IPCC Fourth Assessment Report: Climate Change 2007
Climate Change 2007: Working Group III: Mitigation of Climate Change

13.3.3 Proposals for climate change agreements

The literature on climate change contains a large number of proposals on possible future international agreements. Table 13.2 provides a summary review of recent proposals for international climate agreements as reported in the literature (see also Bodansky, 2004; Kameyama, 2004; Philibert, 2005a), although not all proposals cover all elements that are necessary to describe a full regime. The list of proposals is grouped around the following themes: national emission targets and emission trading, sectoral approaches, policies and measures, technology, development-oriented actions, adaptation, financing and proposals focusing on negotiation process and treaty structure.

Table 13.2: Overview of recent proposals for international climate agreements.

Name (reference) Description 
National emission targets and emission trading 

National emission targets and emissions trading




Staged systems 
Multistage with differentiated reductions: Gupta, 1998; Berk and den Elzen, 2001; Blanchard et al., 2003; Criqui et al., 2003; Gupta, 2003a; Höhne et al., 2003; Höhne et al., 2005; Michaelowa et al., 2005b; den Elzen and Meinshausen, 2006, den Elzen et al., 2006a Countries participate in the system with different stages and stage-specific types of targets; countries transition between stages as a function of indicators; proposal specify stringency of the different stages 
Differentiating groups of countries: Storey, 2002; Ott et al., 2004 Countries participate in the system with different stages and stage-specific types of targets 
Converging markets: Tangen and Hasselknippe, 2005 Scenario with regional emission trading systems converging to a full global post 2012 market system 
Three-part policy architecture: Stavins, 2001 All nations with income above agreed threshold take on different targets (fixed or growth); long-term targets (flexible but stringent); short-term (firm, but moderate); and market-based policy instruments, e.g., emissions trading. 



Allocation methods 
Equal per capita allocation: Baer et al, 2000; Wicke, 2005 All countries are allocated emission entitlements based on their population. 
Contraction and convergence: GCI, 2005 Agreement on a global emission path that leads to an agreed long-term stabilization level for greenhouse gas concentrations (‘Contraction’). Emission targets for all individual countries set so per-capita emissions converge (‘Convergence’). 
Basic needs or survival emissions: Aslam, 2002; Pan, 2005 Emission entitlements based on an assessment of emissions to satisfy basic human needs. 
Adjusted per capita allocation: Gupta and Bhandari, 1999 Allocation of equal per capita emissions with adjustments using emissions per GDP relative to Annex I average. 
Equal per capita emissions over time: Bode, 2004 Allocation based on (1) converging per capita emissions and (2) average per capita emissions for the convergence period that are equal for all countries.  
Common but differentiated convergence: Höhne et al., 2006 Annex I countries’ per capita emissions converge to low levels within a fixed period. Non-Annex I countries converge to the same level in the same timeframe, but starting when their per capita emissions reach an agreed percentage of the global average. Other countries voluntarily take on “no lose” targets. 
Grandfathering: Rose et al., 1998 Reduction obligations based on current emissions. 
Global preference score compromise: Müller, 1999 Countries voice preference for either per capita allocation or allocation based on current national emissions.  
Historical responsibility – the Brazilian proposal: UNFCCC, 1997b; Rose et al., 1998; Meira Filho and Gonzales Miguez, 2000; Pinguelli Rosa et al., 2001; den Elzen and Schaeffer, 2002; La Rovere et al., 2002; Andronova and Schlesinger, 2004; Pinguelli et al., 2004; Trudinger and Enting, 2005; den Elzen and Lucas, 2005; den Elzen et al., 2005c; Höhne and Blok, 2005; Rive et al., 2006  Reduction obligations between countries are differentiated in proportion to those countries’ relative share of responsibility for climate change – i.e. their contribution to the increase of global-average surface temperature over a certain period of time.  
Ability to pay: Jacoby et al., 1998; Lecoq and Crassous, 2003 Participation above welfare threshold. Emission reductions as a function of ability to pay (welfare). 
Equal mitigation costs: Rose et al., 1998; Babiker and Eckhaus, 2002 Reduction obligations between countries are differentiated so that all participating countries have the same welfare loss. 
Triptych: Blok et al., 1997; den Elzen and Berk, 2004; Höhne et al., 2005 National emission targets based on sectoral considerations: Electricity production and industrial production grow with equal efficiency improvements across all countries. “Domestic” sectors converge to an equal per-capita level. National sectoral aggregate levels are then adopted. 
Multi-sector convergence: Sijm et al., 2001 Per-capita emission allowances of seven sectors converge to equal levels based on reduction opportunities in these sectors. Countries participate only when they exceed per capita threshold. 
Multi-criteria: Ringius et al., 1998; Helm and Simonis, 2001; Ringius et al., 2002 Emission reduction obligations based on a formula that includes several variables, such as population, GDP and others. 

Table 13.2 continued

Name (reference) Description 
National emission targets and emission trading 

National emission targets and emissions trading



types of



for some


Alternative types of emission targets for some countries 
Dynamic targets: Hargrave et al., 1998; Lutter, 2000; Müller et al., 2001; Bouille and Girardin, 2002; Chan-Woo, 2002; Lisowski, 2002; Ellerman and Wing, 2003; Höhne et al., 2003; Müller and Müller-Fürstenberger, 2003; Jotzo and Pezzey, 2005; Philibert, 2005b; Pizer, 2005b; Kolstad, 2006 Targets are expressed as dynamic variables – including as a function of the GDP (“intensity targets”) or variables of physical production (e.g. emissions per tonne of steel produced).  
Dual targets, target range or target corridor: Philibert and Pershing, 2001; Kim and Baumert, 2002 Two emission targets are defined: (1) a lower “selling target” that allows allowance sales if national emissions fall below a certain level; (2) a higher “buying target” that requires the purchase of allowances if a certain level is exceeded. 
Dual intensity targets: Kim and Baumert, 2002 A combination of intensity targets and dual targets.  
“No lose”, “non-binding”, one-way targets: Philibert, 2000  Emission rights can be sold if the target is reached, while no additional emission rights would have to be bought if target is not met. Allocations are made at a BAU level or at a level below BAU. Structure offers incentives to participate for countries not prepared to take on full commitments but still interested in joining the global trading regime.  
Growth targets, headroom allowances, premium allocation: Frankel, 1999; Stewart and Wiener, 2001; Viguier, 2004 Participation of major developing countries is encouraged by unambitious allocations relative to their likely BAU emissions. To ensure benefit to the atmosphere, a fraction of each permit sold can be banked and definitely removed. 
Action targets: Goldberg and Baumert, 2004 A commitment to reduce GHG emission levels below projected emissions by an agreed date through “actions” taken domestically, or through the purchases of allowances. 
Flexible binding targets: Murase, 2005 A framework for reaching emission targets modelled after the WTO/GATT (World Trade Organization/General Agreement on Tariffs and Trade) scheme for tariff and non-tariff barriers; targets negotiated through rounds of negotiations.  


to the emission


system or





Modifications to the emission trading system or alternative emission trading system 
Price cap, safety valve or hybrid trading system: Pizer, 1999; Pizer, 2002; Jacoby and Ellerman, 2004. Hybrid between a tax and emission trading: after the initial allocation, an unlimited amount of additional allowances are sold at a fixed price. 
Buyer liability: Victor, 2001b If the seller of a permit did not reduce its emissions as promised, the buyer could not claim the emission credit. Enforcement is more reliable as buyers deal with developed countries with more robust legal procedures. 
Domestic hybrid trading schemes: McKibbin and Wilcoxen, 1997; McKibbin and Wilcoxen, 2002 Two kinds of emissions permits valid only within the country of origin. (1) long-term permits entitle the permit owner to emit 1 tC every year for a long period; permits are distributed once. (2) Annual permits allow 1 tC to be emitted in a single year. An unlimited number of these permits are given out at a fixed price (price cap). Compliance is based on either unit. 
Allowance purchase fund: Bradford, 2004 Countries contribute to an international fund that buys/retires emission reduction units. Countries can sell reductions below their BAU levels. 
Long-term permits: Peck and Teisberg, 2003 Long-term permits could be used once at any time between 2010 and 2070. Depending on the time of emission they are depreciated 1% annually for atmospheric decay of CO2. The permit would allow the emission of 1 tC in 2070, 1.01 tC in 2069 and 1.0160 (1.71) tons in 2010. 

Table 13.2 continued

Name (reference) Description 



Sectoral approaches 
Sector Clean Development Mechanism, sector Crediting Mechanism : Philibert and Pershing, 2001; Samaniego and Figueres, 2002; Bosi and Ellis, 2005; Ellis and Baron, 2005; Sterk and Wittneben, 2005  Sectoral crediting schemes based on emission reductions below a baseline. Excess allowances can be sold.  
Sector pledge approach: Schmidt et al., 2006 Annex I countries have emission targets, with the ten highest-emitting developing countries pledging to meet voluntary, “no-lose” GHG emissions targets in the electricity and major industrial sectors. Targets are differentiated, based upon national circumstances, and sector-specific energy-intensity benchmarks are developed by experts and supported through a Technology Finance and Assistance Package.  
Caps for multinational cooperation: Sussman et al., 2004 A cap/and trade system associated with the operations of associated enterprises in developing and developed countries. 
Carbon stock protocol: WBGU, 2003 A protocol for the protection of carbon stocks based on a worldwide system of “non-utilization obligations” to share the costs of the non-degrading use of carbon stocks among all states.  
“Non-binding” targets for tropical deforestationa: Persson and Azar, 2004 Non-binding commitments for emissions from deforestation under which reduced rates of deforestation could generate emissions allowances.  




Policies and measures 
Carbon emission tax: Cooper, 1998; Nordhaus, 1998; Cooper, 2001; Nordhaus, 2001; Newell and Pizer, 2003 All countries agree to a common, international GHG emission tax; several of the proposals suggest beginning with a carbon tax limited to emissions from fossil fuel combustion. 
Dual track: Kameyama, 2003 Countries choose either non-legally binding emission targets based on a list of policies and measures or legally-binding emission caps allowing international emissions trading. 
Climate “Marshall Plan”: Schelling, 1997, 2002 Financial contributions from developed countries support climate friendly development; similar in scale and oversight to the Marshall Plan. 


Technology research and development: Edmonds and Wise, 1999; Barrett, 2003 Enhanced coordinated technology research and development. 
Energy efficiency standards: Barrett, 2003; Ninomiya, 2003 International agreement on energy efficiency standards for energy-intensive industries. 
Backstop technology protocol: Edmonds and Wise, 1998 New power plants installed after 2020 must be carbon neutral. New synthetic fuels plants must capture CO2. Non-Annex I countries participate upon reaching Annex I average GDP in 2020. 
Technology prizes for climate change mitigation: Newell and Wilson, 2005 Incentive or inducement prizes targeted at applied research, development and demonstration. 




Development-oriented actions 
Sustainable development policies and measures: Winkler et al., 2002b; Baumert et al., 2005b  Countries integrate policies and measures to reduce GHG emissions into development plans (e.g. developing rural electrification programmes based on renewable energy, or mass transit systems in placed of individual cars). 
Human development goals with low emissions: Pan, 2005 Elements include: identification of development goals/basic human needs; voluntary commitments to low carbon paths via no-regret emission reductions in developing countries conditional to financing and obligatory discouragement of luxurious emissions; reviews of goals and commitments; an international tax on carbon. 

Table 13.2 continued.

Name (reference) Description 


UNFCCC impact response instrument: Müller, 2002 A new “impact response instrument” under the auspices of the UNFCCC for disaster relief, rehabilitation and recovery. 
Insurance for adaptation; funded by emission trading surcharge: Jaeger, 2003 A portion of the receipts from sales of emissions permits would be used to finance insurance pools. 


Greening investment flows: Sussman and Helme, 2004 Investments through Export Credit Agencies are conditional on projects that are “climate friendly”. 
Quantitative finance commitments: Dasgupta and Kelkar, 2003 Annex I countries take on quantitative financial commitments – e.g. expressed as a percentage of the GDP – in addition to emission reduction targets. 






Negotiation process and treaty structure 
Bottom-up or multi-facet approach, pledge (with review) and review: Reinstein, 2004; Yamaguchi and Sekine, 2006 Each country creates its own initial proposal relating to what it might be able to commit to. Individual actions accumulate one by one. The collective effect of proposals is periodically reviewed for adequacy and – if necessary – additional rounds of proposals are undertaken. 
Portfolio approach: Benedick, 2001 A portfolio including: emission reduction policies, government research/development, technology standards and technology transfer. 
A flexible framework: PEW, 2005  A portfolio including: aspirational long-term goals, adaptation, targets, trading, policies, and technology cooperation.  
Orchestra of treaties: Sugiyama et al., 2003 A system of separate treaties among like-minded countries (emission markets, zero emission technology, climate-wise development) and among all parties to UNFCCC (monitoring, information, funding). 
Case study approach: Hahn, 1998 Multiple case studies of coordinated measures, emissions tax, tradable emission permits and a hybrid system in industrialized countries to learn by doing. 
Note: a There is some potential conflict with the terminology here: “non-binding” targets may be interpreted by some as restricting the capacity of countries to trade as they do not necessarily set up caps that impose prices and thus established tradable commodities. Source: Earlier overviews by Bodansky, 2004; Kameyama, 2004; Philibert, 2005a