The challenge of growth: Can economic growth be compatible with climate change mitigation targets?

9 February 2009 16:00 - 17:30 GMT+00
Public event
Streamed live online

Speakers:

Jeremy Rifkin - (pre-recorded video presentation) President, The Foundation of Economic trends

Kevin Anderson - Director, The Tyndall Centre

Chair:

Simon Maxwell - Director, ODI

Description

Critics claim that ‘low carbon’, or green growth, is not compatible with an increasingly populous, high consumption, global society. Historically, carbon emissions have risen as economies grow. Some developing countries fear their potential for growth may diminish because of internationally imposed limits on emissions.  Others see a potential new market in in exploiting the demand for emissions reductions.

So how might ‘low carbon’ or ‘green’ growth, differ from ‘mainstream’ economic growth? How will they differ in developed and developing countries? And to what extent do existing responses to climate change affect the future economic growth of developing countries?  

This meeting, the third in the Climate change and international development speaker series saw Jeremy Rifkin, President of The Foundation of Economic Trends, and Kevin Anderson, Director of the Tyndall Centre reflect on these issues.

Downloads
Presentationpdf

Simon Maxwell introduced the event by emphasising the need to mainstream climate change; we need to start connecting the dots between economic growth and climate change. Due to last week’s event being rescheduled, a recording of Jeremy Rifkin presenting the counterargument to Kevin Anderson would be screened. 

Professor Kevin Anderson (KA), Director of the Tyndall Centre for Climate Change Research, Manchester

KA started by questioning the consensual science of the IPCC. He argued that the IPCC does not reflect the ‘mean’ opinion of the scientific community.  All projected increases in temperatures beyond pre-industrial levels are dangerous, even a 2oc temperature rise. He emphasised the need to question data. GHG emissions and consumption are strongly linked; even if the UK’s carbon intensity decreases, production may have shifted overseas increasing total global GHG emissions.

KA’s presentation covered the following points:

1.       What is dangerous climate change?;

2.       Cumulative emissions – a new chronology;

3.       Misplaced optimism – ignoring the bean counters;

4.       Global GHG pathways - impossible challenges.

Dangerous climate change is a 2oc rise in temperatures since pre-industrial levels.We have experienced around a 1.8oc rise already; we are at this level now.  Although the UK and EU threshold of 2oc is politically acceptable it is still dangerous; many people will die as a result as a result of a 2oc rise; this is not avoiding dangerous climate change.

CO2 stays in the atmosphere for more than 100 years after it has been emitted. The cumulative impact of CO2 means that debating percentage reductions in emissions and long-term targets are misleading: we need to factor in the impact of cumulative emissions (i.e. the carbon budget). In order to be scientifically credible there need to be urgent and radical reductions in emissions - as opposed to long-term gradual reductions.

As part of KA’s research (seehttp://www.tyndall.ac.uk/publications/journal_papers/fulltext.pdf) the most optimistic climate change data were used. The purpose of which was to establish when the peak of emissions might be reached, assuming food emissions per capita are halved by 2050 (assuming a 9 billion world population by 2050); and 70-80% of carbon stock remains (i.e. deforestation is dramatically reduced). According to KA, factoring in latest climate change data means we have already experienced a 2.7% increase in CO2 emissions within the last 100 years; and a 3.3% increase within the last 5 years.

In comparison, Stern (2006) found that CO2 emissions had risen instead by 0.96% since 2000. KA pointed out that this is because Sterns projections are based on data from the 1990s. The actual rate of increase in emissions has been 2.8% per annum since 2000.

Modelling emissions to peak by 2015 presents a more politically acceptable message - even the UK’s Climate Change Bill extrapolates 1990’s data. Government data since 2000 is more accurate, but it is not as politically acceptable because it presents worrying results.           

So what does the failure to reduce emissions and the latest data on cumulative emissions say about a 2oc future increase in temperatures?

GHG emissions of the magnitude of 450ppmv CO2e result in a 50% chance of a 2oc rise in temperatures. But for emissions to peak at this level the carbon budget needs to remain within a carbon budget of 1400 to 2200 GtCO2e between the years 2000-2100. We are roughly here already. If emissions are to peak by 2020 we need unprecedented reductions, around a 10% reduction in emissions per year. This is simply not realistic.

For a 3oc increase in temperatures since pre-industrial levels and emissions peak by 2020, a 9% annual reduction in CO2 from energy is required. For a 4oc increase, reductions in emissions of 3.5% from energy are required, per year. According to Stern (2006), annual reductions of greater than 1% per year have only ‘been associated with economic recession or upheaval’.  

What does this mean in terms of policy?

  • For mitigation, 2oc should remain the driver of policy.

  • For adaptation, 4oc should become the driver of policy.

We should go all out for mitigation at 2oc but prepare for adaptation to 4oc. If economic growth is not possible with reduced emissions, then we need a planned economic contraction to stabilise emissions so as not to exceed a 4oc increase in temperatures. There is an urgent need for a reality check: a 4oc rise in temperatures is not business as usual but assumes that emissions reductions are in place and successful; it is the best of our efforts. The adaptation agenda needs complete re-writing. Both mitigation and adaptation rates are beyond what we have be prepared to countenance and without historical precedent. We’ve entered unchartered territory: the future needs to be different.

Jeremy Rifkin (JR), President, Foundation for Economic Trends

JR started by sharing an anecdote he judges instructive for younger generations. When Chancellor Merkel invited him to come to Berlin, the first question she asked him was: how do we grow the economy when it is in the last stages of the economic era of coal, gas, uranium? We find ourselves in the ‘sunset’ of the fossil fuel era. Sunsets take a long time, but it is becoming increasingly clear that the costs of this economic era outweigh its benefits. JR argues we are on the cusp of a third industrial revolution. There are three crises feeding off each other:

  1. the global financial meltdown;
  2. the sunset of the current energy regime;
  3. climate change and its potential impact.

We are at an historic turning point. The global economic downturn is clear. We have reached the limits of fossil fuel energy; the assumption that energy would always meet demand evaporated last year when oil reached $140 a barrel. This is the firewall, the outer limit of globalization based on fossil fuels. The arrival of China and India in the global economy has pushed demand up. Even without the financial crisis and with continued economic growth there are major problems with our current dependence on fossil fuels.

JR argues we continue to underestimate climate feedback loops. The UNFCCC forecasts a three degrees rise in temperatures in the next century. With only three degrees, there will be a completely different fauna, flora and different ecosystems. With a two degrees increase, we risk the extinction of all species of life. We need a reality check.

JR made reference to James Hansen, top NASA climate change scientist who has stated that stabilising emissions at 450ppm to achieve a 2 degrees increase in temperatures compared to pre-industrial levels will in fact mean we face an increase of 6 degrees, this century (see http://www.columbia.edu/~jeh1/2008/TargetCO2_20080407.pdf); such an increase means the end of humanity. We need to stabilise emissions at around 350ppm.  

There is room for optimism. According to JR economic revolutions occur when two things happen concurrently:

1. energy patterns change; and

2. we change the way wecommunicate.

Between the years 1830 to 1880 print technology became very cheap. This converged with steam, coal and rail to create the second industrial revolution. In the 20th century, the telephone became the command and control mechanism; this second revolution is in its sunset period. JR believes that the third industrial revolution is on its way now. We have experienced a very powerful communication revolution in the last few years; the key word is “distributive” communication. Everyone can communicate with each other at the speed of light. But because this system has been built on a centralised energy system, we have not maximised its full potential.

What are distributive energies?

Distributive energies are renewables. They are much more decentralised and localised compared to ‘elite energies’ such as coal and oil. In comparison to ‘elite energies’ such as oil, ‘distributive energies’ are found in our own back yard. We have all the energy we need surrounding us: the heat of the earth underground, hydroelectricity from tidal ways and solar energy from the sun on our roof tops. According to JR four pillars underpin the distributive energy revolution.

1.       Renewables: Europe already has the first pillar within its 20-20-20 target by 2020: 20% reductions in emissions by 2020; 20% more energy efficiency; 20% share of renewables in energy supply. But the remaining question is: how to store renewable energy?

2.       Buildings: we should turn every existing office, rural and urban building into to a power plant. It is possible that buildings can collect our energy needs. This has started already in countries such as France. If you want to move an economy, it is always about construction.

3.       Storage of energy: it is possible to store renewable energy like a digital battery through the use of hydrogen. 25 years ago it was difficult to answer the question: how do we run the EU on ‘soft’ energy such as renewable. But second generation grid technology coupled with hydrogen storage means the required magnitude can be achieved.

4.       Communication: We have the software to connect hundreds of personal computers and use distributive power. We can take grid IT to the power lines, we need a smart utility network.

The biggest beneficiaries of the third industrial revolution will be the developing world. We need to make sure that the four pillars are in place and mobilise public-private partnerships.  A business plan needs to be presented in Copenhagen 2009 and energy partnerships between the North and the South created. We are at an urgent and pivotal moment.

The EU is taking a leadership role. But we need to make sure the EU climate change and energy package happens. Even with this game plan, we need a shift from geopolitics based on competition for [elite] energy, to biosphere politics, that recognises our dependence on ecosystems. Unless we start thinking about these problems as a single species, we will not bring about the third industrial revolution that is needed

Q&A

How might the economic downturn impact on investments in clean energy technologies? According to JR a central assumption of globalisation is Americans buying stuff. But the global financial crisis has stopped this and with it, that model of globalisation. We need to start connecting the dots. The EU is in a more fortunate position in that it can take a leadership role now. It needs to get the renewable energy technology cheap and then work in partnership with those in the South. The real risk now is that politicians try and keep the old system on life support as opposed to going for the third industrial revolution.

To what extent does the EU Emissions Trading Scheme (ETS) provide incentives for technology transfer? According to JR it’s not sufficient but it has provided some immediate education, i.e. people now take account of the carbon they use. We also need carbon taxes. We need to tax negative GDP and use those resources to invest in positive GDP. Businesses are much more open to this method. ‘Cap and Trade’ schemes like the ETS are transitional. But there are many more ways to move this forward. In fact, it makes good commercial sense for businesses to start making the necessary investments now in distributive energy. The multiplier effects of laying the network down in the developing world means that most business people are thinking twice when JR asks them: What’s the alternative? What is their game plan?

Simon Maxwell asked whether the science invalidates the mechanisms designed to mitigate climate change or does it mean we need to increase their stringency? KA argues that offsetting does not reduce emissions, it just moves them. It is morally irresponsible and in the absence of global caps, dangerous. Although KA is in favour of global caps on emissions these need to be accompanied by behavioural changes and reduced consumption. We should be building the infrastructure required for developing countries to be set on a low-carbon growth path and transferring it.