June 14, 2013

Cost of addressing (or not addressing) climate change

The IEA issued a report today "Redrawing the Climate Energy Map" that outlines four policies that can address climate change at no net economic cost. 

Governments have decided collectively that the world needs to limit the average global temperature increase to no more than 2° C and international negotiations are engaged to that end. Amid major international economic preoccupations, there are worrying signs that the issue of climate change has slipped down the policy agenda. This Special Report seeks to bring it right back on top by showing that the dilemma can be tackled at no net economic cost.

The world is not on track to meet the target agreed by governments to limit the long-term rise in the average global temperature to 2° Celsius (°C). 

Despite positive developments in some countries͕ global energy-related CO2 emissions increased by 1.4% to reach 31.6 gigatonnes (Gt) in 2012 - a historic high.

We present our 4-for-2 °C scenario in which we propose the implementation of four policy measures that can help keep the door open to the 2 °C target through to 2020 at no net economic cost.

The four policies are:

  • Adopting specific energy efficiency measures (49% of the emissions savings).
  • Limiting the construction and use of the least-efficient coal-fired power plants (21%).
  • Minimizing methane (CH4) emissions from upstream oil and gas production (18%).
  • Accelerating the (partial) phase-out of subsidies to fossil-fuel consumption (12%).

Delaying stronger climate action to 2020 would come at a cost: $1.5 trillion in low-carbon investments are avoided before 2020, but $5 trillion in additional investments would be required thereafter to get back on track.

No comments: