Mermaid’s anger grows

While some corporate climate lobby groups have in public lamented the failure of the UN climate talks in Copenhagen to reach a strong agreement, behind closed doors, many of them are relieved. Indeed, if there was any attempt to agree meaningful action on climate change in Copenhagen, a number of big business players had been working hard to prevent it. This article looks at the corporate lobbyists who were nominated for the Angry Mermaid Award ahead of Copenhagen – and asks what they achieved.

The UN climate talks in Copenhagen were a key target for corporate lobbyists, keen to see their policies and interests reflected in the negotiations and the outcome. The Angry Mermaid Award put these corporate climate lobbyists in the spotlight during the talks – but did their lobbying efforts deliver?

The Copenhagen talks failed to produce a meaningful agreement. The “Copenhagen Accord” - produced by a small group of countries at the talks was not formally adopted, only “noted”, and remains a voluntary agreement between some countries, setting non-legally binding targets for emissions cuts, via market mechanisms.

Many observers, including citizens groups and climate experts described the result as deeply disappointing. Others think “disastrous” would be more accurate – unless of course the clear failure in fact provokes greater public pressure for international action.

Where do the eight distinguished members of the corporate climate lobby that were nominated for the Angry Mermaid Award fit into this? Most corporations have developed a refined strategy and rhetoric on climate change that allows them to present themselves as part of the solution – and most of the Angry Mermaid nominees are no exception. But before and during Copenhagen, they worked to make sure tough action was not agreed.

This article divides them into four groups – the “climate profiteers” who see opportunities in tackling climate change, those who are pushing for solutions which will allow them to continue with business as usual, those who still have their heads stuck in the sand and those openly resisting to measures on climate change.


The Climate Profiteers

Corporate policies on climate change differ depending on each corporation’s vested interests. One group are the climate profiteers, corporations that seek to turn regulation to fight climate change to economic advantage regardless of its effectiveness.

Monsanto
Monsanto and the Round Table on Responsible Soy (RTRS) – winners of the Angry Mermaid Award for lobbying for genetically modified crops to be seen as “climate-friendly” – belong to this category. They claim that Roundup Ready soy should be eligible for carbon credits and subsidies under the Clean Development Mechanism (CDM) – the process under the Kyoto Protocol which allows developed countries to offset emissions by buying carbon credits from the developing world – and have pushed for a broad “responsible” label for Roundup Ready soy, which could be used to certify ‘“sustainable’ agrofuels.”

Both Monsanto and the RTRS were present in Copenhagen and Monsanto responded to winning the Award online:

“... to be recognized for our participation in RTRS is an honor... Some prominent members of the group include Conservation International, the Nature Conservancy, WWF, in addition to a long list of private-sector companies such as Carrefour, Marks and Spencer, Rabobank, BANCO Real, Unilever, etc. Sounds like a good match for Copenhagen. We thank the Angry Mermaid award organizers for drawing attention to the important work that the Roundtable is addressing.”

The lobbying by the biotech companies cannot be described as a huge success. The future of agriculture, soil carbon sequestration and ‘no-till’ techniques (growing crops from year to year without ploughing) under any future climate agreement still remains unclear. In Copenhagen, text on soil carbon sequestration disappeared from three parts of the negotiating text. However, it was added to a draft paper on Land Use, Land Use Change and Forestry (LULUCF), which means the talks will further investigate the potential for soil carbon sequestration under the Clean Development Mechanism, which could eventually lead to CDM funding for Roundup Ready soy.

Nevertheless, outside of the negotiations, there was new support for soil carbon sequestration, from a group of countries including the USA, Australia and Canada. The Global Research Alliance on Agricultural Greenhouse Gases was launched in Copenhagen, with US Agriculture Secretary Tom Vilsack at the event. This worldwide scientific collaboration is intended to find “cost-effective and accurate ways of measuring greenhouse gas emissions and carbon stored in soil, and new farming practices that reduce emissions and increase carbon storage in farmland in different countries”.

International Emissions Trading Association (IETA)

Another climate profiteer and nominee for the Angry Mermaid Award was the International Emissions Trading Association (IETA), the main lobby group for emissions trading. With 486 accredited representatives in Copenhagen, IETA was by far the biggest business lobby at the Copenhagen talks, keen to promote greater use of carbon trading as a solution to climate change, including offsetting through the Clean Development Mechanism (CDM).

With this in mind, it’s no surprise that IETA didn't consider the Copenhagen meeting as a success. IETA would have preferred an agreement that gave a boost to the carbon trading market.

Under the Kyoto Protocol, countries can use “market mechanisms” such as carbon trading and the CDM to reduce emissions. In theory, by trading the right to pollute, developed countries find the most economic ways of cutting carbon. Under the CDM developed countries can offset emissions by investing in supposed “clean” projects in the developing world. But these market mechanisms have failed to deliver cuts in carbon – with global emissions rising by 1% in 2007. 

But both are climate profiteers and an international agreement would have provided opportunities to boost their profits. Copenhagen didn’t provide this – but both can be expected to carry on pushing for ways to profit – rather than genuine cuts – at future talks.


Pushing for business as usual

A large number of corporations in energy intensive sectors – many of which are reformed climate sceptics – are no longer opposing action to combat climate change, but are pushing for technologies and rules that will allow them to continue with “business as usual” under any future climate regime. And while in public they appear disappointed at the lack of progress in Copenhagen, the failure to agree binding targets means that they can indeed continue with fossil-fuelled business as usual for a little while more.

Shell

The runner-up for the Angry Mermaid Award, the oil giant Shell, was vociferous in the run up to Copenhagen on the need for the UN climate talks to agree to provide support for carbon capture and storage (CCS) – as yet unproven technology which could allow carbon to be captured and stored. Shell suggests there is particular potential for using this technology in the developing world.

Shell was present in seven different observer groups in Copenhagen including as part of the World Business Council for Sustainable Development (WBCSD) delegation, the International Chamber of Commerce (ICC), and as a member of the official Indonesian government delegation.

Shell also pushed for an end to the Kyoto Protocol, which their chief climate advisor described as “unsustainable”. While the Protocol has many shortcomings, it does contain some important principles including binding targets and a recognition of the differing responsibilities between developed and developing countries for tackling the problem. Shell is keen to get rid of this distinction, suggesting that binding reduction commitments for “the small number of countries with specific targets” would limit the impact of any new agreement. At the same time, the company wants to keep the “key elements that lay the foundation for a market-based approach”.
 

One of Shell’s main objectives was to get an explicit recognition of carbon capture and storage (CCS) as an important technology for reducing the threat of climate change. One way for this to happen would be for CCS to be eligible under the Clean Development Mechanism (CDM), allowing developed countries to offset their emissions by investing in the development of CCS in the developing world.

Although the inclusion of CCS was discussed, Shell did not get the result it desired. A draft decision on the CDM recognised the “importance of carbon dioxide capture and storage in geological formations as a possible mitigation technology” but requested further work and further submission on a number of concerns, including environmental impacts, liability, safety and non-permanence.

For Shell, this decision leaves a lot to be desired – but the door is still open and it is likely that Shell will be lobbying hard to get support from national governments for the inclusion of CCS in the Clean Development Mechanism at the talks in Mexico.

Shell has expressed satisfaction with the inclusion of non-binding targets in the Copenhagen Accord, but was less enthusiastic that the current state of affairs “allows” the Kyoto Protocol to persist and lists its definitive end as a priority for the near future. 

Sasol

Another Angry Mermaid nominee, Sasol, a South African company, is pushing to expand its synthetic fuel business, making oil from coal. Sasol banks on unproven carbon capture and storage (CCS) technology as a way to reduce the high level of CO2 emissions generated during the production of synthetic fuel from coal. Sasol has already managed to get funds from the Clean Development Mechanism (CDM) for its nitrous oxide emissions abatement projects.

Now Sasol is looking to cash in even more CDM credits through CCS and the company sent representatives to Copenhagen as part of the International Chamber of Commerce (ICC) delegation. But there is still some way to go. The inability of the Parties to find a general compromise prevented any progress on CCS projects funding.

Sasol played an important role in the development of the South African government’s Long Term Mitigation Scenario, putting forward the government’s proposals for reducing greenhouse gas emissions. At the same time, Sasol is planning to build new highly polluting coal-to-liquids plants. Sasol has conceded that regulation could have a “material adverse effect” on its business and “financial condition”. Bearing that in mind, it would also seem self-evident that the failure of Copenhagen to produce anything tangible is good news for Sasol. 

There are many corporate giants that play this game of proactively putting forward proposals on climate change to defend their interests. While recognising that they cannot prevent an agreement, they bet everything on influencing the implementation of that agreement. Whether or not Shell or Sasol hoped to obtain their goals on CCS, they are unlikely to be dissatisfied with the final outcome.

Sectoral Myopia

Many if not most corporations look to their sectoral associations to defend their interests which normally deliver. In this group we find the most notorious contestants of a strong and ambitious climate policy.

International Air Transport Association (IATA)

After COP15, the International Air Transport Association (IATA), another nominee for the Angry Mermaid Award, with members including American Airlines, British Airways, Lufthansa and Qantas boasted about their lobbying success, trying to spin what happened in Copenhagen in their own interest.

IATA has consistently lobbied against the inclusion of aviation in a UN agreement and in September 2009, made a pre-emptive strike ahead of the talks, announcing that the aviation industry would cut carbon emissions to 50% of 2005 levels by 2050. Following the failure to agree action on aviation emissions in Copenhagen, IATA claimed: “Aviation emissions were not addressed specifically in the Accord, a reflection of the pro-active measures that industry has taken to set challenging targets for itself.” 

But the lack of targets to reduce emissions from the sector, which has effectively let the aviation industry off the hook for now, can be better attributed to the lack of overall progress and the opposition of certain countries, particularly the US, Canada and Japan, which blocked the 10% target proposed by the EU for the aviation sector.

IATA added: “We also found consensus among the delegations that a global sectoral approach should be established for aviation emissions by ICAO, the UN's specialised agency for aviation.” But according to the EU campaign group Transport and Environment (T&E), this consensus does not exist. Cutting aviation emissions remains on the agenda of the UN climate talks. But IATA is trying hard to establish the ICAO, the UN civil aviation agency – which is dominated by industry, as the forum to discuss potential emission cuts.
 

The ICAO was mandated under the Kyoto Protocol to set reduction targets for aviation, but it has failed to do anything for the last 12 years. According to T&E, this is because of  “the inordinate if not extraordinary influence of industry groups on the process, the Secretariat and the political decision making”. ICAO will now discuss the issue in its meeting in 2010.

The European Chemical Association (CEFIC)

CEFIC, the European chemical industry lobby group, representing companies such as Arkema, BASF, Bayer, Dow, DuPont, ExxonMobil Chemical, Shell Chemicals and Solvay, was another nominee for the Angry Mermaid Awards. Before Copenhagen, CEFIC had been lobbying the EU to reduce – or at least not increase – their emission reduction commitments at the climate talks in Copenhagen and to get developing countries to take on reduction commitments.

The EU stuck to the 20% target in Copenhagen, but following calls to increase its commitment to 30% by the end of January, CEFIC swung into action to prevent such a move. The chemical lobby sent a letter to the EU Commission President Jose Manuel Barroso ahead of the Seville Environment Council meeting in January 2010 asking him to keep the 20% target. In this letter, as in its messages to influential EU media, CEFIC insists that the competitiveness of the European chemical industry will be damaged by a higher target. They seem to have convinced the Spanish Presidency, which has retained the EU’s pre-Copenhagen reservations about only increasing the target to 30% when other developed countries make similar commitments. CEFIC is also lobbying for more concessions in the next phase of the EU emissions trading scheme.
 

Open war against any regulation

While open corporate resistance to measures on climate change is becoming rarer in the European Union, it seems to have a very long life in the US. In the group that conducts an open struggle on almost any political measure against climate change, we will find quite a few companies whose main priority was not the summit in Copenhagen but the US climate debate. Which of course influenced the US’s low ambition in Copenhagen.

American Petroleum Institute (API)

The American Petroleum Institute – which represents hundreds of oil and gas companies in the US – took third place in the Angry Mermaid Award. With members including Shell and BP, they too had been lobbying for financial support for carbon capture and storage (CCS). Like Shell, they would have been disappointed by the failure to get a result on CCS – and they are likely to keep on the pressure in the US for support for this technology. But first and foremost, the API has been concerned with the struggle back home where it is fighting vigorously to block a bill to tackle climate change. Their focus is underlined by the fact that they did not comment on the outcome of the summit, but only on US President Obama’s speech. 

American Coalition for Clean Coal Electricity (ACCCE)

The same goes for another Award nominee, the American Coalition for Clean Coal Electricity (ACCCE), which has been lobbying in the US for a delay to climate legislation until CCS technology is available. Some member companies have left ACCCE as a result of their anti-climate stance.  Others, such as E.ON, continue to be members even though this conflicts with the position they take in Europe.

Though neither API nor ACCCE were overtly present in Copenhagen, and did not lobby on the international level, many of their corporate members were actively involved – and the associations both contributed to Copenhagen quagmire through their US influence. The lack of credible commitment on the part of the US is a key to the failure of the summit and will be a stumbling block for international climate policy for years to come.


Conclusion: corporate crocodile tears

After Copenhagen everything seems to be up in the air. A strong and ambitious climate agreement seems very far away. Some, like the EU, have not lived up to their declarations and have limited the national or regional ambitions under the slogan of international competitiveness, echoing the slogan of European corporations.

Though efforts for an international climate agreement have not been abandoned, Copenhagen marked a significant step backwards. The Copenhagen Accord, pushed by some of the most powerful countries at the table attempts to get rid of binding targets and the principle of common but differentiated responsibilities. At the same time the loopholes that are partly responsible for the ineffectiveness of the Kyoto Protocol, namely market-based mechanisms, are being widened even further.

To the extent that the corporate climate lobby has lamented the Copenhagen Summit outcome, it is for the opportunities for profit that have been lost – and not for the collective failure to agree tough action on climate change.

In Copenhagen, the corporate climate lobby played an important part in the demise of the international climate negotiations. The Angry Mermaid was in Copenhagen to expose their actions. What she saw was enough to make her very angry indeed.