Kyoto Protocol

What is the Kyoto Protocol?

The Kyoto Protocol is a treaty created by the United Nations in 1997 that aimed to reduce carbon emissions worldwide, thereby combating global warming or climate change. The name, Kyoto, was derived from the city in Japan where the protocol was adopted.

The Kyoto Protocol was an extension of the UN’s 1992 Framework Convention on Climate Change. The convention initially committed to reduce greenhouse gas emissions. It was based on the UN’s belief that there was a consensus among the scientific community that global warming is a real phenomenon, and is primarily caused by carbon emissions made by human activities.

What Does the Protocol Cover?

The Kyoto Protocol applies to the following six greenhouse gases:

• Carbon dioxide
• Nitrous oxide
• Methane
• Perfluorocarbons (PFCs)
• Hydrofluorocarbons (HFCs)
• Sulfur hexafluoride

Although the Protocol was adopted in 1997, it did not go into effect until 2005. In 2012, the Kyoto Protocol was extended with the adoption of the Doha Amendment.

The Protocol focused on demands that 37 developed nations work to reduce their greenhouse gas emissions. It placed the burden for emission reductions on developed nations, viewing them as largely responsible for carbon emissions.

Developing nations were only asked to comply voluntarily. The Protocol’s approach in such regard was defined in the treaty as the principle of “common but differentiated responsibility and respective capabilities.” It included establishing a “carbon credits system,” whereby nations can earn credits by participating in emission reduction projects in other nations.

Problems with the Protocol

The facts about carbon emissions, however, appear to show that the UN’s reasoning is flawed. For example, less developed nations – which are likely to be more reliant on coal as an energy source and less likely to impose restrictive environmental laws – in fact, account for much of the worldwide total of carbon emissions.

China and India together account for approximately 35% of total carbon emissions, as of 2020, while the developed nations of the UK, France, and Germany combined, only account for 4% of the world’s carbon emissions. Yet China and India were both exempted from the treaty’s requirements, which only apply to 37 developed nations.

Critics of the Kyoto Protocol argue that it is extremely easy for 155 signatory nations out of the 192 to vote in favor of it when they are exempted from all of its requirements.

The Current State of the Kyoto Protocol

The Doha Amendment in 2015 extended the Protocol to 2020. However, it became a moot point shortly thereafter when the Paris Climate Accord was signed by most of the original ratifiers of the Kyoto Protocol. The U.S. initially signed the Paris Climate Accord but later withdrew from the agreement.

Like the Kyoto Protocol that preceded it, the Paris Climate Accord was also subjected to much criticism. For example, the Accord is criticized for only requiring that a country submit a statement that it intends to work on reducing carbon emissions at some point in the future for it to be considered as fulfilling the requirements of the agreement. In contrast, it doesn’t require countries to actually do anything to reduce carbon emissions right now.

An example of how the agreement’s structure falls short can be seen by looking at the nation of Brazil. It submitted a statement that it intends to start working on reducing carbon emissions by 2%, starting in 2040. That “do nothing” statement is all that’s required to certify Brazil as being a signatory in good standing of the Paris Climate Accord.

Even if every signatory country met its stated carbon emissions reductions targets, it would only put a small dent in the total amount of carbon emissions worldwide. John Kerry, the former U.S. Secretary of State, stated that even if the U.S. eliminated all its carbon emissions, “that still wouldn’t be enough to offset the carbon pollution coming from the rest of the world.”

Additional Resources

To keep advancing your career, the additional CFI resources below will be useful:

• Developed Economy
• ESG (Environmental, Social, and Governance)
• Negative Externalities
• Renewable Energy
• Voluntary Carbon Market
• See all ESG resources