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Summary of Proceedings:
Energy and Environment Ministerial Roundtable

London, March 16, 2005

See also
Press release, March 15, 2005
Gordon Brown's keynote address, March 15, 2005

Ministers from 20 countries and representatives from international organisations, business and non-governmental organisations participated in the Energy and Environment Ministerial Roundtable held in London on 15-16 March 2005.

This innovative event brought together ministers with responsibility for energy, economic and environmental issues from both developed and developing countries to consider the challenges and opportunities for investment in sustainable and secure energy systems in a lower carbon world.

It was clear that despite different national circumstances, Ministers shared many common goals of energy and environment policy, including

In his keynote speech, the Chancellor of the Exchequer, Gordon Brown, said

"If our economies are to flourish, if global poverty is to be banished, and if the well-being of the world's people enhanced – not just in this generation but in succeeding generations – we must make sure we take care of the natural environment and the resources on which our economic activity depends. And we now have evidence that climate change is the most far-reaching – and almost certainly the most threatening – of all the environmental challenges facing us."

Minister Liu Jiang, Vice-Chair of China's National Development and Reform Commission highlighted the importance of climate change impacts on developing countries and the need for cleaner technologies to be deployed as rapidly as possible as developing countries invest in new infrastructure. He said

"Climate change is a challenge faced by every nation in the worldÉOn the premise of safeguarding energy security, developing the economy and improving people's quality of life, China is willing to work with the international community to explore solutions for climate change. Such solutions should not only take into consideration the actual situation of individual nations, but also give full play to the initiative of all nations".

During two days of discussions, Ministers identified common ground across a range of issues, in particular:

- the challenge of transforming our energy systems to create a lower carbon economy, working through markets and creating the policy frameworks to mobilise investment on the scale required;

- the need to diversify energy sources recognising that there is no one silver bullet and that each country needs to find the mix of technologies and energy systems appropriate to its national circumstances;

- the opportunities to encourage innovation, create economic prosperity, employment, enhance competitiveness and improve local environmental quality through strategies to respond to climate change;

- the great potential for further development of renewables, and in particular biomass and biofuels, to combine benefits of reduced greenhouse gas emissions with job creation, rural development, and managing environmental issues including waste and desertification;

- the importance of energy efficiency measures to enhance energy security, reduce emissions of carbon dioxide, improve local air quality and save money, and the need for further measures to realise these benefits – including through public awareness, regulation, codes and standards, labelling, fiscal incentives and including energy efficiency advice in project lending decisions;

- the challenge of reducing emissions from transport, including both vehicles and aviation, through both efficiency and advances in fuel technologies;

- the importance of cleaner power production, for example, raising the efficiency of existing coal-fired power plant and ensuring best available technology is widely deployed;

- preparing the way for step-change technologies including carbon capture and storage and understanding of the need for international cooperation both in research and development in new areas such as hydrogen.

An agenda for action

We began to build an agenda for action in response to the challenge of climate change. This agenda will need to be taken forward in a wide range of contexts – in national policy-making, through international agreements and partnerships – and by a wide range of actors – international institutions, governments, business and civil society.

Clear, long-term national policy frameworks are essential to mobilise investment from the private sector in lower carbon technologies and to avoid locking in emissions-intensive technology where lower-emissions alternatives are available. Many Ministers and business speakers drew attention to the need for policy signals to be "loud, long and legal", and in particular to take account of business investment cycles lasting 5-15 years or longer. A number of countries have established long-term frameworks either at a national or sectoral level. The UK Business Council for Sustainable Energy called for a Sustainable Energy Investment Initiative, to build consensus on the scale and timing of investment needed to meet public policy objectives.

The UN Framework Convention on Climate Change provides a valuable framework for international cooperation on climate change. In addition the Kyoto Protocol has created new flexible mechanisms. The Clean Development Mechanism has considerable potential to create markets, mobilise investment, help with technology transfer and assist sustainable development. Clarity, simplicity, credibility are helpful principles. Areas for exploration under the institutions of the Kyoto Protocol include concerns that the rules on additionality can create a perverse incentive for policy-making and the desire to explore options for effective approaches at a sectoral level, consistent with the rules agreed at Marrakech. We look forward to further discussions on cooperation under the Convention and Protocol at the meetings in Bonn and Montreal later this year.

The Global Environment Facility (GEF) has played a key role in exploring and transferring innovative technologies to developing countries. This is a vital element of our cooperation on climate change and we look forward to a successful fourth replenishment of the GEF.

The creation of regional, national and sub-national Emissions Trading Schemes provides another major instrument to create incentives to mobilise investment in lower carbon technologies. There is scope to consider how Emissions Trading Schemes can be developed, extended and how links should be established between them.

International cooperation also takes place in the context of partnerships. Partnerships provide a valuable and flexible way to bring focus to a particular policy area and facilitate cooperation between governments, business and civil society. These partnerships can be further strengthened, and may be extended to new areas.

A wide range of instruments exist to develop national policy for energy efficiency. Public procurement can be a powerful tool for stimulating markets for new technologies, along with codes and standards, product labelling and consumer awareness. Energy efficiency benchmarking and audits can help to mainstream energy efficiency into business and investment decision-making. These instruments can be scaled up to produce a range of benefits for any country.

More, better and sustained international cooperation can add value in this area, including maintaining dialogue through the Renewable Energy and Energy Efficiency Partnership (REEEP).

Cooperation to reduce emissions from the aviation sector is increasingly necessary. This can be taken forward in the short-term through the EU and the OECD, with the ultimate goal of looking for global solutions.

The Bonn Conference on Renewable Energy provides a strong platform for taking forward action on renewable energy. Successful approaches at national level can be scaled up and shared through various means, including institutions such as the International Energy Agency and partnerships including REEEP and the Mediterranean Renewable Energy Partnership (MEDREP). There is scope for further focused cooperation to overcome barriers to the wider use of biomass and biofuels.

Major investment will be needed to exploit the potential of natural gas in a lower carbon economy will be needed. Creating stable and transparent market frameworks can stimulate private sector investment in gas infrastructure and help to reduce gas flaring and losses from pipelines. More could be done to overcome barriers to the use of liquefied natural gas to provide a cleaner fuel for vehicles.

Considerable scope exists for cost-effective reduction in carbon emissions and increased efficiency in coal-fired power generation, including in the emerging economies. Some of these may be self-financing through efficiency improvements whilst improving local security of supply and air quality. It is essential that the international community considers effective ways to enhance cooperation in this area.

Further international cooperation is essential to take forward step-change technologies such as hydrogen and carbon sequestration. The International Partnership for the Hydrogen Economy (IPHE) and Carbon Sequestration Leadership Forum (CSLF) have begun this important work. It is important that developing countries are able to participate in such work at an early stage.

The G8 agreed in 2003 the Evian Action Plan on Science and Technology for Sustainable Development. The UK will be taking forward the Evian Action Plan through its G8 Presidency this year, including by hosting the Energy Research and Innovation Workshop for heads of research institutions from the G8 and some developing economies in May. Amongst other things, this will consider how to get the most value from our cooperation on research and development.

We welcomed the suggestion from the Russian Minister that they might continue the discussion between Energy and Environment technical authorities in 2006 when they hold the G8 Presidency.

Conclusion

This Roundtable has demonstrated that we have a huge amount to learn from one another, and that international cooperation is vital. No one country can achieve the transformation to a lower carbon economy alone, but between us we have enormous power to act. This agenda for action outlines some of the ways in which we can cooperate further, and provides a rich source of ideas for continuing this dialogue and acting in partnership in a wide range of setting in future.

Source: G8 Gleneagles (Official UK website)
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