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Climate policy vs financial crisis, round 2

Posted by: Adam Aston on October 15, 2008

Last week, I posted some worries about how the high energy prices, the credit crunch and a looming recession are likely to derail progress on climate change. In the days since, the credit crisis has shifted to Europe and brought climate questions to the fore. Reuters reports that France is considering offering its industries opt-outs to soften the pain of a recession. Charles Haneley, writing for AP, says that a success story of the current climate regime — the transfer of wealth from rich countries to poorer ones to fund greenhouse gas reduction — is threatened given the growing shortage of funds. A co-bylined piece in the Guardian goes the farthest, bluntly pointing out that European countries may use the economic crisis as an excuse to ditch or delay climate goals.

Reader Comments

Yasser, Pakistan

October 17, 2008 3:37 AM

To "fund greenhouse gas reduction" in poor countries is going to have no effect. For poor countries, the things on the agenda are cheap electricity (or even its availability), food, jobs and better quality of life. Juxtaposing climate change with poor countries would be a comedy routine for the masses of the poor countries.


November 6, 2008 9:33 AM

Given the feebleness of most climate change "action," a recession might not do much derailing. On the one hand, first high energy prices and now the recession have meant noticeable reductions in fossil fuel use, at least for motor fuels. What climate policy has yet managed to achieve that? And while a recession might lead governments to opt out of carbon capping schemes, on the other hand the odds are greater every day that the response to this recession will be a green Keynesianism, with government investment in renewable energy infrastructure. (The risk there is that industries like ethanol and "clean coal" will have the clout to push the Keynesianism in their direction and away from more legitimate alternatives.)

A combination of private market pain at the pump and government subsidized renewable energy generation is unlikely to achieve as much as a well designed and strict carbon cap scheme (and once again I'll plug Peter Barnes' "cap-and-dividend" version), but it might achieve more than we were realistically going to get absent an overarching climate policy.

G. Green

December 5, 2008 11:55 AM

Energy demand is projected to grow at least 50 per cent by 2030. Energy generated by biomass and waste is estimated to supply 10 per cent of global demand by 2030. This assumes that fossil fuels will be available to cover most of the demand increase. Unfortunately, energy-related carbon dioxide emissions are projected to increase faster than energy use by 2030.

Energy use has impacts at all levels. Pollution from burning fossil fuels and the related impact of acid rain constitute serious problems for Asia, North American and European forests, lakes and soils. Stringent emission controls may reverse acidification trends. Thermal and nuclear power and solar cells generate waste disposal problems that may result in heavy metal soil contamination. Desertification in North Africa and sub-Saharan Africa is caused partly by biomass fuel demand. Natural resources are overtaxed by increasing energy usage and invasive alien species are entering many regions through global trade due to relatively available transportation fuels.

However, climate change remains by far the most deleterious impact of increasing energy usage. Species ranges and behaviors are shifting and impacting human well-being, including spreading human disease and invasion by alien species. Rare and threatened species will be affected seriously, including migratory species, polar species, genetically weak species, marginal populations and specialized species, especially those in alpine areas and islands. Amphibian species extinctions are linked with climate change. Recently, scientists have estimated that 1/4 to 1/3 of endemic species in various regions may become extinct by 2050 due to climate change. For a broad discussion of global warming and renewable energy souces, please visit

Climate change is impacting ecosystems. By 2000, 1/4 of the globe's coral reefs were degraded by increased water temperatures. Ecosystems in California, the Mediterranean, Chile, South Africa and Western Australia will be heavily impacted by climate change.

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BusinessWeek correspondents John Carey and Mark Scott, cover the green scene, keeping on top of the business aspects of energy, the environment and climate change, as well as the technologies, policies, markets and people that are shaping how the earth's resources will be used in the century ahead.

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