IR/EC 330 THE ECONOMICS AND BUSINESS OF CLIMATE CHANGE IES Abroad London

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1 IR/EC 330 THE ECONOMICS AND BUSINESS OF CLIMATE CHANGE IES Abroad London DESCRIPTION: This course examines the evidence of the economic impacts of climate change and explores the economics of stabilizing greenhouse gasses in the atmosphere. This course also considers the complex policy challenges involved in managing the transition to a low carbon economy and ensuring that societies can adapt to the consequences of climate change. The course takes an international perspective, as climate change is global in its causes and consequences, and international collective action will be critical in driving an effective, efficient and equitable responses on the scale required. This course examines the challenges and openings for business, including sustainable development and climate change; climate change mitigation and energy efficiency; business aspects of renewable energy; carbon finance and carbon market development; the greening of business; climate change and adaptation; and sustainability and innovation. CREDITS: 3 credits CONTACT HOURS: 45 hours LANGUAGE OF INSTRUCTION: English PREREQUISITES: Introductory micro/macroeconomics. Alternatively, previous business, international relations, environmental studies. METHOD OF PRESENTATION: Lectures Discussion Student presentations Course-related trips to the EBRD and meetings with the Sustainable Energy Initiative team are incorporated in the course. REQUIRED WORK AND FORM OF ASSESSMENT: Mid-term paper (typed 2000 words) 25% The mid-term paper is a take home exam allowing students to choose from one of three questions that will be distributed a week in advance. The paper is open book and allows students to draw in their required reading and any supplemental reading. Papers should be 1500 words in length. Individual case studies (a written and oral presentation) 15% The individual case studies will show the ability of the students to discuss real life situations and companies, and assess the challenges and opportunities opened by climate change. Participation in discussion 10% Participation in discussion is a key component of the course. Students contributions should reflect their reading and thinking about the relevant topical issues. The style of the discussion will be informal, questioning and participative. Final Paper Course project 50% The course project includes two options: a paper containing analysis of the business opportunities in the new EU member states and an investment proposal, or a paper on the EU and climate change/energy issues. LEARNING OUTCOMES: By the end of the course students will be able to: Analyse climate change in terms of international challenges and cooperative action Describe the economics of climate change and sustainable development Refer to real life situations through case studies CONTENT:

2 Week Content Assignments Week 1 Climate Change and Its Impact on Economic Growth Learning objectives, required work, standards and assessment Student interests, aspirations, relevant prior course/work experience The benefits of strong early action on climate change outweigh the costs The current economic environment and climate change policy dialogue The increasing risks of serious, irreversible impacts from climate change associated with business as usual paths for emissions Washington DC, Chapter1 Understanding the Links between Climate Change and Development pp37-61 and Focus A, The Science of Climate change, pp Review Nicholas Stern, Cabinet Office - HM Treasury Chapter 12 Opportunities and wider benefits from climate policies p Week 2 The Risks Associated With Climate Change and Resource Depletion Climate change threatens the basic elements of life access to water, food production, health and use of land and environment The uneven distribution of climate change impacts, the poorest countries and people will suffer earliest Integrated assessment models for estimating the total impact on the economy Climate change and environmental policies Resource depletion, dependence and development Bio-fuels and sustainable development Washington DC, Chapter 2 Reducing Human Vulnerability: Helping People Help Themselves pp and Focus B, Biodiversity and Ecosystem Services in a Changing Climate pp Prosperity, Vintage 2010 Chapter 2 The Dangers pp16-37 Review Nicholas Stern Cabinet Office - HM Treasury Chapter 16 Accelerating technological innovation Week 3 Emissions and Economic Growth Stabilization of greenhouse gas concentrations in the atmosphere is feasible and consistent with continued growth The costs of deep cuts in emissions The macroeconomic models to explore the system wide effects of the transition to a low carbon energy economy Washington DC, Chapter 4 Energizing Development without Compromising the Climate pp Prosperity, Vintage 2010 Chapter 3 How emissions can be reduced and at what costpp38-55

3 Week 4 International Cooperation for Cutting Greenhouse Gases From Kyoto to Copenhagen and beyond the global agenda for climate change mitigation The role of international cooperation and the challenges on the road to a low carbon future Country specific attitudes and policies. Case study Developing the Methodology and Piloting Low Carbon Zones in China Climate change mitigation policies and their critics Review Nicholas Stern Cabinet Office - HM Treasury Chapter 21 Framework for understanding international collective action for climate change pp 24 Promoting the transition to a low carbon global economy Washington DC, Chapter 5, Integrating Development into the Global Climate Regime pp Case study Developing the Methodology and Piloting Low Carbon Zones in China Week 5 Week 6 Week 7 The European Union and Climate Change Saving 20% of energy consumption compared with projections for 2020 by increasing energy efficiency Increasing to 20% by 2020 the share of renewable energies in overall energy consumption Developing and promoting low or even zero emitting technologies, including carbon capture and storage Case study: The emissions trading scheme Case study Interdependencies on Energy and Climate Security for China and Europe The Transition to a Low Carbon Economy: The State of Play and the Way Forward Challenges for competitiveness and opportunities for growth The possibility and feasibility of the reduction of the expected adverse impacts of climate change The major stakeholders including national governments and international organizations, IFIs, NGOs and think tanks The intellectual and policy debate on climate change The regulatory regimes and the individual businesses Mid-term papers due Leading Global Action to 2020 and Beyond in ec.europa.eu/environment/climat/ppdf/bali/post pdf. Case study: The Emissions Trading Scheme Case study: Interdependencies on Energy and Climate Security for China and Europe Prosperity, Vintage 2010, Chapter 8 The structure of a global deal pp Advance Market Commitments for Low Carbon Technology: Creating Demand in Developing Countries Meeting Report Chatham House, April 2010 The US low carbon economics tool, March 2010, The McKinsey Institute, p.1-50

4 Week 8 Week 9 The Key Policy Elements to Reduce Emissions Carbon pricing through tax, trading or government/international agreement regulation Development of a range of low carbon and high efficiency technologies Encouragement of energy efficiency policies and measures on a global, national, company and individual levels Adaptation policy for dealing with the unavoidable impacts of climate change Supporting the developing countries for effective policies and measures to reduce emissions Curbing deforestation Climate Change, Energy and the Case for a Sustainable Business More efficient power and gas market Diversification An ambitious renewable energy renewable policy Saving energy- the case studies A new role for agriculture and forestry How to reconcile the production of biomass and sustainable food industry Control of Illegal Logging and International Trade in Illegally Logged Timber Treasury, Chapter 12 Opportunities and wider benefits from climate policies and 14 Harnessing markets to reduce emissions Prosperity, Vintage 2010 Chapter 6 Policies to reduce emissions, pp99-123; Chapter 9 Building and sustaining action pp Washington DC, Focus C, Trade and climate change pp Unlocking Finance for Clean Energy: The Need for 'Investment Grade' Policy Program Paper, Kirsty Hamilton, Royal Institute for International Affairs, December 2009Private Financing of Renewable Energy: A Guide for Policymakers Paper, Royal Institute for International Affairs, December 2009 Week 10 Week 11 The Role of Technology and Business. Renewable Energy Private and Public Finance Promoting clean innovation Intelligent energy The introduction of new technologies: the impact on business Carbon emissions trading an innovative mechanism Intellectual property issues related to climate change mitigation measures Case study: Regulating Nanotechnologies in the EU and US: Toward Effectiveness and Convergence Reducing Our Carbon Footprint- Why It Matters What can be achieved on a company and personal level? How to stop the wasteful use of finite resources Washington DC, Chapter 7 Accelerating Innovation and Technology Diffusion pp Treasury, Chapter 16 Accelerating technological innovation pp Prosperity, Vintage 2010 Chapter 7 Individuals,

5 The role of recycling and low energy use technologies The impact of climate change and the business opportunities for small and medium size enterprises firms, communities: the power of example pp The Economics of Climate Change, The Stern Treasury, Chapter 23 Supporting the transition to low carbon global economy pp Week 12 Sources of New Energy: Are They Really Limitless? High winds and deep heat Green crude and the next wave Star power and eternal sunshine The new nuclear debate The Economics of Climate Change, The Stern Treasury, Chapter 17 Beyond carbon market and technology Friedman Thomas L. Hot, Flat and Crowded: Why the World Needs a Green Revolution - and How We Can Renew Our Global Future (Hardcover), 2008 Introduction, Chapter 1, Conclusion Week 13 Sustainability and Innovation Viewing environmental compliance as an opportunity Making value chains sustainable Designing sustainable products and services Developing new business models Creating next practice platforms The Economics of Climate Change, The Stern Review Nicholas Stern Cabinet Office - HM Treasury Chapter 16 Accelerating technological innovation, 24 Promoting effective international technology cooperation pp Prosperity, Vintage 2010 Chapter 10, A Planet in peril pp Week 14 Submitting of the Course Projects and presentations REQUIRED READINGS: We will use the following textbooks, official documents and other publications: Friedman, Thomas L. Hot, Flat and Crowded: Why the World Needs a Green Revolution - and How We Can Renew Our Global Future. (Hardcover), Maslin, Mark. Global Warming: A Very Short Introduction (Very Short Introductions.) (Paperback), Oxford University Press, Stern, Nicholas. A Blueprint for a Safer Planet: Prosperity Stern, Nicholas. The Economics of Climate Change: The Stern Review (Paperback) The following Royal Institute for International Affairs (Chatham House) reports and papers will be used:

6 Changing Climates: Interdependencies on Energy and Climate Security for China and Europe. Bernice Lee, Antony Froggatt et al, November Who Owns Our Low Carbon Future? Intellectual Property and Energy Technologies. Bernice Lee, Ilian Iliev and Felix Preston, September Unlocking Finance for Clean Energy: The Need for 'Investment Grade' Policy Programme. Kirsty Hamilton, December 2009 Private Financing of Renewable Energy: A Guide for Policymakers. December Renewable Energy: Generating Money. The World Today. Kirsty Hamilton, November Investors Question EU Trading. Environmental Finance. Kirsty Hamilton, December 2007-January Clean Energy Investment and the 'New Competitiveness'. Paper based on presentation to the RBS-HMG UK Low Carbon Economy conference, London, Kirsty Hamilton, June Important papers from other think tanks: The McKinsey Quarterly reports and case studies The Economist Intelligence Unit reports Alternative opinions: Booker, Christopher. The Real Global Warming Disaster: Is the Obsession with Climate Change Turning Out to Be the Most Costly Scientific Blunder in History? Continuum, Hulme, Mike. Why We Disagree About Climate Change: Understanding Controversy, Inaction and Opportunity. (Paperback), Cambridge University Press, OTHER RESOURCES: Climate action: Energy for a Changing World: ec.europa.eu/climateaction Climate change: ec.europa.eu/environment/climate/home-en.htm The sustainable energy Europe campaign: EU action against climate change: Leading Global Action to 2020 and Beyond: ec.europa.eu/environment/climat/ppdf/bali/post-2012.pdf. European Bank for Reconstruction and Development: The Financial Times: http//