Paris Climate Conference 2015 *

For current info and documentation on: the Paris Climate Conference 2015

From a game-theorist’s perspective, the UN’s annual Conference of the Parties (COP) might be considered a Conference of the Prisoners. As with the prisoners’ dilemma game, uncooperative behavior should be expected—but is not inevitable. Compared to prisoners in that famous game, the Parties can communicate and can play the game over a longer time-horizon. This helps. But strong cooperation is still impossible—without a common commitment. And a global carbon price is a natural focal point for such a commitment.

A recent Comment in this journal (19 Sept. 2013) suggested “A Patchwork of Emission Cuts” — sometimes called a hybrid approach to the Paris conference of 2015. While this approach requires that countries follow some “rules and build trust”, the “most important quotient would remain domestic political will.”

It criticized the Kyoto Protocol for its top-down approach of agreeing on a climate goal and a legally-binding formula for national targets, and criticized the Copenhagen Accord for relying only on voluntary commitments.

But the top-down approach never happened, and Kyoto failed because it took a hybrid approach. In fact, the Copenhagen Accord also follows this approach since the UN publishes annual pledge quantifications for “collective consideration” which meets the EU’s relatively strict requirement for the hybrid approach.

The hybrid approach to Paris is also now failing as November’s COP 19 in Warsaw did little more than “urge each Party” to “enhance ambition.” Of course, it is in every party’s self interest to exhort others to greater ambition, and then to free ride on their ambition.

The nature of the climate-change dilemma means a patchwork of emission cuts is not enough. Cooperation requires a common commitment. Finding this commitment requires letting go of a well-entrenched bias toward quantity targets and accepting a global carbon price (which should not be confused with a globally harmonized tax).

REPEATING KYOTO

After nearly two years of inventive proposals, the Kyoto negotiators could find no formula to agree on for allocating emission reductions. Finally, Chairman Estrada drew up his own list of targets, based on pledges and negotiating positions, and “invited Annex I Parties to submit their revised, final numbers to the podium.” They submitted whatever they wanted and “these numbers were simply inserted … into the blank draft annex B.”[1] Kyoto followed a hybrid approach.

The current path, as described by US Climate Envoy Todd Stern, allows “countries to self-differentiate by determining the right kind and level of commitment.” Unlike in Kyoto, all countries are invited to participate. While essential, this makes cooperation more difficult, as do the new free-form commitments. Strong commitments require trust that others are not free-riding on your good will, and this requires agreement on a common commitment—a concept still missing since Kyoto’s blinkered failure to find a common quantity-based commitment.