non-market based approaches and supply side regulation.
1.2 Purpose and Research Questions
Previous studies have explored how current policy measures are failing to reach the ambition required to avoid catastrophic climate change. For example, the most recent international agreement on climate change, the Paris Agreement,7 is based on nationally determined contributions (NDCs) in which country Parties specify their own reductions and aim to maintain warming “well below 2°C above pre-industrial levels and pursuing efforts to limit the temperature increase to 1.5°C above pre-industrial levels”.8 However, in 2018 the IPCC held with high confidence that even if country Parties achieved their NDCs under the Paris Agreement, it would still lead to warming beyond 1.5 degrees Celsius, at around 3 degrees Celsius by 2100.9 Research such as the Emissions Gap Report10 and the Production Gap Report11 also reveal wide discrepancies between the science, emissions reduction targets, current policies on climate change and fossil fuel production plans. These reports outline potential actions that could be taken to try and bridge the existing policy gaps and facilitate a just transition away from fossil fuels. Within this frame of reference, this study looks at
7 Paris Agreement to the United Nations Framework Convention on Climate Change (adopted 12 December 2015, in force 4 November 2016), in UNFCCC, COP Report No. 21, Addenum, at 21, U.N. Doc.
FCCC/CP/2015/10/Add, 1 (Jan. 29, 2016) (Paris Agreement).
8 Paris Agreement, Article 2.
9 IPCC 2018, p. 20.
10 UNEP, Emissions Gap Report, 2019.
11 SEI et al. 2019.
potential policy gaps which could be addressed to increase global ambition. In the current agreements, the policy tools adopted by the UNFCCC are predominately market-based mechanisms (MBMs). Accordingly, one policy gap receiving nascent attention is the use of non-market approaches (NMA), which are still being defined within the Paris Agreement.
Another example is fossil fuel supply side policy, which focuses on regulating the upstream activities and presents an opportunity for enhanced ambition.12
This paper operates within the context of the current climate science, ongoing UNFCCC debates and concerns about the inadequacy of the current response, with a specific focus on NMAs. The research questions addressed are:
1. What are non-market approaches in the context of climate change policy?
a. How has the concept of non-market approaches evolved in the context of the UNFCCC?
2. What are the legal elements of Article 6.8 of the Paris Agreement?
a. What are potential non-market approaches under Article 6.8 of the Paris Agreement?
b. What is supply side climate policy and how could it be implemented under Article 6.8 of the Paris Agreement?
The key research contribution of this paper is the mapping of historical country Party submissions in UNFCCC debates relating to NMAs to provide guidance on the interpretation of Article 6.8 of the Paris Agreement. This mapping shows the long and tense process undertaken in order to incorporate NMAs into the Paris Agreement. It also aims to provide clarity on the possible functions, applications and forms that NMAs under Article 6.8 could take. A brief history of MBMs in climate change policy is also provided, in order to highlight existing policy gaps and demonstrate roles which NMAs could play in the future. Second, this paper contributes a case study of the synergies between Article 6.8 and supply side policy, demonstrating the type of international collaboration which could be implemented under Article 6.8. The purpose is to provide a possible interpretation of Article 6.8 and emphasise important potential consequences of the law, such as increased ambition and effectiveness in international actions to tackle climate change.
12 Ibid.
1.3 Methodology
In this paper, the policy approach is used to explore possible interpretations of Article 6.8 by reviewing the history of NMAs within the UNFCCC negotiations. The policy approach incorporates sources beyond legislative sources in order to gain information about the setting in which a particular policy was developed and how it could be interpreted. This approach is often used when the law itself offers insufficient information on a topic, a relatively common issue in international environmental law as many norms are still emerging.13 Article 6.8 of the Paris Agreement was selected as the focus of this research as it is the first specific provision in the UNFCCC dedicated to NMAs. As a recent and relatively poorly defined provision, there is little certainty around its possible functions. Accordingly, research in this field can help to advance its understanding and demonstrate its potential to make an impact.
The negotiation history of NMAs in the UNFCCC has been selected for this research because it provides an accessible and official outline of different countries’ views on NMAs in climate change policy in recent years. Similar to a social constructivist approach, the policy approach highlights the role of Member States as active actors making policy choices related to international climate change regime and shaping the global response.14 States are both the key legislators and regulated subjects under international law and it is their actions which create, dissolve or promote norms within this sphere.15 Mapping the negotiation history of NMAs in the UNFCCC thus contextualises the decision-making process by highlighting central actors, such as Bolivia, opponents and the reasoning behind these positions. The policy approach also subjectifies the historical of exclusion of NMAs from the international climate change regime. Instead of portraying the late inclusion of NMAs into the UNFCCC as the natural result of policy choices based on science or cost-benefit analysis, this review demonstrates the influence of national priorities and agendas hindering their adoption. In addition, this approach shows how different countries perceived of NMAs during negotiations, including matters such as the various principles, aims and limitations which should be incorporated into NMAs and the potential competing interests and
13 Bodansky 2010, p. 6-8.
14 Landefeld 2019, p. 48.
15 Hall 2017, p. 258.
concerns. The broader perspective enabled by the policy approach means that all these different factors can be taken to build up an understanding of Article 6.8.
A narrower, doctrinal approach is used to analyse the text of Article 6.8 of the Paris Agreement. Guidance relating to the interpretation of Article 6.8 is yet to be agreed upon and the section has not been relied upon, resulting in a lack of clarity of the provision. The doctrinal approach is traditionally used for determining the meaning of legislation and how it may apply to a specific case,16 making it well-suited to analyse the elements of Article 6.8.
The sources generally reviewed for a doctrinal approach include legislation and explanatory legal documents, both of which are explored as part of this paper.17 One criticism of the doctrinal approach is that fails to consider context when analysing legislation.18 For this reason, the policy and doctrinal approaches complement each other. Chapters 3 and 4, in particular, demonstrate how these two research approaches work in tandem. In Chapter 3, the doctrinal approach is used to identify legal elements of Article 6.8. In Chapter 4, the policy approach then explores how these elements could apply to supply side policy and other relevant matters such as political feasibility, economic factors and potential co-benefits. The doctrinal approach ensures that the analysis of Article 6.8 properly considers the legal aspects of the provision, while the policy approach draws on country Party submissions and other relevant documents to give context and greater depth to the analysis.
As demonstrated, the two methodologies are used in this paper because they work together to comprehensively highlight how the legal elements of Article 6.8 are shaped by the evolving concept of NMAs in the UNFCCC.
1.4 Limitations
The scope of this research is limited to the mapping of country Party submissions related to NMAs in the UNFCCC, particularly focused on the Paris Agreement, a doctrinal analysis of Article 6.8 and the exploration of a case study on supply side policy and Article 6.8. The study focuses broadly on UNFCCC Party submissions in the period 2007-2015, with an emphasis on the final years before the Paris Agreement in 2015. The doctrinal analysis of Article 6.8 draws upon more recent UNFCCC documents to show the ongoing work in this
16 Pendleton 2017, p. 234; Bodansky 2010, p. 5.
17 Pendleton 2017, p. 235.
18 van Hoecke 2013, p. 3.
area. These points of focus indicate several key limitations to this study. The subjects reviewed are limited to Parties to the UNFCCC and excludes other potentially important stakeholders such as observers, the private sector and civil society. The types of documents reviewed could also be broadened. Currently, this study is predominately limited to official Party submissions to the UNFCCC relating to the negotiations on new mechanisms between the Kyoto Protocol and the Paris Agreement, which excludes other documentation which could give an insight into country narratives regarding non-market mechanisms. For example, drawing on opening remarks from country Parties at UNFCCC Conference of the Parties (COPs) and other relevant submissions to the UNFCCC may provide a broader understanding of national priorities and how these affect national positions on NMAs.
Similarly, reviewing non-UN documentation such as national press conferences may provide greater insight into national narratives on NMAs.
The overview provided on NMAs is a further limitation in this study. NMAs are extremely broad and exist in many forms throughout international, national and regional forms of regulation. It is not the purpose, nor within the scope, of this paper to provide a comprehensive overview and definition of all possible policy mechanisms which could be perceived as non-market. Furthermore, there are many bodies and functions attached to the UNFCCC which can be categorised as NMAs, such as the Green Climate Fund (GCF).
Similarly, there are numerous campaigns and advocacy groups calling for the curtailing of GHG emissions through the use of NMAs or mixed policy mechanisms in the international environmental sphere. There is no doubt that these broader processes have had an impact on the development of the Paris Agreement and these are acknowledged where possible and appropriate.19 This paper does not, however, attempt to outline all the key environmental movements advocating for NMAs in international climate change policy which occurred during the studied time period. Accordingly, these processes are largely treated as separate from the specific negotiations under the UNFCCC which resulted in Articles 6.8 and 6.9.
While this research aims to highlight the underdevelopment of NMAs compared to MBMs within the UNFCCC arena and touches on general critiques of neoliberalism, it leaves open the possibility for further research into the ideological basis for this phenomenon. Likewise,
19 See i.e. the brief discussion on the Rights for Mother Earth in Chapter 3.
it does not provide an evaluation of the effectiveness or impact of NMAs and MBMs within the international climate change regime.
1.5 Structure
MBMs and NMAs are defined by their mutual exclusion. Thus, in order to give substance to the concepts of NMAs and MBMs, Chapter 2 starts by defining key elements of market mechanisms, in particular Pigouvian taxes and pollution trading permits. It then provides an overview of the background of market and non-market mechanisms in early environmental policy and international climate change conferences. MBMs in the international climate change regime, specifically the Kyoto Protocol and the Paris Agreement, are then outlined.
In order to demonstrate the value which NMAs could offer and the policy gaps which they could address, Chapter 2 provides a critique of market-based approaches.
The purpose of Chapter 3 is to give context and historical insight into the development of Article 6.8 of the Paris Agreement. This is achieved through a review of country Party submissions on NMAs within UNFCCC negotiations from 2007 up until the Paris Agreement was adopted in 2015. This highlights the diverse perceptions of NMAs in the lead up to the Paris Agreement and the adoption of Article 6.8. Particular attention is paid to submissions from country Parties advocating for NMAs, nations with high vulnerability to climate change and governments with significant leverage in international discussions.
The second section of Chapter 3 is a doctrinal legal analysis of Article 6.8, with guidance drawn from the continuing work being done on an NMA framework and other relevant documents from the UNFCCC negotiations. The different elements of Article 6.8 are identified and dissected to provide some clarity on the potential function of policies implemented under the provision. The final section of Chapter 3 provides an overview of general elements of NMAs which would need to be considered when designing any policies or mechanisms to be implemented under Article 6.8.
Building on the background and analysis in Chapter 3, Chapter 4 uses a case example to explore how a supply side non-market mechanism could look under Article 6.8. An explanation of supply side policy is first provided. This includes an outline on the role of fossil fuels in global GHG emissions and highlights the potential for supply side policies to reduce and monitor these emissions. Chapter 4 then explores the synergies between Article
6.8 and supply side policy to demonstrate how the international expansion of non-market, supply side regulation could be facilitated under Article 6.8. This analysis includes a review of the UNFCCC as a forum, the roles of different actors, the role of the market and an overview of co-benefits from supply side policy. The limitations of this case example are then discussed in the final section. The overall purpose of this section is to highlight the viability of Article 6.8 as an avenue for ambitious NMAs which can make a genuine, positive impact on global efforts to reduce GHG emissions.
Chapter 5 provides a final overview of the elements discussed in this paper and highlights their potential for application in future research.