Experts warn of 'clean energy crunch'

A "clean energy crunch" may come hard on the heels of the credit crunch as the impact of recession hits attempts to hold back global warming, say experts.

A "clean energy crunch" may come hard on the heels of the credit crunch as the impact of recession hits attempts to hold back global warming, say experts.

World economic growth is no longer on track to avert the worst impact of climate change, according to new research.

Reduced carbon emissions due to lower economic activity will be outweighed by the negative effect of clean energy funding drying up, said a report from leading clean energy and carbon market analysts New Energy Finance (NEF).

Global investment in renewable energy sources, efficient energy use and carbon capture and storage, increased from $34bn (£24bn) in 2004 to around $150bn (£106bn) in both 2007 and 2008.

But the NEF Global Futures report said investment needed to reach $500bn (£355bn) in the next decade to ensure that carbon emissions peaked before 2020.

With the effects of the recession, funding was expected to fall well short of this target, said NEF.

Scientists fear if emissions continue to increase beyond 2020 there will be a strong risk of severe and irreversible climate change.

NEF's analysis predicts investment in clean energy to hold steady at about £106bn through the economic downturn and then to resume growing.

Total investment would reach $270bn (£192bn) by 2015 and $350bn (£250bn) by 2020.

At these spending levels, emissions were predicted to keep rising from 28 billion tonnes of carbon dioxide today to almost 36 billion tonnes by 2030.

In order to halt the growth of emissions before 2020, investment had to reach $370bn (£263bn) by 2015 and $500bn (£355bn) by 2020 - roughly equivalent to 0.44 per cent of the world's Gross Domestic Product. Emissions would then peak at 30.8 billion tonnes in 2019 and reduce to 29.1 billion tonnes by 2030.

 

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