‘Low-carbon economy’ presents early escape from darker future
A future of water scarcity, flooding, and desertification, especially in the already vulnerable Middle East and North Africa (MENA) region, could be avoided with a switch to low carbon economy, economist Dirk Messner argued.
“[This] is not an environmental challenge, but a development one,” said Messner, also the director of the German Development Institute (DIE), one of the leading think-tanks for development policy worldwide.
“It’s “about pressure on soil and food; about pressure on water; about how to reorganize energy, and about a stable climate system [and] security.”
Continuing with business as usual does not guarantee a safe future, he said.
Messner warned that if the global community doesn’t react within one or two decades, it will run into irreversible dynamics. With the global economy basing 85 percent of its energy sources on fossil fuel and 15 percent on renewables, this is a long-term challenge.
He described two scenarios of unstoppable global temperature increases, one by 6 degrees celsius – unknown territory in human history – by 2050 due to greenhouse emissions (carbon dioxide), as opposed to another of 2 degrees, associated with immediate preventative measures of shifting to “low-carbon.”
The second scenario is only possible if a cap of 750 gigatons of carbon dioxide emissions was enforced by 2050. Most economies would have made the low-carbon transition by then and emissions would be guaranteed to decrease in the future.
This scenario would entail reversing the current situation with the aim of eventual dependence of 80 percent on renewables and 20 percent on fossil fuels.
Messner, however, warned that the global economy is under “huge time pressure,” and that the current costs for financing the transition (amounting to 2-2.5 percent of global GDP) are not very expensive when compared to future costs. If action is only taken in 2020, the decrease would have to be by 9 percent.
The MENA region was among the most vulnerable to the temperature increases, as the changing climate would annihilate current water supplies, produce permanent soil damage, he argued. In Egypt, the climate change will lead to wiping out the fertile Nile Delta region.
However, the region also held potential competitive advantage in the low-carbon arena, as it provides the perfect environment for solar and wind energy, in addition to the plentiful natural gas reserves, which are part of the overall low-carbon strategy.
“Only 2-3 other places on Earth are equally equipped with natural capabilities to develop a low-carbon network,” he said.
The opportunities for the countries of North Africa is immense, he said, as their energy grid could be linked to the poorer southern parts of Africa and for the energy-hungry European neighbors in the north. “You [North Africans] might be the driver of this kind of restructuring.”
By 2020 or 2030, 50 percent of European energy consumption might be based on imports from MENA, underscoring its importance, he added.
Egypt’s own natural gas reserves, he explained, would be the bridge towards the transition, rather than a nuclear energy option, “because it is the least carbon-intensive carrier.”
He noted that Egypt already had a natural gas partnership with the EU, through 2008 memorandum of understanding that included articles on mutual diversifying of energy sources, improving energy efficiency, and developing renewable energy infrastructure.
On her part, Magda Kandil, director of the Egyptian Center for Economic Studies, cautioned against the natural gas option as it would not be positively perceived by the public, which is already against exporting natural gas. She also noted the current scarcity of the Egyptian reserves.
She, however, said that Egypt must shift its energy dependence by targeting its available sources, for an eventual 20 percent from renewables by 2020, dividing it into 12 percent from wind and 8 from hydroelectric and solar energies.
When breaking down the costs of the MENA low-carbon transition, Messner explained that 50 percent of it will be for transport and mobility investments, 20 percent for energy infrastructure, 15 percent to research and development, and 15 percent for land use and developing industrial sectors.
As for cost convergence to low-carbon, he said that the technology prices would still increase by 10 percent over the next two decades, until technology spreads and becomes mainstream, after which costs will significantly decrease beyond 2030.
The current challenge is how to bring together a group of countries to go low-carbon.
“Imagine a world in which Europe, India, and China and parts of the US and MENA would decide to go to a low-carbon direction,” he said, “the rest of the world would ask themselves then if they can continue [feasibly] going high-carbon.”