Rhein on Energy and Climate

Humanity is becoming gradually aware that climate change is taking its toll on nature and hurting men, animals and plants alike, everywhere on earth.

Scientists tell us that we have to reduce carbon dioxide and methane emissions to 50 percent of 1990 levels (!) before 2050 if we want to avoid a dangerous rise of average global temperatures beyond 2° by the end of the century.

But there is little public debate on the practical measures that should be taken to prevent a climate catastrophe; and few EU citizens understand the implications of the December 2009 climate package.

What needs to happen effectively to stabilise the earth’s climate?

First, the price of fossil energy should be substantially higher, as it does not reflect the “external costs” that burning of fossil fuel causes to the environment and climate.

Governments therefore need to urgently abolish all fossil fuel subsidies and impose very high excise duties on gasoline, gas, fuel and coal. For political reasons they tend to shy away from this. Many governments even continue subsidising the use of fossil energies. These should be abolished as a matter of absolute priority!

Second, as an alternative to higher excise taxes governments should impose quantitative caps on the amounts of fossil energy that power plants and energy-intensive companies may consume. Steadily declining caps, which companies must buy, will lead to rising C02 market prices and induce companies to reduce their consumption of fossil energy just like high excise taxes.

Third, governments should fix mandatory energy efficiency standards to business and citizens. The EU and other countries have done so for automobiles, buildings and electric lamps; but there remains considerable scope for additional action, especially in power generation and buildings. In due time, governments will have to impose zero C02 emission standards on new power plants and buildings!

Fourth, governments should subsidise the use of renewable energies (wind, solar, biomass) in view of making them more attractive compared to fossil energies. But there are fiscal limits to this approach.

Fifth, governments in countries with large forest areas, especially in tropical regions, should take more effective measures for forest conservation, as deforestation constitutes a major source of global C02 emissions. The rest of the world should contribute to these efforts. Forests constitute a common heritage of humanity; all countries on earth therefore have a vital interest in their conservation.

Sixth, the 20 major emitting countries, accounting for some 80 percent of global emissions, must be the main actors against climate change. They must develop appropriate technologies and policies. Others, especially developing countries, should follow suit at a later stage.

Seventh, combined these measures will generate the changes of technology, policies and incentives required for progressively reducing C02 emissions to substantially lower levels.

Brussels, 15.03.09 Eberhard Rhein

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