We need to accelerate our work on climate change, says Blair
Speech to a Beijing business forum on Chinese business leadership in a low carbon economy, 18 March, 2008
Four years ago, as Prime Minister of the UK, I supported the establishment of a leading international body - The Climate Group - set up in London and which now operates around the world, to catalyze and accelerate government and business leadership on climate change to help put the world back on track towards a low carbon future.
I am delighted to see today that The Climate Group has officially set up its presence here in the world's most populous country and started to engage actively with government and business leadership in China to seek solutions towards that low carbon economy.
And I am privileged to have the opportunity to speak to you all - the Chinese business leaders who are making great efforts to integrate energy efficiency, renewable energy sources, resource and environmental protection into your business development.
Though we are facing a daunting challenge of energy security and climate change globally, creative business leaders see the opportunities to charter a clean and efficient future, and also do well for business at the same time.
So what is part of the consensus? What is agreed?
1. The science is overwhelming - we must act now to cut global greenhouse gas emissions. The IPCC 4th assessment report states it is at least 90% certain that human emissions of greenhouse gases rather than natural variations of climate are responsible for global warming.
Average global temperature and sea levels are rising and this rise is accelerating at an unprecedented rate. The impacts of this can be seen in the loss of glaciers, sea ice and permafrost.
The panel says we must cut global emissions in half from 1990 levels with a peak in emissions by 2015 if we are to have a reasonable chance of avoiding a greater than 2 degree rise.
2. There is a consensus between most politicians and business leaders that the period 2007-10 offers both a major challenge and a major opportunity for international climate policy to facilitate and to drive tangible emission reductions globally.
Last year, at the German G8 in Heiligendamm, world leaders accepted the need for substantial reduction in global emissions by 2050, taking note of the EU proposal to cut emissions in half by mid-century.
All major countries have some climate policies in place, as do major regional governments, for example California, and cities, like London, Beijing, Shanghai and Los Angeles.
Businesses also around the world are developing low carbon products and services and taking individual action to cut their carbon footprint.
3. However, we know the response is still not commensurate with the scale of the problem. Emissions are still growing faster than at any time before. There have been good and strong commitments recently, for example: the EU has pledged a 20% reduction by 2020, Germany 36% by 2020, and the UK 60% by 2050, China to cut carbon intensity 40% by 2020, and 80% by 2050. Despite all this, in many countries emissions are rising.
If the world continues on its current energy path, dominated by fossil fuels, energy related CO2 emissions in 2050 will, according to the IEA, be two and a half times their current levels.
The impacts are increasingly being felt around the world.
4. Climate change is not an environmental issue alone, it is deeply entwined with other major economic, social and political issues.
Poverty eradication in the developing world requires economic growth but a different kind of low carbon growth.
Climate change interacts directly with challenges such as, food security, disease, water provision, biodiversity loss, fisheries loss.
Climate change reduces the ability of the planet to deal with other environmental shocks.
Climate change requires us to rethink how we want to achieve our legitimate human and national aspirations to grow and lift people out of poverty. In other words, how we channel imagination, ingenuity and entrepreneurship into creating a low carbon and prosperous world, free of dependence on fossil fuels.
The shift to a low carbon economy also presents an enormous economic opportunity for rich and poor countries alike. There are clear synergies between energy efficiency and reducing GHG emissions on the one hand and other strategic goals, for example, resource productivity, energy security, energy provision, water supplies, reduced air pollution. So there are real gains out of bold action.
With the right incentives in place, there are enormous sums of money primed to be invested in the low carbon economy - Sir Nicholas Stern estimates that markets for low carbon energy products could be worth $500bn/year by 2050. For example, the biofuels market is set to triple by 2015; clean technology is already the fastest growing sector for venture capital investments. Energy sector investments alone are likely to top $20 trillion by 2030.
China's wind turbine capacity increased by 134% in 2007 to 6GW and ranks fifth in the world with 7% of global capacity. China's wind turbine technology still lag a few years behind the state of the art, but is priced at about 30% less than European products - If the level of technology keeps improving China could become the world leader in both construction and production of wind energy.
China is expected to surpass Japan as the number 1 solar panel manufacturer in 2008 and already controls 25% of the global $12.9 billion market. Although local installations are small, China exports 90% of production and is strategically positioned to gain as the global solar market takes off.
China's budding Energy Service Company (ESCO) industry has saved over 50 mT of CO2 in 2006 through inventive investments and financing of energy efficiency technologies in many projects. There is ample room for this industry to grow by another 10 times or more and China is already starting to export ESCO services overseas.
It is predicted that China's local renewable energy market will require $398 billion in investment by 2020. China has a huge opportunity to develop a finance and investment infrastructure to nurture this market and specialise in low carbon investments.
In the Clean Development Mechanism (CDM) established by the Kyoto Treaty, China accounted for 61% of the supply of carbon emission reduction credits in 2006 and completed trading of over $3 billion in that year. China is a major beneficiary of carbon trading schemes and this market will continue to grow.
The direction of policy is clear. But the questions is this: how do we put together a global agreement that allows all these good things to be dramatically accelerated because we need that acceleration to happen for this problem to be solved.
In my judgment what we need to do is put together a sensible, political, global agreement that does these things:
Firstly, that incentivises not just governments but businesses and industry to develop the science and technology of the future because the only solution to this lies in science and technology.
Second, an agreement that defines what we mean when we talk about 'common but differentiated responsibilities' between the developed and developing world. In the modern political language, everybody says there has got to be a global agreement, everyone has got to be in it - that means America as well as China - but we cannot expect the obligations to be the same because the stages of development are different.
So people rightly say the answer therefore lies in the UN language of 'common but differentiated obligations'. The question is what does that mean? So the second task is to try and define what those obligations are on the part of the developed and developing countries.
And the third thing this global agreement has got to do is allow the transfer of technology and give the appropriate financial support so that in the developing world this technology can be accessed easily and implemented, at a cost that is shared and not at a cost that would impede the growth of the developing countries.
So it has got to be fair and efficient, but above all else it has got to be an agreement that accelerates the pace of change.
Because, the difficulty with this is that although what the obligations are between the developed and developing world is a matter of fairness, unfortunately the climate doesn't care where the emissions are coming from America, China, the UK or India.
So the point is to get a fair system but has to be a system that accelerates the pace of change.
Your input as business leaders here in China will be essential in that process. You are defining the future directions of your businesses. Your view will have a big impact, not just on how China sees the path to a low carbon future, but also the rest of the world.
The truth is, without China's leadership and commitment, this problem cannot be solved. And yet we know it has to be solved in way that still allows developing countries to lift their people out of poverty. So the deal has to be one that allows countries like China and India to grow, but to grow in a way that is sustainable.
And so the Western and developed world has to take on the obligation, knowing that it is us that have created the problem, and that we face up to our responsibilities in a just solution to solving it.
Thank you.
Watch Tony Blair announce the Breaking the Climate Deadlock project on YouTube
