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2.2.2 Annex I countries

RELEASED UNDER THE OFFICIAL INFORMATION ACT

This section describes emissions profiles and projections and climate change policies in selected Annex I countries. Annex I countries are broadly industrialised economies. Those Annex I countries that have ratified the Kyoto Protocol have emissions reduction obligations under the Protocol to the UNFCCC. These issues are described in more detail in Section 2.1.1.

United States

Emissions profile and trends

The United States is the world’s largest economy, accounting for over one-quarter of the global economy. The United States is also the world’s largest energy consumer and the largest greenhouse gas emitter. In 2002, the United States emitted over 6,900Mt CO2e of greenhouse gas emissions, approximately one-fifth of global emissions. The United States’ emissions profile is shown in the graph below. Total energy emissions (comprising electricity and heat, manufacturing and construction, transportation, other fuel combustion and fugitive emissions) add up to 85.3% of overall emissions.

Figure 1 - Greenhouse Gas Emissions by Sector in the United States 2002

Electricity and heat: 33%. Manufacturing and construction: 14%. Transportation: 26%. Other fuel combustion: 10%. Fugitive emissions: 3%. Industrial processes: 4%. Agriculture: 7%. Waste: 3%.

Source: World Resources Institute (http://cait2.wri.org/wri)

Between 1990 and 2002, the growth of the United States economy meant that emissions grew by 1.0% per year even though emissions intensity declined. Approximately 85% of United States energy is produced through fossil fuel combustion. The remaining 15% comes from renewable sources such as hydropower, biomass and nuclear energy.

Total United States greenhouse gas emissions are projected to increase by 43% between 2000 and 2020, reflecting continued growth in the economy, while emissions intensity (emissions per unit of GDP) is projected to continue to decline during this period. From 2000 to 2020, energy-related CO2 emissions are projected to increase by 37%, compared with cumulative projected economic growth of 80%. It is anticipated that oil will remain the most used fuel, continuing to account for around 40% of total primary energy consumption over the projection period.

Mitigation responses

While the United States has not ratified the Kyoto Protocol, its Government has placed a strong emphasis on research and development of new technologies to reduce emissions. Energy efficiency is also considered a priority. Key actions to reduce emissions, as reported in the United States’ third national communication to the UNFCCC in 2002, include:

  • promoting greenhouse gas reductions through the development of cleaner, more efficient technologies for electricity generation and transmission, including supporting the development of renewable resources such as solar energy, wind power, geothermal energy, hydropower, bioenergy and hydrogen fuels
  • promoting the development of fuel-efficient motor vehicles and trucks, research and development options for producing cleaner fuels, and implementation of programmes to reduce the number of vehicle miles travelled
  • implementing partnership programmes with industry to reduce emissions of carbon dioxide, including through use of combined heat and power
  • voluntary partnership programmes promoting energy efficiency in commercial, residential and government buildings through technical assistance, as well as the labelling of efficient products, new homes and office buildings
  • conservation programmes aiming to reduce agricultural emissions, sequester carbon in soils, and offset overall greenhouse gas emissions
  • reducing greenhouse gas emissions from energy use in federal buildings and the federal transportation fleet.

The United States is seeking to work with other countries to share and disseminate information on technologies internationally, and has established the International Partnership on the Hydrogen Economy and the Carbon Sequestration Leadership Forum to coordinate international efforts in these areas.

The 2006 Budget proposed $US5.5 billion for climate change programmes, including the Climate Change Technology Program, the Climate Change Science Program, and climate change-related international assistance programmes. The Budget also proposed energy tax incentives that promote greenhouse gas emissions reductions totaling $US3.6 billion over five years. The incentives are designed to spur the use of cleaner, renewable energy and more energy-efficient technologies that reduce greenhouse gas emissions. The tax incentives include credits for the purchase of hybrid and fuel-cell vehicles, residential solar heating systems, energy produced from landfill gas, electricity produced from alternative energy sources such as wind and biomass, and combined heat and power systems.

Targeted incentives are also provided to encourage wider use of land management practices that remove carbon from the atmosphere or reduce emissions of greenhouse gases.

Australia

Emissions profile and trends

Australia’s greenhouse gas emissions are shown in the graph below. Total emissions in 2002 equated to 517Mt CO2e. Total energy emissions (comprising electricity and heat, manufacturing and construction, transportation, other fuel combustion and fugitive emissions) add up to 71.8% of overall emissions.

Figure 2 - Greenhouse Gas Emissions by Sector in Australia 2002

Electricity and heat: 40%. Manufacturing and construction: 8%. Transportation: 15%. Other fuel combusion: 4%. Fugitive emissions: 6%. Industrial processes: 4%. Agriculture: 20%. Waste: 3%.

Source: World Resources Institute (http://cait2.wri.org/wri)

Livestock are the principal source of emissions within the agricultural sector. Land-use change and the forestry sector are a net source of emissions in Australia rather than a net sink (although this is not represented in the graph above).

Australia is very dependent on fossil fuels for energy – they account for nearly 94% of Australia’s energy inputs. Australia has an abundant coal resource and, consequently, its reliance on coal for energy (in particular, brown coals or lignites) is double the OECD average. This is exacerbated by limited hydro-resources, and public and environmental concerns preventing the use of nuclear energy.

Between 1990 and 2002, Australia’s emissions grew by 1.7% per annum. Based on projections reported in Australia’s third national communication to the UNFCCC in 2002, emissions across all sectors are estimated to reach 580Mt CO2e in 2010 – a 16% increase over 1990 levels. The projection of emissions includes greenhouse gas abatement from policy measures that are projected to deliver, in aggregate, a reduction of 59Mt CO2e in 2010.

Australia has not ratified the Kyoto Protocol and therefore is not bound by its emissions targets. Nevertheless, an assessment of Australia’s emissions projections according to Kyoto target rules shows that over the period 2008 to 2012, emissions will be 11% above 1990 levels on average, indicating that Australia would exceed its Kyoto target of 8% above 1990 levels.

Mitigation responses

Australia has established a whole-of-government Commonwealth agency – the Australian Greenhouse Office – to coordinate climate change policy and deliver greenhouse programmes. It has developed a strategic framework of policies and measures for advancing its domestic greenhouse action across all sectors of the economy – the National Greenhouse Strategy. Under the National Greenhouse Strategy, 86 individual measures are grouped into eight sectoral “modules” and reflect a broad range of policy approaches, from voluntary action and strategic investment to regulation and market measures.

Mitigation programmes include:

  • the $AU400 million Greenhouse Gas Abatement Program (GGAP) established in 1999, which supports large-scale, cost-effective and sustained abatement by industry and the community
  • the Greenhouse Friendly Program, a voluntary certification and labelling initiative designed to engage consumers on climate change issues and greenhouse gas abatement
  • strategies to improve the efficiency of energy supply and use, including efficiency standards to move fossil-fuel electricity generators toward best practice, an Energy Efficiency Best Practice Program for key sectors, minimum energy-efficiency standards in the Building Code of Australia, and comparative energy labelling and minimum energy-performance standards for domestic appliances, commercial products and industrial equipmen
  • the Mandatory Renewable Energy Target, which was introduced in 2000 and requires wholesale energy purchasers to purchase increasing amounts of electricity generated from renewable sources, towards a target more than 50% above 1997 levels of renewable energy generation by 2010
  • a National Green Power Accreditation Program established by a number of state and territory governments, under which electricity customers can elect to pay a premium to their energy retailers for the supply of electricity generated from renewable sources
  • rebate programmes for solar hot water heaters, implemented by several states and territorie
  • a fuel consumption labelling scheme introduced by the Commonwealth in January 2001, under which all new cars sold in Australia are required by law to carry a fuel consumption label on the windscreen at the point of sale
  • Commonwealth programmes (costing $AU83 million) aimed at increasing the use of alternative fuels, especially CNG and LPG, especially in medium-to-heavy road vehicles
  • a strategic framework for greenhouse and agriculture, being prepared under the auspices of the Commonwealth’s Greenhouse and Agriculture Taskforce, which will identify priority actions, information needs and abatement options for key agricultural industries.

Significant resources are dedicated domestically to developing emissions-reducing technologies. The Cooperative Research Centre for Greenhouse Gas Technologies researches the logistic, technical, financial and environmental issues of storing industrial carbon dioxide emissions in deep geological formations. The Cooperative Research Centre for Clean Power from Lignite aims to develop technologies to reduce greenhouse gas emissions from lignite-fired power stations while enhancing Australia's international competitiveness from low-cost energy.

Canada

Emissions profile and trends

Canada’s greenhouse gas emissions are shown in the graph below. Total emissions in 2002 equated to 725.2Mt CO2e. Total energy emissions (comprising electricity and heat, manufacturing and construction, transportation, other fuel combustion and fugitive emissions) add up to 81.7% of overall emissions.

Figure 3 - Greenhouse Gas Emissions by Sector in Canada 2002

Electricity and heat: 28%. Manufacturing and construction: 9%. Transportation: 26%. Other fuel combustion: 11%. Fugitive emissions: 8%. Industrial processes: 7%. Agriculture: 8%. Waste: 3%.

Source: World Resources Institute (http://cait2.wri.org/wri)

On a per capita basis, Canada ranks ninth in the world for carbon dioxide emissions due to a variety of factors, in particular its energy-intensive economy. Between 1990 and 2002, Canada’s emissions grew by 1.5% per annum. Significant economic and population growth played major roles in this emissions growth.

Based on projections reported in Canada’s third national communication to the UNFCCC in 2002, emissions across all sectors are estimated to reach 705Mt CO2e in 2010 – a 16% increase over 1990 levels. Canada’s commitment under the Kyoto Protocol is to reduce anthropogenic greenhouse gas emissions to 6% below 1990 levels during the 2008 to 2012 commitment period.

Mitigation responses

In April 2005, Canada’s Government released a new national climate change plan, Moving Forward on Climate Change: A Plan for Honouring our Kyoto Commitment.  The plan combines regulatory, negotiated, and incentive-based approaches.  It anticipates mandatory emission intensity caps for major greenhouse gas-producing sectors, but also relies heavily on government-funded purchases of emissions reductions, both domestically and through the Kyoto Protocol’s flexibility mechanisms.  Key elements of the plan are described below:

  • the Large Final Emitters System is a mandatory market-based programme aiming to reduce emissions to 45Mt below business-as-usual in the mining, manufacturing, oil, gas and thermal electricity sectors, which account for roughly half of national emissions.  The cost of compliance is capped at $CA15 per tonne of CO2e (approximately $US13). Specifics, including emissions allocation among sectors and companies, are still to be determined.  Companies investing in technological research and development through a new GHG Technology Investment Fund will be eligible for emission credits (up to 9Mt total), which can be used to meet their targets
  • in a memorandum of understanding with the Auto Sector, auto manufacturers agreed to reduce carbon dioxide, methane, nitrous oxide, and hydrofluorocarbon emissions from light-duty passenger cars and trucks by 5.3Mt or 6% below business-as-usual by 2010 (in line with a previous government pledge to achieve a 25% efficiency improvement)
  • through a new Climate Fund, the Government intends to purchase 75Mt to 115Mt of reduction credits a year, up to 40% of the total reduction needed in CP1.  Priority will be given to domestic reductions from farmers, forestry companies, municipalities, and other sources (including Large Final Emitters that do better than their targets).  Purchases will be made on a competitive basis.  Reductions also will be purchased through the Kyoto mechanisms, with safeguards against the purchase of so-called “hot air”.  The Government agreed to allocate $CA1 billion per year over the next five years and projects funding of $CA4 billion to $CA5 billion during 2008 to 2012
  • a new Partnership Fund will support government-to-government agreements at the federal, provincial and territorial levels to jointly pursue emissions-reduction projects, including short- and long-term climate change technology investments and infrastructure development.  The Government has agreed to allocate $CA500 million per year over the next five years and anticipates that this funding of $CA2 billion to $CA3 billion could result in 55Mt to 85Mt annual reductions in 2008 to 2012
  • a quadrupling of the Wind Power Production Incentive will provide $CA200 million over the next five years to achieve a projected 4,000 MW increase in wind generating capacity.  The Renewable Power Production Incentive will provide $CA97 million over the next five years to increase capacity from small hydroelectric, biomass, tidal, and other renewable sources by a projected 1,000 MW.  Other incentives include increasing the capital cost allowance to 50% for highly efficient cogeneration equipment and other renewable technologies. Incentives, tax measures, and related provincial measures are expected to result in a 15Mt annual reduction in 2008 to 2012.

Japan

Emissions profile and trends

Japan’s greenhouse gas emissions are shown in the graph below. Total emissions in 2002 equated to 1,330.8Mt CO2e. Total energy emissions (comprising electricity and heat, manufacturing and construction, transportation, other fuel combustion and fugitive emissions) add up to 89% of overall emissions.

Figure 4 - Greenhouse Gas Emissions by Sector in Japan 2002

Electricity and heat: 28%. Manufacturing and construction: 26%. Transportation: 20%. Other fuel combustion: 15%. Fugitive emissions: 0%. Industrial processes: 6%. Agriculture: 3%. Waste: 2%.

Source: World Resources Institute <http://cait2.wri.org/wri>

Between 1990 and 2002, Japan’s emissions grew by 1.0% per annum. Based on projections reported in Japan’s third national communication to the UNFCCC in 2002, emissions across all sectors are estimated to decrease to 1,317Mt CO2e in 2010 – a total increase of less than 1% over 1990 levels. Under the Kyoto Protocol, Japan is required to reduce emissions by 6% from 1990 levels during CP1.

Mitigation responses

The Global Warming Prevention Headquarters was established in Japan in 1997. A new strategy Guideline for Measures to Prevent Global Warming was concluded in March 2002. The guideline stipulates more than 100 policies and measures designed to help Japan meet its Kyoto commitment. Measures include:

  • promoting technology development in the industrial sector and distributing results
  • promoting the introduction of high-performance industrial furnaces
  • promoting energy-management systems in large-scale office buildings, through regulatory measures
  • promoting high-efficiency water heating in residential and commercial premises
  • accelerating the development and distribution of low-emission vehicles, including clean-energy vehicles
  • improving traffic flow by introducing Intelligent Transport Systems
  • improving the efficiency of freight services, including the promotion of modal shift to shipping
  • promoting the use of public transportation
  • supporting market introduction of photovoltaic power generation, solar thermal utilisation, wind power generation, waste power generation and biomass energy
  • subsidising the cost of converting old coal-fired power generation to natural gas generation
  • promoting nuclear power generation
  • aiming to halve the volume of waste disposed in landfills
  • promoting research and development in energy-efficient steel production processes and chemical processes, energy-efficient electric appliances, and a high efficiency electricity distribution system
  • promoting a range of energy-efficient measures, including changing incandescent lighting to fluorescent lighting, efficient refrigerator use, and other general behaviour change.

European Union

Emissions profile and trends

The European Union consists of 25 individual countries (the EU-25). Under the Kyoto Protocol, the European Union has elected to receive an overarching emissions target for CP1 and distribute emissions allowances under this target among member countries. The European Union’s greenhouse gas emissions are shown in the graph below. Total emissions in 2002 equated to 4,123.3Mt CO2e. Total energy emissions (comprising electricity and heat, manufacturing and construction, transportation, other fuel combustion and fugitive emissions) add up to 81.2% of overall emissions.

Figure 5 - Greenhouse Gas Emissions by Sector in the European Union 2002

Electricity and heat: 29%. Manufacturing and construction: 14%. Transportation: 21%. Other fuel combustion: 16%. Fugitive emissions: 2%. Industrial processes: 6%. Agriculture: 10%. Waste: 2%. Other sources: 0%.

Source: World Resources Institute (http://cait2.wri.org/wri)

Between 1990 and 2002, the European Union’s emissions decreased by 0.2% per annum. Large increases of CO2 emissions from transport were outweighed by reductions from fossil-fuel combustion in energy and manufacturing industries. CH4 emissions account for 9% of total European Union greenhouse gas emissions and decreased by 17% between 1990 and 1999. The main reasons for declining CH4 emissions were reductions in solid waste disposal on land, the decline of coal mining and falling cattle numbers.

Based on projections reported in the European Union’s third national communication to the UNFCCC in 2002, emissions across all sectors are estimated to reach 4,190Mt CO2e in 2010 – almost no change from 1990 levels. The European Union’s aggregate target under the Kyoto Protocol is to achieve average annual emissions 8% below 1990 levels for 2008 to 2012.

Mitigation responses

Key points agreed by the European Union Council on future action include:

  • a commitment to limiting temperature increases to 2ºC
  • supporting continued use of market mechanisms (eg, the European Union Emissions Trading Scheme) in a future regime
  • identifying the reduction of greenhouse gases from bunker fuels as urgent
  • recognising the UNFCCC as the vehicle for moving forward on a future framework.

Since the launch of the European Climate Change Programme, a considerable number of European Union measures have been adopted. Most importantly, the European Union has implemented an emissions-trading scheme covering approximately 50% of CO2 emissions in the EU-25, notably of the energy-intensive sectors, so as to achieve emissions reductions in the most cost-effective and flexible way. In addition, the “linking directive” establishes the provisions and rules for enabling economic operators to use credits from JI and CDMs for compliance within the emissions-trading scheme.

Further actions on climate change include:

  • undertaking an inventory and review of energy subsidies in the member states, with consideration to compatibility with climate change objectives
  • supporting renewable energy sources through the new directive and by ensuring adequate support in the liberalised energy market
  • using market instruments; eg, through the adoption of proposals for energy taxation
  • promoting energy saving on heating and cooling in buildings
  • environmental agreement with industry on energy efficiency and reducing specific emissions
  • proposing a comprehensive approach to aviation emissions, including research into cleaner air transport, better air-traffic management, the removal of legal barriers to taxing aircraft fuel, and including aviation in the European Union Emissions Trading Scheme
  • highlighting climate change as a major theme of European Union policy for research and technological development and in the coordination of research in the member states.

Norway 

Emissions profile and trends

Norway’s greenhouse gas emissions are shown in the graph below. Total emissions in 2002 equated to 55.3Mt CO2e. Total energy emissions (comprising electricity and heat, manufacturing and construction, transportation, other fuel combustion and fugitive emissions) add up to 66% of overall emissions.

Figure 6 - Greenhouse Gas Emissions by Sector in Norway 2002

Electricity and heat: 20%. Manufacturing and construction: 7%. Transportation: 25%. Other fuel combustion: 8%. Fugitive emissions: 6%. Industrial processes: 18%. Agriculture: 9%. Waste: 7%. Other sources: 0%.

Source: World Resources Institute (http://cait2.wri.org/wri)

In 2002, petroleum and other fossil fuels accounted for 37% of Norway’s domestic energy use (including transport), hydropower accounted for 56% and other renewable energy sources accounted for about 7%.

Between 1990 and 2002, Norway’s emissions increased by 0.5% per annum. The increase is mainly explained by general economic growth, which has resulted in higher CO2 emissions from most sectors. Since electricity is generated almost exclusively from hydropower, emissions from stationary combustion are dominated by industrial sources.

Based on projections reported in Norway’s third national communication to the UNFCCC in 2002, emissions across all sectors are estimated to reach 63.2Mt CO2e in 2010 – an increase of 22% over 1990 levels. Norway’s target under the Kyoto Protocol is to achieve average annual emissions 1% above 1990 levels for 2008 to 2012. The increase in greenhouse gas emissions from 1990 to 2010 is mostly driven by an increase in CO2 emissions, which alone are expected to rise by 36%. Consumption of petroleum products is expected to grow at about 0.5% per year from 1999 to 2010. Consumption of electricity is assumed to grow at about 1% per year during this period. The rate of energy efficiency improvement varies between sectors but is assumed to average about 1% per year.  

Mitigation responses

The first Norwegian measure that directly addressed greenhouse gas emissions, a tax on CO2, was introduced in 1991. This tax is still in force and covers about 65% of CO2 emissions at various rates up to NOK315 per tonne ($US35). High rates apply to petrol and activities on the continental shelf, and lower rates on the use of mineral oils. Exemptions apply mainly to emissions from energy- and emissions-intensive industries that are exposed to international competition. A tax on final waste treatment was introduced in 1999. One reason for this was climate change concerns. The tax discourages landfilling and encourages energy recovery from waste.

Discharge permits pursuant to the Pollution Control Act are required for major industrial developments. Permits have been granted for three combined-cycle gas-fired power plants, but the developers have still not decided whether to make the investments. The Government has stated that it wishes to create a framework that would promote a “CO2-free” solution for these plants, and incentives are provided through exemption from the electricity tax. No further permits will be granted for the development of fossil-fuelled power plants before CP1 under the Kyoto Protocol.

An electricity tax offers incentives for most users to use less electricity and thus discourages the installation of new capacity based on fossil fuels. Wind power is subject to the electricity tax at half the normal rate and, like other new renewables, it is exempted from the investment tax. There are also grant schemes for new renewables and for energy-efficiency measures. In the 2002 supplementary white paper on climate policy, the Government introduced a target of a 25% reduction of the use of mineral oils for heating in 2008 to 2012 compared with 1996 to 2000.

In the transport sector, fiscal and CO2 taxes on fuels provide the strongest incentive to limit emissions. The purchase tax also provides an incentive to buy lighter, more energy-efficient vehicles. There are extensive subsidies for public transport. From July 2002, car producers have been obliged to include information on fuel efficiency and CO2 emissions in their marketing. The Government plans to expand this to other types of vehicles. Funds have been allocated to encourage research, development and testing into alternative fuels, electric and hybrid vehicles.

Most greenhouse gas emissions from energy- and emissions-intensive industries are not subject to the CO2 tax. However, measures have been taken that have significantly reduced emissions from aluminium, magnesium and fertiliser production. The Government has proposed that emissions from these industries that are currently not subject to the CO2 tax should be included in a mandatory domestic emissions-trading scheme from 2005.

One of Norway’s objectives is to increase the use of new renewable energy sources, and the Government will develop a strategy for the use of renewable energy sources instead of petroleum for heating.

Russia

Emissions profile and trends

Russia’s greenhouse gas emissions are shown in the graph below. Total emissions in 1999 equated to 1873.5Mt CO2e. More recent data on Russian emissions is not yet available. Total energy emissions (comprising electricity and heat, manufacturing and construction, transportation, other fuel combustion and fugitive emissions) add up to 90% of overall emissions.

Figure 7 - Greenhouse Gas Emissions by Sector in Russia 1999

Fossil fuel combusion: 79%. Fugitive emissions: 11%. Industrial processes: 4%. Agriculture: 4%. Waste: 2%.

Source: Third national communication of the Russian Federation

Between 1990 and 1999, Russia’s emissions decreased by over 1,100Mt CO2e, largely due to the closure of emissions-intensive heavy industries over this period. Emissions trends between 1990 and 1999 are illustrated below. While CO2 emissions have fallen, the carbon intensity of the Russian economy remains high

[withheld under OIA s6(a)]

Figure 8 - Absolute Change in Russian Greenhouse Gas Emissions 1990-1999

The trends in this graph are summarised above.

Source: Third national communication of the Russian Federation

Based on Russia’s third national communication to the UNFCCC, Russia’s CO2 emissions are projected to equal between 75% and 89% of 1990 levels at 2010. Projections of other fossil fuels have not been undertaken. Russia’s target under the Kyoto Protocol is to achieve average annual emissions equivalent to 1990 levels for 2008 to 2012.

Mitigation responses  

Russia’s programme for mitigating greenhouse gas emissions is at a formative stage. Due to the dominance of CO2 emissions from fossil fuels in Russia’s emissions profile, it has stated a focus of its strategies will be on reducing CO2 from electricity generation. In 2000, the Basic Provisions of the Energy Strategy for Russia for the Period to 2020 was approved by the Government. The key aim for the strategy is to seek the most efficient utilisation of natural resources and energy for improving the quality of life of the population. More generally, substantial increases in the energy efficiency of the economy is considered among the core tasks in achieving social and economic recovery for Russia. Russia is also seeking opportunities to mitigate emissions in the agriculture and forestry sectors, including improving soil fertility in Russia, and improving systems for the collection, storage and use of animal manure.