The world isn't spending nearly enough to combat climate change

The easiest way to determine if a government or organization is serious about solving the problems of climate change is to look at how much money they think it will require to make meaningful improvements.  Regular readers know the baseline number around here is $100 trillion but I am willing to consider higher numbers.  The biggest problem with our modest number is that I am assuming that the money quickly gets into the hands of honest, low-corruption Producers.  And in places like Holland, Germany, and Scandinavia, that is a reasonable assumption.

But since that sort of Kantian honesty is not a universal social characteristic, $100 trillion is probably the minimum.  One of the details that emerged in the austerity debates between Greece and Germany last spring was the factoid that roads cost more than double to build in Greece as in Germany.  Not surprisingly, a Producer culture yields higher economic performance.  So if your goal is the well-built and sophisticated infrastructure necessary for a green society, it helps a LOT if you already have an advanced Producer culture.

The International Energy Agency is now saying we need to spend $7 Trillion per year to build the low-carbon society.  The world spent 391 $Billion in 2014 so spending, according to IEA, needs to ramped up by a factor of nearly 20.

Sounds right to me.

The World Isn't Spending Nearly Enough To Combat Climate Change -- Not Even Close

This is a moral, economic and geopolitical failure.

Ben Walsh, Business Reporter, The Huffington Post 3DEC2015

Finance is full of big numbers, and for almost every big number, there is another, even bigger number it should be compared to.

Climate change is no different. As world leaders meet for climate talks in Paris, here's the big number: In 2014, the world invested $391 billion in low-carbon and climate-resilient infrastructure. And here's the even bigger number: We should actually be spending $7 trillion dollars a year for the next decade, and even more later.

The International Energy Agency estimated in a recent report that the world needs to spend $359 trillion between now and 2050 to avoid catastrophic climate change.

It isn't just that we're not investing enough money; we're not investing enough money by a factor of more than 17. And that's a moral, economic and geopolitical failure.

Meanwhile, if we don't do anything to try to limit climate change, the world will spend $318 trillion by 2050 on the kind of greenhouse gas-producing energy and transportation infrastructure that actually fuels climate change. To limit climate change, that money needs to be spent on clean infrastructure, not dirty energy projects. And beyond shifting the money we are already projected to spend on dirty energy to clean infrastructure, the world needs to invest an additional $40 trillion over 35 years to keep the rise in global temperatures below 2 degrees Celsius.

The extra $1 trillion per year investment in clean energy that is needed, above and beyond what we are already projected to spend, has been dubbed the "clean trillion" by nonprofit sustainability advocacy group Ceres, and that's what we should really be aiming for. "The world needs to be shifting trillions into clean energy, not just billions," Christopher Fox, a director at Ceres, told The Huffington Post.

Unfortunately, countries aren't yet making the commitments needed to limit climate change to 2 degrees Celsius, said Uwe Remme, an energy modeler at the IEA. But if countries retire old coal plants and take other measures to promote energy efficiency by 2020, those efforts could put us back on track to limiting climate change, Remme said.

To address climate change in the long term, countries should be focusing their trillions of dollars in infrastructure spending on building a low-carbon economy that won't exacerbate the problems we already have.

"Combating climate change requires shifting global investment from fossil fuels to clean energy," Fox said.

In the end, our challenge isn't about finding the money to fight climate change -- the money is there, but it's being spent on the wrong things.

"The world needs to decide," said the U.N.'s chief climate negotiator, Christiana Figueres, in November. Is our money "going to go into clean technology, clean infrastructure, and above all, resilient infrastructure -- or is it going to go into the technologies and infrastructure of the last century?" more