Climate Policy and Uncertainty

Abstract

This paper addresses the issue of the global and quantity-based design character of the Kyoto Protocol, where Annex-Parties' commitments are based on national emissions' ceilings and trading (under KP Art. 17) based thereupon. It is argued that the design could have been quite different, e.g. one could have opted for a price-based, or policies-and-measures based approach rather than a quantity-based approach. In addition it is argued that the actual KP design requires a quality level of national GHG emissions (and sequestration) reporting that at present does not generally seem to be met at all. So, it is argued that the present huge uncertainties and error margins in national reporting systems would need to be redressed (and monitoring approved accordingly) considerably in order to allow for a serious international emissions trading system under KP Art. 17.

By contrast, the paper wonders why in the literature the emphasis seems to be more on uncertainties regarding the project-based approach under KP Art. 6 and 12, since the latter can, as it seems, be dealt with relatively easily, and can rely upon best professional judgement systems.