Governing complexity: How can the interplay of multilateral environmental agreements be harnessed for effective international market-based climate policy instruments?
Major new multilateral environmental agreements (MEAs) have entered into force in 2016, including the Paris Agreement (PA) under the United Nations Framework Convention on Climate Change (UNFCCC) with nationally determined contributions (NDCs) for greenhouse gas (GHG) reduction, the Kigali Amendment (KA) to the Montreal Protocol with a phase-down schedule for HFC production and use in all countries as well as the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) under the International Civil Aviation Organization, an offset mechanism for GHG emissions. Regarding climate change mitigation, these MEAs are implicitly and explicitly linked to each other. However, the interaction effects between them have not yet been studied. We apply document analysis to assess the following question: how does the MEA interplay impact the scope and effectiveness of international market-based climate policy instruments defined in Article 6 of the PA (Paris Mechanisms) regarding NDC achievement? The Paris Mechanisms can generate early reductions in HFCs that lower the KA baseline and thus the entire phase-down schedule, thereby generating long-term GHG mitigation. Reduction in HFC-23—a large, controversial source of carbon credits under the Kyoto Protocol’s Clean Development Mechanism (CDM)—is now mandated through the KA and thus no longer available for international market mechanisms. If it accepts CDM credits predating 2020, CORSIA will not generate demand for emission units generated by the Article 6 mechanisms and thus not impact their effectiveness. Otherwise, CORSIA demand for Article 6 credits enhances effectiveness, provided that ‘double counting’ of credits is prevented through corresponding adjustments.
KeywordsInterplay Climate change mitigation Paris Agreement Kigali Amendment CORSIA Market mechanisms
Convention on Biological Diversity
Common but Differentiated Responsibilities
Clean Development Mechanism
- CDM EB
Clean Development Mechanism Executive Board
Carbon dioxide equivalent
Carbon Offsetting and Reduction Scheme for International Aviation
Environmental Protection Agency
- EU ETS
European Union Emissions Trading System
Green Climate Fund
Global Environment Facility
Global warming potential
International Civil Aviation Organization
Institute for Governance and Sustainable Development
International Institute for Sustainable Development
Intergovernmental Panel on Climate Change
Multilateral Environmental Agreement
- MP Fund
Multilateral Fund for the Implementation of the Montreal Protocol
Monitoring, reporting and verification
Nationally determined contribution
Poly urethane foam
Refrigeration, air-conditioning and foam
Standards and Recommended Practice
Sustainable Development Mechanism
Transformative Ambitionssteigerung – Der Beitrag effektiver Klimapolitikinstrumente
Trade-Related Aspects of Intellectual Property Rights
United Nations Environment Programme
- UNEP DTU
United Nations Environment Programme Danish Technical University
United Nations Framework Convention on Climate Change
United States Dollar
Vienna Convention for the Protection of the Ozone Layer
World Meteorological Organization
We would like to thank the German Ministry of Education and Research for funding the project ‘Transformative Ambitionssteigerung – Der Beitrag effektiver Klimapolitikinstrumente (TABEK)’ (01LS1621A) in whose context this article has been written.
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