Kyoto Protocol's Shortcomings

This week in Montreal, the stars of the world environmental movement will gather to celebrate their greatest victory - consummation of the Kyoto Protocol - and to plan their next steps in the war against GLOBAL WARMING.

Kyoto Protocol's Shortcomings

This week in Montreal, the stars of the world environmental movement will gather to celebrate their greatest victory - consummation of the Kyoto Protocol - and to plan their next steps in the war against GLOBAL WARMING. After an exhaustive seven-year fight, the treaty came into force earlier this year, and its single-minded focus on reducing carbon emissions is now the central organizing principle of Greens everywhere. At this week's United Nations Climate Change Conference, a long line of academics, bureaucrats and celebrity scientists like David Suzuki will issue a call for deeper, faster and more costly cuts to greenhouse gases. But another faction of economists and lawmakers will also be there, arguing that the case for Kyoto has fallen apart.

These critics are not the usual diehards and pseudo-scientists who deny the very existence of global warming and the greenhouse effect. They are environmentalists who believe Kyoto is a dangerously flawed agreement - an enormously expensive political document, full of loopholes and exceptions, that will divert the world's attention from more dangerous forms of air pollution, while doing little to address the long-term trajectory of climate change. The most prominent voice in this emerging school of "environmental economists" is Danish academic Bjørn Lomborg, architect of last year's Copenhagen Consensus project, which argued against the Kyoto Protocol. Lomborg and others have crunched the numbers on climate change, and say the preoccupation with carbon dioxide emissions may be leading the world down a dangerous path. "Global warming is real and it is a problem," Lomborg says. "But the central problem of the Kyoto Protocol is that it will achieve very little at a very high cost. It's just not a good way of dealing with the problems we're facing."

That conclusion is being bolstered by a growing pool of research suggesting that the meagre social and health benefits of the Kyoto Protocol are far outweighed by its staggering economic costs. Prof. Robert Mendelsohn at Yale University is an economist who has dedicated much of his career to quantifying the economic costs of environmental damage, and has emerged as one of North America's most respected critics of the Kyoto approach. Mendelsohn is one of dozens of prominent academics who have tried to quantify the value of equatorial ecosystems threatened by long-term global warming, taking into account likely adaptations to climate change, and discounting the costs back to arrive at a present-day value. According to Mendelsohn's research, every tonne of carbon dioxide released into the atmosphere does approximately US$5 of present-day damage to the environment. And once you look at the problem on that basis, he says, countries like Canada should be limiting their spending to a maximum of US$5 per tonne to reduce emissions. "The trick is not to commit to a draconian program to solve this long-term problem immediately," Mendelsohn wrote last year. "Draconian programs are extremely poor investments. The world simply should not support such extreme measures when there are so many other pressing issues at hand."

From Mendelsohn's perspective, Canada's plan would certainly qualify as draconian. Canada has agreed to reduce its carbon emissions to six per cent below 1990 levels by 2010 - a cut of approximately 270 to 300 megatonnes. Ottawa has provided few specifics on how it plans to meet that goal, but in April it released its first projections of how much it will spend. Through three main initiatives - a Climate Fund, a Partnership Fund, and a collection of smaller programs aimed at improving energy efficiency - the government will pay up to $10 billion to cut up to 240 megatonnes. That works out to $41.66 for every tonne, or almost eight times the amount that Mendelsohn considers justified. And that number does not include the money that corporations will have to spend in order to meet Canada's Kyoto commitments, or the lost economic opportunity caused by curtailing growth.

And for what? Even hard-core Kyoto believers acknowledge the agreement will achieve little on its own. For one thing, the treaty only applies to a handful of rich nations - particularly Canada, members of the European Union, and Japan. Major polluters in the developing world, including China and India, are not required to make any reductions, and the world's biggest emitter, the United States, did not ratify the treaty. As a result, worldwide emissions will only be cut by roughly five per cent from current levels at the most. "Kyoto is a mere drop in the bucket," says Nigel Roulet, a professor of geography and director of McGill University's school of environment. "The agreement will delay the doubling of carbon dioxide in the atmosphere by 10 to 15 years. To really stop global warming, you don't need a six per cent reduction, you need 60 or 70 per cent. Is that feasible? We need to start talking about the costs of climate change versus the costs of stopping it."

As it stands now, those costs are not well understood. In general, it appears that countries closer to the equator will be hardest hit, while countries like Canada and Russia might actually benefit from longer growing seasons and more arable land. And yet, Canada is being asked to carry a disproportionate share of Kyoto's costs, critics say. Under the treaty, European nations agreed to cut gases by about eight per cent from current levels, and Japan by about five per cent. Russia can actually substantially increase emissions, and will likely turn Kyoto into a money-maker by selling so-called emissions credits to the rest of the world. Canada, which represents less than two per cent of global emissions, must cut its release of gases by 24 per cent from 2003 levels. "Some countries got off light and some took a very heavy burden," Mendelsohn says. "Canada will be in a particularly disadvantageous position because not only are you spending more than it makes sense to spend, you'll be spending a lot more than everybody else."

Still, Canada's leading environmental activists are demanding Canada commit to even deeper cuts, at a potentially massive cost, to set an example for the rest of the world. Last week, the David Suzuki Foundation released a new report calling for greenhouse gas releases to be cut to 25 per cent below 1990 levels by 2020, and 80 per cent by 2050.

More worrisome than what Kyoto does, however, is what it fails to do, experts say. Most scientists agree the most dangerous environmental air pollutants today are microscopic particulates that come from car engines and combustion-based power plants, but these pollutants are largely ignored by the Kyoto Protocol. The two most common causes of particulates are sulphur dioxide (SO2) and nitrogen oxides (NOx) - chemicals with a litany of well-documented health effects, from chronic bronchitis and asthma to lung cancer and various forms of heart disease. Sulphur dioxide causes acid rain and nitrogen oxides are major contributors to urban smog.

Last year, the city of Toronto released a study estimating that particulate air pollution contributes to approximately 1,700 premature deaths and 6,000 hospitalizations in the city every year. A 2002 California study released by the American Lung Association suggested air pollution contributes to almost as many deaths and hospitalizations in that state as traffic accidents. "In the United States, 135,000 people die every year from exposure to particulate air pollution," Lomborg says. "In many ways, this is our biggest environmental problem. It's gotten a lot better in the past 30 years, but we could do a lot more good, fairly cheaply."

Particulates, smog and acid rain used to be the environmental threats that preoccupied North America, and thanks in large part to the Canada-U.S. Air Quality Agreement of 1991, a huge amount of progress was made through the 1990s. Between 1980 and 2001, Canada and the U.S. cut sulphur dioxide emissions by 48 per cent and 39 per cent respectively. Nitrogen oxides were similarly slashed. But those long-term improvements belie more worrying trends. For example, in Ontario the absolute level of nitrous oxide has declined, but it has increased in dense urban areas like Toronto. And in the U.S., sulphur dioxide levels edged back up between 2002 and 2003.

Ross McKitrick, an economist at the University of Guelph and staunch Kyoto critic, compared the current obsession with carbon dioxide with other more dangerous chemicals in a 2003 paper attacking the rationale behind the protocol. "It is important to remind ourselves that CO2 is not a pollutant," he wrote. "Noxious air contaminants, like SO2, NOx, ozone and smoke particles, cause direct damages to health." And unlike sulphur and nitrogen oxides, carbon dioxide can't be "scrubbed" out of emissions using existing technology. The only way to reduce it is to stop burning fossil fuels.

Lomborg's research suggests that the U.S. and Canada could make substantial improvements to air quality by requiring particulate filters on all diesel engines, for a fraction of the cost of Kyoto - perhaps as low as US$25 billion in the U.S. and about $3 billion in Canada. But cost-benefit analysis is not part of the current environmental mindset, he says. To the activist groups, global warming is the only environmental threat that really matters, and Kyoto is the only game in town. The U.S., however, is trying to change all that.

Four years ago, President George W. Bush formally rejected the protocol because, he said, the deal would cost the U.S. economy US$400 billion and almost five million jobs. When he suggested a package of voluntary programs and incentives for cleaner fuels, and an environmental program focused on toxic air pollution rather than CO2, he was roundly attacked by environmental groups. But recent studies by the U.S. Environmental Protection Agency suggest Bush may have had the right idea after all. In October, the EPA released an exhaustive study of various air pollution plans, and said Bush's Clear Skies package - which targets particulates and mercury but doesn't specifically regulate CO2 - would cost utilities up to US$6 billion to implement, but would pay off with up to US$143 billion in health benefits by 2020.

Not surprisingly, this approach is winning a lot of fans in the developing world, where particulate air pollution is already killing tens of thousands in the choked cities of India, China and Korea, and where the next phase of Kyoto threatens to undermine an economic awakening a century in the making. This summer, the two leading Kyoto dissenters - Australia and the U.S. - joined with China, India, Japan and South Korea to form the Asia-Pacific Partnership for Clean Development. The pact is built around voluntary measures to develop and share less polluting technologies and reduce the "carbon intensity" of economies.

On the surface, it seems to be the kind of deal environmentalists would cheer. But in the age of Kyoto, anything that questions the wisdom of the accord is attacked. Jacqueline Karas, with the Royal Institute of International Affairs in London, told the BBC that the new pact was inadequate because it's built around "technology for tomorrow rather than cuts for today." She also suspected that the deal was "timed to attempt to undermine negotiations in Montreal." Philip Clapp of Washington's National Environmental Trust said it was a "disturbing" attempt to organize nations into a bloc opposed to extending Kyoto.

But to an increasing number of environmentalists, technology for tomorrow is the only realistic way to tackle the global warming juggernaut. Kyoto succeeded in putting the issue on the international agenda, says McGill's Roulet, but now it's time to change tacks and concentrate on fundamental change. Canada "doesn't have a hope in hell" of meeting its current Kyoto targets, let alone another round of deeper cuts, he says. That point was driven home last week when the province of Alberta announced it would not enforce Ottawa's new greenhouse gas regulations.

Instead of limits and penalties, the next step against climate change must be an international "Manhattan Project for alternative energy," Roulet says. "We need to find a non-fossil fuel, non-carbon-producing form of energy or we will face a choice: warm the planet or crush the economies of the developed world." Agrees Lomborg: "It's not about cutting carbon emissions now; it's about making sure that our grandkids don't use fossil fuels in the future. That means investing in energy research and development in renewable technologies. This kind of investment would cost one-tenth of Kyoto at the maximum and have a much greater impact on global climate than Kyoto ever could."

Whether the Kyoto freight train can be diverted is an open question. But Mendelsohn, for one, isn't expecting a drastic change of direction soon. Those demanding deep and immediate cuts to CO2 are still the majority, he says, and changing minds is a slow process when science gets clouded by emotion. "There is still this mood in the community that climate change is evil, and has to be stopped aggressively," he says. "They don't like to hear anything that gets in the way of that." The danger, of course, is that the road to calamity may be paved with the best intentions of the most devout environmentalists.

Maclean's December 5, 2005