Some Basic Policy Analytics for Global Emissions Mitigation Jeffrey D. Sachs UNESCO “Building Green Societies” November 25, 2011

Green Growth Requires Breakthroughs on Five Dimensions: Low-Carbon Energy System Sustainable Food Supply: Land, Water, Nitrogen Urban Sustainability: Pollution, Public Health, Transport Population: Rapid Growth, Migration Resilience: Climate, Migration, Diversity I will focus just on the first of these...

Basic Relationship: CO2 i = Pop i x (GDP/Pop) i x (TPES/GDP) i x (CO2/TPES) i CO2 i is CO2 emissions of country i Pop is Country Population TPES is Total Primary Energy GDP is GDP at Purchasing Power Parity

Remarkable Consistency in TPES/GDP: World 0.19 tons of oil equivalent / $1000 GDP US 0.19 China 0.18 France 0.17 Japan 0.14 Sweden 0.16 India 0.15

Differences in CO2/TPES depend on Energy Mix World 2.39 tons of CO2 per toe US 2.40 China 3.03 (coal based power) France 1.38 (nuclear based power) Japan 2.32 Sweden 0.92 (hydro based power) India 2.35

For the World as a Whole Today: Pop 7 billion GWP/Pop $10,000 TPES/GWP 0.20 tons per $1,000 GWP CO2/TPES 2.4 tons per toe CO2 ≈ 7 x 10 x 0.2 x 2.4 ≈ 33.6 giga (billion) tons per year

Each ton of CO2 emitted raises atmospheric CO2 by around 0.5 tons. Each GT of atmospheric CO2 raises CO2 concentrations by around 1/7.81 parts per million (ppm). Hence, current emissions raise CO2 concentrations by around 33.6 GT x 0.5 x 1/7.81, which equals: +2.2 ppm per year

Pre-Industrial Carbon Dioxide = 280 PPM Current Carbon Dioxide = 390 PPM Safe Limits: Range is between 350 PPM and 450 PPM At the current rate of increase, we will reach 450 PPM By around In fact, emissions are accelerating.

Global Growth: Per capita income is rising around 3 percent per year Population is rising around 1 percent per year With 0.5 – 1.0 percent per year reduction of TPES/GDP the rise in TPES is around 3 – 3.5 percent per annum.

Now assume that the rich world grows by 1 percent of GDP per capita per year The rest of the world catches up with a catch-up Coefficient of 1.45 (Barro-Lee) [but faster for China, India] The growth of the rest of the world initially is 3 percent per person or roughly 4 percent total GDP

On these assumptions, Gross World Product is: $70 trillion in 2010 $140 trillion in 2030 $250 trillion in 2050 The GWP therefore increases approximately 3.6X by mid-century (40 years)

On plausible scenarios, the world must reduce emissions by at least half (to 16 GT per annum) by mid-century. This implies reducing CO2/GWP by (1/2) * (1/3.6) = (1/7.2)X Thus, instead of 0.45 tons per $1,000 PPP, we would need 0.06 tons per $1,000 PPP. Note that no country comes close to this rate today. Sweden is at 0.2, on the low end.

The strategy must be both to: (1)reduce TPES/GDP (efficiency) and to (2)reduce CO2/TPES (de-carbonization) De-carbonization may include non-C primary energy and Carbon Capture and Sequestration (CCS). De-carbonization will tend to accompany a shift from direct combustion (ICE, boilers) to electrification (e.g. electric vehicles) and fuel cells (e.g. hydrogen)

Hypothesis: The World Can Agree to (1)Converge on low (CO2/GDP) by (2)Share best technologies (3)Support low-income countries to achieve low CO2 energy systems

Note: I am assuming that we will move beyond “historical responsibility” “equal per capita rights” “compensation” “single global policy regime” such as cap-and-trade and instead adopt a convergence framework

Suppose that the world aims to converge at 0.06 tons per $1,000 GDP. Emissions profiles would be roughly as follows: US 6T 1.4T China 7T 3.0T India 1.6T 2.0T

Each Country Commits to Converge on CO2/GDP Each Country Describes its Profile in four terms: CO2/TPES TPES/GDP Technology Framework Policy Framework Global Green Fund based on Carbon Emissions Shared Global R&D on EVs, CCS, Renewables, Nuclear GLOBAL POLICY FRAMEWORK

Global Green Fund Global Green Fund will fund adjustment by Low- Income Countries. Global Green Fund will collect CO2 levy on HICs and MICs Assessment (i) = CO 2 Emissions (i) x CO 2 Assessment Rate x GDP Factor (i) The Assessment Rate is expressed in $US/tons of CO 2 The GDP Factor is as follows: High-income country (>$12,276): 1.0 High Middle-income country ($3,976-$12,275): 0.5 Low Middle-income country ($1,006-$3975): 0.25 Low-income country (<$1,005): 0.0

Illustration of Revenues Raised Globally