“The more you pollute, the more you pay”

In the speech at the second Central Asian Climate Change Conference (CACCC-2019) in April 2019 in Tashkent, Uzbekistan, the deputy Head of International relations of the Ministry of Energy of the Republic of Kazakhstan Bekbergen Kerey repeatedly emphasized the importance of the ‘polluter pays’ environmental principle and concluded his remarks with the words “The more you pollute, the more you pay”. What did Bekbergen Kerey imply and why was he so categorical in his conclusions?

Climate change significantly impacts all key sectors of the economy on a global scale, and unfortunately, Central Asia happens to emerge into one of the most vulnerable regions of the planet. In spite of the active efforts worldwide to combat climate change and the adoption of a number of binding documents, the temperature rise rate is inevitably increasing along with the higher concentration of greenhouse gas emissions in the atmosphere. Therefore, our countries’ priorities include the interconnectedness of the global and national actions to combat climate change, mobilization of resources and transfer of new technologies to adapt and mitigate greenhouse gas emissions. Hence the statement that “a polluter pays”, that implies not only increasing control over emissions into the atmosphere by industrial enterprises, but also introducing laws and regulations in the Republic of Kazakhstan to toughen penalties for emissions and environmental damage in general, which are based on the Environmental Code.

Bekbergen Kerey has clearly indicated that those who produce the emissions and violate environmental norms, are the ones who will be held responsible for clean-up and loss compensation: “I would like to specifically focus on our Environmental Code. The purpose of the Code is enhancement of economic mechanisms of nature use through reforming the system of environmental payments and introducing the ‘polluter pays’ principle. The deadline for submitting the Environmental Code to the Mazhilis (the Parliament) is in December this year. In September 2018 the concept was approved, and it laid down the principle of inevitable responsibility for causing damage to the environment and full compensation for environmental damage. According to international best practices in the European Union and the United States, losses are estimated based on the actual damage in order to restore the state before the impact. The compensated amounts will be used to allocate for losses and restore the damaged natural environment. The environmental responsibility will be based on the ‘violator pays’ principle.

In addition, Bekbergen Kerey mentioned that “now we have started the drafting of the new Environmental Code”. You know that since the 2007 enforcement of the Environmental Code it experienced multiple amendments – 63 changes and additions. That’s why now we want to introduce a new section on climate, including a section on climate change adaptation in the Code”.

Lets recall that the Republic of Kazakhstan ratified the UN Framework Convention on Climate Change in 1995 (adopted in 1992 at the “Planet Earth” high-level summit), ratified the Kyoto Protocol in 2009 (adopted in 1997), and in 2016 – the Paris Agreement on climate change (the agreement was adopted in 2015 and signed by the heads of 175 states in the UN Headquarters in New York on 22 April 2016). 

In the framework of the latest agreement Kazakhstan took voluntary commitments to lower greenhouse gas emissions by 15% by 2030 from the level of 1990. Trading GHG emissions quotas has become one of the ways of achieving this goal. This system was launched in 2013 as a pilot project. The second stage was implemented in 2014-2015 when the country held its first emissions quotas exchange trading, however in 2016 the process was suspended until 2018 for enhancement of the related regulations. On 26 December 2017 the new National Plan for 2018-2020 was approved, kick-starting the new stage of the operations for the emissions trading scheme. The National Plan covers 225 installations – 29 enterprises in energy, oil and gas, mining, metallurgy, chemicals and processing economic sectors. The volume of distribution quotas allocated 485 mln CО2 tons for three years – from 2018 through 2020. In the meantime, there is a special allocation for “development reserve” of 35 mln tons to issue additional quotas in case of increasing capacity, for issuing quotas for new installations and trading quotas at the auction. 

Why is quota trade necessary? The main goal of integrating the GHG emissions market mechanism is providing stimulus for enterprises to apply green technologies and improve their efficiency. Instead of spending regularly enormous amounts for quota purchase, an enterprises can use the same or lesser amount of money to improve production, introducing modern and environmentally sustainable technologies, which will automatically result in cutting emissions into the atmosphere. Is it profitable? Certainly!

In his speech Bekbergen Kerey noted that Kazakhstan regularly provides reports to the Secretariat of the UN Framework Convention on Climate Change, that the issues of climate change are integrated in the strategic planning system at different levels, that the legislation on reducing greenhouse gas emissions has been developed and the requirements of international treaties are observed. In regard to further actions, these will be connected to the terms of the Paris Agreement on climate change. 

For referenceThe second Central Asian Climate Change Conference (CACCC 2019) took place on April 3-4, 2019 in Tashkent (Uzbekistan). The main objective of the conference is promoting regional cooperation and partnership in climate change adaptation and mitigation in Central Asia. The Conference is building on the initiative of the World Bank for knowledge and information exchange in Central Asia and supported by the CAMP4ASB project. The first conference took place on 24-25 January 2018 in Almaty (Kazakhstan).  

This publication is available in Russian