Europe had been waiting patiently for the United States to enact domestic legislation to cut its carbon emissions. After months of negotiations between the U.S. Congress and utilities, oil companies, and other stakeholders on the details of comprehensive climate and energy legislation, the Senate in late July abandoned hopes of passing such a bill before it entered its August recess. A lack of Republican support meant that even a scaled-down cap-and-trade proposal — covering only utilities — was unlikely to pass. Partisan rancor in the lead-up to mid-term elections and concerns over carbon pricing mean that legislation will be off the table for this year, at the very least. While a small chance remains that Congress will consider a carbon tax next year as part of a deficit reduction strategy, the window for a comprehensive bill could possibly be shut until 2013.
Having watched these efforts unravel, observers in Europe and the rest of the world have begun to wonder whether the United States will make good on its commitment to cut its emissions over the next decade. European leaders worry that without a comprehensive climate and energy program in place, the United States will not meet its emission targets. Fortunately, it still can, at least in the near term.
At the international climate negotiations in Bonn this week, the United States took pains to give other countries confidence that it was not backing away from President Obama’s promise to reduce its emissions by 17 percent below 2005 levels by 2020. A new World Resources Institute study finds that if the federal government fully flexes its regulatory authority and states take aggressive climate action through 2016, the United States could come close to meeting the U.S. emission reduction goal in the near term. The United States also appears to be on track to deliver its share of the $30 billion in climate financing that developed countries promised by 2013 to help impoverished nations cope with the worst consequences of climate change.
But there are bigger worries to keep European and other climate delegates up at night. Although the United States can use tools other than legislation to reduce its emissions over the next several years, the chances are slim that it will deliver the promised emissions cuts over the long term without a cap on carbon emissions. Even more problematic is the absence of a clear plan to meet its commitment to help raise $100 billion per year in climate aid by 2020. When Secretary of State Hillary Clinton made this commitment in Copenhagen, she was counting on U.S. cap-and-trade revenue and new private investment mobilized through a global carbon market. To date, the Obama administration has met its climate financing commitments through budgetary requests to Congress—the President requested $1.4 billion in climate aid for 2011, a 38 percent increase over 2010 levels. As pressure to trim the U.S. budget deficit grows, this approach will not be sustainable over the long-term. The United Nations High-Level Advisory Group on Climate Change Financing is exploring ways to meet the $100 billion goal. Options include ear-marking fossil fuel royalties for climate action and taxing international shipping and aviation to generate new revenue for climate aid.
In advance of the next UN climate summit in Cancun this December, Europe and the rest of the world should resist the temptation to focus primarily on encouraging the United States to meet its emission reduction goals. Instead, they should push it to deliver the promised climate financing. Unless all developed countries, including the United States, do their part to meet the stated goal, the developing world will remain ill-equipped to cope with drought, flooding, and other climate catastrophes. FurthermoreEurope and the United States will have no leverage to secure climate commitments from China and other major emitters in the developing world.
