Governments forced to rescue the world’s banking system are being warned there will be no bailout if there is a crisis in the Earth’s climate system.
That is the view of the head of the Organisation for Economic Co-operation and Development (OECD).
Angel Gurria is expected to rebuke nations failing to curb CO2 emissions in a speech on Wednesday.
He will say the analysis of the climate threat is far clearer than were the warning signs for the financial crisis.
Mr Gurria is due to address the topic of climate change, investment and energy policies in a London lecture co-organised with the London School of Economics and the Climate Markets & Investors Association (CMIA)
Scale of risk
The talk coincides with a report in The Independent newspaper that claims UK Chancellor George Osborne is about to reject the recommendations of government advisers by slowing the drive to tackle global warming.
In his speech, Mr Gurria will ask if leaders overseeing the financial system that led to the “train wreck” of the banking crisis would have been happy to take the risks if they had known the consequences.
Unlike the financial crisis, we do not have a ‘climate bailout option’ up our sleeves,” he will say.
And despite all the attention given to climate change deniers, our understanding of the scale of the risk is much better developed than our understanding of the financial risks, pre-crisis.”
An OECD source said the secretary-general’s remarks were directed both at countries which had dragged their feet on reducing emissions and those which had taken a leadership position but were now starting to wobble.
Asked if the latter group included the UK, where the chancellor argued last week that Britain “should not be in front of the rest of the world” in tackling climate change, the source said the OECD was fully aware of the situation in Britain and all its member states.
Mr Gurria will also warn that renewable technologies will be harmed by stop-start policies. Renewables firms in the UK have benefited from a stable policy framework in the medium term, but are uncertain about long-term investments as right-wing Conservatives attempt to abandon CO2 targets for 2030, arguing that they damage competitiveness.
He also takes a swipe at fossil fuel subsidies, currently estimated at over $500bn a year globally. These typically provide cheap motoring for the rich, he says, and fail to help the poor.
The world, he says, needs to become zero-carbon in the second half of the century, and needs to start on that pathway immediately if climate change is to be stabilised.
Mr Gurria, like the UN Secretary-General Ban Ki-moon last week, is trying to galvanise action for an ambitious agreement in the planned 2015 UN climate conference in Paris.
Rich nation governments struggling against recession have been going slow on climate change policies, and developing nations have argued that they need space to expand emissions to grow their economies and draw people out of poverty.
Mr Gurria will argue that creating an infrastructure that leaves people dependent on fossil fuels will prove more costly overall in terms of the economy and public welfare.
Interviewed on BBC Radio 4’s Today Programme, he said: “Countries like Britain have been leading the charge (on climate change) and have to continue to do that. It’s because of leadership of UK that EU has seen that this is the way to go – and the rest of the world too.”
He said energy policy has become extra challenging following technology improvements on exploiting fossil fuels. “We grew up with scarcity of oil and fuel, now we are entering a world of abundance so we’re really going to have to think very hard on this.”
The OECD is to publish a paper on the most effective ways of managing carbon cuts in the economy.
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