Analysis & Opinions - China Dialogue

Chinese and US Climate Interests are Converging

| May 6, 2014

Bilateral climate change negotiations between China and the US are the most significant development since the Kyoto Protocol

In international climate-change negotiations,  the world's two biggest emitters — China and the United States — have sometimes engaged in vehement debates regarding the fundamental question of who should do what. Most recently, these two giants, and their respective allies in the developed and developing worlds, have clashed  over their very different interpretations of a key phrase in the  agreement reached under the United Nations–led talks in South Africa in 2011.

The point of contention is the call under the Durban Platform for Enhanced Action for a global climate deal to be reached in Paris in 2015 that is "applicable to all Parties … under the Convention". The US and other industrialised countries have insisted that this calls for an agreement containing emissions reduction pledges by all countries. In particular, they understand it to include industrialised countries plus the large emerging economies of China, India, Brazil, Korea, Mexico and South Africa.

But China, India, and most countries in the developing world, point out  that the Durban Platform was adopted under the auspices of the United  Nations Framework Convention on Climate Change (UNFCCC), with its key  principle of "common but differentiated responsibilities and respective  capabilities" — the idea that rich countries should bear a greater share  of the burden of tackling climate change — as well as the subsequent mandate calling for emissions reductions only by developed (so-called Annex 1) countries. Therefore, they say, the Durban Platform calls only for emission reduction commitments from the industrialised nations.

In the midst of these ongoing international debates, there is a very encouraging reality, however — namely the heightened degree of bilateral discussions on climate change policy between China and the United States. In fact, bilateral negotiations between China and the United States — possibly outside of the UNFCCC — are where real progress is most likely to be made. For global efforts to tackle climate change, they are the most significant development since the Kyoto Protocol.

This is happening because of an emerging convergence of interests between the world's two most important countries as far as climate change — and international policy to address it — are concerned. Five factors stand out:

1) Emissions

First, the annual carbon dioxide and greenhouse-gas emissions of these two countries have already converged. While America's CO2 emissions in 1990 were almost twice the level of Chinese emissions, by 2006 China had overtaken the United States. They are the world's two largest emitters.

2) Historical responsibility

Second, cumulative emissions are particularly important, because it is the accumulated stock of greenhouse gases in the atmosphere that cause climate change. Any discussion of distributional equity in the climate realm therefore inevitably turns to considerations of historic responsibility. Looking at the period 1850–2010,  the United States led the pack, accounting for nearly 19% of cumulative global emissions of greenhouse gases, with the European Union in second place at 17%, and China third, accounting for about 12% of global cumulative emissions.  

But that picture is rapidly changing. Emissions are flat to declining throughout the industrialised world, while increasingly rapidly in the large emerging economies, in particular China. Depending on the relative rates of economic growth of China and the United States, as well as other factors, China may top all countries in cumulative emissions within 10 to 20 years.

3) Fuel sources

Third, China and the United States both have historically high reliance on coal for generating electricity — and both are trying to do something about it. At a time when US dependence on coal is decreasing (due to increased supplies of unconventional natural gas and hence lower gas prices) China continues to rely on this fossil fuel. But Beijing is very concerned about this dependence, partly because of the health impacts  of particulates and other pollutants.

Importantly, both countries have very large shale gas reserves. US output (and use for electricity generation) has been increasing rapidly, bringing down CO2 emissions. Chinese exploitation has been constrained by available infrastructure — it lacks pipelines — but that will change.

4) Policy approaches

Fourth, in both countries, sub-national market-based climate policies — in particular, cap-and-trade systems — are moving forward. In the case of China, seven pilot carbon markets at local level are under development. In the United States, California's ambitious AB-32 cap-and-trade system continues to make progress, while in the northeast, the Regional Greenhouse Gas Initiative (RGGI) is witnessing higher allowance auction prices due to the more severe targets recently adopted by the nine states involved.

5) Geopolitics

Fifth and finally, there is the reality of global geopolitics. If the  twentieth century was the American Century, then many observers, including leaders in China, anticipate (or at least hope) that the twenty-first century will be the Chinese Century. In this regard, I'm  reminded of a statement I have made before: "If it's your century, you don't obstruct, you lead."

For more information on this publication: Belfer Communications Office
For Academic Citation: Stavins, Robert N..“Chinese and US Climate Interests are Converging.” China Dialogue, May 6, 2014.

The Author

Robert N. Stavins