Most of you will know that the Kyoto Treaty adopted CO2 reduction goals referenced to a base year of 1990. But what you might not know is exactly how that year was selected. Why would a treaty, negotiated and signed in the latter half of the 90’s adopt 1990 as a base year, rather than say 1995 or 2000? Or even 1980.
Closely linked to this question of base year selection for the treaty is a sort of cognitive dissonance that is occurring in reports about compliance of the signatories with the treaty. Some seem to report substantial progress by European countries in reducing emissions, while others report that nearly everyone is going to miss the goals by a lot and that lately, the US has been doing better than signatory countries in terms of CO2 emissions.
To answer this, lets put ourselves back in about 1997 as the Kyoto Treat was being hammered out. Here is what the negotiators knew at that time:
- Both Japan and Europe had been mired in a recession since about 1990, cutting economic growth and reducing emissions growth. The US economy had been booming. From 1990-1995, US average real GDP growth was 2.5%, while Japan and Europe were both around 1.4% per year (source xls).
- The Berlin Wall fell in 1989, and Germany began unifying with East Germany in 1990. In 1990, All that old, polluting, inefficient Soviet/Communist era industry was still running, pumping out incredible amounts of CO2 per unit produced. By 1995, much of that industry had been shut down, though even to this day Germany continues to reap year over year efficiency improvements as they restructure old Soviet-era industry, transportation infrastructure, etc.
- The UK in the late 1980’s had embarked on a huge campaign to replace Midlands coal with natural gas from the North Sea. From 1990-1995, for reasons having nothing to do with CO2, British substituted a lot of lower CO2 gas combustion in place of higher CO2 coal production.
Remember, negotiators knew all this stuff in 1997. All the above experience netted to this CO2 data that was in the negotiators pocket at Kyoto (from here):
CO2 Emissions Changes, 1990-1995
EU -2.2% Former Communist -26.1% Germany -10.7% UK -6.9% Japan 7.2% US 6.4%
In the above, the categories are not mutually exclusive. Germany and UK are also in the EU numbers, and Germany is included in the former communist number as well. Note that all numbers exclude offsets and credits.
As you can see, led by the collapse of the former communist economies and the shuttering of inefficient Soviet industries, in addition to the substitution of British gas for coal, the European negotiators knew they had tremendous CO2 reductions already in their pocket, IF 1990 was chosen as a base year. They could begin Kyoto already looking like heroes, despite the fact that the reductions from 1990-1997 were almost all due to economic and political happenings unrelated to CO2 abatement programs.
Even signatory Japan was ticked off about the 1990 date, arguing that it benefitted the European countries but was pegged years after Japan had made most of their improvements in energy efficiency:
Jun Arima, lead negotiator for Japan’s energy ministry, said the 1990 baseline for CO2 cuts agreed at Kyoto was arranged for the convenience of the UK and Germany. …
Mr Arima said: "The base year of 1990 was very advantageous to European countries. In the UK, you had already experienced the ‘dash for gas’ from coal – then in Germany they merged Eastern Germany where tremendous restructuring occurred.
"The bulk of CO2 reductions in the EU is attributable to reductions in UK and Germany."
His other complaint was that the 1990 baseline ruled inadmissible the huge gains in energy efficiency Japan had made in the 1980s in response the 1970s oil shocks.
"Japan achieved very high level of energy efficiency in the 1980s so that means the additional reduction from 1990 will mean tremendous extra cost for Japan compared with other countries that can easily achieve more energy efficiency."
So 1990 was chosen by the European negotiators as the best possible date for their countries to look good and, as an added bonus, as a very good date to try to make the US look bad. That is why, whenever you see a press release from the EU about carbon dioxide abatement, you will see them trumpet their results since 1990. Any other baseline year would make them look worse.
One might arguably say that anything that occured before the signing of the treaty in 1997 is accidental or unrelated, and that it is more interesting to see what has happened once governments had explicit programs in place to reduce CO2. This is what you will see:
Just let me remind you of some salutary statistics. Between 1997 and 2004, carbon dioxide emissions rose as follows:
Emissions worldwide increased 18.0%;
Emissions from countries that ratified the protocol increased 21.1%;
Emissions from non-ratifiers of the protocol increased 10.0%;
Emissions from the US (a non-ratifier) increased 6.6%;
Postscript: One would expect that absent changes in government regulations, the US has probably continued to do better than Europe on this metric the last several years. The reason is that increases in wholesale gas prices increase US gas retail prices by a higher percentage than it does European retail prices. This is because fixed-amount taxes make up a much higher portion of European gas prices than American. While it does not necesarily follow from this, it is not illogical to assume that recent increases in oil and gas prices have had a greater effect on US than European demand, particularly since, with historically lower energy prices, the US has not made many of the lower-hanging efficiency investments that have already been made in Europe.