The evidence presented in this report shows the answer to both questions is “yes”. The structural and technological changes unfolding in the global economy, combined with multiple opportunities to improve economic efficiency, now make it possible to achieve both better growth and better climate outcomes. The purpose of this report is to help economic decision-makers, in both the public and private sectors, make the most of this opportunity – and do so now.
What he probably doesn't know is that mother nature puts 24,000 times that amount of our main greenhouse gas -- water vapor -- into the atmosphere every day, and removes about the same amount every day. While this does not 'prove' that global warming is not manmade, it shows that weather systems have by far the greatest control over the Earth's greenhouse effect, which is dominated by water vapor and clouds."
Business reporting provides an important example. In recent years, more than 4,000 global companies have been reporting their GHG emissions at the behest of their major investors. But these reports are not part of these businesses’ mainstream financial reports, and are not treated in the same way, either by the companies or by their shareholders. Few companies report systematically on the climate risks they face: the extent to which business assets, activities and future profits are made vulnerable by climate change and climate change policy. These need to be understood as an increasingly significant additional risk factor facing most major businesses, requiring specific actions to limit exposure and strengthen resilience.
Countries need to feel confident that all are doing their fair share, so it is important that the new agreement be equitable. A majority of the greenhouse gases in the atmosphere today were emitted by developed economies. Yet developing countries’ emissions now exceed those of high-income countries, driven primarily by fast-growing upper-middle-income economies, and their share is increasing. Slowing emissions in developing countries is thus essential to avoiding dangerous climate change. The question is how to do this fairly, as these countries still have significant populations living in poverty, and they rightfully wish to continue developing their economies. Most also have much lower per capita emissions than developed economies.
The same applies to investors, whose asset portfolios are also subject to climate risk, including the risks of devaluation or “stranding” arising from changes in climate policy and fossil fuel prices. In the last few years a number of investors have begun to recognise this and conduct more systematic and integrated assessments of their portfolios.
A new legal agreement on climate change is essential to drive the investment and innovation in low-carbon, climate-resilient growth needed to keep global warming below 2°C. An agreement cannot force countries to tackle climate change; they act of their own volition. This is recognised in the current negotiations on a new agreement under the United Nations Framework Convention on Climate Change (UNFCCC), which rest on the foundation of “nationally determined contributions.” But what an agreement can provide is a global framework of rules and commitments, which can make stronger action much likelier.
Yet there is much greater potential. This chapter focuses on the role of international cooperation in supporting the transformation of the global economy. Although most policy-making for low-carbon and climate-resilient growth will occur at the national and sub-national levels, five key forms of international cooperation can strengthen it. They are: a new international climate agreement, increased flows of international climate finance, improved trade agreements, various kinds of voluntary initiatives at the sectoral level, and changes to the rules and norms of the global economy.
The role of intellectual property rights in limiting access to technologies by poorer countries is of particular concern. Patent pools may offer a potential solution: consortia created by owners of similar technologies pull together, and sometimes cross-license, common or complementary technologies. For the poorest countries, international support for technical capacity-building, and technology adaptation and adoption, will also be necessary. To address costs, a mechanism could be set up in conjunction with the Global Environment Facility or the new Green Climate Fund.
This period encompasses what many economic decision-makers would describe as the short (0–5 years) and medium (5–15 year) terms. These time frames have been used in this report. The importance of the next 15 years for growth and climate change are discussed later.
Support for research and development (R&D), including publicly funded R&D and links between public R&D and the private sector, to ensure a strong link to market demand. The economist William Nordhaus found that R&D can have a social return on investment of 30–70%, compared with private returns of just 6–15%. Yet energy-sector public research and development (R&D) is half what it was in late 1970s, in real terms, even amid growing concern about air pollution, energy security and climate change. The case for increased investment is bolstered by evidence that knowledge generated by clean tech has particularly high spillover benefits, comparable to those from robotics, IT and nanotechnologies.
Digital technologies are also gaining traction through a range of new business models that reduce capital- and energy intensity across the economy. Cloud computing, for example, can increase efficiency and reduce companies’ overhead costs, energy use and related emissions. As Google’s LatLong project shows, the combination of digital satellite data and cloud computing can also help communities to better understand and prepare for the effects of climate change.
IPCC, 2014. Summary for Policymakers. In Climate Change 2014: Mitigation of Climate Change. Contribution of Working Group III to the Fifth Assessment Report of the Intergovernmental Panel on Climate Change. O. Edenhofer, R. Pichs-Madruga, Y. Sokona, E. Farahani, S. Kadner, et al. (eds.). Cambridge University Press, Cambridge, UK, and New York.