The Kyoto Protocol: Hot air

The Kyoto Protocol: “Hot air” for Russia?

The Kyoto Protocol sets the carbon emission targets for 2008-2012 for the major emitting countries. Several former Soviet countries have emissions quotas that appear to be in excess of their anticipated emissions as a result of economic downturn. This excess is sometimes referred to as ”hot air”, and could, in principle, be traded with other countries. The “hot air” estimates range from 150 to ...

The Kyoto protocol: just a lot of hot air.

Hot air in Kyoto, cold air in The Hague—the failure of global climate negotiations

Why did the climate negotiations in The Hague fail? Our contribution is to argue that the conflict between the European Union (EU) and the United States (US) stems mainly from disagreement on the cost issue. We argue that the three main concerns promoted by the EU in The Hague. First, a 50% national emission ceiling (the supplementarity principle), second the use of carbon sinks, and third an i...

Trading hot air : the influence of permit allocation rules , market power and the US withdrawal from the Kyoto Protocol

After the conferences in Bonn and Marrakech it is likely that international emission trading will be realized in the near future. Major influences on the permit market are the institutional detail, the participation structure and the treatment of hot air. Different scenarios do not only differ in their implications for the demand and supply of permits and thus the permit price, but also in thei...

Hot Air as an Implicit Side Payment Arrangement : Could a Hot Air Provision have Saved the Kyoto - Agreement ?

The purpose of this paper is to analyse whether the presence of Hot Air trading jeopardizes the environmental target of an international environmental agreement. We argue that Hot Air can be used as an implicit side-payment mechanism to actually bring about higher environmental protection compared to the situation without the trade option. We point to the existence of a fundamental trade-off be...