The European Community has, to its credit, been in the forefront of
those questioning the wisdom of extending this great planetary experiment
further into the unknown. A year ago, member states announced a collective
intention to stabilise their total emissions of carbon dioxide, the main
greenhouse gas.

Community negotiators want the global framework convention, due to be
signed at next year’s Earth Summit in Brazil, to contain similar commitments
covering the industrialised world as a precursor to a later protocol on
more comprehensive constraints on greenhouse gas emissions.

However Europe’s climate policy is in trouble. Various studies suggest
that stabilisation is technically feasible without imposing extra costs.
But key countries are wary of committing themselves to binding emission
targets when the policy issues, their impacts, and indeed our whole ability
to project and control emissions remain uncertain. The less-developed southern
European countries require room for growth, and attempts to find an equitable
sharing of the stabilisation target have been shelved.

The European Commission, pursuing a different track, has recently proposed
Community-wide measures with a central focus on a combined energy and carbon
tax. Energy pricing will certainly be important. But emissions also depend
heavily on the policies of member governments in areas such as transport,
building standards and the way in which utilities are regulated.

Thus, although the Community’s political commitment is an important
step, the real difficulties – as so often in environmental policy – lie
in the implementation. Harmonised policy tools, such as Community-wide taxes,
are worthy components. But there must still be an onus on member governments
to limit emissions. Yet national emission targets are unpromising and inefficient,
because they could require more difficult or high-cost measures in one country
while simpler opportunities for abatement in others remain unexploited.

There is, however, a way out. National ‘targets’ could be used, but
with the critical distinction that countries would be free to ‘trade’ them
with others.

In other words, the Community could create ’emission permits’, negotiating
an initial division of limits which would add up to the stabilisation level
already agreed, but which would not form fixed targets. Some countries could
let their emissions exceed their initial allocation if they bought permits
from others whose abatement efforts cut emissions to below the initial allocation.
Using this approach, the price of permits should settle at a point reflecting
the least costly way of meeting the stabilisation target anywhere in the
Community.

Setting up such a system would be complex and would require tough negotiations.
The problem of initial allocation would not disappear. However, compared
with fixed targets, it would be greatly eased by the added flexibility:
countries would no longer have to err on the side of extreme caution as
they would with fixed targets, and the approach could offer a face-saver
for countries that have already declared particular targets to be unacceptable.
With such a system in place, countries would have an incentive to search
out the cheapest way of limiting emissions, rather than to exaggerate the
difficulties to gain more lenient targets in future negotiations.

An allocation formula for the emission permits, instead of country-by-country
pleading, could be considered. An allocation based on a weighted mix of
1990 emissions and population, for example, would allow room for countries
with per-capita emissions that are lower than average to expand, and reward
them if their emissions did not grow too fast. Indeed, the system could
be designed to generate funds for supporting low-emission energy developments
in those countries.

It would also reward rapid reductions from countries with higher-than-average
emissions. The main losers would be countries which failed to reduce per
capita emissions that are higher than average. By implication, these countries
would have chosen to compensate for their situation by funding the abatement
of emissions elsewhere.

In the long run, the benefits would be global. An efficient agreement
is desirable for Europe; its returns would be huge in a global strategy.
If southern European countries may need room for emissions growth and assistance
for abatement, developing countries need the same ten times over.

Trying to negotiate individual emission targets or a global tax policy
for over 150 sovereign states is a hopeless undertaking. By comparison,
global control of carbon dioxide emissions through a transferable permit
system has unparalleled advantages.

The cautious, suspicious and painstaking process of international negotiations
cannot conceivably deliver from scratch such a radical innovation in international
affairs. Initially it can be developed, explored and demonstrated only by
a coherent group of closely aligned countries. The European Community is
the main candidate, though at the outset it could join with other countries
which have already committed themselves to stabilisation.

Once it is up and running, an EC system of transferable permits would
not only demonstrate the viability of the approach, but could expand through
a variety of mechanisms. The Community could thus become the nucleus of
efforts to bring order to a process of controlling carbon dioxide which
presently threatens to become a diplomatic and environmental quagmire stretching
over decades.

The time is ripe for such an initiative. If the Community cannot develop
a viable mechanism for implementation, its commitment to stabilisation will
become steadily less convincing, and could even backfire in the global negotiations.
In the run-up to the Earth Summit, the Community should reaffirm its stabilisation
goal and announce that it will be implemented through in international transferable
permit system. By doing so, it could lead an historic innovation in global
environmental policy. It should seize the opportunity.

Michael Grubb is a research fellow in the Energy and Environmental Programme
at the Royal Institute of International Affairs. He is the author of The
Greenhouse Effect: Negotiating Targets, published by the RIIA in 1989, and
Energy Policies and the Greenhouse Effect, published in two volumes in 1990
and 1991.

The politics of energy is a lively topic. In teasing out the links between
energy and national security in developing countries, Raju Thomas and Bennet
Ramberg’s choice of case studies often say as much about political developments
and pressures as they do about energy; all the better to catch the reader’s
interest.

The editors provide a valuable collection of analysis and (for most)
data on countries about which there is often much confusion, and many simplified
caricatures. They cover India, South Korea, Pakistan, Taiwan, Argentina,
Brazil, Cuba and South Africa. Linking chapters provide an overview to connect
different themes together, and expand on the idea that ‘the energy factor
plays a crucial role in the traditional defence verses development debate
in the industrializing world’.

Careful editing ensures that the studies address points such as oil
scarcity and the impact of the unexpected rises in price; rationalisations
for nuclear power; potential links with nuclear weapons programmes; and
the incentives and politics of the nuclear programmes. There is a useful
degree of consistency in the way these issues are approached, particularly
concerning developments over the past 20 years. The massive economic (and
political) impact of the rises in oil prices, and the central importance
of regional political tensions, reverberate through every chapter.

In South Korea, for example, the government opened up the energy debate
to try to reach a consensus because ‘energy is such an issue of life and
death, yet so difficult to control, that no government could shoulder the
burden alone’. In India, the shock of the steep rise in oil prices in 1973
was one of the harbingers of the unrest that caused the state of emergency
to be declared in 1975, nearly ending the world’s biggest democracy. Incidentally,
it made India’s nuclear lobby impregnable despite global concerns about
the weapons connection and the tensions with Pakistan.

All the chapters were written by analysts from universities in the US,
which gives them a theoretical flavour-little shows of the real feelings
and internal conflicts involved. The strength of editorial consistency is
also the weakness, for all the studies seem weak when they move outside
the traditional framework of oil and nuclear issues.

The role of conservation hardly receives a mention, and only the Cuban
study notes its absence as a specific weakness. Similarly, biomass energy
is of central importance in countries such as India and Pakistan. For most
of the population in these countries it is the only significant source of
energy so the increasing shortage of fuel wood combined with the role and
pricing of kerosene as a substitute are central questions, not only for
most of the people, but for the broader political field. I do not understand
how it was possible to write chapters on India and Pakistan without mentioning
any of this. The study of Brazil is the only one to address the role of
renewable sources of energy in its debate about the country’s massive programme
to obtain ethanol from sugar cane.

These weaknesses are compounded when the analysts attempt to look ahead,
for they are based on the assumption that the issues of the future will
be match the issues of the past. So references to gas are curiously limited,
nuclear power is assumed to be the only significant nonfossil fuel option
for the foreseeable future, and the tensions over the potential links with
weapons are still seen as a central and preoccupying problem. The word ‘environment’
arises only as an irritating constraint on developments to exploit hydroelectric
or nuclear power. In reality, it is more likely that nuclear energy is dead
as a large-scale supply option for some of these countries. Most either
now have a covert, or deliberately ambiguous, nuclear weapons capability,
or have concluded that flirting with nuclear weapons is simply not in their
interest. The chapters make this plain-but the authors do not draw out the
implications.

Energy security may continue as an underlying theme-probably to raise
its head again in a decade or two-but the other important debates about
energy for the future are likely to be over local, regional and global environmental
pressures. They will deal with the impacts and blame; the politics of sharing
out efforts to abate the effects of some policies; and the impact on and
resistance from energy producers. These all have implications not only for
energy, but also for security in its broader senses, which the authors stress
is their terrain. The studies reflect none of this.

The book is already dated in other respects, too. The political circumstances
in some of the countries has changed radically-perhaps most notably the
security of Cuba’s almost complete energy dependence on the Soviet Union,
but also with the softening of tensions between North and South Korea, and
between Argentina and Brazil. The authors did not consider the possible
implications of a flare-up in the Gulf, as had happened by the time of publication.

I found it more surprising that there is relatively little on the future
role of the non-proliferation treaty. Nor is there much weight given to
the treaty coming apart; this seems more probable after the debacle of the
review meeting in 1990, which ended without agreement following the refusal
of the nuclear powers to commit themselves to a comprehensive ban on tests.
So the overview chapters, which give such a fine impression of the historical
tensions over oil and nuclear power, already seem curiously dated.

It is a pity that a collection of studies so excellent in documenting
and analysing issues defined in its own terms of reference has so little
to say when it comes to other likely core issues relevant to energy politics
and security in these and many other countries. But that should not inhibit
those with an interest in energy and security, and particularly those wanting
to understand the political pressures which have driven nuclear programmes
in the industrialising world, from buying this book.

Michael Grubb is a resarch fellow at the Royal Institute of International
Affairs.