Annex 5 — International climate commitments in Europe

• The Paris Agreement, which was adopted by 195 countries in December 2015, sets a long-term goal of ensuring that the increase in the average global temperature is well below 2 ºC above pre-industrial levels, with the aim of limiting the increase to no more than 1.5 ºC. The agreement is due to enter into force in 2020.
• The European Council has endorsed the objective of reducing Europe's GHG emissions by between 80 % and 95 % by 2050, compared with 1990 levels, in the context of necessary reductions to be collectively achieved by developed countries, according to the IPCC.
• The EU, its Member States and other EEA member countries are committed to limiting or reducing their GHG emissions under international commitments, in particular the UNFCCC and its Kyoto Protocol. For the first commitment period (2008-2012), the EU-15 had a common reduction target of 8 % compared with base-year levels (close to 1990 levels). For the second commitment period (2013-2020), the EU and Iceland committed to cutting their emissions by 20 %, compared with base-year levels, by 2020.

A5.1 The UNFCCC, the Kyoto Protocol and the Paris agreement

In 1992, countries across the globe adopted the UNFCCC to cooperatively consider options for limiting average global temperature increases and the resulting climate change. Under the UNFCCC, developed country parties (Annex I parties) [1] are specifically obliged to commit to adopting national policies and to take corresponding measures for the mitigation of climate change.

The Kyoto Protocol was the first international legally binding agreement signed under the UNFCCC. It specifies the mitigation obligations of the Annex I parties that signed the agreement. It was signed in 1997 and entered into force in 2005. The first commitment period of the Kyoto Protocol ran from 2008 until 2012. In this first period, 37 industrialised countries committed to reducing GHG emissions by an average of 5 % compared with 1990 levels. The EU (comprising 15 Member States at that time) pledged to jointly reduce its GHG emissions by 8% compared with base-year levels. This target was fulfilled.

In Doha, Qatar, in 2012 (at the 18th session of the Conference of the Parties (COP 18) and the eighth meeting of the Parties to the Kyoto Protocol (CMP 8)), the second commitment period (2013-2020) was delineated; the Doha Amendment (UNFCCC, 2012a) includes new QELRCs for Annex I parties intending to take part in the second commitment period. Overall, the Doha Amendment sets an emission reduction objective of 18 % less than 1990 levels for all parties to the Kyoto Protocol for the second commitment period. The Doha Amendment's entry into force is subject to acceptance by at least three quarters of the Parties to the Kyoto Protocol [2]. Although the EU and its 28 Member States, and Iceland, Liechtenstein, Norway and Switzerland (i.e. all EEA countries) agreed on QELRCs for the second commitment period, other countries, such as Canada, Japan, New Zealand and Russia, did not submit targets for the second commitment period (despite having targets under the first commitment period). Overall, emissions by countries with targets for the second commitment period make up only 14-15 % of global emissions (EC, 2013d).

The EU has been at the forefront of international efforts towards a global climate deal. After limited participation in the Kyoto Protocol and a lack of an agreement in Copenhagen in 2009, the EU has been building a broad coalition of developed and developing countries in favour of high ambition; this shaped the successful outcome of the Paris conference (COP 21). The Paris Agreement is a bridge between today's policies and climate neutrality before the end of the 21st century. Governments have agreed on a long-term goal of ensuring that the increase in global average temperature does not exceed 2 ºC above pre-industrial levels, aiming to limit the increase to no more than 1.5 ºC, as this would significantly reduce risks and the impacts of climate change.

Before and during the Paris conference, countries submitted comprehensive national climate action plans (INDCs). These are not yet sufficient to keep global warming levels below 2 ºC, but the agreement will help towards achieving this target. The EU was the first major economy to submit its intended contribution to the new agreement, in March 2015. It is already taking steps to implement its target to reduce emissions by at least 40 % by 2030. The agreement entered into force on 4 November 2016, when 55 countries, which collectively account for at least 55 % of global emissions, had deposited their instruments of ratification. As of July 2017, 153 of 197 countries have ratified the Paris Agreement.

A5.2 Progress of the European Union under the second commitment period of the Kyoto Protocol (2013-2020)

For the second commitment period of the Kyoto Protocol, the EU, its 28 Member States and Iceland agreed to a joint QELRC corresponding to a 20 % reduction compared with the base year; they declared that they intended to fulfil this commitment jointly, under Article 4 of the Kyoto Protocol. The three other EEA member countries, Liechtenstein, Norway and Switzerland, also agreed on QELRCs for the second commitment period.

The Council adopted, on 13 July 2015, the legislation necessary for the EU to formally ratify the second commitment period of the Kyoto Protocol. The Council adopted two decisions:

• Council decision on the ratification of the Doha Amendment to the Kyoto Protocol establishing the second commitment period;
• Council decision on the agreement between the EU, its Member States and Iceland, necessary for the joint fulfilment of the second commitment period of the Kyoto Protocol.

In parallel with ratification by the EU, the individual Member States and Iceland will finalise their national ratification processes; however, the second commitment period has not yet been ratified by the EU.

Table A5.1 Emission reduction commitments by EU and EEA countries for the Kyoto Protocol's second commitment period (2013-2020)

Note: QELRC, quantified emission limitation and reduction commitment.

Source: UNFCCC, 2012b.

A5.3   Methodological details related to targets under the Kyoto Protocol and the UNFCCC

A5.3.1  Second commitment period

The main amendments to Kyoto Protocol rules for the second commitment period (from 2013 to 2020), compared with the rules that were applicable in the first commitment period (from 2008 to 2012), are as follows:

• In addition to the gases covered in the first commitment period, the target for the second commitment period also covers NF₃.
• An ambition mechanism allows a party to adjust its commitment by increasing its ambition during a commitment period.
• Surplus assigned amount units (AAUs) from the first commitment period of the Kyoto Protocol can be carried over according to specific accounting rules (for further details, see EEA, 2014b).
• The AAUs of a party for the second commitment period can be adjusted in order to prevent an increase in its emissions for the 2013 to 2020 period, beyond its average emissions for the years 2008-2010.
• There are new accounting rules for emissions removals from LULUCF, in accordance with the relevant decisions made at COP 17 in Durban (UNFCCC, 2012a).
• Emissions of non-CO₂ gases are converted into CO₂-equivalent emissions using the GWP values included in the AR4 (IPCC, 2007).

However, a number of rules are unchanged for the second commitment period. As in the first commitment period, the target for the second commitment period refers to 1990 as a single base year, but it allows for different base years according to the flexibility rules for fluorinated gases (F-gases) and economies in transition (as described above). For the newly added GHG NF₃, either 1995 or 2000 may be used as the base year. Base years for individual Member States have not yet been set for the second commitment period. The use of certified emission reductions (CERs) from the clean development mechanism, emission reduction units (ERUs) [3] from joint implementation projects and the possible recognition of units from new market-based mechanisms are all possible to achieve targets (still capped under EU domestic legislation). Sector coverage remains the same.

A5.3.2  Convention (the United Nations Framework Convention on Climate Change)

In 2010, the EU submitted a pledge to reduce its GHG emissions by 20 % by 2020, compared with 1990 levels, to contribute to achieving the ultimate objective of the UNFCCC: 'to stabilise GHG concentrations at a level that would prevent dangerous anthropogenic (human-induced) interference with the climate system', or, in other words, to limit the global temperature increase to less than 2 ºC above temperature levels before industrialisation. The EU clarified that the accounting rules for its target under the UNFCCC are more ambitious than the current rules under the Kyoto Protocol; for example, international aviation has been included, an annual compliance cycle for emissions under the ESD has been added, and there are higher quality standards for emission credits from the Kyoto Protocol's clean development mechanism (CDM) used under the ETS (UNFCCC, 2013b). Accordingly, the following assumptions and conditions apply to the EU's target of a 20 % reduction under the UNFCCC:

• Emissions or removals from LULUCF are not included (but moving to the higher target of 30 % would require some contribution from LULUCF).
• The target refers to 1990 as a single base year, not allowing for different base years for F-gases or economies in transition, as under the Kyoto Protocol.
• Emissions from international and domestic aviation are partly included in the target; furthermore, the target covers the IPCC sectors of energy, industrial processes and product use (IPPU), agriculture and waste.
• A limited number of CERs, ERUs and units from new market-based mechanisms may be used to achieve the target: under the EU ETS, the use of international credits is capped (up to 50 % of the reduction required from EU ETS sectors by 2020 can be achieved through the use of carbon credits). Quality standards also apply to the use of international credits in the EU ETS, including a ban on credits from LULUCF projects and certain industrial gas projects. In the ESD sectors, the annual use of international credits is limited to up to 3 % of each Member State's ESD emissions in 2005, with a limited number of Member States being permitted to use an additional 1 % from projects in LDCs and SIDS, subject to conditions. These caps thus define the concept of the supplementary use of market-based mechanisms for the fulfilment of targets, and indicate that the EU applies more ambitious rules with regard to the use of market-based mechanisms towards its target under the UNFCCC than would be applied in the context of the Kyoto Protocol.
• The carry-over of surplus AAUs from the first commitment period of the Kyoto Protocol is not possible (but surplus EU emission allowances allocated under the EU ETS can be banked from the period 2008-2012into subsequent periods).
• The target covers the gases CO₂, methane (CH₄), nitrous oxide (N₂O), hydrofluorocarbons (HFCs), perfluorinated compounds (PFCs) and sulfur hexafluoride (SF₆), consistent with the GHGs covered under the reporting requirements under the convention (UNFCCC, 2013b).

A5.4   Land use, land use change and forestry activities under the Kyoto Protocol

In addition to policies and measures that target sources of GHG emissions, countries can use policies and measures to protect their existing terrestrial carbon stocks (e.g. by reducing deforestation), and further enhance terrestrial carbon stocks (e.g. by increasing the area or carbon density of forests).

The following LULUCF activities are included under the Kyoto Protocol:

• Afforestation, reforestation and deforestation (ARD) since 1990 (mandatory activities covered by Article 3.3 of the Kyoto Protocol), for land that has been subject to direct, human-induced conversion from a non-forest to a forest state, or vice versa, are included.
• Forest management (FM), cropland management (CM), grazing-land management (GM) and revegetation (RV) are included. Although CM, GM and RV are voluntary, FM has been a mandatory activity since the second commitment period under Article 3.4 of the Kyoto Protocol. These activities pertain to land that has not undergone conversion since 1990 but is otherwise subject to a specific land activity. Parties account for net emissions or removals for each activity during the commitment period by issuing removal units (RMUs) [4], in the case of net GHG removals from LULUCF activities, or by cancelling Kyoto units in the case of LULUCF activities that are a net source of GHG emissions. LULUCF activities can therefore be used to offset emissions from other sources if removals are higher than emissions from this sector. In the first commitment period, the number of RMUs that could be issued by each party under FM was capped (UNFCCC, 2006). For the second commitment period, FM activities are accounted for against an 'FM reference level', i.e. a country-specific level of business-as-usual emissions or removals. RMUs are issued only if FM removals are higher or emissions are lower than the agreed FM reference level. Otherwise, Kyoto units are cancelled.

RMUs can be accounted for at the end of a commitment period or annually. According to Decision 13/CMP.1, parties must indicate the frequency of accounting with their initial reports. For each activity under Article 3.3 and Article 3.4, parties have elected to account for emissions or removals either annually during the commitment period, or only once at the end of this period. The decision on frequency of accounting determines when parties can issue RMUs or cancel other units in the case of emissions from Article 3.3 and Article 3.4 activities.

For the second commitment period, new accounting rules apply for the accounting of emissions and removals in the LULUCF sector. In particular, additional activities for wetland management can be accounted for on a voluntary basis. Guidelines for these new rules were developed by the IPCC and adopted by the UNFCCC. Subsequently, the rules were almost entirely transferred into EU law in the form of EU Decision 529/2013/EU 'on accounting rules on greenhouse gas emissions and removals resulting from activities relating to land use, land use change and forestry and on information concerning actions relating to those activities' (EU, 2013c). This legislation harmonises EU reporting on LULUCF with Kyoto Protocol requirements, but it also goes beyond these requirements. Under EU rules, Member States must also report on agricultural activities (CM and GM), irrespective of whether or not these activities are elected under the Kyoto Protocol.

LULUCF emissions and removals are not included in the EU domestic 2020 target under the climate and energy package. The rules from the First and Second Commitment Period of the Kyoto Protocol and from Decision 529/2013/EU, however, form the basis for the integration of LULUCF into the EU's 2030 climate framework.

A5.5   Emissions from aviation

Although GHG emissions from domestic and international aviation have been partly included in the EU's target under the UNFCCC since 2012 as part of the EU ETS, only emissions from domestic aviation are included in its targets under the Kyoto Protocol. Domestic aviation from the EU Member States amounts to less than 0.5 % of total GHG emissions without LULUCF, whereas the international aviation of EU Member States totals about 3 % of total emissions.

In principle, the EU ETS covers all flights arriving at, and departing from, airports in all EU Member States, Norway, Iceland and Liechtenstein and closely related territories. However, since 2012, flights to and from airports in other countries have not been included in the EU ETS. This exclusion, first resulting from the 'stop the clock' decision (EU, 2013d), was made to facilitate the negotiation of a global agreement on aviation emissions in autumn 2013 by the General Assembly of the International Civil Aviation Organization (ICAO). At its 38th meeting in autumn 2013, ICAO decided on a roadmap for the development of a global market-based mechanism to tackle aviation emissions. In 2016, ICAO agreed on a Resolution for a global market-based measure to address CO₂ emissions from international aviation as of 2021. The agreed Resolution sets out the objective and key design elements of the global scheme, as well as a roadmap for the completion of the work on implementing modalities. The Carbon Offsetting and Reduction Scheme for International Aviation, or CORSIA, aims to stabilise CO₂ emissions at 2020 levels by requiring airlines to offset the growth of their emissions after 2020.

The EU decided to continue with a reduced scope in the period 2013-2016 (EU, 2014b). Only flights between airports located in countries in the European Economic Area are included in this scope. Flights to and from outermost regions, as per Article 349 of the Treaty on the Functioning of the European Union (TFEU), are covered if they occur only in the same outermost region. In light of the progress on the global measure, the European Commission has proposed continuing the current approach beyond 2016. This proposal is currently considered by the European Parliament and the Council of the European Union.

More than 1 200 aviation operators are currently included in the EU ETS. The cap for aviation in the EU ETS is based on average historical emissions in this sector between 2004 and 2006 (221.4 Mt CO₂ for all participating countries) [5]. The cap for the period 2013-2020 is equivalent to 95 % of baseline emissions (EU, 2009b). Whereas aircraft operators may use EU aviation allowances (EUAAs) as well as EU allowances (EUAs) from the stationary sectors, stationary installations are not permitted to use aviation allowances for compliance. In addition, some international credits can be used by aircraft operators: up to 14 % of their verified emissions in 2012, and, from 2013 onwards, each aircraft operator is entitled to use international credits up to a maximum of 1.5 % of its verified emissions during the period from 2013 to 2020, without prejudice to any residual entitlement from 2012.

> For all sources, see the bibliography page

Footnotes