Cost of climate deal delay comparable to the financial crisis, researchers say
- 13 Sep 2013, 15:30
- Mat Hope
Credit: Pete Souza
The costs of delaying climate action could be
equivalent to the financial crisis, a new paper warns.
Each year, world leaders meet to try and agree
new targets to prevent the world from warming by no more than two
degrees above pre-industrial levels. Progress has been slow,
however - and the longer the impasse persists, the more costly
climate action could become.
Delaying agreement is costly
The economic costs of failing to agree a deal before 2030 "are
comparable to the costs of the financial crisis the world just
experienced", the paper's lead author, Dr Gunnar Luderer, says in a
The new paper compares the cost of action depending on whether
there is a new international agreement in 2015, 2020, or 2030. It
calculates that global economic growth could be reduced by about
two per cent if an agreement comes in 2015. Economic growth would
be reduced by around seven per cent if the new targets are set in
Luderer tells Carbon Brief that a carbon price of around $20 to
$50 per tonne would be sufficient to keep warming to below two
degrees if a new deal is agreed in 2015. But if policymakers wait
until 2030, the cost rises to above $100. The EU carbon price is
currently around €8 per tonne.
The reason for the price jump is a lot more carbon dioxide would
have been emitted than if an agreement is reached earlier, and more
drastic - and expensive - action would be needed to keep warming
below two degrees.
Relying on CCS
It's not just about getting politicians to agree, however. The
extent to which warming can be constrained depends on which low
carbon energy technologies are available.
The paper identifies bioenergy with carbon capture and storage
(CCS) technology as the most significant low carbon energy source.
Biomass plants burn natural material, such as offcuts from plants
and trees. Carbon capture and storage technology can be added onto
the plants to lock away the power plant's emissions. At the same
time, plants can be grown to absorb more carbon dioxide -
theoretically making the process carbon
negative overall (as this video explains).
The paper calculates the lowest temperature change an
international deal could aim for rises by 0.3 degrees if large
scale biomass with CCS doesn't come online.
But large scale CCS is still largely unproven. According to
consultancy Poyry, the UK has the best prospects for the
technology in Europe. But there are currently
no commercial scale CCS plants in the UK and the government
isn't expected to commit to funding any
new demonstration projects until 2015.
And the longer agreement is delayed, the more
reliant the world could become on this as-yet unproven technology,
the paper says.
Relying on unproven technology
Luderer says "continuing a wait-and-see strategy" is
a costly option, and that it could "close the door for achieving
climate targets in the long-term". International climate
negotiations have already had a number of false starts, if the
world is going to keep warming to below two degrees, it doesn't
look like it can afford many more.
The paper, 'Economic mitigation challenges: How further
delay closes the door for achieving climate targets', will be
published in Environmental Research
Letters on Tuesday.