of emissions (Egenhofer and Fujiwara 2008, Höhne and Ellermann, 2008). Transnational voluntary policy co-operations exist for the aluminum sector (under the auspices of the International Aluminum Institute, IAI), for the cement sector (Cement Sustainability Initiative, CSI, under the auspices of World Business Council for Sustainable Development), for the iron and steel sector (administered by the Iron and Steel Institute, IISI) and in the form of multi-sectoral, public/private partnerships (Asia-Pacific Partnership on Clean Development and Climate, APP). Under the IAI Agreement major primary aluminum producers, representing about 60% of the global market share (half of which is supplied by producers in non-OECD countries), committed themselves to cut perfluorocarbon (PFC) greenhouse gas process emissions by 80% and to reduce energy intensity by 10% by 2010. The Cement Sustainability Initiative, in operation since 2002, has thus far largely focused on capacity building (data collection, benchmarking and monitoring) but seems prepared to move to a second stage of concerted action, dedicated to policies and the establishment of potential intensity targets. The first stage alone has produced modest results (namely a 100 kg CO2 reduction per ton of production).<sup>46</sup> The IISI, representing roughly 200 manufactures from all over the world (including China, India and Russia), responsible for an output of 70% of global iron and steel production (and more than 2 billion tons of annual CO2 emissions), instigated programs among its members to enhance energy efficiency and recycling, establish best practices, cooperate in the research of application of low carbon technology, and provide comprehensive measurement and benchmark tools. The IISI also supports the public/private partnership APP which brings together the governments of Japan, Korea, China, India, the US, Canada and Australia, with the energy supply and energy-intensive industrial sectors. The APP aims at capacity-building, the proliferation of technology, and regulatory reform. Despite the participation of governments and industry-wide representation, no national or sectoral (‘top down’) targets are set or envisaged by the APP; rather the Program has chosen a ‘bottom-up’ action-based approach.

The private sector approach to sectoral crediting has three major flaws. First, it would need to be based on firm commitments, and yet the participation in private sector agreements is voluntary by definition. Second, even though industry today confesses wholeheartedly to the objectives of sustainable development and has proved willing to engage in a range of private or public/private transnational agreements to that purpose, the level and quality of commitments taken are meager. Only one of the agreements and transnational programs mentioned above has taken up firm targets (the IAI agreement on aluminum production); and these targets are neither overly ambitious (the commitment to reduce PFC emissions by 80% from 1990 levels was taken at a time, in 2003, when industry had basically reached this reduction already)47 nor overly obliging (the 10% energy intensity reduction promised for 2010 seemed very distant in early 2008).<sup>48</sup> Thirdly, voluntary commitments by private stakeholders are by definition outside the purview of the UNFCCC process where only states can enter into international

> 46 Climate Change Corp, Climate News for Business, 8 October 2008

> http://www.climatechangecorp.com/content.asp?ContentID=5693.

> 47 IAI: Aluminum for Future Generations, Update 2007. <u>http://www.world-aluminium.org/UserFiles/File/fl0000189.pdf.</u>

> 48 Reuters, 12 February 2008.

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