Press Conference
Todd Stern
Special Envoy for Climate Change
Deputy Special Envoy for Climate Change Jonathan Pershing
Washington, DC
May 29, 2009

Special Envoy Stern: Hi everybody. This is Special Envoy Stern. I know I saw some of you last week in Paris and I appreciate you for covering the second preparatory session of our major economies forum.

Deputy Special Envoy Pershing, my Deputy is joining me today. He's going to be leading our delegation (to) Bonn and he'll brief on the bond issues for this call. So questions on Bonn will go to him.

Let me just make a few short points. Through concrete actions, the Obama Administration has solidified its commitment to combating climate change. And really we have made and the President has made and announced an enormous change in U.S. policy. I would point out that the Administration's proposed effort on climate change going forward is roughly equal to what is being proposed by the EU.

The Waxman-Markey legislation, which is making good progress, it passed through the Energy and Commerce Committee last week, represents a very important step forward. The bill would establish caps of 17% below 2005 in 2020 going all the way up to 84% below 2005 in 2050. And that's not a long term goal, it's not an aspirational goal, it's hard mandatory policy that we're talking about with a cap that gets progressively tightened year by year starting in about 2012 when it would take effect, all the way out to 2020, 2025, et cetera, all the way to 2050.

And by the way, some of the - you can see the progression of it as you look at the projected numbers to 2025, which is about a 30% cut and 2030 would be about a 42% cut off of 2005. By the way, it would be about a 33% cutoff as compared to 1990.

In addition, starting the Administration, the President's first focus, of course, was on getting the economy going with a very large stimulus package. And somewhere in the order of $60 billion to $70 billion of that package was directed to clean energy investment, which is a huge amount in this area.

And the President's budget also calls for $150 billion of research development and deployment funding for clean energy, including wind, solar, geothermal, et cetera over a ten year period.

At $15 billion a year for ten years, that would be about three or four times more than the U.S. currently puts into R&D or has put into R&D up until the President came into office.

In addition, about - where are we - about a week and a half ago, the President announced a new policy on tailpipe emission standards for cars, which would represent - which does represent a very significant increase over anything that has happened before in the U.S. It would increase average fuel economy up to 35-1/2 miles per gallon in 2016, way beyond what has happened before.

And this isn't proposed legislation; this is actual policy that the President is able to do through executive action through the EPA.

Negotiations going forward are going to be challenging; we know that. We've got a long way to go to get to Copenhagen, but I think the meetings we've had in the major economies forum including both Washington and Paris have been quite constructive, have been I think forums where people have not entirely, but to a significant degree put away talking points and tried to focus on how we can find common ground. And we will be continuing that work going forward in this time between preparatory sessions, between the Paris meeting that just ended and the next meeting that is going to occur June 22 and 23 in Mexico City.

So, anyway that's kind of the quick update. And let me turn things over right now to Deputy Special Envoy Pershing.

Deputy Special Envoy Pershing: Hi everyone. This is Deputy Special Envoy Pershing. I'm just going to give you a few short comments on Bonn and the climate change negotiating process and we're both happy to take questions.

As you probably all are following it in some detail, I (don't have to) give you a lot of new information here. But just to be clear, the Bonn negotiation that we're about to have is the next in a series of meetings that are being held in preparation for Copenhagen, which is coming up at the end of the calendar year, December in Denmark.

This is the first time that we're actually going to begin negotiating on text. Up until this point we've been working on general ideas, views and visions of countries but prior to this meeting, countries had made a series of formal submissions to the Climate Change Convention Secretariat and Michael Zammit Cutajar, who is the Chair of the negotiations for the working group that's doing this part of the process has compiled them into a single document which seeks to outline what he thinks might be areas for agreement that we carry forward.

So the session in Bonn will be very heavily focused on that particular piece of paper and countries will begin to add issues they think are critical, new areas they think were not particularly well covered and begin to express concerns on issues they think are not appropriate, they don't want to have in the final outcome.

So this session will really be a process of evaluating those and beginning to try to develop a text that we can come to some agreement on.

The United States going to this meeting made its own submission. We focused on a couple of key areas. We focused on the need to have long term plans for all countries. We need to think about this process not just as a five year agenda, but as a agenda that carries us forward into the longer term where emissions really have to be reduced substantially in order to meet the needs of the science and to reduce the threats of greenhouse gas emissions and climate change.

In that context, we're proposing that countries work on domestic actions, that all countries work on domestic actions, that they be in the context of national circumstances and that they be consistent with capacities and responsibilities. We on our side, Special Envoy Sterndescribed some things that we're beginning to do, some of the commitments that we've made domestically. We look forward to similar kinds of efforts from others as we take this forward.

This meeting - and let me just conclude with this - this meeting will not be an easy meeting. It'll be a meeting where people begin to express the hard differences and try to work out how they can find common ground.

I don't think there will be a lot of news out of it. I think most of the issues that you will have heard will be things that will be reprised from other previous interventions that countries have made, from statements they've made. We're very early in the process. We go from here to a meeting in August and then from August to a meeting in October and then from October to a meeting in November, all before we get to the November session - the December session in Copenhagen. This is an (unfolding) process; this is the beginning of an effort to work on text, not the end of something where you can see new emerging details and clarification. So.

Question: Good morning and thank you very much for organizing this teleconference. My question is this, will you be - you've talked a lot about the big changes which are being put forward by the Obama Administration when it comes to energy and climate change. And you've spelt out really quite emphatically these policies on clean energy investment, tailpipe emissions and so on and at the same time, you made quite clear that you're doing pretty much the maximum which can be expected with regard to the American domestic politics, you can't go beyond this 17% reduction.

My question is this, will you be asking that these policies which are being spelt out on clean energy investment, on tailpipe emissions, that these be included retroactively as part of the American position, as part of the American package in the UN negotiations?

Special Envoy Stern: This is Special Envoy Stern. I'm not sure what you mean by included retroactively. I mean I think that all of the policies that combine to make up our overall approach to climate change and clean energy will to some extent inform and underpin our position in Copenhagen and what we're trying to do and so I think they're important and they will be reflected. And maybe I may be missing the - you may have something that you mean in your question that I'm not quite getting, but they will - but all of those policies will be part of our position.

Question: Well, just to follow up on that if I may, it's basically, you said the other day in Paris that that there's no point going from this position of where you compare, you know, a 20% cut (or do you feel the) Europeans over by - compared with 1990, compared with a 4% cut by the United States that you found out there's a more flexible way of arranging this. And at the same time you seem to point to a kind of a variable geometry whereby other efforts are taken into account.

And I just wondered if these policies which you (spoken now), which in fact have a big impact on climate change, if that would be part of the haggling, if that would be part of your negotiation stance, if you would want to say, take these into account, that must be factored into what we're putting forward along with our emissions cuts.

Special Envoy Stern: Well, I guess I would say, not exactly the way that you've described it. I mean certainly I think it's important to look at policies that will make an actual difference in reducing emissions and not necessarily arguing that those policies would increase the overall number that would be part of the cap and trade scheme. If they did then we would seek to underscore that. But I think that - I don't think it's self evident that they would.

And with respect to - in other words, they might be incorporated in effect within the overall number that would be achieved in U.S. policy. But I - you said, and you just were referring to what I said in Paris as making a comment about looking at 4% below 1990 in more flexible terms. I don't mean to be saying, in more flexible terms. What I'm saying is if you look at what we are doing in light of what we are doing going forward, in light of what President Obama could possibly be doing because President Obama wasn't president back earlier, if you look at what we are proposing to do on a going forward basis, it is enormously ambitious and probably the equal of anything that the EU is proposing or at least quite close to that.

I mean, my guess is that, you know, it's 17% below 2005 right now. My guess is, you know, if the legislation were to take effect actually in 2012 and we're talking about this 20 - in essence 2013 to 2020 period - I don't know what the exact numbers would be. My guess it would be probably 19% or 20% reduction compared to, you know, to the point when it was actually taking effect.

So, it only looks - and one of the things that I think is - does not actually serve your readers entirely well is if you only talk about these things as compared to a historical baseline which then presents to the reader that the Europeans are proposing to do 20% or 30% and the United States is preparing to do - proposing to do 4%, it's quite misleading as compared to - because the issue really, the critical issue is what are we doing going forward. And there the U.S., what the U.S. is proposing is really very, very robust.

Question: Thank you.

Question: Oh, hello. Thanks very much for doing this. I'd like to go back please to the issue that was raised in Paris by the French Minister, the idea of a common goal that the industrialized countries together could guarantee a cut of emissions to the 30% below 1990 levels by 2020.

How could that work out? Presumably if the United States cuts to 4% below 1990 levels then you might be left with other things to do. Is that feasible thing that for example, the United States would take over a larger share of financing for -(I don't know if it's) to help other countries with carbon capture and storage or new technologies, research and development into green technologies, that sort of thing. Is that a sort of possibility?

Special Envoy Stern: No. I mean that's not the way we're envisioning it. I mean we are quite willing to - and not just willing, but have been engaged in conversations with our European friends with respect to how you might express the - an aggregate kind of goal. I mean the most important - kind of the core focus I think is certainly on what each country is going to do because what each country is going to do is what - is the, you know, the undertaking that's actually - that is mandatory for that country.

But we don't - we're quite open to the notion of kind of rounding up the developed countries and putting - expressing what's going to be done in a - what they're proposing to do in an aggregate fashion if that works.

But it's - you know, again, I don't want to bore people with all of the technicalities of looking at numbers in the context of different baselines or different target years. There are ways in which you could actually imagine having an aggregate number expressed where there's a good deal of similarity in the numbers that are being proposed and there's ways in which that's harder. And a 1990 baseline - an aggregate number that envisions a target by 2020 with a 1990 baseline for the reasons that you just stated in your question is harder because there is that bigger gap when you express things against 1990.

But - and so I think the notion of a 30% aggregate number by 1990, not going to happen. But you might express an aggregate number that would be lower than that but then ramping up quite quickly over time to 2025, 2030 and the like.

Question: Yes. Can I just follow up on that? So the idea of the IPCC's recommendation of 25% to 40% below 1990 isn't going to happen.

Special Envoy Stern: Look, the U.S. - we are working hard right now on the putting forward the proposals that we have made. As I just discussed, as you just repeated in your question, the Waxman Legislation expressed against 1990 is about 4%, 17% against 2005. I don't think that it's - I don't think you're going to see a 25% to 40% aggregate number by 1990, although it's possible when you add everything up that you won't be that far away from it. But I don't think you're going to get all the way up there.

Question: Okay. Thanks.

Special Envoy Stern: I'm sorry. Jonathan might have (unintelligible).

Deputy Special Envoy Pershing: Just one additional point. This is Deputy Special Envoy Pershing. I was one of the lead authors of that particular chapter of the IPCC. And we should be very clear about what the report says. It actually does not make recommendations. It looks at a series of reports, a series of analyses that were made available and looks at the central tendency of those.

There are in fact, in that report other trends that are also possible, that also change the total trends of emissions going forward, not just the ones they report on. And they only report actually on a very small number of studies because not that many were done. So I think we need to be very careful about distinguishing the IPCC as a recommendatory body and the IPCC as an analytical body and that would be quite helpful. Thanks.

Question: Indeed. Thank you.

Question: Hi, yes. My question relates to the relationship between the U.S. and China, which is sort of probably the most important climate change relationship, (it has the biggest emissions).

Steven Chu said this week using China as a reason not to act is no longer what we want to go forward with. And I was just curious, in Copenhagen presumably still you're going to hold the China to - you're still going want China to commit to do something and you'll want it to be binding. I was wondering if you could comment on that.

Special Envoy Stern: Sure. Look, I think that Secretary Chu made a very important point which is reflected quite clearly in how we are and how the President is pursuing our domestic national climate change policy right now, which is to say that the President is pushing forward on the whole suite of policies that I've already alluded to and we are not doing that - when he is not - he is not standing back and saying, we're not going to get going, we're not going to take these very far reaching steps until we have some greater commitment by China, et cetera, et cetera, et cetera.

I think that that fundamentally is what Secretary Chu is reflecting. And I agree with that that the United States has got to get its own climate and energy policy moving on a - at high velocity and we are doing that and you can't wait on somebody else. So on that point I think that Secretary Chu is exactly right.

On the issue of what's required internationally, I don't think that there's any question that China and the other major economies have to be in the game, have to be preparing to do real things. By the way, they're doing a lot already and I'm certainly not meaning to suggest that they're not in the game; the Chinese have quite impressive policies. But they're going to need to do more and commit to them and be able to quantify them and have them be consistent with - in a general sense with where we're trying to go, where the world is trying to go over the course of the next 40 years or so.

So if you have fidelity to the kinds of objectives that we all do, including, most certainly in the EU, you cannot even begin to talk about it without having a very robust set of activities by the Chinese. So in an international context, absolutely, they've got to be part of it.

Question: Thanks.

Question: Yes, hi. Going back again to this first question. There's been some suggestion that the Waxman-Markey projections haven't really taken into account some of the policies that you've outline here, the Stimulus Package, some of the developments in the research that's already taking place. And that in fact, the real situation in 2020 might be much better than the projections.

And therefore, the U.S. negotiating position going into Copenhagen may be low balling the figures. And if that's the case, if the projections haven't been brought up to date, and that's one question. Have they been brought up to date and how realistic are they?

But, if they have not, then aren't we missing an opportunity to give others a bigger incentive to cut deeper into their own reductions if the U.S. is coming in with a low figure?

Special Envoy Stern: It's a good question. Let me just give you my perspective. I'm not trying to low ball anything and I'm not trying to keep anything in my pocket. If the numbers can turn out to be higher, nobody would be happier than me. But here's what I think, and I am not the numbers expert here.

But this is - what I think is that the kinds of policies that we're talking about, whether on tailpipe emissions or the R&D that's embedded in the Stimulus Package, I believe will be captured within an overall economy wide cap. So that the, you know, the players that have to meet the cap will, you know, will meet the cap with those policies, taking those policies into account.

I don't think that you'll meet the cap and then stretch beyond it because of those policies. I think the policies will be captured within the cap.

Jonathan you can jump in if you want.

Deputy Special Envoy Pershing: One last thing, part of your question was about the effect of both the Stimulus and of the consequence of the most recent economic dislocation.

In that context, there have been a series of analyses that have been run and they suggest it's a very short term effect, that in fact the long term trends will return to where we were before this had happened and that therefore you need all of these policies and they don't fundamentally (alter) a 2020 or 2030 horizon.

Special Envoy Stern: I'm not trying to low ball and we're not trying to low ball, but we are trying to be kind of accurate and not just come up with, you know, funny numbers.

Question: Hello. Good to hear you. Could you just talk just a little bit about the (yawning) gap, which is emerging between the developing countries and rich countries? I mean all the emphasis has been on the rich or the rapidly emerging countries. But what about the poor, what about Africa, what about these countries, where are they in your grand plan?

Special Envoy Stern: It's a good question, John. But could you just tell me, when you say, the (yawning) gap, gap with respect to (unintelligible).

Question: I'm hearing from the G77 and from the, if you like, the poor countries, that they're getting nothing, that here's very little on the table or remotely on the table for them. And these countries are going to have to be brought aboard in some way. All of the emphasis is (on how the rich do).

As I said, the G77 do seem to be extremely concerned that there's no money for adaptation, there's no money coming through, there's no promises, there's very little coming up. So can you just please talk about the rest of the world, if you like, the very poor countries who are feeling the effects of climate change already?

Special Envoy Stern: Yes, two things to say about that. First of all, I think that there is an active discussion that indeed has been going on, I think in a bilateral level and that began at a broader level in the major economies forum on Monday this week on issues of financing and providing financial flows to poor countries. And there was a quite active and lively and I think productive discussion on those issues. There are a number of proposals that are out there. There was actually a fair amount of discussion in Paris on a detailed proposal that Mexico has made for a green fund.

And there was discussion about the various different elements of what could be in a financing packaging and the sources of that, some of which are going to be public money, some of which is going to be carbon markets money, some of which is going to be private sector money.

And so, to say there's no money on the table, in a certain sense I suppose that's true, but only in the sense that things have not gelled to the point of a proposal, not that there's not active discussion among the major players with respect to that.

Now, let me just add another point or two. We are very much in agreement with your comment about adaptation. It's an important - and it's a difficult part of the equation actually because it's not so much part of the equation that is easily addressed through the carbon markets, which are more naturally useful for mitigation efforts.

But it's quite critical on an initial, and it's only a very initial basis, it's just some - not even a down payment but a kind of an initial effort on our part in the U.S., we have put a little bit less than $300 million into our budget request of new money for - specifically for international adaptation in our FY '10. So that's the fiscal year that would start October 1 request. So that's got to go through the, you know, through the Congressional mill before it gets finalized. But that's what we're asking for.

And again, that's - the amounts that would be needed are much more significant than that overall, but that was a kind of an initial effort for us to get some money into the system, not - before any new agreement got going, like right away.

The other thing that I would point out with respect to the poor countries is that efforts to bring about large scale mitigation are indeed quite critically important for the poor countries even though it doesn't involve them so much because they're not the ones who are largely responsible for the emissions.

The major emitters group accounts for 75% or 80% of worldwide emissions. And if you could get major cuts by the developed countries and major actions by the big developing countries - I mean, let's remember that by far the biggest emitter over the next, you know, decade is going to be China. If you could get significant action by all of the major economies that (unintelligible) importantly to everybody's benefit, but including Africa and other poor countries.

Question: Good morning. I want to know about the (current) agreement in Copenhagen. Could you give me a rough description, what type agreement you're going to accept in Copenhagen? I mean would it (acceptable) for (unintelligible) specific percentages, how much States can decrease their emission and how (should the) commitments of the developing countries be manifested? Thanks.

Special Envoy Stern: Look, you know, I think what I can say is we're looking for an agreement that's going to be strong, that's going to be effective, that's going to have reductions of a scope and ambition that are broadly consistent with what science is telling us needs to happen over the course of the next 40 years or so.

So, you know, again, the President has proposed cuts that would be 80% - more than 80% below 2005, of 80%, about 80% below 1990 as well over the course of the next several decades we are - I think that you will see major proposals in that range by the other - most of the other developed countries.

And I think with respect to developing countries, the most important thing for us with respect to the developing countries is to focus on the more advanced ones where the - where most of the emissions are coming from and are increasingly going to come from. And there I think we need to have commitments to take major steps that would - that could be quantified and that add up to the kind of thing broadly, not, like not on a specific point and a specific year but broadly get us in a direction of what most scientists are telling us we need to do.

So if the developing countries all did something, but it, you know, but it didn't get us anywhere near where we needed to be, that wouldn't be so good and if, you know, if their view was that they will be in a mode of strictly being on the voluntary side of the equation forever, that also wouldn't be so helpful. So we are looking to work very closely with the major developing countries, not expecting them to do the same thing that the major developed countries are doing but expecting them to do really what is urgently called for by the state of our atmosphere.

Question: Do you really think there will be an agreement in Copenhagen this year?

Special Envoy Stern: It's certainly our intention.

Question: Okay.

Question: Hi, good morning. Thank you very much for this conference call. I wonder as Todd, you said in the beginning that the U.S. ambitions actually are - might be equal to what the EU is going to do. And do you have numbers on that? And I think the best actually to express this would in gigatons carbon.

Secondly, there was a publication in Nature recently saying that the total amount, if you (unintelligible) the IPCC recommendations into total carbon in gigatons, that would be 666 billion additional tons of carbon dioxide until 2050. Is that an approach to define a total allowable CO2 in gigatons that might actually help the international negotiations?

Special Envoy Stern: Let me give you a couple of numbers, but they're not in gigatons, because that's not how I have it, so I can't answer it in those terms.

Just a second, I'm just looking to see if I have anything on that. No, I don't. But I can tell you in percentages, which is the best I can do, which is Waxman-Markey against 2005 would be about a 17% reduction. The EU goal of 20% reduction below 1990 in 2020 translates into about 14% reduction from 2005. The EU goal of 30% below 1990 in 2020 translates into about a 24% reduction below 2005.

So the EU 30% goal would still be a few points ahead of Waxman-Markey but obviously much closer. The EU 20% goal would be a few points less ambitious than Waxman-Markey.

So depending where the EU came out on that 20% or 30% question, they'd either be a few points ahead or a few points behind what we're talking about. I believe, but I don't - I know you've asked this gigaton question and I was looking to see if I had in my notebook something on this. My sense is that there is not a big difference between the EU under - I mean between the U.S. under - either Waxman-Markey or President Obama's proposal and what the EU is talking about on a going forward basis, which of course, when you talk about gigatons you're only talking about a going forward basis.

So I don't think that there is much difference, but I don't have the numbers at my fingertips. I think that they're very close. And of course the - if you're thinking about gigatons, again, that focuses the mind a little bit again on the going forward because you're not actually going to - you're actually not going to solve the problem of the atmosphere by looking backward to 1990. I mean the atmosphere doesn't really care about 1990; the atmosphere cares about what we're doing from now on.

And I don't have these numbers handy, but the massive numbers that you'd have to be concerned about are again, from China going forward.

Question: Okay. Yes, Jonathan said something in his opening remarks about the negotiating text, some of the issues were not covered, some of the issues that are in that text, you thought were inappropriate. I wonder if you could elaborate a little bit about how the U.S. submission was or was not taken into account in that negotiating text and, you know, what you feel the big points are that you're going to have to grapple with. Thanks.

Deputy Special Envoy Pershing: I'll just make two short comments about it and happy to talk further about it maybe in Bonn. The first point I would make is the negotiating text is an effort to try and reflect 70 odd different submissions. And if you look at anyone trying to do that, there is a lot of ways to think about how you try to compile things, which there's quite wide divergence of views on.

So, (Michael) made an effort to do that. One of the things you're often faced with is when you make a compellation like that do you go by which countries have submitted it or by the mere weight of the submission?

It turns out that the European Union makes a single submission for all the European countries. So is that to be counted as an equivalent weight of the submission from (Ghana)? Those kinds of questions, if you've got dozens of developing countries and only one from a developed group, balance out in interesting ways. And I think (Michael) reflects the preponderance of submissions and not so much the balance of national views that might be broadly ascertained.

So one of the things we'd like to go in and do is to try and create a better balance. With regard to some specifics, let me give you some examples.

One of the things that we believe is that there should be things that all countries undertake, not just some countries, all countries, developed and developing countries. All countries should look at ways they can reduce their emissions. And there should be some reflection of that comprehensive effort in this new agreement. It shouldn't merely say, some countries do something and other countries watch, it should say, all countries do something and there should be a second part of the text which makes some differentiation.

And that part of the text should be very clear that we don't expect and we don't think the agreement should undertake to obligate the least developed countries to do all that much. They need help, we need to help them. They need to move forward, but they need to move forward in the context of their development. That's very different from saying that the very large emerging economies or the quite wealthy countries that currently don't have obligations shouldn't be asked and shouldn't in fact agree to undertake significant next steps.

Singapore has the same per capita income as most of the OECD countries. Should it do nothing? Under the current agreement it doesn't have obligations. We think an appropriate formulation of the text would call for those wealthier more capable countries to undertake actions, the current text doesn't reflect it.

A second example, kind of a very, very different kind of a framework, the text has all these sections about what you do by way of reductions that call for targets. But nowhere does it make explicit that you might have a registry in which you'll be able to review with transparency national policies and programs. That's a proposal that's made by the Canadians, made by ourselves, made by the Japanese, made by Australia, doesn't show up in the text.

So those are the kind of things we'd like to come back on, lots of additional detail, happy to talk about that in Bonn.