The Climate Conferences - What role for regions and territories in the control of quotas and financing ?

Session 8 dedicated to the role of territories and sectors in the obligation to achieve results

Pierre Calame, Armel Prieur, April 2021

To download : aberry_quotas_et_justice_sociale.pdf (330 KiB), asmith_transport_carbone_banane.pdf (270 KiB), questionnements_seance8.pdf (94 KiB)

1. The current role of the territories, the challenges to be met in order to develop their potential

The necessary articulation of the scales of governance and the inadequacy of current practices and doctrines in this respect

As Marie-Guite Dufay reminded us, greenhouse gas emissions concern all areas of society and lifestyle: economic development, the agri-food system, regional planning, mobility, infrastructure, energy production and distribution. Each level of governance, from the most local to the European level, is necessarily involved and has its own levers for action. Thus, the Region, which has competences in the field of economic development, mobility, housing and agriculture, the large cities, which in the case of Lyon and Paris represent only a minority of the population, the inter-municipalities and agglomerations, and the municipalities are all necessarily involved in the fight against global warming, each through multiple public policies. However, this articulation between the levels of governance is currently very poorly managed, or even completely unthought of.

Marie-Guite Dufay recalled that in France the regions remain political dwarfs in terms of competences and financial autonomy. Each territorial level is dependent on both European decisions, for example on the Common Agricultural Policy, and, more often than not, on the State. However, as the four speakers pointed out, the culture of the State is unsuited to both effective support for territorial innovation and the articulation between the different levels of governance.

Three characteristics of the State’s action constitute, in their opinion, major obstacles to the conduct of the transition.

First of all, its authoritarian character and its propensity to initiate policies without taking into account what is already being done at the local level. Marie-Guite Dufay cites, for example, the thermal renovation of buildings, a policy that has been underway in the region for more than ten years and for which the State has just decided to set up a public service not only by not relying on what is already in place, but even by contradicting it : in her view, territorial innovation only exists when the State has decided to highlight it.

Second characteristic, corollary of the first one, it is always a « top-down » approach. As Daniel Cueff says, we should banish these Powerpoints, which are the preferred tool for explaining to us how to comply with the new policies or procedures defined by the State. But these procedures are necessarily sectoral. For his part, at the local level he began by completely eliminating the « call for projects ». These calls have the characteristic, while many solutions exist, of pretending to lock them into boxes and define the subsidy criteria to be respected. According to him, the procedure is often more costly than the action itself! And Marie-Guite Dufay acknowledges that it is not so easy to escape this logic, as the Burgundy Franche Comté region, like everyone else, launches calls for projects or calls for expressions of interest.

To link the short term and the long term, one of the most frequent procedures implemented by the State is to invite or force the territories to draw up « master plans ». Yann Françoise illustrated this tangle of schemes. In the case of a city like Paris, it is pushed to the point of caricature.

The idea that long-term coherence necessarily requires this type of sectoral plan, the implementation of which has flaws comparable to those analysed during the Assises, with obligations to achieve results set for a distant future but with no concrete annual translation, ends up substituting illusion for reality.

Finally, the third characteristic is that the State, says Marie-Guite Dufay, wants, for example in the field of thermal insulation of buildings, « figures », quantitative figures, which does not sit well with a strategy of long-term mobilisation: obligations to achieve results can have their perverse effects.

As long as the modalities of a real multi-level governance are not defined and implemented, which we know that the French decentralisation has denied the need for, territorial actions will come up against a glass ceiling.

The articulation of temporalities, policies and actors

Temporalities

In all the cases mentioned, the territories combine long-term perspectives and short-term policies. Even if a certain number of doubts are raised about the real effectiveness of long-term plans or ten-year perspectives, such as the effect of the state of climate emergency proclaimed in Lyon by a recent deliberation and setting a 30% reduction in energy expenditure by 2030, Spatial planning policies, in the broadest sense of the term, whether in terms of housing location, infrastructure design, thermal insulation or the transformation of the agri-food system, only have an effect in the long term. This is why these long-term perspectives are indispensable, with an interrelation between the two temporalities.

Thus, Marie-Guite Dufay cited the vote of the Burgundy Franche-Comté Regional Council deciding on a policy of « zero land artificialisation », a decision that revealed a strong split between the majority and the opposition. This decision obliges us to no longer consider infrastructures as we did before. This case illustrates the possibility for territories to use regulations to induce a change of logic.

Building consensus

According to Yann Françoise, actions to combat global warming in Paris have always been adopted unanimously. This illustrates, on a subject such as the preservation of a global common good, which is new in relation to the usual field of politics, the possibility, through consultation, of « getting everyone on board ». This is an essential element in relation to the questions raised in previous sessions on the risk of policy discontinuity in the event of alternation. Getting everyone on board does not only mean political agreement. Again in the case of Paris, for example, the municipality has proposed to companies a « climate commitment charter » with regular publication of the terms of its implementation, this transparency of information being an essential condition of credibility.

Transversality of climate or sustainable development issues vis-à-vis traditional policies

It was noted in the previous sessions, both at the European and national levels, that sustainable development policy, and a fortiori the policy to combat global warming, must not be just another sectoral policy, possibly incoherent with the others, thus institutionalising the schizophrenia of our societies, torn between contradictory objectives. At the territorial level, the four speakers emphasised the need to make this a cross-cutting approach, irrigating all the others : policies to reduce the ecological footprint by nature affect all areas of society and its governance.

This is why, for example, the Bourgogne Franche-Comté region has adopted an eco-conditionality rule that applies to all policies : no more regional funding, for example, without compliance with thermal insulation or renewable energy production rules. And of course, » says Marie-Guite Dufay, « the region and the local authorities must be the first to set an example in the management of their assets.

This is also what Daniel Cueff emphasises at the level of a small commune: when he became mayor before the year 2000, the very notion of sustainable development was totally ignored. When he introduced it, the first decision he made was that there would be no « deputy for sustainable development »: it was essential, he says, that it be a cross-cutting approach affecting all our policies.

Mobilisation of citizens

The ability of territories to organise dialogue with citizens and between citizens is an essential dimension of their assets in the face of transition. Sylvain Godinot stresses that today «  the biggest challenge is that of cultural change, of changing the way we think, in a society where GDP remains the main reference point… » He says that it is therefore essential to imagine the post-growth world with citizens.

To get everyone on board, says Marie-Guite Dufay, we have to manage to walk on both legs, the ecological leg and the social leg. We have to show that they are essential to each other. And this is the result of a great deal of awareness-raising work. This is why the region has promoted a network of POTEs (Ordinary Pioneers of the Energy Transition). This makes it possible both to promote citizen initiatives and to create a social dynamic. In Paris, with a similar approach, Yann Françoise tells how an Agora was created from which 25,000 « climate volunteers » were born, who exchange with each other and carry the fight against global warming to the level of the entire population.

This mobilisation implies, whenever possible, supporting the citizens’ initiatives themselves. Thus, the commitment of the Burgundy Franche Comté region in the field of wind energy has focused on supporting the development of participatory financing of wind farms by the inhabitants. This is the way of the future, she says, otherwise groups from outside the region, with centralized support from the State, will try to impose wind farms: «  this is one of the subjects, she says, that is difficult to debate in a non-passionate way in my region ".

Sylvain Godinot mentions an initiative in Lyon by the Banque Populaire, which recently created a savings product dedicated to the ecological transition. Even if this citizen financing will remain for the time being of a much lower order of magnitude than the 200 million that the city invests per year in the transition, its symbolic value is considerable because, he says, it is «  a link of proximity with the citizens  » for example to invest in covering the school with solar panels.

Daniel Cueff, to illustrate the importance of citizen initiatives, quotes the mayor of Le Mené: «  a pot boils by its base and not by its lid ". Even for elected representatives of small communities, recognising, to use Daniel Cueff’s expression, that «  everyone is competent in the field of transition  » and that it is necessary to adopt a truly bottom-up approach is not so common. Daniel Cueff also prefers the notion of « call for solutions » to that of « call for projects ». In a call for projects, the citizens are in competition, in a call for solutions, in confraternity. The municipality has adopted criteria for evaluating these solutions by creating an indicator of sustainable well-being, and the solutions supported must have no negative impact on this indicator.

The territory is thus a privileged space for dialogue between the different types of actors in the service of the same common good. This dialogue, says Yann Françoise, is essential, otherwise everyone tends to turn to the community to define solutions.

Businesses

In a largely agricultural region, such as Burgundy Franche-Comté, Marie-Guite Dufay pointed out that 37% of greenhouse gas emissions are linked to agriculture. 40% of the animals slaughtered in France are produced in Brittany. The region must therefore contribute to rethinking the regional economy by aiming for what she calls « economic biodiversity »: « so that companies are in the territory and are also in nature ».

Footprints and quotas

Taking into account the entire ecological footprint of the company occupying a territory is, according to the four speakers, a relatively new issue for local authorities. There are several reasons for this, they say. First of all, what is most immediately within the reach of a municipality is its own carbon budget, which it can control through policies of thermal insulation of buildings, management of public transport, public purchasing policy or even, says Sylvain Godinot, school catering. But the closer we get to the local scale and the more we are in an urban environment, the less the ecological footprint of society results from local greenhouse gas emissions and even less from the local authorities’ own activities.

Yann Françoise estimates, for example, that only a quarter of emissions in Paris are local, with the other three quarters coming from imports. And even then, this measure is fragile because local emissions are not always directly associated with the local population. This is the case in Paris, for example, with the two major airports, which have a huge impact on the territorial carbon footprint. He estimates that the carbon budget of public services represents only 1% of the total ecological footprint and that the influence of municipal policies concerns at best 20 to 25% of this footprint.

Nevertheless, all agreed that this is a new area of investment for local and regional authorities. The first step would be, says Yann Françoise, to « fill the knowledge gap ». We can see a vast area of citizen reflection emerging in which local and regional authorities can play a decisive role.

Are they therefore in favour of the idea of individual quotas and of making the regions the first level of organisation of a quota exchange? This is still too new a subject to conclude. Marie-Guite Dufay found the principle very interesting: «  we have done well, she said, with milk quotas and we will have to arrive at carbon quotas for the protection of living organisms, and all the regions will have to work on it ". Sylvain Godinot is more reserved about these two ideas. On the very idea of quotas, he thinks that the higher the transaction price for setting up the system, the more decentralised the system will be. He was also concerned about the mental burden that might be placed on the most modest sectors of society by the fact that they would have to pay for their transactions in two currencies, euros and carbon points. And with regard to the possible role of the region in organising the trading of allowances, he wondered whether the resulting diversity in carbon prices from one region to another would not be an obstacle to the implementation of the system: «  Parisians would have a much higher carbon price than the Bretons. Do the French agree that there should be no equalization?

Territories, learning communities

The idea of learning communities, although the term was not used, underlay several of the interventions. It is in fact the corollary of the idea of starting from solutions invented by the citizens themselves or by the communities rather than from injunctions from above. This is why, says Daniel Cueff, one of his first initiatives was to create a network of municipalities to share their solutions. There are now 250 communes in the five Breton departments that help each other.

2. Sustainable chains and traceability of greenhouse gases along a chain

Greenhouse gas traceability and accountability reform

Peggy Munich, a chartered accountant trained in Bilan Carbone with the ABC association (Association du Bilan Carbone) and a member of its board of directors, gave an overview of the prospects for transforming commodity chain accounting, distinguishing between short-term and long-term prospects.

As we have seen in previous sessions, the establishment of a greenhouse gas emissions balance for legal entities is not a new issue. As early as 2004, ADEME, which manages the database of carbon footprints of public and private legal entities, had developed a methodology. Article 75 of the 2010 Grenelle 2 law stipulates that public and private legal entities with more than 500 employees and local authorities with more than 50,000 inhabitants must assess their greenhouse gas emissions annually and specify the measures adopted to reduce them. The 2011 application decree led ADEME to make this branch of activity autonomous, giving rise to the Bilan Carbone Association.

According to Peggy Munich, in order to be effective in the short term, it is necessary to rely on the regulatory measures that already exist and on the methodologies that have already been developed and in which a certain number of chartered accountants, including herself, have specialised, making it possible to move towards a carbon register for legal entities. The scope of this regulatory system has been criticised because the penalties are not very dissuasive (less than a third of companies comply with the law; the same question has been asked about the application of the law on duty of care). Until recently, the maximum fine incurred by a legal entity that did not meet its regulatory obligations was 1,500 euros, well below the cost of establishing a real carbon account. And Sylvain Godinot made the same point about local and regional authorities.

According to Peggy Munich, the State is in a position to strengthen its incentives. The 2021 Finance Act requires that all beneficiaries of the post-Covid stimulus plan must have drawn up their GHG balance sheet by the end of 2022 (if the company has more than 50 employees). According to the law, the rest will gradually follow.

The existence of chartered accountants who are better and better trained in the methodology will gradually reinforce this dynamic (here we find the idea dear to the futurist Thierry Gaudin according to whom, for things to move, militant bodies of experts must emerge). Gradually, carbon registers will therefore become more widespread, according to her.

Similarly, rather than creating new institutions, we can rely on the approved management bodies (OGA) to transfer to them the competence to control carbon accounting. The profile of companies targeted is that of very small businesses (IR/IS). The OGAs also have the advantage of compiling sectoral data.

The Statutory Auditors would take charge of the control, or even certification, of the carbon accounts of SMEs, companies and local authorities not subject to the regulatory obligation to have an ITO. SMEs are not subject to this obligation under the 2010 law, but Peggy Munich believes that OGAs could support SMEs and the role of statutory auditors could be extended to the carbon registers of large companies.

Peggy Munich does not hide the limits of the approach defined by the Grenelle 2 law: the carbon balance sheet only applies to what is known as scope 1 and 2, the institution’s direct emissions and some emissions directly linked to it, such as business travel. We are therefore still a long way from traceability of greenhouse gases throughout the chain. We saw in session 3 that this extension to the sector could, albeit incompletely, be initiated by the application of the law on the duty of care. We will have to be careful not to count duplicates that could result from the use of Scope 3.

Peggy Munich therefore believes that all this is only a first step and that it will be necessary to come to a much more profound reform of accounting standards. Four methods are on the table on this subject, Universal Accounting (Jacques de Saint Front), SEME (Marielle MATHIEU), ADESS LOGIC (Christine CHAVIGNY) and the CARE method (a global accounting system that respects ecology and takes into account the triple depreciation of financial capital, natural capital and human capital) presented at the fifth session by Alexandre Rambaud. She nevertheless drew attention to the fact that such a reform would be long and complex. This invites, in the absence of other traceability constraints in the sector, which would result for example from the introduction of individual tradable quotas, to progress in parallel on two tracks : the fullest possible implementation of the regulatory framework that already exists and the engagement of reforms that will only succeed in the much longer term.

The ecological footprint of industries : from a flat-rate approach to real measurement

Bruno Parmentier, former director of the Angers agricultural schools and a specialist in agri-food systems, gave an unstoppable demonstration of the need, at least for certain sectors, to make an effective estimate of greenhouse gas emissions without relying on the flat-rate estimates on which, as we saw in the first session, the calculation of the ecological footprint is based today. It was also an opportunity for him to correct a number of preconceived ideas.

The weight of the food industry in the ecological footprint

Food alone accounts for 20 to 30% of greenhouse gas emissions. Agriculture is concerned in three ways: it is the main emitter; it is likely to be the first victim of global warming; it is also capable of fixing, and therefore sequestering, carbon.

Agricultural production methods are far more important than the costs of transporting agricultural products

The impact of agriculture is not only linked to the emission of carbon dioxide, it is also and above all linked to the emission of specific gases, in particular methane, CH4, and nitrous oxide, N2O, whose impacts, for an equal volume of emissions, are respectively 23 and 298 times more warming than carbon dioxide. Yet, he says, emissions of these gases are often difficult to measure. This is the case with methane, where the digestive system of cows or the fermentation of organic matter are major emitters. As for nitrous oxide emissions, they result both from the spreading of nitrogenous fertilisers and from the practice of ploughing which, in the autumn, transforms the remaining nitrogenous fertilisers into nitrous oxide dispersed by the wind. All this outweighs the carbon dioxide emissions from tractors and transport.

Two striking examples : from April onwards, French apples, stored for six months in refrigerators (which emit refrigerant gases), are ultimately more greenhouse gas emitters than apples from Chile that have been shipped from the other side of the world. Similarly, New Zealand lamb sold in France, raised all year round in the open air, does not emit more greenhouse gases than lamb raised in the Massif Central, which spends six months a year in the sheepfold, fed on imported food.

The fact that production methods are decisive means that proposing a flat average, for example the amount of greenhouse gas emissions associated with one kilo of wheat, simply does not make sense. A kilo of wheat produced by chemical input-intensive agriculture, fertilisers and pesticides, and produced on ploughed fields that will then remain bare between harvest and sowing five or six months later, and the same kilo of wheat produced organically and on soils with year-round vegetation cover, the greenhouse gas emissions are completely different.

In particular, he points out the disastrous nature of ploughing, which means that «  you fix carbon for six months of the year and for the other six months you not only don’t fix carbon but you also emit nitrous oxide ". With ploughing you lose on both counts, six months of uptake is replaced by six months of emissions. Similarly, in a country like France, land consolidation has led to a massive destruction of hedgerows: there used to be 2 million kilometres of hedgerows, now there are only 600,000. Yet hedges are formidable greenhouse gas collectors.

To put it simply, reducing the ecological footprint associated with food, says Bruno Parmentier, consists first of all in moving « from beef to carrots to carrots to beef », by reducing the quantity of meat consumed each year, but it also consists in asking how the carrots were produced and how the animals were raised: « there are carrots to beef and carrots to beef ».

From one form of agriculture to another, it’s a factor of 1 to 10 in terms of warming. And, he says, the two most useful things in France to reduce the ecological footprint of agriculture would be on the one hand « to ban the colour brown », i.e. bare fields, to be able to fix the carbon 12 months out of 12, and to replant 500 million trees. The nature of these plantations still needs to be explained: here again, a diversified forest absorbs carbon much better than cloned plantations.

Bruno Parmentier concluded by stressing the essential role of soils in carbon storage, referring to the international « 4 by 1000 Initiative » campaign. Its aim is to improve the organic matter content of soils and encourage carbon sequestration in soils, thus achieving a win-win situation: improving fertility and reducing greenhouse gases in the atmosphere. The term 4 per 1000 corresponds to the 0.4% annual growth rate of the carbon stock in soils that would stop the current increase in CO2 in the atmosphere. This illustrates that an increase in the carbon stock in agricultural and forest soils, however small, is a major lever for reducing the amount of greenhouse gases.

What is an ecologically and socially sustainable industry?

Alistair Smith, who has long been a facilitator of the Banana Link network, is one of the founders of the World Banana Forum, one of the few which, thanks to the fact that the banana sector mobilises a smaller number of players than most other sectors, manages to bring all the major players in the sector to the table to try to define, in a sector contract, what a « sustainable and fair banana sector » would be.

The banana sector is simple enough to determine its ecological footprint. For a kilo of bananas, two thirds of the footprint is linked to the distance between the place of production and the place of consumption: this is the fuel needed for transport to Europe, the electricity needed for ripening and packaging in cardboard boxes. On the production side, the ecological footprint is mainly related to fertilisers. This is therefore quite different from the case Bruno Parmentier described for wheat or beef, for example. This means that the main reduction in the ecological footprint associated with bananas would result from reducing the quantity of bananas consumed. It is indeed the largest food export by value.

But, says Alistair Smith, this greenhouse gas emissions approach is only one dimension of a sustainable banana industry. Indeed, in this case, the environmental impacts and societal costs are fundamental. We need to move towards an approach to the sector that internalises all the environmental and social costs and leads to a fair distribution of value between the different actors in the sector. « Today, externalities (not taken into account) represent 50 to 100% of the selling price of bananas on our markets.

Sources

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