November 2006
New reports on climate change highlight the urgency of tackling the problem while addressing the difficult actions that are needed to avert a global catastrophe.
Three important new reports on climate change have come out recently, which throw an important light on the magnitude of the problem and how difficult it will be to deal with it.
There is no doubt that climate change is fast rising up the global agenda.
The three recent reports are the Stern Review on the Economics of Climate Change (1) (launched in London on 30 October), a report on the emission reduction performance of developed countries (2) (issued also on 30 October by the secretariat of the United Nations Framework Convention on Climate Change) and a report on the effects of climate change on Africa (3) (produced by an influential network of development and environment groups in the UK on 29 October).
The first report affirms that economic catastrophe will result from a "business as usual" approach and calls for drastic action now. The second report shows how far away this needed action is, as the developed countries have generally increased rather than decreased their Greenhouse Gas emissions (despite their Kyoto Protocol obligations).
And the third report shows how some of the worst effects of climate change will fall on developing countries (in this case, Africa) although they have contributed little to the problem. The 700-page report by former World Bank chief economist Nicholas Stern was released with great publicity by British prime minister Tony Blair and his likely successor Gordon Brown (who as Treasury Secretary actually commissioned the report) in London on 30 October.
The Stern Review (as it is now known) had the main value of placing an economic dimension to the scientific and political policy debate on climate change. Its main message is that action has to be taken now to avert an economic catastrophe. It takes an investment of 1% of world GNP now to act in order to avert a 5 to 20 per cent fall in GNP caused by climate change in future.
But in fact it is going to be extremely difficult to get the developed countries, which are the main source of the climate problem (historically as well as presently) to even begin to undertake the massive changes needed to cut Greenhouse Gas emissions by the very steep levels required.
The Stern review accepts the emerging (or rather the emerged) scientific consensus that to avert a major environmental catastrophe, global warming must be limited to no more than 2 degrees above the pre-industrial temperature.
Taking this as the yardstick, the review says that to avert climate catastrophe the Greenhouse gas in the atmosphere must be stabilized at between 450 and 550 ppm of carbon dioxide (CO2) equivalent. The current level is 430ppm of CO2 equivalent, and it is rising at more than 2ppm each year.
"Stabilisation in this range would require emissions to be at least 25% below current levels by 2050 and perhaps much more," says Stern. "Ultimately, stabilization, at whatever level, requires that annual emissions be brought down to more than 80% below current levels."
Looking at these figures, one has to conclude that to achieve the targets will require tremendous re-organisation not only of energy use but social organization and lifestyles. But neither the political leadership and will nor the public opinion in the developed countries in recent years have been up to the task.
This seems to be evident from the Greenhouse Gas Data 2006 report by the UNFCCC (UN Framework Convention on Climate Change) secretariat.
The report said that greenhouse gas emissions by industrialized countries showed a "worrying" upward trend in the 2000-2004 period. Although the overall emissions by these countries dropped 3.3% in the 1990-2004 period, this was mostly due to a 36.8 per cent decrease by economies in transition of eastern and central Europe (EITs).
Shockingly, the other industrialized Parties of the UN Framework Convention on Climate Change registered an increase of 11%.
The Kyoto Protocol requires 35 industrialized countries and the European Community to reduce greenhouse emissions by an average of 5% below 1990 levels in its first commitment period between 2008 and 2012.
"The worrying fact is that EITs, which were mostly responsible for the overall emissions reductions of industrialized countries so far, as a group have experienced an emission increase of 4.1% in the period 2000-2004," UNFCCC Executive Secretary Yvo de Boer said when launching the report in Bonn.
"This means that industrialized countries will need to intensify their efforts to implement strong policies which reduce greenhouse gas emissions," he added. The report constitutes the first complete set of data submitted by all 41 industrialized Parties. The United States, the world's biggest emitter of greenhouse gases, is not a party.
Emission reductions are urgently required in the transport sector but they seem to be especially difficult to achieve, growing by 23.9% from 1990 to 2004, the report noted.
Despite (or perhaps due to) the bleak statistics that indicate that many developed countries are not on track to cut their emissions, the UNFCCC report held up an "escape route" for countries that cannot meet their emission reduction targets.
That escape route is for those under-performing developed countries to fund climate-friendly projects in developing countries and thus earn "credits" allowing them to continue emitting Greenhouse Gases above their permitted level.
The report says that "Despite the emission growth in some countries in the latest period 2000-2004, the Parties stand a good chance of meeting individual emissions reduction commitments if they speedily apply the additional domestic mitigation measures they are planning and use the Kyoto Protocol's market-based flexibility mechanisms.
"One promising option for meeting the targets is the use of the clean development mechanism (CDM), allowing industrialized countries to invest in sustainable development projects that reduce emissions in developing countries and thereby generate tradable emission credits.
"We are looking forward to emissions trading between all countries with emission targets under the Kyoto Protocol when the first commitment period starts in 2008," Mr. de Boer said.
"At the same time, it is clear that further global action on climate change is urgently needed to generate significant investment flows into clean technology, making use of existing and new market mechanisms."
Thus, the UNFCCC data is really gloomy as it show an overall lack of action on the part of industrialized countries, and even then excluding the US, which itself has one of the poorest records. According to one estimate, the United States' emission level in 2005 was 12% above the 1990 level and could rise to 30% above that level in 2012.
Thus, the upbeat and optimistic tone with which the UNFCCC's top official launched the report contradicts the seriousness of the situation. After all the Kyoto Protocol targets are already grossly inadequate. If many of the industrialized countries are unable to meet their reduction targets under this inadequate regime, and are on the contrary on track to actually increase their emissions, the UNFCCC should be (but is not) sounding big alarm bells.
While the United Nations Framework Convention on Climate Change (UNFCCC) is not sounding the alarm bells on the dire consequences of the lack of action by the industrialized countries to cut their emission levels, the Stern Review on the Economics of Climate Change report (or Stern report) is. The summary of this report put through several clear messages.
Firstly, strong action is needed now to avoid the worst impacts of climate change. The report endorses the view that there is overwhelming scientific evidence that climate change is a serious global threat demanding an urgent global response.
It then makes a simple conclusion - that the benefits of strong and early action far outweigh the economic costs of not acting.
The report says that climate change will affect the basic elements of life for people around the world - access to water, food production, health, and the environment. Hundreds of millions of people could suffer hunger, water shortages and coastal flooding as the world warms.
"Using the results from formal economic models, the Review estimates that if we don't act, the overall costs and risks of climate change will be equivalent to losing at least 5% of global GDP each year, now and forever. If a wider range of risks and impacts is taken into account, the estimates of damage could rise to 20% of GDP or more," says the report.
"In contrast, the costs of action - reducing greenhouse gas emissions to avoid the worst impacts of climate change - can be limited to around 1% of global GDP each year.
"The investment that takes place in the next 10-20 years will have a profound effect on the climate in the second half of this century and in the next. Our actions now and over the coming decades could create risks of major disruption to economic and social activity, on a scale similar to those associated with the great wars and the economic depression of the first half of the 20th century. And it will be difficult or impossible to
reverse these changes."
The report calls for prompt and strong action. The response must be international, based on a shared vision of long-term goals and agreement on frameworks that will accelerate action over the next decade.
Secondly, climate change could have very serious impacts on growth and development. If no actions are taken to reduce emissions, greenhouse gases in the atmosphere could reach double its pre-industrial level as early as 2035, virtually committing us to a global average temperature rise of over 2 C.
In the longer term, there would be more than a 50% chance that the temperature rise would exceed 5 degrees celcius. This rise would be very dangerous indeed; it is equivalent to the change in average temperatures from the last ice age to today. Such a radical change in the physical geography of the world must lead to major changes in the human geography.
Even at more moderate levels of warming, climate change will have serious impacts on world output, on human life and on the environment.
The report says: "All countries will be affected. The most vulnerable – the poorest countries and populations - will suffer earliest and most, even though they have contributed least to the causes of climate change. The costs of extreme weather, including floods, droughts and storms, are already rising, including for rich countries."
Adaptation to climate change - steps to build resilience and minimize costs - is essential. It is no longer possible to prevent the climate change that will take place over the next two to three decades, but it is still possible to protect our societies and economies from its impacts to some extent - for example, by providing better information, improved planning and more climate-resilient crops and infrastructure.
Adaptation will cost tens of billions of dollars a year in developing countries alone, and adaptation efforts should be accelerated. Thirdly, the costs of stabilizing the climate are significant but manageable; delay would be dangerous and much more costly. The reports says that the risks of climate change's impacts can be reduced if greenhouse gas levels in the atmosphere can be stabilized between 450 and 550ppm CO2 equivalent (CO2e). The current level is 430ppm CO2e today, and it is rising at more than 2ppm each year.
Stabilization in this range would require emissions to be at least 25% below current levels by 2050, and perhaps much more. Ultimately, stabilization - at whatever level - requires that annual emissions be brought down to more than 80% below current levels.
The report says: "This is a major challenge, but sustained long-term action can achieve it at costs that are low in comparison to the risks of inaction. Central estimates of the annual costs of achieving stabilization between 500 and 550ppm CO2e are around 1% of global GDP, if we start to take strong action now."
Fourthly, the report says that "action on climate change is required across all countries, and it need not cap the aspirations for growth of rich or poor countries."
The costs of taking action are not evenly distributed across sectors or around the world. Even if the rich world takes on responsibility for absolute cuts in emissions of 60-80% by 2050, developing countries must take significant action too. But developing countries should not be required to bear the full costs of this action alone, and they will not have to. Carbon markets in rich countries are already beginning to deliver flows of finance to support low-carbon development, including through the Clean Development
Mechanism.
A transformation of these flows is now required to support action on the scale required. Action on climate change will also create significant business opportunities, as new markets are created in low-carbon energy technologies and goods.
The report believes that world does not need to choose between averting climate change and promoting growth and development. "Changes in energy technologies and in the structure of economies have created opportunities to decouple growth from greenhouse gas emissions. Indeed, ignoring climate change will eventually damage economic growth."
Fifthly, says the report, a range of options exists to cut emissions; strong, deliberate policy action is required to motivate their take-up. Emissions can be cut through increased energy efficiency, changes in demand, and through adoption of clean power, heat and transport technologies. The power sector around the world would need to be at least 60% decarbonized by 2050 for atmospheric concentrations to stabilize at or below 550ppm CO2 and deep emissions cuts will also be required in the transport sector.
Even with very strong expansion of the use of renewable energy and other low-carbon energy sources, fossil fuels could still make up over half of global energy supply in 2050, says the report, and extensive carbon capture and storage will be necessary to allow the continued use of fossil fuels without damage to the atmosphere.
Cuts in non-energy emissions, such as those resulting from deforestation and from agricultural and industrial processes, are also essential. With strong, deliberate policy choices, it is possible to reduce emissions in both developed and developing economies on the scale necessary for stabilization in the required range while continuing to grow.
The report says that "climate change is the greatest market failure the world has ever seen, and it interacts with other market imperfections."
It advocates three policies for an effective global response: (1) the pricing of carbon, implemented through tax, trading or regulation; (2) policy to support innovation and the deployment of low-carbon technologies; and (3) action to remove barriers to energy efficiency, and to educate individuals about what they can do.
Sixthly, the report says that climate change demands an international response, based on a shared understanding of long-term goals and agreement on frameworks for action. It adds that the UNFCCC and Kyoto Protocol provide a basis for international cooperation, but proposes more action including the following as elements of future international frameworks:
Emissions trading: Expanding and linking emissions trading schemes around the world: strong targets in rich countries could drive flows amounting to tens of billions of dollars each year to support the transition to low-carbon development paths.
Technology cooperation: Informal co-ordination and formal agreements can boost investments in innovation around the world. Globally, support for energy R&D should at least double, and support for the deployment of new low-carbon technologies should increase up to five-fold.
Action to reduce deforestation: Noting that forest loss contributes more to global emissions than the transport sector, the report calls for the curbing of deforestation.
Adaptation: The poorest countries are most vulnerable to climate change. The report says climate change must be fully integrated into development policy, and rich countries must increase aid.
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(1) Stern Review on the Economics of Climate Change
(2) Greenhouse gas data 2006 by UNFCC (PDF)
(3) Africa Up in Smoke 2
