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As the first meetings of the contact groups got under way today, UNFCCC Executive Secretary, Yvo de Boer, spoke of  “a good mood in the air “ and said the meetings were “going well.”

The work of the special group on the future, which began yesterday and continued today, is generating “a huge amount of interest, ” he said. Brazil (on behalf of the G77), China, the United States, Japan and the European Union have all come forward with suggestions on what the Bali roadmap should look like and what needs to be included in a long-term climate change policy. He described the fact that many countries have come prepared with their own proposals on how the process should move forward as “encouraging.”
On the recurring subject of emissions targets, Mr. de Boer emphasized that “what is clear to everyone is that industrialized countries must continue to take the lead and must reduce their emissions by 25-40% by 2020. That is the agreed range for industrialized countries.”

He explained that in order to reach these ambitious targets, it is important in future negotiations to focus on the toolbox required to forge international cooperation and create the necessary market mechanisms. The Kyoto Protocol, by putting a price on carbon, has created a “unique environmental commmodity on the international market," he said. The Protocol has developed three innovative mechanisms which give Parties a certain degree of flexibility in meeting their emission reduction targets.

Emissions trading - known as the carbon market - is “truly global and growing,” he said, amounting to 30 billion USD in 2006 and expected to be much higher this year. The International Transaction Log (ITL), the computer trading system which allows Parties to trade emission reduction rights among each other, was launched recently by the UNFCCC Secretariat, thereby rendering the market internationally operational from a technical point of view.

The Clean Development Mechanism (CDM) and Joint Implementation (JI) are the two project-based mechanisms of the Kyoto Protocol. All three mechanisms, said Mr. de Boer, play an important role in the international response to climate change by stimulating investments in innovative technology and encouraging public-private partnerships in efforts to achieve clean energy growth in developing countries.

Of particular interest to developing countries are the ongoing discussions on technology transfer. Mr. de Boer explained that he was encouraged to see not only governments, but also the private sector engaging in the technology debate and offering solutions on the way forward. He referred to a new publication by the World Business Council for Sustainable Development (WBCSD) which discusses technological solutions for a clean future and the action governments need to take to enable the private sector “to go that extra green mile.”

In connection with the recent reports by the Intergovernmental Panel on Climate change (IPCC), which have been crucial in setting the scene for this conference, Mr. de Boer mentioned a suggestion that the IPCC should be asked to update these reports in 2009, coinciding with the time negotiations on the future are expected to be completed.

Mr. de Boer described information received earlier from Washington that the US Senate and Environment and Public Works Committee had approved America’s Climate Security Act setting mandatory cuts on power plants, industry and transportation as “encouraging news.”