13 March, 2008
Politicians should stop pretending that decarbonising our economies can be done on the cheap. This is the conclusion of a damning analysis of EU climate/energy policies published by Oxford energy professor Dieter Helm in the Wall Street Journal today.
Helm starts his evaluation with a critical look at the EU’s achievements in terms of emission reductions. The apparent decoupling of economic growth and emissions is just “smoke and mirrors”, says the UK expert. If one factors in the “carbon outsourcing” (our imports from China, where the EU and US have exported their smoke-stack industries), the picture is less rosy.
“If this carbon outsourcing is factored back in, the U.K.’s impressive emissions cuts over the past two decades don’t look so impressive anymore. Rather than falling by over 15% since 1990, they actually rose by around 19%. And even this is flattering, since the U.K. closed most of its coal industry in the 1990s for reasons unrelated to climate change. No doubt, recalculating the figures for other European countries and the U.S. would reveal a similar pattern.”
It is consumption and not production that matters, according to Dieter Helm.
“This means that if global warming is to be limited, the U.S. and Europe will have to take much more drastic action to reduce those emissions embedded in their own consumption. Their appropriate emissions-reduction targets will have to be based on the consumption of goods that cause those emissions in the first place. This not only means that the true scale of required emissions reductions in the Western world will be much higher but that the impact on economic growth and living standards there will also be more severe than so far believed.”
Criticising the Stern report, Helm goes on to explain why he thinks costs of decarbonising our economies will be much higher. There will be high “policy costs” with policy makers investing heavily in the wrong solutions.
Helm’s conclusion is strong but, in my view absolutely correct:
“The U.S. and Europe refuse to acknowledge that halting the relentless rise in the concentrations of greenhouse gases in the atmosphere will take a significant slice out of economic growth. It will probably mean living standards will have to be cut if our consumption is going to be environmentally sustainable. We are simply living beyond our — and the planet’s — means.”
More interesting energy commentaries and publications are available on Helm’s personal web site.Author : Willy De Backer