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Wed 28 Mar 2012 06:09 PM

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The Arab world has a chance to change climate change perceptions

Qatar will undoubtedly be looking to make an impact on climate negotiations

The Arab world has a chance to change climate change perceptions
Qatar will undoubtedly be looking to make an impact on climate negotiations.

The attention of much of the Arab world has recently been focused on the
landmark Arab League summit, held between 27 and 29 March, the first to be held
in Iraq since 1990.  Going forwards,
however, preparations are already underway for an even bigger, global
conference later this year that will focus the eyes of the globe once again
upon the Arab world, specifically Qatar. 

When
it was announced that Qatar,
rather than South Korea,
would host this year’s UN climate change conference in December, many were
exasperated. Would it really be a good
idea for climate change negotiations to be in the hands of a state whose
economy is so dependent on selling fossil fuels and that has the highest
greenhouse gas emissions per capita in the world? 

My
answer to this question is a resounding yes. The 18 Conference of the Parties to the UN Framework
Convention on Climate Change (or COP18 in the jargon) is the first step in a
4-year negotiation process towards a new, legally binding international deal to
take effect by 2020. The fact that these
negotiations will take place in Qatar presents an opportunity to engage with a
constituency - the oil-rich Gulf States - that is fundamental to the success of
any long-term strategy to tackle climate change and yet, until now, has been at
best largely ignored or, at worst, demonised.

Qatar,
state of just 1.4m inhabitants and with one of the world’s highest GDP
per capita due to vast reserves of oil and gas, has been making a concerted
effort to impress on the world stage.  It
has played prominent mediation roles in Western
Sahara, Yemen,
Ethiopia and Eritrea, Somalia
and Sudan.  In 2001 it initiated the “Doha round” of
talks under the WTO to try to break the deadlock in these complex
negotiations.  And, more recently, it was
announced that this state would host the 2022 FIFA World Cup. 

Qatar
will undoubtedly be looking to make an impact on the climate negotiations.

So,
how could the Qatari government make a difference on climate change? By making a game-changing investment in the development
of carbon capture and storage (CCS), the technology to capture CO
emissions from the burning of fossil fuels and storing them underground. It has the motive and the money. And the Qataris would receive huge
international kudos. China, a country with the highest greenhouse gas
emissions (and increasing rapidly), is the perfect partner.

Fossil
fuels are likely to remain a major part of the global energy mix for
decades. Without a way of reducing the
impact of burning fossil fuels on our climate there is no credible scenario
under which the international community can reduce emissions of greenhouse
gases sufficiently to limit global average temperature rise to 2 degrees
Celsius, the agreed goal under the UN negotiations.  And yet, so far, progress to demonstrate and
deploy CCS technology at scale has been painfully inadequate.

CCS
technology is not yet mature and is expensive. In the long-term CCS will be viable if it is cheaper to capture and
store the CO2 emissions than to release them into the atmosphere. This means there must be a sufficient cost
imposed on installations that emit carbon. Estimates suggest that, once CCS technology is mature, a carbon price
-the cost of emitting carbon into the atmosphere - of between US$44 and US$103
will be sufficient to make CCS viable. Although the current price of carbon in the EU (the world’s major carbon
market) is around €9 (US$2), a tightening of the cap on emissions from
2013 means that a sufficient carbon price in the EU is a distinct
possibility. 

If
one takes into account recent laws and proposals to set up carbon markets in Australia, China,
Mexico, South Korea and California
in the US, it is not too
much of a leap to imagine a price of carbon high enough to make CCS viable
across a range of countries. The problem
is not that CCS isn’t viable in the long-term; the problem is that, in the
short- to medium-term, it is going to require big capital investments to build
the commercial scale demonstration projects that will help to bring down the
costs to a long-term equilibrium. Until
now, with a lack of regulatory certainty about the future price of carbon and
the fiscal challenges to governments and businesses in the economic downturn,
investments have not been forthcoming on the scale required.

This
year could see the planets align.

First,
on the fossil fuel supply side, Qatar
and the other Gulf States
have a motive. CCS is a great technology
for countries that sell fossil fuels.  It
allows the burning of these fuels in a way that does not damage the climate,
thus potentially prolonging the life of the markets for fossil fuels, even in a
highly carbon constrained post-2020 world.

Second,
on the demand side, China’s
production of a fossil-fuelled power station a week offers the opportunity to
bring down costs fast. And with coal and
oil-dependent China likely
to take on some form of emissions reduction target under a post-2020 climate
change deal, it is now in China’s
strategic interest to commercialise this technology quickly.

Finally,
the regulatory outlook is more certain. Before the most recent round of UN negotiations in South Africa in December, many commentators
thought that the legally binding nature of the UN process would dissipate when
the Kyoto Protocol’s first commitment period expired in 2012. Durban
changed that.  The Kyoto Protocol was
extended and there was agreement from all countries to begin negotiations on a
legally binding agreement for the post-2020 period and to complete those
negotiations by 2015. So it is now more
likely that there will be stricter carbon constraints on all major countries
after 2020, reducing the regulatory risk of investment in CCS.

Qatar and fellow supply
countries, either through their massive Sovereign Wealth Funds or other means,
should take the opportunity to commercialise a technology that is essential
under any scenario that limits global average temperature rise to 2 degrees
Celsius. China, with its increasing
reliance on Middle Eastern oil, is keen to strengthen its relationships with
key supply countries, as evidenced by Premier Wen’s visit to Saudi Arabia, UAE
and Qatar in January, and will be thinking strategically about how it will power
its economy whilst taking on post-2020 carbon constraints. The added bonus for both countries is that,
once commercialized, CCS technology will be exportable around the world,
creating jobs and wealth in a new low carbon industry.

The
opportunity is clear. Qatar, as hosts of COP18, will be looking for
something symbolic.This could just be
it.

Rt
Hon John Gummer, Lord Deben, is President of Global Legislators
Organisation (GLOBE) and former UK Secretary of State for the Environment

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