Limiting global warming to 2°C above pre-industrial levels is absolutely crucial, says the G8 and most of the world’s best climatologists. If this is to be more than lip service, the consequences will be radical.
For starters, until 2050, only a total of around 700 gigatonnes of carbon dioxide can be emitted into the atmosphere. At the current rate of emissions, this “budget” will be exhausted in 20 years; if emissions increase as expected, the world will become carbon “insolvent” even sooner. So reducing carbon dioxide and other greenhouse gas emissions must begin as quickly as possible. Wasting any more time will cause costs to skyrocket and render the 2°C limit obsolete.
The rich North cannot continue as before, emerging industrial countries must abandon the old industrial-based path to prosperity, and the rest of the world may not even embark upon it. Yet the negotiations on emissions limits with each of the 192 signatory countries in the run-up to the Copenhagen Summit in December have so far given no indication of so radical a change.
A global climate deal must be simpler, fairer and more flexible than today’s Kyoto Protocol. To achieve this, the Global Change Council of Germany suggests that a budget formula be adopted. The idea is that in future all states will be allocated a national per capita emissions budget that links three core elements of a fair global climate deal: the major industrial countries’ historical responsibility, individual countries’ current performance capacity and global provision for the survival of mankind.
The task is immense. On a global level, quick and comprehensive de-carbonization of the world economy is necessary. All countries must reduce their use of fossil fuels and switch to renewable energy sources as soon and as much as possible.
But since the OECD countries (led by the US and Australia) will soon overrun their carbon budgets even after far-reaching emissions reductions, they must cooperate with developing countries that still have budget surpluses. Breaking the Gordian knot of climate negotiations requires offering technology and financial transfers in exchange for the ability to overrun a national budget.
A responsible global climate policy thus entails a fundamental change of international relations, and making the necessary institutional innovations in global governance requires courage. Until now, the wealth of nations has been based upon the combustion of coal, gas and oil. But if the 2°C target is taken seriously, the 21st century will see countries that are not so far down the path of carbonization (such as large parts of Africa) or that leave it in time (such as India and Pakistan) able to become wealthy by helping societies that must de-carbonize rapidly.
For the moment, all this remains utopian. In its current state, cap-and-trade schemes to reduce emissions are far from being fair and effective; a major improvement would include establishing a Central Climate Bank to register and supervise the transfer of emissions credits. This bank would also ensure that emissions trading did not run counter to the goal of remaining within the entire global budget, for example via the complete sale of unused emissions credits by individual developing countries at the beginning of the contract period.
In order to achieve this, the Central Climate Bank must have the power to do its job. This, in turn, implies that it is accountable and that it has democratic legitimacy — something fundamentally lacking in multilateral agencies such as the World Bank.