Navigation Links
Putting a price tag on the 2° climate target

Addressing climate change will require substantial new investment in low-carbon energy and energy efficiency but no more than what is currently spent on today's fossil-dominated energy system, according to new research from the International Institute for Applied Systems Analysis (IIASA) and partners.

To limit climate change to 2 Celsius, low-carbon energy options will need additional investments of about US $800 billion a year globally from now to mid-century, according to a new study published in the journal Climate Change Economics. But much of that capital could come from shifting subsidies and investments away from fossil fuels and associated technologies. Worldwide, fossil subsidies currently amount to around $500 billion per year.

"We know that if we want to avoid the worst impacts of climate change, we need to drastically transform our energy system," says IIASA researcher David McCollum, who led the study. "This is the first comprehensive analysis to show how much investment capital is needed to successfully make that transition."

The study, part of a larger EU research project examining the implications and implementation needs of climate policies consistent with the internationally agreed 2 C target, compared the results from six separate global energy-economic models, each with regional- and country-level detail. The authors examined future scenarios for energy investment based on a variety of factors, including technology progress, efficiency potential, economics, regional socio-economic development, and climate policy.

Investments in clean energy currently total around $200 to 250 billion per year, and reference scenarios show that with climate policies currently on the books, this is likely to grow to around $400 billion. However, the amount needed to limit climate change to the 2 target amounts to around $1200 billion, the study shows.

The energy investments needed to address climate change continue to be an area of large uncertainty. By comparing the results from multiple models, the scientists were able to better define the costs of addressing climate change.

"Nearly all countries say that they're on board with the 2 target; some have even made commitments to reduce their greenhouse gas emissions. But until now, it hasn't been very clear how to get to that point, at least from an investment point of view. It's high time we think about how much capital is needed for new power plants, biofuel refineries, efficient vehicles, and other technologiesand where those dollars need to flowso that we get the emissions reductions we want," says McCollum.

IIASA Energy Program Director Keywan Riahi, another study co-author and project leader, says, "Given that energy-supply technologies and infrastructure are characterized by long lifetimes of 30 to 60 years or more, there's a considerable amount of technological inertia in the system that could impede a rapid transformation. That's why the energy investment decisions of the next several years are so important: because they will shape the direction of the energy transition path for many years to come."

The study shows that the greatest investments will be needed in rapidly developing countries, namely in Asia, Latin America, and Sub-Saharan Africa.

"Energy investment in these countries is poised to increase substantially anyway. But if we're serious about addressing climate change, we must find ways to direct more investment to these key regions. Clever policy designs, including carbon pricing mechanisms, can help." says Massimo Tavoni, researcher at the Fondazione Eni Enrico Mattei, a climate research center in Italy, and overall coordinator of the LIMITS project, of which the new study is a part.

The researchers note that their analysis of future investment costs does not attempt to quantify the potentially major fuel savings from switching from fossil fuels to renewable sources, such as wind and solar energy. As shown in the IIASA-led Global Energy Assessment, such savings could offset a considerable share of increased investment on a global scale.


Contact: Katherine Leitzell
International Institute for Applied Systems Analysis

Related biology news :

1. Putting plants online: 4 leading botanical gardens to create first online catalog of all plants
2. GSA Today: Putting time in its place
3. Kirk, Spock together: Putting emotion, logic into computational words
4. Putting flesh on the bones of ancient fish
5. Putting the spring back in broken hearts
6. PD map: Putting together the pieces of the Parkinsons puzzle
7. Putting the brakes on immunity
8. Putting Adam in his rightful place in evolutionary history
9. Putting the endoparasitic plants Apodanthaceae on the map
10. Freeing loggerhead turtles comes at a price
11. Climate change may create price volatility in the corn market, say Stanford and Purdue researchers
Post Your Comments:
(Date:11/9/2015)... Calif. , Nov. 9, 2015  Synaptics Inc. ... interface solutions, today announced broader entry into the automotive ... solutions that match the pace of consumer electronics human ... biometric sensors are ideal for the automotive industry and ... Europe , ...
(Date:10/29/2015)... Oct. 29, 2015   MedNet Solutions , an ... spectrum of clinical research, is pleased to announce that ... Association (MHTA) as one of only three finalists for ... – Small and Growing" category. The Tekne Awards honor ... shown superior technology innovation and leadership. ...
(Date:10/29/2015)... 2015  Rubicon Genomics, Inc., today announced an ... its DNA library preparation products, including the ThruPLEX ... Plasma-seq kit. ThruPLEX Plasma-seq has been optimized for ... libraries for liquid biopsies--the analysis of cell-free circulating ... in cancer and other conditions. Eurofins Scientific is ...
Breaking Biology News(10 mins):
(Date:11/27/2015)... 27, 2015 /PRNewswire/--  Mallinckrodt plc (NYSE: MNK ... it has closed the sale of its global contrast ... NYSE Euronext) in a transaction valued at approximately $270 ... and a total of approximately 1,000 employees spread across ... St. Louis area. This entire workforce and ...
(Date:11/27/2015)... , November 27, 2015 ... Growing popularity of companion diagnostics is ... cancer biomarkers market with pharmaceutical companies and ... companion diagnostic tests. . ... Complete report on global cancer biomarkers ...
(Date:11/26/2015)... England , November 26, 2015 ... innovative medical device company specializing in imaging technologies, announced today ... European Commission as part of the Horizon 2020 European Union ... carry out a large-scale clinical trial in breast cancer. ... (Logo: , --> --> ...
(Date:11/25/2015)... ANNAPOLIS, Md. , Nov. 25, 2015  PharmAthene, ... of Directors has adopted a stockholder rights plan (Rights ... its net operating loss carryforwards (NOLs) under Section 382 ... --> --> PharmAthene,s use of its ... an "ownership change" as defined in Section 382 of ...
Breaking Biology Technology: