Posted on

Realizing the Promise of Paris: Three Ways of Strengthening Non-State and Subnational Climate Action

Photo by Sebastian Dooris, 17 November 2018. Creative Commons Licence.

Authors: Harro van Asselt, Sander Chan, Idil Boran, Thomas Hale, Lukas Hermwille, Charles Roger

Harro van Asselt, Sander Chan, Idil Boran, Thomas Hale, Lukas Hermwille, Charles Roger examine opportunities to strengthen climate action by non-state and subnational actors. Article was first published on the Global Policy website on 11 December 2020: https://www.globalpolicyjournal.com/blog/11/12/2020/realizing-promise-paris-three-ways-strengthening-non-state-and-subnational-climate.

Five years ago, governments from across the world came together in Paris to chart a new course for global climate policy. The Paris Agreement put in place a ‘ratchet mechanism’ through which countries submit national climate plans in the form of Nationally Determined Contributions (NDCs), which should be reviewed and strengthened periodically.

In the past year, new and updated NDCs have been trickling in, but the level of ambition still falls short of averting the most dangerous climate impacts. On the brink of a new decade for climate action, however, we see some cause for optimism. Several of the largest emitting economies, including China, the EU, Japan, South Korea and the UK have pledged to reduce emissions to net zero by 2050 or 2060. The incoming Biden-Harris administration is also expected to commit to becoming net-zero by 2050. However, real climate benefits crucially depend on whether governments actually live up to their promises. While mid-century pledges are relatively easily made, governments need to align short-term plans and policies, including their NDCs, with longer-term commitments.

The Paris Agreement creates a set of mechanisms for updating these government commitments at periodic intervals. However, the agreement’s architects did not limit themselves to government action alone. Accompanying the agreement was a decision that underscored the role of subnational and non-state actors, including cities, regions, businesses, investors, civil society organizations and the transnational initiatives and networks in which they are engaged. These ‘non-Party stakeholders’, the drafters recognized, can help drive domestic ambition, engage in efforts to mitigate greenhouse gas emissions and boost climate resilience, and bolster action by states and international organizations at the global level.

Accordingly, the last few years have witnessed the emergence of various activities through which the international climate regime seeks to drive non-state and subnational action. Examples include the Global Climate Action portal, which records subnational and non-state action; the Momentum for Change initiative, which highlights promising replicable and scalable projects; regular technical examination processes to identify climate mitigation and adaptation solutions; the Marrakech Partnership for Global Climate Action, which engages subnational and non-state actors through events at UN climate conferences; and regular progress reports in the form of a Yearbook of Global Climate Action.

These activities are flanked by other efforts to orchestrate non-state and subnational climate action, including the 2014 and 2019 UN Climate Summits hosted by the UN Secretary-General, and the 2018 Global Climate Action Summit convened by former California Governor Jerry Brown. In addition, thematic events and Regional Climate Weeks have been held in Africa, Latin-America and the Caribbean, and the Asia-Pacific region. Most recently, the Race to Zero campaign has seen cities, regions, businesses, investors and universities commit to net-zero carbon emissions by 2050, despite a global pandemic and massive economic fallout.

Five years after the Paris Agreement, how have these functionally and programmatically linked activities to mobilize non-state and subnational actors – which we refer to as the ‘Global Climate Action Agenda’ (GCAA) – fared? In a new article, we evaluate the progress under the GCAA along four criteria.

First, efforts to drive non-state and subnational action should be collaborative by sharing design and operational responsibilities between key orchestrators, including the UNFCCC Secretariat, COP presidencies, other international organizations, subnational and non-state actors, and governments. Where collaboration occurs, we should see multiple orchestrators coordinating their efforts to mobilize and record the efforts of others. Here we find some progress has been made. The new Climate Champions, for instance, have helped to broker action and link efforts. The Global Climate Action portal has facilitated the monitoring of commitments. By and large, however, this coordination remains event-driven rather than systematic.

Second, efforts should be comprehensive in that they mobilize climate action across the broad landscape of subnational and non-state engagement. Again, we find that this has occurred to some extent. Through collaboration between the UNFCCC Secretariat and external data partners, thousands of commitments and actions by non-state and subnational actors have been recorded, reflecting the scale and range of the activities underway. However, raw numbers tell only part of the story. Some sectors, such as aviation and fossil fuels, are underrepresented, as are adaptation actions.

Third, efforts should be evaluative by creating common methods and benchmarks to help governments and other actors assess progress. In recent years, progress has been made on methodologies to evaluate the impacts of subnational and non-state commitments. To harmonize data collection and methodologies, the UNFCCC Secretariat regularly convenes the ‘Climate Action Methodologies Data and Analysis’ (CAMDA) group. However, evaluations still focus heavily on mitigation, rather than for instance adaptation or the sustainable development co-benefits of climate action. Moreover, evaluations of the actual impacts of non-state and subnational climate action, rather than expected impacts, are essential for the credibility of such action.

Lastly, efforts should be catalytic, meaning that they generate and deepen climate action, particularly in thematic and geographic areas where more action is needed. So far, major efforts along these lines have been undertaken. A large number of actions are being recorded, and new initiatives, like the UNFCCC’s Lighthouse Awards, have been created to incentivize ambition and facilitate implementation of commitments. Still, the impact of these international orchestration activities remains unclear. Moreover, it is plainly evident that there is an under-representation of non-state and subnational climate action in developing and emerging economies. This is problematic, as most future greenhouse gas emissions are projected in the Global South, and many developing countries are also among the most vulnerable and should benefit from non-state and subnational climate adaptation actions.

Based on our evaluation, we identify three areas that require greater attention:

  1. Driving national implementation and ambition

A post-2020 GCAA should accelerate national-level implementation, amplify the ambition of NDCs, and inform countries’ long-term strategies for mid-century low-carbon development. Ambitious non-state and subnational actions could give governments the confidence to adopt more ambitious targets and can serve as experiments that can be expanded and scaled up at the governmental level. NDC labs, for instance, could help governments strengthen their capacities in specific areas. At the regional and national levels, context-dependent and nationally specific collaboration can further foster closer collaboration between governments, non-state and subnational actors. For example, the Alliances for Climate Action initiative aims to create supportive constituencies to encourage collaboration and to foster learning at the national level. Such efforts would go some way toward ensuring that non-state and sub-national actors have a broader impact on climate action, and the GCAA can help by expanding and improving on these sorts of initiatives.

  1. Enabling subnational and non-state climate action in developing and emerging economies

The GCAA emphasizes the need for greater action in developing and emerging economies. But it has yet to achieve a balanced geographic representation. To ensure this, regional and national processes could play a complementary role to the GCAA by enabling the participation of local stakeholders and by reducing language and logistical barriers, while providing more targeted and contextualized frameworks for discussion. In Latin America, for example, ActionLAC has helped to build the capacity of state and non-state actors to take meaningful climate action by assisting them from the initial planning of actions to the integration of contributions into more ambitious NDCs, taking into account the local context. Expanding on these experiences and extending them to other regions could help to encourage broader and deeper participation from non-OECD actors.

  1. Broadening climate action and maximizing sustainable development synergies

Non-state and subnational climate action can yield benefits to society, environment and economies. Widespread biodiversity loss, ecosystem degradation and climate change pose inter-related threats that exacerbate one another, for instance, leading  to increased risks to food security. ‘Ecosystem-based’, ‘nature-based’ or ‘planetary health’ approaches can all help maximize synergies and manage trade-offs between different sustainability aspects, and contribute to the simultaneous achievement of various Sustainable Development Goals (SDGs). Multiple platforms in the UN system are already engaging subnational and non-state actors across multiple issue areas through orchestration. While these platforms are separate, collaboration between the GCAA and other orchestrators could demonstrate synergies between climate action and the SDGs.

As the world seeks to recover from the COVID-19 crisis, a well-designed post-2020 GCAA can help governments meet and enhance their climate commitments, strengthen the subnational and non-state capacity for action, and help realize sustainable development. Although the first five years of the Paris Agreement has successfully generated an unprecedented number of commitments by state and non-state actors, a post-2020 GCAA needs to help translate state and non-state promises into tangible action. With the above recommendations, we can once more reinvigorate global climate politics and increase our chances to realize the transformation to a net-zero and climate-resilient economy.

Harro van Asselt is a Professor of Climate Law and Policy with the University of Eastern Finland Law School, and a Visiting Researcher with the Copernicus Institute of Sustainable Development at Utrecht University.

Sander Chan is a Senior Researcher at the Global Center on Adaptation and the German Development Institute/Deutsches Institut für Entwicklungspolitik (DIE), he is also Adjunct Assistant Professor at the Copernicus Institute of Sustainable Development at Utrecht University.

Idil Boran is an Associate Professor at the Department of Philosophy and Faculty Member at the Dahdaleh Institute for Global Health Research, York University and Associate Researcher at the German Development Institute/Deutsches Institut für Entwicklungspolitik (DIE).

Thomas Hale is Associate Professor in Global Public Policy, Blavatnik School of Government and fellow of St Antony’s College.

Lukas Hermwille is Project Coordinator at the Wuppertal Institute for Climate, Environment and Energy and PhD candidate at the Institute for Environmental Studies (IVM) at Vrije Universiteit Amsterdam.

Charles B. Roger is an Assistant Professor at the Institut Barcelona d’Estudis Internacionals (IBEI).

Posted on

Urgenda-ratkaisu: Ilmasto-oikeudenkäynnit ja tuomioistuinten rooli ilmastonmuutoksen torjunnassa?

Kirjoittaja: Pekka Niemelä, tutkijatohtori, UEF Law School 2020-2022

Hollannin korkein antoi joulukuussa 2019 uraauurtavan Urgenda-ratkaisun, jonka mukaan ilmastonmuutos uhkaa Euroopan ihmisoikeussopimuksessa (EIS) turvattuja oikeuksia, kuten oikeutta elämään. Se velvoitti Hollannin hallituksen kiristämään toimia ilmastonmuutoksen torjumiseksi ja nostamaan päästövähennystavoitteen kunnianhimoa 25:een prosenttiin vuoden 2020 loppuun mennessä perusteella, ettei maan aiempi tavoite vähentää päästöjä 20 prosentilla vuoden 1990 tasosta turvannut riittävällä tavalla näiden ihmisoikeuksien toteutumista. Hollannin hallitus on jo ryhtynyt toimenpiteisiin saavuttaakseen vaaditun 25 prosentin päästövähennystason tämän vuoden loppuun mennessä.

Erityyppisiä ilmasto-oikeudenkäyntejä on parhaillaan vireillä sadoittain ympäri maailmaa. Urgenda on ensimmäinen tapaus, jossa valtio on velvoitettu kiristämään ilmastopolitiikkaansa ihmisoikeusnäkökohtien perusteella. Urgenda-ratkaisu nostaa esiin kaksi tässä blogissa käsiteltävää kysymystä: voidaanko Hollannin korkeimman oikeuden ihmisoikeuksia koskevaa analyysiä hyödyntää muissa ilmasto-oikeudenkäynneissä ja mikä rooli tuomioistuimilla ylipäätään voi olla ilmastonmuutoksen torjunnassa?

Urgenda-ratkaisun keskeiset kysymykset

Urgenda-tapauksessa tapauksen nimeä kantava hollantilainen kansalaisjärjestö väitti, että Hollannin vuodelle 2020 asettama päästövähennystavoite oli riittämätön ja loukkasi Hollannissa asuvien ihmisten oikeutta elämään (EIS Artikla 2) sekä yksityis- ja perhe-elämään (Artikla 8). Tämän johdosta Urgenda-järjestö vaati, että tuomioistuinten on velvoitettava maan hallitus vähentämään päästöjä vähintään 25 prosentilla vuoden 2020 loppuun mennessä. Hollannin valtio kuitenkin kiisti, että vaadittu päästövähennystaso olisi oikeudellisesti velvoittava, tai että Euroopan ihmisoikeussopimuksen artikloista 2 ja 8 voitaisiin johtaa velvollisuus ryhtyä päästövähennystoimiin ilmastonmuutoksen torjumiseksi.

Euroopan ihmisoikeustuomioistuin (EIT) ei ole tähän mennessä ottanut kantaa ilmastonmuutokseen. Hollannin korkein oikeus kuitenkin piti EIT:n aiemman ratkaisukäytännön perusteella selvänä, että Euroopan ihmisoikeussopimuksen artiklat 2 ja 8 loivat Hollannin valtiolle positiivisen toimintavelvollisuuden ilmastonmuutoksen torjumiseksi, koska ilmastonmuutoksen aiheuttama uhka oli välitön ja todellinen. Tähän ei vaikuttanut se, että ilmastonmuutoksen haittavaikutukset ilmenevät hitaasti, osin vasta vuosikymmenten kuluessa. Tässä yhteydessä oikeus viittasi merenpinnan nousun Hollannille aiheuttamaan eksistentiaaliseen uhkaan. Urgenda-ratkaisun taustalla oli osapuolten yksimielisyys ilmastonmuutoksen haittavaikutuksista – äärimmäisistä helleaalloista, kuivuudesta, jäätiköiden sulamisesta ja merenpinnan noususta. Osapuolet olivat yksimielisiä myös siitä, että maapallon keskilämpötilan nousu tulee rajata Pariisin sopimuksen mukaisesti. Pariisin sopimuksen keskeisenä tavoitteena on rajoittaa “maapallon keskilämpötilan nousu selvästi alle 2 °C:ssa suhteessa esiteolliseen aikaan” ja pyrkiä “toimiin, joilla lämpötilan nousu saataisiin rajattua 1,5 °C:een suhteessa esiteolliseen aikaan tiedostaen, että tämä vähentäisi merkittävästi ilmastonmuutoksen aiheuttamia riskejä ja vaikutuksia.”

Tuomioistuin piti epärelevanttina Hollannin hallituksen esittämää argumenttia, ettei sen päästövähennystoimilla ole mitään käytännön merkitystä ilmastonmuutoksen torjunnassa johtuen maan pienestä osuudesta globaaleista kasvihuonekaasupäästöistä. Korkein oikeus katsoi, että jokaisen valtion vastuulla on tehdä omien mahdollisuuksiensa rajoissa päästövähennyksiä. Tätä vastuuperiaatetta tukivat paitsi YK:n ilmastosopimusjärjestelmän keskeiset määräykset niin myös YK:n alaisen Kansainvälisen oikeuden toimikunnan valtiovastuuta koskevat artiklat.

Asettaessaan valtiolle 25 prosentin päästövähennysvelvoitteen, korkein oikeus nojasi hallitustenvälisen ilmastopaneelin IPCC:n Neljänteen arviointiraporttiin vuodelta 2007. Sen mukaan maapallon keskimääräisen lämpötilannousun rajaaminen kahteen asteeseen edellyttää kehittyneiltä valtioilta 25-40 prosentin päästövähennyksiä vuoden 1990 tasosta vuoteen 2020 mennessä. Tähän haarukkaan on toistuvasti viitattu raportin julkaisua seuranneiden ilmastohuippukokousten päätöslauselmissa ja EU:n kannanotoissa. Lisäksi 25-40 prosentin vähennystavoite oli ollut Hollannin oman ilmastopolitiikan lähtökohta vuoteen 2011 asti. Korkein oikeus viittasi myös siihen, että vuoden 2007 jälkeen oli tullut ilmeiseksi, että turvallisena pidettävä lämpötilan nousu olikin vain 1,5 astetta, ja että lämpenemisen rajaaminen tähän edellytti entistä nopeampia ja mittavampia päästövähennystoimia. Hollannin (ja EU:n) asettama 20 prosentin vähennystavoite oli siten liian riskialtis ja osin epärealistinen strategia ottaen huomioon myöhemmin tarkoitetuksi tehtävien päästövähennysten tarvittava mittaluokka ja niiden aiheuttamat taloudelliset kustannukset.

Korkein oikeus katsoi tällä perusteella, ettei 20 prosentin vähennystavoite riittävällä tavalla taannut Euroopan ihmisoikeussopimuksen artikloissa 2 ja 8 turvattujen oikeuksien toteutumista, vaan IPCC:n raporttiin sisältyvää 25-40 prosentin vähennystasoa oli pidettävä eräänlaisena minimitavoitteena, johon kehittyneiden valtioiden tulisi yltää vuoteen 2020 mennessä. Päästövähennystason asettaminen haarukan alapäähän, 25 prosenttiin, oli ainoa käytännöllinen vaihtoehto ottaen huomioon vähennysten toteuttamiselle jäljellä oleva aika. Ratkaisussa todettiin myös, että tavoitetta ei voinut pitää mahdottomana tai suhteettomana. Vaikka IPCC:n raportti ja siihen nojanneet päätöslauselmat ja kannanotot eivät itsessään olleet oikeudellisesti sitovia, korkein oikeus katsoi, että ne heijastivat sitä normatiivista kehitystä ja ymmärrystä, joka oli tapahtunut ilmastonmuutoksen suhteen Euroopan ihmisoikeussopimuksen jäsenvaltioiden keskuudessa, ja joka siten oli huomioitava artiklojen 2 ja 8 tulkinnassa. Tämä lähestymistapa pohjautui EIT:n oikeuskäytännössään luomaan ns. common ground –metodiin, johon tuomioistuin viittasi ensimmäisen kerran Demir and Baykara v Turkki -tapauksessa, ja jonka mukaan EIT voi antaa ratkaisuissaan painoarvoa myös oikeudellisille velvoitteille ja tieteelliselle tiedolle, jotka eivät suoraan sido vastaajavaltiota.

Hollannin valtio väitti myös, ettei tuomioistuinten tehtävänä ole päättää päästövähennyksistä: niiden toteuttaminen edellyttää sosiaalisten ja taloudellisten näkökohtien punnintaa, joka on leimallisesti poliittista, kuuluen siten lainsäädäntövallan piiriin. Hollanti katsoi myös, että tuomioistuimen asettama päästövähennystaso rinnastuu määräykseksi luoda tietynsisältöistä lainsäädäntöä, mikä myös rikkoo eri valtioelinten välisen toimivallanjaon perusperiaatteita. Korkein oikeus kuitenkin katsoi tuomioistuinten tehtäväksi varmistaa, että poliittiset päättäjät pysyvät niiden oikeudellisten reunaehtojen sisällä, jotka määrittävät niiden harkintavallan rajoja ilmastonmuutoksen torjunnan suhteen. Euroopan ihmisoikeussopimus on yksi tuota harkintavaltaa rajaava instrumentti ja Hollannin tuomioistuinten tehtävänä on tulkita sopimusta EIT:n ratkaisukäytännön mukaisesti, joskus myös valtion intressien vastaisesti, jos sopimuksessa turvattujen oikeuksien toteuttaminen tätä edellyttää. Päästövähennystason asettamista 25:een prosenttiin ei voitu myöskään rinnastaa määräykseksi luoda tietynlaista lainsäädäntöä, koska Hollannin valtiolla säilyi täysimääräinen oikeus päättää niistä politiikkakeinoista (ml. lainsäädäntö), joilla vähennystaso saavutetaan.

Huomionarvoista on, että EIT:en on juuri jätetty valitus, jossa joukko portugalilaisia nuoria ja lapsia katsoo 33:n EIS:n jäsenvaltion (ml. Suomen) ilmastopolitiikan rikkovan heidän artikloissa 2, 8 ja 14 turvattuja oikeuksiaan. Kuten Pauli Rautiainen toteaa tapausta koskevassa blogikirjoituksessaan, on vaikeaa ennakoida, ottaako tuomioistuin asiaa ylipäätään tutkittavaksi.

Urgendan merkitys ja tuomioistuinten rooli taistelussa ilmastonmuutosta vastaan

Urgenda ratkaisua voi pitää merkittävänä ennakkotapauksena. Se osoittaa, että yleisistä perus- ja ihmisoikeusvelvoitteista voidaan johtaa konkreettisia vaatimuksia valtion ilmastopolitiikalle. Hollannin korkeimman oikeuden ei tarvinnut arvioida Hollannin ilmastopolitiikan ja ilmastonmuutoksesta aiheutuvien ihmisoikeusloukkauksien välistä syy-seuraussuhdetta, koska osapuolet olivat yksimielisiä ilmastonmuutoksen aiheuttaman uhan olemassaolosta. Perusoletuksena voidaankin pitää, että tuomioistuimet eivät kyseenalaista kasvihuonekaasujen ja ilmaston lämpenemisen (ja sen seurannaisvaikutusten) välistä suhdetta. Toinen ja vaikeampi kysymys on se, minkälaista näyttöä tuomioistuimet edellyttävät väitetyistä oikeudenloukkauksista. Urgendassa oikeudenloukkaukset olivat vasta tulevaisuudessa realisoituvia ja niiden uhreiksi katsottiin Hollannin koko väestö. Merenpinnan nousu uhkaa erityisesti Hollannin kaltaisia valtioita, joten on vaikea arvioida, miten tuomioistuimet suhtautuisivat ilmastonmuutokseen liittyviin ei-eksistentiaalisiin uhkiin, kuten erilaisiin sään ääri-ilmiöihin – voisivatko myös ne riittävällä tavalla uhata Artikloissa 2 ja 8 turvattuja oikeuksia.

Hollannin korkein oikeus johti 25 prosentin päästövähennystason IPCC:n Neljännestä arviointiraportista ja sitä tukevista päätöslauselmista ja kannanotoista. Yksi kysymys tulevaisuuden ilmasto-oikeudenkäyntejä ajatellen on, voitaisiinko samaa logiikkaa käyttää kyseenalaistamaan esimerkiksi EU:n ilmastopolitiikan kunnianhimo, jota pidetään riittämättömänä 1,5 asteen tavoitteen näkökulmasta. Ongelmaksi muodostunee, etteivät yksityishenkilöt tai kansalaisjärjestöt voi kyseenalaistaa EU:n ilmastopolitiikkaa ohjaavia lainsäädäntöinstrumentteja EU tuomioistuimissa asianosaisaseman puuttumisen vuoksi.  Asianosaisaseman olemassaolo edellyttää yleensä sitä, että tietty sääntelyinstrumentti vaikuttaa suoraan yksittäisen henkilön oikeuksiin ja velvollisuuksiin, eikä päästövähennyksiä asettava yleisen tason lainsäädäntö helposti täytä tätä perusedellytystä.

Juuri tällä perusteella EU:n yleinen tuomioistuin hylkäsikin kanteen ns. People’s Climate Case -tapauksessa, missä joukko yksityishenkilöitä vaatii EU:n keskeisen ilmastolainsäädännön kumoamista. Kantajien mukaan EU:n vuodelle 2030 asettama vähintään 40 prosentin päästövähennystavoite on riittämätön ja rikkoo heidän Euroopan perusoikeuskirjassa turvattuja oikeuksiaan, koska tavoite osaltaan vahvistaa sään ääri-ilmiöitä ja siten lisää vaarallisen ilmastonmuutoksen todennäköisyyttä. Kantajien mukaan EU:lla on tekninen ja taloudellinen kyky nostaa 2030 päästövähennystavoite vähintään 50 prosenttiin, mikä on myös ilmastotieteen ja Pariisin sopimuksen lämpötilatavoitteiden valossa ehdoton minimivähennystaso. Yleinen tuomioistuin seurasi ratkaisussaan vakiintunutta oikeuskäytäntöä toteamalla, ettei mikään kanneoikeuden perusedellytyksistä täyttynyt, koska kanteen kohteena olleita lainsäädäntöinstrumentteja ei ollut ”osoitettu” kantajille, eikä mikään instrumenteista myöskään koskenut kantajia ”suoraan ja erikseen”.

Kantajat ovat valittaneet päätöksestä EU tuomioistuimeen, mutta on vaikea ennustaa, löytyykö tuomioistuimelta rohkeutta muuttaa vakiintunutta asianosaisasemaa koskevaa oikeuskäytäntöään, koska se tulisi lisäämään tuomioistuimen tapauskuormaa, jopa merkittävästi. Urgendassa kansalaisjärjestön asianosaisaseman mahdollisti kansallisen lain selkeä sanamuoto, mutta tällainen prosessiväylä on harvinainen. Yksityishenkilöiden ja/tai kansalaisjärjestöjen kanneoikeus edellyttäisi siis joko vakiintuneiden tulkintojen muutosta tai selkeitä lainsäädäntöuudistuksia.

Myös toimivallanjakoa koskevat perusperiaatteet voivat vesittää Urgendan kaltaiset ilmasto-oikeudenkäynnit. Vaikka Hollannin korkein oikeus katsoi pysyvänsä omalla, lain soveltamiseen keskittyvällä tontillaan päätöksen antaessaan, ei ole itsestään selvää, että tuomioistuimet päätyvät samaan lopputulokseen muissa valtioissa. Hyvänä esimerkkinä tästä toimii Yhdysvalloissa vireillä ollut Juliana-tapaus, missä kantajina oli joukko nuoria ja lapsia. Heidän mukaansa liittovaltion fossiilitaloutta tukeva toiminta uhkaa heidän Yhdysvaltain perustuslaissa turvattuja oikeuksiaan vapauteen, elämään ja omistusoikeuteen, koska tällä toiminnalla on syy-yhteys keskilämpötilan nousuun ja henkilö- ja omaisuusvahinkoja aiheuttaviin sään ääri-ilmiöihin. Kanne perustuu ns. public trust -ajattelulle, jonka mukaan ilmakehä on maaperään ja mereen rinnastettava luonnonvara, jota liittovaltion pitää suojella nykyisiä ja tulevia sukupolvia varten. Liittovaltion tuomioistuin yhtyi nuorten näkemykseen ilmastonmuutoksen vaarallisuudesta, mutta hylkäsi kanteen, koska se katsoi, että kantajien vaatima fossiiliteollisuuden alasajo on poliittinen kysymys, jonka toteuttaminen kuuluu lainsäädäntö- ja toimeenpanovallan piiriin. Päätöksestä voi vielä valittaa, mutta on hyvin epätodennäköistä, että valitus menestyy.

Ilmasto-oikeudenkäynnit Suomessa?

Jos Urgendaa miettii Suomen näkökulmasta, on selvää, ettei lainsäädäntömme tarjoa selkeää väylää hallituksen ilmastopolitiikan haastamiseen tuomioistuinjärjestelmän kautta. Hallintoriidan mahdollista roolia on pohdittu, mutta on epäselvää kenellä olisi oikeus käynnistää kansallisen ilmastopolitiikan haastava hallintoriita, mitä edeltäviä toimenpiteitä prosessin käynnistäminen edellyttäisi, ja mihin lainkohtiin kantaja voisi vaatimuksensa perustaa. Ilmastolakia ollaan parhaillaan uudistamassa, mutta puitelakina sitä ei ainakaan tällä hetkellä voi hyödyntää ilmastopolitiikan haastamisessa. Toisaalta Euroopan ihmisoikeussopimus edellyttää jäsenvaltioilta tehokkaiden oikeussuojakeinojen olemassaoloa suhteessa sopimuksessa turvattuihin oikeuksiin. Yleisellä tasolla voi siis todeta, että jos kansallinen lainsäädäntö ei tarjoa oikeussuojakeinoja suhteessa ilmastonmuutoksen aiheuttamiin oikeudenloukkauksiin, oikeudenloukkauksen uhri voi tehdä valituksen suoraan EIT:lle.

Toisaalta Marinin hallituksen ilmastotavoitteet ovat poikkeuksellisen kunnianhimoisia ja tieteeseen perustuvia sekä kansainväliset oikeudenmukaisuusnäkökohdat huomioivia. Vuodelle 2035 asetettua hiilineutraalisuustavoitetta uskottavasti toteuttavien politiikkatoimien käyttöönotto tällä hallituskaudella tekisi Urgendan kaltaisesta prosessista pitkälti tarpeettoman. Lisäksi Suomen maantieteellisen sijainnin johdosta voi kysyä, mitä olisivat ne konkreettiset oikeudenloukkaukset, joihin Urgendan kaltainen prosessi voisi perustua. Hollannissa merenpinnan nousu on konkreettinen ja vakava uhkatekijä, mutta uhkaako meitä jokin vastaava ilmaston lämpenemisen aiheuttava vaara, vai hyväksyisikö tuomioistuin argumentin siitä, että ilmastonmuutoksen yleiset haittavaikutukset on tulkittava Artikloissa 2 ja 8 suojattujen oikeuksien loukkaukseksi?

Ilmasto-oikeudenkäyntien merkitys

Ilmasto-oikeudenkäynnit ovat edelleen melko uusi strategisen litigaation muoto. Käynnissä olevia oikeudenkäyntejä on satoja, ja uusia kanteita ja valituksia nostetaan lähes viikoittain. Myös uusista ratkaisuista uutisoidaan tiheästi. Tuorein merkittävä ratkaisu oli Irlannin korkeimman oikeuden yksimielinen päätös, jossa se määräsi maan hallituksen laatimaan uuden, vuoteen 2050 ulottuvan ilmastonmuutoksen torjuntaa koskevan kansallisen suunnitelman. Määräys perustui maan sisäiseen lakiin, joka velvoittaa Irlannin vähentämään päästöjään 80:llä prosentilla vuoteen 2050 mennessä. Korkeimman oikeuden mukaan lain pohjalta tehdystä hallituksen päästövähennyssuunnitelmasta ei riittävällä tavalla selvinnyt, miten Irlanti tulee saavuttamaan 80 prosentin päästövähennystavoitteen. Kantajana tapauksessa oli Urgendan tapaan kansalaisjärjestö.

Vaikka yleisellä tasolla on ennenaikaista arvioida mikä ilmasto-oikeudenkäyntien kokonaisvaikutus tai merkitys on, aiheesta on julkaistu jo jonkin verran tutkimustietoa. Esimerkiksi Yhdysvalloissa tehdyn tutkimuksen mukaan hieman yli 300:ssa tapauksessa lopputulosta voi luonnehtia päästösääntelyä vastustavien voitoksi, ja noin 220:ssa tapauksessa lopputulos oli sääntelyä tukeva. Tulos ei ole yllättävä. Päästöintensiivistä taloudellista toimintaa suojaa vahva oikeudellinen tukiverkko, jonka perustan muodostavat omaisuuden suojan ja elinkeinovapauden kaltaiset perusoikeussäännökset. Fossiilitalous kytkeytyy myös ekologisesti kestämättömään, kulutuskeskeiseen elämäntapamme, jonka kansantaloudellisia ja työllisyysvaikutuksia on mahdotonta kiistää. Toisaalta Urgenda osoittaa, että tuomioistuinten päätöksillä voi olla merkittäviä päästöjä vähentäviä vaikutuksia, vaikka tuomioistuinten kädet ovatkin usein sidotut asianosaisasemaa ja toimivallanjakoa koskevien perusperiaatteiden johdosta.  Ilmasto-oikeudenkäynneillä on tietenkin usein toistettu julkisuusfunktio siinä mielessä, että ne saavat usein runsaasti huomiota. Tässä mielessä ne voidaan nähdä – lopputuloksesta riippumatta – osana laajempaa pyrkimystä vaikuttaa julkiseen mielipiteeseen ja paineen luomiseen tehokkaampien päästövähennystoimien tekemiselle. Perus- ja ihmisoikeustapaukset ovat myös tärkeitä testitapauksia siinä mielessä, että ne osoittavat selkeämmin ne rajat, joihin ilmastonmuutokseen ja perus- ja ihmisoikeuksiin liittyvät argumentit törmäävät yksittäisissä oikeusjärjestyksissä. Näiden rajojen tunnistaminen tuo esiin lainsäädäntömuutosten välttämättömyyden.

Posted on

Vapaaehtoisten päästöhyvitysten sääntelyyn tarvitaan selkeyttä

Kirjoittajat: Hanna-Mari Ahonen, Kari Hämekoski, Matti Kahra, Kati Kulovesi, Anna Laine ja Maija Saijonmaa

Kasvava huoli ilmastonmuutoksesta on lisännyt kasvihuonekaasupäästöjen vapaaehtoisen hyvittämisen eli päästökompensaation suosiota. Julkisuuteenkin nousseet ongelmat osoittavat, että toiminnan sääntely laahaa jäljessä. Nostamme tässä kirjoituksessa esiin kaksi tärkeintä ongelmaa peräänkuuluttaen sekä selkeyttä kompensaatiomarkkinoiden toimintaympäristöön että päästökompensaatioiden laadun riittävää varmistamista.

Kompensaatio täydentää, mutta ei korvaa omia toimia päästöjen vähentämiseksi

Kompensoinnin logiikka on periaatteessa selkeä. Siltä osin kun valtio, yritys tai yksityishenkilö ei pysty itse vähentämään päästöjään lyhyellä tähtäimellä kustannustehokkaasti, on mahdollista maksaa jollekin toiselle siitä, että päästöt vähenevät. Ilmakehän ja ilmastonmuutoksen näkökulmasta päästöjen vähentämispaikalla ei ole merkitystä. Päästöjä voidaan yhä vähentää kehitysmaissa jopa kertaluokkaa edullisemmin kuin EU:ssa.

Yrityksen tai yksityishenkilön näkökulmasta oman hiilijalanjäljen hyvittämisen voi nähdä keinona kantaa vastuuta niistä arjen päästöistä, joita ei syystä tai toisesta ole mahdollista välttää. Päästöjen kompensointi on toisaalta herättänyt myös vastustusta. Pahimmillaan sitä on luonnehdittu eriarvoistavaksi anekaupaksi, jonka turvin varakkaat henkilöt tai valtiot voivat jatkaa saastuttavaa elämäntyyliään. Kompensaatioon liittyy myös laajempi kysymys yksilöiden ja valtioiden vastuusta ilmastonmuutoksen torjunnassa.

Ihannetapauksessa vapaaehtoista kompensaatiota ei tarvittaisi, vaan eri maat ryhtyisivät riittävän kunnianhimoisiin toimiin Pariisin sopimukseen sisältyvän 1,5 asteen tavoitteen saavuttamiseksi. Tällä hetkellä globaalien ilmastotoimien taso on kuitenkin YK:n ympäristöohjelma UNEP:in mukaan selvästi riittämätön. Nykytoimet yltävät vain viidennekseen tarvittavista päästövähennyksistä ja ovat aiheuttamassa yli kolmen asteen nousun maapallon keskilämpötilassa.  Vapaaehtoisilla ja aina luonteeltaan täydentävillä lisätoimilla pyritään kuromaan umpeen tätä kuilua – eräänlaisena kiireapuna.  

Päästökompensaatiosta on tyypillisesti myös muita kuin ilmastollisia hyötyjä. Nämä riippuvat hankkeen tyypistä, sijainnista ja toteutuksesta. Syrjäisten kylien sähköistäminen aurinkopaneeleilla voi tukea koulunkäyntiä ja pienyrityksiä, ekoliedet voivat säästää metsiä sekä naisten ja tyttöjen aikaa. Metsityshankkeet voivat suojata eroosiolta ja kuivuudelta sekä vaalia luonnon monimuotoisuutta. Pariisin sopimuksessa hankkeiden kestävän kehityksen hyötyjä on entisestään painotettu.

Päästövähennyshanke voi toki aiheuttaa myös haittoja, kuten mikä tahansa huonosti ja vastuuttomasti toteutettu hanke. Käytännössä ongelmia ovat aiheuttaneet niin ympäristölliset kuin sosiaaliset ja ihmisoikeusnäkökohdatkin.  

Milloin päästökompensaatio on vastikkeetonta? Arpajaislain tulkintaa on tarve selkiyttää tavalla, joka huomioi hiilimarkkinoiden olemassaolon

Päästökompensaatiota tarjoavien yritysten ja muiden toimijoiden näkökulmasta suomalainen toimintaympäristö on tällä hetkellä vähintäänkin hämmentävä. Arpajaishallinnon tulkinta, joka luokittelee Finnairin ja Compensate-säätiön kompensaatiojärjestelmät rahankeräyslupaa edellyttäväksi vastikkeettomaksi hyväntekeväisyydeksi, on herättänyt kritiikkiä ilmastoasiantuntijoiden keskuudessa. Tämä johtuu siitä, että päästövähennysyksiköille on syntynyt  kaupallinen  arvo jo yli 20 vuotta sitten kansainvälisten hiilimarkkinoiden kautta.

Arpajaishallinnon kannanotot kompensaatiojärjestelmistä sen sijaan korostavat ilmastonsuojelutyötä hyväntekeväisyytenä. Päästöhyvitysten rahoittajat eivät sen mukaan saa vastineeksi mitään ’tosiasiallista hyödykettä kuten istutettua puuta tai tosiasiallista päätäntävaltaa päästövähennyshankkeen hallinnointiin,’ vaan ainoastaan lupauksen, että rahat käytetään ilmastonmuutoksen torjumiseksi. Päästövähennysten myönteisistä vaikutuksista pääsevät lisäksi nauttimaan kaikki nekin henkilöt, jotka eivät ole valinneet ostopäätöstä tehdessään kompensoitua tuotetta. Arpajaishallinto onkin rinnastanut päästökompensaation lähinnä kummilapsitoimintaan.

Näistä kannoista syntyy mielikuva, ettei hiilimarkkinoiden toimintamallia ole sisäistetty. Vaikka päästöjen vähentämisestä hyötyvät kaikki, vastuuta tästä valtavasta globaalista urakasta on pyritty jakamaan eri toimijoille sekä oikeudellisesti sitovin keinoin että erilaisten kannustimien ja vapaaehtoisten järjestelmien kautta. Päästökauppa on ilmastopolitiikan ohjauskeino, joka on käytössä muun muassa kansainvälisessä Kioton pöytäkirjassa, Euroopan unionissa (EU), Kaliforniassa sekä Kiinassa. Päästökaupan piiriin kuuluvien toimijoiden on luovutettava vuosittain viranomaisille päästökaupan piiriin kuuluvia päästöjään vastaava määrä päästöoikeusyksiköitä. Esimerkiksi EU:ssa tämä velvoite koskee yli 11 000 toimijaa ja EU:n päästöoikeusyksiköitä koskevat huutokaupat tuottivat jäsenmaiden viranomaisille vuonna 2018 yhteensä yli 14 miljardia euroa. Vapaaehtoisilla hiilimarkkinoilla puolestaan vaihdettiin 2018 päästöyksiköitä yhteensä lähes 300 miljoonalla dollarilla.

Päästöoikeusyksiköiden olemassaolo perustuu esimerkiksi EU:ssa lainsäädäntöön ja niillä on kysynnän ja tarjonnan funktiona muodostuva markkinahinta. Yksiköiden oikeudellista luonnetta ei ole EU:ssa yhdenmukaisesti säännelty, vaan eri jäsenmaiden oikeusjärjestelmät määrittelevät ne eri tavoin esimerkiksi hallinnolliksi luviksi tai aineettomiksi oikeuksiksi. Näistä jälkimmäinen vastaa verottajan Suomessa omaksumaa lähestymistapaa. Myöskään EU:n tuomioistuin ei ole nähnyt tarpeelliseksi tyhjentävästi määritellä EU:n päästökauppajärjestelmän piirissä vaihdettavien yksiköiden oikeudellista luonnetta. Olennaista on, että yksiköillä on taloudellinen arvo ja niillä käydään vakiintuneesti kauppaa päästöoikeusmarkkinoilla.

Eri päästökauppajärjestelmissä on saatettu mahdollistaa myös järjestelmän ulkopuolisten eli muiden kuin viranomaisten myöntämien päästöyksiköiden käyttö. Tällaisia yksiköitä ostetaan päästövähennyksiä toteuttavista tai hiilinieluja lisäävistä hankkeista eri puolilla maailmaa. Ostajat eivät tyypillisesti itse osallistu hankkeiden hallinnointiin, eivätkä saa omistusoikeutta esimerkiksi istutettuihin puihin tai hankkeen puitteissa asennettuihin aurinkopaneeleihin.  Vaihdannan kohteena ovat sen sijaan erilaisten kansainvälisten standardien mukaisesti sertifioidut päästöyksiköt. Esimerkiksi Compensaten ja Finnairin kompensaatiotoiminta perustuvat tällaisten yksiköiden hankkimiseen.  

On mahdollista – joskaan ei arpajaishallinnon kantojen perusteella riittävän selvää – että päätös määritellä tietty suomalainen kompensaatiotoiminta vastikkeettomaksi hyväntekeväisyydeksi johtuu valitusta toimintamallista. Toiminnan luokittelu vastikkeettomaksi hyväntekeväisyydeksi voisi johtua esimerkiksi siitä, ettei kompensaatiomaksuilla hankittavien päästöyksiköiden hintaa, määrää ja luonnetta ole riittävän tarkasti määritelty tai ettei toimintaa ole luonnehdittu palveluksi, joka sisältää sekä hyvitysyksiköiden hankkimisen että niiden mitätöinnin asiakkaan puolesta. Päästökompensaatiossa yksiköiden hankkiminen on nimittäin vain väliaskel ja vasta niiden poistaminen markkinoilta eli mitätöinti johtaa päästöjen kompensoitumiseen. Kompensaatiopalvelun tuottajat tyypillisesti hoitavat koko vaivalloisen, asiantuntemusta vaativan prosessin keskitetysti yksittäisten maksajien puolesta.

Arpajaishallinnon nykyiset kannat kompensaatiotoiminnan vastikkeettomuudesta ovat epäselviä luoden tarpeetonta epävarmuutta toimintaympäristöön. Kompensaatiotoiminnan oikeudellisten puitteiden selkiyttämiselle on tärkeä ilmastopoliittinen tilaus. Suomen lainsäädännön valossa on kiistatonta, että erilaiset päästöoikeusyksiköt voivat olla vastikkeellisen vaihdannan kohteena. Tätä säänteleviä lakeja ovat esimerkiksi päästökauppalaki, laki lentoliikenteen päästökaupasta sekä laki Kioton mekanismien käytöstä. Myös verottaja on antanut ohjeistusta päästöoikeuksien kaupan verotuksesta.  Ainoa ilmastopoliittisesti ja oikeudellisesti perusteltavissa oleva tulkinta onkin ottaa arpajaislain soveltamisen lähtökohdaksi hiilimarkkinoiden sekä taloudellisen arvon omaavien päästöyksiköiden olemassaolo.

Tästä lähtökohdasta on selvää, että kompensaatiojärjestelmien on periaatteessa mahdollista toimia tavalla, joka täyttää vastikkeellisuuden kriteerit. Esimerkiksi järjestelmä, joka siirtäisi maksajalle omistusoikeuden Suomen lainsäädännössä määriteltyihin EU:n päästöoikeusyksiköihin tai CDM-hankkeista saataviin yksiköihin olisi kiistatta vastikkeellinen. Lisäksi myös erilaisiin vapaaehtoisilla markkinoilla vakiintuneisiin päästöyksiköihin – joita on määritelty tarkemmin esimerkiksi Ilmastopaneelin raportissa – perustuvan kompensaatiotoiminnan luokittelulle vastikkeelliseksi on vahvat perustelut.

Arpajaishallinnon tulisikin määritellä vastikkeellisina ja vastikkeettomina pidetyn kompensaatiotoiminnan yksityiskohdat tavalla, joka aidosti hyödyttää alan toimijoita ja luo niiden toiminnalle selkeät sekä ennakoitavat puitteet. Tämän jälkeen on mahdollista arvioida, onko lainsäädäntöä tarpeen lisäksi muuttaa ilmastopolitiikan tarpeita paremmin palvelevaksi.

Miten varmistaa tarjolla olevien päästöhyvitysten laatu?

Toinen haaste on, että vapaaehtoisista kompensaatiomarkkinoista on nopeasti kehittymässä suoranainen ”villi länsi.” Suomeen on syntynyt viime aikoina esimerkiksi useita kotimaisia metsänistutushankkeita, joita markkinoidaan hiilijalanjäljen kompensointiin, mutta jotka tosiasiassa tukevat vain Suomen valtion tavoitetta. Suomessa ja muualla toteutettavat kompensaatiopalvelut ovat ilmastonäkökulmasta muutenkin varsin kirjavia, mikä on herättänyt tärkeän keskustelun tarjolla olevien päästöhyvitysten laadusta. Pahimmillaan tarjolla on ”kuumaa ilmaa” eli hyvityksiä, jotka eivät tosiasiassa vähennä päästöjä eivätkä edistä ilmastonmuutoksen torjumista.

Laadukas päästöjen hyvittäminen edellyttää ensinnäkin, että kompensaatioon käytetään lisäisiä päästövähennyksiä. Näillä tarkoitetaan toimia, jotka menevät voimassa olevaa lainsäädäntöä pidemmälle, eivät ole taloudellisesti kannattavin vaihtoehto eivätkä siten todennäköisesti toteutuisi ilman päästöyksikön myynnistä saatavan maksun tarjoamaa lisätukea.

Laadukas päästöjen hyvittäminen edellyttää lisäksi luotettavia menetelmiä toteutuneiden päästövähennysten mittaamiseksi sekä riippumattoman kolmannen osapuolen toimesta tapahtuvaa todentamista. Laadun osalta on tärkeää huomioida myös ilmastovaikutuksen pysyvyys, joka on etenkin hiilensidontaan eli tyypillisesti metsähankkeisiin liittyvä haaste.

Uusi päästöyksiköiden laatuun vaikuttava haaste on lisäksi nk. ’kaksoislaskenta.’ Tämä tarkoittaa sitä, että kaksi tai pahimmassa tapauksessa useampikin eri taho laskee saman päästövähennyksen hyväkseen.

Kaksoislaskennan ongelmaa voi havainnollistaa Suomea koskevalla esimerkillä. Esimerkiksi puiden istuttaminen Suomessa on ilmastoteko, mutta sellainen, josta aiheutuvat ilmastohyödyt Suomen valtio laskee automaattisesti omaksi hyväkseen pitäessään kirjaa edistyksestä kohti kansainvälisiä ilmastovelvoitteitaan. Tästä seuraa, etteivät suomalaiset yritykset tai yksityishenkilöt pääsääntöisesti voi nykyjärjestelmän puitteissa uskottavasti kompensoida omia päästöjään Suomessa toteutettavilla toimilla.

Sama ongelma koskee kaikkia vuodesta 2021 soveltuvan Pariisin sopimuksen piirissä olevia maita –  197 sopijapuolen sitoutuminen ilmastonmuutoksen torjuntaan on merkittävästi lisännyt kaksoislaskennan riskiä verrattuna Kioton pöytäkirjaan, jonka ulkopuolelle jäivät mm. kehitysmaiden päästöt. Ongelman ratkaisu edellyttää kaksoislaskennan estävän järjestelmän luomista. Pariisin sopimukseen sisältyykin tätä koskeva vaatimus kansainvälisen päästökaupan yhteydessä. Kansainväliset neuvottelut kaksoislaskennan estävän järjestelmän yksityiskohdista ovat kuitenkin vielä kesken.

Kansainvälisiä periaatteita voi järjestelmän valmistuttua soveltaa myös vapaaehtoiseen kompensaatioon. Suomi voisi myös oma-aloitteisesti perustaa rekisterin, johon kerättäisiin viranomaisten hyväksymien vapaaehtoisten toimien aikaansaamat päästövähennykset ja hiilinielujen lisäysten aikaansaamat poistot (kokonaan tai osittain). Sen lisäksi Suomen tulisi sitoutua ylittämään kansainväliset päästövähennysvelvoitteensa vähintään rekisteriin merkittyjen päästövähennysten määrällä. Tällainen järjestelmä mahdollistaisi kotimaisten päästövähennysten käytön ilmastonäkökulmasta uskottavasti myös muiden toimijoiden kuin Suomen valtion hiilineutraaliuspyrkimyksiin.

Päästöyksiköihin liittyviä kaksoislaskenta- ja laatuongelmia voisi ratkoa myös yhteispohjoismaisesti. Viime vuonna Pohjoismaat kannustivat yhteisessä hiilineutraaliusjulistuksessaan pohjoismaisia yrityksiä, sijoittajia, kuntia, kaupunkeja, järjestöjä ja kansalaisia vauhdittamaan omia hiilineutraaliuspyrkimyksiään. Pohjoismaat voisivat yhdessä pohtia ja kehittää keinoja laadukkaan vapaaehtoisen kompensaation edistämiseksi kotimaista ilmastopolitiikkaa täydentävinä toimina.

Jo kaksi vuosikymmentä päästövähennysten sertifiointia

Päästöyksiköiden laadun varmistavaa järjestelmää ei tarvitse luoda tyhjästä. Sekä YK:n ilmastosopimusjärjestelmä että useat vapaaehtoiset järjestelmät ovat tehneet kaksi vuosikymmentä työtä luodakseen luotettavat käytännöt päästövähennyshankkeiden sertifiointiin. Vuonna 2000 käynnistynyt Kioton pöytäkirjan puhtaan kehityksen mekanismi (Clean Development Mechanism, CDM) on järjestelmistä vanhin ja tunnetuin. Nyt CDM on kuitenkin väistymässä uuden, Pariisin sopimukseen perustuvan mekanismin tieltä, jonka yksityiskohdista vielä neuvotellaan.

Vapaaehtoiseen kompensaatioon käytetään pääasiassa muiden kansainvälisten järjestelmien, esimerkiksi kansalaisjärjestöjen perustaman Gold Standardin, puitteissa sertifioituja päästövähennysyksiköitä. Vapaaehtoiset hiilimarkkinat toimivat siis osittain päällekkäin ja osin rinnakkain velvoitteita palvelevien hiilimarkkinoiden kanssa, ja näillä markkinoilla käydään kauppaa useilla päästöyksikkötyypeillä.

Yritysten ja kuluttajan näkökulmasta vakiintuneisiin kansainvälisiin standardeihin perustuvien päästöyksiköiden hankkiminen on varmin tapa pyrkiä varmistamaan kompensaation todellinen ilmastohyöty. Toisaalta ongelmia on raportoitu myös esimerkiksi CDM- ja Gold Standard -hankkeisiin liittyen. Ylipäätään päästöyksiköiden laatu vaihtelee eri järjestelmien välillä – ja myös niiden sisällä. Kompensaatiopalvelujen tarjoajilla on tärkeä rooli hankkeiden laadun yksityiskohtaisessa arvioinnissa asiakkaidensa puolesta.

Viranomaiset voivat edistää vapaaehtoisen kompensaation laatua esimerkiksi laatimalla suositukset vapaaehtoisen kompensaation minimikriteereistä. Niitä voisivat olla lisäisyyden osoittaminen, vankkojen laskentamenetelmien käyttäminen ja riippumattoman osapuolen suorittama todentaminen olemassa olevien standardien mukaisesti, sekä vankat ja läpinäkyvät prosessit kaksoislaskennan estämiseksi. Tulkinnanvaran vähentämiseksi viranomaiset voivat suositella olemassa olevien standardien käyttöä, ja päästövähennysyksiköiden mitätöintiä läpinäkyvästi standardien hallinnoimissa päästörekistereissä.

Esimerkkejä vastaavista toimintamalleista tarjoavat kansainvälisen ilmailualan CORSIA-päästöhyvitysjärjestelmä ja Perun vapaaehtoinen hiilijalanjälkijärjestelmä, jotka hyväksyvät vain tietyt standardit. CORSIA hyväksyy lisäksi vain tietyn ajankohdan jälkeen alkaneet päästövähennyshankkeet. Peru kokoaa tiedot vapaaehtoista kompensaatiota varten mitätöidyistä yksiköistä kansalliseen tietokantaan. Costa Rican ilmastoviranomaiset ovat puolestaan kehittäneet kansallisen standardin vapaaehtoisille ilmastohankkeille, jotka edistävät maan hiilineutraaliuspyrkimyksiä. Suomi voisikin hyödyntää tässä suhteessa Perun ja Costa Rican malleja, joita on itse asiassa rahoitettu muun muassa Suomen tuella.

Nykysääntelyn vahvistaminen ja selkiyttäminen on tarpeen

Päästökompensaatio on ilmastopoliittisesti tärkeä ja kustannustehokas tapa täydentää nykyisiä, 1,5 asteen tavoitteen näkökulmasta selvästi riittämättömiä ilmastotoimia. Lisäksi se tukee useiden eri toimijoiden hiilineutraalisuustavoitteita ja kestävää kehitystä kohdemaissa. Tätä taustaa vasten Suomessa olisi tärkeä ryhtyä toimiin sekä kompensaatiomarkkinoiden toimintaympäristön selkiyttämiseksi että päästökompensaatioiden laadun riittäväksi varmistamiseksi.

Hanna-Mari Ahonen on vanhempi konsultti ilmastopolitiikkaan erikoistuvassa Perspectives -konsulttiyrityksessä. Hän on työskennellyt vuodesta 2002 lähtien kansainvälisten päästövähennyshankkeiden ja päästöjen hinnoittelun parissa sekä julkisella että yksityisellä sektorilla. Hanna-Mari on osallistunut hiilimarkkinoiden kehittämiseen ja toimeenpanoon monessa roolissa mm. Suomen Kioton mekanismien koe- ja osto-ohjelmissa, useissa kansallisissa ja kansainvälisissä hiilirahastoissa, YK:n ilmastoneuvotteluissa ja Pariisin sopimuksen hiilimarkkinapiloteissa.

Kari Hämekoski on työskennellyt 20 vuotta kansainvälisten päästövähennyshankkeiden parissa mm. Suomen Kioton mekanismeja testaavassa koeohjelmassa, Maailmanpankissa sekä Pohjoismaiden ympäristörahoitusyhtiössä NEFCOssa.

Matti Kahra on johtava asiantuntija ilmasto -ja kiertotalousasioissa Elinkeinoelämän keskusliitossa. Hän on työskennellyt ilmastopolitiikan parissa yli 10 vuotta sekä julkisella että yksityisellä sektorilla, keskittyen erityisesti päästöjen hinnoitteluun ja markkinamekanismeihin. Matti on osallistunut päästömarkkinoiden kehitys -ja toimeenpanotyöhön eri tasoilla mm. Suomen Kioton mekanismien osto-ohjelma, kansainvälisten kehityspankkien päästömarkkinaohjelmat sekä neuvottelijana YK:n ilmastoneuvotteluissa.

Kati Kulovesi on kansainvälisen oikeuden professori ja Ilmasto-, energia- ja ympäristöoikeuden keskuksen johtaja Itä-Suomen yliopistossa. Hän on työskennellyt ilmasto-oikeuden sekä kansainvälisen kauppaoikeuden parissa yli 20 vuotta ja toimi Suomen ilmastopaneelin jäsenenä kaksi kautta välillä 2014-2019.  Hän oli Suomen Kioton mekanismeja testaavan koeohjelman oikeudellinen neuvonantaja v. 2001-2003 ja on sen jälkeen konsultoinut mm. ympäristö- ja ulkoministeriötä, NEFCOa sekä Maailmanpankkia hiilimarkkinoihin liittyvissä oikeudellisissa kysymyksissä. 

Anna Laine on Gaia Consulting Oy:n vanhempi asiantuntija, jolla on 15 vuoden kokemus ilmastopolitiikasta, kompensointimekanismeista ja päästövähennyshankkeista, sekä julkiselta että yksityisellä sektorilta. Hän työskenteli vuosina 2007-2014 Suomen Kioton mekanismien osto-ohjelmassa ja on tukenut Suomen valtiota esimerkiksi Pariisin sopimuksen toimeenpanossa. Hän on lisäksi hallinnoinut yksityisiä päästöyksikkörahastoja ja auttanut useita yrityksiä kompensointihankkeiden valinnassa.

Maija Saijonmaa on Nordic Offset Oy:n johtava asiantuntija sekä toimii teknologia- ja ympäristöasiantuntijana Pohjoismaiden ympäristörahoitusyhtiössä (NEFCOssa). Hänellä on yli 15 vuoden kokemus ilmastorahoituksesta ja päästövähennyshankkeista sekä yksityiseltä sektorilta että kansainvälisestä rahoituslaitoksesta. Hän on kehittänyt päästövähennyshankkeiden laskentametodologioita ja työkaluja  päästövähennyshankkeiden lisäisyyden tarkasteluun, analysoinut lukuisten eri teollisuussektorien päästövähennyshankkeiden laatuvaatimusten toteutumista sekä hallinnoinut julkisia ja yksityisiä päästöyksikkörahastoja.

Posted on

Saving the world’s forests: What’s (international) law got to do with it?

Author: Eugenia Recio, PhD Researcher

Natural forests, particularly in tropical regions, are essential for life. They are pools of biodiversity, contribute to combating climate change by storing carbon, and sustain the livelihoods of many indigenous and local communities across the world.

In the past weeks, however, worrying images of record-breaking fires destroying forests in the Amazon, Asia, the Arctic, Africa and other parts of the world have underlined that the world’s forests are still at major risk. These events are a blow to international efforts to counteract critical biodiversity loss and climate change, and raise vexed questions about the role of international law in addressing global forest loss.

To date, international law has been of limited use in terms of protecting the world’s forests. Heavily forested countries, including Brazil, have seen proposals to adopt a global treaty on forests as a threat to their national sovereignty and to their ability to take advantage of their forests for their economic development. While the role of states is changing with globalization and global environmental problems, sovereignty remains the cornerstone of international law and significantly limits the ability of other countries to intervene in countries’ decisions affecting the status of their natural resources. Indeed, the recognition by the UN of countries’ permanent sovereignty over natural resources in 1962 was a major achievement for developing countries in the context of decolonization. However, this principle has always had a tense relationship with international environmental law and the need to safeguard the planet and its natural resources for present and future generations.

As such, the need to take urgent action to halt deforestation has been recognized by the international community at various instances. In 2017, the UN Strategic Plan for Forests 2017-2030 (UNSPF) called for reversing the loss of forest cover and increasing forest areas by 3% worldwide by 2030. Under the Sustainable Development Goals, a global target on halting deforestation by 2020 was adopted. In 2014, governments along with major companies such as Unilever and Nestle and other organizations adopted the New York Declaration on Forests, aimed at halving the loss of natural forests by 2020, and ending it by 2030. However, by 2017, the average annual rate of natural forest loss was 42% higher than in the previous decade. Signatory companies and states are clearly failing to meet their undertakings.

Overall, several instruments have been adopted at the margins of formal international law. The Forest Instrument, for example, is a non-legally binding instrument that has helped countries adopt national forest programmes.

The most detailed international rules on forest protection have been adopted under the UN climate regime. Notably, under the 2015 Paris Agreement, some countries have promised to reduce deforestation in their Nationally Determined Contributions (NDCs). However, there is no obvious legal remedy that could be used to ensure that countries implement their pledges.

In addition, a high-profile scheme known as REDD+, has been created under the UN climate regime with the objective of reducing deforestation and protecting the carbon stored in natural forests in developing countries. REDD+ has led to new financing initiatives substantially increasing the funding available for forest protection. Yet REDD+ implementation is completely voluntary. Furthermore, REDD+ rules favour results-based payments, meaning that countries first need to act on REDD+ before being compensated based on emission reductions. In other words, REDD+ countries do not take on obligations to reduce forest emissions or to maintain the results achieved in forest protection.

Home to the Amazon rainforest, Brazil was the regional champion in curbing deforestation between 2004 and 2012. Due to REDD+, the country has received more than US$ 1.2 billion from Norway and more than US$ 68 million from Germany in the Brazilian Amazon Fund since 2008. The Green Climate Fund, created under the UN climate regime, further approved a compensation of US$ 18.8 million for Brazil’s achievements in forest protection and emission reductions in 2014/2015.

However, the recent turn in environmental politics in Brazil following last year’s presidential election has put at stake the Amazon Fund and the funding available for protecting the Amazon rainforest. Together with Brazil’s new policies to promote rural expansion, this has resulted in a significant increase in human-induced forest fires and deforestation. It has been estimated that fires in the Amazonia have increased by 82% compared to the same period in 2018.  As a result, bilateral REDD+ donors have decided to freeze their funding to Brazil.

More recently, seven Amazonian countries, including Brazil, gathered to discuss the critical situation in the Amazon. They adopted the Leticia Agreement, including stipulations to cooperate jointly in addressing disasters. But the new agreement seems to be far from a solution to the fires because it contains only principles instead of prescribing specific actions. It is therefore difficult to expect that the Leticia Agreement will be more successful than the failed Amazonian Cooperation Treaty Organization (OTCA) adopted in 1978. The Agreement seems to rather respond to the international pressure to address the fires by reaffirming, twice, the sovereign rights of Amazon countries over their natural resources and territories.

These developments call into question the effectiveness of international non-legally binding instruments in addressing deforestation. Furthermore, they raise the question whether international financial support, such as through REDD+, to protect forests should involve obligations to maintain the results achieved.

The recent developments also raise questions about the role of international law in other ways. Some areas of international law, such as trade law, promote extensive agriculture and cattle ranching, which are the main drivers of developing countries’ deforestation. In other words, trade agreements tend to legitimize and support the very same activities that cause deforestation in the first place and that environmental soft law instruments seek to curtail. At the same time, in the case of Brazil, international trade agreements could also offer a vehicle to support forest protection.

Notably, a free trade agreement was recently signed between the EU and MERCOSUR – which includes Paraguay, Argentina, Uruguay and Brazil – after 20 years of negotiations. The EU-MERCOSUR Trade Agreement includes an environmental chapter and has been identified by many as potential weapon in the fight to save the Amazon. The Agreement requires Parties to respect the Paris Agreement where Brazil has pledged to ‘zero illegal deforestation by 2030’ in the Brazilian Amazon, and restore ‘12 million hectares of forests by 2030’ and ‘enhanc[e] sustainable native forest management systems [to curb] illegal and unsustainable practices’. As the EU-MERCOSUR Trade Agreement is yet to enter into force, some EU Member States are using it to generate political pressure, threatening to block the agreement’s ratification or ban imports of agricultural products, such as soy, from Brazil to reduce incentives for the clearing of the Amazon forest.

In practice, whether and to what extent this and other environmental provisions in the EU-MERCOSUR Trade Agreement will provide an adequately strong legal or political weapon for the EU to force MERCOSUR countries to comply with their NDCs under the Paris Agreement, remains to be seen. What is clear, however, is the urgent need to further integrate the objective of forest protection into other areas of international law.

While environmental objectives should not be used as a colonialist pretext to intervene in developing countries’ internal affairs, the depth of the current environmental crisis should lead to profound questions being asked concerning the fundamental premises of international law.

For example, lawyers and policymakers should rethink the concept of liability of states and companies that take domestic actions with important global consequences. The law should also be used by policymakers to help transform the conditions in which commodities are traded and the way in which cooperative schemes, such as REDD+, are implemented. Sustainable land management practices and more sustainable consumption patterns can also be further supported by legal norms, including by facilitating changes in dietary choices, as recommended by the Intergovernmental Panel on Climate Change in its recent report on climate change and land.

In other words, these developments are an urgent wake-up call for lawyers and policymakers in different fields to see the forest through the trees. Law should be put at the service of accelerating the transition to a new reality in which the business of protecting forests is economically, politically and socially promoted.

Posted on

Opinion 1/17 – the Investment Court System receives green light from the ECJ. But does it protect countries’ right to regulate mining projects?

Author: Pekka Niemelä, LL.D.. Post-doc, ClimaSlow-project

Introduction

In May 2019, the European Court of Justice (ECJ) issued Opinion 1/17 concerning the relationship between EU law and the so called investment protection rules of the Comprehensive Economic and Trade Agreement (CETA) between the EU and Canada. CETA’s investment protection rules seek to protect private investments made by Canadian and EU investors in the territory of the other party. Their central aspect is investor-state dispute settlement (ISDS), which allows investors to bring claims against, and seek compensation from, the state where they have invested. In addition to the CETA, ISDS has been included in more than 2 000 investment treaties, and it has been used in a number of high-profile cases by investors to challenge what many have perceived as legitimate public interest measures, such as Germany’s decision to phase-out nuclear power.[1] During CETA negotiations, a public campaign was led by NGOs, describing ISDS as putting ‘corporate profit before human rights and the environment’  and as being undemocratic and biased towards business interests.[2] Similarly, it was argued that the mere threat of ISDS risks compelling states to abstain from public interest regulation – a phenomenon known as ‘regulatory chill’.

The campaign succeeded in that the EU Commission amended its position, and rejected the inclusion of ISDS rules in CETA. The Commission replaced the much-criticized ad hoc arbitral tribunals and private arbitrators with a permanent investment court consisting of tenured judges. The Commission also introduced new investment protection rules, and, taken together, these changes were meant to ensure that investors are no longer able to challenge legitimate public interest measures.

Opinion 1/17 by the ECJ dealt, inter alia, with the question of whether CETA’s reformed investment rules comply with certain fundamental principles of EU law, such as its autonomy. In a nutshell, the Court held that CETA’s investment chapter is fully compatible with EU law. The purpose of this blog post is to challenge the contention that CETA’s investment chapter fully guarantees the protection of public interest measures from challenges by investors.

CETA and the Right to Regulate

According to CETA Article 8.9, the parties have a “right to regulate within their territories to achieve legitimate policy objectives.” CETA’s investment protection rules are also less investor-friendly than the standard ISDS rules in that they define more stringently the types of treatment that constitute a breach of the substantive investment protection rules. For example, CETA Article 8.10.2 provides that a treatment breaches the fair and equitable treatment standard only if it constitutes “denial of justice” or “fundamental breach of due process” or “manifest arbitrariness”. The “right to regulate” clause and the new protection rules were at the heart of Opinion 1/17, as the ECJ held that they guarantee that CETA “tribunals have no jurisdiction” to question democratically made decisions concerning the level of protection of public interests such as protection of the environment and public health. This would imply that when the EU member states and Canada adopt measures protecting these and other public interests, investors could not seek compensation under the CETA. This, however, most certainly is not the case.

Firstly, investment treaties have never prohibited states from regulating in the public interest, and in practice ISDS tribunals have acknowledged that states enjoy wide discretion in this regard. In most cases, the real question has been whether a measure genuinely served the purported public interest or whether it was adopted e.g. for political reasons and whether the measure was proportionate in relation to the protected interest or whether less intrusive regulation could have achieved the same goal. While CETA’s references to the “right to regulate” will undoubtedly guide the interpretation of the treaty’s investment protection rules, it seems obvious that there will nevertheless be situations where an investor will consider that a public interest measure constitutes “manifest arbitrariness” or that the process through which the measure was adopted entails a “fundamental breach of due process.” Indeed, most investment disputes are based on contested factual circumstances that are open to varied and opposing interpretations. What is a “fundamental breach” can only be assessed against some factual record, and many times reasonable people (including competent lawyers) will disagree whether the required threshold is reached. The point is not to say that CETA’s reformed rules are useless in protecting the public interest – they do diminish the tribunals’ interpretative leeway. At the same time, however, the CJEU’s take on the relationship between public interests and CETA’s investment chapter is unrealistic in assuming that ‘public interests’ are clearly definable and universally shared by domestic constituencies, rather than contested notions competing with other public and private interests in legislative and regulatory processes. In sum, CETA tribunals will not decline jurisdiction on the ground that a measure has been adopted with the objective of protecting a public interest, even if that public interest will be at the heart of the investment dispute and legal analysis. Indeed, most, if not all, EU and domestic regulations serve some public interest, and it is the task of CETA tribunals to assess whether the arguments about the measure’s purpose hold water and whether the measure complies with the CETA’s investment protection rules.

CETA and Mining in Finland

One question that has received attention in the context of CETA and Finland is whether Canadian mining companies could use CETA’s investment protection rules to seek compensation with respect to a mining-related regulation that affects their investments. Large-scale mining entails various ecological risks, so situations may well arise where regulators need to interfere with a mine’s operation when something unexpected happens or when assumptions concerning the mine’s environmental impact turn out to be too optimistic. While the permitting process for mining in Finland is governed by a number of laws, those laws do not dictate, for example, what should be done and who should bear the costs when a mine’s waste management fails to function as anticipated. These are difficult questions to which the applicable legal standards provide no clear answers. Should the mine’s operations be stopped? Who should pay for cleaning up the pollution and compensate the attendant damages?

When such questions are addressed in negotiations between the mining company and public authorities, the bargaining will effectively take place in the shadow of law. The possibility of bringing a claim against the state under an investment treaty adds leverage to the investor’s negotiating position for at least three reasons. First, investor-state disputes may carry a high price tag and the costs are paid from state budgets,[3] a picture that most politicians dislike, which increases the likelihood of settlement. Second, the uncertainties that relate to an underdeveloped area of law such as international investment law also create an incentive to settle, as the outcome of cases is often entirely uncertain. Even if the CETA seeks to rein in investor claims, it leaves much room for non-frivolous claims whose outcome is difficult to predict in the absence of relevant case law. Third, there is a widely shared perception among the political class that investor-state disputes damage a country’s reputation in the eyes of potential investors, and this may again tempt states to settle the dispute.

Conclusion

There is an ongoing discussion in Finland on the ways in which the Mining Act 621/2011 (and other laws relevant to mining projects) should be reformed so as to ensure that the impact of mining remains at an ecologically tolerable level. Whether or not such reforms are adopted, they cannot fully eliminate the possibility of mining-related disputes under CETA. While claims related to general, non-discriminatory legislative changes have little chance of success under CETA’s investment protection rules, the many uncertainties that relate to industrial mining may well create situations where regulators struggle to find a balance between the diverging economic and environmental interests, with the affected investors relying on CETA’s rules so as to take the dispute to an institutional context where investment protection remains a central premise despite the references to the right to regulate. 

[1] Vattenfall AB and others v. Federal Republic of Germany, ICSID Case No. ARB/12/12.

[2] See Pia Eberhardt and Cecilia Olivet, Profiting from Injustice (CEO, 2012), p. 7

[3] Under CETA’s investment chapter, the main rule is that the costs of the proceedings are borne by the losing party (see Art. 8.39.5). A 2014 study found that in ISDS cases where information on costs was available, the average amount for claimants was around US$ 4,437,000 and for respondents US$ 4,559,000, excluding arbitrator and administrative fees. The same study also found that average amount claimed in cases where the investor was succesful was around US$ 166 million and the median amount of damages awarded to investors around US$ 10.5 million. See Matthew Hodgson, ‘Counting the Costs of Investment Treaty Arbitration’, Global Arbitration Review (24 March, 2014),

Posted on

Exploring the limits of EU’s unbelievable behaviour on Nord Stream 2

Authors: Professor Kim Talus and Professor Leigh Hancher

In a letter dated 12 April 2019, Nord Stream 2 AG, a Swiss company owned by Russian Gazprom, informed the European Union (EU) that it is considering initiating investment dispute proceedings against the EU under the Energy Charter Treaty (ECT). 

In the notification, the investor indicated its wish to explore opportunities for an amicable settlement as provided for in Article 26(1) of the ECT – so that the parties explain their positions, negotiate and attempt to avoid a full-fledged investment dispute.  On expiry of the mandatory three-month period for negotiations, the investor can initiate a claim against the EU.  If this step is taken it would be the first time that a foreign investor has initiated an investment dispute against the EU itself as a party to the ECT.

This letter does not come as a surprise to those who have been following the ongoing Nord Stream 2 case. The notification makes reference to discriminatory treatment of Nord Stream 2 as an investment under the ECT. In addition, it would appear that the treatment of Nord Stream 2 by the EU and its Commission violates the fair and equitable treatment standard – a cornerstone of investor protection under the ECT. This standard seeks to ensure stable and predictable investment conditions, which includes protection of legitimate expectations and protection from retroactive changes to laws. 

The triggering event for a potential ECT claim is a new amendment to the EU Gas Market Directive of 2009.  This amendment extends the applicability of the EU gas market rules to external or ‘import’  pipelines that bring natural gas into the EU. Under the new rules, the applicability of the Gas Market Directive and all the other instruments of EU energy law, including network codes for gas, is extended to the territorial sea of the Member State where the first interconnection point is located. In practice this means that EU energy law applies to the Nord Stream 2 gas pipeline from the moment it enters German territorial waters. This will have negative economic consequences for the investor.  

Although the principle of extending the EU gas market rules to import pipelines may not in itself be discriminatory,  the terms of the legislative amendment appear to constitute unfair and unequitable treatment under the ECT. The amendment is drafted in such a way that all existing pipelines can enjoy a derogation from EU gas market rules under the new Article 49a of the Gas Market Directive. This derogation is, however, only available for pipelines that are ‘completed before the date of entry into force of this Directive’. The discriminatory treatment of Nord Stream 2 follows from the fact that it is the only import pipeline where the final investment decision has been made and significant capital committed, and so cannot benefit from the derogation.  

This is not an accidental outcome. It has been clear from an early stage that the only reason for the amendment to the current gas market rules is to target the Nord Stream 2 project. The various positions taken by EU and its Commission have been highly controversial. First, the Commission claimed that EU energy law already applied to offshore pipelines such as Nord Stream 2 even although it had never applied the gas market rules to such pipelines – including Nord Stream1. Once this claim was refuted by its own legal services, the Commission maintained that an intergovernmental agreement between EU and Russia was a legal necessity for the construction of Nord Stream 2, and the EU had the exclusive competence to draw this up.  This time the Council legal service shot down these claims and as a reaction, the Commission proposed the urgent enactment of the amendment to the EU Gas Market Directive of 2009. It is no surprise that the outcome is that these new rules are retrospectively applied to one single project: Nord Stream 2. 

A clear intention to discriminate against Nord Stream 2  goes a long way towards explaining why projects involving coal, the dirtiest fossil fuel, are protected from  negative economic consequences arising from the new capacity mechanism rules introduced in the Electricity Market Regulation 2019.  Commitments or contracts for coal fired capacity signed before the entry into force of the Directive are ‘grandfathered’. However, the new gas market rules apply to projects that have not been completed, irrespective of the date at which the final investment decision was made. The objective in both sets of rules is to protect investments but with important differences: for coal, ongoing arrangements and investments are covered by a derogation; while for gas, ongoing investments are not. Arguably, the timing of the final investment decision would have been just as a fair and practical cut-off point for gas pipelines. 

If the case continues beyond the current negotiations, it will be another important precedent for EU energy policy. The EU Energy Package case initiated by Russia in the World Trade Organization context raised certain concerns over discrimination against Russian natural gas. Given the peculiar treatment of Nord Stream 2 by the EU, such a claim would necessarily also pose questions as to the EU’s adherence to the rule of law.

Kim Talus, James McCulloch Chair in Energy Law and Director, Tulane Center for Energy Law, Tulane Law School; Professor of European Energy Law, UEF Law School; Professor of Energy Law, University of Helsinki. The author has provided legal advice to Nord Stream 2 AG.

Leigh Hancher, Professor of European Law, Tilburg; Part time Professor of EU Energy Law, Florence School of Regulation, European University Institute

This article was first published in www.euractiv.com (on 29.5.2019)

Posted on

Governing the Tipping Point: Global Chemicals and Waste Law at the Dawn of 2020

Author: Dr. Sabaa Ahmad Khan, Senior Researcher

Chemicals are the fundamental building blocks of the contemporary world, from a molecular to global level. Emergence of a chemicals market was one of the massive outgrowths, or aftermaths, of World War II. In the 1950s plastics began to enter the consumer market, driven by expansive marketing campaigns. Companies like Monsanto and Penn Salt developed full-page ads in magazines such as Time and Life, swaying consumers into the positive aspects of the chemicals industry. From doing laundry, to feeding children, to cleaning bathrooms and providing animal feed, the ease and comfort that the chemicals industry would bring to households was portrayed as boundless, futuristic. 

1947 Penn Salt Ad in Time Magazine, 1956 Monsanto Ad in Life Magazine

Today, the ubiquity of electronic waste pollution, abundant plastic debris in oceans, and chemically-polluted air in almost all regions of the world signal to us that our current global systems of production and consumption are rapidly deteriorating the ecosystem and human health; we are deep in the language of tipping points. As production systems have globalized, the transboundary flows of hazardous substances, materials and wastes that fuel our agricultural, pharmaceutical and manufacturing industries have become more difficult to map. In fact, many multinational firms producing everyday commodities are unable to trace their supply chains through to the core. Multiple levels of subcontracting cutting across several continents combined with legal protections over trade secrets make it difficult to know with certainty what exactly the commodities in expansive global consumption are made of, where they originated and what hazards they contain. International scientific bodies have often reminded us of how much we do not know about the chemicals we have come to rely on in every-day human life. From packaging in school and commercial cafeterias in every part of the world, to the seeds we feed livestock, humanity is entwined with toxic substances in ways we have yet to understand. Scientifically, at the very least, we know from observing the dispersion and transboundary flow of chemicals in physical space, that many of our chemical uses are detrimental to humans and the environment. 

It has become apparent that we are drifting farther away from fulfilling the global goal for chemicals and waste management established under Agenda 21 and crystallized in the Johannesburg Implementation Plan, that is, “to achieve, by 2020, that chemicals are used and produced in ways that lead to the minimization of significant adverse effects on human health and the environment.”  At the global level, a series of international chemicals and waste treaties have been adopted to protect human health and the environment from the global circulation of toxics, yet their coverage is narrow in scope and their controls are sporadic, limited to specific points of the chemical lifecycle. To fulfill the governance gaps of the international chemicals regime, the Strategic Approach to International Chemicals Management was adopted in 2006, operationalizing the 2020 goal through a voluntary and multistakeholder instrument, consisting of a series of overarching policy objectives and a Global Action Plan for implementation. Even with this progressive development of global law on chemicals and waste, chemical pollution remains a relentlessly rising planetary phenomenon that has proven impossible to address cogently under the existing cluster of international environmental agreements devised to regulate global flows of hazardous chemicals and wastes. In the complex system of global value chains and production networks, the attribution of responsibility and accountability for the toxic effects of chemicals and wastes on human and ecosystem health remain loosely defined and often impossible to allocate. 

On the eve of the next Conference of the Parties of the chemicals and waste treaties, and in the full thrust of negotiations towards a post-2020 global cooperative framework for chemicals and waste management, our imminent failure to achieve the longstanding 2020 goal provides anopportunity to revisit our collective vision and expectations of global chemicals and waste governance. More than ever, there is a pressing need to interrogate the further development of our body of international law on chemicals and waste from a Weeramantrian perspective, that is to say, with a particular emphasis on its ‘wisdom of the past’ and ‘attunement to the future.’ 

Can the global momentum over climate change invigorate us towards bolder commitments in eliminating the toxic, ubiquitous effects of chemicals and wastes, or towards a vigorous re-imagining of the philosophy of technology and paradigm of progress that underlies this field of international law? A first step in this regard may be to think about how we perceive the issue. While ‘chemicals and wastes’ have generally been considered an area for scientific specialists and a matter of technocratic management, in actuality they subsume almost all material goods that contemporary society has come to rely on. The toxic chemicals we face do not stand alone, they are embodied in products and in the global flow of these products as they travel through the phases of manufacturing, use, international trade, disposal and recycling. The legal visibility that is required to effectively protect human health and the environment from the toxic hazards  of chemicals and wastes must cut across entire global chains of production, consumption and reproduction. Moreover, the assignation of responsibility and accountability for how we produce, consume and dispose of commodities needs to spread across all stakeholders and across all continents. 

As governments, international organizations, industry actors and civil society groups convene over the next months to renew a collective vision for chemicals and wastes, the widespread human rights violations and rampant environmental destruction caused by chemical and waste pollution across the globe demand that they seriously reflect upon the international approach we have taken thus far, and consider further whether the toxic tipping points we face require a new lens, one that demands profound actions for transparency, responsibility and accountability across global commodity chains, and that speaks to government and society inclusively. The success of our efforts towards soundly managing chemicals and waste beyond 2020 will depend largely on how we raise global awareness of the human rights and ecological impacts of chemicals-based value chains, and of the transboundary causes and consequences of chemical pollution. Above all, there is a need to incite governments and society to care about chemicals from the molecular to global level, and to demand that responsibility and accountability for toxic substances be assumed across all globalized production systems and recycling chains, across all borders.A common-sense step that can be taken immediately is for countries that have banned the use of certain chemicals in their own jurisdictions to concomitantly prohibit within their jurisdictions the production of those chemicals for export. 

Given the continuous worsening of chemical pollution worldwide, a deeper interrogation of the global legal regime for chemicals and waste management is urgently required. In particular, understanding international chemicals and waste law from an environmental justice perspective, meaning, from the point of view of bridging ideas of law together with an understanding of the latter’s concrete impacts on space, equity and environmental and human health, is critical in order to bring an end to the historical, persistent, and wildly disproportionate impact of toxic chemical exposures experienced by the world’s most vulnerable workers, marginalized populations and fragile ecosystems.

Posted on

Delivery destinations and changing markets for liquefied natural gas

Author: Professor Kim Talus

Liquefied natural gas (LNG) markets are going through a rapid and fundamental change. Where the previous era for LNG deliveries was marked by point to point sales from an exporting country to an end-destination importing country, todays LNG world looks very different. 

The number of end-destination buyers and sellers has grown significantly: For long-term contract deliveries the markets have moved from six importing countries and three exporting countries in 1971 to 11 importing countries and 12 exporting countries in 2000 and in 2017 markets had reached 40 importing countries and 19 exporting countries. 

The growth of spot market players have grown in a similar fashion: from eight importers and six exporting countries in 2000 to 33 end markets and 29 exporting countries (including re-exports) in 2017. The market share of non-long-term deliveries (meaning spot and short-term contract deliveries) was 30% in 2017. While new long-term contracts are still signed, for new projects in particular, this share of non-long-term deliveries is rising. 

New types of market players have also emerged. In addition to the traditional sellers and end-destination buyers, various types of portfolio players have emerged. Also re-exportation has become more economical. Both the growth of trading parties as well as non-user sellers have contributed to the growing liquidity of the markets. 

These changes in the markets have put pressure on the traditional LNG sale and purchase agreements. Some of the changes seen in the markets include the agreements’ shortening duration; more frequent price revisions; moves away from oil price indexation of natural gas prices and increasing flexibility. 

These changes are primarily being driven by markets but for some are also influenced by  regulatory push. This includes the move away from destination clauses and other diversion clauses as well as profit-sharing mechanisms.  In this respect, the efforts by European Commission and Japanese Fair Trade Commission are particularly important. 

EU competition law investigations by European Commission focusing on various pipeline and LNG contracts and practices in early and mid-2000’s, and the more recent antitrust report by the Japan Fair Trade Commission (“JFTC”) in 2017 focusing on international LNG trade have reached partially similar conclusions. While the concerns of EU Commission were primarily related to liquidity of the EU internal gas markets and while the JFTC focused on free trade in LNG and liquidity of international LNG markets, it is possible to identify common elements and common concerns. 

In order to provide clarity and certainty for LNG market participants, a working group supported in the context of an ongoing projectinitiated by European Commission and Japanese Ministry for Economy, Trade and Industry, created a model diversion clause. The present author drafted the model clause, assisted by the other members of the expert group. The group believes that the model clause can meet the antitrust requirements of both Japan and European Union. 

The model clause presented and explained in this document is free for contractual parties to adapt as a part of their LNG SPA. While I and other members of the working group believe that this clause complies with antitrust requirements of EU and Japan today, care must be taken to ensure that future developments do not change the interpretation of these laws in a way that has an impact on this compliance. 

The model diversion clause and guidance note to accompany the model clause are available at: https://www.ogel.org/legal-and-regulatory-detail.asp?key=21040.

An academic article explaining the background is available at: https://www.ogel.org/journal-advance-publication-article.asp?key=575.

Kim Talus

Professor and McCulloch Chair in Energy Law
Director of Tulane Center for Energy Law
Tulane University

Professor of European Economic and Energy Law
UEF Law School
Co-Director for Center for Climate, Energy and Environmental Law
University of Eastern Finland (UEF)

Professor of Energy Law
University of Helsinki

Editor-in-Chief for OGEL (www.ogel.org)

Posted on

LNG: Developing the Demand

Author: Andrei Belyi

The International Maritime Organization (IMO) has introduced positive changes for LNG by cutting the amount of sulphur in marine transport from 2020. LNG will be the most logical fuel to replace high-sulphur fuel oil (HSFO): it will cut carbon dioxide emissions significantly.

From now on, the question is about commitment and compliance to these norms. The main caveat here is that ships are required to use lower sulphur fuels but refiners are not restrained by any regulation to supply heavier-but-cheaper solutions. Hence, ships will still have access to heavier fuels.

Adding to that, even though we have observed a number of ferry operators who have declared a shift to LNG, bunkering in the Mediterranean and Baltics appears to be moving more slowly than initially expected. Particularly, shipping and bunkering companies are concerned about LNG supplies and prices, whereas LNG suppliers would like to be sure of the mid-term demand for marine transport. There needs to be a faster rate of growth in the maritime transport sector in order to attract competitive LNG supplies. However, analysts remain divided about such prospects. A study recently produced by the Oxford Institute of Energy Studies points out that overall LNG demand in the maritime sector should not be overestimated. The shipping industry is not really rushing to switch over to LNG, even though we hear some announcements about companies switching to LNG for short-distance shipping: for example, liners in the Gulf of Finland.

Overall, I would believe that a further regulatory and legislative support at both national and European level might be needed to ensure the proper development of LNG markets, supplies and bunkering. Recently, Spain introduced a law obliging ship-owners to switch away from HSFO: it could be the right way to do for the other countries as well.

Adding to that, questions persist about methane. Methane actually constitutes a significant greenhouse gas emission produced during liquefaction and regasification, although the primary focus is often on the dioxide emitted by the final consumers – such as shipping companies. In this respect, a debate about “greening” the LNG will increasingly gain a place within policy communities. Mixing LNG with biogas-based liquefied gas would become one of the tangible solutions to the issue. Once again, technological mechanisms exist but a without the right regulations this development will be slow to come.

LNG shipment via containers has been increasing in recent years. Most innovative T75 Containers can for example be also used for short-term storage as the gas remains a liquid for 110 days and they can be used to ship LNG to filling stations. Rising use of compressed and liquefied natural gas in road transport certainly contributes to small-scale shipment of gas by containers.

It might be worth noting that LNG and CNG demand in inland transport seems to grow despite all the competition from electric vehicles. Across northern Europe, companies are increasingly investing in gas filling stations: in this regard, the latest news came from Gasum, announcing a plan to install up to 50 filling stations across Finland.

This text is an excerpt from Natural Gas World (https://www.naturalgasworld.com/ngw-magazine-lng-developing-the-demand-64692#snews)

Posted on

It’s the Politics, Stupid! How to Make Fossil Fuel Subsidy Reform Happen

Authors: Harro van Asselt  & Jakob Skovgaard

Fossil fuel subsidies strain public budgets and contribute to climate change and local air pollution. But despite widespread agreement about the benefits of reforming fossil fuel subsidies, repeated international commitments to eliminate them, and valiant reform efforts by some countries, they persist.

The scale of global subsidies is vast. For 2015, the International Monetary Fund (IMF) puts them at US$5.3 trillion. The International Energy Agency (IEA), following a more conservative definition of subsidies, estimates them at US$325 billion, still a substantial amount. Their sheer size means that reforming subsidies can lead to significant savings for the public purse.

Subsidy reform can also create important environmental and social benefits. A conservative estimate finds that a quarter of the Paris Agreement pledges can be met by phasing out fossil fuel subsidies. Moreover the re-purposing of fossil fuel subsidies, which are often socially regressive because they benefit the richer segments of society, can help the poor while reducing local air pollution and promoting renewable energy. Fossil fuel reform can thus contribute to achieving multiple Sustainable Development Goals (SDGs).

While some countries, such as India and Mexico, have undertaken successful reform, subsidies in other countries, such as Nigeria, have been rolled back due to public protests. Many other countries have not even attempted reform at all. Internationally, although SDG 12.c (on fossil fuel subsidy reform) and forums such as the G20 and the Asia-Pacific Economic Cooperation (APEC) have begun to offer platforms to address fossil fuel subsidies, other institutions such the UN Framework Convention on Climate Change (UNFCCC) and the World Trade Organization (WTO) have been conspicuously inactive.

What explains this discrepancy? In our new open access edited book titled ‘The Politics of Fossil Fuel Subsidies and Their Reform,’ we highlight the need to better understand the political dimensions of fossil fuel subsidies. Although economic factors such as fluctuating fossil fuel prices undoubtedly matter, they alone cannot explain why some countries have put in place fossil fuel subsidies, why they are maintained, and why in some cases they are successfully reformed. The prospects for fossil fuel subsidy reform are political, and the relevant actors, interests and cultures that inform these dynamics differ from country to country.

By studying fossil fuel subsidies as political phenomena, we can shed light on the factors that make reform work and identify how international institutions can help promote reform.

  • First, our work underscores the importance of clearly defining fossil fuel subsidies. Internationally, the IMF estimate of global subsidies is 16 times higher than that of the IEA because the Fund includes social and environmental externalities in its definition. From Trinidad and Tobago to the United Kingdom, the confusion about defining fossil fuel subsidies has allowed actors opposed to reform to argue that their country does not subsidize the consumption or production of fossil fuels.
  • Second, an analysis of the political dynamics reveals the role of wider power structures in enabling fossil fuel subsidy lock-in. In South Africa, for instance, subsidies to coal production have remained in place in the post-apartheid era due to their benefits for the powerful ‘minerals-energy complex’ of government, state-owned enterprises and industry.
  • Third, a focus on the politics of fossil fuel subsidies points to the critical role of framing. While, internationally, fossil fuel subsidies are considered primarily an environmental problem, national governments tend to implement fossil fuel subsidy reform for economic and fiscal reasons. Thus, if international institutions target fossil fuel subsidies solely as an environmental problem, they may miss many opportunities to mobilize domestic actors in favor of reform.
  • Fourth, timing is crucial. A better understanding of the politics can allow reform advocates to better identify political windows of opportunity. For example, in Egypt, President El-Sisi used the ‘honeymoon period’ following his 2014 landslide election to push through reform.

SDG 12.c has placed fossil fuel subsidy reform firmly on the global agenda, while rightly linking this commitment to broader environmental, development, economic and health considerations. To translate this imperative into action we need to improve our understanding of the political barriers to reform – and how they can be overcome.

This article was first published on the SDG Knowledge Hub:
 http://sdg.iisd.org/commentary/guest-articles/its-the-politics-stupid-how-to-make-fossil-fuel-subsidy-reform-happen/

Harro van Asselt, PhD (VU University Amsterdam, cum laude), is a Professor of Climate Law and Policy with the University of Eastern Finland Law School, and a Senior Research Fellow with the Stockholm Environment Institute.

Posted on

Environmental Cooperation under CETA- Bold New Linkages, Bolder Risks (5/10/18)

Dr Sabaa A. Khan is Senior Researcher at CCEEL / UEF Law School. Her areas of expertise include regional trade agreements and she serves on the Joint Public Advisory Committee of the Commission for Environmental Cooperation, under an appointment by Canada’s Minister of Environment and Climate Change. 

Dr Kati Kulovesi is Co-Director of CCEEL and Professor of International Law at the UEF Law School. She specializes in climate change law and holds a PhD in international economic law from the London School of Economics and Political Science.

The EU and Canada highlight climate change and the Paris Agreement in context of the CETA

In the same week as Canada, Mexico and the United States signed a new regional trade agreement that makes absolutely no mention of climate change, Canada and the EU made new efforts to formalize the climate change and trade linkage within the Canada-EU Comprehensive Economic and Trade Agreement (CETA). Representatives of the EU and Canada convened in Montréal for the inaugural meeting of the CETA Joint Committee, mandated to oversee and facilitate the implementation of all aspects of trade and investment under the CETA. 

The meeting’s outcomes included a recommendation on ‘trade, climate action and the Paris Agreement’, reiterating the Parties’ shared commitment to the international climate change regime and Article 24.12(1)(e) of the CETA that specifically addresses climate change. The recommendation further signals the Parties’ intention to “step up the role of the Paris Agreement in their bilateral cooperation”. 

This can be seen as a promising signal that the international climate change regime will play a salient role in shaping mega-regional trade flows. It is worth noting, however, that the increased trade in merchandise that has taken place under the first year of the CETA’s provisional application appears to be in sectors that are energy-intensive, and closely linked to the high-emissions extractive industries.

Graphical user interface, application Description automatically generated

Source: Government of Canada

Moreover, the Joint Committee’s reaffirmation of the Paris Agreement at this point in time is an environmental moment worth modest celebration in light of ongoing concerns regarding the potentially massive environmental implications of the CETA investment protection provisions and the legally-ambiguous investment tribunal established under Art. 8.27.

Will the CETA’s Investment Chapter Have a Negative Impact on Environmental Protection in the Finnish Mining Sector?

While Canada and the EU continually underscore the immense mutual benefit that the CETA brings to businesses and communities and its environmentally progressive nature, it is difficult to ignore that the greatest environmental impact of the CETA is likely to be determined by its Investment Chapter, not the Trade & Environment Chapter that is explicitly dedicated to environmental issues. 

The basic idea underlying the CETA’s Investment Chapter is to ensure that investors are treated equally and fairly, and that there is no discrimination between domestic and foreign investors. One of the mechanisms it includes for foreign investment protection is the possibility for investors to take legal action against governments through a new Investment Court System.  A critical apprehension in this respect is that the prospect of costly legal challenges and damage to a country’s reputation in hosting investment might discourage governments from taking legitimate and necessary regulatory and administrative actions to protect environmental and public interests. 

Even though the Investment Chapter reaffirms Parties’ regulatory right with regard to achieving legitimate policy objectives, including the protection of public health and the environment (Article 8.9), the provision on what constitutes a breach of fair and equitable treatment of investors (Article 8.10.4) leaves open the possibility for an investor to challenge governmental measures based on “legitimate expectations.”  In light of these provisions, there are valid concerns that the CETA’s profitable implications for Canadian and EU investors come at the expense of the Parties’ willingness to regulate in the public interest and according to the principle of sustainable development. 

In the context of the mining industry in particular – a key Canadian sector expected to benefit from the trade agreement – it is difficult to set aside the potential environmental and public health risks for EU Member states that are linked to the CETA’s investment protection rules and dispute settlement architecture. With over 50% of publicly-listed global exploration and mining companies headquartered in Canada, the CETA has not only opened up EU market access to a lucrative and globally powerful group of corporations, it has empowered them through the investment protection chapter to challenge public policy measures that interfere with their natural resource development projects. 

In Finland, the mining sector has been one of the key concerns in the context of the CETA. Past negative experiences, including from the Talvivaara mine, have increased the public’s awareness of the sector’s potential environmental impact. When approving the CETA, the Parliament requested the government to evaluate the need to reform the Finnish mining legislation in consideration of the CETA. In response, the government commissioned an expert report, which saw no need for reform.  The report’s key message is that the Finnish legal system already contains adequate protection to ensure investors’ fair and equitable treatment.  

This finding and the report have, however, generated controversy, not least because the report was commissioned from a law firm known for representing the interests of the mining sector and multinational mining companies.  One of the questions is whether the legal analysis in the report is objective enough to constitute a response to the Parliament’s request. 

Looking at the report commissioned by the Finnish government, it contains comprehensive and well-informed analysis of the Finnish national legislation. However, the international law dimension would have merited more attention. This would have included analyzing relevant case law to understand what kind of government actions have been challenged through investor-state dispute settlement. Such analysis should have studied at least case law involving the mining sector and Canadian mining companies.  

Looking at investor-state dispute settlement, Canadian mining companies already have an extensive track record in seeking financial compensation from governments through arbitral disputes. The request for arbitration filed at the International Center for Settlement of Investment Disputes (ICSID) by Toronto-listed Gabriel Resources against Romania, seeking $4.4 billion for alleged losses in its halted gold-mining project, and the dispute between Vancouver-based Eldorado Gold and Greece (ruled in favor of Eldorado Gold) over the environmental impacts of mine development in the northern region of Halkidiki, are reflective of the kind of mining disputes that could proliferate under the CETA.

In the Gabriel Resources vs. Romania case, the mining company is basing its claimon “unjustified delays in the administrative permitting process, imposing shifting and non-transparent legal requirements,politicizing applicable legal and administrative processes, and ultimately abdicating the responsibility to make decisions on the permitting of the Project in contravention of the applicable legal framework.” In Eldorado Gold vs Greece the claimant’s argument also concerned, inter alia, delays over issuing environmental permits. 

A quick glance at the relevant case law thus shows that legal arguments made in the actual proceedings tend to be more complex than those studied in the expert report commissioned by the Finnish government.  It would therefore have been useful to also study the actual case law and consider its relevance in the Finnish context. Whether this would have affected the overall conclusion remains unknown without comprehensive analysis. 

Overall, the concern remains over the CETA’s Investment Chapter risking to immobilize EU Member states’ from regulating in the interest of public and environmental health protection. Of course, Canada could face similar challenges brought on by EU investment in Canada-based mining operations. Since the Investment Chapter has not been implemented under the provisional application, and the CETA itself has yet to be fully ratified, there is still space for EU Member states to bring in mining legislation reforms to counteract the possible financial, environmental and public health risks associated with the expansion of Canadian mining interests in the EU.

Posted on

Doughnut Law – Environmental Law for the Anthropocene? (3/7/18)

Niko Soininen

Niko Soininen currently works as a Postdoctoral Researcher in Ocean Governance Law at University of Gothenburg and Senior Lecturer in Environmental law and Jurisprudence at UEF Law School/CCEEL. In the fall of 2018, Soininen will start as an Assistant Professor (sustainable law, governance and regulation) at University of Helsinki.

Anthropocene is the scientific term for a geological time-period acknowledging the fundamental human impact on the Earth’s ecosystems. With global impact come questions of planetary boundaries: How much human impact is too much human impact? The Stockholm Resilience Centre’s study on planetary boundaries shows that we are currently well beyond safe nitrogen and phosphorus output levels. Also, biosphere integrity, especially the loss of genetic diversity, poses a high risk for humanity. Climate change and land-use are currently reported as causing increasing risks. At present, freshwater use lacks a quantified planetary boundary but freshwaters are heavily impacted by the above environmental changes. This is a bleak picture, but not all is lost. I spent four months in the spring of 2018 at the University of Maryland Socio-Environmental Synthesis Center as an ASLA-Fulbright visiting scholar studying adaptive governance. In the following, I’ll recap some of the most salient lessons from the adaptive governance scholarship seeking to design effective and legitimate environmental governance for the Anthropocene.

FROM DOUGHNUT ECONOMICS TO DOUGHNUT LAW

With the global economic system being a major driver in pushing the planetary boundaries, Kate Raworth presents an interesting theory for rethinking economics (Doughnut Economics. Seven Ways to Think Like a 21st Century Economist. Chelsea Green Publishing 2017). She makes a compelling argument for moving away from antiquated pictures of steadily climbing economic growth toward doughnut shape economics. The economic doughnut builds on “a pair of concentric rings”. The inner ring depicts the social foundation of human well-being and the outer ring the ecological boundaries of our planet. All human activity must remain within the doughnut’s two rings. With this picture in mind, Raworth asks us to consider “what economic mindset will give us the best chance of getting there?”

The question of getting the economic system to nourish social well-being while respecting planetary boundaries is not only important for economics, but also for law. In a legal context, the question reads: what legal mindset will give us the best chance of getting there? Applying Raworth’s question to law, we enter a familiar territory for adaptive law and governance scholarship. What does doughnut law and governance look like? What kind of law and governance is needed to stay within safe operating space for humanity? Analogically to the doughnut economy questioning existing economic theories, the adaptive law and governance theories question existing legal theories.

FOUR DOUGHNUT-LESSONS FOR LAW

The first doughnut lesson for law and governance in the Anthropocene is to regulate the use and protection of ecosystems at a systemic level (see a good overview, Benson & Craig 2017; Garmestani & Benson 2013). Traditionally, law has turned a blind eye to regulating cumulative human impacts on ecosystems. This is visible, among others, in the fragmentation of environmental management authority into several sectors at all levels of governance (energy, transportation, food production, natural resources, nature conservation etc.). The limitations of sectoral competence are often aggravated by management and regulatory authorities having limited geographical, and often artificial (non-ecosystem-based), competences. Staying within the doughnut, however, requires law and governance that is equipped with competence equivalent to the nature of the environmental problem at hand. Wicked problems such as climate change, nutrient run-offs and biodiversity loss require a systemic cross-sectoral and multi-level approach to law and governance.

The second doughnut lesson is to recognise that managing (what do we do?) and governing (what do we want?) the use and protection of ecosystems needs to be adaptive. As Craig & Ruhl (2014) and Cosens et al. (2017) have repeatedly observed, procedural and substantive rules need to facilitate the consideration of changing social-ecological circumstances. Traditionally, law has often been used to establish predictable rules that operate acontextually and do not allow consideration of changed ecological, social, economic, technological and cultural circumstances. In Finland, this approach is well illustrated in government issued hydropower licenses that are legally protected against revocation, and in certain instances the law does not even allow changes to existing licenses. This picture of the law as guaranteeing predictability and finality faces significant challenges in the Anthropocene as ecosystems and social systems dependent on them are dynamic entities (complex adaptive systems) with immensely complicated functions, feed-back loops and non-linear tipping-points. For this reason, law needs to allow adaptive and experimental management of social ecological systems and be able to adapt its own rules for maintaining human activity within the doughnut.

The third doughnut lesson is based on an understanding that people and companies do not like to be regulated. They may, however, still wish to advance accepted societal goals and may be very well-equipped to do so. The wrong picture is to think that law is the only policy instrument that really works. If we look at climate change mitigation, this is certainly not true. A study done by Vandenberg & Gilligan (2017) shows that companies like Walmart hold significant power to push environmental policy goals through their subcontractor networks. Law (or public governance in general) is not always the most effective way to steer human activities within the doughnut.

The fourth and final doughnut lesson is that law and governance need to be science based (see e.g. Benson & Craig 2017; Saunders et al. 2017). We need constant monitoring of social and ecological systems to understand how they function, have functioned and will be likely to function. Systemic governance is not possible without science, nor is adaptive management or governance.

With the above four lessons in mind, environmental law and governance will be much more equipped to stay within the social-ecological doughnut than ever before. The million-dollar question is, however, whether the international community, regional actors such as the EU and states have the courage and the political will to move towards more adaptive law and governance. While some encouraging regulatory examples are visible on all governance levels, the push-back of antiquated legal mindsets still linger in the air.

Posted on

Boosting the EU’s circular economy plans by addressing links between chemicals, products and waste legislation (23/4/18)

Topi Turunen

Topi Turunen is a PhD researcher in environmental law at CCEEL / UEF Law School and a Researcher at the Finnish Environment Institute. 

The European Union (EU) is seeking to make the European economy more sustainable through its Circular Economy Action Plan. The interface between chemical, products and waste legislation presents some complex challenges for the objectives of the circular economy package. In January 2018, the European Commission published a communication and staff working document on options to address linkages between three key pieces of EU law, namely the Waste Framework Directive, Regulation on Classification, Labelling and Packaging of Substances (CLP) and the REACH regulation.

Four key challenges

There are four key challenges in the interface between chemicals, products and waste legislation that the communication seeks to address. The first is that waste management operators often do not have adequate information on the presence of substances of concern. This makes controlling the life-cycle of certain chemicals complicated. Information on the composition of materials is available in the supply chain in accordance with chemicals legislation. However, when a material becomes waste, waste treatment operators are not considered to be a part of the supply chain and the information on the material’s composition is therefore not made available to them. Under chemicals regulation, operators recovering chemicals from waste are considered as manufacturers and as starting a new supply chain for the substance in question. The recovered substances will have to be either registered as any new substances; or registered as UVCB substances (i.e. substances of Unknown or Variable Composition, Complex Reaction Products and Biological Material); or the composition of the material has to be identified through the safety data dossier of similar substance that has already been registered in the case of recovery exemption. Hence the identification of the composition of the waste-based materials according to REACH cannot be by-passed in recovery although REACH explicitly does not apply to material when they are still considered ‘waste’. The administrative costs to fulfill obligations of REACH can be high and it has been pointed out that the supervision of recovery exemptions tends to have loopholes.

The second challenge relates to the question of whether the recovery of so-called ‘legacy substances’ (substances that are commonly present in products but that have been prohibited or restricted in new products) should be promoted in order to increase the overall recovery of wastes. Waste streams containing legacy substances can be huge in volume and their recovery can therefore have a substantial impact on the achievement of circular economy objective for more efficient material circulation. Nevertheless, it remains unclear whether the risks of using such wastes can be balanced through the positive environmental impacts of their recovery from the waste stream.

The third challenge is that the regulation of End-of-Waste criteria is not fully harmonised within the EU and it is therefore not always clear when a product or substance ceases to be waste. The Commission is therefore proposing a more harmonized EU-wide regulation of different waste streams ceasing to be waste and more uniform rules for the End-of-Waste schemes in the EU Member States.

The fourth key challenge relates to some discrepancies in waste and chemicals regulation: hazardous waste is not always considered hazardous as a chemical according to the CLP Regulation after it has gone through a recovery process and ceased to be waste. Moreover, hazardous chemicals are not necessarily considered hazardous waste after being discarded.

Thoughts on the way forward

Solving the four key challenges will be complicated. What will be required is either new legislation or significant amendments to the existing legal framework. Possible measures include abolishing the recovery exemptions system, redefining the scope of supply chains and expanding the scope of extended producer responsibility schemes. The downside of abolishing the recovery exemptions system would be increased administrative burdens that risks creating a disincentive for recovery. On the positive side, this would result in safer material cycles and reduce the possible negative impacts of wastes by improving the monitoring of chemical substances in waste recovery. Redefining the supply chains and strengthening the extended producer responsibility both emphasise the crucial role of manufacturers and importers: the life-cycle of the product and its properties have to be taken into account in order to reach the objective of effective and safe material cycles. The distinction between waste and products could also be clarified with more harmonized EU-wide End-of-Waste regulations and clearer criteria for when an object or substance ceases to be waste. Finland has taken initial steps towards improving the quality of its End-of-Waste regulation by starting to draft national end-of-waste legislation and a guidance to support case-by-case decision-making.

Once waste ceases to be waste, it will be subject to the same regulatory framework as similar non-waste products. Therefore the acceptance of legacy substances in recovered materials seems unlikely and it seems more likely that their use in products will remain unlawful. A further argument in support for the proposed approach is that the evaluation of trade-offs between the positive impacts of recovery and the negative impacts of using legacy substances would most likely prove to be extremely complicated and expensive.

Coming back to the Commission’s recent proposal, a final aspect worth noting is that the proposal does not create any obligations for stakeholders. The Commission however proclaims that it will start multiple research projects and aims to work with relevant stakeholders and European Chemicals Agency (ECHA) in order to solve the above-mentioned problems. This process should be well under way by the time the current Commission’s term comes to a close at the end of 2019.

This blog post is based on the following article, published in the Finnish Journal of Environmental Law:

Turunen, Topi: Kemikaali-, tuote- ja jätesääntelyn rajapinnan ongelmakohdat – kommentteja komission tiedonannosta keskinäisistä yhteyksistä. Ympäristöjuridiikka 1/2018, pp. 44–60.

Posted on

The role of law in securing resilience of water, energy and food systems

Kaisa Huhta, Antti Belinskij and Niko Soininen

Climate change, population growth and economic and technological development are significant challenges for natural resources management. Governing limited resources requires that the interlinkages between natural resource sectors are adequately acknowledged and addressed.

Such interlinkages are particularly clear between the water, energy and food sectors. Agriculture is the largest consumer of global freshwater. Water is also needed, for example, in the production of hydropower and biofuels and in the operation of solar panels. Energy is needed to ensure food production and water services, but some forms of energy production may also decrease land available for agriculture. Hence, decisions concerning one of these sectors do impact the functioning of others.

Resilience refers to the ability of a system to adequately prepare for, and to recover from, shocks without losing its capacity to function.[1] It is particularly important for sectors such as water, energy and food. This is because, first, the uninterrupted availability of and access to these resources is irreplaceable to any society. Second, the potential butterfly effects between these sectors further emphasise the importance of safeguarding the functioning of water, energy and food systems.

Resilience has a legal dimension. Law can either improve or impede the ability of a system to withstand disturbances and shocks. So how do we recognise a legal framework that improves the resilience of the water-energy-food nexus? First and foremost, the legal framework should adequately acknowledge the vulnerabilities of water, energy and food systems. Secondly, it should recognise interlinkages between these sectors in such a way that prevents a shock in one sector from paralysing the functioning of the others. Finally, a functional and effective legal framework should tackle the different time scales on which the water-energy-food security nexus operates. This means that a legal framework should be equipped to respond to sudden short-term disturbances as well as facilitate the long-term security in these sectors.

What is also needed is an adequate institutional and jurisdictional setup for co-operation and co-management of the sectors. For example, law governing electricity supply should acknowledge that a disruption will eventually affect food and water supply as well. Furthermore, law should not only facilitate responses to sudden shocks but also include tools to prevent such shocks in the longer term. In the water sector, for example, this would mean clear obligations concerning the investments needed to maintain functioning infrastructures.

The role of law in establishing and maintaining resilient water, energy and food systems is important but challenging. In an ideal situation, law supports and enhances the resilience of these sectors. However, law can also have the opposite effect if it emphasises predictability in a way that hinders adaptive reactions in shock situations. For example, rigid and static procedural rules may impede flexible and fast reactions to shock situations even if these rules are generally favourable to ensuring legal predictability and non-discriminatory practices. Furthermore, the societal, technical, economic and scientific uncertainties relating to the interlinkages between water, energy and food sectors make it challenging to balance predictability on the one hand and resilience of water, food and energy systems on the other. Nevertheless, the ability of law to maintain the resilience of these systems is a central element in safeguarding the water, energy and food security.

* The blog post is based on two recent articles supported by the Strategic Research Council’s Winland project (No 303628). The articles are:

  • Antti Belinskij, Niko Soininen and Kaisa Huhta, ‘Vesi-, ruoka- ja energiaturvallisuuden oikeudellinen resilienssi’ Ympäristöpolitiikan ja -oikeuden vuosikirja (2017)
  • Antti Belinskij, Kaisa Huhta, Outi Ratamäki and Marko Keskinen, ’International Law and the Water-Energy-Food Security Nexus’ in Peter Saundry (ed.) Food-Energy-Water Nexus (forthcoming 2018).

[1] Walker, Brian, Gunderson, Lance, Kinzig, Ann, Folke, Carl, Carpenter, Steve and Schultz, Lisen, ‘A Handful of Heuristics and Some Propositions for Understanding Resilience in Social-Ecological Systems’, 11 Ecology & Society (2006), p. 14.

Posted on

Why multilateralism matters?

Moritz Wüstenberg

Junior Researcher, Energy Law

Liberal trade has faced growing resentment from several directions in recent years. The decision by the United Kingdom to withdraw from the European Union following a 2016 referendum has affected both businesses and individuals. On the other side of the Atlantic, the 2016 election of President Trump was built on a campaign of protectionism and threats to multilateral trading rules. Disrupting the international trading system in order to realise an “America first” policy or to cast of the shackles of the European Union raise concerns and questions. In addition to creating economic benefits, trade on multilateral terms has for centuries been recognized as a key tool for maintaining peaceful relations between nations. If multilateralism fails, how will this impact geopolitics? Some exceptions, such as those allowing for closer cooperation without infringing on the multilateral rights, are sanctioned by the multilateral rules of the WTO and their use is on the rise. Is an increase in the use of exceptions to multilateralism a cause for concern?

The reduction of tariffs has been achieved through several rounds of negotiations under auspices of the General Agreement on Tariffs and Trade (GATT) in the wake of the Second World War. The outcome these means that trade in goods today is nearly tariff free. A key ingredient for the success of the GATT negotiations was the Most-Favoured Nation (MFN) clause, through which tariff concessions negotiated between some Members were multilateralized to all on a non-discriminator basis. In tandem with trade liberalization the global economy witnessed rapid growth of income, creating wealth for those taking part in the process. The driver of this growth has been argued to have been the virtuous cycle in which tariff cuts led to increased trade, which in turn led to more income which yet again enabled tariff cuts. Today, the MFN clause remains a cornerstone of the World Trade Organization Agreements (WTO) with only few exceptions to it.

Preferential Trade Agreements, such as the European Union, NAFTA or the CETA, that offer deeper liberalization to its Members, but do not raise tariffs or other barriers to trade vis-à-vis those WTO Members that are not part of the pact, form the most important exception to the MFN obligation. In general, the preconditions for deviations from the MFN principle are threefold: transparency (the requirement to notify), commitment to regional trade liberalization (the requirement that PTA´s cover all trade between parties) and neutrality in relation to non-parties. The number of PTA´s has grown rapidly in the past decades, leading to concerns on the erosion of multilateralism. This echoes also the broader discussion on the fragmentation of international law, ongoing for more than a century.

The positive economic effects that can be achieved through liberal trading policies have been evident in both Great Britain in the 19th century as well as the United State in the 20th century. The repeal of the Corn Laws in 1846 ended a period of mercantilism in place since 1815 and pushed Great Britain into prosperity by embracing free trade, even on unilateral terms. The underlying theory was and remains that gains can be made by specializing in the production of certain products and then exchanging these for products that others produced efficiently. Free trade would eventually lead to an efficient outcome as nations produced those goods which they could produce most efficiently. With its bet on free trade, Great Britain would be the leading economic power of the 19th century.

Successful post-war settlements, at least since the 1648 Peace of Westphalia, have specifically recognized the relevance liberal trade has for the maintenance of peaceful relations. Are the mostly peaceful relations since the Second World War under threat from the rattling of trade sabres? While it is unlikely that neither the protectionist policies of the United States or the withdrawal of the United Kingdom from the EU will have any imminent effect on peaceful relations between nations, the stakes are high. Throughout recent history, liberal trade has functioned as an assurance against armed conflict and, conversely protectionism has preluded conflict.

A recent investigation on the effect of aluminium and steel imports (Section 232 investigation) on the US economy concluded that these have a negative effect on the National Security and can therefore be “adjusted”. Against a backdrop of several options to protect the domestic industries, President Trump chose to raise duties on imports from all countries including Canada and the European Union. Calls for retaliation were immediate, reflecting the conception that the measures of the United States are unjustified.

National Security exceptions are found in most trade agreements, including the WTO agreements. The US seems to have prepared to make use of this exception by broadening the traditional interpretation of national security beyond national defence to include also economic security in the aluminium and steel investigation. The apparent reason behind this interpretation is an attempt to rely on a little used MFN exception of the GATT (Article XXI) that allows WTO Members to take `any action which it considers necessary for the protection of its essential security interests`. While there are qualifications for the use of Article XXI, it is in effect self-judging it suffices that the measures taken are considered necessary by the state taking them. Invoking this article without due cause could be the straw that breaks the camel´s back, undermining the effectiveness of the multilateral framework and causing other nations to retaliate by also invoking Article XXI to justify their trade restrictive measures.

The “political trilemma” is how the economist Dani Rodrik has described the problem facing international economic integration. Nations have to make a choice between two of three lines of policy: international economic integration, the nation-state and mass politics. Should international economic integration be maintained, either the nation-state or mass politics have to be sacrificed. With both America and the United Kingdom choosing the nation-state and mass politics over integration, only time will tell if history will repeat itself with trade protectionism flowing into geopolitical tensions.

Deeper commitment to free trade without diminishing the rights of WTO Members is at the core of the Preferential Trade Agreement exceptions to MFN treatment. Negotiation with fewer nations enables faster decision making and makes it possible to overcome the foot-dragger effect which the consensus based rules of the WTO can have. Consequently, PTA can be seen as a building block as opposed to a stumbling block for multilateralism. Moves toward unilateralism as witnessed in the US aluminium and steel investigation, on the other hand can be considered conflicting with multilateralism. It remains to be seen if trade-politics convert to geo-politics and, more ominously, trade wars morph into real wars.

This blog is based on the author’s recent publication ´Back to the future: MFN treatment in an era of protectionism´ in the Nordic Journal of International Law. This publication reviews the development of the Most-Favoured Nation clause in light of historical events and analyses its importance in trading relations today.