Achim Steiner, the head of the UN environment programme, said: “Far more worrying [than formally ratifying a treaty] is that every month we delay we send a ambiguous signal into the world economy, the markets, investors and R&D.” The markets had not yet had that strong signal, said economist Lord Nicholas Stern of the London School of Economics. “That’s what we can give in Copenhagen with a strong political agreement. If we get nothing then it would be very damaging to confidence.” He told the Guardian: “Could we make a huge step forward in Copenhagen? Yes. Will we certainly do it? No.”
All participants have accepted that it is impossible to seal a legally binding climate treaty at next month’s summit. The question now is whether leaders will be able to set firm “politically binding” targets for carbon emission reductions and the funding that rich nations need to provide for poorer nations to cope with global warming and develop green technologies.
“Delinking GDP from emissions is premised on the fact that developed countries will assist developing countries,” said Steiner. He said the funding figures on the negotiating table were “exploratory” and “not transfomative and on a magnitude that would send a major signal to the market” on clean technologies. The EU has adopted Gordon Brown’s figure of $100bn (£60bn) a year by 2020, but Stern said: “This is right at the bottom end of enough and will not be credible unless there is $50bn by 2015.”
The danger of uncertainty over clean technology investments was an immediate problem, according to Steiner: “Many countries have to make decisions right now where they are going to invest in, say, coal-fired power stations or renewable energy sources which have a premium up front, and these decisions are being influenced certainly by uncertainty on a price on carbon.”
“Take a country like South Africa, which is planning on investing billions in new energy infrastructure over the next 10-15 years – you can’t put those decisions off ad nauseam,” he added. There was a “real risk” that countries, especially developing ones, would invest in existing “off-the-shelf” technologies that would lock in high carbon emissions for 20-30 years, he said. “Furthermore, a delay in investment is obviously the worst piece of news you can have in terms of getting out of a recession.”
Stern argued that Copenhagen was the moment to begin the transition to a low-carbon sustainable economy, which would be cleaner, quieter and more secure. “We could by wise investment and policies now set the world on a course where we would see arguably the most dynamic period of technologically driven growth in economic history – probably bigger than the railways or electricity.”
“We might see Asia leading the charge on this new technology and China is certainly seeing this as the big growth story of the next 2-3 decades.” The risks of missing the opportunity were great, Stern added: “Let’s set ourselves on a path of growth that has a real future and not just high carbon growth and a new bubble, because high carbon growth will kill itself, firstly on the high price of hydrocarbon [fuels], and secondly on the extremely hostile physical environment it creates.”
Business-as-usual scenarios created a 50% chance of a 5C temperature rise by the next century, Stern said: “We haven’t been there for 300m years. It would redraw shores, patterns of rivers, where deserts are, most of the reasons why we live and work where we do. There would be huge migrations and conflicts that would be global, prolonged and severe.
Stern acknowledged that electricity prices would go up by 20-30%, but said that would be “a very reasonable price to pay” for the reduction in climate risk such green energy would deliver, given appropriate price protection for poorer consumers. Figures released by UNEP in June showed that in 2008, clean technologies attracted $140bn of investment compared with $110bn for gas and coal for electrical power generation. But investment has fallen significantly in 2009, with green technologies suffering disproportionately.
Nonetheless Angus McCrone, of analysts New Energy Finance, remained upbeat on the clean technology investment picture, if not the broader one: “There are a lot of positive things going on [in relation to Copenhagen]. But whether that’s enough to deal with climate change is another question.”