The US is back in Paris Climate Agreement!
A Summary of the Paris Climate Agreement
The Paris Climate Agreement was reached on December 12, 2015. This agreement was achieved after a landmark negotiation between 197 countries that are part of the United Nations Framework Convention on Climate Change (UNFCCC) at their annual gathering referred to as the Conference of the Parties (COP) 21. The agreement was later ratified, or formally adopted, by 190 countries. 7 countries - Iran, Turkey, Iraq, Eritrea, Libya, South Sudan, and Yemen - have never ratified the agreement.
The agreement pledges to keep global warming well below 2C compared with pre industrial levels, with an ambition of limiting this rise to 1.5C. Global temperatures have already risen 1.2C (Carbon Brief).
A key feature of the Paris Agreement is that it is “bottom up” in its approach. Unlike previous attempts to negotiate the agreement where global targets were set and divided up amongst countries to achieve, the Paris Agreement allowed countries to submit realistic targets that they had determined on their own. These are referred to as Nationally Determined Contributions (NDCs).
“The Paris Agreement works on a 5-year cycle of increasingly ambitious climate action carried out by countries.” (UNFCCC) In practice that means that every 5 years countries resubmit their NDCs with the goal of them becoming increasingly more ambitious over time.
The Paris Agreement is a legally binding treaty, but it actually has a mix of legally binding and non-binding provisions. It is an agreement under international law binding on the parties but it has no legal enforcement mechanisms for countries that do not meet their promised contributions (NDCs).
The US in the Agreement
The United States has always been a crucial participant in the Paris agreement and its negotiation process. This is because the USA is the world’s second largest emitter of CO2 after China, and it is the world’s largest economy. It is also the largest historic emitter, meaning over time it has admitted the most CO2 total.
Obama
Arriving at the Paris Agreement took years of negotiation and diplomacy. One of the most consequential moments in that process was in 2014 when the US and China struck a deal to jointly implement sweeping climate action. Most experts believe that without that commitment from the world’s two largest emitters, the agreement would not have been possible.
The United States signed the Paris Agreement in April 2016, and accepted it by Executive Order in September 2016. The agreement came into effect on November 4, 2016. Their commitment (NDC) at that time was to reduce greenhouse gas emissions by 28 per cent by 2025 compared with 2005 levels. President Obama also committed $3B to the Green Climate Fund.
Trump
The Paris Agreement has a provision, Article 28, that allows parties to withdraw from the agreement after sending notice. However, there were two crucial timing items stipulated in the agreement:
that notice could be given no earlier than three years after the agreement goes into force in that country.
that withdrawal is effective one year after notice is given.
Donald Trump was elected President of the United States on November 8, 2016, just 4 days after the Paris Agreement came into effect. Because of the timeline restrictions in the exit process, it was not possible for Trump to withdraw before November 4, 2019, three years after the US became a party to the agreement. Trump did announce his intention to withdraw on June 1, 2019 and notice was given on November 4, 2019. The withdrawal came into effect on November 4, 2020, the day after the presidential election that would see him removed from office. Until that date, the US was required to meet its obligations to the Agreement, including reporting on emissions to the UN. In total, the US spent 107 days outside the Paris Agreement. It is also worth noting that despite Trump’s withdrawal from the agreement, a large number of states, cities and businesses reaffirmed their commitment to combatting climate change, leading to more local-level action.
Biden
Joe Biden was elected as the American president in the election that took place November 3, 2020. Joe Biden stated his intention to rejoin the Paris Agreement his first day in office. And true to his word, he signed an Executive Order to rejoin on January 20, 2021. There is a 30 day instatement period, so the US became an official party to the agreement again on February 19, 2021. Biden has also pledged to release a comprehensive emissions reduction plan on Earth Day (April 22) 2021. It is not known what will be in that plan but during his campaign promised net zero emissions “no later than” 2050 and to decarbonize US power generation by 2035. He has also said that he will plan a summit for world leaders to ramp up action on the Paris Agreement, also on Earth Day 2021.
Why it Matters?
The US rejoining the Paris Agreement is significant on many levels, I will attempt to explore a number of them here.
Leadership - by far the most important contribution the US makes to the Paris Agreement is its leadership in multilateralism. Being a world superpower, the second largest emitter, and the world’s largest economy, the US’s actions have ripple effects diplomatically. When Trump withdrew from the Agreement, many saw it as the dilution of global ambition to tackle climate change. There was a great deal of concern that other countries would use the US’s withdrawal as an excuse to not take action themselves. With the US hinting the release of a more ambitious climate plan, and China’s recent commitment of net-zero by 2060, the climate community is hopeful that India, the world’s second most populous country and third highest emitter, and other countries will follow suit.
Common But Differentiated Responsibility (CBDR) - CBDR is a crucial principle in the Paris Agreement that establishes that while all countries are responsible for addressing climate change, they are not equally responsible due to their historic contributions to the problem, as well as there current ability to address the issue. In other words, those who contributed more to the problem bear more responsibility in addressing it. This was a fundamental point for developing countries who are experiencing more of the impacts of climate change but did not cause the issue and do not have the resources to address it. The US as the world’s largest historic emitter holds a great deal of responsibility according to the CBDR principle so having them a party to the agreement is very important.
Climate Finance - related to the previous point, rich countries who historically emitted more are responsible for footing the majority of the bill for the Green Climate Fund to enable poorer countries the means they need to address it. Only $1B of Obama’s $3B commitment was ever paid. Environmental organizations are now pressing Biden to increase the commitment to at least $8B (Fortune).
Investment Signal - finally, the US’s economic strength means its actions have ripple effects in the global economic system. Commitment to a net-zero strategy would be an extremely important signal for companies and investors - both in that they need to take the threat of climate change seriously and that climate-compliant areas of business will be important opportunities in the future.
Why 2021 is Significant?
As mentioned previously, the Paris Agreement operates on a 5-year cycle for enhanced ambition. The agreement was adopted in 2015 and therefore, 2020 was the first year for new, more ambitious NDC submissions. Unfortunately, COP26 Glasgow was delayed due to COVID and the timeline was pushed; these new commitments will now be reviewed in November 2021. Given the US’s important leadership in multilateral circles, it is perfect timing to have them back in the agreement to encourage other countries to be more ambitious in their action and to lead by example. To date, only 43 of the 190 parties to the agreement have submitted their new commitments. In addition, COP26 is where a number of crucial implementation issues will be agreed upon, such as a carbon markets mechanism, funding for loss and damage, and climate finance. The US’s participation in the development of these elements will be important for longterm buy-in and implementation.
And finally, the impacts of climate change are becoming more and more common and costly. The United States had 22 weather-related disasters in 2020, costing at least $1 billion each just in the last year.
We need action and leadership now more than ever.
Keep Learning
Here are a few great resources for further reading and learning:
Joe Biden Announcement of US Rejoining Climate Agreement video (2021, New York Times)
What is the Paris Climate Agreement (2021, UNFCCC)
Paris Agreement full text (2015, United Nations)
What is the Paris climate agreement and why is the US rejoining? (2021, BBC)
Climate Target Update Tracker (2021, Climate Action Tracker)
What is COP26, who will attend it and why does it matter? (2021, Energy and Climate Intelligence Unit)