Climate Change 2001: Synthesis Report

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The primary economic benefits of mitigation are the avoided costs associated with the adverse impacts of climate change.


Greenhouse gas emission reduction (mitigation) action would lessen the pressures on natural and human systems from climate change. Comprehensive, quantitative estimates of global primary benefits of mitigating climate change do not exist. For mean temperature increases over a few ºC relative to the year 1990, impacts are predominantly adverse, so net primary benefits of mitigation are positive. A key uncertainty is the net balance of adverse and beneficial impacts of climate change for temperature increases less than about a few ºC. These averages conceal wide regional variations.

9.29 Mitigation generates costs and ancillary benefits.

9.30 Major reductions in global greenhouse gas emissions would be necessary to achieve stabilization of their concentrations. For example, for the most important anthropogenic greenhouse gas, carbon cycle models indicate that stabilization of atmospheric CO2 concentrations at 450, 650, or 1,000 ppm would require global anthropogenic CO2 emissions to drop below year 1990 levels within a few decades, about a century, or about 2 centuries, respectively, and continue to decrease steadily thereafter. Emissions would peak in about 1 to 2 decades (450 ppm) and roughly a century (1,000 ppm) from the present. Eventually stabilization would require CO2 emissions to decline to a very small fraction of current global emissions. The key uncertainties here relate to the possibilities of climate change feedbacks and development pathways and how these affect the timing of emissions reductions.

9.31 Mitigation costs and benefits vary widely across sectors, countries, and development paths. In general, it is easier to identify sectors -- such as coal, possibly oil and gas, and some energy-intensive industries dependent on energy produced from these fossil fuels -- that are very likely to suffer an economic disadvantage from mitigation. Their economic losses are more immediate, more concentrated, and more certain. The sectors that are likely to benefit include renewable energy, services, and new industries whose development is stimulated by demand for low-emission fuels and production techniques. Different countries and development paths have widely different energy structures, so they too have different costs and benefits from mitigation. Carbon taxes can have negative income effects on low-income groups unless the tax revenues are used directly or indirectly to compensate such effects.

Q7.14, Q7.17, & Q7.34
9.32 Emission constraints in Annex I countries have well established, albeit varied, "spill-over" effects on non-Annex I countries. Analyses of the effects of emissions constraints on Annex I countries report reductions below what would otherwise occur in both projected GDP and in projected oil revenues for oil-exporting non-Annex I countries.

9.33 Lower emissions scenarios require different patterns of energy resource development and an increase in energy R&D to assist accelerating the development and deployment of advanced environmentally sound energy technologies. Emissions of CO2 due to fossil-fuel burning are virtually certain to be to the dominant influence on the trend on the atmospheric CO2 concentration during the 21st century. Resource data assessed in the TAR may imply a change in the energy mix and the introduction of new sources of energy during the 21st century. Fossil-fuel resources will not limit carbon emissions during the 21st century. The carbon in proven conventional oil and gas reserves is much less, however, than the cumulative carbon emissions associated with stabilization of CO2 at levels of 450 ppm or higher.25 These resource data may imply a change in the energy mix and the introduction of new sources of energy during the 21st century. The choice of energy mix and associated technologies and investments -- either more in the direction of exploitation of unconventional oil and gas resources, or in the direction of non-fossil energy sources, or fossil energy technology with carbon capture and storage -- will determine whether, and if so, at what level and cost, greenhouse concentrations can be stabilized. Key uncertainties are the future relative prices of energy and carbon-based fuels, and the relative technical and economic attractiveness of non-fossil-fuel energy alternatives compared with unconventional oil and gas resources.


Studies examined in the TAR suggest substantial technological and other opportunities for lowering mitigation costs. National mitigation responses to climate change can be more effective if deployed as a portfolio of policy instruments to limit or reduce net greenhouse gas emissions. Significant progress in energy-saving and low-carbon technologies has been made since 1995, and the progress has been faster than anticipated in the SAR. Net emission reductions could be achieved through, inter alia, improved techniques in production and use of energy, shifts to low- or no-carbon technologies, CO2 removal and storage, improved land-use and forestry practices, and movement to more sustainable lifestyles. Significant progress is taking place in the development of wind turbines, solar energy, hybrid engine cars, fuel cells, and underground CO2 storage. Key uncertainties are (a) the likelihood of technological breakthroughs leading to substantial reductions in costs and rapid take-up of low-carbon processes and products, and (b) the future scale of private and public R&D expenditures on these technologies.

Q7.6-7, Q7.14-15, Q7.20, & Q7.23, & Q7 Box 7-1

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