|Policy Type:||Research, Development and Deployment (RD&D)>Research programme , Policy Support>Strategic planning|
|Agency:||Her Majestys Treasury|
Published on 30 October 2006 by Nicholas Stern, Head of the Government Economic Service and former World Bank Chief Economist, the Stern Review on the Economics of Climate Change was commissioned in July 2005 by the Chancellor. The first half of the Review focuses on the impacts and risks arising from uncontrolled climate change, and on the costs and opportunities associated with action to tackle it. The Review finds that all countries will be affected by climate change, but it is the poorest countries that will suffer earliest and most. Unabated climate change risks raising average temperatures by over 5°C from pre-industrial levels. Adding up the costs of a narrow range of the effects, based on the assessment of the science carried out by the Intergovernmental Panel on Climate Change in 2001, the Review calculates that the dangers of unabated climate change would be equivalent to at least 5% of GDP each year. The Review goes on to consider more recent scientific evidence (for example, of the risks that greenhouse gases will be released naturally as the permafrost melts), the economic effects on human life and the environment, and approaches to modelling that ensure the impacts that affect poor people are weighted appropriately. Taking these together, the Review estimates that the dangers could be equivalent to 20% of GDP or more. In contrast, the costs of action to reduce greenhouse gas emissions to avoid the worst impacts of climate change can be limited to around 1% of global GDP each year. The second half of the Review examines the national and international policy challenges of moving to a low-carbon global economy, setting three priorities for effective climate change mitigation. The first is carbon pricing, through taxation, emissions trading or regulation, aiming to build a common global carbon price across countries and sectors. The second is technology policy, to drive the development and deployment at scale of a range of low-carbon and high-efficiency products. The third is action to remove barriers to energy efficiency, and to inform, educate and persuade individuals about what they can do to respond to climate change.
Last modified: Thu, 02 Nov 2017 19:48:26 CET