Current emission reduction rates in major economies per unit of GDP indicate that the globe is on course for 6°C of warming rather than 2°C, warns PricewaterhouseCooper (PwC).
In an analysis out today, which looks at the progress of developed and emerging economies towards emissions reduction as linked to economic output – known as carbon intensity, it is apparent that the world has passed a “critical threshold”.
Global carbon intensity now needs to fall by over 5% a year for the next 39 years, according to the PwC Low Carbon Economy Index, a rate of reduction that has never been achieved before.
The report shows that while carbon intensity did fall slightly in 2011 by 0.7% – which is at least an improvement on the increase in 2010 – it is a fraction of what is required.
While the UK, France and Germany achieved record levels of carbon emissions intensity reductions – helped by a mild winter – efforts in emerging markets have stalled, with their total emissions by 7.4%.
A switch to shale gas – replacing 10% of global oil and coal consumption – could buy some time by delivering emissions savings of 3% a year, says the report, but PwC warns that such a path will reduce the incentive to invest in longer term solutions like nuclear and renewables.
PwC says that global governments and businesses “can no longer assume that a 2°C warming is the default scenario”.
“The new reality is a much more challenging future in terms of planning, financing and predictability,” says Jonathan Grant, director of sustainability and climate change at PwC. “The risk to business is that it faces more unpredictable and extreme weather, and disruptions to market and supply chains.”
As well as the effects of the temperature rise itself for businesses, PwC also warns that those with high carbon assets could be “stranded” if more stringent and radical climate change policies are enacted around the world.
“This isn’t about shock tactics, it’s simple maths,” adds PwC partner Leo Johnson. “While we’ve reversed the increase in emissions intensity reported last year, we’re still seeing results that are simply too little too late. We’re heading into uncharted territory for the scale of transformation and technical innovations required.”
For further information:
Estimates point to fall in EU’s 2011 greenhouse gas emissions (29-Oct)
EU greenhouse gas emissions fall 2.5% in 2011 despite growing GDP (10-Sept)
US energy-related emissions hit 20-year low (3-Aug)
UK greenhouse gas emissions down 7% in 2011 (30-Mar)
Article source: http://www.energyefficiencynews.com/i/5512/