rio, kyoto, copenhagen, cancun, durban what's next? a ... · a skeptical view on climate...
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Rio, Kyoto, Copenhagen, Cancun, Durban ..... what's next?
A skeptical view on climate negotiations.
Carlo CarraroPresident, University of VeniceVice Chair, IPCC WG IIIChairman, Scientific Advisory Board, FEEM
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1
Introduction
- Climate change problem is an important but difficul tchallenge for human beings/our societies
- Climate change control is a global public good
- Long term dimension of the problem
- Pervasive uncertainties on the physical and economi c dimensions of the climate change problem
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2
International Negotiations
� In 1997 all UNFCCC countries (189) approved the Kyoto Protocolthat entered into force in 2006. The Kyoto Protocol however has a minor impact on GHG concentrations and temperature
� At the G8 meeting in L’Aquila, then in Pittsburgh at MEF, and finally in Copenhagen at COP XV, main countries agreed to stabilise temperature increase at 2°C (no more than 2°C...)
� Same principles have been reaffirmed in Cancun at COP XVI. However, G8/G20 countries failed to deliver an international agreement on policy and measures to achieve such target.
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3. The arithmetics of climate
The present level of concentrations is about 430 ppm CO2-eqUncertainty of the emissions-temperature nexus is relevant
Concentrations of GHG (ppm CO2-eq) Most Likely
Very Likely Above (>90%)
Likely in the Range (>66%)
350 1.0 0.5 0.6 - 1.4450 2.1 1.0 1.4 - 3.1550 2.9 1.5 1.9 - 4.4650 3.6 1.8 2.4 - 5.5750 4.3 2.1 2.8 - 6.4
1000 5.5 2.8 3.7 - 8.31200 6.3 3.1 4.2 - 9.4
Table 1. Most likely, likely and very likely bounds/ranges of global mean equilibrium surface temperature increase in degrees Celsius above pre-industrial temperature for different levels of CO2 equivalent concentrations (ppm). Source: IPCC Fourth Assessment Report, WG I, Chapter 10, Table 10.8 .
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2 °C target … some basic numbers
� According to IPCC, in order to keep temperature increase below2°C with good probability, concentrations of GHGs should not exceed 380-390 ppm CO2-eq.
� If we accept the possibility of overshooting the target, the level of concentrations can be higher but not greater than 450 ppm.
� The present level of GHG concentration is 430 ppm CO2-eq (390 CO2 only), well above the 380-390 ppm level necessary to make a temperature increase above 2°C unlikely.
� 450 ppm CO2-eq will be reached within six years, whatever world leaders decided in L’Aquila and in Copenhagen.
� If 550 ppm CO2-eq are reached, there is little chance to stay below 2°C.
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Reality check….
- If we assume that emissions will halve by 2050, declining at a constant pace from 2010, concentrations of CO2 in the atmosphere will be 40 ppm higher in 2050.
- This implies that all GHG concentrations will reach 470 ppm CO2-eq in 2050, assuming that emissions of non CO2 gases are heroically cut to zero starting from 2010.
- The emissions path envisaged by MEF leaders is thus in line with a 550 ppm target by the end of the century. Hence, more than 2 degrees...
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Even a 550 ppm target would bevery difficult to achieve…
� Given the projected dynamics of world population and economic growth, the objective of limiting concentrations below 550 ppm CO2-eq implies that average per capita emissions in the second half of this century are to be reduced from about 2 to about 0.3 tC per year.
� In other words, the world will have to emit not more than today’s India’s average – quite a significant reduction for most industrialised countries (US average per capita emissions are about 6 tC) and for countries that aim at similar lifestyle standards.
� Just to provide another benchmark, 0.3 tC is the amount of GHGs emitted by an individual flying – one way – from the EU to the US East coast!
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Required emission reductions
0
200
400
600
800
1000
1200
emissions since 1751 abatement to 2100
GtC
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If China and India don’t reduce their own emissions , there is no chance to reach even the 550 ppm target
0
2
4
6
8
10
12
14
16
18
2005 2010 2015 2020 2025 2030 2035 2040 2045 2050
Gto
n C
Other Non Annex 1
SASIA
China
3.7 Rad Forcing
3.5 Rad Forcing
Total
BaU
China
IndiaOther LDCs
OECD countries
Targets
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9. The climate equation in brief
Emissions of Greenhouse Gasses (carbon dioxide, methane, ...) remain in the atmosphere for decades or even centuries
Natural absorption is very slow for carbon dioxide
Temperature is a function of concentrations, not of emissions
In order to achieve the most ambitious targets (1.5 - 2.0*C) it is necessary to reduce the stock of GHGs: negative emi ssions
ConcentrationsEmissions Temperature Climate
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Fonte: IPCC AR4 (2007). Fonte: IPCC AR4 (2007).
10. GHGs emissions
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We need global action
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…strong pressure on energy supplyIncreasing role of renewables … but the energy mix will be dominated by fossil fuels if their negative environmental effects are not internalized through appropriate climate policies
Source: WEO 2009
What’s behind the increase in emissions?
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Increase will be large particularly in developing countries
Source: WITCH model
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Energy poverty map
About 1,8 million people without access to electric ity …
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Population growth
Three more billion people on Earth….
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16. Energy and development - 2
0
1000
2000
3000
4000
5000
6000
0 5000 10000 15000 20000 25000 30000
GDP per Capita 1960-2005 (constant 2000 US$)
Ene
rgy
use
per c
apita
(kg
of o
il eq
uiva
lent
)
World High Income Low & Middle Income
1979
Carraro and Massetti (2010)
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17. CO2 emissions and development
0
2
4
6
8
10
12
14
0 5000 10000 15000 20000 25000 30000
GDP per Capita 1960-2000 (constant 2000 US$)
CO
2 em
issi
ons
per c
apita
(Ton
)
World High Income Low & Middle Income
Carraro and Massetti (2010)
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Why it is hard to build an international agreement?
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19. Why it is hard to build consensus?
Strong inertia of the climate system requires to take costly measures now, to enjoy benefits one century from now:� intergenerational coordination problem
GHGs emissions get perfectly mixed in the global atmosphere:� international coordination problem
Large uncertainty on cost of mitigation
The most ambitious targets appear highly unrealistic:� we are about to pass the level of concentrations that would
prevent the attainment of the +2ºC target with high probability
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20 KAL's cartoon, Jun 17th 2010 | From The Economist print edition
20. Act now or later?
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21. The importance of participation
NON-OECD Emissions Trajectories
0
2
4
6
8
10
12
14
16
18
2010 2015 2020 2025 2030 2035 2040 2045 2050
GtC
Stabilization at 550 ppm CO2-eq NON-OECD - BaUNON-OECD �10% at 2050 NON-OECD �20% at 2050NON-OECD �30% at 2050 NON-OECD �40% at 2050NON-OECD �50% at 2050
Figure 1. Emissions pathways compatible with a stabilization target at 550 ppm CO2 eq at 2100 and emissions trajectories of Non-OECD countries with various degrees of commitment. Source: WITCH model, FEEM. Carraro and Massetti. www.voxeu.org, 3 September 20 09.
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22. The cost of mitigation
Fonte: RECIPE Project (2009); Discounted consumptio n loss; 3% discount rate. Concentrations level of o nly CO2.
• Strong increase of costs as the target becomes more stringent
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23. Delayed action
Source: RECIPE Project (2009); Cost of stabilizing CO2 concentrations at 450 ppm, with different hypothesis of international coo peration.
If there is delay, or non-coordinated action costs increase considerably
Delaying action beyond 2030 makes it impossible to achieve the 450ppm CO2 only target.
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24. The technology puzzle
Source: RECIPE Project (2009); cost of stabilizing CO2 concentrations at 450 ppm, with different hypothesis on the availability of technologies.
• Problems in the deployment of key carbon-free technologies increase costs
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The incentives to participate in a global
agreement
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26. Climate change impacts
� The impacts of climate change are expected to vary widely across regions. � Developing countries would be more affected than their developed counterparts� Uncertainties are large, however, as reflected by the wide variance in damage
estimates across studies
Clim a te change im pa ct
-8.00
-7.00
-6.00
-5.00
-4.00
-3.00
-2.00
-1.00
0.00
1.00
2005 2010 2015 2020 2025 2030 2035 2040 2045 2050 2055 2060 2065 2070 2075 2080 2085 2090 2095 2100
Time horizon
Per
cent
age
loss
in G
DP
LAM
SEASIA
CHINA
SASIA
SSA
MENA
TE
JPNKOR
AUCANZ
EEURO
WEURO
USA
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27. Abatement costs - carbon tax
-6.0
-5.0
-4.0
-3.0
-2.0
-1.0
0.0
1.0
20 40 60 80 100 120 140 160 180 200
Dis
coun
ted
cons
umpt
ion
loss
2
Carbon Tax (2005 $US / t CO 2 eq)
Panel A. Annex I regions 1
United States Western EU countries
Eastern EU countries Aus-Can-Nzl
Japan-Korea Non-EU Eastern Europe
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28. Abatement costs - carbon tax
-6.0
-5.0
-4.0
-3.0
-2.0
-1.0
0.0
1.0
20 40 60 80 100 120 140 160 180 200
Dis
coun
ted
cons
umpt
ion
loss
2
Carbon Tax (2005 $US / t CO 2 eq)
Panel B. Non-Annex I regions
Middle East and North Africa Africa
South Asia China
South East Asia Latin America
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29. Free Riding Incentive on the GC
USA
WEURO
EEURO
AUCANZ
JPNKOR
MENA
TE
SSA
SASIA
CHINA
SEASIA
LAM
0.0%
0.2%
0.4%
0.6%
0.8%
1.0%
1.2%
1.4%
0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0%
Fre
e r
idin
g in
cen
tive
GDP loss of a 100$/tCO2 tax
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Towards a bottom -up architecture?
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Future challenges:
� More energy, to meet an increasing energy
demand
� A “clean” energy, to control climate change
� A more equally distributed energy to favour
economic development in poorer regionand thus global economic growth
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Obstacles:
� High financial needs for investments in the energy sector
� Insufficient and weak governance of global
issues implies unavoidable climate change(more than 2 degrees C)
� Resources are also needed for investments in
adaptation to climate change
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Investments in the energy sector to stabilize GHG concentrations at 450 CO2 eq.
Level
additional annual investment needs in low-
carbon technologies and energy efficiency
relative to Reference Scenario to meet 450
Scenario in 2020
total investment in the 450 scenario in low-
carbon power generation over 2010-2030
incremental investment cost in
GDP terms
almost $ 6600 bln 2020: 0.5% of GDP
(72% renewable, 19% nuclear, 9% CCS) 2030: 1.1% of GDP
almost $ 3100 bln 2020: 0.4% of GDP
(65% renewable, 20% nuclear, 15% CCS) 2030: 0.8% of GDP
almost $ 1100 bln 2020: 0.5% of GDP
(53% renewable, 27% CCS, 19% nuclear) 2030: 1% of GDP
almost $ 1300 bln 2020: 0.3% of GDP
(77% renewable, 7% CCS, 16% nuclear) 2030: 0.6% of GDP
almost $ 200 bln 2020: 0.3% of GDP
(50% renewable, 4% CCS, 46% nuclear) 2030: 0.6% of GDP
almost $ 1500 bln 2020: 0.8% of GDP
(73% renewable, 5% CCS, 22% nuclear) 2030: 1.5% of GDP
almost $ 550 bln 2020: 0.9% of GDP
(83% renewable, 2% CCS, 16% nuclear) 2030: 1.4% of GDP
almost $ 220 bln 2020: 0.3% of GDP
(58% renewable, 12% CCS, 30% nuclear) 2030: 1% of GDP
India $ 25 bln
Russia $ 8 bln
Japan $ 17 bln
China $ 80 bln
US $ 90 bln
EU $ 70 bln
World $430 bln
OECD+ $220 bln
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Investments to adapt to climate change Source IIED (2009)
SECTORS UNFCCC
ESTIMATES SOURCES OF UNDERESTIMATIONS NEW IIED COST ESTIMATES
Agriculture $11.3-12.6
billions/year
Adaptation deficit � recovering it could
cost up to $40-60 billions $11.3-12.6 + $40-60 billions
Water $11 billions/year Transfer of water across countries, no
adaptation to altered flood risk
Significant underestimation, more
studies needed
Human health $4-12 billions/year Population grows but share of illness-
related deaths remains constant 30-50% increase in costs
Coasts $11 billions/year
Sea level rise (SLR) faster than foreseen,
residual damage estimation ($1 billion/year)
too optimistic
Overall costs could double
depending on speed of SLR, residual
damage costs t $2-3 billions/year
Infrastructures $8-130 billions/year Infrastructural deficit � removing could
cost up $315 billions/year Besides deficit, $16-63 billions/year
Ecosystems $65-80 billions/year
for protected areas
Exclusion of adaptation costs for non-
protected areas ($290 billions/year) $65-80 + $290 billions/year
About 175 billions per year
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R&D investments
0 .0 0 %
0 .0 2 %
0 .0 4 %
0 .0 6 %
0 .0 8 %
0 .1 0 %
0 .1 2 %
1 9 7 0 1 9 8 0 1 9 9 0 2 0 0 0 2 0 1 0 2 0 2 0 2 0 3 0 2 0 4 0 2 0 5 0
H is t o r ic a l B A U
T o t E ne r g y R & D A 1 C C E ne r g y In te ns it y R & D A 1 C C
D e c a r b o n iz a t io n
E f f ic ie n c y
Roughly 50 Blns a year of energy innovation investments in the next two decades
� for a total of about 650 billions/year…
Source: WITCH model
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Investments: some conclusions
Climate policy will induce higher investments in the energy sector (with respect to the BaU scenario)
Low-carbon world requires a new energy mix: conventional fossil fuels power plants are substituted by nuclear, coal power plants with CCS and renewable sources
Large investments have to be diverted – in a relatively short time frame –towards complex and risky technologies
Significant innovative efforts are required especially outside the power sector
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Green stimulus of national recovery package
Ratio of green stimulus of national recovery packages, absolute volumes in bn€
The green share of the European recovery plan (58.7% ) is high wrt other countries’ package
Source: GEF 2009, based on Bernard et al. 2009; data from HSBC 2009
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Both the increased energy demand and the climate challenge require additional investments in the energy sector
At the same time, policy signals are necessary to divert investments that would be undertaken anyway
The development and application of green technologies can be an opportunity for Europe: it does not require additional investments but a reshuffle of their mix
Net positive effect on employment
Investments in energy innovation and in climate adaptation are also necessary
Carbon markets can be an important source of revenue to finance part of these investments
Conclusions
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Thank you!
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40
40. Title
� The realism of negotiations’ objectives. Can the 2 degree targets actually be achieved? Is the focus on a global agreement meaningful?
� The incentives for different countries or regions to participate in a climate agreement
� The financial resources needed to stabilize GHG concentrations
� The time horizon of climate negotiations and the likelihood of aclimate agreement in the next decade
� The possibility to move away from traditional global negotiations, by focusing on a bottom-up domestic policy-driven approach
� The necessity to invest more resources on adaptation to climate change