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Small is Beautiful: Why a Club Approach is the Way to Go in Climate Change Mitigation



This chapter argues that the Kyoto Protocol to the 1992 Framework Convention on Climate Change was doomed to face difficulties ab initio and tries to draw lessons from the international trading system’s architecture for climate change mitigation negotiations. The UNFCCC has traditionally divided the world into developed countries (including countries undergoing the process of transition to a market economy) and developing countries. It places the responsibility of reducing emissions with developed countries as if they were the only sinners of climate change. A better (and arguably fairer) way to tackle the climate change issue today is by bringing together the major GHG emitters, irrespective of their GDP. Why so? Because seen retrospectively, rich-countries have been (and continue to be) the major polluters; they are responsible for most of the GHG emissions, and have the financial and technological means to tackle climate change. However, seen prospectively, it is a developing countries problem, as predictions indicate that, in the near future, developing countries will be the major polluters as well as the major victims of the consequences of climate change, especially countries near the equator. The longer we wait, the harder and more expensive it will become to deal with climate change. So the major GHG emitters (whether developed or developing countries), which are responsible for historic, current and future emissions, should, therefore, be the ones to take action.The chapter concludes that no breakthroughs will take place regarding climate change mitigation until there is more political maturity on the side of the U.S. and until rapidly emerging economies indicate that they are ready to play their part.
Queen Mary University of London, School of Law
Legal Studies Research Paper No. 264/2017
Small is beautiful: Why a club approach is the way to go
in climate change mitigation
Rafael Leal-Arcas
Leal-Arcas Small is beautiful: A club approach in climate mitigation
Small is beautiful: Why a club approach is the way to go
in climate change mitigation
[published in Leal, W. and Surroop, D. (eds.) The Nexus: Energy, environment and climate
change, Springer, 2018, pp. 305-317; ISBN: 978-3-319-63611-5]
Prof. Dr. Rafael Leal-Arcas
Centre for Commercial Law Studies, Queen Mary University of London, United Kingdom
Keywords: bottom-up approach to climate change mitigation; Major Economies Forum; variable
This chapter argues that the Kyoto Protocol to the Framework Convention on Climate Change
(UNFCCC) was doomed to face difficulties ab initio and tries to draw lessons from the international
trading system’s architecture for climate change mitigation negotiations. The UNFCCC has
traditionally divided the world into developed and developing countries. It places the responsibility
of reducing emissions with developed countries as if they were the only sinners of climate change. A
better (and arguably fairer) way to tackle the climate change issue today is by bringing together the
major GHG emitters, irrespective of their GDP. Why so? Because seen retrospectively, rich-countries
have been (and continue to be) the major polluters; they are responsible for most of the GHG
emissions, and have the financial and technological means to tackle climate change. However, seen
prospectively, it is a developing-countries problem, as predictions indicate that developing countries
will be the major polluters. So the major GHG emitters (whether developed or developing countries),
which are responsible for historic, current, and future emissions, should therefore be the ones to take
action. The chapter concludes that no breakthroughs will take place regarding climate change
mitigation until there is more political maturity on the side of the U.S. and until rapidly emerging
economies indicate that they are ready to play their part.
* Jean Monnet Chaired Professor in EU International Economic Law and Professor of Law, Queen Mary University of
London (Centre for Commercial Law Studies); Member, Madrid Bar. Ph.D., European University Institute; M.Res.,
European University Institute; J.S.M., Stanford Law School; LL.M., Columbia Law School; M.Phil., London School of
Economics and Political Science; J.D., Granada University; B.A., Granada University. Email:
Leal-Arcas Small is beautiful: A club approach in climate mitigation
This chapter argues that the Kyoto Protocol to the 1992 UNFCCC was doomed to face serious
difficulties ab initio because it places the responsibility of reducing GHG emissions only with
developed countries (i.e., Annex I countries) as if they were the only sinners of climate change. If the
international community is serious about GHG emissions reduction, a more plausible way to reduce
GHG emissions (which is the whole purpose of the exercise) is to involve major GHG emitters,
irrespective of their GDP.
International law is fragmented. The case of international trade law is a good illustration of the fact
that international law, generally speaking, operates in a fragmented fashion (Cottier and Delimatsis
2011). At first, international trade agreements were bilateral. Then came the GATT 1947, which
multilateralized bilateral trade agreements. Years later, international trade law saw the collapse of
multilateralism in 1979, which broke down during the Tokyo Round of multilateral trade negotiations
(World Trade Organization 2016). A series of new plurilateral (or selectively multilateral) agreements
were adopted during the Tokyo Round, which caused a fragmentation of the multilateral trading
system (Leal-Arcas 2011). In 1994, international trade law was again multilateralized with the World
Trade Organization (WTO) Agreement (Leal-Arcas 2010).
The same thesis could be used for climate change law. Although not always easy, as demonstrated
by the Doha Round, why not emulate the successful experience of multilateralization of international
trade law from the bottom up (which started with the GATT 1947) for the case of climate change
law? If so, to what extent can the experience in international trade negotiations and the WTO
framework as a bottom-up approach serve as an example? (Cottier 2006) The trend of using bilateral
or plurilateral trade agreements to build towards eventual trade multilateralization may be worth
emulating for the case of climate change law (Cottier 2011).
The chapter explores the architecture and operation of international instruments relating to climate
change mitigation and their interaction with the international trading system. It examines the
possibility of a complementary combination of top-down and bottom-up approaches to building a
global climate landscape and the link of national and regional climate arrangements with the
UNFCCC framework (Leal-Arcas 2011a). Although the UNFCCC’s mandate is about mitigation and
adaptation of climate change, the present chapter focuses solely on the climate change mitigation
dimension of the UNFCCC with its aim of achieving an international agreement for climate change
Leal-Arcas Small is beautiful: A club approach in climate mitigation
mitigation post-2015. In this sense, the chapter explains and justifies the bottom-up approach to
climate change negotiations, and explores the possibility of variable geometry. It examines various
fora for implementing a more effective GHG emissions reduction.
Paradigm shift: Justifying a bottom-up approach
The Kyoto Protocol is a highly centralized, top-down agreement on climate change, which has proven
to be very rigid in the target of reducing GHG emissions (Kopp 2011). For the purposes of GHG
emissions reduction, the UNFCCC divides the world into Annex I countries and developing countries,
and its Kyoto Protocol legally binds only Annex I countries to reducing their GHG emissions by a
certain deadline (Article 3 of the Kyoto Protocol). Why so? Because seen retrospectively, rich
countries have been the major polluters; they are responsible for most of the GHG emissions, and
have the financial means and technological capability to tackle climate change.
However, instead of asking only Annex I countries to reduce GHG emissions, this chapter argues that
a more effective (and presumably fairer) way to tackle climate change today is by bringing on board
the major GHG emitters, irrespective of their GDP, and ask them to reduce their GHG emissions in
an equitable manner without ignoring the historic responsibilities on the part of developed countries.
That said, the UNFCCC reflects the early 1990s situation, where, in accordance with Article 3.1 of
the UNFCCC, developed countries decided to “take the lead in combating climate change.” More
than 20 years later, the climate change situation has changed. Why do we need to shift the paradigm?
Because the Kyoto Protocol’s stipulation that only Annex I countries reduce their GHG emissions
does not reflect today’s or tomorrow’s climate change reality. In accordance with Article 3 of the
Kyoto Protocol, Annex I countries are asked to lead the way on GHG emissions reduction, for others
to follow, but the U.S. refused. My argument is that it is not enough to ask only Annex I countries to
reduce their GHG emissions if the aim is to solve the climate change issue. This is an example of the
bottom-up approach proposed in this chapter. Moreover, asking major GHG emitters (both developed
and developing countries) to commit to GHG reduction would have the advantage of avoiding a
situation where a small group of industrialized countries would monopolize the regulation of GHG
emissions reduction, something that many developing countries fear.
Major developing countries that are major GHG emitters should also be asked to reduce their GHG
emissions. Why? Seen prospectively, climate change is a developing-countries problem, since they
have already surpassed the industrialized world in total GHG emissions (International Energy Agency
2011) and will account for more than 75 per cent of GHG emissions growth in the next 25 years
Leal-Arcas Small is beautiful: A club approach in climate mitigation
(Energy Information Administration 2007). Developing countries will also be the major victims of
the consequences of climate change, especially countries near the equator (Farber 2008).
The U.S. and other Annex I countries maintain that the terms of the Kyoto Protocol are unfair because
they provide developing countries with inappropriate trade advantages and because the GHG
emissions of leading developing countries are growing rapidly without their being legally bound to
reduce their GHG emissions.
The world has changed dramatically since the UNFCCC divided the world into two categories in
1992. For instance, approximately 50 non-Annex I countries now have higher per capita incomes than
the poorest of the Annex I countries with commitments under the Kyoto Protocol. In the same way,
40 non-Annex I countries ranked higher on the Human Development Index in 2007 than the lowest
ranked Annex I country. The trend of developing countries catching up continues in the post-2008
financial crisis period, as developing countries are still growing macro-economically, whereas many
developed countries are in economic stagnation or recession. So major GHG emitters/economies
(whether developed or developing countries), which are responsible for historic, current, and future
GHG emissions, should therefore be the ones to take action in an equitable manner.
As of 2000, the top 25 GHG emitters accounted for approximately 83 per cent of global emissions.
These numbers exclude emissions from international bunker fuels, land use, land-use change, and
forestry (Baumert et al., 2005). Moreover, the top five GHG emitters today (China, U.S., the
European Union (EU)—treated as a single entity—India, and Russia) were responsible in 2000 for
over 60 per cent of global emissions. In contrast, most of the remaining countries contributed very
little in absolute terms to GHGs in the atmosphere (i.e., the 140 least-pollutant countries were
responsible for only 10 per cent of global GHG emissions). These countries include the least-
developed countries and many small island States.
To show the importance of rapid action in climate change mitigation, 15 out of the 195 UNFCCC
members were responsible for approximately 80 per cent of global GHG emissions in 2005, which
means that, between 2000 and 2005, the level of GHG emissions coming from major emitters
increased (These numbers exclude emissions from land use, land-use change, forestry, and
international bunker fuels). This figure means that the remaining UNFCCC membership was only
responsible for around 20 per cent of global GHG emissions. In other words, very many countries
have contributed very little to climate change, but very few countries have contributed very much.
Leal-Arcas Small is beautiful: A club approach in climate mitigation
This latter small group of countries should therefore be responsible for fixing the current situation,
which would be easier and less complex to fix in a small club than among the entire UNFCCC
The underlying rationale
Based on empirical observation, variable geometry (or a ‘club’ approach) seems both logical and fair
as a mechanism to move the climate change agenda forward, given that a relatively small number of
countries produces a large majority of GHG emissions. Moreover, from a practical viewpoint, it is
easier and more manageable to negotiate amongst a small number of large players than amongst a
large number of small players, which explains the creation of clubs. So bringing together a group of
countries (i.e., major GHG emitters in the case of climate change, whatever the format may be,
whether bilaterally or plurilaterally) seems to make sense, especially because there is more pressure
to deliver when the group of countries is smaller (Abbot and Snidal 1998). Furthermore, less time is
spent on procedural matters when dealing with a small group of countries. In addition, based on
international negotiating experience from other fields, the only way to get any real business done is
in small meetings (sometimes tête-à-tête meetings between key leaders) (Poteete 2010).
If we accept this club approach, what fora may be used for formulating a global response to climate
change? (Levi 2010; Stavins 2010) The G-20, the Major Economies Forum on Energy and Climate
(MEF), the climate G-8,1 the G-3,2 and regional groupings all seem plausible options to provide
political leadership. They all have the shared vision that GHG emissions must be reduced, with targets
for developed countries and actions from developing countries. As mentioned earlier, though, not
every part of the world needs to be represented at the beginning. The global GHG contribution of the
least-developed countries and small island developing States is so minimal, that it seems logical to
start with the major GHG emitters and eventually have the rest of the world join in the quest for GHG
emissions reduction. Once the major parties are grouping together, the chance of having other
countries join increases (Barrett 2003). Previous experience shows that negotiating and decision-
making resulting from such clubs has been valuable in fora such as the UN Convention on the Law
of the Sea, the WTO or the creation of the Montreal Protocol (Kahler 1992). So there seems to be
added value to formalizing negotiations in smaller groups.
1 The climate G-8 would be composed of China, the U.S., the EU, India, Brazil, South Africa, Japan, and Russia (currently
suspended). This group represents the key economies in each region of the world and is responsible for 70 per cent of
global GHG emissions. This number includes land use, land-use change, and forestry. For views on the climate G-8, see
Stern, T. and Antholis, W. “Toolbox: Creating an E-8,American Interest, Vol. 2, No. 3, Winter 2007, pp. 43-49.
2 I am referring to the G-2 (U.S. and China) plus the EU.
Leal-Arcas Small is beautiful: A club approach in climate mitigation
There are, however, disadvantages to the variable-geometry option. If one were to start with a smaller
group of players, say the EU, the U.S. and China, and, by virtue of doing so, one keeps for instance
the most vulnerable countries out of the climate negotiations, how does one ensure sufficient ambition
to reduce GHG emissions? There is a time window, optimistically, up to 2020 to reverse the trends
in global GHG emissions and begin their sharp decline, at least if we are to keep global average
temperature increases below 2°C with reasonable certainty. In this sense, the Paris Agreement on
Climate Change aims to keep the global average temperatures “well below 2 °C above pre-industrial
levels”3 and also to “pursue efforts to limit the temperature increase to 1.5 °C above pre-industrial
levels, recognizing that this would significantly reduce the risks and impacts of climate change.”4
Having only the major GHG emitters on the table may possibly translate into a situation where these
countries would indulge in a rather low GHG emission ambition (Sustein 2008; Yang and Sirianni
2010), agree quickly among themselves, and then sell the results as major achievements in climate
diplomacy, whereas in fact they lock the world into a disastrous climate change scenario simply
because of the very limited remaining carbon budget. This is in contrast to the negotiation of trade
agreements, where delays may mean little more than a delay of economic benefits from such
agreements, and ambition can be increased at any later stage.
Furthermore, why would countries engage in mini-lateral or even bilateral agreements that have any
reasonable hope of meeting the 1.5-2°C target? When negotiating trade agreements, parties have an
interest to negotiate as they believe they will benefit from the agreement. By contrast, in climate
change negotiations, most parties see mitigation as a burden to their economies, i.e., they negotiate
to ensure that they do not have to do more than other parties in the negotiation. This would be different
if there were a general belief that mitigation is beneficial for the economy and therefore needs an
international agreement to maximize the parties’ benefits. While there are voices that point to the
many economic benefits of ambitious mitigation, this belief has yet to enter the minds of finance
ministers, companies, and society at large.
Forum options
A collective action problem is a situation where those involved can choose between two options, and
if they select the one that is individualistically rational (IR), the result for all parties concerned will
3 Article 2.1(a), Paris Agreement, Draft decision -/CP.21.
4 Idem.
Leal-Arcas Small is beautiful: A club approach in climate mitigation
be worse, in their own judgment, than if they were to choose the other option, i.e., the option that is
not IR. Typically, in any collective action problem, the IR alternative is called defection and the non-
IR alternative is referred to as cooperation (Olson 1965). By this token, then, climate change could
be termed a collective action problem.
This section argues that polycentric systems can produce collective action more effectively than
unified institutions such as the UNFCCC/Kyoto Protocol process (Ostrom 2010; 2010a). Moreover,
it is also argued that climate governance should follow the examples of concentric circles in larger
structures in other fields of global governance. For instance, just as the G-20 in the context of the
International Monetary Fund or the Security Council in the context of the United Nations are
examples of concentric circles for monetary and foreign policy respectively, the Major Economies
Forum on Energy and Climate may serve as a concentric circle for the UNFCCC in global climate
governance. However, in the case of climate change negotiations, least-developed countries and
small-island States have constantly shown their preference for the UNFCCC as a negotiating platform
because their voices can be heard (Durrant 2002). In spite of these objections, this chapter argues that
alternative fora may be the most effective way to move forward. In this context, below are some non-
exhaustive suggestions of plausible forum options to produce collective action in climate change
mitigation and adaptation. The various selected concentric circles from smaller to larger are the G-2,
the G-3, the MEF, and the G-20, which does not reflect an order of preference. The list of possible
concentric circles could go on and on, and there have been suggestions for other possible fora.5
The G-2
What is absurd is that the world’s first and second largest CO2 emitters—i.e., China and the U.S.,
respectively—are not bound by the Kyoto Protocol to reduce GHG emissions: China, because it is
not an Annex I country, and the U.S., because it has not ratified the Kyoto Protocol (Seligsohn et al.
2009; Pew Center & Asia Society 2009; Stewart and Wiener 2003). Together, they (i.e., the G-2)
account for over 42% of the world’s total GHG emissions (United Nations Statistics Division). If we
are serious about reducing GHG emissions, we must have both countries on board, without which it
is difficult to continue effectively with climate change negotiations. The U.S. can influence and push
China’s international climate change policy in three ways: first, setting an example; second, helping
China reduce abatement costs; and third, promoting China’s concern over the climate change issue.
The U.S. is a crucial country in climate change negotiations because it has both the technology and
the financial capacity to reduce GHG emissions (Pacala and Socolow 2004). Having the U.S., China,
5 For instance, the G-8+5, which would be composed of the G-8 (i.e., the U.S., Canada, UK, Germany, France, Italy,
Russia and Japan) plus five leading developing countries (Brazil, India, China, Mexico, and South Africa).
Leal-Arcas Small is beautiful: A club approach in climate mitigation
and the EU on board would certainly expedite the creation of a future global climate change
A way forward in climate change negotiations is the creation of bilateral deals between developed
and developing countries, possibly (and desirably) involving the U.S. These could include emissions
allowances, a Kyoto-type Clean Development Mechanism, cash, and non-climate change benefits in
trade or other side payments or linkages, for instance, and may solve some of the equity problems
among countries of who pays how much. The conclusion of bilateral deals is preferred among some
countries (India, China, and Brazil) because they offer more immediate returns. The international
community should ideally aim at the multilateral coordination of these bilateral deals. Examples of
bilateral deals are the Australia-China Natural Gas Technology Partnership Fund, the EU-China
Partnership on Climate Change, the US-India Civil Nuclear Cooperation Initiative, the US-India
Partnership to Advance Clean Energy, Energy Security and Climate Change, and the EU-India energy
The G-3
An agreement among a small group of major GHG emitters (for example, China, the U.S. and the EU,
i.e., the G-3) could provide a starting point for building new international emissions-reduction
commitments involving all major emitting countries. If this group of countries can agree to some
meaningful measures, then the arrangement might be expanded to include Brazil, Japan, Australia,
Canada, India, Indonesia, South Africa, possibly Russia, and other major emitting countries. This
major emitter “club” could be built under the auspices of an existing international forum, such as the
G-20 group of major developed and developing countries, or a new network organization, and
eventually feed back into the UNFCCC, which would provide much more legitimacy to the exercise.
On the other hand, major countries that are not at the table may object to a three-party initiative (such
as the suggested one of China, the U.S., and the EU), triggering a backlash that could impede progress
on global GHG emissions reductions.
Linking the previous section with this section, the proposition of a G-2 or G-3 raises the following
questions: is it wise to proceed with just two or three parties, rather than using the UNFCCC process
or using a forum such as the G-20 or the MEF to negotiate new undertakings? Will a club approach
promote or restrict broader progress?
Leal-Arcas Small is beautiful: A club approach in climate mitigation
The Major Economies Forum
The Major Economies Forum on Energy and Climate (MEF) was initiated in 2007 by the Bush
administration under the name “Major Emitters Forum” and launched by the Obama administration
on March 28, 2009. The MEF is intended to facilitate a candid dialogue among major developed and
developing economies, help generate the political leadership necessary to achieve a successful
outcome at future UN climate change conferences, and advance the exploration of concrete initiatives
and joint ventures that increase the supply of clean energy while cutting GHG emissions. The MEF
would provide for significant GHG limitations with credible assurances for compliance (Stewart et
al. 2011). The MEF partners include: Australia, Brazil, Canada, China, the EU, France, Germany,
India, Indonesia, Italy, Japan, Korea, Mexico, Russia, South Africa, the UK, and the U.S. Bringing
together these major emitters, which were responsible for around 75 per cent of GHG emissions in
the world as of 2009 (these numbers include land-use change) (Broder 2009), will increase the
likelihood of reaching a climate change agreement, as the MEF is a more efficient negotiating forum
than the UNFCCC (Oye 1985). Furthermore, an agreement amongst them would be almost as
valuable as an agreement amongst all UNFCCC parties in terms of absolute GHG emissions
reductions, since most GHGs come from the MEF partners.
The MEF is therefore a means to facilitate progress in the climate change negotiations. The MEF has
a controversial relationship with the UNFCCC/Kyoto Protocol process and offers a substantially
different means to respond to climate change. The Kyoto Protocol is universal in scope, whereas the
MEF is based on small-group negotiations among 17 parties; the Kyoto Protocol is legally binding,
whereas the MEF stresses voluntary measures; the Kyoto Protocol focuses on GHG emissions
reduction, whereas the MEF fosters technological innovation. To avoid the obstacles faced by the
UNFCCC machinery, the MEF should focus on each member’s economic weight, GHG emissions
reduction responsibilities, and the calculation of responsibility for GHG emissions such as sharing
the burden equally between producers and consumers, in order to fairly decide who should reduce
GHG emissions and by how much. For instance, most GHGs are emitted because countries do not
have clean sources of energy. They have no choice but to use available technologies. If energy
producing countries have to pay 50 per cent of the cost, there would be a greater incentive to shift
energy production from fossil fuels to clean energy.
The G-20
Most of the largest GHG emitters have large economies, large populations, or both. Given the direct
link between climate change and the world economy, the G-20 could be a plausible forum for moving
Leal-Arcas Small is beautiful: A club approach in climate mitigation
the climate change agenda forward. The G-20 “brings together important industrial and emerging-
market countries from all regions of the world. Together, member countries represent around 90 per
cent of global gross national product, 80 per cent of world trade [including intra-EU trade] as well as
two-thirds of the world’s population. The G-20’s economic weight and broad membership gives it a
high degree of legitimacy and influence over the management of the global economy and financial
system” (G-20). In 2008, the G-20 represented 66 per cent of the world’s population and produced
over 80 per cent of the world’s GHG emissions (US Energy Information Administration 2009).6
The international community should provide a burden-sharing element designed to produce a fair
distribution of burdens across countries (whether developed or developing), taking into account the
historic responsibilities of the developed world, while also giving priority to green economic
development, addressing concerns about wealth inequality, and achieving GHG emissions reductions
consistent with limiting the expected increase in global average temperature to 1.5-2 degrees Celsius,
without sacrificing economic growth. Nations should approach economic growth as part of the
climate solution, not part of the problem.
However, there is no need to have a global solution/universal agreement to this global problem so
long as the major GHG emitters reduce their GHG emissions locally, taking into account the historic
responsibilities of the developed world in order for the process to be equitable. In other words, if
China’s (or any other major emitter’s) GHG emissions decrease, it will benefit the rest of the world,
whereas if China’s (or any other major emitter’s) GHG emissions increase, it will affect the rest of
the world. A local solution can therefore have a global effect. So from an economic and environmental
point of view, it is vital that China bring down its GHG emissions. The ambition to reduce GHG
emissions to safe levels cannot be reached without equity in the process, similar to the argument of
‘no peace without justice.’
Pragmatism should be the crucial element in moving the climate agenda forward: bilateral/plurilateral
agreements in addition to a universal climate agreement, flexibility over rigidity, and practical results
over utopian ideals. Today, the UNFCCC is one platform among several in climate governance. The
UNFCCC is a large structure with limited authority to move quickly and decisively. Ideally, the
international community should preserve the successes of the global regime (top-down approach) in
6 These numbers exclude land use, land-use change, and forestry.
Leal-Arcas Small is beautiful: A club approach in climate mitigation
order to provide credibility to the multilateral system and, at the same time, move on regionally or
with coalitions of the willing (bottom-up approach), which, in turn, will help expedite the goal of
GHG emissions reduction. This would mean a complementary relation between the top-down and
bottom-up approaches to climate change. The post-2015 multilateral framework on climate change
action will most likely take place at domestic and regional levels.
In addition to such a global, universal agreement on climate change, it would make sense to explore,
along with the current legal platform of UNFCCC/Kyoto Protocol, the “clubs approach”—such as
the MEF, the G-2, the G-3, or the G-20—given that the atmosphere does not care where emissions
come from because GHG emissions mix globally in the atmosphere. This means that it does not matter
where GHG emissions reduction takes place.
Regarding ways to move the climate change agenda forward, it is well known that equitable and
efficient international cooperation is very difficult at the multilateral level. The geometries of power
have fundamentally changed with the rising power of China and India. At the time of the signature
of the Kyoto Protocol in 1997, very few people could envisage that China would grow
macroeconomically so rapidly. With economic growth came higher GHG emissions. By 2007, China
became the largest GHG emitter in the world, even if China’s per capita emissions remain
comparatively rather low so far.
There is increasing international pressure on developing countries to reduce their GHG emissions.
No meaningful breakthroughs will take place regarding climate change mitigation until there is more
political maturity and commitment on the side of the U.S. and until rapidly emerging economies such
as China and India indicate that they are ready to play their part in tackling climate change, since they
are part of the solution. If the financial burden to reduce GHG emissions rests only on developed
countries, it would mean a tremendous economic sacrifice for them. If, however, (major) developing
countries are not given financial help by the developed world to mitigate climate change and to
develop economically, it would be unfair on them too. This would imply a re-definition of the
principle of common but differentiated responsibilities. Large emitters of GHGs need to be involved
for climate change negotiations to come to a positive conclusion. Much progress is still needed until
we reach a decarbonized world economy.
What is crucial is that the major GHG emitters reduce their GHG emissions. Every country in the
world will benefit even in the case where only major GHG emitters reduce their emissions. A sensu
Leal-Arcas Small is beautiful: A club approach in climate mitigation
contrario, the whole world will suffer if major GHG emitters increase their emissions, as climate
change is a global problem.
Moreover, the fact that perhaps only a club of major GHG emitting countries may move the climate
change agenda forward plurilaterally to limit GHG emissions—instead of the entire UNFCCC
membership—is not as problematic as would be the case in the multilateral trading system, where
issues of violation of the WTO law principle of non-discrimination would arise. Unlike the case of
multilateral trade agreements, in the climate field, it may be preferable to have a mini-lateral climate
change agreement (through clubs or coalitions of the willing) in addition to a global agreement, if
that means making sure that the Earth’s rising temperature is being addressed. This club-approach
proposition would be feasible through incentives for major GHG emitters to reduce GHG emissions
and therefore to comply with such a mini-lateral climate change agreement. There are clear costs and
risks to not mitigating climate change fast enough, analogous with gaining weight: the more weight
one gains, the greater the chances of a serious cardiovascular pathology and the more expensive it
will be to get back to being healthy. Therefore, a preventive approach to climate change mitigation is
the safest and cheapest option.
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Nobel Memorial Prize winner William Nordhaus and others have proposed a climate club as the ultimate climate-mitigation measure. Meanwhile, the European Union (EU) is pressing on with the creation of a carbon border adjustment mechanism (CBAM) that would put pressure on the rest of the world to introduce the same level of carbon pricing as the EU. There are strong linkages between the concepts of a climate club and CBAM. However, the EU long studiously avoided referring to a climate club in its official communication, and the relationship between the two concepts remains unclear. This study seeks to clarify the relationship through a systematic review of the climate club and carbon border adjustment literatures to highlight synergies and contradictions, reduce fragmentation, and increase actionability. A tailored Boolean search string is used to extract relevant literature, which is then categorised along eight parameters. The VOSviewer network analysis and visualisation software is used to examine cross-citations and bibliographic coupling. The review finds that there are connections between the objectives, methods and concerns of the two branches of literature but that there are divergences in terms of conceptual roots, disciplinary frames and the views that authors take of CBAM/a climate club. Only 7% of the studies relate to international relations theory. Several large emitters, geopolitically important states and developing countries are ignored by the literature. Although the cooperation/resistance of Asian countries will be decisive for the fate of any climate club initiative, only 15% of authors are based in Asia and Western scholars dominate the field. A five-pronged research agenda is proposed to address the identified gaps: enhanced interaction between the fields of research, coverage of a broader range of countries, additional analysis by Asia-based researchers, more contributions from political science and international relations scholars and further work on how to calculate tariffs.
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This article provides a comprehensive examination of the greatest threat humanity faces today: climate change. It does so by looking at the legal, political, institutional, regulatory, and economic angles of climate change from the perspective of major emitters and the most relevant actors in the mitigation of climate change. The article offers a fresh understanding of the international trading system as a way to reach a prosperous, modern, and sustainable society that will help decarbonize the economy effectively. The article offers new ideas on the creation of a climate club linked to the international trade regime as an effective way to mitigate climate change. How should policies, regulations, laws, and agreements change to get us there? What incentives will be necessary to get there effectively? What has failed and why? We conclude that innovation and technology will be among the key elements of this equation, without which we will miss the goal. climate action, renewable energy, sustainability, storage, clean energy, technology, innovation, climate clubs, international trade
There is no question that climate change is one of the biggest challenges humanity faces today. Today, 80% of the global energy supply comes from fossil fuels. Fossil fuels contribute to climate change and are finite, which leads to energy insecurity. We cannot use all the fossil reserves we have without seriously disrupting the climate system. Renewable energy can help here in that it is cleaner than fossil fuels. It also helps towards energy independence and therefore enhances energy security. Renewable energy sources are the only long-term energy supply solution we have at present. Trade law could be used as a vehicle to achieve these goals because trade rules can promote environmental goods and services.
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It is generally agreed that the world would be better off with an international agreement to control greenhouse gas emissions. But it is not entirely clear that the leading emitters—the United States and China—would be better off with the agreement that would be in the world's interest. The first problem is that as the largest emitters, the United States and China would probably have to bear a disproportionate cost of any significant emissions reduction effort. The second problem is that on prominent projections, the United States and China are unlikely to be the most serious losers from climate change. According to some analyses, the two nations are thus anticipated to bear disproportionately high costs from emissions controls and to gain disproportionately little from such controls. There are two ways to eliminate the resulting obstacle to an international agreement. The first is through altering the perceived cost-benefit analysis for both countries. The second is through an understanding that both nations, and the United States in particular, are under a moral obligation not to inflict serious harm on the highly vulnerable citizens of Africa, India, and elsewhere. Existing proposals for unilateral action on the part of the United States seem to stem from an unruly mixture of confusion, hope, and a sense of moral obligation.
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Recent growth in carbon dioxide emissions from China's energy sector has exceeded expectations. In a major US government study of future emissions released in 2007 (1), participating models appear to have substantially underestimated the near-term rate of increase in China's emissions. We present a recalibration of one of those models to be consistent with both current observations and historical development patterns. The implications of the new specification for the feasibility of commonly discussed stabilization targets, particularly when considering incomplete global participation, are profound. Unless China's emissions begin to depart soon from their (newly projected) business-as-usual path, stringent stabilization goals may be unattainable. The current round of global policy negotiations must engage China and other developing countries, not to the exclusion of emissions reductions in the developed world and possibly with the help of significant financial incentives, if such goals are to be achieved. It is in all nations' interests to work cooperatively to limit our interference with the global climate.
This excerpt describes the intellectual journey that I have taken the last half-century from when I began graduate studies in the late 1950s. The early efforts to understand the polycentric water industry in California were formative for me. In addition to working with Vincent Ostrom and Charles Tiebout as they formulated the concept of polycentric systems for governing metropolitan areas, I studied the efforts of a large group of private and public water producers facing the problem of an overdrafted groundwater basin on the coast and watching saltwater intrusion threaten the possibility of long-term use. Then, in the 1970s, I participated with colleagues in the study of polycentric police industries serving U.S. metropolitan areas to find that the dominant theory underlying massive reform proposals was incorrect. Metropolitan areas served by a combination of large and small producers could achieve economies of scale in the production of some police services and avoid diseconomies of scale in the production of others.
In their comprehensive analysis of the Kyoto Protocol and climate policy, Richard B. Stewart and Jonathan B. Wiener examine the current impasse in climate policy and the potential steps nations can take to reduce greenhouse gases. They summarize the current state of information regarding the extent of global warming that would be caused by increasing uncontrolled greenhouse gas emissions. They explain why participation by all major greenhouse gas-emitting countries is essential to curb future greenhouse gas emissions and also note the significant obstacles to obtaining such participation. Stewart and Wiener argue it is in the national interest of the United States to participate in such a regime, provided that it is well designed. They discuss the elements of sound climate regulatory design, including maximum use of economic incentives, the comprehensive approach, and other flexibility mechanisms; participation by all major emitting countries, including developing countries; regulatory targets based on longer-term emissions pathways set to maximize net social benefits; and effective arrangements to ensure compliance with regulatory obligations by nations and sources. After evaluating the successes and failures of the Kyoto Protocol in light of those elements, the authors propose a series of U.S. initiatives at the international and domestic levels, with the aim of engaging the United States and major developing country emitters such as China in the global greenhouse gas regulatory effort and correcting the remaining defects in the design of the Kyoto Protocol. Although several alternatives to the current Kyoto Protocol regime have been proposed, Stewart and Wiener argue that the best approach for surmounting the current global climate policy impasse is a new strategy that would lead, sooner or later, to simultaneous accession by the United States and China (and other major developing country emitters) to a modified and improved version of the Kyoto Protocol agreement.
This book develops a theory of international cooperation on environmental issues. The theory integrates a number of disciplines, including game theory, economics, international law, and international relations. It explains why treaties are used to address these challenges, and what makes treaties succeed or fail. Treaties can only change behavior by restructuring the incentives that drive behavior. Successful treaties must therefore make it in the interests of countries to participate in and to comply with an agreement demanding substantial changes in behavior such as reductions in pollution emissions. The theory is applied to a number of environmental problems including acid rain, protection of the ozone layer, the management of international fisheries, and the regulation of oil dumping at sea. The concluding chapter, updated in the paperback edition with a new afterword, uses the theory to explain why the Kyoto Protocol will fail to substantially reduce greenhouse gas emissions, and why alternative approaches may work better.
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