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BP calls for global carbon price to avoid the "worst impacts of climate change"

Last year BP projected global climate pollution would "most likely" surge 26% by 2030. As I reported at the time, this would crank up the Earth's thermostat a disastrous +4C according to the International Energy Agency (IEA). That is twice the +2C threshold for "dangerous climate change" that all major nations have promised to stay below.

RELATED ARTICLE: Peak Oil solved, but climate will fry: BP report

This week BP delivered even worse news in their Sustainability Review 2013 report. If the world's nations continue muddling along with their slow and incremental changes to climate policies then the most likely result will be:

  • SURGING EMISSIONS -- BP expects global emissions to soar even higher and for longer than they projected last year. The new expectation is for a rise of 30% by 2035 (see chart above).  
  • DANGEROUS CLIMATE -- Preventing the "worst impacts of climate change" above +2C is looking "increasingly unlikely."
  • DIRTIER ENERGY -- Oil and gas will likely grow ever more climate damaging because "the GHG intensity of oil and gas extraction and production looks set to increase, with the move towards resources that are harder to access." They mention their projects in the Alberta oilsands as an example of the expansion into more climate-damaging sources of oil.
  • RENEWABLES LOSE GROUND -- The massive energy gap between renewables and fossil fuels will grow ever wider because humans are likely to choose fossil fuels for two-thirds of all new energy supplies.

Such clear evidence that the world is racing headlong into a serious climate crisis has apparently rattled even a super-major fossil fuel corporation like BP. In their new sustainability report they call for "global action" to set "effective" climate policies that include an economy-wide "carbon price":

"… limiting climate change will require substantial and sustained reductions of GHG emissions."

"The scale of this challenge is such that governments must act by setting a clear, stable and effective carbon policy framework …"

"We also believe that putting a price on carbon – one that treats all carbon equally, whether it comes out of a smokestack or a car exhaust – will make energy efficiency and conservation more attractive to businesses and individuals, and lower-carbon energy sources more cost competitive. A global carbon price should be the long-term goal, but regional and national approaches are a good first step, provided temporary financial relief is given to sectors that are exposed to international competition. "

Elsewhere in the report they point out that renewable energy will need a long-term carbon price to be competitive.

Here in BC we have an economy-wide price on carbon. And recent studies show that our version of it -- an income tax cut funded by a carbon pollution fee -- has successfully cut both income taxes and climate pollution without hurting the overall economy.

A simple price on carbon, like BC's Carbon Tax, has elements that could make it a preferred choice of many in a global climate solution:

  1. TRANSPARENCY: Transparency allows nations, citizens and businesses to evaluate if they are being treated fairly or not relative to others.
  2. PREDICTABLITY: Businesses and governments may prefer the stability and predictability of carbon pricing so they can plan farther out with more certainty.
  3. SIMPLICITY: The BC Carbon Tax was simple to implement and is simple to run. It took only a few months to set up and has almost no on-going overhead. In addition it is simple to comply with. It takes no extra effort for the vast majority of businesses and individuals to participate.  
  4. BIG FOSSIL AND FISCAL CONSERVATIVES TEND TO LIKE IT BEST: This is perhaps the biggest reason why a simple carbon price could be part of a global solution. For example, ExxonMobil has said that if there is going to be a climate policy then they strongly prefer a simple carbon tax. Without the buy-in from such powerful groups it seems unlikely that a climate policy can be adopted in time to prevent catastrophic climate changes.

Corporations like predictability and simple rules, so it doesn't surprise me that BP would prefer a simple price on carbon. Whether BP is worried enough about unchecked global warming to actually push for an effective carbon price in time will be interesting to watch.

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