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Ukraine Breaks With Russia on Pollution to Ally With EU

12.12.2014

Ukraine, having found an unlikely alliance with Russia at UN talks on global warming, reversed its position to back the European Union on ratifying a treaty that limits pollution.

In a last-minute U-turn, Ukraine gave up demands to delay rules on the second stage of commitments under the Kyoto Protocol. Earlier this week, the nation stood with Russia in seeking to hold up rules needed to bring the treaty into force because they cut potential earnings from emissions credits.

Countries in Eastern Europe built up a surplus of Assigned Amount Units, which is the UN currency for limiting fossil-fuel emissions, after their economies collapsed in the 1990s with the fall of Communism. Until today, Ukraine was seeking more discussion on the rules on selling of those units or using them to comply with future pollution. The European Union signaled it will not agree to changes in the accounting methods.

“We were waiting for a final decision of our minister,” Vitaliy Kindrativ, Ukraine’s deputy head of department at the Ministry of Ecology and Natural Resources, said in an interview in Lima. “Today we met the German delegation and the European Union delegation, and we confirmed that the EU way is the only way for Ukraine. We agreed on the text and the Kyoto rules.”

The Kyoto Protocol limits greenhouse pollutants in industrialized nations, leaving poorer countries to make only voluntary commitments. The first phase of the treaty’s limits ran to 2012, and nations now are working to ratify the second commitment period of the deal that has limits through 2020.

Kyoto Limits

Ukraine has limits through 2020 under Kyoto, though Russia decided not to join in the second period. Carbon trading mechanisms and accounting rules are administered by the UN conference, which is due to finish its annual meeting today in Lima, Peru.

It’s up to the presiding officer at the UN climate talks whether to re-open the issue or postpone it until June. If he does, envoys from 190 nations would need to come to a consensus on the issue. The rules would enable ratification of the 2013-2020 phase of the Kyoto Protocol.

A Russian delegate to the talks demanded at a meeting on Dec. 10 more discussions on the text of the decision, and Belarus backed it. The Ukrainian negotiator told the gathering that as her country is in an extremely difficult humanitarian, social and economic situation, it’s more difficult to comply with the rules on carbon pollution.

Russian Fighters

Ukraine is trying to halt hostilities and start new talks with the pro-Russian insurgents it’s fighting in its eastern Donetsk and Luhansk regions. The crisis has triggered Russia’s worst standoff since the Cold War with the U.S. and Europe. Russia denies it’s involved in the conflict.

Caps on the emissions of countries under the Kyoto Protocol are represented by Assigned Amount Units, handed out to nations that take on legally binding targets. Those that exceed their pollution limits may buy AAUs from ones that enact deeper cuts than required.

Under a deal reached two years ago at the UN talks in Doha, in the second phase from 2013 to 2020 countries will be allowed to purchase AAUs equivalent to 2 percent of their cap for the first five-year period through 2012. That would limit the risk of trading surplus permits, which environment groups including Greenpeace dubbed “hot air.”

Easy Life

“It would have made life much easier for all Kyoto parties if we would have agreed on the accounting rules,” Karsten Sach, lead climate negotiator for Germany, said earlier today. “We would not support any approach to redefine what we agreed upon in Doha. I really hope that the issue will be constructively solved. We appeal to all the parties who have a stake in that to come back to the negotiating table.”

The dispute may have zero commercial significance for Russia, which is not allowed to use UN carbon markets after failing to adopt new Kyoto targets. Ukraine and eastern EU member states have the right to store unused units for selling in the future, though at the moment demand for those securities is shrinking.

And it’s increasingly clear the biggest polluters won’t buy the credits anyway. The EU’s 28 nations along with Australia, Japan, Liechtenstein, Monaco, Norway and Switzerland said in Doha they won’t buy permits carried over from the first period.

The adoption of the Doha pact angered Russia’s delegates to the conference. Abdullah Bin Hamad Al-Attiyah, the Qatari diplomat presiding over the 2012 talks, gaveled the decisions through with such speed that he overlooked an objection from Russia, prompting cheers and applause from hundreds of delegates present.

“Russia has nothing to win economically here,” Maria Storchylo, an officer at the National Ecological Centre of Ukraine, said in an interview today. “They just want to show that they still have a strong negotiating position and are ready to defend their former allies: Ukraine and Belarus.”

Ewa Krukowska, Bloomberg

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