Climate Change: Mitigating the causes and addressing its consequences

1
Climate Change Mitigating the causes and
addressing its consequences

• Robert Watson
• Chief Scientist, Sustainable Development Network,
  World Bank
• Conference of the Danish Council for Development
  Cooperation
• September 25, 2006

2
Climate Change

• Climate change is a development issue, which
  threatens poverty alleviation
• livelihoods of the poor
• human health
• Security (personal, community, national and
  regional)
• Climate change is an inter- and
  intra-generational equity issue
• industrial countries are primarily responsible
  for causing the Earths climate to change, but
  developing countries and poor people are the most
  vulnerable
• the actions of today will affect future
  generations

3
Observed temperature change over North America,
Asia and Europe and model simulation with natural
and man-made factors
1.0 0.5 0 -0.5
North America
Asia
Europe
Temperature change ?C
1900
2000
1900
2000
observations
Natural man
Natural factors
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The Global Climate of the 21st Century
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Mitigating Climate Change
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Establish a Long-term Target

• The European Union goal is to limit the rate of
  change of global mean surface temperature to
  0.20C per decade and the equilibrium temperature
  change to 20C above pre-industrial levels
• This would require limiting the atmospheric
  concentration of carbon dioxide to about 450ppm
  this would need to be translated into an
  emissions target at 2050, with intermediate
  targets at 2035 and 2020
• An equitable allocation of emissions would be
  needed
• A long-term target would send a strong signal to
  the private sector, governments and the
  technology community that there would be a market
  for efficient low-carbon production and use
  technologies
• The commercial and pre-commercial technologies of
  today can put us on the right track until about
  2050, but significant improvements will be needed
  after this time, hence the need for an aggressive
  energy public and private sector RD program

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Changes Required in Energy and Carbon Intensity
Historical rates of changes in energy intensity
are consistent with those needed for
stabilization of CO2 concentrations from 450-1000
ppm Historical rates of changes in carbon
intensity are far slower than those needed for
stabilization of CO2 concentrations from 450-1000
ppm.
8

Potential technological options

• Efficient production and use of energy coal
  plants (e.g., re-powering old inefficient plants
  and developing IGCC) vehicles (e.g., fuel cell
  cars) and reduced use of vehicles (e.g., mass
  transit and urban planning), buildings, and
  industries
• Fuel shift coal to gas
• Renewable Energy and Fuels Wind power solar
  PV and solar thermal small and large-scale
  hydropower bio-energy (?)
• CO2 Capture and Storage Capture CO2 in the
  production of electricity followed by geological
  storage (e.g., IGCC CCS)
• Nuclear fission Nuclear power
• Forests and Agricultural Soils Reduced
  deforestation reforestation afforestation and
  conservation tillage
• Other GHGs Methane, nitrous oxide, halocarbons
  and tropospheric ozone precursors

9

Costs of Reducing Carbon Dioxide Emissions
(grid-connected life-cycle)
A key challenge is to reduce the cost of IGCC and
CCS
10
Baseline and low-carbon projected energy
scenarios for non-OECD countries
Baseline
Low carbon scenario
CO2 would stabilize at about 450 ppm in the low
carbon scenario, requiring an investment of 30
billion/year in electricity generation
11
Policy Instruments

• Policies, which may need regional or
  international agreement, include
• Long-term stable global regulatory framework on
  GHG emissions with differentiated
  responsibilities
• Tradable emissions permits--domestic and global
• Energy pricing strategies and taxes
• Removing subsidies that increase GHG emissions
• Internalizing the social costs of environmental
  degradation
• Regulatory programs inc energy-efficiency
  standards
• Incentives for use of new technologies during
  market build-up
• Voluntary programs
• Education and training -- product advisories and
  labels
• Accelerated development of technologies requires
  intensified RD by governments and the private
  sector

12
The Cost of Compliance Increases with Lower
Stabilization Targets
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Funding for mitigation activities

• Only three sources of funding for mitigation are
  available
• (i) voluntary actions,
• (ii) international grants, e.g., GEF
• (iii) carbon trading.
• Resource levels and funding strategies limit
  GEFs ability to scale up market transformation
  and bring-down capital costs of technologies for
  shift to a low carbon economy - to play a
  significant role in transitioning the world to a
  low-carbon economy would require an increase in
  funds by a factor of ten or more
• Carbon trade is likely to confer the biggest flow
  of funds to developing countries - between US20
  and 120 billion per year, but requires a
  long-term global regulatory framework (i.e., a
  2050 target) with differentiated responsibilities
  with intermediate targets
• New financial instruments are required,
  especially to ensure market continuity post 2012

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Addressing the Consequences of Climate
Change
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There is a wide band of uncertainty in the
warming that would result from any stabilised
concentration of greenhouse gases

• Temperature change relative to 1990 (C)

Temperature change relative to 1990 (C )
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9
Temperature change at equilibrium
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8
Temperature change in the year 2100
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5
5
4
4
3
3
2
2
1
1
0
0
950
450
550
650
750
850
450
550
650
750
950
850
Eventual CO2 stabilisation level (ppm)
Eventual CO2 stabilisation level (ppm)
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Climate Change and Development

• Projected changes in climate variability, mean
  climate and extreme events are projected to
• Decrease water availability and water quality
  in many arid- and semi-arid regions increased
  risk of floods and droughts in many regions
• Decrease the reliability of hydropower and
  biomass production in some regions
• Increase the incidence of vector- (e.g., malaria
  and dengue) and water-borne (e.g., cholera)
  diseases, as well as heat stress mortality,
  threats nutrition in developing countries,
  increase in extreme weather event deaths
• Decrease agricultural productivity for almost
  any warming in the tropics and sub-tropics and
  adverse impacts on fisheries
• Adversely effect ecological systems, especially
  coral reefs, and exacerbate the loss of
  biodiversity

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Poor countries face the greatest threats from
climate change

• Many developing countries are in areas greatly
  affected by climate change
• The poorest populations are often particularly
  exposed
• Many developing countries are highly dependent on
  climate sensitive sectors, e.g., agriculture,
  tourism
• Many developing countries lack the physical,
  financial and human resources to institute
  adaptive measures

18
Climate variability is already a major impediment
to development
Ethiopia
25
20
15
10
5
0
0

-5
-20
1982
1984
1985
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
1983
1986
-10
-15
-40
rainfall variability
-20
-60
GDP growth
-25
Ag GDP growth
-80
-30
year
Preliminary results from A Country Water
Resources Assistance Strategy for Ethiopia From
Claudia Sadoff
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Why Climate Change is a Serious Development Issue
All countries are vulnerable to climate change
but the poorest countries and the poorest people
within them are most vulnerable. They are the
most exposed and have the least means to adapt.

• In this decade over 3 billion people in
  developing countries are likely to be affected by
  climate related disasters
• People in developing countries are affected at
  20 times the rate of those in developed countries

Source World Bank analysis based on CREDA data.
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Climate Risk Approach

• Assess and act upon threats and opportunities
  that result from both existing and future climate
  variability, including those deriving from
  climate change.
• Climate change is superimposed on existing
  climate variability

21
Development Perspective on Adaptation

• Adaptation to climate change is recognized as
  part of the development process and not separated
  from it must be integrated into national
  economic planning
• Existing capacities (and weaknesses) form the
  starting point for anticipatory adaptation
  actions
• The process must be country driven and focus on
  national needs and local priorities

22
Cost of Adaptation

• Estimates of the costs of inaction cover a huge
  range
• 10Bs to 100Bs per year in developing countries
  by mid century
• GDP losses range up to about 10 for developing
  countries for a doubling of atmospheric CO2
• A preliminary assessment shows that tens of
  billions dollars per year of ODA concessional
  finance investments are exposed to climate risks
• Comprehensive project planning and additional
  investments to climate-proof development projects
  will require at least 1 billion per year
• Primary public financial instruments available
• ODA currently only a few percent directly for
  adaptation
• GEF special funds for adaptation rising to c.
  100M pa
• Adaptation Fund funded by a 2 tax on the CDM lt
  100M pa
• These instruments are technically adequate but
  funds flowing through them need to be
  substantially increased

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Conclusions

• Human-induced climate change threatens poverty
  alleviation, sustainable economic growth and
  regional security
• Industrialized countries have been the primary
  cause to date of human-induced climate change,
  but developing countries and poor people are the
  most vulnerable
• The actions of todays generation will profoundly
  effect the Earth inherited by our children and
  future generations
• There are cost-effective and equitable solutions,
  but political will and moral leadership is needed
  
• A long-term stable regulatory framework with
  differentiated responsibilities is needed to
  stimulate the carbon market and provide the
  incentives for private sector engagement
• Innovative public-private partnerships and
  technology transfer are needed
• Market reform is needed reduction of energy
  subsidies and internalization of local/regional
  externalities (i.e., pollution costs)
• Increased public and private sector funding for
  energy R_at_D