Better Growth

Better Climate

A new pathway
for growth., cities., finance., land use., energy., innovation., economic policy., global action.

Countries at all income levels have the opportunity to build lasting economic growth and at the same time reduce the immense risk of climate change. But action is needed now.

The Global Commission, advised by some of the world’s leading economists, sets out a ten point Global Action Plan for governments and businesses to secure better growth in a low-carbon economy.

Chapter zero | Ethiopia

Chapter zero | China

Chapter zero | India

Chapter zero | United States

Chapter one | Overview

The Challenge

We live in a moment of great opportunity, and great risk.

The opportunity is to harness the expanding capacities of human intelligence and technological progress to improve the lives of the majority of the world’s people. Over the last quarter of a century, economic growth, new technologies, and global patterns of production and trade have transformed our economies and societies. In developing countries, nearly 500 million people have risen out of poverty just in the last decade – the fastest pace of poverty reduction for which we have data. 1 But still 2.4 billion live on less than US$2 a day, and urbanisation, rising consumption and population growth have put immense pressure on natural resources.

The next 10–15 years could be an era of great progress and growth. 2 In this period we have the technological, financial and human resources to raise living standards across the world. Good policies that support investment and innovation can further reduce poverty and hunger, make fast-growing cities economically vibrant and socially inclusive, and restore and protect the world’s natural environments.

Chapter two | Cities

Engines of national and global growth

Cities are crucial to both economic growth and climate action. Urban areas are home to half the world’s population, but generate around 80% of global economic output, 76 and around 70% of global energy use and energy-related GHG emissions. 77 Over the next two decades, nearly all of the world’s net population growth is expected to occur in urban areas, with about 1.4 million people – close to the population of Stockholm – added each week. 78 By 2050, the urban population will increase by at least 2.5 billion, reaching two-thirds of the global population. 79

The stakes for growth, quality of life and carbon emissions could not be higher. The structures we build now, including roads and buildings, could last for a century or more, setting the trajectory for greenhouse gas emissions at a critical time for reining these in.

Chapter three | Land Use

Protecting food, forests, and people

Rapid global population growth, urbanisation, rising incomes and resource constraints are putting enormous pressure on land and water resources used by agriculture and forests, which are crucial to food security and livelihoods. Roughly a quarter of the world’s agricultural land is severely degraded, 99 and forests continue to be cleared for timber and charcoal, and to use the land for crops and pasture. 100 Key ecosystem services are being compromised, and the natural resource base is becoming less productive. At the same time, climate change is posing enormous challenges, increasing both flood and drought risk in many places, and altering hydrological systems and seasonal weather patterns.

Chapter four | Energy

Better energy, better climate

We are in a period of unprecedented expansion of energy demand. Global energy use has grown by more than 50% since 1990, 133 and must keep growing to support continued development. As much as a quarter of today’s energy demand was created in just the last decade, and since 2000, all the net growth has occurred in non-OECD countries, more than half of it in China alone. 134 Past projections often failed to anticipate these dramatic shifts, which nonetheless have affected the energy prospects of nearly all countries. The future is now even more uncertain, as projections show anything from a 20% to 35% expansion of global energy demand over the next 15 years. 135

A major wave of investment will be required to meet this demand: around US$45 trillion will be required in 2015–2030 for key categories of energy infrastructure. 136 How that money is spent is critically important: it can help build robust, flexible energy systems that will serve countries well for decades to come, or it can lock in an energy infrastructure that exposes countries to future market volatility, air pollution, and other environmental and social stresses. Given that energy production and use already accounts for two-thirds of global GHG emissions, 137 and those emissions continue to rise, a great deal is at stake for the climate as well.

Chapter five | Economics of Change

A framework for growth and change

The world is changing rapidly: the share of output from emerging markets and developing economies is rising sharply; the global population is growing and moving to rapidly expanding cities; energy systems are being built and rebuilt. At the same time, the risks of dangerous climate change are increasing.

There is a perception that there is a trade-off in the short- to medium term between economic growth and climate action, but this is due largely to a misconception (built into many model-based assessments) that economies are static, unchanging and perfectly efficient. Any reform or policy which forces an economy to deviate from this counterfactual incurs a trade-off or cost, so any climate policy is often found to impose large short- and medium-term costs.

In reality, however, there are a number of reform opportunities that can reduce market failures and rigidities that lead to the inefficient allocation of resources, hold back growth and generate excess greenhouse gas emissions. Indeed, once the multiple benefits of measures to reduce GHG emissions are taken into consideration, such as the potential health gains from better local air quality, many of the perceived net costs can be reduced or eliminated.

Chapter six | Finance

Financing a low-carbon future

Transitioning from a high-carbon to a low-carbon economy will require significant investment. Businesses, land owners, farmers and households will need to invest to improve efficiency; energy producers will need to switch to low-carbon generation. Governments will need to expand and enhance infrastructure productivity, and also seek to influence the direction of private finance through regulation, incentives, co-investment, risk-sharing instruments and other policy measures.

Much of the needed investment in low-carbon infrastructure can be handled through existing structures and mechanisms, with the help of effective policy, regulation and market signals. But for some investments – most notably a low-carbon transition in the power sector – creating efficient finance structures and attracting finance is more challenging and may require dedicated policy.

Chapter seven | Innovation

Transformation through innovation

Innovation is central to economic growth – long-term gains in productivity and new product development are determined by trends in innovation. Innovation also makes it possible to continue growing our economies in a world of finite resources. The importance of innovation is a recurring theme throughout this report; it is essential to transforming global energy systems, agriculture and cities. It also depends on and is shaped by factors discussed in the report, from investment strategies, to effective regulation of markets, to climate policy.

The Organisation for Economic Co-operation and Development (OECD) has projected that if current trends continue, as the global population grows from 7 billion in 2010 to more than 9 billion in 2050, per capita consumption will more than triple, from about US$6,600 to US$19,700 per year, and global GDP will nearly quadruple, requiring 80% more energy. 185 Sustaining growth at that scale will only be possible with radically new business models, products and means of production.

Chapter eight | International Cooperation

A better climate through cooperation

Globalisation has been a major driver of both low- and high-carbon growth over the last 25 years. International trade and investment have enabled a huge expansion of global production, raising greenhouse gas emissions, but they have also helped advance the low-carbon economy. The increasingly global integration of supply chains for products such as solar and wind power components, for example, has helped dramatically reduce their costs. 204

The low-carbon economy is now a global phenomenon. International trade in environmental goods and services totals nearly US$1 trillion per year, or around 5% of all trade. 205 Trade in low-carbon and energy-efficient technologies alone is expected to reach US$2.2 trillion by 2020, a tripling of current levels. 206 Two-fifths of that market is expected to be in emerging and developing economies, 207 and the suppliers come from all over the world. In just the solar power sector, China and the US trade around US$6.5 billion worth of goods each year. 208

Chapter nine | Country Cases

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  1. Estimates based on population and poverty data (defined as living under US$2 per day, adjusted for purchasing power parity) for low- and middle-income countries in: The World Bank, 2014. World Development Indicators 2014LINK

    The number of people living under US$2 in low- and middle-income countries in 1999 was 2.9 billion. From 1990 to 1999, the absolute number of people in poverty increased by 87 million. See also: World Bank, 2014. Poverty Overview. LINK [Last updated 7 April 2014.]

  2. 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.

  3. Low-income countries’ growth, while substantial, has lagged that of middle-income countries. In 1990–2012, low-income countries’ GDP grew by 156%, while middle-income countries’ grew by 215%. Low-income countries’ share of the global economy only grew from 1.1% to 1.4% in 1990–2012, while middle-income countries’ share rose from 26.8% to 41.9%. See: The World Bank, 2014, World Development Indicators 2014. Data cited are for GDP (constant 2005 international $ PPP), available in the 11 April 2014 release of the WDI (but not on the web).

  4. Agénor, P. R., Canuto, O. and Jelenic, M., 2012. Avoiding Middle-Income Growth Traps. Economic Premise, No. 98. The World Bank, Washington, DC. LINK

  5. World Health Organization (WHO), 2014. Burden of Disease from Ambient Air Pollution for 2012. Geneva. LINK

  6. International Monetary Fund (IMF), 2014. World Economic Outlook 2014: Recovery Strengthens, Remains Uneven. Washington, DC. LINK

  7. 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. LINK

  8. IPCC, 2013. Summary for Policymakers. In Climate Change 2013: The Physical Science Basis. Contribution of Working Group I to the Fifth Assessment Report of the Intergovernmental Panel on Climate Change. T.F. Stocker, D. Qin, G.-K. Plattner, M.M.B. Tignor, S.K. Allen, et al. (eds.). Cambridge University Press, Cambridge, UK, and New York. LINK

    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. LINK

  9. The IPCC estimates that the global average temperature will likely be 0.3–0.7°C higher in 2016–2035 relative to 1986–2005. See: IPCC, 2013. Summary for Policymakers (IPCC AR5, Working Group I).

  10. IPCC, 2014. Summary for Policymakers. In Climate Change 2014: Impacts, Adaptation, and Vulnerability. Part A: Global and Sectoral Aspects. Contribution of Working Group II to the Fifth Assessment Report of the Intergovernmental Panel on Climate Change. C.B. Field, V.R. Barros, D.J. Dokken, K.J. Mach, M.D. Mastandrea, et al. (eds.). Cambridge University Press, Cambridge, UK, and New York. LINK

  11. IPCC, 2014. Summary for Policymakers (IPCC AR5, Working Group II).

  12. See: Melillo, J. M., Richmond, T. C. and Yohe, G. W., eds., 2014. Climate Change Impacts in the United States: The Third National Climate Assessment. US Global Change Research Program. LINK

    Also: Gordon, K., 2014. Risky Business: The Economic Risks of Climate Change in the United States. The Risky Business Project. LINK

  13. Of four representative concentration pathways analysed by the IPCC, only RCP 2.6, which requires global emissions to peak no later than 2020 and become net negative by 2090, is associated with a 66% or better chance of keeping warming below 2°C. See IPCC, 2013, Summary for Policymakers (IPCC AR5, Working Group I), and: van Vuuren, D.P., Edmonds, J., Kainuma, M., Riahi, K., Thomson, A., et al., 2011. The representative concentration pathways: an overview. Climatic Change, 109(1-2). 5–31. DOI:10.1007/s10584-011-0148-z. (See Figure 6.)

  14. IPCC, 2014. Summary for Policymakers (IPCC AR5, Working Group III).

  15. Applying the GDP growth projections of the Organisation for Economic Co-operation and Development (OECD) – 3.4% to 2018 and 3.3% for the remaining years – results in 69% cumulative growth. See: OECD, 2012. Medium and Long-Term Scenarios for Global Growth and Imbalances. OECD Economic Outlook, Volume 2012, Issue 1. Paris. LINK

    A lower 2.5% annual growth rate would result in the economy being 48% bigger in 2030 than in 2014.

  16. Climate Policy Initiative analysis for the New Climate Economy project, based on data from:

    International Energy Agency (IEA), 2012. Energy Technology Perspectives: How to Secure a Clean Energy Future. Paris. LINK

    Organisation for Economic Co-operation and Development (OECD), 2012. Strategic Transport Infrastructure Needs to 2030. Paris. LINK

    Organisation for Economic Co-operation and Development (OECD), 2006. Infrastructure to 2030. Paris. LINK

  17. See, e.g.: The World Bank, 2012. Inclusive Green Growth: The Pathway to Sustainable Development. Washington, DC. LINK

    United Nations Environment Programme (UNEP), 2011. Towards a Green Economy: Pathways to Sustainable Development and Poverty Eradication. Nairobi, Kenya. LINK

    Also see extensive work on green growth by the Organisation for Economic Co-operation and Development (OECD): LINK and by the World Economic Forum: LINK

    The Green Growth Knowledge Platform, established jointly in January 2012 by the Global Green Growth Institute, the OECD, UNEP and the World Bank, lists a rich and diverse collection: LINK

    The Nordic Council of Ministers has an extensive green growth library as well, and a magazine, Green Growth the Nordic Way; all are available at: LINK

  18. The estimate is for low-carbon electricity in particular. See: Climate Policy Initiative (CPI), 2014. Roadmap to a Low Carbon Electricity System in the U.S. and Europe. San Francisco, CA, US. LINK

  19. See: McCrone, A., Usher, E., Sonntag-O’Brien, V., Moslener, U. and Grüning, C., eds., 2014. Global Trends in Renewable Energy Investment 2014. Frankfurt School-UNEP Collaborating Centre for Climate & Sustainable Energy Finance, United Nations Environment Programme, and Bloomberg New Energy Finance. LINK

  20. United Nations (UN), 2014. World Urbanization Prospects, the 2014 revision. UN Department of Economic and Social Affairs, Population Division. LINKThe urban population in 2014 is estimated at 3.9 billion; in 2030 it is projected to be 5.1 billion. For detailed data, see: LINK

  21. Seto, K.C. and Dhakal, S., 2014. Chapter 12: Human Settlements, Infrastructure, and Spatial Planning. 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. LINK

  22. The Intergovernmental Panel on Climate Change (IPCC) estimates that in 2010, urban areas accounted for 67–76% of global energy use and 71–76% of global CO2 emissions from final energy use. See: Seto andDhakal, 2014. Chapter 12: Human Settlements, Infrastructure, and Spatial Planning.

  23. 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. LINKThe IPCC reports net total anthropogenic GHG emissions from agriculture, forestry and other land use (AFOLU) in 2010 as 10–12 Gt CO2e, or 24% of all GHG emissions in 2010. The AFOLU chapter further specifies that GHG emissions from agriculture in 2000–2009 were 5.0–5.8 Gt CO2e per year. See: Smith, P. and Bustamante, M., 2014. Chapter 11: Agriculture, Forestry and Other Land Use (AFOLU). 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. LINK

  24. Total calories produced must increase by 70% from 2006 levels, per: Searchinger, T., Hanson, C., Ranganathan, J., Lipinski, B., Waite, R., Winterbottom, R., Dinshaw, A. and Heimlich, R., 2013. Creating a Sustainable Food Future: A Menu of Solutions to Sustainably Feed More than 9 Billion People by 2050. World Resources Report 2013-14: Interim Findings. World Resources Institute, the World Bank, United Nations Environment Programme (UNEP), United Nations Development Programme (UNDP), Washington, DC. LINK

  25. A further 8% of agricultural land is moderately degraded, and the amount is increasing. See: Food and Agriculture Organization of the United Nations (FAO), 2011. The State of the World’s Land and Water Resources for Food and Agriculture (SOLAW) – Managing Systems at Risk. Rome. LINKSee also work by partners of the Economics of Land Degradation: A Global Initiative for Sustainable Land Management, launched in 2013: LINK

  26. This figure is the gross amount of forest converted. When adding in reported reforestation and afforestation, the net figure is 5.2 million ha. See: Food and Agriculture Organization of the United Nations (FAO), 2010. Global Forest Resources Assessment 2010. Rome. LINK

  27. For energy-related emissions outside direct industry emissions, see all sectors except AFOLU and waste in Figure TS.3a in: IPCC, 2014. Technical Summary. 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. LINKFor direct energy-related emissions in industry, see Table 10.2 of Fischedick, M. and Roy, J., 2014. Chapter 10: Industry. 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. LINK

  28. This range is based on a New Climate Economy staff review of recent projections, including:19% in the New Policies Scenario and 25% in the Current Policiesscenario in: International Energy Agency (IEA), 2013. World Energy Outlook 2013. Paris. LINK26% in the 6DS scenario in: IEA, 2012. Energy Technology Perspectives 2012: Pathways to a Clean Energy System. Paris. LINK27% estimate in: US Energy Information Administration (EIA), 2013. International Energy Outlook. DOE/EIA-0484(2013). Washington, DC. LINK29–33% range provided in baselines developed for: GEA, 2012. Global Energy Assessment – Toward a Sustainable Future, 2012. Cambridge University Press, Cambridge, UK, and New York, and International Institute for Applied Systems Analysis, Laxenburg, Austria. LINK

  29. The World Bank, n.d. Global Economic Monitor (GEM) Commodities.

  30. International Energy Agency (IEA), 2011. Energy for All: Financing Access for the Poor. Special early excerpt of the World Energy Outlook 2011. First presented at the Energy For All Conference in Oslo, Norway, October 2011. LINK

  31. See, e.g.: European Climate Foundation (ECF), 2014. Europe’s Low-carbon Transition: Understanding the Challenges and Opportunities for the Chemical Sector. Brussels. LINK

  32.  Dechezleprêtre, A., Martin, R. and Mohnen, M., 2013. Knowledge Spillovers from Clean and Dirty Technologies: A Patent Citation Analysis. Centre for Climate Change Economics and Policy Working Paper No. 151 and Grantham Research Institute on Climate Change and the Environment Working Paper No. 135. London. LINK

  33. PricewaterhouseCoopers (PwC), 2013. Decarbonisation and the Economy: An empirical analysis of the economic impact of energy and climate change policies in Denmark, Sweden, Germany, UK and The Netherlands. LINK

  34. See: Brahmbhatt, M., Dawkins, E., Liu, J. and Usmani, F., 2014 (forthcoming). Decoupling Carbon Emissions from Economic Growth: A Review of International Trends. New Climate Economy contributing paper. World Resources Institute, Stockholm Environment Institute and World Bank. LINK

    Also: Brinkley, C., 2014. Decoupled: successful planning policies in countries that have reduced per capita greenhouse gas emissions with continued economic growth. Environment and Planning C: Government and Policy, advance online publication. DOI:10.1068/c12202.

  35. Climate Policy Initiative analysis for the New Climate Economy project, based on data from: IEA, 2012, Energy Technology Perspectives; OECD, 2012, Strategic Transport Infrastructure Needs to 2030; and OECD, 2006, Infrastructure to 2030. Low-carbon infrastructure includes some investment in carbon capture and storage (CCS), as projected by the IEA.

  36. See Figure 11 in Part II, Section 5.2 of this Synthesis Report for more details.

  37. International Energy Agency (IEA), 2012. Energy Technology Perspectives: How to Secure a Clean Energy Future. Paris. LINK

    Organisation for Economic Co-operation and Development (OECD), 2012. Strategic Transport Infrastructure Needs to 2030. Paris. LINK

    Organisation for Economic Co-operation and Development (OECD), 2006. Infrastructure to 2030. Paris. LINK

  38. For a discussion, see: Stiglitz, J.E., Sen, A. and Fitoussi, J-P., Report by the Commission on the Measurement of Economic Performance and Social Progress. LINK

  39. Eliasch, J., 2008. Climate Change: Financing Global Forests – the Eliasch Review. Her Majesty’s Government, London. LINK

  40. IEA, 2011. Energy for All: Financing Access for the Poor.

  41. See: Hamilton, K., Brahmbhatt, M., Bianco, N., and Liu, J.M., 2014. Co-benefits and Climate Action. New Climate Economy contributing paper. World Resources Institute, Washington, DC. LINK

  42. Hamilton, K., Brahmbhatt, M., Bianco, N. and Liu, J.M., 2014 (forthcoming). Co-benefits and Climate Action. New Climate Economy contributing paper. World Resources Institute, Washington, DC. LINK

    Particulate matter (PM), a mix of tiny solid and liquid particles suspended in the air, affects more people than any other air pollutant. The most health-damaging particles have a diameter of 10 microns or less, which can penetrate the lungs; these are referred to as PM10. In many cities, the concentration of particles under 2.5 microns is also measured; this is PM2.5. See: World Health Organization (WHO), 2014. Ambient (outdoor) air quality and health. Fact Sheet No. 313. Geneva. LINK For global PM2.5 mortality estimates, see: WHO, 2014. Burden of Disease from Ambient Air Pollution for 2012.

  43. Teng, F., 2014 (forthcoming). China and the New Climate Economy. New Climate Economy contributing paper. Tsinghua University. LINK

  44. See Klevnäs, P. and Korsbakken, J. I., 2014. A Changing Outlook for Coal Power. New Climate Economy contributing paper. Stockholm Environment Institute, Stockholm. LINK

  45. See Chapter 2: Cities for an in-depth discussion.

  46. See, e.g., Gwilliam, K. M., 2002. Cities on the Move: A World Bank Urban Transport Strategy Review. The World Bank, Washington, DC. LINK

    For a more recent discussion, focused on Africa, see: Schwela, D. and Haq, G., 2013. Transport and Environment in Sub-Saharan Africa. SEI policy brief. Stockholm Environment Institute, York, UK. LINK

  47. For an in-depth discussion of these issues, see: Denton, F. and Wilbanks, T., 2014. Chapter 20: Climate-Resilient Pathways: Adaptation, Mitigation, and Sustainable Development. In Climate Change 2014: Impacts, Adaptation, and Vulnerability. Part A: Global and Sectoral Aspects. Contribution of Working Group II to the Fifth Assessment Report of the Intergovernmental Panel on Climate Change. C.B. Field, V.R. Barros, D.J. Dokken, K.J. Mach, M.D. Mastandrea, et al. (eds.). Cambridge University Press, Cambridge, UK, and New York. LINK

    For practical guidance on “climate-proofing” and ways to identify adaptation needs, evaluate options, and plan and implement adaptation, see: PROVIA, 2013. PROVIA Guidance on Assessing Vulnerability, Impacts and Adaptation to Climate Change. Consultation document. United Nations Environment Programme, Nairobi, Kenya. LINK

  48. Chapter 3: Land Use of the main report discusses climate-smart agriculture in greater detail.

  49. Oxford Economics, 2014 (forthcoming).The Economic Impact of Taxing Carbon. New Climate Economy contributing paper. Oxford, UK. LINK

  50. IPCC, 2014. Summary for Policymakers (IPCC AR5, Working Group III). See Table SPM.2.

  51. See endnote 15 for GDP growth projections to 2030.

  52. See: Bosetti V., Carraro, C., Galeotti, M., Massetti, E. and Tavoni, M., 2006. WITCH: A World Induced Technical Change Hybrid Model. The Energy Journal, 27. 13–37. LINK

    Gillingham, K., Newell, R. G. and Pizer, W. A., 2008. Modeling endogenous technological change for climate policy analysis. Energy Economics, 30 (6). 2734–2753. DOI: 10.1016/j.eneco.2008.03.001.

    Dellink, R., Lanzi, E., Chateau, J., Bosello, F., Parrado, R. and de Bruin, K., 2014. Consequences of Climate Change Damages for Economic Growth: A Dynamic Quantitative Assessment. Organisation for Economic Co-operation and Development, Economics Department Working Papers No. 1135. OECD Publishing, Paris. LINK

  53. Chateau, J., Saint-Martin A. and Manfredi, T., 2011. Employment Impacts of Climate Change Mitigation Policies in OECD: A General-Equilibrium Perspective. Organisation for Economic Co-operation and Development, Environment Working Papers No. 32. OECD Publishing, Paris. LINK

  54. Chateau et al., 2011. Employment Impacts of Climate Change Mitigation Policies in OECD.

  55. ECF, 2014. Europe’s Low-carbon Transition: Understanding the Challenges and Opportunities for the Chemical Sector.

  56. Ferroukhi, R., Lucas, H., Renner, M., Lehr, U., Breitschopf, B., Lallement, D., and Petrick, K., 2013. Renewable Energy and Jobs. International Renewable Energy Agency, Abu Dhabi. LINK

  57. The World Coal Association estimates that 7 million people are directly employed by the industry. LINK [Accessed 30 August 2014.]

  58. Organisation for Economic Co-operation and Development (OECD), 2012 The Jobs Potential of a Shift towards a Low-carbon Economy, Paris. LINK

  59. This and the next two paragraphs draw on insights presented in a special issue of the International Labour Organization’s International Journal of Labour Research (Vol. 2, Issue 2, 2010): Climate Change and Labour: The Need for a “Just Transition”. LINK

  60. For lessons from trade liberalisation adjustment experience, see: Porto, G., 2012. The Cost of Adjustment to Green Growth Policies: Lessons from Trade Adjustment Costs. Research Working Paper No. WPS 6237. The World Bank, Washington, DC. LINK

  61. The Global Subsidies Initiative, established by the International Institute for Sustainable Development, has produced several case studies of fossil fuel subsidy reforms. LINK

    For case studies of Indonesia and Ghana in particular, see:

    Beaton, C. and Lontoh, L., 2010. Lessons Learned from Indonesia’s Attempts to Reform Fossil-Fuel Subsidies. Prepared for the Global Subsidies Initiative (GSI) of the International Institute for Sustainable Development. Geneva. LINK

    Laan, T., Beaton, C. and Presta, B., 2010. Strategies for Reforming Fossil-Fuel Subsidies: Practical Lessons from Ghana, France and Senegal. Prepared for the Global Subsidies Initiative (GSI) of the International Institute for Sustainable Development. Geneva. LINK

    For more detailed discussions on conditional cash-transfer programmes, see: Vagliasindi, M., 2012. Implementing Energy Subsidy Reforms: An Overview of the Key Issues. Policy Research Working Paper No. WPS 6122. The World Bank, Washington, DC. LINK

  62. Organisation for Economic Cooperation and Development (OECD), 2013. Pricing Carbon: Policy Perspectives. Paris. LINK

  63. In policy discussions, a 2°C average global temperature increase is often treated as the threshold between “safe” and “dangerous” levels of warming. The concept of “dangerous” climate change comes from the overarching objective of the United Nations Framework Convention on Climate Change (UNFCCC), namely “stabilization of greenhouse gas concentrations in the atmosphere at a level that would prevent dangerous anthropogenic interference with the climate system”. The goal of holding the increase in global average temperature below 2°C above pre-industrial levels was agreed at the UNFCCC Conference in Cancun in 2010. (LINK and LINK)

    But the IPCC has made it clear that climate change impacts will vary by location, and substantial damages may occur well before 2°C is reached. See: IPCC, 2013, Summary for Policymakers (IPCC AR5, Working Group I), and IPCC, 2014, Summary for Policymakers (IPCC AR5, Working Group II).

    There is also a growing scientific and policy literature on the risks associated with a global temperature rise of 4°C or more. See, for example, the Philosophical Transactions of the Royal Society A special issue published in 2011: Four Degrees and Beyond: the Potential for a Global Temperature Change of Four Degrees and its Implications. LINK

    Also see: The World Bank, 2012. Turn Down the Heat: Why a 4°C Warmer World Must Be Avoided. Report for the World Bank by the Potsdam Institute for Climate Impact Research and Climate Analytics, Washington, DC. LINK

  64. This estimate and emission reduction needs to 2030 are based on analysis of the IPCC’s review of emission scenarios, as shown in Figure SPM.4 and Table SPM.1 in IPCC, 2014. Summary for Policymakers (IPCC AR5, Working Group III). The GHG emission levels given here correspond to the median values for two emission pathways. One is consistent with baseline scenarios associated with a <33% probability that warming by 2100 relative to 1850-1900 will be less than 3°C, and a <50% probability that it will exceed 4°C. The other is consistent with mitigation scenarios associated with a >66% probability of keeping warming under 2°C. For a detailed discussion, see the New Climate Economy Technical Note, Quantifying Emission Reduction PotentialLINK

  65. This and the estimate that follows are based on New Climate Economy staff analysis, using data from the World Bank, World Development Indicators 2014, and calculations for 2015-50 using illustrative GDP growth assumptions of 3% per year in 2015–30 and 2.5% a year in 2030–50. For further discussion, see: Brahmbhatt et al., 2014 (forthcoming). Decoupling Carbon Emissions from Economic Growth: A Review of International Trends.

  66. All of this needs to be understood in the context that the IPCC assumes high levels of aerosols – small particles and liquid droplets – in the atmosphere that can prevent solar energy from reaching the Earth’s surface, allowing for higher levels of emissions until 2030. If those aerosols were reduced (e.g. due to tighter pollution controls), staying on a 2°C path after 2030 would require negative emissions in the second half of the century. This poses substantial technical challenges that remain unresolved.

    See: Clarke, L. and Jiang, K., 2014. Chapter 6: Assessing Transformation Pathways. 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. LINK

  67. For a detailed outline of the data sources and methodology, see the New Climate Economy Technical Note, Quantifying Emission Reduction PotentialLINK

  68. See Clarke and Jiang, 2014. Chapter 6: Assessing Transformation Pathways.

  69. See IPCC, 2014. Summary for Policymakers (IPCC AR5, Working Group III).

  70. See the New Climate Economy Technical Note, Quantifying the Multiple Benefits from Low Carbon Actions. LINK

  71. McKinsey & Company, 2014 (forthcoming). Global GHG Abatement Cost Curve v3.0. Version 2.1 is available at: LINK

  72.  For a detailed outline of the data sources and methodology, see the New Climate Economy Technical Note, Quantifying the Multiple Benefits from Low-Carbon Actions: A Preliminary AnalysisLINK

  73. A number of market indices have been launched, such as the Resource Efficiency Leaders Index LINK, which show systematic outperformance against the stock market as a whole through over-weighting those companies which are resource efficiency leaders in their sectors (greater than 70% since 2008 in the case of RESSEFLI).

  74. World Business Council on Sustainable Development, 2013. Reporting Matters 2013 Baseline Report. LINK

  75. “Net emissions” takes into account the possibility of storing and sequestering some emissions. See:

    Haites, E., Yamin, F. and Höhne, N., 2013. Possible Elements of a 2015 Legal Agreement on Climate Change, Working Paper N°16/13, Institute for Sustainable Development and International Relations (IDDRI), Paris. LINK

    Höhne, N.. van Breevoort, P., Deng, Y., Larkin, J. and Hänsel, G., 2013. Feasibility of GHG emissions phase-out by mid-century. Ecofys, Cologne, Germany. LINK

  76. Seto, K.C. and Dhakal, S., 2014. Chapter 12: Human Settlements, Infrastructure, and Spatial Planning. 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. LINK

  77. The Intergovernmental Panel on Climate Change (IPCC) estimates that in 2010, urban areas accounted for 67–76% of global energy use and 71–76% of global CO2 emissions from final energy use. See: Seto andDhakal, 2014. Chapter 12: Human Settlements, Infrastructure, and Spatial Planning.

  78. Seto and Dhakal, 2014. Chapter 12: Human Settlements, Infrastructure, and Spatial Planning.

  79. United Nations (UN), 2014. World Urbanization Prospects, the 2014 revision. UN Department of Economic and Social Affairs, Population Division. LINK

    For detailed data, see: LINK

  80. Seto, K.C., Güneralp, B. and Hutyra, L.R., 2012. Global forecasts of urban expansion to 2030 and direct impacts on biodiversity and carbon pools. Proceedings of the National Academy of Sciences, 109(40). 16083–16088. DOI:10.1073/pnas.1211658109.

  81. Dargay, J., Gatley D., and Sommer M., 2007. Vehicle ownership and income growth, worldwide: 1960-2030. The Energy Journal, 28(4). 143–170. LINK

  82. Litman, T., 2014 (forthcoming). Analysis of Public Policies that Unintentionally Encourage and Subsidize Urban Sprawl. New Climate Economy contributing paper. Victoria Transport Policy Institute, commissioned by the London School of Economics and Political Science. LINK

  83. Litman, 2014 (forthcoming). Analysis of Public Policies that Unintentionally Encourage and Subsidize Urban Sprawl.

  84. The World Bank and Development Research Center of the State Council, 2014. Urban China: Toward Efficient, Inclusive, and Sustainable Urbanization. Washington, DC. LINK

  85. Fan, J., 2006. Industrial Agglomeration and Difference of Regional Labor Productivity: Chinese Evidence with International Comparison. Economic Research Journal, 11. 73–84. LINK

  86. Gouldson, A., Colenbrander, S., McAnulla, F., Sudmant, A., Kerr, N., Sakai, P., Hall, S. and Kuylenstierna, J.C.I., 2014 (forthcoming). Exploring the Economic Case for Low-Carbon Cities. New Climate Economy contributing paper. Sustainability Research Institute, University of Leeds, and Stockholm Environment Institute, York, UK. LINK

  87. These are New Climate Economy (NCE) estimates based on analysis of global infrastructure requirements by the International Energy Agency (IEA, 2012. Energy Technology Perspectives 2012) and the Organisation for Economic Co-operation and Development (OECD, 2007. Infrastructure to 2030) for road investment, water and waste, telecommunications, and buildings (energy efficiency), and conservative assumptions about the share of urban infrastructure and the infrastructure investment costs (based on multiple sources) of sprawling versus smarter urban development. This should be treated as an indicative order of magnitude global estimate. This estimate is corroborated by evidence from Litman, 2014 (forthcoming), Analysis of Public Policies that Unintentionally Encourage and Subsidize Urban Sprawl, which looks at the infrastructure and public service costs of urban sprawl in the United States.

  88. Arrington, G.B. and Cervero, R., 2008. Effects of TOD on Housing, Parking, and Travel. Transit Cooperative Research Programme Report No. 128. LINK

  89. See: Laconte, P., 2005. Urban and Transport Management – International Trends and Practices. Paper presented at the Joint International Symposium: Sustainable Urban Transport and City. Shanghai. LINK

    For more on Houston’s efforts, see Box 7 in the Chapter 2: Cities in our main report.

  90. Carrigan, A., King, R., Velásquez, J.M., Duduta, N., and Raifman, M., 2013. Social, Environmental and Economic Impacts of Bus Rapid Transit. EMBARQ, a programme of the World Resources Institute, Washington, DC. LINK

  91. See: LINK

  92. The World Bank and Development Research Center of the State Council, 2014. Urban China.

  93. Current data from: DeMaio, P., 2013. The Bike-sharing World – End of 2013. The Bike-sharing Blog, 31 December. LINK (The data cited by DeMaio come from The Bike-sharing World Map LINK a Google map of known bike-sharing schemes.)

    Data for 2000 from: Midgley, P., 2011. Bicycle-Sharing Schemes: Enhancing Sustainable Mobility in Urban Areas. United Nations Department of Economic and Social Affairs, Commission on Sustainable Development. Background Paper No. 8, CSD19/2011/BP8. LINK

  94. Floater, G., Rode, P., Zenghelis, D., Carrero, M.M., Smith, D., Baker K., and Heeckt, C., 2013. Stockholm: Green Economy Leader Report. LSE Cities, London School of Economics and Political Science, London. LINK

  95. United Nations Environment Programme (UNEP), 2009. Sustainable Urban Planning in Brazil. Nairobi. LINK

    See also: Barth, B., 2014. Curitiba: the Greenest City on Earth. The Ecologist. 15 March. LINK

  96. Xinhua, 2014. China unveils Landmark Urbanization Plan16 March. LINK

  97. The World Bank, 2013. Planning and Financing Low-Carbon, Livable Cities. Washington DC. LINK

  98. The World Bank, 2013. Planning and Financing Low-Carbon, Livable Cities.

  99. A further 8% of agricultural land is moderately degraded, and the amount is increasing. See: Food and Agriculture Organization of the United Nations (FAO), 2011. The State of the Worlds Land and Water Resources for Food and Agriculture (SOLAW) Managing Systems at Risk. Rome. LINK

    See also work by partners of the Economics of Land Degradation: A Global Initiative for Sustainable Land Management, launched in 2013: LINK

  100. Kissinger, G., Herold, M. and de Sy, V., 2012. Drivers of Deforestation and Forest Degradation: A Synthesis Report for REDD+ Policymakers. Lexeme Consulting, Vancouver. LINK

  101. 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. LINK

    The IPCC reports net total anthropogenic GHG emissions from agriculture, forestry and other land use (AFOLU) in 2010 as 10–12 Gt CO2e, or 24% of all GHG emissions in 2010. The AFOLU chapter further specifies that GHG emissions from agriculture in 2000–2009 were 5.0–5.8 Gt CO2e per year. See: Smith, P. and Bustamante, M., 2014. Chapter 11: Agriculture, Forestry and Other Land Use (AFOLU). 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. LINK

  102. The 11% global emissions from the FOLU component of AFOLU is from Searchinger, T., Hanson, C., Ranganathan, J., Lipinski, B., Waite, R., Winterbottom, R., Dinshaw, A. and Heimlich, R., 2013. Creating a Sustainable Food Future: A Menu of Solutions to Sustainably Feed More than 9 Billion People by 2050. World Resources Report 2013-14: Interim Findings. World Resources Institute, the World Bank, United Nations Environment Programme (UNEP), United Nations Development Programme (UNDP), Washington, DC. LINK

    Searchinger et al. then attribute a further 13% of global GHG emissions to agriculture directly. The estimate of roughly 20% of global emissions from gross deforestation is derived from adding estimates from carbon savings from reforestation and afforestation to estimates of emissions from net deforestation in Houghton, R. A., 2013. The emissions of carbon from deforestation and degradation in the tropics: past trends and future potential.

  103. Food and Agriculture Organization of the United Nations (FAO), 2010. Global Forest Resources Assessment 2010. FAO Forestry Paper 163. Rome. LINK

    Also see: Food and Agriculture Organization of the United Nations and European Commission Joint Research Centre, 2012. Global Forest Land-Use Change 1990–2005. By E.J. Lindquist, R. D’Annunzio, A. Gerrand, K., MacDicken, F., Achard, R., Beuchle, A., Brink, H.D., Eva, P., Mayaux, J., San-Miguel-Ayanz and H-J. Stibig. FAO Forestry Paper 169. Rome. LINK

  104. Food and Agriculture Organization of the United Nations (FAO), 2012. Global Forest Land-use Change 19902005. Rome. LINK

    Houghton, R.A., 2008. Improved estimates of net carbon emissions from land cover change in the tropics for the 1990s. In TRENDS: A Compendium of Data on Global Change. Carbon Dioxide Information Analysis Center, Oak Ridge National Laboratory, U.S. Department of Energy, Oak Ridge, TN, US. LINK

    International Energy Agency (IEA), 2012. World Energy Outlook 2012. Paris. LINK

    United Nations Environment Programme (UNEP), 2012. The Emissions Gap Report 2012. Nairobi, Kenya. LINK

    US Energy Information Administration (EIA), 2012. Annual Energy Outlook 2012 with Projections to 2035. Washington, DC. LINK

  105.  The World Bank, 2007. World Development Report 2008: Agriculture for Development. Washington, DC. LINK

  106. World Bank data. LINK [Accessed 16 July 2014.]

  107. Organisation for Economic Co-operation and Development (OECD) and Food and Agriculture Organization of the United Nations (FAO), 2013. OECD-FAO Agricultural Outlook 2014-2023. Paris and Rome. LINK

  108. Searchinger et al., 2013. Creating a Sustainable Food Future.

  109. See: The new green revolution: A bigger rice bowl. The Economist, 10 May 2014. LINK

    Rice in particular is a crop that farmers can replant from their own harvests without yield loss, so it is hard to recover the cost of private breeding.

  110.  Beintema, N., Stads, G.-J., Fuglie, K., and Heisey, P., 2012. ASTI Global Assessment of Agricultural R&D Spending. International Food Policy Research Institute, Washington, DC, and Global Forum on Agricultural Research, Rome. LINK

  111. Gale, F., 2013. Growth and Evolution in China’s Agricultural Support Policies. Economic Research Service Report No. 153. US Department of Agriculture. LINK

  112. Grossman, N., and Carlson, D., 2011. Agriculture Policy in India: The Role of Input Subsidies. USITC Executive Briefings on Trade.

  113. Organisation for Economic Co-operation and Development (OECD), 2013. Agricultural Policy Monitoring and Evaluation 2013. Paris. LINK

  114. Zhang, W., Dou, Z., He, P., Ju, X.-T., Powlson, D., et al., 2013. New technologies reduce greenhouse gas emissions from nitrogenous fertilizer in China. Proceedings of the National Academy of Sciences, 110(21). 8375–8380. DOI:10.1073/pnas.1210447110.

  115. Hoda. A., 2014. Low Carbon Strategies for India in Agriculture and Forestry. Unpublished paper presented at The Indian Council for Research on International Economic Relations (ICRIER) Workshop on the New Climate Economy, ICRIER, India Habitat Center, New Delhi, 15 April.

  116. Based on work by partners of the Economics of Land Degradation: A Global Initiative for Sustainable Land Management launched in 2013 and based at the German Ministry for Economic Cooperation and Development. LINK [Accessed 29 April 2014.]

    Scientific coordination of the ELD initiative is provided by the United Nations University – Institute for Water, Environment and Health (UNU-INWEH). UNEP, IUCN, and The International Food Policy Research Institute are key technical partners.

  117. Berry, L., Olson, J., and Campbell, D., 2003. Assessing the extent, cost and impact of land degradation at the national level: findings and lessons learned from seven pilot case studies. Global Mechanism. LINK

  118. Dang, Y., Ren, W., Tao, B., Chen, G., Lu, C., et al., 2014. Climate and Land Use Controls on Soil Organic Carbon in the Loess Plateau Region of China. PLoS ONE, 9(5). e95548. DOI:10.1371/journal.pone.0095548.

  119.  Cooper, P.J.M., Cappiello, S., Vermeulen, S.J., Campbell, B.M., Zougmoré, R. and Kinyangi, J., 2013. Large-Scale Implementation of Adaptation and Mitigation Actions in Agriculture. CCAFS Working Paper No. 50. CGIAR Research Program on Climate Change, Agriculture and Food Security, Copenhagen. LINK

  120. Photos Till Niermann, GNU free documentation License v1.2 (1990) and Erick Fernandes (2012).

  121. World Resources Institute, 2008. World Resources 2008: Roots of Resilience – Growing the Wealth of the Poor. Produced by WRI in collaboration with United Nations Development Programme, United Nations Environment Programme, and the World Bank, Washington, DC. LINK

  122. Sendzimir, J., Reij, C. P. and Magnuszewski, P., 2011. Rebuilding Resilience in the Sahel: Regreening in the Maradi and Zinder Regions of Niger. Ecology and Society, 16(3), Art. 1. DOI:10.5751/ES-04198-160301.

    And: Pye-Smith, C., 2013. The Quiet Revolution: how Niger’s farmers are re-greening the parklands of the Sahel. ICRAF Trees for Change, No. 12. World Agroforestry Center, Nairobi. LINK

  123.  Winterbottom, R., Reij, C., Garrity, D., Glover, J., Hellums, D., McGahuey, M. and Scherr, S., 2013. Improving Land and Water Management. Creating a Sustainable Food Future, Installment Four. World Resources Institute, Washington, DC. LINK

  124. Food and Agriculture Organization of the United Nations (FAO), 2014. State of the Worlds Forests 2014: Enhancing the Socioeconomic Benefits from Forests. Rome. LINK

    See also: IEA, 2012. World Energy Outlook 2012.

  125. WWF, 2012. Chapter 4: Forests and Wood Products, In WWF Living Forest Report. Washington, DC. LINK

  126. Rautner, M., Leggett, M., and Davis, F., 2013. The Little Book of Big Deforestation Drivers. Global Canopy Programme, Oxford. LINK

  127. Kissinger et al., 2012. Drivers of Deforestation and Forest Degradation.

  128. See, e.g.: Leonard, S., 2014. Forests, Land Use and The Green Climate Fund: Open for Business? Forests Climate Change, 5 June. LINK

  129. Minnemeyer, S., Laestadius, L., Sizer, N., Saint-Laurent, C., and Potapov, P., 2011. Global Map of Forest Landscape Restoration Opportunities. Forest and Landscape Restoration project, World Resources Institute, Washington, DC. LINK

    They estimate that there are 2.314 billion ha of lost and degraded forest landscapes around the world (relative to land that could support forests in the absence of human interference; precise data and interpretation confirmed by map author Lars Laestadius, 14 August 2014).

    The Aichi Target #15 states: “By 2020, ecosystem resilience and the contribution of biodiversity to carbon stocks has been enhanced, through conservation and restoration, including restoration of at least 15 per cent of degraded ecosystems, thereby contributing to climate change mitigation and adaptation and to combating desertification.”15% of 2.314 billion ha is 347 million ha. LINK [Accessed 22 July 2014.]

  130. The estimate is a doubling of the estimate of US$85 billion given for 150 million ha in Verdonne, M., Maginnis, S., and Seidl, A., 2014 (forthcoming). Re-examining the Role of Landscape Restoration in REDD+. International Union for Conservation of Nature. Thus, the estimate is conservative, as it ignores the last 50 million ha of the 350 million ha estimate. Their calculation assumes 34% of the restoration is agroforestry, 23% is planted forests, and 43% is improved secondary and naturally regenerated forests, all distributed across different biomes. Benefits assessed included timber products, non-timber forest products, fuel, better soil and water management remunerated through crop higher yields, and recreation.

  131. This is based on an average from applying per ha estimates of mitigation in the literature, which yields roughly 2 Gt CO2e for 350 million ha, and taking a range of 50% above and below to account for the carbon differences that would ensue from different mixes of agroforestry, mosaic restoration in temperate zones, and natural regeneration of tropical moist forest, for example, within the total area restored. More details are in the forthcoming New Climate Economy Technical Note, Quantifying the Multiple Benefits from Low Carbon Actions: A Preliminary AnalysisLINK

  132. Parry, A., James, K., and LeRoux, S., 2014 (forthcoming). Strategies to Achieve Economic and Environmental Gains by Reducing Food Waste. New Climate Economy contributing paper. Waste & Resources Action Programme (WRAP), Banbury, UK. LINK

  133. Estimates vary between 49% to 2011 or 54% to 2012, depending on methodology and data sources. See BP, 2013. BP Statistical Review of World Energy June 2013. London. LINK

  134. Global primary energy consumption rose by 3,388 million tonnes of oil equivalent (Mtoe) from 2000 to 2013, to 12,730 Mtoe; in that same period, China’s primary energy consumption rose by 1,872 Mtoe, to 2852.4 Mtoe in 2013. See BP, 2014. BP Statistical Review of World Energy June 2014. London. LINK

  135. This range is based on a New Climate Economy staff review of recent projections, including:

    19% in the New Policies Scenario and 25% in the Current Policiesscenario in: International Energy Agency (IEA), 2013. World Energy Outlook 2013. Paris. LINK

    26% in the 6DS scenario in: IEA, 2012. Energy Technology Perspectives 2012.

    27% estimate in: US Energy Information Administration (EIA), 2013. International Energy Outlook. DOE/EIA-0484(2013). Washington, DC. LINK

    29–33% range provided in baselines developed for: GEA, 2012. Global Energy Assessment – Toward a Sustainable Future, 2012. Cambridge University Press, Cambridge, UK, and New York, and International Institute for Applied Systems Analysis, Laxenburg, Austria. LINK

  136. This includes an estimated US$23 trillion in energy supply and US$24 trillion across transport engines and energy use in buildings and industry. See Chapter 6: Finance in our main report for more discussion of future energy infrastructure needs.

  137. For energy-related emissions outside direct industry emissions, see all sectors except AFOLU and waste in Figure TS.3a in: IPCC, 2014. Technical Summary. 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. LINK

    For direct energy-related emissions in industry, see Table 10.2 of Fischedick, M. and Roy, J., 2014. Chapter 10: Industry. 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. LINK

  138. The World Bank, n.d. Global Economic Monitor (GEM) Commodities.

  139. Planning Commission of the Government of India, 2013. India Energy Security Scenarios 2047. LINK

  140. IEA, 2013. World Energy Outlook 2013.

    Planning Commission of the Government of India, 2013. India Energy Security Scenarios 2047.

    EIA, 2013. International Energy Outlook 2013.

    Feng, L.Q., 2012. Analysis on Coal Import Origin of China (in Chinese). Master thesis, Inner Mongolia University. LINK

    Wood Mackenzie, 2013. International thermal coal trade: What Will the Future Look Like for Japanese Buyers? Presentation for the Clean Coal Day 2013 International Symposium, Tokyo, 4-5 September 2013.

  141. Hamilton, K., Brahmbhatt, M., Bianco, N. and Liu, J.M., 2014 (forthcoming). Co-benefits and Climate Action. New Climate Economy contributing paper. World Resources Institute, Washington, DC. LINK

  142. See Klevnäs, P. and Korsbakken, J.I., 2014 (forthcoming). A Changing Outlook for Coal Power. New Climate Economy contributing paper. Stockholm Environment Institute, Stockholm. LINK

  143. IEA, 2013. World Energy Outlook 2013.

  144. 11 Gt CO2 corresponds to the total reductions in the 450 scenario relative to the Current Policies scenario. See IEA, 2013, World Energy Outlook 2013.

  145. The estimated range is likely cost-effective reductions of 4.7-6.6 GtCO2 per year. For further discussion of the scope and limitations of these estimates, see the New Climate Economy technical note, Quantifying Emission Reduction Potential. LINK

  146. This section focuses on electricity, but options to use renewable energy also exist across heating, industry, and transport systems. A recent assessment by the International Renewable Energy Agency (IRENA) also identifies significant opportunities for cost-effective uses across these sectors. See: International Renewable Energy Agency (IRENA), 2014. REmap 2030: A Renewable Energy Roadmap. Abu Dhabi. LINK

  147. International Energy Agency (IEA), 2014. Electricity Information (2014 preliminary edition). IEA Data Services. LINK

  148. Module prices: International Energy Agency (IEA), 2014. Energy Technology Perspectives 2014. Paris. LINK

  149. Cost comparisons quoted here do not in general include full system costs / grid costs, as discussed in subsequent sections. For cost estimates and statements on auctions, see:

    REN21, 2014. Renewables 2014 Global Status Report. Paris: Renewable Energy Policy Network for the 21st Century. LINK

    And:

    International Energy Agency (IEA), 2013. Technology Roadmap: Wind Energy – 2013 Edition. Paris. LINK

  150. Liebreich, M., 2014. Keynote address, Bloomberg New Energy Finance Summit 2014, New York, April 7. LINK

  151. IEA, 2014. Energy Technology Perspectives 2014 (module prices).

  152. Ernst & Young, 2013. Country Focus: Chile. RECAI: Renewable Energy Country Attractiveness Index, 39 (November), pp.24–25. LINK

  153. REN21, 2014. Renewables 2014 Global Status Report.

  154. International Renewable Energy Agency (IRENA), 2012. Solar Photovoltaics. Renewable Energy Technologies: Cost Analysis Series, Volume 1: Power Sector, Issue 4/5. International Renewable Energy Agency, Abu Dhabi. LINK

  155. For illustration, the IEA’s central scenario (New Policies) envisions solar and wind combined adding more electricity production than either coal or gas until 2035. See: IEA, 2013. World Energy Outlook 2013.

  156. Channell, J., Lam, T., and Pourreza, S., 2012. Shale and Renewables: a Symbiotic Relationship. A Longer-term Global Energy Investment Strategy Driven by Changes to the Energy Mix. Citi Research report, September 2012. LINK

    EIA, 2014. Levelized Cost and Levelized Avoided Cost of New Generation Resources in the Annual Energy Outlook 2014. LCOE for conventional coal in Table 1.

    International Energy Agency (IEA), 2014. Power Generation in the New Policies and 450 Scenarios – Assumed investment costs, operation and maintenance costs and efficiencies in the IEA World Energy Investment Outlook 2014. Capital costs for subcritical steam coal plants. Spreadsheet available at: LINK

    Nemet, G.F., 2006. Beyond the learning curve: factors influencing cost reductions in photovoltaics. Energy Policy, 34(17). 3218–3232. DOI:10.1016/j.enpol.2005.06.020.

  157. BP, 2013. BP Statistical Review of World Energy June 2013.

  158. IPCC, 2014. Summary for Policymakers (IPCC AR5, Working Group III).

  159. For an in-depth discussion of this topic, see Section 3.5 of Chapter 4: Energy of our report, as well as the NCE background paper on which it is based: Lazarus, M., Tempest, K., Klevnäs, P. and Korsbakken, J.I., 2014. Natural Gas: Guardrails for a Potential Climate Bridge. New Climate Economy contributing paper. Stockholm Environment Institute, Stockholm. LINK

  160. See, e.g., IPCC, 2014, Summary for Policymakers (IPCC AR5, Working Group III), and the range of scenarios in GEA, 2012. Global Energy Assessment.

    Also: IPCC, 2005. IPCC Special Report on Carbon Dioxide Capture and Storage. Prepared by Working Group III of the Intergovernmental Panel on Climate Change (Metz, B., O. Davidson, H.C. de Coninck, M. Loos, and L.A. Meyer, eds.). Cambridge University Press, Cambridge, UK, and New York. LINK

  161. Based on analysis by the New Climate Economy project team, in the IEA’s 2°C Scenario (2DS), the annual investment rate in CCS-equipped facilities would reach almost US$30 billion/year in 2020, with cumulative investment reaching more than US$100 billion. Projections are based on data from IEA, 2012, Energy Technology Perspectives 2012.

    Actual investment in 2007–2012 averaged only US$2 billion per year. See: IEA, 2013. Technology Roadmap: Carbon Capture and Storage 2013.

  162. IEA, 2011. Energy for All.

  163. For an in-depth discussion of these issues, see Section 3.4 of Chapter 4: Energy of our report, as well as: Jürisoo, M., Pachauri, S., Johnson, O. and Lambe, F., 2014. Can Low-Carbon Options Change Conditions for Expanding Energy Access in Africa? SEI and IIASA discussion brief, based on a New Climate Economy project workshop. Stockholm Environment Institute, Stockholm, and International Institute for Applied Systems Analysis, Laxenburg, Austria. LINK

  164. International Energy Agency, 2013. Energy efficiency market report.

  165. Planning Commission of the Government of India, 2013. India Energy Security Scenarios 2047.

  166. Analysis for the Global Commission, drawing on: IEA, 2012. World Energy Outlook 2012; GEA, 2012. Global Energy Assessment, and Bruckner et al., 2014. Chapter 7: Energy systems.

  167. Organisation for Economic Co-operation and Development (OECD), 2013. Inventory of Estimated Budgetary Support and Tax Expenditures for Fossil Fuels 2013. OECD Publishing, Paris. DOI: 10.1787/9789264187610-en.

  168. IEA, 2013. World Energy Outlook 2013.

  169. The International Monetary Fund took a different approach to calculating the value of fossil fuel subsidies, by including the cost of unpriced externalities such as climate change. The agency estimated a global value for such subsidies of US$2 trillion annually. See: International Monetary Fund (IMF), 2013. Energy Subsidy Reform: Lessons and Implications. Washington, DC. LINK

  170. IEA, 2013. World Energy Outlook 2013.

  171. The World Bank, 2014. State and Trends of Carbon Pricing 2014. Washington, DC. LINK

    Note: this statistic includes Australia, which has since removed its carbon tax.

  172. Climate Policy Initiative analysis for the New Climate Economy project, based on data from:

    International Energy Agency (IEA), 2012. Energy Technology Perspectives: How to Secure a Clean Energy Future. Paris. LINK

    Organisation for Economic Co-operation and Development (OECD), 2012. Strategic Transport Infrastructure Needs to 2030. Paris. LINK

    Organisation for Economic Co-operation and Development (OECD), 2006. Infrastructure to 2030. Paris. LINK

  173. Climate Policy Initiative analysis for the New Climate Economy project, based on data from: IEA, 2012, Energy Technology Perspectives; OECD, 2012, Strategic Transport Infrastructure Needs to 2030; and OECD, 2006, Infrastructure to 2030. Ratio of GDP is estimated by calculating GDP for 2015–2030 per the global growth rate projected in:

    Organisation for Economic Co-operation and Development (OECD), 2012. Medium and Long-Term Scenarios for Global Growth and Imbalances. OECD Economic Outlook, Volume 2012, Issue 1. Paris. LINK

  174. Kennedy. C. and Corfee-Morlot, J., 2012. Mobilising Private Investment in Low-Carbon, Climate-Resilient Infrastructure. Organisation for Economic Cooperation and Development (OECD) Working Papers. OECD, Paris. LINK

  175. Further details of policies to reform asset pricing are provided in Chapter 5: Economics of Change in our main report.

  176. Climate Policy Initiative (CPI), 2014. Roadmap to a Low Carbon Electricity System in the U.S. and Europe. San Francisco, CA, US. LINK

  177. Bloomberg New Energy Finance (BNEF), 2013. Development Banks: Breaking the US$100 billion a year barrier. New York. LINK

  178. Climate Policy Initiative analysis based on data from Bloomberg New Energy Finance.

  179. BNEF, 2013. Development Banks: Breaking the US$100 billion a year barrier.

  180. Dezem, V. and Lima, M.S., 2014. Wind-Farm Developers Win Biggest Share of Brazil Auction. Bloomberg. LINK

  181. See: Nelson, D., Goggins, A., Hervé-Mignucci, M., Szambelan, S.J., and Zuckerman, J., 2014 (forthcoming). Moving to a Low Carbon Economy: The Financial Impact of the Low-Carbon Transition. New Climate Economy contributing paper. Climate Policy Initiative, San Francisco, CA, US. LINK

  182. IEA, 2012. Energy Technology Perspectives. 

    International Energy Agency (IEA), 2014. World Energy Investment Outlook 2014. Paris. LINK

    Also: Platts World Electric Power Database and Rystad UCube database.

  183. This refers to a transition to a 2°C scenario from “business as usual”.

  184. For an in-depth discussion of stranded assets, see Section 5.1 of Chapter 6: Finance in our main report, as well as the background paper from which it is derived: Nelson, D., Goggins, A., Hervé-Mignucci, M., Szambelan, S.J., Vladeck, T., and Zuckerman, J., 2014 (forthcoming). Moving to a Low Carbon Economy: The Impact of Different Transition Policy Pathways on the Owners of Fossil Fuel Resources and Assets. New Climate Economy contributing paper. Climate Policy Initiative, San Francisco, CA, US. LINK

  185. Organisation for Economic Co-operation and Development (OECD), 2012. OECD Environmental Outlook to 2050. OECD Publishing, Paris. LINK

  186. US Energy Information Administration, 2014. EIA projects modest needs for new electric generation capacity. Today in Energy, 16 July. LINK

  187. International Energy Agency (IEA), 2013. Technology Roadmap: Energy Efficient Building Envelopes. Paris. LINK

  188. Sperling, D. and Lutsey, N., 2009. Energy efficiency in passenger transportation. The Bridge, 39(2). 22–30. LINK

  189. See: Google Inc., 2014. Helping our communities adapt to climate change. 19 March. LINK

  190. Bloomberg New Energy Finance, 2014. China Out-spends the US for the First Time in $15bn Smart Grid Market. 18 February. LINK

  191. US International Trade Commission, 2012. Remanufactured Goods: An Overview of the U.S. and Global Industries, Markets, and Trade. USITC Publication 4356. Washington, DC. LINK

  192. Ellen MacArthur Foundation, 2012. Towards a Circular Economy. Vol. 1. Cowes, Isle of Wight, UK. LINK

  193. Estimates are for 2010, as given in: Lucon, O. and Ürge‐Vorsatz, D., 2014. Chapter 9: Buildings. 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. LINK

  194. Ellen MacArthur Foundation, 2012. Towards a Circular Economy.

  195. Xu, D., 2014. How to build a skyscraper in two weeks. For the 96% recycled steel figure and more data from Broad Group, see the company’s Sustainable Building brochure: LINK

  196. National Institute of Building Sciences, 2014. Industry Proposes Innovative Method for Implementing Green Construction Code. LINK

  197. Nordhaus, W.D., 2002. Modeling induced innovation in climate-change policy. In Technological change and the environment. A. Grübler, N. Nakicenovic, and W.D. Nordhaus (eds.). Resources for the Future, Washington, DC. 182–209.

  198. Dechezleprêtre, A., Martin, R. and Mohnen, M., 2013. Knowledge Spillovers from Clean and Dirty Technologies: A Patent Citation Analysis. Centre for Climate Change Economics and Policy Working Paper No. 151 and Grantham Research Institute on Climate Change and the Environment Working Paper No. 135. London. LINK

  199. Prahalad, C.K. and Hammond, A., 2002. Serving the world’s poor, profitably. Harvard Business Review, 80(9). 48–57, 124.

  200. Hultman, et al., 2013. Green Growth Innovation.

  201. Harvey, I., 2008. Intellectual Property Rights: The Catalyst to Deliver Low Carbon Technologies. Breaking the Climate Deadlock briefing paper. The Climate Group. LINK

  202. Chiavari, J., and Tam, C., 2011. Good Practice Policy Framework for Energy Technology Research, Development and Demonstration (RD&D). Information Paper from the International Energy Agency. Paris. LINK

  203. Organisation for Economic Co-operation and Development (OECD), 2012. Energy and Climate Policy: Bending the Technological Trajectory. Paris. LINK

  204. The Pew Charitable Trusts, 2013. Advantage America: The U.S.-China Clean Energy Trade Relationship in 2011. Philadelphia, PA, US. LINK

  205. The OECD and Eurostat have defined the sector thus: “The environmental goods and services industry consists of activities which produce goods and services to measure, prevent, limit, minimise or correct environmental damage to water, air and soil, as well as problems related to waste, noise and eco-systems. This includes cleaner technologies, products and services that reduce environmental risk and minimise pollution and resource use.”

    See: OECD and Eurostat, 1999. The Environmental Goods and Services Industry: Manual for Data Collection and Analysis. Organisation for Economic Co-operation and Development, Paris, and Statistical Office of the European Communities, Brussels. LINK

    Data cited are from: Office of the United States Trade Representative (USTR), 2014. WTO Environmental Goods Agreement: Promoting Made-in-America Clean Technology Exports, Green Growth and Jobs. Fact sheet, July 2014. LINK

    Total global trade was estimated at US$18 trillion in 2012. See: United Nations Conference on Trade and Development, 2013. UNCTAD Handbook of Statistics 2013. Geneva. LINK

  206. United Nations Environment Programme (UNEP), 2013. Green Economy and Trade – Trends, Challenges and OpportunitiesLINK

  207. Carbon Trust and Shell, 2013. A “MUST” WIN: Capitalising on New Global Low Carbon Markets to Boost UK Export GrowthLINK

    The estimate uses the International Monetary Fund classification of emerging and developing economies: LINK

  208. The US had a small trade surplus in the year reviewed, 2011. See: The Pew Charitable Trusts, 2013, Advantage America.

  209. For an overview, see: Höhne, N., Ellermann, C. and Li, L., 2014. Intended Nationally Determined Contributions under the UNFCCC. Discussion paper. Ecofys, Cologne, Germany. LINK

  210. The Intergovernmental Panel on Climate Change (IPCC) warns that historical GHG data are quite uncertain, especially for the more distant past (e.g. the 18th and 19th centuries). The allocation of historical responsibility also changes based on the starting point chosen (1750, 1850, or as late as 1990), the gases considered (CO2 or all GHGs), and whether emissions from land use, land use change and forestry (LULUCF) are included. Citing den Elzen et al., 2013 (see below), the IPCC notes that, for example, developed countries’ share of historical emissions is almost 80% when non-CO2 GHGs, LULUCF emissions and recent emissions are excluded, or about 47% when they are included. Citing Höhne et al., 2011 (see below), the IPCC adds: “As a general rule, because emissions of long‐lived gases are rising, while emissions of the distant past are highly uncertain, their influence is overshadowed by the dominance of the much higher emissions of recent decades.”

    See: Victor, D. and Zhou, D., 2014. Chapter 1: Introductory Chapter. 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. LINK

    Den Elzen, M.G.J., Olivier, J.G.J., Höhne, N. and Janssens-Maenhout, G., 2013. Countries’ contributions to climate change: effect of accounting for all greenhouse gases, recent trends, basic needs and technological progress. Climatic Change, 121(2). 397–412. DOI:10.1007/s10584-013-0865-6.

    Höhne, N., Blum, H., Fuglestvedt, J., Skeie, R. B., Kurosawa, A., et al., 2011. Contributions of individual countries’ emissions to climate change and their uncertainty. Climatic Change, 106(3). 359–391. DOI:10.1007/s10584-010-9930-6.

  211. Victor and Zhou, 2014. Chapter 1: Introductory Chapter. See in particular Figures 1.4 and 1.6.

  212. See Victor and Zhou, 2014, Chapter 1: Introductory Chapter, as well as: Winkler, H., Jayaraman, T., Pan, J., de Oliveira, A.S., Zhang, Y., Sant, G., Miguez, G., Letete, T., Marquard, A., Raubenheimer, S., 2011. Equitable Access to Sustainable Development: Contribution to the Body of Scientific Knowledge. A paper by experts from BASIC countries. BASIC expert group: Beijing, Brasilia, Cape Town and Mumbai. LINK

  213. Buchner, B., Herve-Mignucci, M., Trabacchi, C., Wilkinson, J., Stadelmann, M., Boyd, R., Mazza, F., Falconer, A. and Micale, V., 2013. The Landscape of Climate Finance 2013. Climate Policy Initiative, San Francisco, CA, US. LINK

    “Climate finance” includes capital investments costs and grants targeting low-carbon and climate-resilient development with direct or indirect greenhouse gas mitigation or adaptation objectives and outcomes. The data relate to 2011–12.

  214. Buchner et al., 2013. The Landscape of Climate Finance 2013.

  215. Buchner et al., 2013. The Landscape of Climate Finance 2013.

  216. Michaelowa, A., and Hoch, S., 2013. FIT For Renewables? Design options for the Green Climate Fund to support renewable energy feed-in tariffs in developing countries. World Future Council, September 2013. LINK

    Deutsche Bank (DB), 2011. GET FiT Plus, De-Risking Clean Energy Models in a Developing Country Context, DB Climate Change Advisors, September 2011. LINK

  217. International Centre for Trade and Sustainable Development, 2014. APEC talks “green goods,” trade remedies in background. BIORES, 22 August. LINK

  218. Ghosh, A., and Esserman, E., 2014. India-US Cooperation on Renewable Energy and Trade. India-US Track II Dialogue on Climate Change and Energy. LINK

  219. Velders, G.J.M., Solomon, S. and Daniel, J.S., 2014. Growth of climate change commitments from HFC banks and emissions. Atmospheric Chemistry and Physics, 14(9). 4563–4572. DOI:10.5194/acp-14-4563-2014.

    Velders et al. note: “If, for example, HFC production were to be phased out in 2020 instead of 2050, not only could about 91–146 GtCO2-eq of cumulative emission be avoided from 2020 to 2050, but an additional bank of about 39–64 GtCO2-eq could also be avoided in 2050.” The totals range from 130 to 210 GtCO2e by 2050.

  220. See: LINK

  221. LINKLINK and LINK