New Delhi: The world has just five years to initiate a low carbon industrial revolution before runaway climate change becomes almost inevitable. But the good news is that it can be done and that the long-term benefits will be immense, according to the WWF.
Climate Solutions 2 is the first analysis to put timetables to the industrial transformations needed to limit global carbon emissions below the two degrees Celsius level. Scientists say beyond that there would be unacceptable risks of runaway climate change.
The analysis was prepared for international NGO World Wide Fund for Nature (WWF) by Climate Risk, a company known for its work on climate change for global insurers and infrastructure providers.
The report found that beyond 2014 the feasible upper limits of industrial growth rates will make it impossible for market economies to meet the carbon targets required to keep global warming below two degrees Celsius. The report also found that market measures alone will not be enough to deliver emission reductions on the scale required and that delays will increase the levels of direct intervention needed in the economy.
"Climate Solutions 2 tells us that we need to start making the change to a low-carbon economy today," said Kim Carstensen, who leads WWF`s Global Climate Initiative. "The transformation will require sustained growth in clean and efficient industry in excess of 20 percent a year over a period of decades.
"The report`s modelling shows how we can sustain these growth rates but also makes it clear this will be the fastest industrial revolution witnessed in our history.
"The findings of this report offer a pragmatic, sobering and urgent warning to world leaders that the window of opportunity to act on climate change is rapidly closing. The time for playing politics with our future is long past."
The way forward, according to the report, is simultaneous action on all greenhouse gas emissions from all sectors, with market measures backed with a full range of other policies including energy efficiency standards, feed-in tariffs for renewable energy and an end to fossil fuel subsidies.
According to the report, countries not pursuing all carbon abatement options in all sectors will tend to develop least-cost industries first and only develop other low carbon industries as they become affordable.
"This analysis shows that we can win the fight against runaway climate change by transforming all sectors of our economies concurrently, by creating stable long-term investment environments that don`t seek immediate returns and through focusing on key industry sectors," said Stephan Singer, who leads WWF`s Global Energy Initiative.
The industries that will lead the transformation are renewable energy generation, carbon capture and storage, energy efficiency, sustainable low-carbon agriculture and sustainable forestry.
With the clean industrial revolution under way and sustained by a strong policy framework all renewable energies become competitive with fossil fuels between 2013 and 2025 - a highly conservative estimate based on just two percent annual rises in fossil fuel prices and no price on carbon.
Climate Solutions 2 calculates that the extra investment worldwide is expected to be $17 trillion up to 2050 - or less than 15 percent of the funds currently managed by institutional investors. The returns on that investment are expected to flow back from 2027 and in some cases even earlier.
For renewable technologies, the cumulative investment to 2050 worldwide will total $7 trillion, but it is expected to generate returns to investors of around six times as much.