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The $4 Trillion Mistake: Climate Action Delayed Is Climate Action Denied

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"The $4 Trillion Mistake: Climate Action Delayed Is Climate Action Denied"

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IEA14a

CREDIT: IEA

The International Energy Agency (IEA) has issued another major report warning that we are headed for a beyond-catastrophic 11°F warming (6°C). The IEA report, “Energy Technology Perspectives” (ETP 2014), explains that delaying climate action has cost the world trillions of dollars in just the past two years

The good news is that the new report “confirms that global population and economic growth can be decoupled from energy demand.”

The IEA says that an aggressive effort to deploy renewable energy and energy efficiency (and energy storage) to keep global warming below the dangerous threshold of 2°C — their 2DS scenario — would require investment in clean energy of only about 1% of global GDP per year. But it would still be astoundingly cost-effective:

The $44 trillion additional investment needed to decarbonise the energy system in line with the 2DS by 2050 is more than offset by over $115 trillion in fuel savings – resulting in net savings of $71 trillion.

This is in line with the latest finding by the world’s scientists and governments that stabilizing at 2°C would have a net effect on growth of 0.06% per year — essentially no effect at all compared to the staggering amount of climate damages avoided.

While serious progress would be low-cost, the new report explains that “the overall picture of progress remains bleak.” That’s why the new $44 trillion estimate for stabilizing below 2°C replaces a $36 trillion estimate in ETP 2012:

Some of the increase is due to accounting changes, but the calculations show that the cost of decarbonising the energy system – in real terms – is about 10% higher than it was two years ago. In part, this illustrates something the IEA has been saying for some time: the longer we wait, the more expensive it becomes to transform our energy system.

So the most recent two-year delay has added nearly $4 trillion to the cost of averting climate catastrophe. And the report makes crystal clear that is where we are headed, by analyzing three possible energy futures to 2050:

  • 6°C Scenario (6DS), where the world is now heading with potentially devastating results
  • 4°C Scenario (4DS) reflects stated intentions by countries to cut emissions and boost energy efficiency
  • 2°C Scenario (2DS) offers a vision of a sustainable energy system of reduced greenhouse gas and carbon dioxide (CO2) emissions.

In 2011, IEA chief economist Fatih Birol said of 6°C warming — by 2100 — “even school children know this will have catastrophic implications for all of us.” Of course he meant school children in other countries where they are taught the basic science.

It bears repeating that warming beyond 7°F (4°C) is “incompatible with organized global community, is likely to be beyond ‘adaptation’, is devastating to the majority of ecosystems & has a high probability of not being stable (i.e. 4°C [7F] would be an interim temperature on the way to a much higher equilibrium level,” as climate expert Kevin Anderson explains here. The latest research makes clear that such warming would make it exceedingly difficult if not impossible to feed 9 billion people post-2050 — and would likely force us to ultimately abandon major coastal cities around the world.

If you want to know what bleak progress looks like, the IEA has the chart for you (where “carbon intensity” is a measure of carbon pollution produced per unit of energy supply delivered):

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The IEA explains “emissions per unit of electricity must be drastically decreased to meet 2DS targets … a reduction of more than 90%” by 2050. What does this mean for that ever popular bridge fuel:

After 2025 in the 2DS, emissions from gas-fired plants are higher than the average carbon intensity of the global electricity mix; natural gas loses its status as a low-carbon fuel.

Again, what precisely is the value of spending tens of billions of dollars on new long-lived natural gas infrastructure and power plants if we need to start getting off of natural gas in about a decade? Worse, the IEA doesn’t even look at the climate impact from the high levels of methane emissions we’re seeing in the natural gas production and distribution system, which renders gas-fired plants actually worse than coal-fired plants from a climate perspective over a multi-decade period.

The IEA was once a staid and conservative organization that the opinion-makers ignored because it was staid and conservative. Now opinion-makers ignore the IEA because it has become a blunt truth teller on climate.

That’s why the right-wing tactic of saying it’s too expensive to cut carbon pollution is so destructive. Every year that argument wins, the cost of action goes up.

Climate action delayed is climate action denied.

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