accounting for carbon in copenhagen | morten hojer

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Accounting for Carbon in Copenhagen

ICARB Conference, EdinburghSeptember 5 2014

Morten HojerClimate Unit, City of Copenhagen

London School of Economics launched report on Copenhagen as a ”green economy leader” in June 2014

2Source: LSE, Economics of Green Cities Programme (2011-2015).

Is there is an economic rationale for early action on ”green” growth in cities?

The intellectual foundation of the LSE report spans across a diversity of fields (1/3)

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1990

1995

2001

2007

2013

The Stern Review (2006) argued that the benefits of strong, early action on climate change outweigh the costs:

Without action, overall costs of climate change are equvalent to 5%-20% of world GDP each year

The impacts are irreversible and unevenly distributed; poor people in less developed countries are likely to suffer most

To avoid the worst effects of climate change about 2% of world GDP needs to be invested

From science… … to economics

The intellectual foundation of the LSE report spans across a diversity of fields (2/3)

42011

“Cities are actually the healthiest, greenest, and richest places to live. New Yorkers, for instance, live longer than other Americans; heart disease and cancer rates are lower in Gotham than in the nation as a whole. More than half of America’s income is earned in twenty-two metropolitan areas. And city dwellers use, on average, 40 percent less energy than suburbanites.”

New York Times Review of Books

…to economics of urban agglomeration

The intellectual foundation of the LSE report spans across a diversity of fields (3/3)

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… to a new ”industrial” revolution

The state of the debate

6Source: The Global Commission on the Economy and Climate, New Climate Economy project.

NeutralGrowth and climate have

tradeoffs

Growth and climate have co-benefits

▪ Growth model too fragile to take on climate action now

▪ High energy costs will kill growth and create competitive asymmetries

▪ Climate action puts an unfair burden on the developing world

▪ There are multiple factors which affect growth in the next 3-5-10 years which are more important than climate action (which is frankly second-order)

▪ Higher resource efficiency can lead to better short-term growth/less volatility

▪ There are major co-benefits (air quality)

▪ Cleantech is an enormous innovation driver that will spillover positively to the whole economy

Energieffektivitet i byggeriet:xxx

What is Copenhagen doing about it?

Over the past 20 years, Copenhagen’s economy grew by 25% while simultaneously reducing GHG emissions by 40%

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Urban crisis and de-population followed by inner-city densification

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Despite a low average population density, housing and employment areas have been planned with good accessibility

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Low levels of vehicle ownership per capita

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Low time costs of journey-to-work indicate a very effective urban transport network

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Energieffektivitet i byggeriet:xxx

Copenhagen carbon neutral by 2025

There are big challenges…

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• Carbon: From 20 pct to 100 pct reduction in 10 years • Population: +20 pct increase in 2025 • Housing: +25.000 new units• Office spaces: +2,8 mio. m2

… and opportunities

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Potential emissions reductions of 1,2 mio. tons of CO2e have been identified…

Green mobility

Total

City administration

Energyconsumption

Energy production

▪ Biomass-based combined heat and power▪ Land and offshore wind turbines▪ Separation of plastics from waste

▪ Energy retrofitting of existing buildings▪ Low-energy new build▪ Solar PV

▪ City of Cyclists▪ Alternative fuel vehicles (electric, hydrogen)▪ Biogas and hybrid busses▪ Intelligent traffic systems (ITS)

▪ Energy efficiency in own buildings▪ New fuels in municipal vehicle fleet▪ LED street lights

Selected initiatives

New initiatives▪ New initiatives at EU-level (energy, renewables, transport)▪ New initiatives at national level (energy, transport)▪ New initiatives at city-level (construction, transport)

0,9

Million tCO2e per year

0,1

0,1

0,1

1,2

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… that require massive investments in Copenhagen 2013-2025

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Public InvestmentsCity of Copenhagen0,4 bn€

Private InvestmentsDirect Investments3,25 bn€

Private InvestmentsEnergy and Climate Investments32,8 bn€

985

On the day the ”green economy” finally arrives

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Thank you for your attention

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MORTEN HOJERSpecial Advisor onClimate and Green Growth(+45) 23 39 34 43morten.hojer@tmf.kk.dk

www.kk.dk/climate and www.kk.dk/english