As a December United Nations negotiating session on climate change in Milan drew to a close, business representatives were encouraged by signs that governments were now emphasizing the role technology must play in reducing greenhouse gases.

But the conference – the latest round in a more-than decade-long process to establish an international program to curb greenhouse gas emissions – produced limited progress on specific policies to attain that objective economically and with global participation. Uncertainties were compounded by the questionable prospects for the Kyoto Protocol ‘s entry into force, as statements by the Russian government indicated its unwillingness to ratify quickly. The Kyoto Protocol requires Russia’s ratification to enter into force.

"Business and industry are anxiously awaiting the views of governments on how they are going to overcome their differences," stated Juhani Santaholma, executive director of the Finnish Energy Association, speaking at the meeting on behalf of ICC.

For years, business has insisted that innovative technologies provide the most effective economic solution to long-term risks of climate change. "It is evident today that the widespread use of existing, efficient technology is indispensable, and that a wide range of technologies will be needed," according to Nick Campbell, who chairs ICC's working party on climate change.

On another positive note, in the view of business observers, the Milan conference of the parties to the United Nations Framework Convention on Climate Change was the first time government delegates consulted business directly on ways to improve frameworks to support technology transfer.

"Global solutions to climate change will only work if they support improved access to energy, poverty eradication, successful entrepreneurship and investment in developing countries," said Norine Kennedy, USCIB’s vice president for environmental affairs.

Representatives of ENI, the World Energy Council, ABB, Framatome and others described successful projects in developing countries and recommended broader emphasis on governance, finance, trade, investment, and capacity building to further the development and dissemination of technology.

Business commentators have regretted negotiators' decision to limit the potential of the so-called Kyoto mechanisms – agreed in 1997 – which include emissions trading to enable countries to reach their targets for reducing them.

Another mechanism is the clean development mechanism (CDM), where developed countries can earn credits to offset against their targets by funding clean technologies, such as solar power, in poorer countries.

ICC has stated that constraints to the CDM would be counter-productive, undermining its potential to contribute to cost-effective compliance and limiting opportunities for developing countries to benefit from project-based investments.

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ISO Considers Standards on Greenhouse Emissions – The International Organization on Standardization (ISO) is in the process of developing a consensus standard on greenhouse gas accounting: ISO 14064. The result will be a wide-ranging three-part standard to define how companies of all sizes, sectors and nationalities will develop inventories of their own greenhouse emissions, account for project emissions and determine how third parties will verify and validate those emissions. USCIB has stated that the ISO draft standards are evolving to become complex and burdensome, with potentially onerous third-party verification requirements. These ISO standards will likely become the internationally accepted approach and will put pressure on businesses worldwide to adopt them. Greenhouse gas accounting and reporting will be at the heart of emissions control policy at domestic, regional or international levels, regardless of Kyoto Protocol’s entry into force. USCIB is recommending revisions to the draft standards so that they will take a voluntary, regime-neutral, simple and non-prescriptive approach. USCIB is encouraging companies to participate through their national ISO affiliate offices, and to raise these issues with appropriate governmental representatives. The ISO standard-writing process is moving very swiftly, and the standard could be completed during the next twelve months. Comments will be reviewed at the next ISO 14064 meeting in London, March 8-12. For more information, contact Norine Kennedy at (212) 703-5052 or nkennedy@uscib.org.