EU’s collective activities

So far, the overall attitude of the European Union in dealing with climate change issues is relatively positive. Similar to the United Kingdom, has also taken the role of a leader in international climate negotiations and is one of the main forces in promoting climate negotiations. The industrialization of the European Union has meant it has become involved very early in the field of energy conservation and environmental protection technology and has achieved many outstanding results and experiences. After the issue of environmental climate has risen as a hot topic of concern to the international community, the EU strongly hopes to use its first-mover advantage in the field of environmental technology to enrich its own strength through the teaching and selling of environmentally friendly products and technologies to grasp the dominance of global environmental governance.

Early understanding

As early as June 2000, the European Union launched the EU Climate Change Program (ECCP), which aims to formulate the most cost-effective policies for the reduction of GHG emissions within the jurisdiction of the European Union. The plan is organized by the European Commission and launched. Various sectors, non-governmental organizations, multinational experts and other related parties participated in the project, involving energy, transportation, research, agriculture and the three flexible operating mechanisms stipulated in the Kyoto Protocol.

In 2002, the EU’s 15 member states collectively adopted the Kyoto Protocol, which limits global GHG emissions. The EU promised that its emissions levels will be reduced by 8% between 2008 and 2012 relative to 1990 levels. Based on this, the EU has actively adopted a series of action plans and policy measures to develop emission reduction programs suitable for the economicdevelopment status and carbon emission levels of different member states and establish a GHG emission restriction system; and within each member state, a highly transparent and detailed national allocation plan has been formulated, specific to different industries. In each of the companies involved, the company’s emission reduction activities are encouraged by various policies to achieve the ultimate goal of reducing GHG emissions.

Form of trades

The carbon emissions trading scheme expanded from the EU is currently the world’s largest GHG quota trading market. The concept of “greenhouse gas emissions trading (ETS)” began in 1997 with the Kyoto Protocol and is one of the three mechanisms proposed in this book to reduce GHG emissions. This transaction mechanism was first applied to the first emission of carbon dioxide in GHG emissions, and the European Union has become a pioneer in this mechanism of transnational practice. The EU is trying to promote the establishment and operation of the carbon trading market, attempting to construct an EU emission trading system, building an EU-wide emissions trading market, and meeting the emission reduction targets in the most cost-effective manner, making full use of market mechanisms. Its advantages lie in ensuring the normal functioning of market functions and preventing the negative impact of the fragmented domestic emissions trading scheme.

The European Union has established a unified ETS mechanism for its member states on the basis of the basic establishment of its carbon trading system. On January 1, 2005, the EU-ETS, the EU’s GHG emissions trade plan, was formally launched and then covered the EU’s 25 member states. The plan stipulates the countries’ mandatory emission reduction targets and conducts assessments in two phases of 2005 2007 and 2008-2012. If the task of emission reduction cannot be completed, the first phase will be subject to a fine of 40 euro per ton of carbon dioxide. In the second phase, it will face a fine of 100 euros, and the fine will not offset the emission reduction obligations. In the second phase of the EU-ETS implementation, the member countries are allowed to participate in transactions through emission reduction credits obtained from emission reduction projects in developing countries and countries with economies in transition and are linked to Japan and the USA to form an open carbon emission system. The trading market has developed into the world’s largest GHG quota trading market.

Form of taxation

In terms of taxation, some EU countries have adopted carbon taxes to control and reduce GHG emissions. The carbon tax is a new taxation product under the influence of climate change in recent years. It is a tax type for carbon dioxide emissions. It has passed a ratio of carbon contained in fossil fuels such as coal, petroleum processed products (gasoline, jet fuel, etc.) and

Practical implications 59 natural gas. The levy of carbon tax will increase the market price of fossil energy products, thereby promoting enterprises to economize on the use of resources, improve the efficiency of energy use, increase the competitive advantage of non-fossil fuels in price to a certain extent and promote the use of non-fossil energy. Moreover, unlike the systems and measures required for emission reduction mechanisms such as total carbon emission control and carbon emissions trading, the collection of carbon taxes can only be achieved on the basis of the existing taxation system, and an additional small amount of management costs can be achieved.

In the early 1990s, Finland, Sweden, Denmark, the Netherlands began to levy a carbon tax. The tax rate was levied on CO, emissions or equivalent emissions basis and was collected through the final use of energy. In terms of tax rate setting, in 2008 Finland levied 20 euros per ton of CO, emissions, Sweden 107.15 euros, Denmark’s standard CO, tax rate was 12.10 euros, but different rates were applied to residents and businesses, and the residents’ tax rate was higher than the corporate tax rate. The proportion of carbon tax revenue in the four countries is about 0.4-0.7% of GDP and carbon tax accounts for about 1% of tax revenue. In terms of the use of carbon tax revenue, Finland's carbon tax revenue is considered as general revenue, and in Denmark all the carbon taxes paid by residents are used to subsidize public natural gas and electricity heating systems. The carbon taxes paid by enterprises are used to reduce employers’ contributions to the labor market and subsidies for energy-saving investments. It can be seen that in the European countries that imposed carbon taxes earlier, the specific implementation of the carbon tax was slightly different. However, the use of carbon tax revenue needs to be more focused on environmental protection and energy conservation.

Form of technologies

In response to climate change issues, the EU has also made more strategic deployments on energy development and low-carbon technologies. In March 2007, the European Commission proposed the EU Strategic Energy Technology Plan, which aims to promote research and development of low-carbon technologies in order to achieve the EU's commitment to the climate change goals, which in turn will drive the EU’s economic development model toward high-efficiency, low-emission transformation. The plan points out that by 2020, the proportion of renewable energy consumption in total consumption of energy in the EU will increase to 20%, and the consumption of primary energy such as coal, oil and natural gas will decrease by 20%, which will increase the share of biofuels in transportation energy consumption. There are several important energy use structural goals, such as proportions to 10%.

In October 2007, the European Commission proposed that the EU increase investment support for low-carbon technologies and hopes to increase 50 billion euros in funds to develop various types of low-carbon technologies in the next 10 years. According to the proposal, the EU’s annual investmentfunds in the related research fields for the development of low-carbon technologies will increase from the current 3 billion euros to 8 billion euros and will jointly develop a low-carbon technology roadmap for EU development among researchers and corporate business communities. We will vigorously promote the development and use of low-carbon technologies in key areas with great potential for development such as wind energy, solar energy, biomass energy and carbon dioxide capture and storage. Until the end of 2007, the European Commission adopted the EU Energy Technology Strategic Plan, explicitly proposing to encourage research and actively promote low-carbon energy technology.

According to the development trend of the European Union in the new energy industry and low-carbon technology industry, the relevant parties expect that by 2020, the EU economy will increase by 2.8 million jobs due to the transition to a low-carbon economy, although the transition to a low-carbon economy will also result in some jobs being lost, but the net increase in jobs is expected to reach 400,000.

Japan’s low-carbon society

After signing the Kyoto Protocol, Japan has not been able to promote high-profile issues such as the United Kingdom and the European Union on climate change, but it has been active in recent years. Japan's GHG emissions rank among the top in developed countries, mainly due to the rapid growth of energy consumption; in particular, Japan is the world’s third largest consumer of gasoline. Therefore, island countries like Japan, under the constraints of resources and environmental capacity, are the main entry point for GHG emission reductions. They reduce energy dependence by reducing the use of fossil fuels, increasing natural gas supply and building nuclear power plants, and will actively use the three emission reduction mechanisms stipulated in the Kyoto Protocol to create conditions for carbon reduction in the country.

Early understanding

Japan first launched the “Global Warming Measures Promotion Program” in 1998, and carried out carbon emission reduction actions in two stages: the first stage was mainly industrial reduction, and the second stage in 2003 was housing and transportation. The department’s reductions mainly include initiatives to promote voluntary reduction of industries. Correspondingly, the “Global Warming Measures Promotion Act” has been adopted to establish the responsibility and basic measures for the central local government, enterprises and residents to cope with global warming.

As for the legal protection of energy saving and emission reduction, Japan’s “Energy Conservation Law” plays a guiding role. In response to the grim situation after the first world oil crisis in the 1970s, Japan enacted and implemented the Energy Use Rationalization Act (referred to as the Energy Conservation

Act) as early as 1979. The law is for construction and machinery. The energyconsuming industry has made a series of energy-saving regulations. After signing the Kyoto Protocol, Japan has revised the Energy Conservation Law on several occasions in order to facilitate the economic reduction of carbon emissions through energy conservation. The revised Energy Conservation Law covers more areas of management, and will update the energy efficiency assessment standards with the times to meet the new requirements for energy conservation in the new era. The law has greatly ensured the efficiency of energy use, strengthened energy-saving and emission-reduction standards, developed universal energy-saving technologies and formed a new type of society that suppresses CO, emissions.

Form of taxation

In order to give full play to the role of the Energy Saving Act, Japan will give active assistance and cooperation in taxation policies, implement special accelerated depreciation and tax reduction policies for energy-saving technologies and equipment, and reduce or exempt taxes for enterprises that meet energy-saving targets on fossil fuels. Use and power users impose energy taxes and environmental taxes. The Ministry of Economy, Trade and Industry of Japan regularly publishes energy-saving product catalogues and provides special depreciation and tax-relief measures for energy-saving products included in the catalogues used by producers of enterprises. The reduction or exemption of taxes can be up to 20% of the equipment cost, and can be renewed on the basis of its normal depreciation, to extract nearly 30% of special depreciation.

In terms of energy and transportation, taxes on automobile fuels and automobile purchase taxes are mainly included. Since 2003, coal has been taxed, and petroleum taxes have been adjusted to petroleum and coal taxes. Japan is also involved in the carbon tax. Since the Ministry of the Environment of Japan proposed the carbon tax scheme in 2004, after many modifications, its tax rate has dropped from the earliest 1.83 yen/liter to 0.82 yen/liter, and the family burden has been from 3,000 days per year. The Yuan dropped to 2,000 yen. The lower carbon tax rate is one of the most important reasons for people’s widespread support.

Form of technologies

On March 5, 2008, the Ministry of Economy, Trade and Industry of Japan announced the “Cool Earth Energy Technology Innovation Plan,” which has formulated a roadmap for the development of Japan’s energy innovation technology by 2050, and identified 21 key innovations for innovative technologies, namely: high-efficiency natural gas thermal power generation, high-efficiency coal-fired power generation technologies, carbon dioxide capture and storage technologies, new solar power generation, advanced nuclear power generation technologies, superconducting and efficient transmission technologies.

advanced road transportation systems, fuel cell vehicles, plug-in hybrid electric power automotive, biomass energy alternative fuels, innovative materials and production processing technology, innovative ironmaking processes, energyefficient residential buildings, next-generation efficient lighting, stationary fuel cells, ultra-efficient heat pumps, energy-saving information equipment systems, electronics power technology, hydrogen generation, storage and transportation technology. In May 2008, the Japan General Scientific and Technical Conference announced the “Low-carbon Technology Plan,” and proposed measures to achieve a low-carbon society’s technology strategy and environmental and energy technology innovations, involving rapid neutron breeder reactor cycle technology and ships with high energy efficiency, smart transportation systems and many other innovative technologies.

The figures released in September 2008 show that in the science and technology-related budget, the development cost of environmental energy technologies that are only listed separately amounts to nearly 10 billion yen, of which the budget for innovative solar power generation technology is 5.5 billion yen. In April 2009, the Japanese government first included the development of solar energy in the economic stimulus plan and reactivated the solar energy incentive policy as one of the core strategies for economic restructuring. The stimulus policy was innovative in this year's 3.5 billion yen. Based on the solar power technical budget, an additional 1.6 trillion yen in environmental protection project expenditures will be added, mainly for the development and utilization of solar energy technologies. It is planned to reduce the price of solar power generation equipment to half of the current price in the next 3-5 years. The policy aimed to accelerate the construction of energy-efficient buildings and strove for 50% of homes to meet energy-saving requirements by 2019. At present, there are many energy and environmental technologies in Japan that are at the forefront of the world, such as the combined use of solar energy and thermal insulation materials, the reduction of energy-consuming cogeneration system technology for residential buildings, and waste-water treatment technologies and plastic recycling technologies.

Social patterns

As early as April 2004, the Global Environment Research Fund, a subordinate of the Ministry of the Environment of Japan, formulated a research plan on “a low-carbon social scenario for Japan in 2050.” The research staff of this program is composed of nearly 60 researchers including universities, research institutions and companies. Starting from five perspectives - development scenarios, long-term goals, urban structure, information and communication technologies and transportation - the study will focus on the development of a low-carbon society in Japan in 2050, scenarios and roadmaps, and propose specific countermeasures in terms of technological innovation, institutional changes, and lifestyle changes. In February 2007, the project team pointed out in the research report that it is feasible to meet the energy demand for

Japan’s social and economic development by 2050 while achieving the target of reducing emissions by 70% compared with the 1990 level, and it is feasible for the idea of a low-carbon society. In May the following year, the project team completed the “12 Actions for Low-Carbon Social Scenarios in Japan in 2050,” which covers the residential sector, industrial sector, transportation sector, energy conversion sector and related cross-sectors. The action includes three parts: the future goal, obstacles to achieve the goal and its strategic countermeasures and implementation process and steps (Peng Shuijun & Liu Anping, 2010).

In June 2008, the famous “Fukuda Blueprint” was born. The Japanese Prime Minister Yasuo Fukuda proposed a new countermeasure to prevent global warming in Japan. This marks the official formation of Japan’s low-carbon strategy, which responds to Japan’s low-carbon development technology innovation. In July of the same year, the Japanese Cabinet of Ministers passed the “Action Plan for Realizing a Low-Carbon Society.” The Japanese government selects typical cities (larger cities with a population of more than 700,000 in Yokohama and Kyushu, local center cities with a population of 100,000-700,000), Okcheon City. Toyama City and a small-scale city-county village with a population of less than 100,000, Mizuno, Shimokawa-cho, Hokkaido, as an “environmental model city” that promotes the transition to a low-carbon society and leads the international trend, vigorously promotes the construction and production of wind energy and solar energy, establishes an environmentally friendly transportation system, and implements carbon reduction in these cities. There are plans to promote low-carbon development in society and build low-carbon cities.

In April 2009, Japan announced the draft policy on “Green Economy and Social Transformation” and strengthened Japan's low-carbon economy by implementing measures such as reducing GHG emissions. In addition to requesting environmental and energy measures to stimulate the economy, the draft policy also proposes mid- and long-term guidelines such as social capital, consumption, investment and technological innovation in order to achieve a low-carbon society and achieve a harmonious coexistence with nature.

Practice of the USA

The USA has relatively weak political will to deal with global climate change issues. The decision to unilaterally withdraw from the Kyoto Protocol, particularly during the Bush administration, has created obstacles to international climate negotiations and cooperation. The Obama’s successor government has shown more positive attitudes and changed its consistent negative attitude toward climate issues. It can be seen that the USA is deeply affected by interest groups in terms of climate change, and there are many uncertainties in its political position. However, in recent years, especially after the financial crisis, mainstream American society has begun to change its attitude toward climate change issues and support the adoption of energy security to actively deal with climate change issues.

Early understanding

As early as October 1993, the Clinton Administration announced a “Climate Change Action Plan,” clearly stating that by the year 2000, US GHG emissions will return to 1990 levels of emissions and promised to change the mode of economic development to promote economic development and provide more job opportunities. In February 2002, the Bush administration proposed a new environmental program called “New Approaches to Global Climate Change” that focuses on the voluntary GHG emission reduction plan, and states that by 2012, the USA will work to decrease greenhouse gases. The emission intensity was reduced by 18%, and the Climate Change Science Program (CCSP) and the Climate Change Technology Program (CCTP) were launched to explore cost-effective climate-environment technologies.

Subsequently, the Bush administration launched the “Voluntary Corporate-Government Partnership Program” to provide tax incentives for those companies that voluntarily reduce emissions. The partnership includes cement, forestry, medicine, public utilities, information technology, retail, etc. throughout the country’s 50 states. On July 11, 2007, the US Senate proposed the Low Carbon Economy Act, which shows that the development path of a low-carbon economy is expected to become an important strategic choice for the USA in the future.

Legal form

On March 31, 2009, the United States House Energy Committee proposed to the Congress the “The American Clean Energy and Security Act of 2009.” The bill consists of four parts: green energy, energy efficiency, GHG emission reduction and transition to a low-carbon economy. The main contents of the Green Energy and Security Protection Act in the transition to a low-carbon economy include: ensuring the international competitiveness of US industries, green job opportunities and the transformation of laborers, exporting low-carbon technologies, and responding to climate change. The bill constitutes the legal framework for the transition of the USA to a low-carbon economy.

On June 26, 2009, the US House of Representatives passed the American Clean Energy and Security Act with a weak vote of 219:216. This comprehensive energy law is not a direct climate change law by its name. However, it contains important contents, such as total amount limit and transactionbased response to climate change. This is the first US package to deal with climate change. It not only sets a timetable for the reduction of GHG emissions in the USA, it also designs emissions trading and attempts to achieve emission reduction targets at a minimum cost through market-based measures. The

Practical implications 65 bill includes multisectoral planning in five areas including plot energy, energy efficiency, reduction of GHG emissions, transition to a clean energy economy and reduction of agro-forestry emissions. The specific content concerns the development of renewable energy, carbon capture and storage technologies and low carbon. Transport fuels, clean electric vehicles and smart grids improve energy efficiency in construction, electrical appliances, transportation and industrial sectors.

The US Clean Energy Security Act stipulates the US carbon emission control limit. Compared with 2005, global warming pollution will be gradually reduced to 17% by 2020, to 42% in 2030, and to 83% in 2050. According to energy structure and housing construction, by 2012, renewable energy such as bioenergy, solar energy and wind energy will account for 10% of US electricity sources and will increase to 30% by 2020; the energy efficiency of newly built buildings after 2012 will have to be 30%, after 2016, it needs to increase by 50%, basically achieving carbon-neutral or zero-carbon emissions. Once this law comes into force, it will cover 85% of the industry in the USA, basically covering all power companies and major industrial companies with CO, equivalents exceeding 25,000 tons, and their coverage will be more extensive than the current EU climate change law.

Interstate forms

The federal government of the USA has been slow to act on climate change issues, and local interstate governments have been active in dealing with climate change. This contrasts sharply, as some state governments have successively introduced emission reduction bills and measures. About 40 states have established GHG reporting systems. More than 30 states have established renewable energy development goals and formulated climate action plans, and more than 20 states have implemented emission trade policies. There have been various practical actions to deal with climate change. In December 2005, the North American and Mid-Atlantic states (later ten states) reached the Regional Greenhouse Gas Initiative (RGGI), which is a quota and trading system for CO, emissions from power plants in the region and is the first mandatory and market-based system in the USA to reduce GHG emissions. In order to facilitate the implementation of emission reduction targets, RGGI provides flexible mechanisms to allow the use of emission reduction credits outside the power sector.

The state of California is among the state governments that are actively fulfilling their responsibility for climate change mitigation. On July 31, 2006, the Governor of California, Arnold Schwarzenegger and the British Prime Minister Tony Blair announced an agreement to jointly explore the possibility of establishing a system for the emission of GHG emission rights for emitters, through the use of market forces and market incentives to control GHG emissions. In accordance with the agreement reached by both parties, they will establish a new transatlantic carbon dioxide trading market, and on

August 31, 2006, California passed the Global Warming Solutions Act in the market trading mechanism. In the application, the purchase and sale of the allowable emissions index has a large incentive mechanism for reducing GHG emissions.

Form of trades

Founded in 2003, the Chicago Climate Exchange (CCX) is the first in the world and the only organization and trading platform in North America that voluntarily participates in GHG emission reduction transactions and legally binds emission reductions. You can accomplish your own emission reduction tasks through internal emission reduction, Joint Implementation methods, or emissions trading to conduct GHG emission reduction transactions. The emission reduction targets of CCX are divided into two phases. In the first phase (2003 2006), all member units have an average reduction of more than 4% on the basis of the base year, and the second phase (2007-2010) is in the base year, based on an average reduction of more than 6% on the basis, and CCX’s emission reduction plan is legally binding.

There are nearly 200 members of the Chicago Stock Exchange, from dozens of different industries such as aviation, automobiles, power, environment and transportation. Members are divided into two categories: one is from entities, cities, and the other entities that emit GHGs, and they must comply with their promised emission reduction targets; the other is participants of the exchange. The exchange’s emissions trading program involves six GHGs, including carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, perfluorinated compounds and sulfur hexafluoride. At present, the CCX is the second largest carbon sink trading market in the world, and the only six GHG emission reduction transactions in the world that simultaneously implement carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, perfluorinated compounds and sulfur hexafluoride. As of June 16, 2006, its carbon trading volume reached 283 million metric tons, accounting for 80-90% of the EU’s total trading volume of the Kyoto Protocol’s climate trading system, making it the largest exchange in the EU system.

Form of technologies

The USA attaches great importance to technological innovation in the effective use of energy in GHG emission reductions and is the country with the highest R&D investment in a low-carbon economy: in the federal government’s budget, supporting energy conservation and new energy development is a policy priority, and the US Department of Energy’s Renewable Energy Agency is responsible for energy conservation and new energy development. The Bureau's budget for 2009 is USS 1.255 billion, which is mainly used for R&D and the promotion of renewable energy technologies, significantly increasing the production of clean energy and promoting the use of

Practical implications 67 energy efficiency technologies. It provides information services to promote the rapid transformation of energy systems.

On February 15, 2009, the USA introduced the American Recovery Reinvestment Act, which has a total investment of US$787 billion. It has made the development of new energy an important part, including the development of high-efficiency batteries and smart grids, carbon storage and carbon capture, renewable energy such as wind power and solar energy, plans to allocate US$50 billion to improve energy efficiency and promote renewable energy production. In the new energy plan, it is expected to invest US$150 billion in 10 years. The R&D and promotion of solar energy, wind energy, biomass energy and other new energy projects have invested US$4 billion in government funds to support the reorganization, transformation and technological advancement of the automotive industry.

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