A Climate Change Act – Comments from a Finnish legal

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University of Eastern Finland
Law School
Legal Studies Research Papers
Paper No. 12
Robert Utter
A Climate Change Act – Comments from a Finnish legal
perspective
Robert Utter is senior associate, attorney at law at Roschier Attorneys Ltd. He is also post
doc researcher at Climate Change Law Research Group of University of Eastern Finland.
The University of Eastern Finland (UEF) Department of Law is an active continuously
developing academic community, known for its interdisciplinary research profile and
active research cooperation. The focus areas for developing the Department’s research
activities include transnational law (especially Russian and European Law), empirical legal
studies and multidisciplinary environmental law. The University of Eastern Finland
Department of Law Legal Studies Research Paper Series covers research papers from all
subject areas by members of the UEF Department of Law, doctoral students and visiting
scholars.
W/3057062/v3
Electronic copy available at: http://ssrn.com/abstract=2327533
Abstract
The Finnish Government has announced that a climate change bill will be drafted. The bill
would set a greenhouse gas emission reduction target of 80 % by the year 2050. The
planned bill would form a framework for setting climate policy, but would not contain
policies and measures intended to directly affect companies or individuals. Therefore the
planned bill would somehow need to be integrated into the Finnish legal system and its
already existing measures that have a direct or indirect influence on climate policy.
Achieving the emission reduction target is not automatic, nor would the proposed planning
and reporting instruments by themselves have such an outcome. The framework nature of
the planned bill in a way defers into the future difficult constitutional and legislative
questions relating to the sought advantages of a climate change act, such as effectiveness
and streamlining climate policy.
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Electronic copy available at: http://ssrn.com/abstract=2327533
A Climate Change Act – Comments from a Finnish legal perspective1
Robert Utter2
1.
The debate in Finland so far
As a kind of spin-off from the Big Ask campaign that had successfully brought about the
spark that set the United Kingdom towards the path of enacting its Climate Change Act,
two Finnish parliamentary bills, i.e. bills that were not backed by the government, were
introduced in the Finnish parliament in the fall of 2008. Both bills contained a proposition
to enact a climate change act.3 Both bills, however, failed to collect enough votes to
proceed in the legislature. At the same time in 2008, during the drafting of the Government
Foresight Report on Long-term Climate and Energy Policy, 4 a study on the legal viability
of enacting a Finnish climate change act similar to the UK Climate Change Act was
published.5 The study concluded that although many of the provisions of the UK Climate
Change Act could not as such be enacted into law in Finland, there were no direct legal
obstacles for enacting something similar in Finland, albeit many legal concerns and issues
would need to be addressed during the drafting of such an act.
The idea of enacting a climate change act kept on brewing in Finland and it was again
debated in the summer of 2011 during the negotiations for the political program of the
newly formed government of Prime Minister Jyrki Katainen. The political program
contains a brief announcement stating that the government intends to examine the
possibility of enacting a climate change act. However, a separate decision of moving
1
Paper presented at the Energy Transitions: Regulation of Energy Markets at National, European and
International Levels Conference in Joensuu, 4 March 2013.
2
Senior associate, attorney at law, Roschier Attorneys Ltd; post doc researcher at Climate Change Law
Research Group of University of Eastern Finland.
3
Parliamentary bills LA 74/2008 and LA 75/2008.
4
http://vnk.fi/julkaisukansio/2009/j28-ilmasto-selonteko-j29-klimat-framtidsredogoerelse-j30climate_/pdf/en.pdf [website visited 12 February 2013]
5
http://vnk.fi/julkaisukansio/2008/j16-selvitys-ison-britannian-ilmastolakiehdotuksesta/pdf/fi.pdf [website visited
12 February 2013]
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Electronic copy available at: http://ssrn.com/abstract=2327533
forward with introducing any legislative changes would be required according to the
political program.
In accordance with the government’s policy program, another study on the viability of
enacting a climate change act was commissioned and published in the spring of 2012. 6 The
study presented brief overviews of Scottish, German, Austrian and US climate change
related regulations. Furthermore, the study confirmed the conclusions of the 2008 study
noting that a climate change act could be inserted into the Finnish legal system.
In early 2013 it was decided on a ministerial level that before the end of the current
government’s term in 2015 a government bill on the subject will be prepared. It was agreed
that the emission reduction target would be 80 % reductions by the year 2050. However, a
separate decision on bringing the bill up for debate in the parliament will need to be made
once the bill has been drafted. Furthermore it was agreed that the act would be limited to
addressing the activities of government and the administration with regard to emissions
that are not included in the European Union’s Emission Trading Scheme (“EU ETS”). In
this respect the act would focus on planning and monitoring as well as clarifications of the
division of responsibilities of various branches of the administration. Thus, at least no
direct implications for enterprises, businesses or individuals would be included in the act.
Indirect effects would need to be analyzed once more details emerge on the provisions in
the upcoming bill. The act would address both mitigation of and adaptation to climate
change.7
2.
Many types of climate change acts
Climate change acts have been adopted by a number of countries since the enactment of
the Climate Change Act by the United Kingdom in 2008. When talking about a climate
change act, one generally refers to a legislative act that sets binding long term targets for
emission reductions of greenhouse gases, much in the way that the UK Climate Change
Act does. For the sake of clarity and ease, this paper focuses its discussion on a climate
change act with at least this particular feature.
6
http://www.ymparisto.fi/download.asp?contentid=136909&lan=fi [website visited 12 February 2013]
7
Notification
of
the
Finnish
Ministry
of
the
Environment,
8
February
http://www.ymparisto.fi/default.asp?contentid=428736&lan=fi [webpage visited 15 February 2013]
2013.
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A binding long-term emission reduction target means that a national jurisdiction moves
beyond the international or regional framework of legally binding measures to be taken to
mitigate and/or adapt to climate change. Such a legislative instrument will need to be
carefully designed to fit into the legal system of the national jurisdiction and at the same
time have a meaningful role to play in the achievement of the act’s goals as for climate
policy.
Thus, we already enter a crossroads. What type, or perhaps more accurately, what size of
act do we envision? Is the preferred choice an all-encompassing piece of legislation or does
the act only provide a general framework for setting future short and medium term climate
policy within the ultimate long term emission reduction target? Or is the act a hybrid, a
combination of the two? What is the act’s role in the adaptation to climate change? These
are all questions that need to be carefully and openly discussed in the political debate
before proceeding into the actual stage of drafting any climate change act.
3.
Setting the desired scope
3.1
Framework or substance?
A climate change act needs to have a clear scope, or goal if you will. Regarding the goal of
the act I’m not referring just to a percentage target concerning greenhouse gas emission
reductions. From a strictly legal or legislative point of view the emission reduction target is
perhaps of less importance. An emission reduction target rings hollow, despite of its
legally binding nature, if there are no legally binding policy measures to implement and
achieve the reduction target. However, it is entirely another matter to legislate such
measures in the climate change act itself or to lay the grounds for policies and measures in
other pieces of legislation.
Thus, the decision concerning the scope of the climate change act sets the stage regarding
what is the goal of the act, in a legislative sense. The most important question in this regard
is probably: Does the act contain substantive or material rules on policies and measures or
not? If not, then the climate change act in itself has a more limited goal than actually
achieving the emission reduction target. This is by no means a flaw in the act itself. It only
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means that other legislative measures would need to fill the gap in order to reach the set
emission reduction targets.
Mitigation of and adaptation to climate change is a complex matter. All the different
policies, measures, actions, operations that have an effect, positive or negative, on climate
change can probably be regulated in one way or another. Furthermore, and perhaps more
importantly, already existing policies and measures may contain unwanted incentives that
are actually counterproductive in the mitigation of or adaptation to climate change.
In order to make a long story short, let’s skip the obvious problem of first identifying and
assessing the effects of different policies, measures and regulations on mitigation of and
adaptation to climate change. What if a climate change act were to contain all policies,
measures and regulations? In such a case it is evident that the act would be huge in size.
Including traffic, energy, agricultural, waste, environmental, land use, and forestry policy,
to name perhaps the most obvious, into a single act seems like a Herculean exercise.
So, the question arises, whether to include any substantive provisions regarding policies
and measures in a climate change act or to leave them out altogether. If the answer is to
include policies and measures, one needs to consider, how those policies and measures are
included from the point of view of legislative technique. Parliamentary procedures can be
cumbersome and time consuming and delegated acts or administrative orders may be
preferable from the point of view of effectiveness. However, national constitutional
requirements may set more or less stringent limits on the use of delegated acts or
administrative orders.
In Finland it is a constitutional requirement that the principles governing the rights and
obligations of private individuals must be set in parliamentary acts. Naturally decrees or
other delegation of legislative powers could still be used to fill in the details, but major
shifts in the adopted policies and measures could only be achieved by amending the act of
parliament.8
8
See e.g. the following opinions of the Constitutional Committee of the Finnish Parliament: PeVL 40/2002, p.
5, PeVL 46/2002, p. 8, PeVL 47/2002, p. 4–5, PeVL 67/2002, p. 6, and PeVL 20/2004, p 4.
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Thus, the ability to use delegation of legislative powers is limited. National policies and
measures concerning mitigation of or adaptation to climate change would very likely mean
that individuals would be obligated to either do something or refrain from doing
something. For example, road tolls, energy taxes, renewable energy or energy efficiency
subsidies, restricting construction in areas susceptible to the risk of increasing floods,
would all affect the rights or obligations of individuals, and thus, the governing principles
would need to be clearly enough specified in the act itself.
Currently the objective is to draft a government bill for a Finnish climate change act that
would not include any substantive or material measures/regulations. Thus, the act would be
of a framework type. In the act itself, no obligations would be set on citizens or individual
parties, such as companies or businesses.
However, if no, or very few, substantive provisions are included in a climate change act,
one may wonder, what is left. A legally binding long-term emission reduction target may
ring hollow on its own. This type of climate change act would inevitably be intended for
governmental, municipal or other administrative authorities. But as such it could still serve
a very valuable purpose. Laying down a framework for various branches of government to
cooperate in setting and updating climate policy and strategy is in itself an important step
in achieving a more coherent approach to the challenges that lie ahead if one intends to
achieve the kind of 80 % emission reductions targets by 2050 that have been on the table.
We will return to these aspects after first elaborating on other elements of the scope of a
climate change act.
3.2
Which sectors to include?
As discussed above, a climate change act would not enter a void, but would need to form
an integral part of the national legal system. Constitutional issues and other matters of a
more fundamental character have been discussed already. But countries have in general
already adopted policies and measures in the field of climate change or closely related
fields, such as environmental, energy and transport policy. A climate change act would
need to fit into these surroundings as well. This is perhaps a more down to earth question
that boils down to, which sectors to include in the act and how should adaptation to climate
change be addressed in the act.
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When contemplating the enactment of a climate change act in Finland, one must obviously
take into account that Finland is a Member State of the European Union, and thus needs to
take into account EU legislation. Nevertheless, a lot of EU climate policy has been adopted
under Article 192 (current numbering) of the Treaty of the Functioning of the European
Union (“TFEU”) and Article 193 TFEU allows Member States to maintain or introduce
more stringent protective measures. Therefore, the door is in principle open for Member
States to e.g. adopt more stringent climate policy measures despite of EU legislation on the
matter.
Due to the fact that about half of Finnish greenhouse gas emissions are covered by the EU
ETS, it is an important question to decide, whether a Finnish climate change act would
somehow attempt to set emission reduction targets for the sectors covered by the EU ETS
or exclude the EU ETS sector altogether and accept the reductions made within that sector
as achieved in accordance with relevant EU legislation, in particular the emissions trading
directive (2003/87/EC).
The Finnish political consensus in the spring of 2013 is that the EU ETS sectors are
excluded from the preparation of the government’s climate change bill. This choice seems
rather natural, once one takes into account the fact that a Finnish climate change act would
be limited to a framework nature. However, it is at the moment somewhat unclear how the
politically agreed ambition of an emission reduction of 80 % by the year 2050 would be
calculated and defined as long as the EU does not have a target reaching so far into the
future. Provided that there still is an EU ETS sector in 2050 and that a Finnish climate
change act would exclude the EU ETS sector, these two factors would need to be
consolidated in the overall 80 % reduction target. However, this is all quite far in the future
and there are many more pressing issues to resolve in the drafting of a Finnish climate
change act.
3.3
What could be achieved with ‘just’ a framework climate change act?
To answer the question in the heading bluntly: Quite a lot, actually.
Yes, it is obvious that a framework climate change act will not function unless it is backed
by pieces of legislation that contain substantive policies and measures that have an effect
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on the mitigation of and adaptation to climate change. Such a framework climate change
act can only form one step in setting the stage for a more comprehensive climate change
policy. Moreover, if the act is designed properly and thoughtfully, the step can actually be
a very useful one.
First of all, shaping climate policy requires quite a lot of knowledge. The legislature and
administration needs to be fed with up to date, reliable, and accurate information
concerning climate change. Otherwise the risk of making poor policy choices and
suboptimal legislation increases rapidly. It is hard to say whether it is worthwhile to
somehow institutionalize the apparatus that complies and produces the required
information or whether an ad hoc framework of expert hearings and stakeholder
consultations is preferable. This is something that needs to be considered and debated
when drafting a climate change act.
In fact, a Climate Change Panel has already been established in Finland. 9 There is no act of
parliament behind the establishment. The panel was set up in December 2011 by the
Finnish Ministry of the Environment and consists of twelve scientists and scholars. Since
its establishment the panel has been active and by early February 2013 the panel had issued
five studies and one statement.
Second, a long-term emission reduction target seems rather naked if it is not broken down
into more tangible mid-term and short-term targets. However, achieving this, i.e. setting
shorter-term targets, is easy, but connecting these targets with policies and measures that
somehow react to the failure or overachievement of those targets is a tougher nut to crack
in the Finnish legal system.
Due to the fact that the Finnish constitution sets limits on how widely legislative powers
can be delegated, it seems evident that a lot of climate policy would need to be shaped
through acts of parliament. Thus it makes little difference whether a climate change act is a
framework act or if it contains substantive provisions on policies and measures.
Amendments would still have to be made in the climate change act itself (if a framework
approach were not adopted) or other acts of parliament. It is somewhat hard to imagine a
9
http://www.ilmastopaneeli.fi/fi/ilmastopaneeli/ [webpage visited 14 February 2013]
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legislative system that would self adjust in case, for example, a tightening of climate policy
would be needed. Such an approach could perhaps work for emission limits that would
typically be set for industrial operators. But due to the fact that greenhouse gas emissions
that are included in the EU ETS are beyond the scope of the planned Finnish climate
change act, there would perhaps be less room to use direct emission limits. Setting tighter
energy efficiency requirements for buildings in a fast track manner might also prove tricky
to achieve, since proper care would need to be taken so that other aspects of building
construction are not jeopardized through untested requirements.
Finally, and perhaps more importantly from a purely legal perspective, the legislature
needs to have knowledge on which existing pieces of legislation have a direct or indirect
effect on climate policies. It makes little sense to try and devise the optimal climate change
act unless there is a clear understanding of how already adopted, as well as future,
legislative policies and measures work. Identifying and removing disincentives in existing
legislation should probably be priority number one in the examination of what can be done
in shaping climate policy. And I’m not just talking about the obvious and easy ones, such
as tax or other incentives for energy investments or emission limit values. A more careful
study of rules governing, for example, land use, spatial planning and transport would need
to be carried out. There will certainly be very difficult policy decisions ahead, since a
legislative policy’s or measure’s effect may very well not be limited to climate change.
Taking away or changing such policies or measures in the name of climate policy will thus
have inevitable repercussions elsewhere in the general policy framework.
Issues concerning existing policies and measures would need to be addressed somehow. At
the very least it should be ensured that information is collected and government or
municipal policies and measures undergo a reasonable impact assessment regarding their
effects on climate policy. Perhaps the upcoming proposal for a Finnish Climate Change
Act could be a start in addressing this important issue.
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