By Ed King
The International Energy Agency’s chief economist has warned of a doomsday climate change scenario unless investments in low carbon technology are not ramped up in the next five years.
Speaking at the Global Climate Change Forum, Fatih Birol said the door to 2 degrees could be “closed forever” if there are not “significant investment changes” by 2017.
Birol said the world is currently on a trajectory to six degrees, and argued that in the absence of concrete government support or an international emissions treaty securing investment in low carbon energy systems was difficult.
He identified “cheap or lower gas prices” as being a key factor in discouraging ambitious developments in renewable capacity
“Carbon emissions have reached record high despite the financial crisis. It puts us in a very dangerous place,” he said.
Birol also argued praise for China’s efforts to invest in renewable technology had to be put in perspective: “China generates 80% of its electricity from coal, when you compare renewable investment to that it is very small” he said.
Scientists predict that a world that warms beyond two degrees will see an increase in extreme weather and also cause existing carbon sinks to release their stores of CO2.
In 2010 141 countries taking part in UN climate talks signed up to the Copenhagen Accord, which recognised the importance of keeping the global temperature increase to below 2 degrees.
There have been a number of warnings over the past few months that it will not be possible to achieve this limit – most recently from leading UK government scientist Bob Watson.
Birol’s warning came during an afternoon of debate screened on Bloomberg to mark the launch of the Carbon Disclosure Project’s 2012 Global 500 report.
This highlighted increasing levels of concern within the business community over the effects climate change could have on their domestic and international operations. The report revealed that over a third of those businesses canvassed regard climate change as a ‘clear and present danger’.
During the TV discussion business leaders from India, Mexico, Europe, Canada and the USA lined up to critique the lack of guidance or low-carbon investment support offered by national governments.
Even in the European Union, which boasts some of the world’s toughest environmental legislation and is home to the largest carbon market on the planet, policy uncertainty at national level is making investors in clean-tech think twice.
Malcolm Preston, Global Head of Sustainability Services at PricewaterhouseCoopers argued that without regulatory certainty you could not expect “CEOs to make long term investment decisions”, Rachel Kyte from the World Bank said a global price for carbon was essential “for speed and scale” while Schroders’ Alan Brown observed that the Republican Party’s anti-green rhetoric ahead of the US Presidential elections was “very depressing”.
In contrast, the head of sustainability at IT providers SAP said larger businesses could demonstrate leadership without the support of legislation, citing his own company’s efforts in recent years.
“It’s about whether we take leadership or not,” Peter Graf said. “We cannot simply blame China or the USA.
“It’s about what companies do themselves – we saved a quarter of a billion US dollars by being more energy efficient. We must frame this as an opportunity rather than a risk – that is the leadership we need.”
Kyte, who is Vice President for the Sustainable Development Network at the World Bank added that the business community were happy to complain when regulations impinged on their operations – so there was little excuse for them not making a stand now.
“I don’t see that collective voice screaming for progressive regulation,” she said.