Inline Insights

In Lima, at the beginning of this week, after two weeks of the usual tortuous negotiations, the 196 parties to the UN Framework Convention on Climate Change (UNFCCC) emerged with the Lima Call for Climate Action. This sets out the main priority issues for the parties in relation to the landmark COP 21 in Paris in December 2015 - the deadline for an international agreement on climate change - and attaches a 39-page document (a “non-paper”) containing various options for different elements of  a draft negotiating text.

This note analyses Lima’s outcomes and the prospects for an international climate agreement in Paris 12 months away.

On 1 December representatives of the 196 parties (member countries) to the United Nations Framework on Climate Change (UNFCCC) will gather in Lima for the annual Conference of the Parties (COP) international meeting. The climate negotiations have in recent years - especially since the conspicuous failure of parties at Copenhagen in 2009 to agree an international treaty - tended to be regarded as a non-event, an interminable discussion from which nothing material ever emerges. Will Lima, COP 20, be any different?

This article follows up a recent piece I wrote on the importance of agreeing a 2030 climate and energy framework at last month’s European Council. Following that agreement in Brussels, this article analyses some of the interesting (and surprising) elements of the agreement, and looks ahead to how the agreement will be followed up over the next few months.

This Thursday and Friday, 23 and 24 October, at the European Council in Brussels, EU Heads of Government will take their most significant decision on climate change and energy policy for nearly six years, i.e. since the 2020 framework was passed into legislation. On the agenda this week is a prospective political agreement on the policy framework for climate and energy up to 2030, setting relevant targets to deliver that framework. Energy security is also on the agenda, with the Council reverting to its discussions in June on the European Commission report on how to reduce dependence on Russian gas.

Remotely Piloted Aircraft Systems (RPAS), more commonly referred to as ‘civil drones’ or ‘unmanned aerial vehicles’ (UAVs), can perform tasks that manned systems are sometimes unable to perform. They can be useful for surveillance purposes, border control, agriculture, firefighting, or media and entertainment, amongst other applications. The EU and some of its Member States have in recent years acknowledged the benefits of this new technology. The latter have, in certain cases, introduced new regulations that enable the industry to flourish, whilst minimising potential issues that may arise within their territory.

The temperatures are falling; the mornings and nights are getting a little darker; it feels like autumn is just around the corner - it’s back to school time! This particularly applies to the politicians and civil servants who ply their trade in Brussels on EU policies and regulation. The new European Parliament barely had time to convene before it departed for the summer break. At the European Commission, all eyes are on new President Jean-Claude Juncker as the horse-trading between him and member states for the top political jobs in Brussels, including Commissioner portfolios, reaches its climax over the next two weeks.

Price Comparison Websites (PCWs) are popular tools amongst tech-savvy consumers, especially in the consumer goods, energy and financial sectors. The key to their attractiveness is that they allow consumers to quickly search for and compare the best deals in the market. PCWs usually operate on either a flat-fee, or a commission-based model and attract new customers via online and offline advertising. Some of the biggest players have become very profitable, thus attracting new companies to enter the market.

At the beginning of the month, the European Banking Authority (EBA), the institution charged with overseeing the European banking sector, proposed guidelines for a regulatory regime for virtual currency. The report has now been presented to the EU Council, Commission and Parliament for consideration. The report also issues guidelines for national supervisory bodies.

Goldman Sachs received an $800,000 fine from US regulators a fortnight ago for failing to meet the guidelines for trading within a private forum. Private trading platforms, commonly known as dark pools, now account for 15% of all US trading over 40 closed exchanges. Regulators are beginning to take note and see how they can limit the risk involved.

The questions of who will occupy the top jobs on environment and energy in Brussels over the next five years, particularly in the European Parliament (EP) and in the European Commission, will matter greatly. There is a big policy agenda ahead, coming at a testing time for European policies on energy markets and security of supply, which will have price implications for industry and consumers, and the decarbonisation strategy.

About a year ago, Amazon’s CEO Jeff Bezos announced that Amazon were testing unmanned drones – called Octopers – to start delivering packages to customers in five years’ time. This announcement gave Amazon a PR boost; and was perhaps also initiated in the hope of raising awareness around businesses being given authorisation to use drones commercially.

According to the US drone industry, regulation is necessary for it to be profitable, as current regulations in most jurisdictions prevent unmanned aerial vehicles (UAVs) from flying over densely populated areas.

Things may be looking up for the EU’s “flagship” climate policy instrument. But much more needs to be done from the autumn.

The Government would be advised to eschew a fracking at all costs approach in favour of a more carefully weighted public strategy.

One of the more eye-catching measures announced in the recent Queen’s Speech was the UK Government’s proposal to change the trespass laws and allow fracking companies to drill under people’s homes without their permission.

This is important…

On 28 May the European Commission adopted a major communication on an EU energy security strategy. This is potentially an extremely important document - especially if it were to be implemented – and was drafted, at the request of member states, as a direct response to the Ukrainian crisis and concerns about over-reliance on Russian gas. There are few things more critical than keeping the lights on and our homes heated.

As the fall-out from the European Parliament (EP) elections continues to dominate the headlines (see our preliminary analysis of the results here), the nomination by EU leaders of their nation’s next EU Commissioner (and the specific portfolio which they will take on) is becoming a key thread of the post-election discourse.