Cities can invest in climate solutions and still thrive

The following article was originally published by the Daily Climate

Nations don't have to choose between promoting prosperity and tackling climate change, according to a report released today by an international panel of government and business leaders.

In an effort to shape next week's United Nations Climate Summit, the group of high-ranking executives and officials detailed how countries can grow their economies at the same time they act to halt global warming.

The recommendations of the Global Commission on the Economy and Climate, led by former Mexico president Felipe Calderon, include ideas long part of the climate action agenda: Build more compact cities with better mass transit, restore degraded land, stop deforestation, phase out fossil fuel subsidies, set a price on carbon. But the commission aimed at garnering new and broader support by compiling evidence that the steps also can drive positive economic transformation.

Economic growth and climate solutions

"There is a general perception that taking responsible efforts to tackle climate change could reduce economic growth, could reduce the creation of jobs," said Calderon in a conference call prior to the report's release. "Our conclusion is that you can have economic growth and tackle climate change, but that will require structural changes in the coming years."

Calderon led the U.N. climate talks in 2010 in Cancun, where debate indeed became stymied by economic concerns. He said the next 15 years will be critical for the transformations needed. Over that time, the commission estimated that $90 trillion will be invested in the world's land-use and energy systems – power plants, highways, electric grids—and in its fast-growing cities. 

That investment in turn will set the stage for future growth patterns and living standards. It could take the world a significant way toward meeting – or blowing  – the international goal of keeping future warming below 2 degrees Celsius.

'Risky Business'

The Calderon Commission's report is one of a number of efforts to reshape the debate on climate and the economy released this year. 

One of the most noticed was "Risky Business," led by former U.S. Treasury Secretary Hank Paulson, former New York Mayor Michael Bloomberg, and political activist Tom Steyer. Released in June, it sought to detail the costs of the consequences of climate change, like rising seas and threatened agriculture. 

Tuesday's report, commissioned by the governments of seven developed and developing nations (Colombia, Ethiopia, Indonesia, Norway, South Korea, Sweden and the United Kingdom) focuses instead on the economic benefits of climate solutions.

The World Resources Institute served as managing partner to the commission. WRI president Andrew Steer said it is part of a broad effort to shift the paradigm of the climate debate with an eye not only to the Climate Summit in New York on Sept. 23, but upcoming negotiations in November in Lima, Peru and next year in Paris.

'Wrong understanding'

"The perception that many leaders – both of business and country – still have that it would be nice to act on climate but it's costly, and we may have to wait before we move forward is a wrong understanding," Steer said. "In fact, what we need to do to get the world economy to grow and prosper is exactly the same as what we need to do to move towards a lower carbon economy.

"It's not the old-fashioned notion of assessing costs and benefits and going forward cautiously," he said. "It's actually good economics, and it can even be good politics for a mayor or for a corporation to act boldly."

The commission, which included Mayors Annise Parker of Houston and Eduardo Paes of Rio de Janeiro, singled out cities as an area where policymakers can focus to help cut carbon emissions while improving quality of life. 

Impacts of unplanned growth

Too much urban growth today is unplanned, the report said. Instead, transit-oriented urban development could reduce per capita car use by 50 percent while reducing household expenditures by 20 percent.

Adopting a compact, transit-oriented model in the world's largest 724 cities, the report said, could reduce global greenhouse-gas emissions by up to 1.5 billion tons of carbon dioxide equivalent per year by 2030. 

Curitiba, Brazil, is one of the country's most affluent cities, the report noted. But it has 25 percent lower per capita GHG emissions and 30 percent lower fuel consumption than the national average due to its transit-oriented development. Older cities can benefit, too: "Re-densification" efforts underway in London, Brussels, Tokyo, Hamburg, Nagoya and Beijing are already making impacts, the commission said. 

Market failure

The commission was co-chaired by Lord Nicholas Stern of London School of Economics, renowned as author of the 2006 report for the United Kingdom's government,  one of the first efforts to examine in depth the economic impact of climate change. In that report, he characterized climate change as one of the greatest market failures the world had ever seen. 

The new report aims to lay out practical steps for correcting that failure. "The key thing is fostering investment of the right kind," Stern said in the pre-launch conference call. "That is going to drive the economic, structural, and technological transformations, and at the same time drive down carbon emissions." 

But that will require bold leadership in both nations and the corporate world, he added. "Vacillation and wobbling is the enemy of investment."