The world's most high-profile climate change sceptic is to declare that global warming is "undoubtedly one of the chief concerns facing the world today" and "a challenge humanity must confront", in an apparent U-turn that will give a huge boost to the embattled environmental lobby.

Bjørn Lomborg, the self-styled "sceptical environmentalist" once compared to Adolf Hitler by the UN's climate chief, is famous for attacking climate scientists, campaigners, the media and others for exaggerating the rate of global warming and its effects on humans, and the costly waste of policies to stop the problem.

But in a new book to be published next month, Lomborg will call for tens of billions of dollars a year to be invested in tackling climate change. "Investing $100bn annually would mean that we could essentially resolve the climate change problem by the end of this century," the book concludes.

Examining eight methods to reduce or stop global warming, Lomborg and his fellow economists recommend pouring money into researching and developing clean energy sources such as wind, wave, solar and nuclear power, and more work on climate engineering ideas such as "cloud whitening" to reflect the sun's heat back into the outer atmosphere.

In a Guardian interview, he said he would finance investment through a tax on carbon emissions that would also raise $50bn to mitigate the effect of climate change, for example by building better sea defences, and $100bn for global healthcare.

His declaration about the importance of action on climate change comes at a crucial point in the debate, with international efforts to agree a global deal on emissions stalled amid a resurgence in scepticism caused by rows over the reliability of the scientific evidence for global warming.

The fallout from those rows continued yesterday when Rajendra Pachauri, head of the UN Intergovernmental Panel on Climate Change, came under new pressure to step down after an independent review of the panel's work called for tighter term limits for its senior executives and greater transparency in its workings. The IPCC has come under fire in recent months following revelations of inaccuracies in the last assessment of global warming, provided to governments in 2007 – for which it won the Nobel peace prize with former the US vice-president Al Gore. The mistakes, including a claim that the Himalayan glaciers could melt by 2035, prompted a review of the IPCC's processes and procedures by the InterAcademy Council (IAC), an organisation of world science bodies.

The IAC said the IPCC needed to be as transparent as possible in how it worked, how it selected people to participate in assessments and its choice of scientific information to assess.

Although Pachauri once compared Lomborg to Hitler, he has now given an unlikely endorsement to the new book, Smart Solutions to Climate Change. In a quote for the launch, Pachauri said: "This book provides not only a reservoir of information on the reality of human-induced climate change, but raises vital questions and examines viable options on what can be done."

Lomborg denies he has performed a volte face, pointing out that even in his first book he accepted the existence of man-made global warming. "The point I've always been making is it's not the end of the world," he told the Guardian. "That's why we should be measuring up to what everybody else says, which is we should be spending our money well."

But he said the crucial turning point in his argument was the Copenhagen Consensus project, in which a group of economists were asked to consider how best to spend $50bn. The first results, in 2004, put global warming near the bottom of the list, arguing instead for policies such as fighting malaria and HIV/Aids. But a repeat analysis in 2008 included new ideas for reducing the temperature rise, some of which emerged about halfway up the ranking. Lomborg said he then decided to consider a much wider variety of policies to reduce global warming, "so it wouldn't end up at the bottom".

The difference was made by examining not just the dominant international policy to cut carbon emissions, but also seven other "solutions" including more investment in technology, climate engineering, and planting more trees and reducing soot and methane, also significant contributors to climate change, said Lomborg.

"If the world is going to spend hundreds of millions to treat climate, where could you get the most bang for your buck?" was the question posed, he added.After the analyses, five economists were asked to rank the 15 possible policies which emerged. Current policies to cut carbon emissions through taxes - of which Lomborg has long been critical - were ranked largely at the bottom of four of the lists. At the top were more direct public investment in research and development rather than spending money on low carbon energy now, and climate engineering.

Lomborg acknowledged trust was a problem when committing to long term R&D, but said politicians were already reneging on promises to cut emissions, and spending on R&D would be easier to monitor. Although many believe private companies are better at R&D than governments, Lomborg said low carbon energy was a special case comparable to massive public investment in computers from the 1950s, which later precpitated the commercial IT revolution.

Lomborg also admitted climate engineering could cause "really bad stuff" to happen, but argued if it could be a cheap and quick way to reduce the worst impacts of climate change and thus there was an "obligation to at least look at it".

He added: "This is not about 'we have all got to live with less, wear hair-shirts and cut our carbon emissions'. It's about technologies, about realising there's a vast array of solutions."

Despite his change of tack, however, Lomborg is likely to continue to have trenchant critics. Writing for today's Guardian, Howard Friel, author of the book The Lomborg Deception, said: "If Lomborg were really looking for smart solutions, he would push for an end to perpetual and brutal war, which diverts scarce resources from nearly everything that Lomborg legitimately says needs more money."

• This article was amended on 31st August 2010 to remove an accidental duplication of the quote from Rajendra Pachauri.