EU and China climate and energy policies prior the Paris Agreement
The EU (Section 1) and a(Section 2) have developed two different approaches to climate change, especially in their years preceding the Paris Agreement.
Section 1: The EU Model
Prior to the Paris Agreement, the EU had distinctively established both a climate policy (Paragraph 1) and an energy policy (Paragraph 2) based upon different concerns and interests that have driven their development.
Paragraph 1: EU climate policy
Even if the EU has traditionally been considered “an international leader on climate change”86, climate and more largely the environment were not one of the priorities in the early days of the European Community. Indeed the ECs was originally designed as a response to the dramatic consequences of the Second World War. The main aspiration of the Treaty of Rome, signed in 1957, was to secure peace among old enemies by implementing trade and economic cooperation87. In the context of reconstruction, healing and economic growth, the environment did not feature as a relevant field of common action. The European Economic Community (EEC), established by the aforementioned Treaty had no environmental prerogatives. No references to the protection of the environment, nor the climate, were included in the founding 86 S. OBERTHÜR and L. GROEN, “The European Union and the Paris Agreement: leader , mediator or bystander?”, WIREs Clim Change, Wiley, Vol.8, Issue 1, 2017, p.445-453 text88. However the absence of a legal basis did not prevent the EEC from progressively intervening in this field.
Indeed the first environmental directives were adopted with the purpose of harmonising the common market and ensuring free movement of goods. Based on article 100 of the Treaty of Rome89, the directives tackled the packaging of some dangerous substances90 and noise limits of motor vehicles91. These rather sectorial initiatives were the premises of the EU environmental policy, which was formally established in Paris in 1972, thanks to a declaration of the European Council92. The declaration has been followed by the adoption of the first environmental program of the European Communities93 and eventually, the European Court of Justice recognised the protection of the environment as one of the essentials goals of the Community94. The EU environmental law and policy has thus evolved over the years “from a scattered and uncoordinated group of measures incidental to the overriding objectives of market integration to a sophisticated and detailed system of environmental regulation and multilevel governance”95. It is thanks to this progressive evolution that a whole body of law aiming to regulate and protect the environment has been put in place.
The issue of climate change has only been taken into consideration in recent years, developing as a subsidiary field of the environmental framework. Yet, the European Communities was probably among the first international organisations to recognise the phenomenon of global warming through the adoption of a resolution on June 21st 1989 stating, the urgency “to examine possibilities for action aiming at preventing or reducing the risks involved in the greenhouse effect”96. One year later, the first report of the IPCC in 1990 confirmed the alarming situation, raising awareness about the increase of CO2 emissions and their contribution to global warming. In response, the EC adopted the first community strategy to limit CO2 emissions and improve energy efficiency97. This strategy was published in 1991 89 Article 100 of the Treaty of Rome provides the Council with the power to adopt directives aiming at harmonise Member States’ measures which could have a direct impact on the common market following the instructions of the European Council98 and the Council of Ministers for the environment and energy99. EU leaders agreed to stabilise the greenhouse gas emissions of the European Communities at 1990 levels by 2000100. In addition to this, they included the promotion of renewable energies and the improvement of energy efficiency.
Climate action has developed as a subset of the EU competencies of the field of the environment. First of all, climate was and still is not an independent competence as listed in articles 4, 5 and 6 of the Treaty on the Functioning of the EU (TFEU). In this regard, climate action contributes to the protection of the environment, which was introduced as a main goal of the Community in 1986 thanks to the Single European Act. This also means that national environment ministers are still responsible for defining the climate policy, as in 1990 when the Council of Ministers for the environment and energy met to discuss the problem of carbon emissions. Moreover, the way that climate action initially developed is very similar to the way that environmental actions were put in place. The fact that the first adopted measures were rather political and declaratory, except for some sectorial measures such as voluntary agreements with car producers on emissions reductions in 1998101,102, recalls how the first environmental provisions were implemented.
The first real push for climate action was triggered by the Kyoto Protocol. The EC has been a key driving force in the development of the UNFCCC and its Kyoto Protocol103. During negotiations and the final agreement, the European Community was an influential advocate of legally binding emission reduction targets and timetables104.
The EC implication in the process of adoption of the UNFCCC has naturally pushed the Community climate action to improve. The adoption of the Protocol has been a major event, ensuring a turnover in the European climate action. Diverse instruments have been put in place 98 “We urge all countries to introduce extensive energy efficiency and conservation measures and to adopt as soon as possible targets and strategies for Limiting emissions of greenhouse gases” – European Council, Presidency Conclusions, Dublin 25 and 26 June 1990, Annex II: The Environmental Imperative, Council of the European Union, SN 60/1/90, 1990.
99 “The Community and Member States, (…) were willing to take actions aimed at reaching stabilization of the total CO2 emissions by 2000 at the 1990 level in the Community as a whole” – Council Decision of 24 June 1993 for a monitoring mechanism of Community CO2 and other greenhouse gas emissions (93/389/EEC).
100 European Council, Presidency Conclusions, Dublin 25 and 26 June 1990, Annex II: The Environmental Imperative, Council of the European Union, SN 60/1/90, 1990.
101 Decision No 1753/2000/EC of the European Parliament and of the Council of 22 June 2000 establishing a scheme to monitor the average specific emissions of carbon dioxide from new passenger cars to fulfil its commitment to 8% reductions of a basket of six GHGs during the commitment period 2008-2012 (compared to 1990 levels) under the Protocol105. These measures have been coordinated under the first European Climate Change Programme (ECCP). Within the Programme, the EC established the European emissions trading scheme (ETS), based on the Kyoto emissions reduction target; “(roughly) 40% of the EU’s total GHGs came under a system in which allowances to emit would be allocated and made tradable in a carbon market, in order to incentivize the most cost-effective forms of abatement”106. This scheme was effectively put in place with the ETS Directive adopted in 2003107. In parallel to this scheme, other measures concerning energy efficiency and renewable energies were put in place, but these will be tackled in the next section. In conclusion, Kyoto has therefore been a milestone in the development of the European climate action. Its aftermath has been characterised by the establishment of an innovative market system that strives for the reduction of carbon emissions.
Moreover, the characteristic market approach, justifying the adoption of a long-term programme and market related provisions to tackle climate change, recalls the way that the EC started to legislate on the environment. The legal basis used to implement the first environmental measures was Article 100 of the Treaty establishing the European Community (TCE). Similarly, the ETS is a market mechanism even if it was adopted on the basis of Article 175 TCE (now Article 192 of the Treaty on the EU (TEU)). Additionally, the EC made the decision to adopt a long-term programme for climate action the same way it did for the environment. These programmes “help identify the most environmentally effective and most cost-effective policies and measures that can be taken at European level to cut greenhouse gas emissions”108. It is a multi-stakeholder consultative process that enables the implementation of common, coordinated policies and measures. More specifically, the first Climate Programme dovetailed with the EU’s Sixth Environmental Action Programme (2002-2012), thus deepening the linkage between the two fields of intervention and strengthening the articulation between environmental and climate action. Consequently ECCPs have the same legal value of environmental programmes. After the revision of the treaty of Maastricht, Article 192 TFEU provided that environmental action programmes – titled ‘general action programmes’ – shall be adopted under the ordinary legislative procedure. Thus, “these programmes have to be legally binding; otherwise, the application of the ordinary legislative procedure would make no sense”109.
Climate action has increasingly gained importance, especially after the Copenhagen Conference of 2009. This strongly criticised conference can still be considered as a major milestone for European climate action. Indeed, as a phoenix reborn from its ashes, the European Union had to react to the feeling of deception that spread after the conference. The Copenhagen aftermath was therefore a real boost for European climate action, with its preparation contributing to the adoption of new provisions. Three major events characterise the pre- and post- Copenhagen situation.
First of all, in March 2007, “EU Heads of State agreed on a set of three targets referred to as ‘20-20-20 by 2020’”110 including a target on GHG emissions, renewable energies and energy efficiency. These provisions were included in a 2020 Climate and Energy Package. It is “a set of binding legislation to ensure the EU meets its climate and energy targets”111. Hence, this package has real legal force on the Member States organisation and it stands as a general engagement for the whole Union. In order to reach these targets, all Member States have to contribute according to their individual national wealth112, with “progress (being) monitored by the Commission every year, with each country required to report its emissions”113. Again, we can identify a real rapprochement with the environmental body, and specifically the principle of common but differentiated responsibilities. This characteristic principle of international environmental law is one of the foundations of global governance and it has clearly been transposed in European climate action through the 2020 legal framework and the package mechanism. The Climate and Energy Package adds up to the broader ECCP. Yet, the first is more detailed and specific than the latter. Also, programmes gather Stakeholder Working Groups to “draw on a broad spectrum of expertise and helps to build consensus, thereby facilitating the implementation of the resulting policies and measures”114. Finally the ECCP was created to implement the European commitments towards the Kyoto Protocol. On the other hand, Climate and Energy Packages are the result of a self-determination approach which reflects the EU’s desire to practice “leadership-by example”115, in order to “consistently advocate for ‘targets and timetables’ for action”116.
In preparation for the Copenhagen conference, the EU wanted to take the lead and in order to do so, different stands were taken across different economic sectors, “putting together a ‘jigsaw’ of policy approaches that (are) effective, coherent, and cost-effective”117. One of the major measures that the EU adopted to differentiate itself as a climate leader, was probably the extension of the ETS directive in order to cover aviation emissions118. Indeed, although aviation emissions dramatically contribute to global warming, representing 2% of GHG emissions on a global level119, this transport sector had been voluntarily excluded in the Kyoto Protocol. The fact that the EU unilaterally decided to subject all airlines operating flights into and out of European territory to the EU ETS was not welcomed by all countries. This measure, which was perceived as provocative by some non-Member States triggered negative reactions from international airlines, especially the American ones120. Litigation before the European Union Court of Justice was not avoided but judges supported the measure by stating that “the Directive including aviation activities in the Community scheme for CO2 emission allowance trading does not infringe either the principles of customary international law or the provisions of the ‘Open Skies’ Agreement”121. However, the EU decided to take a step back and negotiate with its partners and the International Civil Aviation Organisation to find a collaborative solution: only airlines operating in Europe, European and non-European alike, are required to monitor, report and verify their emissions122.
This negotiation took place after the Copenhagen conference, which was “privately described by the president of the European Council Herman van Rompuy as an ‘incredible disaster’”123. The highly ambitious European Union was polarized by the less progressive positions held by the US and China124. Hence, for the EU, the Copenhagen aftermath was characterised by a reconstruction process of its global role towards climate action. Thus, the collaborative negotiations on the inclusion of aviation emissions in the EU ETS system are probably one of the results of this phase.
The EU’s climate action was also reinvigorated by a major institutional revision. In 2010 the Directorate-General for Climate Action (DG-Clima) was established, thus setting a new image and a fresh start for the EU. In this regard, climate action was separate from the mandate of the Directorate-General for the Environment. From a political point of view this major reform highlighted the importance of climate action and the necessity to provide an independent body to fulfil European goals and expectations. DG-Clima “leads international negotiations on climate, helps the EU to deal with the consequences of climate change and to meet its targets for 2020, as well as develops and implements the EU Emissions Trading System”125.
In conclusion, although the Copenhagen conference was perceived as unsuccessful, it can still be identified as “a turning point in the EU’s frontrunner approach”126 to climate change. Not only did it allow the Union to raise its targets and ambitions in preparation for the conference, but it also triggered a restructuring of its institutional and climate policies. Accordingly, the EU had to reinvent and work on its position on a global level, which eventually led to the Paris Conference and its successful outcome. In parallel, European energy policy was also developed throughout the establishment of the European Union.
123 A. JORDAN and T. RAYNER “The evolution of climate policy in the European Union: an historical overview” .
Paragraph 2: EU energy policy
The European energy sector is probably one of the most complex fields of competence due to the diverse concerns and interests linked to energy production and supply. However, compared to the environmental sector or climate action, energy has been a major area of intervention since the very beginning. Looking at European history, the European Communities was founded upon treaties tackling trade of fossil fuels and energy sources. Indeed, the European Coal and Steel Community (ECSC) and the European Atomic Energy Community (Euratom) are two of the three pillars of the European Communities system127. The European construction shows the relevance and the importance of this sector. Energy poses several issues that justify the early intervention of an ad hoc organization such as the ECSC and the Euratom. Energy security (supply and demand), economic development, international security, environmental sustainability, domestic good governance are the common objectives of global energy governance128. In this regard “the ECSC (Art.3) set out the concept of ‘Security of Supply’ in Community law, and as a main objective”129. In parallel, “the Euratom Treaty (art.52) established an internal market along with a Supply Agency (operational from 1960) that led to community policy in the field of nuclear energy”130.
During its first years of existence, the European Communities was highly active in the energy sector. The commitment of the Council coupled with a deep belief in the importance of taking action, pushed the Commission to adopt the “Community Energy Policy” in 1968. Indeed, the Council considered a lack of integration in the energy sphere as a “dangerous trend”131. The policy would counterbalance “risks arising from the great dependence of Member States on imports and from insufficient diversification of the sources of supply”132. In this regard, the European approach to energy was self-centred. The idea was to create inter-dependency among Member States: this would increase security on an internal level and would boost economic growth through energy trade133. This closed approach to the energy field has characterised European energy policy throughout its development. The complexity of the sector and its transversal impact on other fields such as trade, the environment, transports, etc may be one of the explanations for this trend, as well as the difficulty in reaching consensus on a topic that affects the security and sovereignty of states.
Overall, the adopted measures in the energy field were rather political and lacked enforceability. Indeed, although the European Communities was first founded on the trade of energy sources and nuclear energy, its institutions did not have the legal basis134 to adopt any specific measure tackling the energy sector. Measures had to rely on other legal grounds in the TCE such as the terms for approximation of domestic laws135; measures to avoid difficulties in the supply of products136 or the common effort for research137. With such a soft legal framework, the years following the establishment of the European Community and its initial development were not characterised by an enriching energy policy. Between the 1970s and the 1980s, the European Commission strove to propose energy policies aimed at progressive integration138. Despite the awareness of potential hazards of energy dependency, especially from Russia, and the lack of a common policy framework, European states did not act to pool their resources together and build a structured response to the various issues related to the energy field. Member States were hesitant to give up their competence in such a delicate field. Also, until the mid 1980s, the fossil fuel sector was flourishing and it did not seem to require any common legislation to make it sustainable. Indeed, the fact that Member States did not insert a legal basis for energy action in the founding Treaties of the Community, reveals their reluctance to give up part of their sovereignty towards the management of the energy sector. Additionally, Member States did not feel the urgency of taking action even though the Commission had predicted that the era of easy energy supply had “little chance of being maintained”139. When the oil crises struck in 1973 and 1979 respectively, it “highlighted both concerns about vulnerability to interruptions of energy supply, and the inadequacy of securing supplies for the EU”140. This factor may explain the vigorous aftermath that provided the Community with some basis for an expanding energy policy.
The Single European Act of 1986 was a turning point for the energy sector in the EC. The following treaty established the internal market, which settled the background for a dynamic and positive evolution of the European energy policy. Implementing market measures to deepen and justify an integrative approach is a common procedure for the EU. In the same way that the Community gained competence on environmental aspects through market measures, the same method was employed to develop the legal energy framework. Subsequently, “the Maastricht Treaty (1992) and then the Amsterdam Treaty (1997) widened the focus of energy related matters with security of supply as a main issue”141. During this period of time, several measures were adopted and the 1991 Specific Actions for Vigorous Energy Efficiency (SAVE) programme coordinated part of the initial measures. Common standards regarding hot water boilers, household electric refrigerators, freezers and combinations were introduced142 as well as a labelling system for household appliances143. Moreover, a SAVE Directive144 was put in place “which required MS to limit GHG emissions by further measures such as energy audits for energy intensive companies, building certification or thermal insulation of new buildings”145. Also, a 1996 directive146 established the internal electricity market. In this regard, all these measures were adopted in a market approach. Finally, it is important to mention all the Green Papers arguing energy strategies for the Union147. The spirit of harmonising national standards, approximating laws and consumers’ protection can be spotted in all the aforementioned measures. Hence, energy policy was initially built upon economic and trade grounds. The twin aims of energy competitiveness and supply security boosted cohesion and consensus among Member States.
Nevertheless, an important step forward was made by the community thanks to increasing awareness of environmental and climate issues. Indeed, many scholars have identified the role that the environment and climate change played in the extension of the European Union’s competence towards the energy sector148. Indeed, in the 1995 White Paper the main objectives for improved competitiveness, security of supply and protection of the environment were identified and renewable energy was recognised as a factor to help achieve these objectives. The 1997 White Paper, set an indicative target of 12% share of renewable energy sources in total energy consumption by 2010149. Promoting renewable energies and facilitating energy efficiency were two of the three main goals of the ECCP in implementing the Kyoto Protocol of 1997. In this context, despite the hard lobbying of some major electric and gas companies, such as EDF and Ruhrgas to kill the integrative approach of the energy sector 150, the Community did not back down on its project. The beginning of the 21st century was a prosperous period for the energy sector and the development of a common European policy framework151. Several additional measures were adopted to develop the internal electricity market152 and to tackle specific matters such as biofuels153. This trend reached its culminating point with the signature of the Lisbon Treaty in 2007.
The Lisbon Treaty was the second milestone in the evolution of the European energy policy. Indeed, when the treaty came into force, the energy field went through a major development. The treaty settled a legal basis for common European action under Article 194 of the TFEU and by defining it as a shared competence under Article 4 of the TFEU. Following the principles of subsidiarity, proportionality and better regulation, the Union energy policy aims to “ensure the functioning of the energy market; ensure security of energy supply in the Union; promote energy efficiency and energy saving and the development of new and renewable forms of energy; and promote the interconnection of energy networks.
Table of contents :
PART I – The impact of the Paris Agreement on EU and China environmental and energy policies
Title 1: EU and China climate and energy policies prior the Paris Agreement
Section 1: The EU Model
Paragraph 1: EU climate policy
Paragraph 2: EU energy policy
Section 2: The Chinese model
Paragraph 1: The Chinese climate policy
Paragraph 2: The Chinese energy policy
Title 2: EU and China climate and energy policies after the Paris Agreement
Section 1: The EU model
Paragraph 1: EU climate policy
Paragraph 2: EU energy policy
Section 2: The Chinese model
Paragraph 1: The Chinese climate policy
Paragraph 2: The Chinese energy policy
PART II – The implementation of the principle of cooperation within the EU-China energy cooperation in the perspective of the Paris Agreement
Title 1: The diplomatic implementation of the principle of cooperation under the EU-China energy cooperation framework prior to the Paris Agreement
Section 1: Assets and limits of the application of the principle of cooperation within the EUChina energy negotiations
Paragraph 1: Instruments of negotiations between China and the EU: Dynamic implementation of the principle of cooperation
Paragraph: 2: Legal limits to a total application of the principle of cooperation to the EU-China energy negotiations
Section 2: The EU-China institutional energy framework: an innovative and developing approach of the principle of cooperation
Paragraph 1: The premises of a durable EU-China energy cooperation
Paragraph 2: An innovative approach to the EU-China energy cooperation in perspective of the institutional framework
Title 2: Market mechanisms within EU-China energy cooperation: a practical implementation of the principle of cooperation after the Paris Agreement
Section 1: The integration of market mechanisms in the Paris Agreement: a new approach to the principle of cooperation
Paragraph 1: The fundamental link between trade and climate-friendly measures: the relevant example of EU-China energy cooperation
Paragraph 2: “Learning-by-doing”: the definition of market mechanism, cooperation based on the previous experience of the Kyoto Protocol
Section 2: The practical implementation of the market mechanisms within the EU-China energy
Paragraph 1: EU-China green bonds: the influence of the Paris Agreement cooperation approach on an already existing market mechanism
Paragraph 2: The potential connection between the Chinese and EU ETSs: the culmination of the Sino-European energy cooperation