While the European Union (EU) is looking to CO2 emissions by 40% from the levels of 1990, that is a potential sticking point and may see Poland use its veto. In addition to CO2 emission discussions, the assembled leaders will also be looking to set targets for renewable energy as well as efficiency.
While the United Nations will assemble in Paris next year hoping to agree a deal on climate, the chances of that happening will be increased if Europe already has an agreement in place. The meeting being held in Brussels today, and likely into the evening, is focused on the 2030 targets, goals for 2050 are also likely to be discussed.
Up-and-Coming Small- and Mid-cap Portfolio Managers #MICUS (Morningstar Conference)
Notes from Laird Bieger of Baron Capital, Mark Wynegar of Tributary Capital Management, and Amy Zhang of Alger Funds' presentation from the 2020 Monringstar Investment Conference. Q2 2020 hedge fund letters, conferences and more Up-and-Coming Small- and Mid-cap Portfolio Managers Our manager research team has been publishing its semiannual Morningstar Prospects report for several years. Read More
2030 climate targets and Poland
While the EU is calling for a reduction of CO2 by 80-95% for 2050, the group needs to deal with 2030 targets first.
Poland, in its first summit, is expected to put up a fight as the country presently gets 90% of its energy through the burning of coal. Given this, a 40% reduction in carbon emissions by 2030 would prove nearly impossible for the relatively poor nation.
“This issue actually concerns all Poles, because everyone uses electricity,” said newly elected Polish Prime Minister Ewa Kopacz last week.
“That is why, if our conditions are not satisfied, I will have to make a radical move, even though this will be my first summit.” That radical move is certainly the exercising of Poland’s veto.
However, due to a recently leaked draft of the agreement, it’s believed that poorer countries will be offered 10% of the Emissions Trading Scheme (ETS) allowances. Poland and others would be allowed to sell these in order to offset the financial burdens they will face as they move away from coal.
“It seems certain that EU heads of state will agree on a target to reduce greenhouse gas emissions by 40%,” said Brook Riley, from Friends of the Earth in Brussels.
“They will try and pass that off as ambitious but the fact is that it means a 50:50 chance of crossing the 2C temperature threshold.”
Climate targets and Other potential pratfalls
In addition to the “Polish Dilemma,” the meeting will see both Ireland and Portugal arguing for special treatment. Ireland will certainly argue that its carbon-swallowing boglands and forests entitle it to a separate calculation when it comes to carbon emissions. Portugal is interested in more flexibility when it comes to exporting its massive surplus of energy created by renewable sources.
While there are certainly hurdles to get past, pounding out an agreement today will be child’s play compared to the United Nations meeting next year and most experts expect common ground will be reached today.