Identifier
Created
Classification
Origin
06PARIS7861
2006-12-20 13:56:00
UNCLASSIFIED
Embassy Paris
Cable title:
FLURRY OF FRENCH CLIMATE CHANGE INITIATIVES
how-toVZCZCXRO0103 RR RUEHHM RUEHLN RUEHMA RUEHPB DE RUEHFR #7861/01 3541356 ZNR UUUUU ZZH R 201356Z DEC 06 FM AMEMBASSY PARIS TO RUEHC/SECSTATE WASHDC 3885 INFO RHEHAAA/WHITE HOUSE WASHDC RHEBAAA/DEPT OF ENERGY WASHINGTON DC RUEAEPA/EPA WASHDC RUEHZN/EST COLLECTIVE RUEHBS/USEU BRUSSELS 1871 RUEHMRE/AMCONSUL MARSEILLE 1471 RUEHSR/AMCONSUL STRASBOURG 0278
UNCLAS SECTION 01 OF 03 PARIS 007861
SIPDIS
SIPDIS
STATE FOR OES/GC, EUR/WE;
WHITE HOUSE FOR CEQ;
DOE FOR EIA, INTL AFFAIRS;
EPA FOR INTERNATIONAL;
USEU FOR SMITHAM;
EMBASSIES FOR SCIENCE OFFICERS
E.O. 12958: N/A
TAGS: SENV ENRG FR
SUBJECT: FLURRY OF FRENCH CLIMATE CHANGE INITIATIVES
REF: (A) Paris 6969 (B) Paris 7208
PARIS 00007861 001.2 OF 003
NOT FOR INTERNET DISTRIBUTION.
UNCLAS SECTION 01 OF 03 PARIS 007861
SIPDIS
SIPDIS
STATE FOR OES/GC, EUR/WE;
WHITE HOUSE FOR CEQ;
DOE FOR EIA, INTL AFFAIRS;
EPA FOR INTERNATIONAL;
USEU FOR SMITHAM;
EMBASSIES FOR SCIENCE OFFICERS
E.O. 12958: N/A
TAGS: SENV ENRG FR
SUBJECT: FLURRY OF FRENCH CLIMATE CHANGE INITIATIVES
REF: (A) Paris 6969 (B) Paris 7208
PARIS 00007861 001.2 OF 003
NOT FOR INTERNET DISTRIBUTION.
1. Summary: To reach Kyoto Protocol commitments, the government of
France recently announced:
-- Its updated 'National Plan' to fight climate change (PNLCC) aimed
at saving an extra 6 to 8 million tons equivalent CO2 per year
(MtCO2) for the period 2008-2010.
-- In the context of the EU Emissions Trading Scheme (ETS),a
stricter CO2 plan (132 MtCO2 instead of 155 MtCO2) for capping
emissions in the industrial sector during the period 2008-2012 will
be resubmitted to the European Commission before end-2006.
-- A pioneer program, entitled 'Climate and Domestic Offset
Projects,' jointly presented by the Finance and Ecology Ministries,
aims to stimulate projects reducing GHG emissions in sectors not
covered by the ETS by providing financial remuneration for voluntary
emissions reduction.
End summary.
--------------
Kyoto goals: France on track, so far...
--------------
2. To comply with the Kyoto Protocol (KP) requirements, France
agreed to stabilize its GHG emissions at 1990 levels (567.1 MtCO2)
by 2012. France emits about 1.2 percent of GHG worldwide while it
represents about 5 percent of world GDP (UN 2004 data). According
to recent figures, total French emissions for 2004 approximated
562.6 MteCO2, 0.8 percent under the 1990 level (detailed figures per
sector in para 14). Between 1999 and 2004, average French emissions
remained 2 percent below the 1990 emission level, with economic
growth totaling 25 percent excluding inflation during the same five
year period.
--------------
New National Plan: Buildings and Transport
--------------
3. In 2000, French authorities adopted a national climate change
control program, known as PNLCC. This plan was revised in 2004, and
provides for an additional annual reduction of 33.5 MtCO2 for the
period 2004-2012. It was prepared in tandem with the establishment
of a national quota allocation program within the ETS scheme.
According to GOF reports based on energy models, France will succeed
in reaching its Kyoto objectives. The updated, but not overly
ambitious, plan released in November 2006, aimed at assuring
"France's (emissions) position, taking into account possible changes
in the energy sector." The expected gain is an extra 6-8 MtCO2/year
for the period 2008-2012.
4. On the transport side, major measures are designed to improve
urban mobility while reducing emissions. The GOF seeks to develop
alternatives to road transportation (e.g. urban tram systems),and
at the same time accelerate the development and deployment of
biofuels. The Transport Ministry is studying/(repeat studying only
at this point) the possibility of introducing urban tolls (so far
forbidden in France) and a truck tax on vehicles to "re-adjust" road
transportation in environmentally sensitive areas (e.g. crossing of
the Alps).
5. The updated plan includes regulatory measures and fiscal
incentives to exploit emission savings in older commercial and
residential buildings. The tax incentive for investments
contributing to energy efficiency in buildings will be increased
from 300 million euros in 2006 to 1 billion euros in 2007. From
2007, significant renovations in buildings more than 1000 square
meters will need to meet minimum energy requirements.
--------------
Ratcheting down on industrial polluters...
--------------
6. The revised PNLCC also includes measures to tighten pollution
taxes with a 10 percent increase in taxation of industrial and air
PARIS 00007861 002.2 OF 003
transport pollution and the creation, in 2007, of a coal tax. Coal
powered energy (of which there is very little in France) will be
subject to a levy of 1.19 euros per megawatt hour of energy
consumption. Industrial groups that already benefit form an
"environmental (exemption) certification" will not be affected by
these new taxes.
--------------
The 'other' category...
--------------
7. France also intends to examine with European partners the
possibility of imposing a "carbon tax" on imports of industrial
goods from countries not part of international efforts (Kyoto
Protocol-like efforts) to cut greenhouse emissions after 2012.
Senior French officials have said the GOF plans to submit a proposal
for study to the EU and other European countries along these lines
in early 2007. (This topic has been discussed in separate Embassy
reporting. See, e.g., Paris 7584.) France further wishes that the
EU study the possibility of a CO2 quota scheme for goods
transportation and plans to provide Brussels with a memorandum
outlining its vision before the end of March 2007.
--------------
EU Emissions-Trading: Paris lowers quota plan
--------------
8. Launched in 2005, the ETS is the cornerstone of the EU's efforts
to fight climate change and meet KP goals. The ETS fixed an opening
price for carbon and outlines how much CO2 industries in each EU
member covered by the scheme can emit. It includes two phases:
2005-2007 and 2008-2012. Some 1,100 French facilities - out of
11,400 in Europe - belonging to the most energy-consuming industrial
sectors (refining, electric power, cement, steel, paper, etc.) are
targeted. They represent roughly one-fourth of France's total GHG
emissions. (Note: Authorized emissions for France under the first
Emissions Trading Scheme period are 156 MtCO2/year; France's actual
2005 emissions in the covered sectors were 131 MtCO2.)
9. Claiming that national governments did not press hard enough in
the first phase (as they handed out more permits than needed, for
example, so that the price of emission permits plummeted in 2006),
the European Commission recently announced that it would not accept
overly generous CO2 plans for the second phase. Accordingly, Paris
withdrew its initial proposal of 155 MtCO2/year in late November
given Commission indications that it would be rejected as too weak.
(Note: France is not the only "bad pupil:" the Commission has
examined 10 proposals thus far for the period 2008-2012, accepting
only the UK's without insisting on changes. End note.) France told
Brussels on December 13 that its amended National Allocation Plan
proposal to the Commission would be 132.8 MtCO2/year, a substantial
proposed reduction in GHG emissions in the covered sectors. France
also decided not to permit the transfer of quotas not used during
the first period to the second period, a decision highlighted by the
Ecology Ministry as a significant gesture for environmental
interests.
-------------- --------------
France pioneers domestic offset projects to fight CO2
-------------- --------------
10. France also has launched a new initiative, outside the PNLCC,
to fight GHG emissions at the domestic level in sectors not covered
by the ETS. These sectors, such as transport, agriculture,
buildings, and small industries, are responsible for the majority of
France's GHG emissions, often characterized as "diffuse" emissions.
The concept of domestic offset projects (DOPs) consists in applying
at the national level the logic of the joint implementation
mechanism defined for international projects under the KP by
crediting GHG emission reductions for projects conducted by smaller
emitters within France.
11. According to the government, this initiative, a first in
Europe, can close gaps between other emissions reduction policies
and motivate larger numbers of actors (often at local levels) in
many sectors not covered by the ETS program. Jointly presented by
the Finance/Industry and Ecology Ministries, this proposal has
received positive feedback from environmental groups. To be
recognized as DOPs, however, these projects must demonstrate that
PARIS 00007861 003.2 OF 003
they would not have occurred within existing incentive measures
("additionality" criteria, sometimes difficult to assess) and they
must lead to emission reductions which can be posted to the national
GHG inventory.
12. This initiative will be placed under the supervision of the
'Caisse des Depots et Consignations' (CDC),a state-owned financial
institution that performs public-interest missions on behalf of
France's central, regional, and local governments. CDC will be
committed to buy the CO2 "permits" corresponding to avoided
emissions (1 permit = 1 ton GHG) at a price determined in advance.
Pooling of projects - notably in the agricultural sector - will be
encouraged and CDC will help aggregate individual initiatives and
handle administrative procedures. CDC has agreed to purchase up to
5 MtCO2 for the period 2008-2012, which should further help France
to reach its overall KP goal under the EC scheme. The first call
for projects is expected to take place in early 2007. We expect the
implementation of this new system to be closely monitored by other
EU members.
13. Comment: As France moves deeper into its presidential election
season, there is more and more discussion by government figures and
presidential hopefuls about the environment, especially climate
change. It is not all 'hot air.' Given the French electorate's
interest in climate change, we expect the trend of generating new
environmental initiatives to continue for the foreseeable future.
End Comment.
--------------
France's GHG emissions: Evolution 1990-2004
--------------
14. Breakdown per sector:
Sector Evolution % total % total
1990-2004 emissions emissions
1990 2004
-------------- --------------
Transport + 22.7% 21.4% 26.5%
Building + 22.3% 15.7% 19.3%
Manufacturing - 21.6% 25.2% 19.9%
Industry
Agriculture/ - 10.5% 20.9% 18.9%
Forestry
Energy Industry - 9.1% 13.9% 12.8%
Waste Sector - 9.5% 2.8% 2.6%
HOFMANN
SIPDIS
SIPDIS
STATE FOR OES/GC, EUR/WE;
WHITE HOUSE FOR CEQ;
DOE FOR EIA, INTL AFFAIRS;
EPA FOR INTERNATIONAL;
USEU FOR SMITHAM;
EMBASSIES FOR SCIENCE OFFICERS
E.O. 12958: N/A
TAGS: SENV ENRG FR
SUBJECT: FLURRY OF FRENCH CLIMATE CHANGE INITIATIVES
REF: (A) Paris 6969 (B) Paris 7208
PARIS 00007861 001.2 OF 003
NOT FOR INTERNET DISTRIBUTION.
1. Summary: To reach Kyoto Protocol commitments, the government of
France recently announced:
-- Its updated 'National Plan' to fight climate change (PNLCC) aimed
at saving an extra 6 to 8 million tons equivalent CO2 per year
(MtCO2) for the period 2008-2010.
-- In the context of the EU Emissions Trading Scheme (ETS),a
stricter CO2 plan (132 MtCO2 instead of 155 MtCO2) for capping
emissions in the industrial sector during the period 2008-2012 will
be resubmitted to the European Commission before end-2006.
-- A pioneer program, entitled 'Climate and Domestic Offset
Projects,' jointly presented by the Finance and Ecology Ministries,
aims to stimulate projects reducing GHG emissions in sectors not
covered by the ETS by providing financial remuneration for voluntary
emissions reduction.
End summary.
--------------
Kyoto goals: France on track, so far...
--------------
2. To comply with the Kyoto Protocol (KP) requirements, France
agreed to stabilize its GHG emissions at 1990 levels (567.1 MtCO2)
by 2012. France emits about 1.2 percent of GHG worldwide while it
represents about 5 percent of world GDP (UN 2004 data). According
to recent figures, total French emissions for 2004 approximated
562.6 MteCO2, 0.8 percent under the 1990 level (detailed figures per
sector in para 14). Between 1999 and 2004, average French emissions
remained 2 percent below the 1990 emission level, with economic
growth totaling 25 percent excluding inflation during the same five
year period.
--------------
New National Plan: Buildings and Transport
--------------
3. In 2000, French authorities adopted a national climate change
control program, known as PNLCC. This plan was revised in 2004, and
provides for an additional annual reduction of 33.5 MtCO2 for the
period 2004-2012. It was prepared in tandem with the establishment
of a national quota allocation program within the ETS scheme.
According to GOF reports based on energy models, France will succeed
in reaching its Kyoto objectives. The updated, but not overly
ambitious, plan released in November 2006, aimed at assuring
"France's (emissions) position, taking into account possible changes
in the energy sector." The expected gain is an extra 6-8 MtCO2/year
for the period 2008-2012.
4. On the transport side, major measures are designed to improve
urban mobility while reducing emissions. The GOF seeks to develop
alternatives to road transportation (e.g. urban tram systems),and
at the same time accelerate the development and deployment of
biofuels. The Transport Ministry is studying/(repeat studying only
at this point) the possibility of introducing urban tolls (so far
forbidden in France) and a truck tax on vehicles to "re-adjust" road
transportation in environmentally sensitive areas (e.g. crossing of
the Alps).
5. The updated plan includes regulatory measures and fiscal
incentives to exploit emission savings in older commercial and
residential buildings. The tax incentive for investments
contributing to energy efficiency in buildings will be increased
from 300 million euros in 2006 to 1 billion euros in 2007. From
2007, significant renovations in buildings more than 1000 square
meters will need to meet minimum energy requirements.
--------------
Ratcheting down on industrial polluters...
--------------
6. The revised PNLCC also includes measures to tighten pollution
taxes with a 10 percent increase in taxation of industrial and air
PARIS 00007861 002.2 OF 003
transport pollution and the creation, in 2007, of a coal tax. Coal
powered energy (of which there is very little in France) will be
subject to a levy of 1.19 euros per megawatt hour of energy
consumption. Industrial groups that already benefit form an
"environmental (exemption) certification" will not be affected by
these new taxes.
--------------
The 'other' category...
--------------
7. France also intends to examine with European partners the
possibility of imposing a "carbon tax" on imports of industrial
goods from countries not part of international efforts (Kyoto
Protocol-like efforts) to cut greenhouse emissions after 2012.
Senior French officials have said the GOF plans to submit a proposal
for study to the EU and other European countries along these lines
in early 2007. (This topic has been discussed in separate Embassy
reporting. See, e.g., Paris 7584.) France further wishes that the
EU study the possibility of a CO2 quota scheme for goods
transportation and plans to provide Brussels with a memorandum
outlining its vision before the end of March 2007.
--------------
EU Emissions-Trading: Paris lowers quota plan
--------------
8. Launched in 2005, the ETS is the cornerstone of the EU's efforts
to fight climate change and meet KP goals. The ETS fixed an opening
price for carbon and outlines how much CO2 industries in each EU
member covered by the scheme can emit. It includes two phases:
2005-2007 and 2008-2012. Some 1,100 French facilities - out of
11,400 in Europe - belonging to the most energy-consuming industrial
sectors (refining, electric power, cement, steel, paper, etc.) are
targeted. They represent roughly one-fourth of France's total GHG
emissions. (Note: Authorized emissions for France under the first
Emissions Trading Scheme period are 156 MtCO2/year; France's actual
2005 emissions in the covered sectors were 131 MtCO2.)
9. Claiming that national governments did not press hard enough in
the first phase (as they handed out more permits than needed, for
example, so that the price of emission permits plummeted in 2006),
the European Commission recently announced that it would not accept
overly generous CO2 plans for the second phase. Accordingly, Paris
withdrew its initial proposal of 155 MtCO2/year in late November
given Commission indications that it would be rejected as too weak.
(Note: France is not the only "bad pupil:" the Commission has
examined 10 proposals thus far for the period 2008-2012, accepting
only the UK's without insisting on changes. End note.) France told
Brussels on December 13 that its amended National Allocation Plan
proposal to the Commission would be 132.8 MtCO2/year, a substantial
proposed reduction in GHG emissions in the covered sectors. France
also decided not to permit the transfer of quotas not used during
the first period to the second period, a decision highlighted by the
Ecology Ministry as a significant gesture for environmental
interests.
-------------- --------------
France pioneers domestic offset projects to fight CO2
-------------- --------------
10. France also has launched a new initiative, outside the PNLCC,
to fight GHG emissions at the domestic level in sectors not covered
by the ETS. These sectors, such as transport, agriculture,
buildings, and small industries, are responsible for the majority of
France's GHG emissions, often characterized as "diffuse" emissions.
The concept of domestic offset projects (DOPs) consists in applying
at the national level the logic of the joint implementation
mechanism defined for international projects under the KP by
crediting GHG emission reductions for projects conducted by smaller
emitters within France.
11. According to the government, this initiative, a first in
Europe, can close gaps between other emissions reduction policies
and motivate larger numbers of actors (often at local levels) in
many sectors not covered by the ETS program. Jointly presented by
the Finance/Industry and Ecology Ministries, this proposal has
received positive feedback from environmental groups. To be
recognized as DOPs, however, these projects must demonstrate that
PARIS 00007861 003.2 OF 003
they would not have occurred within existing incentive measures
("additionality" criteria, sometimes difficult to assess) and they
must lead to emission reductions which can be posted to the national
GHG inventory.
12. This initiative will be placed under the supervision of the
'Caisse des Depots et Consignations' (CDC),a state-owned financial
institution that performs public-interest missions on behalf of
France's central, regional, and local governments. CDC will be
committed to buy the CO2 "permits" corresponding to avoided
emissions (1 permit = 1 ton GHG) at a price determined in advance.
Pooling of projects - notably in the agricultural sector - will be
encouraged and CDC will help aggregate individual initiatives and
handle administrative procedures. CDC has agreed to purchase up to
5 MtCO2 for the period 2008-2012, which should further help France
to reach its overall KP goal under the EC scheme. The first call
for projects is expected to take place in early 2007. We expect the
implementation of this new system to be closely monitored by other
EU members.
13. Comment: As France moves deeper into its presidential election
season, there is more and more discussion by government figures and
presidential hopefuls about the environment, especially climate
change. It is not all 'hot air.' Given the French electorate's
interest in climate change, we expect the trend of generating new
environmental initiatives to continue for the foreseeable future.
End Comment.
--------------
France's GHG emissions: Evolution 1990-2004
--------------
14. Breakdown per sector:
Sector Evolution % total % total
1990-2004 emissions emissions
1990 2004
-------------- --------------
Transport + 22.7% 21.4% 26.5%
Building + 22.3% 15.7% 19.3%
Manufacturing - 21.6% 25.2% 19.9%
Industry
Agriculture/ - 10.5% 20.9% 18.9%
Forestry
Energy Industry - 9.1% 13.9% 12.8%
Waste Sector - 9.5% 2.8% 2.6%
HOFMANN