LONDON: The Climate Group said today that a rapid transition to clean energy could provide the economy with a major boost, and pointed to forecasts that the clean tech sector could soon be worth over $5 trillion. You can explore and share our related infographic below.

Representing a coalition of business and government leaders, The Climate Group makes its comments in advance of the launch of ‘Mitigation of Climate Change’, the report from the Intergovernmental Panel on Climate Change (IPCC) Working Group III which is expected to advocate a major global switch to renewable energy.

Mark Kenber, CEO, The Climate Group, says: “The Climate Group has been working with business and government partners to drive a ‘clean revolution’, a swift scale-up of clean energy, infrastructure, and of smart technologies. The IPCC reports make it clear this needs to happen now. This is no longer a theoretical discussion, though: 70-80% of the necessary technology is available today. What is needed is a combination of coordinated policy and corporate leadership to accelerate the transition.

“What is now beyond doubt is that the clean tech sector is an attractive proposition for any investor: the global market is now worth more than US$2.56 trillion* a year, and is expected to be valued at more than US$5.13 trillion by the mid-2020s. Just less than the combined GDPs of Germany and France. It is growing 12% a year and has been doing so steadily since 2007, a rate many of the world’s major economies would give an arm and a leg for. Top solar stocks averaged 302% over the past year, for example. A clean revolution is good news for consumers too - solar energy currently costs the same as electricity generated by coal and gas in many countries such as Germany, Italy and Mexico, with the cost trajectory on an ongoing downward path.”

Global challenge

Changhua Wu, Greater China Director, The Climate Group, says: “We have most of the technologies and tools to decarbonize economic growth. What is needed is the right policy incentives and political will to direct the capital flows towards a low carbon future.

“An ‘ecological civilization’ has been embraced as the philosophy to guide China’s future development. If you zoom in on this transformation unfolding now, you will see that what is recommended by the IPCC Working Group III is happening in the world’s second largest economy. Decarbonizing both energy production and consumption, maximizing energy efficiency potential, scaling up renewable energy, and improving society’s awareness and behavior change are all among the priority actions.

“Climate change is a global challenge. The solution requires consensus and cooperation among countries, especially among the major economies. This is not simply about reducing carbon emissions. It is about how we grow our economy and achieve prosperity in a totally different philosophy and paradigm. Scaling finance and scaling deployment of clean technologies available today will set us on the track towards the future we want.”

Bob Inglis, Energy & Enterprise Initiative Executive Director and former Republican Congressman, said: "We need innovation, and innovation will come most rapidly from free enterprise. Individual governments can spur that innovation by bringing accountability to emitters and by pricing carbon dioxide. America should pair that pricing with an income tax cut. That way we'd empower free markets to deliver innovation without growing government."

Security and faith leaders' views

Brigadier General Stephen Cheney, USMC (Ret.), the CEO of the American Security Project says: “Climate change is an accelerant of global instability that presents clear threats to national security for countries around the world. Last month, for the first time, the IPCC showed in its Working Group II report, how climate change is already harming security around the world – and how instability will grow worse without action.”

“We know that militaries and governments around the world are aware of the threat: ASP’s Global Security Defense Index showed that over 70% of the countries in the world have identified climate change as a threat to their national security. We see that militaries are preparing for the effects of climate change. However, proper risk management means that we must go further: we should act now to reduce emissions. That means switching to low and no-carbon sources of energy available now, and it means investing in the R&D needed to develop new sources of energy for the future. The military can lead on this, but we need the rest of society to come along as well.”

Deborah Fikes, Representative to the United Nations for World Evangelical Alliance and Clean Revolution Ambassador, also called for concerted leadership from faith communities: “The challenges our world faces in mitigating climate change now requires uniting with an unprecedented global-community mindset. Some soul-searching is in order for faith based organizations and houses of worship who are abdicating our moral responsibility to our most vulnerable neighbors in the developing world when we don’t lead by example and refuse to tolerate any less from our business and government leaders on climate change. Sustainability for the “bottom billion” is not an option, it is a lifeline that we have the ability and obligation to provide if we really believe in “loving our neighbors as ourselves.”

Governments back call for scale-up

Scotland’s Environment and Climate Change Minister, Paul Wheelhouse, said: “Climate change is happening across all continents. It is contributing to heatwaves, drought, storms and flooding across the globe. And it is hitting hardest the poorest and the most vulnerable in the least developed nations – those who have done least to create the problem. In acknowledgement of this, Scotland is championing Climate Justice, putting people and human rights at the heart of action on climate change. The case for global action is compelling, which is why the Scottish Government, with unanimous support from the Scottish Parliament and the support of civic Scotland, has set world-leading, annual greenhouse gas emission reduction targets. This is also why we have published detailed plans on how to meet our target to reduce Scotland's emissions by 42% by 2020, as Scotland's contribution to international efforts to restrict global temperature increase to 2°C.

“Scotland’s climate change targets are challenging. The warnings from the IPCC emphasise that they should be, and the global community needs the rest of the UK, our European neighbors, and indeed all countries to share our commitment to averting damaging global temperature increases, through agreeing, in 2015, an ambitious global deal to dramatically reduce greenhouse gas emissions.”

South Australia’s Minister for Sustainability, Environment and Conservation Ian Hunter said climate change was having an impact on both the local economy and lifestyle: “In just 90 days across 2013-14, we had over 156 records broken around Australia, including the driest January on record and five days in a row over 42°C in South Australia.”

“The Government of South Australia accepts the IPCC’s clear message that we must take rapid action, and transition to a low carbon economy. I believe the release of the next installment of the IPCCs comprehensive review of global climate science will only increase our commitment to making this transition. South Australia has already committed through legislation to reduce greenhouse gas emissions by at least 60% of 1990 levels by 2050 as part of our response to climate change. In 2010-11, South Australian emissions were almost 9% lower than 1990 levels, and South Australian targets for renewable energy are 33% by 2020.

“We are proud that more than 27% of our electricity generation now comes from over US$3 billion worth of privately-funded wind farms with an additional 4% from solar panels. South Australia understands the importance of reducing emissions, but we also need to be proactive in adapting to the changes that have already occurred.”

Welsh Minister for Natural Resources, Alun Davies said: “This latest IPCC report reinforces the need for us to accelerate action on climate change and underlines the economic, business, social and environmental reasons for doing so.

“Wales is a progressive sub-national government and we have already been working hard to reduce our emissions and prepare for a changing climate. We are also committed to driving forward green growth which presents us with tremendous opportunities. We have a good story to tell in terms of action and innovation on climate change but we are focussed on increasing our efforts and doing more.

“We are currently legislating to make sustainable development our central organizing principle though our Future Generations Bill, refreshing our climate change policy to accelerate our progress and support green growth and legislating for sustainable natural resource management through our Environment Bill. Working to meet the challenge of climate change presents us with opportunities to improve our resilience and ensure the long term prosperity of our nation and we are keen to collaborate with others to achieve this and to share our experiences with others.”

Business perspective

Stephanie Pfeifer, Chief Executive of the Institutional Investors Group on Climate Change, which represents 91 European investors worth €7.5 trillion, says: “The IPCC reports leave no doubt that climate change will have significant social and economic consequences unless substantial emissions reductions are achieved. This requires a significant scaling up of investment in low-carbon energy. The most effective way to stimulate this investment is through the implementation of ambitious policies which create incentives to invest in low-carbon technologies and reduce incentives to invest in fossil fuel energies. The longer investors wait for strong regional and global climate policy which could drive the transition to a low-carbon economy, the greater the risk of climate change which would inflict serious economic losses. By taking action now, policymakers can put the world on a low-carbon growth path."

Mark Way, Head Sustainability Americas, Swiss Re, says: "We are facing an ever starker choice between two visions of the not so distant future, both of which will transform society as we know it today. From a risk management and business development perspective we need to finally take on board what the IPCC is telling us. The transition to a low carbon future is the only sensible choice."

Ottmar Edenhofer, Co-Chair IPCC Working Group III, will be delivering a keynote address at The Climate Group’s 10 year anniversary event, Low Carbon Growth and Opportunity: Paris and Beyond in London on 28 April.

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*Figures correct at time of writing, based on PwC research