Fighting climate change doesn’t have to be expensive, according to a new report that says it might be a bit cheaper than the base case for letting the planet warm up. That’s the argument from the Global Commission on the Economy and Climate, which was co-founded last year by Colombia, Ethiopia, Indonesia, Norway, South Korea, Sweden, and the U.K.
The diagram below makes the argument. In the base case, it shows, total global investment needs from 2015 to 2030 will amount to $89 trillion. Combating global warming would add $14 trillion to the bill, with $9 trillion of that going to energy efficiency and $5 trillion to low-carbon energy technology.
But savings of more than $9 trillion would come from reduced capital spending on fossil fuels, reduced spending on the electrical grid, and lower capital spending from more compact cities, says the report. Add $5 trillion in savings from lower operating expenditures, and the net savings could come to about $1 trillion over the period.
The authors of the report admit to a large speculative element. “Indicative figures only. High rates of uncertainty,” says one disclaimer. Other economic analyses have concluded that reducing greenhouse gases would cost a lot of money, although they said it would still be worth the price in terms of preventing, say, the inundation of low-lying coastal cities.
Here’s a diagram showing Atlanta’s urban sprawl vs. Barcelona’s compactness, which dramatizes the report’s point about the savings that could be achieved by encouraging density. Atlanta’s carbon emissions per person for transport are 10 times as high as Barcelona’s, the report says.
The purpose of the report is to get countries and companies started on taking climate change seriously. “Vacillation and wobbling is the enemy of investment,” British economist Nicholas Stern told reporters in a pre-release briefing. Stern, who chairs the new group’s economic advisory panel, headed a team for the British government that in 2006 issued a major warning about the danger of global warming.
