ANALYSIS - Climate Change Appeal Fails to Silence Sceptics
Date: 31-Oct-06
Country: UK
Author: Gerard Wynn
British Prime Minister Tony Blair welcomed the U.K.-backed report as "the most important report on the future published by this government", and his finance minister Gordon Brown said it meant environmental policy was now economic policy.
The report's author, former World Bank chief economist Nicholas Stern, argued that urgent action on climate change now would save some US$2.5 trillion compared with doing nothing, and would help avert possible economic and planetary catastrophe.
The weighty report provides ammunition for Blair's drive to persuade the United States, as well as fast-growing developing nations China and India, to sign up to a new global framework to curb greenhouse gas emissions.
The report is also meant to galvanise industry to invest in "green" energy and make people see the sense of taxes to limit the use of emissions-producing fossil fuels.
"It's about creating carbon markets, creating a price incentive to cut back on carbon, about promoting research and development, about encouraging energy efficiency," Stern said.
"Above all it's international, it's getting countries to move together," he told Reuters after delivering the 580-page report to Blair and Brown.
One thing on which all analysts, policy makers, investors and lobbyists seemed to agree was this need for global action.
British Foreign Secretary Margaret Beckett will brief ambassadors in London on Stern's report while Stern himself will visit the United States and other countries to talk to academics, government officials and environmental groups.
"Unless you have an international framework which has not just Europe, but America and China and India in it then there will be a limit to the degree to which your company is going to get fully behind this," said Blair.
The world does not have a good record on curbing greenhouse gases. The United States, the world's biggest emitter, in 2001 pulled out of the Kyoto Protocol, the only world-wide policy on climate change.
"The US government has produced an abundance of economic analysis on the issue of climate change," Kristen Hellmer, spokeswoman for the White House Council on Environmental Quality, said. "The Stern report is another contribution to that effort."
"The fact is there's a very, very deep body of scepticism and resistance...not only in the United States although that's perhaps the focal point," said Michael Grubb, chief economist at Britain's Carbon Trust, a group which spearheads Britain's drive to a low-carbon economy.
CREDIBILITY
While Washington's full support for Stern's findings was always uncertain, some of its implications will sit uneasily even with the European Union.
It calls for action to keep greenhouse gases at a level in the atmosphere -- up to 550 parts per million -- which the EU has in the past rejected as too high, saying it risks dangerous climate change which it defines as an average 2 degrees Celsius global warming.
"(550 ppm) offers at most a one in six chance of respecting the 2 degrees target," the European Commission said last year.
"Limiting the temperature rise to 2 degrees would very probably require greenhouse gas concentrations to be stabilised at much lower levels," it said.
The report by Stern, the British government's chief economist, earned a sceptical response from some fellow economists.
At the core of the report was the message that urgent action now would cost up to 20 times less than doing nothing.
"Telling people that this (action on global warming) will cost quite a trivial sum is giving the wrong kind of direction," said Dieter Helm, an economics fellow at New College, Oxford. "I think 1 percent of GDP is probably quite low."
Others were unimpressed by Stern's cost estimate of doing nothing.
"It assumes that society will never get used to higher temperatures, changed rainfall patterns, or higher sea levels. This is a rather dim view of human in