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Presentation on theme: "KYOTO PROTOCOL & STATUTE REGARDING ENVIRONMENTAL PROTECTION IN INDIA Legal Environment Of Business 1."— Presentation transcript:


2 Team Members  A G Jain  Anita Prajapati  Master Govind  Pooja Chauhan  Tanisha Singh  Vikas Jindal 2

3 Content  Global Warming & its Implication  Kyoto Protocol  Carbon Credit  Global Trading System  Indian perspective  Indian StatutePre Tragedy  Rule of Strict And Absolute Liability  Environmental protection Act  Bibliography 3

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5 Global Implication  The number of hurricanes has almost doubled in the last 30 years.  Malaria has spread to higher altitudes in places like the Colombian Andes, 7,000 feet above sea level.  The flow of ice from glaciers in Greenland has more than doubled over the past decade.  At least 279 species of plants and animals are already responding to global warming, moving closer to the poles. 5

6  Deaths from global warming will double in just 25 years—to 300,000 people a year.  Global sea levels could rise by more than 20 feet with the loss of shelf ice in Greenland and Antarctica, devastating coastal areas worldwide.  Heat waves will be more frequent and more intense.  Droughts and wildfires will occur more often.  The Arctic Ocean could be ice free in summer by 2050.  More than a million species worldwide could be driven to extinction by 2050. Global Implication Contd.. 6

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8 Climate Change Rapid Industrial Growth Increased energy consumption Increased CO 2 and other GHG emissions Global Warming due to increased concentration of GHG Increased Sea Level Changes in wind and precipitation Changes in Crop yields 8

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10 Kyoto Protocol  An amendment to the international treaty on climate change, assigning mandatory targets for the reduction of greenhouse gas emissions to signatory nations  Only Parties to the Convention that have also become Parties to the Protocol will be bound by the Protocol’s commitments. (by ratifying, accepting, approving, or acceding to it)  183 countries and one regional economic integration organization (the EEC) have ratified the Protocol to date. 10

11 Time-Line  May 1992: UN FCCC* establishes framework for containing global warming  Dec 1997: Following intense negotiations in Kyoto (Japan), a protocol is agreed upon by over 100 countries  Feb 2005: 141 countries, including EU, Japan, Canada, and Russia sign the Kyoto Protocol and it gets ratified w.e.f. 16-Feb-05 – The US remains a key non-signatory  The Kyoto Protocol sets legally binding targets for reducing green house gases (GHGs) – Developed countries have a target to reduce GHG emissions by 5.2% below 1990 levels, by year 2012 – EU members committed to reduce their average emissions by 8 % – India, China, and Brazil are classified as emerging countries and hence exempted from this protocol 11

12 Green House Gases  Green house gases (GHGs) are gases that result in global warming  Degree of warming caused by a specific GHG depends upon its CO2 equivalence (CO2e)  6 GHGs are regulated under the Kyoto Protocol – Carbon dioxide (CO2) – Methane (CH4) – Nitrous oxide (N2O) – Hydrofluorocarbons (HFCs) – Perfulourocarbons (PFCs) – Sulphur Hexafluoride (SF6)  There are at least 25 other gases, including chloroform, CO, and water vapour that influence climate-change  Above-mentioned six are key ones, that can be controlled by human intervention with relative ease 12

13 Global warming potential  Global warming potential (GWP) for the 6 GHGs are summarised below: GHG:Global Warming Potential  Hydrofluorcarbons (HFCs) :140 – 11,700  Perfluorcarbons (PFCs) :6500 – 9,200  Methane :21  Nitrous oxide :310  Sulphur hexafluoride :23,900  Carbon dioxide :1  GWP is the global warming impact that a GHG would have over a 100-year timeframe – By definition, CO2 is used as the reference benchmark, with GWP of 1 13

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15 CARBON CREDIT  Carbon credits are certificates issued to countries that reduce their GHG emissions One credit = 1 tonne of CO2 (or CO2 equivalent) reduced  Surplus credits result when a country overshoots its reduction target – These can be traded, with countries facing a shortfall in target able to buy and meet their targets – Carbon credit trading encourages emission reduction, provides financial incentives to those who do 15

16 Kyoto Protocol Mechanism  The Protocol allows developed countries to reach their targets in different ways through “Flexibility Mechanism”  Joint Implementation (JI)  Clean Development Mechanism (CDM)  Emission Trading (ET) 16

17 UNFCCC KP PROJECT BASED ALLOWANCE BASED IET (Between Developed Countries) JI (Between Developed Countries) CDM (Developed & Developing Countries) Assigned amount units (AAU) Emission Reduction Units (ERU) Carbon Reduction Units (CER) K P Mechanism Contd.. 17

18 1.International Emission Trading  Emissions trading (ET) is a mechanism that enables countries with legally binding emission targets to buy and sell emissions allowances among themselves  Each country has a certain number of emission allowances (amount of carbon dioxide it can emit) in line with its Kyoto reduction targets  The IET allows industrialized countries to trade their surplus credits on the international carbon credit market K P Mechanism Contd.. 18

19 2. Clean Development Mechanism Developed CountriesDeveloping Countries Carbon Credits Technology Transfer & project Financing CDM K P Mechanism Contd.. 19

20 CDM Cont..  The purpose of CDM is reduce to emissions and also contribute to sustainable development in developing countries  The CDM is administered by the CDM Executive Board (CDM Board) which reports and is accountable to the Conference of Parties (COP).  A Carbon emission reduction (CER) is given by the CDM Executive Board  One CER is equivalent to one tonne of carbon dioxide reduced 20

21 CER – Source of Generation  Industries like  Agriculture  Energy (renewable & non-renewable sources)  Manufacturing  Metal production  Mining and mineral production  Chemicals  Afforestation & reforestation 21

22 3. Joint Implementation  Projects between industrialized nations to earn emission offsets  It is done because of geographical or cost implications  Emission reduction units (ERUs) created through joint implementation is treated in the same way as those from emissions trading K P Mechanism Contd.. 22

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24 European Union Emission Trading Scheme  The European Union Emission Trading Scheme (EU ETS) is the largest multinational, greenhouse emissions scheme in the world. It commenced trading in 2005  Under Kyoto EU committed to reduce 8% 1990 levels of emissions in 2008 to 2012 24

25 EU ETS Cont..  The Kyoto protocol sets targets to countries  The States list down the amount and method of allocating allowances to facilities under NAP  The total allowances granted = Kyoto target  Determinants of demand  Volumes are tracked by National registries  Registries keep track of the allowance ownership transfers 25

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27 How Carbon Credit works? An Example:  British Petroleum in UK emitting more than the accepted norms of UNFCCC  Tie up with Subsidiary in India or China Under CDM  The credits arising out of the use of the new technology are sold to counterparts in Europe  Thus a carbon credit market is created 27

28 Carbon trading in India  Bilateral trade  No fixed norms of emission reduction by government.  Potential Participants  Registry 28

29 Carbon Trading in India cont..  Multi Commodity Exchange of India Ltd. ( MCX) entered into a strategic alliance with CCX in September 2005 to initiate carbon trading in India.  Offers Mini version of ECX CFI & CCFE SFI  The tie-up would provide immense scope and opportunity for domestic suppliers to realize better prices for their carbon credits  India being a major supplier of carbon credits, the tie-up between the two exchanges is expected to ensure better price discovery of carbon credits 29

30 India’s potential  India – Non Annexure I country, has a large scope in emissions trading  India and china together contribute to $5 billion of the global carbon trade estimated at $30billion  It is one of the leading generators of CERs through CDM  Analysts forecast that its trading in carbon credits would touch US$ 100 billion by 2010  Currently, the total registered CDM projects are more than 300, almost 1/3rd of the total CDM projects registered with the UNFCCC  The total issued CERs with India as a host country till now stand at around 34 million, again around 1/3rd of the total CERs issued by the UNFCCC 30

31 Benefits of Carbon Trading  Sellers and intermediaries can hedge against price risk  There is no counterparty risk as the Exchange guarantees the trade  The price discovery on the Exchange platform ensures a fair price for both the buyer and the seller  Players are brought to a single platform, thus eliminating the laborious process of identifying either buyers or sellers with enough credibility 31

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33 Bhopal Gas Tragedy  In city ‘Heart Of India’ named Bhopal  UCIL..  Exposing 520,000 people to toxic gases..  Over 22,000 people died..  Due to:The use of hazardous chemicals (MIC) instead of less dangerous ones  Storing these chemicals in large tanks instead of several smaller ones  Possible corroding material in pipelines  Poor maintenance after the plant ceased production in the early 1980s  Failure of several safety systems (due to poor maintenance and regulations)  Leads to: 33

34 Pre Tragedy Indian Statute  The Water (Prevention and control of Pollution) Act, 1974  The Air (Prevention and control of Pollution) Act, 1981  Forest Conservation Act, 1980  The Wild Life Protection Act, 1972 34

35 Rule Of Strict liability  Formulated by House of Lords in 1868  Continues to be in Force in India under Article, 372 of Indian Constitution  Available under Law Of Torts  Rylands vs. Fletcher Case Construction of Reservoir through independent Contractor Old Disused Shaft were neglected on the site Resulting in flooding the adjacent coal mine with water 35

36  The Rule:  “If a person brings on his land anything which is likely to do Mischief if it escapes, He will be Prima Facie answerable for the damage cause by its escape even though he was not negligent”. Rule to be Applicable Dangerous things Escape Non Natural use of land 36

37  Exception to Strict Liability:  Plaintiff’s Own Default  Act Of God  Consent of the Plaintiff  Act of third Party  Statutory Authority 37

38 Post Tragedy : Rule of Absolute Liability  Due to failure of Rule of Strict Liability for its exception  M. C. Mehta vs Union of India case.  By Supreme Court in 1987  The Rule:  “When an enterprise is engaged in a hazardous or inherently dangerous industry which posses a potential threat to the health and safety of people, it owes an absolute and non-delegable Duty to ensure that no harm results to anyone from such activity”. 38

39 Environmental Law & Consitution Of India  Specific Provision for Environmental protection  Article 19(1)(g) 3  Article 21 4  Article 47 5  Article 48A 6  Article 51A(g) 7 39

40 THE ENVIRONMENT (PROTECTION) ACT, 1986  Scope and Scheme of the Act  Come into force on 19 Nov 1986  Extends to whole of India  Fixes responsibility on person’s carrying on Industrial operations or Handling Hazardous substances  To comply with certain Safety norms for prevention, control and abatement of Environmental pollution.  Granted power to Central Govt. for environmental protection 40

41 Bibliography      http://www.baker& http://www.baker&   Economic Labour & Industrial law by ICSI  Economic law by V.S.Datey 41

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