NEGOTIATIONS:

Senate delay on climate bill could stymie Copenhagen talks

Climate change activists reacted sharply yesterday to indications from Senate Majority Leader Harry Reid (D-Nev.) that cap-and-trade legislation may have to wait until 2010, warning that the delay could derail international negotiations in Copenhagen.

Annie Petsonk, international counsel for Environmental Defense Fund, said she fears the U.N. talks slated for December will flounder without a clear plan from President Obama to move climate legislation through Congress.

"The appearance to the international community would be that the U.S. Congress is just adrift," she said.

Jake Schmidt, international climate policy director for Natural Resources Defense Council, said State Department negotiators need domestic legislation in order to convince China and other developing countries that the United States is prepared to act -- and to push those countries in turn to make emissions-cutting commitments.

"We're at a critical stage in the negotiations," Schmidt said. "Reid is sending signals, and it's not clear what they all mean."

Reid, speaking to reporters yesterday, said health care and regulatory reform may dominate the rest of the legislative session, and suggested cap and trade may not come until next year.

"So, you know, we are going to have a busy, busy time the rest of this year," Reid said. "And, of course, nothing terminates at the end of this year. We still have next year to complete things if we have to."(E&ENews PM, Sept. 15).

The House in June passed climate legislation 219-212. Senate Environment and Public Works Chairwoman Barbara Boxer (D-Calif.) and Foreign Relations Chairman John Kerry (D-Mass.) had planned to unveil the Senate version at the beginning of September, but now are expected to release it at the end of the month.

An adaptation plan in the works

Kerry, speaking yesterday on a conference call with the U.N. Foundation, described the Senate bill as only "marginally delayed" by the health care debate and hip surgery he underwent over the summer. He pledged to put into it more U.S. money toward helping poor nations fight climate change.

Kerry called international adaptation efforts "part of the glue" holding together negotiations toward a new global treaty.

"Many countries that don't emit [greenhouse gases] or are marginally emitting are going to suffer the greatest consequences," Kerry said. Industrialized nations and "major emitters over the last 150 years who created the problem," he added, have an obligation to act.

Kerry's comments come on the eve of three major meetings this month slated for Washington, D.C.; New York; and Pittsburgh, at which ambassadors, finance ministers and other world leaders will try to work out some of the thorniest negotiating issues standing in the way of a new treaty.

Representatives from the world's largest economies -- which also happen to be the largest emitters -- meet tomorrow and Friday at the State Department for the Major Economies Forum. That will be followed by a meeting at the United Nations in New York aimed at propelling negotiations, and then by the G-20 summit of finance ministers in Pittsburgh, where climate change is expected to play a prominent role.

Tensions between rich and poor countries have become a hallmark of the climate talks, and will likely come to a head when international negotiators gather this December in Copenhagen, which was once was expected to be the site of a new global emissions pact. With countries still at odds over several issues, even U.N. Framework Convention on Climate Change chief Yvo de Boer this week ruled out the possibility that negotiators would finalize a comprehensive treaty this year, but analysts do expect to set a framework in place.

Firms worry about supplies of sneakers, coffee and bluejeans

Leading business groups, meanwhile, tried to make an economic case for pouring money into Africa, Latin America, South Asia and other regions that will be hit hardest by rising sea levels, storms and drought.

"Climate change represents a direct business risk to our supply chain. You can't just grow coffee in Iowa," said Jim Hanna, director of environmental impact at Starbucks Coffee Co., noting that changing weather patterns threaten coffee production in several parts of the world.

Activists have long pressed Congress to devote more money toward helping poor nations cope with climate change, often couching the argument in moral terms. But Hanna, speaking with leaders from Nike and Levi Strauss & Co. on a panel sponsored by Oxfam International yesterday, said it's the economic angle that's perking up politicians' ears.

From fears that drought-plagued countries will grow less cotton for bluejeans to worries about the depletion of rubber necessary for sneakers to concerns that storms and flooding in vulnerable countries like Bangladesh will shutter apparel factories, companies said their need to protect nations from the threat of climate change goes beyond altruism.

"Moral arguments aside, it makes absolute economic sense to mitigate your own issues," Hanna said.

The House-passed climate bill directs 1 percent of allowances apiece to adaptation and clean technology development overseas from 2012 to 2021. The amount would increase to 4 percent from 2022 to 2026 and then to 8 percent in 2027 and beyond.

Aid groups say that, under current estimates of the value of allowances, the funding comes to about $1.5 billion -- far short of the combined $12 billion they say is needed.

Oxfam and business officials yesterday pressed to raise the allowances to 3 percent. Kerry, meanwhile, said a group of evangelical leaders stopped into his office this week expressing concern about the funding.

"They're committed to trying to raise that level," Kerry said, adding, "I'm committed to trying to raise it in the Senate."

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