1. An introduction to technology-oriented agreements
Heleen de Coninck (ECN/IVM)
ECN side-event COP13 – December 7th, 2007

2. Background: status post-2012
Agreement to agree. But on what?
EU continues on cap-and-trade track
United States: might not sign up to an international carbon cap
US Congress difficulty to agree on meaningful climate act
US Senate not favourable to cap-and-trade (filibustering)
Emerging economies: no strict commitments
A post-2012 treaty a la Kyoto with broad Annex-I participation unlikely
Complex patchwork of treaties more conducive, including cap-and-trade, sectoral and technology agreements
Question:
What can we expect from sectoral and technology agreements?

3. Alternative or complement to cap-and-trade?
Disinterest in cap-and-trade can be explained for countries with low climate change impacts and high mitigation costs
Provision of a global public good; free-rider incentives
Sectoral agreements (IEA, Pew Center) and TOAs might provide participation incentives
Predictable costs
Innovation market failure
Potentially smaller number of parties (club good)
Interests of current technology leaders (first-mover advantage)
and large developing countries (targeted and more effective technology transfer)

4. Context and forms of TOAs
“International agreements that are aimed at advancing specific technologies”
Four types:
Knowledge sharing and coordination
Research, development and demonstration
Technology transfer
Technology mandates, standards and incentives

5. Context and forms of TOAs
Type 1:
Knowledge sharing and coordination
Carbon Sequestration Leadership Forum (CSLF) and the International Platform on the Hydrogen Economy (IPHE)
Methane to Markets Partnership (M2M)
Task sharing within IEA Implementing Agreements (IEA-IA)
Asia-Pacific Partnership on Clean Development and Climate (APP)
Energy Star bilateral agreements
Type 2:
RD&D
European Organization for Nuclear Research (CERN)
ITER fusion reactor
Cost sharing within IEA Implementing Agreements (IEA-IA)
The Solvent Refined Coal II Demonstration Project (SRC-II)
Type 3:
Technology transfer
Multilateral Fund under the Montreal Protocol
Global Environment Facility (GEF)
Type 4:
Technology incentives, mandates, standards
International Convention for the Prevention of Pollution from Ships (MARPOL)
European Union Renewables Directive

6. Context and forms of TOAs - conclusions
Knowledge sharing and coordination, and RD&D (Types 1 and 2) not environmentally effective on their own, but can be useful for low-cost or underdeveloped technologies
Technology transfer agreements (Type 3) can be effective if substantial funds committed, but unlikely to be sufficient in scope on their own
Technology incentives, mandates and standards (Type 4) can be environmentally effective on their own, although in most cases less cost-effective than cap-and-trade approaches

7. Context and forms of TOAs - conclusions
Type-4 agreements may be more effective for:
Sectors with significant ancillary benefits
Highly trade-sensitive sectors
Sectors not covered by cap-and-trade systems
Sectors that might benefit from international coordination

8. Conclusions
Technology-oriented agreements can take many forms and can be appealing for different reasons, e.g. more manageable number of actors, greater cost predictability, innovation benefits, large emission reductions
It makes sense to explore TOAs, as they may offer political advantages
However, global cost-effectiveness and simplicity of one global cap-and-trade are sacrificed
In order to be environmentally effective, TOAs should primarily be aimed at technological implementation (Type-4)
It is possible to pursue such agreements without straying from the cap-and-trade track

9. Thank you More information and report copies: Heleen de Coninck
Energy research Centre of the Netherlands
Unit Policy Studies
Radarport 60/P.O.Box 56890
1040 AW Amsterdam
Tel