Politics lie at the centre of the allocation process for CO2/GHG (carbon dioxide and greenhouse gas) reduction targets and quotas in the European Union (EU). Though most presumably agree that EU allocation of CO2/GHG reduction targets and quotas should both equalize (burden- sharing principle) and minimize the impact across individual states, the process by which state-by-state quotas are allocated is anything but transparent. Moreover, judging by the response of 8 of the 10 New Member States (NMS’s) to the CO2/GHG quotas allocated for the 2008–2012 period or by the response of most of the NMS’s to the current country-level GHG emission reduction targets proposed as part of the EU’s 2020 Climate Change Package introduced on January 23, 2008, the process appears potentially tilted toward the interests of the Old Member States (OMS’s). The veracity of this claim aside, the relative lack of transparency in the decisionmaking process begs the question both of whose interests are most strongly represented in the final burden-sharing and quota allocation and why this is so.
This paper investigates both why EU member states are strongly divided over CO2/GHG reduction targets and quota allocations as well as whose interests are most strongly represented in the current structure of EU allocations. Interest divergence is clearly most strongly felt at and below the national level of interest formation. Yet, what defines the foundation for such interest divergence remains both under-researched and controversial. Any number of factors—the relative energy mix (coal, oil, nuclear, renewable or other form), the form of carbon mitigation promotion at the national level, or relative export carbon intensity—can potentially influence the relative interests of individual countries. Comparatively little attention, however, has been paid to the core problem of variation in relative levels of economic development.
This paper analyzes those factors that best explain the division of interests across countries, with a particular focus on the division of interests resulting from comparative levels of economic development. For multiple reasons, Central and East European (CEE) NMS’s are likely to view CO2/GHG emission reduction targets and quota restrictions as real constraints on future economic growth. For one, CO2/GHG quota allocations may impose significant constraints on future economic convergence goals. While such constraints are potentially avoidable through the mass-scale introduction of renewable energy and comparable scale energy efficiency improvements, these represent comparatively high-cost strategies (in particular in up-front costs). For comparatively less advanced countries facing significant budgetary constraints (in particular the EMU convergence criteria), these challenges are significant.
This paper first reviews the problem of supra- and international cooperation— in particular with respect to transboundary issues like climate change. For the purposes of comparison, the first section briefly outlines some of the problems at the root of conflict over climate change policy at the international level. The interests of states appear as the most significant obstacle to real progress in attempts to outline the parameters of the follow-up to the Kyoto agreement. The second section then focuses on the example of the EU and asks whether things decision-making processes have differed significantly from those at the international level. While the institutions structure of the EU is clearly more advanced than that at the international level, it is not clear that this ultimately has a deci6 sive impact on the ability to share burdens more equitably across the member states. This point is then illustrated on the basis of three examples taken from the general framework of the EU’s climate-change policy.
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http://www.vki.hu/workingpapers/wp-186.pdf