Technology to break climate deadlock

Reports timed to influence the approach to Copenhagen are continuing to appear. The latest, launched a few days ago by Tony Blair, is Breaking the Climate Deadlock: Technology for a Low Carbon Future.  It comes from the The Climate Group in partnership with The Office of Tony Blair. The Climate Group is an international NGO which focuses on speeding up the shift to a low carbon economy. Its members are large businesses and government entities at city, state and regional levels who have signed up to a set of principles which fully recognise the seriousness of human-caused climate change and the urgency of the need to address it. The report was prepared by E3G, another NGO which works to deliver outcomes with strategic significance for the transition to sustainable development.

The report finds that major emissions reductions are achievable by 2020 if we focus on certain key solutions now. Substantial reduction by that mid-term date means much lower costs in the longer run as well as being necessary if we are to avoid reaching highly dangerous levels of greenhouse gases. The report also looks ahead to the further technology development and deployment required to meet the longer term 2050 targets. Four key sectors are identified:

• Power: Approximately 38% of total savings to 2050. Renewable energy, carbon capture and sequestration (CCS), nuclear power and biomass will all be critical areas.
• Transport: Approximately 26% of total savings to 2050. Key technologies include electric and hydrogen fuel cell vehicles, improved efficiency and current and next generation biofuels.
• Buildings: Approximately 17% of total savings to 2050. Key technologies include improved efficiency in building appliances.
• Industry: Approximately 19% of total savings to 2050. Key technologies include CCS for industrial processes, and industrial motor systems.

The report’s findings on the cost of the required annual investment to scale the technology up to the required level are reassuring. Approximately $1 trillion per annum between now and 2050.

This is equivalent to 40% of global infrastructure investment or 1.4% of GDP.  However because much of this investment displaces business-as-usual spending on high-carbon alternatives the incremental cost of additional investment is much smaller. Estimates suggest that a global incremental cost of additional investment of approximately $317bn annually in 2015, rising to $811bn in 2030, is required with an oil price of $60 per barrel. But if the oil price rises to $120 per barrel, this will reduce the cost by $700bn annually – making the incremental additional cost over the period very small or even zero.

Turning to the 2020 goal of a 19 Gigatonnes (Gt) reduction in global emissions the report declares the technologies required to meet them are already proven and the policies needed are known. Three areas are designated as able to deliver over 70% of the reductions: increasing energy efficiency, reducing deforestation and using lower-carbon energy sources, including nuclear and renewables.

Implementation of seven already proven policies will deliver the reductions:

• Renewable energy standards: Regulation to require or feed-in tariffs to stimulate an increased production of energy from renewable sources, in particular wind and solar, could deliver 2.1 Gt of savings.
• Industry efficiency: Improved motors and other efficiency gains could deliver 2.4Gt of savings.
• Building codes: Improving standards for new build and modernising existing building stock could save 1.3 Gt.
• Vehicle efficiency standards: Driving up standards for vehicle efficiency could save 0.4 Gt.
• Fuel carbon content standards: Reducing the carbon content of fuels could lead to 0.3 Gt of savings.
• Appliance standards: Increasing the energy efficiency of white goods and other appliances could reduce emissions by 0.3 Gt.
• Policies to reduce emissions from deforestation and forest degradation could deliver close to 9 Gt of reductions.

It is apparent that government involvement is essential:

While cap and trade systems or other means of creating a carbon price can help provide incentives for businesses to invest in low-carbon solutions, in the short term at least, it is these seven policy measures and direct action and investment by governments that will achieve the targets.

Joseph Romm in the course of his appreciative comment on the report sums that up with characteristic forthrightness:

Bottom Line: If you want the kind of fast climate action the climate crisis demands, you must combine aggressive government technology standards with a shrinking carbon cap that drives a rising carbon price.

The report goes on to point out that for the period after 2020 new technologies “many available but not yet commercially proven” will be needed to meet the more challenging long-term goals.

Therefore, at the same time as we deploy existing solutions, we must invest in future options, such as carbon capture and storage (CCS), new generation nuclear, concentrated solar power and electric vehicles, and the infrastructure, such as smart grids, necessary for them to operate at scale. Instead of locking in high-carbon infrastructure, countries must agree now to speed up the deployment of technologies with potential for long-term carbon reduction. The situation is critical. The status of current technologies shows considerable potential for the future but there is a long way to go before they reach full commercialisation.

CCS figures largely in the report, which sees it as an essential part of achieving the long-term goal. It describes a need for at least ten full-scale power demonstration plants and a further eight industry demonstration plants up and running by 2015.

Incidentally, when referring to what it calls new disruptive technologies, and the importance of governments ensuring that the innovative system works to allow their emergence, the report specifically mentions the possibility of biochar, discussed here on Hot Topic, proving to be a significant example of such technology.

A long-term global carbon price is essential to the harnessing of the private sector in the development and deployment of technology and accelerating the development of national and global carbon markets and their linkage is essential.  But the report reiterates that this alone will not be enough.

The reality is that carbon pricing does not address many other market failures along the innovation chain. Overcoming these requires world leaders to develop and implement policies focused specifically on technology development and deployment which are both practical and collaborative. Putting in place strong domestic legislation to decarbonise the power, transport, buildings and industry sectors is an essential starting point. Looking ahead, governments should adopt a strategic top-down approach to ensure that critical technologies arrive on time and provide investment in disruptive options to allow radical transformation in the future. This is not a policy of picking winners; rather it is to guarantee that there will be enough winners to pick from.

Much of the abatement will need to be in large emerging economies who will require significant financial flows to enable them to make the necessary investment. Estimates of between $100 and $160 billion annually between 2010 and 2020 are quoted. This money could be transferred either through market mechanisms such as the Clean Development Mechanism or through multilateral financing through the World Bank.

The report points out that investment in low-carbon technologies leads to substantial job creation and growth, instancing the experience of Germany in creating 100,000 jobs in the renewable sector between 2004 and 2006.

One of the ways developed countries should help to “push through” technological development is by agreeing to at least double public research, development and demonstration for low-carbon technologies by 2015 and quadruple it by 2020.

Copenhagen should enable a comprehensive international technology mechanism to be put in place…

which sets the scale and pace of market and direct finance support, defines the areas where cooperation will take place and establishes an institutional structure to measure, report and verify actions and facilitate joint ventures.

I allowed myself to feel encouraged by the practicality and purposiveness of the report. Admittedly we may yet discover that the level of reductions envisaged is still not adequate to what will be required, and of course it is not yet apparent that governments will move as far and as fast as such reports urge.  But I thought the final paragraph of the executive summary was well justified:

Successfully reducing emissions to prevent dangerous climate change is without doubt a huge challenge and will require a revolution in the way we produce and consume energy, travel and design and manage our urban and rural environments. However, the pathway to this revolution is clear and, by means of ambitious international collaboration to develop and deploy low-carbon technologies, well within our grasp. We know what we have to do; this report shows us how.