World leaders must take immediate and co-ordinated action, or risk locking the world into a calamitous temperature rise of up to six degrees as demand for energy, food, and water overwhelms the planet.
That is the shocking conclusion of a new report
published today by the OECD, which projects that without a drastic change in policies the world will be woefully unprepared to support a population cresting the nine billion mark by the middle of the century.
Under current policies, the world economy is expected to quadruple by 2050 and consume 80 per cent more energy than today. This is projected to lead to an energy system that sources 85 per cent of its power from fossil fuels and "runaway emissions" 55 per cent that are higher than today, Simon Upton, environment director of the OECD, told reporters today.
Echoing a report released
by the International Energy Agency (IEA) last year, the OECD warns that increased emissions will drive temperature rises well above the two degree limit most scientists agree is needed to avoid the worst effects of climate change.
According to the report 80 per cent of emissions through to 2020 are already "locked in" to the energy system, while the pledges made by governments fall well short of a cost-efficient pathway to delivering the two degrees temperature limit agreed at an international level.
The report also warns that the knock-on effects on water stress, biodiversity and health could prove catastrophic, calculating that unless governments move to tackle the issues now the costs are mitigating climate risks will increase by 50 per cent.
Upton said these inter-related challenges could lead to a "surrender scenario", where the expense of rectifying an energy system locked in to fossil fuels becomes almost insurmountable.
But acting now is cost-effective: a global carbon price sufficient to lower emissions by nearly 70 per cent to 2050 would slow economic growth by only 0.2 percentage points per year on average, costing just 5.5 per cent of global GDP.
The OECD wants governments to embrace a series of green policies, including making pollution more costly through taxes and levies, properly valuing natural assets and eco-systems, and removing fossil fuel subsidies, which in the OECD countries alone are valued at between $45bn and $75bn a year.
Governments must also take a lead in producing more effective regulation and standards, and fostering green innovation, the report argues, warning that progress on an incremental, piecemeal basis will not be enough.
"The key message is that governments cannot choose bits [to address]," Upton said. "Do a bad job in energy and it will hit you in water or biodiversity.
"Governments have to send signals that affect investment long term. Without a long-term price signal that steadily rises, you're not going to get investors following the right path. Beyond 2020 we can make a real difference, but we need to invest now."
While the report focuses on actions governments can take, Upton said there are also important consequences for businesses in terms of embedding climate risks into their long-term strategies.
"If, for example, your business relies on cheap water you can waste, it may not be there for you to waste it. So the first mover advantage is going to be for industries that read those signals and take action to put themselves at the leading edge."