Long reeling under indefinite delays and lack of consensus at the various talks, the Kyoto protocol has been given a new lease of life. The protocol, set to expire in 2012 had not been renewed for some time now as the various nations of the world could not agree on the contents of a legally binding treaty to reduce emissions. As it stands, the various developing nations of the world are not legally required to cut their greenhouse gas emissions but are expected to cut their emissions voluntarily. The developed nations on the other hand are required to make significant cuts by 2020.
The developed nations, led (or comprising only of) US voiced their opinion that the emissions reductions for developing nations should be made mandatory and legally binding. Any decision short of this would not be considered. Countries such as China and India which are number 1 and 3 on the list in absolute terms have extremely low per capita emissions – 5.3 tonnes and 1.4 tonnes respectively, while US has per capita emissions of 17.5 tonnes. The developing nations feel that they should not be legally bound to reduce emissions while they are still fighting for economic growth, while the developed nations feel otherwise. This point of differentiated responsibility has for a long time remained one of the stumbling blocks to come up with a new treaty, which (to a certain extent) has been resolved during the recent round of talks.
The agreement at Durban has made all emissions cuts for the near term voluntary as opposed to a top-down system of specified targets. This has provided much needed impetus to the carbon trading segment. The biggest producers of CERs – India and China have agreed to cut down emissions but a definite number would be settled on at a later date. The biggest beneficiaries of the latest round of talks are the players involved in carbon trading. The CER price which has dropped by about 54% over the past few years due to uncertainties in the climate change commitments is expected to shoot up again as there seems to be a stronger demand for these carbon credits now that the negotiations have been fruitful.
This is also good news for the developing economies as it would help them cut emissions in a more streamlined manner through technology transfer from developed nations as well as financial aid to combat climate change. Further it was also agreed to develop a monitoring system for international monitoring of each country’s emission cutting measures. This proves to be good news to the environment as nations make more serious efforts to curb emissions.