David Fuller's view -
A far-reaching deal on climate change in Paris over coming days promises to unleash a $30 trillion blitz of investment on new technology and renewable Energy by 2040, creating vast riches for those in the vanguard and potentially lifting the global economy out of its slow-growth trap.
Economists at Barclays estimate that greenhouse gas pledges made by the US, the EU, China, India, and others for the COP-21 climate summit amount to an epic change in the allocation of capital and resources, with financial winners and losers to match.
They said the fossil fuel industry of coal, gas, and oil could forfeit $34 trillion in revenues over the next quarter century – a quarter of their income – if the Paris accord is followed by a series of tougher reviews every five years to force down the trajectory of CO2 emissions, as proposed by the United Nations and French officials hosting the talks.
By then crude consumption would fall to 72m barrels a day - half OPEC projections - and demand would be in precipitous decline. Most fossil companies would face run-off unless they could reinvent themselves as 21st Century post-carbon leaders, as Shell, Total, and Statoil are already doing.
The agreed UN goal is to cap the rise in global temperatures to 2 degrees centigrade above pre-industrial levels by 2100, deemed the safe limit if we are to pass on a world that is more or less recognisable.
Climate negotiators say there will have to be drastic "decarbonisation" to bring this in sight, with negative net emissions by 2070 or soon after. This means that CO2 will have to be plucked from the air and buried, or absorbed by reforestation.
Such a scenario would imply the near extinction of the coal industry unless there is a big push for carbon capture and storage. It also implies a near total switch to electric cars, rendering the internal combustion engine obsolete.
One of life’s lessons in this era is never underestimate the influence of developing technologies and their ability to change the world. Another is that most technological breakthroughs are achieved within capitalist economic systems.
Moreover, once new technologies become economically competitive, there is no stopping their development, including an ongoing series of previously unimaginable enhancements. A good example in our era of accelerating technological innovation is the progress of solar power, discussed by Mark Lewis, the chief author of Barclays’ report on Renewables in a latter portion of the article above:
"The average cost of global solar was $400 a megawatt/hour worldwide in 2010. It fell to $130 in 2014, and now it has fallen below $60 in the best locations. Almost nobody could have imagined this six years ago," he said.
This is immensely encouraging when considering the risks of manmade climate change. However, we also need luck because no one knows how various climate change risks will play out over time, even if we could theoretically end our carbon emissions overnight.
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