Economists debate decarbonization: optimistic and pessimistic scenarios

debate forum , Is Green Growth Possible? was hosted by the Institute for New Economic Thinking in December, consisting of papers by  economists debating whether catastrophic global warming can be stopped while maintaining current levels of economic growth. The arguments are summarized  for the non-economist in “The Case for ‘conditional optimism’ on climate change” by David Roberts in Vox (Dec. 31) .  Economists may be interested in the full papers, which  include “The Road to ‘Hothouse Earth’ is Paved with Good Intentions” and “Why Green Growth is an Illusion”, both by Enno Schröder and Servaas Storm.  The authors conclude that  “..  The world’s current economies are not capable of the emission reductions required to limit temperature rise to 2 degrees. If world leaders insist on maintaining historical rates of economic growth, and there are no step-change advances in technology, hitting that target requires a rate of reduction in carbon intensity for which there is simply no precedent. Despite all the recent hype about decoupling, there’s no historical evidence that current economies are decoupling at anything close to the rate required…. Without a concerted (global) policy shift to deep decarbonization, a rapid transition to renewable energy sources, structural change in production, consumption, and transportation, and a transformation of finance, … the decoupling will not even come close to what is needed.”

The Inconvenient Truth about Climate Change and the Economy”  by  Gregor Semieniuk, Lance Taylor, and Armon Rezai summarizes and analyzes the October 2018 IPCC report, Global Warming of 1.5 °C. ,  finding it overly optimistic about global productivity growth and fossil fuel energy use, and reiterating the argument that politics are holding back climate change solutions. They conclude that “a big mitigation push, perhaps financed by carbon taxes and/or reductions in subsidies, is possible macroeconomically even if the link between energy use and output is not severed. This, however, would require considerable modifications of countries’ macroeconomic arrangements. Needless to say, military establishments and recipients of energy subsidies wield political clout. Fossil fuel producers have at least as much. Whether national preferences will permit big shifts in the use of economic resources is the key question.”

Finally, in “Conditional Optimism: Economic Perspectives on Deep Decarbonization”, author Michael Grubb  takes issue with Schröder and Storm, saying that their papers rely on historical data and rates of change, and thus are characterized by a “pessimism about our ability to change what matters fast enough. ” Grubb states that this “may  be emblematic of a growing trend in energy-climate economics, of what we might term historical futures analysis.”  He lays out a  technical economic critique and suggests four fundamental principles for his own “conditional optimism”, which relies on analysis based on the rate of displacement of carbon intensive energy supply by the growth of alternate sources.

Paths forward for decarbonization in Canada: two new reports

TopAsksCover-600x777In June, the Columbia Institute’s Centre for Civic Governance released the first annual progress report  on the  18 federal and 24 provincial/territorial policies that it had identified in its 2016 report, Top Asks for Climate Action: Ramping Up Low Carbon Communities . The 2016 report focuses on local government issues and the policy support they  need from the federal, provincial and territorial governments in the areas of  capacity building, funding, buildings, transportation and smart growth.  The 2017 Report Card  credits the federal government for some accomplishments – such as establishing a national price on carbon – and highlights nine  key areas where “room for improvement” remains.  These are: 1) establishing scientific GHG targets that will meet Paris Agreement commitments; 2)Establishing a mechanism that will guarantee new infrastructure spending that won’t lock Canadians into a high carbon path; 3) Moving faster on eliminating fossil fuel subsidies; 4)Providing more robust tools for retrofitting homes and commercial buildings; 5)Providing all communities with energy, emissions and natural capital baseline data; 6) Prioritizing transit and active transportation over auto-only infrastructure; 7) Giving priority to community and Indigenous -owned renewable energy projects to advance energy democracy in Canada;  8) Developing a national thermal energy strategy; 9) Helping local governments transition to low carbon fleets.  A June 5  article in the National Observer summarizes the report, and provides response from the federal government.

A second  new report, Re-Energizing Canada: Pathways to a Low-Carbon Future , takes a more academic approach, but includes many of the same issues.  The report, published by Sustainable Canada Dialogues, is the product of  input from Canadian academics and First Nations, establishes a framework of our energy system, and examines the important issues in Canadian energy policy with statistics and analysis.  The report identifies governance issues as central to a successful low-carbon energy transition, and states: “we believe that the key barriers to accelerating the low-carbon energy transition are social, political and organizational.” Many of its recommendations relate to governance structures needed for policy harmonization.   Re-energizing Canada was Commissioned by Natural Resources Canada in Fall 2016, and published by  Sustainable Canada Dialogues,   a Canada-wide network of over 80 scholars from engineering, sciences and social sciences. It is an initiative of the UNESCO-McGill Chair for Dialogues on Sustainability and is housed in Montreal.

Clean Energy From Canadian Perspective: a Call for Renewable Policies in Canada and a Global Review

“A New National Prize: Making Clean Energy the Next Oil Sands” by Clare Demerse and Dan Woynillowicz appears in the September October issue of Policy magazine. The article distills the findings of the UN-backed study, Pathways to Deep Decarbonization, in which research teams from 15 countries, including Canada, proposed strategies for national energy reform that will allow us to limit global temperature rise to below 2 degrees.

The report of the U.N.-based Pathways project was presented to the Secretary General in July, to support the UN Climate Summit in September. The press release and details of the Pathways project is at: http://unsdsn.org/news/2014/07/08/ddpp-press-release/.

The Demerse/Woynillowicz article summarizes the overall findings and focuses on the Canadian findings, including that by 2050, wind and solar sources could comprise 27% of Canadian electricity generation, up from 2% today. The article concludes by proposing two simple policy changes to kick off a stronger commitment to clean energy in Canada: more favourable tax treatment for power storage and solar technologies, and consumer incentives for electric vehicles. See “A New National Prize” at: http://policymagazine.ca/pdf/9/PolicyMagazineSeptember-October-14-DemerseWoynillowicz.pdf.

Citing the “wave of hope” generated by the People’s Climate March, on SeptTER-Global-Cover-300ember 21, Clean Energy Canada released its first-ever annual review, called Tracking the Energy Revolution: Global Edition at: http://cleanenergycanada.org/2014/09/21/tracking-energy-revolution-builds-surging-wave-hope/. With maps, photos and infographics, it is loaded with statistics that reveal the extent of the global shift to renewable energy by governments and businesses.