The widespread adoption of carbon capture technology capable of catching and storing CO2 emitted from coal and gas fueled power stations will be essential if we are to successfully tackle climate change, according to a senior figure at the World Bank.
Speaking yesterday at a conference on financing low carbon technologies hosted by climate change research body the Tyndall Centre, Dr Robert Watson, chief scientist and director for environmentally and socially sustainable development at the World Bank, insisted that investment in green energy needed to focus more on improving the cleanliness and efficiency of fossil fuel-based power stations.
"Renewables are part of the solution," he said. "But because of the low price and [high] availability the US, China and India are going to use coal whether we like it or not, so we need to make it more efficient [to generate electricity from coal] and develop technologies that enable carbon capture."
Some delegates argued that carbon capture technologies would fail to deliver the level of energy security that countries could gain by shifting from fossil fuels to renewables. However, Dimitri Zenghelis, an economic advisor to the UK government and one of the authors of the Stern Review, agreed that carbon capture and sequestration must play a major role in any green energy policy.
"There are more than enough fossil fuels available to get us beyond the 750 parts per million [of CO2 in the atmosphere] level and a lot of those fossil fuels will be burnt because of their low marginal cost even in a world with carbon pricing," he said. "Therefore, carbon capture needs to play a major role."
Watson accepted there were still some technical problems with delivering carbon capture and sequestration, most notably in ensuring there are no future leaks from the stored carbon. But he argued governments needed to do more to stimulate investment in the technology.
He said that as carbon capture technologies would be for the public good with the main benefits being environmental rather than commercial there was a need for public-private partnerships to drive investment. "There is potential in the US and China to use this technology for several decades while we think about what to do next [to deliver clean energy]," he added.
Separately, Watson said that the investments required to deliver a clean energy revolution were relatively "trivial" - arguing that while we spend $1.25 trillion a year on oil some reports suggest that extra investment of just $40bn a year until 2050 could stabilise CO2 in the atmosphere at manageable levels. However, he warned that raising this investment would prove extremely challenging because "the current financing mechanisms are completely inadequate in both design and scale".
"A few windmills and solar panels just aren't going to cut it," he said. "We need a global, long term regulatory framework that recognises equity between developed and developing world economies. It can't just be Kyoto plus another five years."
Watson also claimed that a long term successor to Kyoto that delivered a global carbon trading scheme, could make it easier for the World Bank to expand its investments in clean energy projects in the developing world. He said that the World Bank had mapped out a model that would allow loans for green energy projects to be paid back at a low rate, because the investment fund could sell the carbon credits generated from the project.
He argued that this investment model was potentially sustainable, but was being hampered by the uncertainty surrounding the future of the UN's Clean Development Mechanism carbon emissions trading scheme post 2012, which has led to a decline in the price of carbon credits.
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