OECD and International Energy Agency, 2003
The scenarios are differentiated on the bases of two variables: pace of technological change and attitudes towards the global environment. With each variable characterised by a "high" and "low" level, four different scenarios are derived. Assuming the reference case is technology and environmental awareness that proceed along current paths, three additional cases can be analysed: the high environment, low technology case (referred to as "Clean but not sparkling"), the high technology but low environmental case (called "Dynamic but careless"), and the high technology and high environment case, referred to as "Bright skies".
- Clean, but not Sparkling. This scenario is characterised by a strong concern for the global environment by both the public and policymakers but a relatively slow rate of technological change. Contrary to a common wisdom for which strong pro–environment policies would lead to a rapid development of environmental friendly technologies, a number of other factors could put such an outcome at risk. In this scenario a combination of pessimistic perceptions about technology and overzealous policy intervention do not allow for the full potential of technological development to be released. Furthermore, insufficient investment in R&D or failure of these research efforts to produce results leads to limited technological progress. As in this scenario technologies fail to deliver, environmental goals are largely met through induced changes in behaviour, and likely only at rather high costs.
- Dynamic but Careless. This scenario is characterised by very dynamic technological change, low priority for climate change mitigation and a generalised belief that sustained growth and rapid progress in technologies will take care of all problems without need for much policy intervention. As a corollary, this scenario has more rapid economic growth than the first one, including more open but less regulated markets. Unhindered economic growth is the main priority, shared by developed and developing countries alike. However, not all countries are able to achieve fast growth rates and some lag behind. Global threats such as climate change take a back seat in the concerns of both citizens and politicians. Although energy represents a relatively small share of production inputs or household spending, low energy prices and security of supply are considered an important condition for economic growth. At the beginning, progress is faster in fossil fuel based technologies, helping to maintain low prices. In both developed and developing countries local environmental problems are not ignored but are dealt with at the local level and consistently with the economic resources of the affected communities or individually through pollution impact averting behaviour. As a consequence of these initial conditions, fossil fuel demand grows rapidly, followed by an increase in GHG emissions. These two factors increase the likelihood of energy security of supply crises and worsening environmental conditions. To deal with security of supply, and in the continuous quest for low energy costs the system accelerates the development of new technologies. While the first phase of this scenario is therefore heavily oriented towards fossil fuel-based technologies, in the second part of the scenario horizon, non-fossil technologies emerge too.
- Bright Skies. This scenario is characterised by both rapid technological change and strong concern for the global environment by both the public and policymakers. Other features of this scenario include a (global) GDP growth rate somewhere in between the first two cases but closer to the second, robust trade and market liberalisation trends, a narrowing down of income differences across regions and countries. As a result, overall, energy prices will be somewhat higher than in the second scenario but lower than in the first. In this scenario, governments of developed countries agree to deal with the threat of climate change in a co-ordinated fashion and to take action to slow down and reverse current trends in GHG emissions. In due time they are joined in this process by developing countries, who agree to take increasingly stringent commitments for GHG emission control and reduction. Domestically, developed country governments set out to design and implement policies that will, on the one hand, encourage a reduction of energy-related GHG emissions and, on the other, channel both government and private resources towards development of new technologies for climate change mitigation. These efforts produce a host of positive technological outcomes, which allow the attainment of environmental goals, and also enhance energy security while keeping prices relatively low.
