An Environmental Outlook to 2050: focussing on Climate Change

Size: px

Start display at page:

Download "An Environmental Outlook to 2050: focussing on Climate Change"

Bertram Tyler
6 years ago
Views:

1 An Environmental Outlook to 2050: focussing on Climate Change Rob Dellink OECD Environment Directorate Chapter co-authors: Virginie Marchal (ENV), Detlef van Vuuren (PBL), Christa Clapp (ENV), Jean Chateau (ENV), Elisa Lanzi (ENV), Bertrand Magne (ENV), Jasper van Vliet (PBL) 7 February 2012, Tokyo

2 Set-up of the presentation Introduction Baseline projections Pathways for limiting climate change Policy steps for a low-carbon, climate resilient economy 2

3 Environmental Outlook to 2050 Structure of the Report Executive Summary 1. Introduction 2. Socioeconomic Developments 3. Climate Change 4. Biodiversity 5. Freshwater 6. Health and Environment Annex on the Modelling Framework Environment Directorate 3

4 Approach and modelling methodology Linking economic and environmental modelling a general equilibrium economic modelling framework (ENV-LINKAGES at the OECD/ENV) a comprehensive environmental modelling framework (IMAGE suite of models at the Netherlands Environmental Assessment Agency) 4

5 5 Linking economy and environment Population & demographics Capital supply Natural resources Economic growth Fuel prices Energy efficiency Yield efficiency Energy use Bioenergy Land use Local air pollution GHG emissions Deforestation Health & environment Climate change Water stress & water quality Biodiversity 5

6 Set-up of the presentation Introduction Baseline projections Pathways for limiting climate change Policy steps for a low-carbon, climate resilient economy 6

7 Billions of USD PPP 2010 Projections for GDP Global GDP is projected to quadruple by 2050; GDP growth is especially high in regions with growing population and that are far from their frontier, i.e. that have large scope for productivity improvements OECD BRIICS ROW USA China India 350, , , , , ,000 50, OECD Environmental Outlook (2012) projection using ENV-Linkages model

8 Environmental state and pressures (1) GtCO2e GtCO2e Global GHG emissions are expected to grow by 50% between now and 2050, mostly driven by GDP growth in Brazil, Indonesia, India and China and South Africa OECD CO2 A1 (energy+industrial) (23% 2050) Russia & CO2 rest (Land of A1(7%) use) Rest CH4of BRIICS N2O(44%) HFC+PFC+SF6 ROW (26%) 00 8 OECD Environmental Outlook (2012) projection using ENV-Linkages model

9 Environmental state and pressures (2) Energy-related CO2 emissions were at an all-time high in 2010 and - despite energy efficiency improvements - energy use and associated emissions are projected to continue to increase CO2 emissions from energy and industry to 2050, baseline GtCO Industrial processes power generation energy transf ormation* transport 30 industry 20 residential 10 services Other sectors OECD Environmental Outlook (2012) projection using IMAGE model 9

10 CO2 concentration (ppm) Environmental state and pressures (3) Temperature increase ( o C) In the Baseline projection, atmospheric concentration of GHGs could reach almost 685 ppm CO 2 equivalent by 2050 (and CO 2 only 530 ppm), and global temperature could increase by 3-6 C above pre-industrial by 2100 We are WAY OFF TRACK CO 2 concentrations Regional temperature increase by ppm o C OECD Environmental Outlook (2012) projection using ENV-Linkages model

The world is looking at potentially large scale social, economic and

11 Environmental state and pressures (4) Cost of damages are likely to be high if you miss the target. The world is looking at potentially large scale social, economic and environmental damages Change of annual temperature between OECD Environmental Outlook (2012) projection using ENV-Linkages model

12 Set-up of the presentation Introduction Baseline projections Pathways for limiting climate change Policy steps for a low-carbon, climate resilient economy 12

13 Two necessary policies Adaptation Mitigation Adaptation policies are needed to safeguard the well-being of current and future generations worldwide. Integrating adaptation in development co-operation is critical 13

14 Reverse GHG emission trends The 450ppm core scenario: start pricing carbon in 2013; least cost timing of action: cheap options first, use low cost technologies, rely on BECCS at the end of the century GtCO 2 e Outlook Baseline 450 ppm Core OECD Environmental Outlook (2012) projection using ENV-Linkages model

15 The cost of action is affordable for now The average GDP growth rate would slow by 0.2 percentage point between 2010 and 2050, from 3.5% to 3.3% in a context of quadrupling of world GDP. Benefits of action are not included in GDP projection Index 2010= Baseline scenario 450 ppm core scenario GDP -5.5% GHG emissions -69.5% OECD Environmental Outlook (2012) projection using ENV-Linkages model

16 2010 There are other pathways Three scenarios for the same objective: The 450ppm core scenario, based on least cost timing of action «Delayed action», based on Copenhagen pledges «Accelerated action», implying reduced reliance on new technologies Outlook Baseline 450 ppm Core GtCO 2 e Outlook Baseline Outlook Baseline 450 ppm Core ppm ppm Core Delayed Action 450 ppm Delayed Action 450 ppm Accelerated Action OECD Environmental Outlook (2012) projection using ENV-Linkages model

17 World Canada Act now, delay is costly USA Oceania EU27 & EFTA Japan & Korea Brazil South Africa India Indonesia China Rest of Annex I Russia Mexico M.East & N.Africa Delaying action would increase the global cost of mitigation by nearly 50% by 2050, and could make it unaffordable 5% 0% -5% -10% -15% -20% -25% 450 ppm Core 450 ppm delayed action -30% 17 OECD Environmental Outlook (2012) projection using ENV-Linkages model

18 Set-up of the presentation Introduction Baseline projections Pathways for limiting climate change Policy steps for a low-carbon, climate resilient economy 18

19 Policy steps to build a low-carbon economy 1. Set clear, long-term, more stringent and economy-wide GHG mitigation targets 2. Put a price on carbon, preferably through market-based instruments 3. Reform fossil fuel support policies 19

20 Why make CO2 cheaper if you re trying to make it scarcer? USD $409 billion 2010, developing country fossil fuel consumption subsidies $45-75 billion 2010, in fossil fuel support in OECD countries $ 44 billion, 2010, global renewable electricity subsidies Income gains from unilateral removal of fossil fuel consumer subsidies in emerging and developing countries (% change in HH income vs BAU) Oil-exporting countries 6% less emissions globally from removal of these fossil fuel subsidies India China Russia Rest of the World Non-EU Eastern European Countries OECD Environmental Outlook (2012) projection using ENV-Linkages model based on IEA data; OECD and IEA analysis see website: 20

21 Policy steps to build a low-carbon economy 1. Set clear, long-term, more stringent and economy-wide GHG mitigation targets 2. Put a price on carbon, preferably through market-based instruments 3. Reform fossil fuel support policies 4. Foster innovation and support new clean technologies in a «technology-neutral» way 21

22 4. Foster innovation and support new clean technologies in a «neutral» way Except in 2009 for the green stimulus, public RD&D on energy as share of total R&D budgets has declined in real terms over the last 35 years (IEA). USD Billion (2009 prices and PPP1) Energy efficiency Fossil fuel (e.g. CCS and clean coal) Renewable energy sources Hydrogen and fuel cells Nuclear Other Share of energy R&D in total R&D (right axis) Percent

23 % Impact on real income in Foster innovation and support new clean technologies in a «neutral» way Leaving out any single technology such as nuclear or carbon capture and storage (CCS) will make the costs of the transition higher 450 scenario (all technologies) 0% No CCS Nuclear phase-out Restricted Energy Efficiency & renewables -5% -10% -15% -20% -25% -30% World OECD A1 RestA1 BIICS RoW 23 OECD Environmental Outlook (2012) projection using ENV-Linkages model

24 Policy steps to build a low-carbon economy 1. Set clear, long-term, more stringent and economy-wide GHG mitigation targets 2. Put a price on carbon, preferably through market-based instruments 3. Reform fossil fuel support policies 4. Foster innovation and support new clean technologies in a «technology-neutral» way 5. Complement carbon pricing with well-designed regulations 24

25 An Environmental Outlook to 2050 Thank you! More information on the OECD Environmental Outlook to 2050: More information on the OECD modelling work: Directly contact me at: 25

OECD Environmental Outlook to 2050: The Consequences of Inaction

OECD Environmental Outlook to 2050: The Consequences of Inaction Simon Upton Environment Director, OECD New York, 21 March 2012 2 Energy efficiency Linking economy and environment Fuel prices Yield efficiency