Why Can't We Innovate Our Way to a Carbon-Free Energy Future?

Despite pledges such as the 2008 promise by the Group of Eight (G8) industrialized nations to work to cut global carbon emissions in half by 2050 under the Kyoto Protocol, no meaningful international climate agreement has ever been reached, says Bjorn Lomborg, head of the Copenhagen Consensus Center and adjunct professor at Copenhagen Business School.

The Kyoto approach proposes a "solution" that is more expensive than the problem it's meant to solve.

* To cut carbon emissions enough to keep average global temperatures from rising any higher than 2 degrees Celsius above pre-industrial levels -- a goal endorsed by the G8 -- we would have to slap a huge tax on carbon-emitting fuels.
* Huge means something on the order of $4,000 per ton of carbon dioxide -- or $35 per gallon of gasoline -- by the end of the century.
* The impact of a tax of this magnitude would be devastating -- it could reduce world gross domestic product (GDP) by a staggering 12.9 percent in 2100 (the equivalent of $40 trillion a year).

The best estimate is that if we don't do anything about global warming, by 2100 it will be doing roughly $3 trillion a year in damage to the world. In other words, under the Kyoto approach, we'd be spending $40 trillion a year to prevent $3 trillion a year in environmental damage, says Lomborg.

Fortunately, there is a smarter way than carbon cuts to deal with global warming. What if, instead of crippling economic growth by trying to make carbon-emitting fuels too expensive to use, we devoted ourselves to making green energy cheaper?

Research has found that devoting just 0.2 percent of global GDP -- roughly $100 billion a year -- to green energy research and development would produce the kind of game-changing breakthroughs needed to fuel a carbon-free future.

Not only would this be a much less expensive fix than trying to cut carbon emissions, it would also reduce global warming far more quickly.

Source: Bjorn Lomborg, Why Can't We Innovate Our Way to a Carbon-Free Energy Future?" Investor's Business Daily, October 22, 2010.

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