By PricewaterhouseCoopers, 2008
BAU Scenario
BAU scenario assumes, firstly, that improvements in energy intensity (measured in terms of the rate of decline in the ratio of primary energy consumption to GDP) average around 1.5% per annum globally, but with some variations by country and over time to reflect recent trends. This BAU assumption is in line with average global energy intensity improvements in 1980-2005 and can be used to generate projections for primary energy consumption to 2050 both at national and global level.BAU scenario shows that, while global GDP is projected to grow by around 325% cumulatively between 2006 and 2050 (3.4% per annum on average), primary energy consumption is projected to grow by only around 140% cumulatively over this period (2.0% per annum on average) due to energy efficiency improvements.BAU scenario further assumes that: the fuel mix between gas, coal, oil and others is constant in each country; and there is no use of carbon capture and storage (CCS).Given these assumptions, carbon emissions from energy use grow broadly in line with primary energy consumption, increasing by around 140% cumulatively between 2006 and 2050, or by around 2% per annum on average.The power generation and transport sectors see the most rapid growth rates in emissions in this scenario, reflecting the expected patterns of development in the major emerging economies and the rise in car ownership in these countries. But all sectors of the global economy see significant cumulative growth in emissions in this scenario, which reinforces the need for an economy-wide approach to moving to a low carbon world, rather than a strategy focused on a few key sectors.The implication of this BAU scenario is a projected rise in CO2 concentrations in the atmosphere from around 385 parts per million (ppm) now to around 600ppm by 2050, with an accelerating upward trend being evident at that date.Since the latest scientific analysis detailed in the 2007 IPCC reports suggests aiming for global CO2 stabilisation at around 400-475 ppm (or around 450-550ppm for CO2 equivalent totals of all greenhouse gases), this outcome would seem clearly unsustainable in terms of implied rates of global warming and the associated risks of severe adverse effects on health, the economy, agriculture (and so global food supply) and the natural world.
Greener Growth Scenario
Green Growth + CCS’ scenario seem that time to be sufficient to put global carbon emissions on a path consistent with long-term stabilisation of atmospheric CO2 concentrations at what was judged then to be an acceptable level of around 450ppm.In the next 15-20 years energy efficiency improvements for vehicles, power plants, factories and buildings would play the most important role in this scenario, but renewables and CCS would also become increasingly important in delivering the required reductions in carbon emissions beyond around 2025 once these technologies became more mature and their unit costs reduced accordingly.This scenario has the following enhanced features: the rate of reduction in energy intensity is set at 1.5% per annum and the share of renewable and nuclear power in total primary energy consumption is assumed to rise to around 50% by 2050.The reductions would encompass all major economies, but with the G7 economies being required to reduce emissions by 2050 by around 80% compared to 2006, whereas the E7 emerging economies (led by China and India) might aim initially to restrain the growth of emissions up to around 2020 and only later start to reduce them at an accelerating rate.The transport sector may prove particularly challenging here, given the rapid expected growth in car ownership in emerging economies and the difficulties at present in finding economically viable and technically feasible alternatives to oil-based fuels for motor vehicles (and indeed also for air transport). However, over such a long time period, it seems likely that some kind of technical breakthroughs might be achieved in this field and indeed these advances may well come in large part from the emerging economies like China or India, who are facing the greatest environmental challenges from increased car ownership, rather than from the OECD countries.Basic features of this policy framework will need to be:Early global political agreement on long-term targets for carbon emission reductions that allow for fair burden sharing between developed and less developed economies;Some global inter-linked mechanisms for putting a price on carbon, whether this be through trading, taxation or possibly some combination of the two; andOther supporting policies including support for development and early stage implementation of new technologies such as CCS, green technology transfer to less developed economies, direct regulation in areas where economic instruments may be less effective (e.g. energy efficiency standards for buildings and household appliances), and action to reduce and eventually reverse deforestation and promote conservation tillage in agricultural sectors.
