ceteris paribus...
 
 


Cutting emissions can benefit firms

 Based on article from The Telegraph, 8October 2006

Tackling climate change is usually associated with economic costs but reports show that if governments are willing, there are huge commercial benefits to be gained.

It is predicted that the concentration of greenhouse gases is 380 parts per million, which is rising at about 2ppm each year.

Cutting greenhouse emissions is not just a problem in developed countries but a growing problem in the emerging economies such as India and China. With 1.3bn people in China, it is widely expected that it will emit much more per head compared to the current third as much as Europe and a tenth of the US's.

Large cuts in emissions will be quite hard as emissions increase with economic prosperity - scientists predict global emissions will double by around 2050 to 14bn tonnes of carbon annually.

Some example of how 1bn tonnes of carbon emissions per year can be reduced by 2054 include:

  • With the predicted 2bn cars in the world by 2050, they should be capable of 60 miles per gallon not the current 30mpg
  • A 50 fold expansion of global wind power usage
  • A 100 fold expansion of biomass fuel usage to the current level of Brazil's ethanol production

According the the International Energy Agency, this can all be done at a moderate cost. Due to better technology, the cost of wind power has gone down from about 6 cents per kWh to 4 cents. Companies can also save money as they could spend a fifth less on energy by 2050 and also cut emissions by a fifth at the same time.

 

 
 
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