1. Global energy use: economic necessity, development opportunity or environmental disaster? Dr. Julia K. Steinberger IFF/Social ecology, Vienna

2. Steinberger | IHEID | April 7th 2009 | 2 Outline 1.Global energy: what we use, how much, and what for? 2.Fossil fuels and climate change 3.Distribution and implications for development 4.Energy reductions: implications for the economy Links with growth The rebound effect 5.Urbanization and the importance of infrastructure 6.Some conclusions

3. Steinberger | IHEID | April 7th 2009 | 3 Globally, where are we now? From: IEA key world energy statistics 2008 (1 EJ = 10 18 Joule = 24 Mtoe) 490 EJ 136 million GWh

4. Steinberger | IHEID | April 7th 2009 | 4 Composition of global primary energy Fossils account for 80% of primary energy use. Renewables account for less than 15%, most of which is traditional biomass fuels in developing countries. Source: IEA key world energy statistics 2008

5. Oil

6. Steinberger | IHEID | April 7th 2009 | 6 Global energy used for transport (Exajoules) Data: IEA

7. How did we get here? Example of USA. Primary energy consumption in Gigajoule = 10 9 joule per capita.

8. King Coal

9. Steinberger | IHEID | April 7th 2009 | 9 Energy and losses for electricity production (Exajoules)

10. Global yearly emissions of fossil CO2 Source: CDIAC

11. Climate change in the past Source T. Stocker 2005 current level 380 ppm (Can extend graph to 850'000, T. Stocker 2006) Homo Sapiens appears Agriculture begins

12. Steinberger | IHEID | April 7th 2009 | 12 Climate necessity – energy solution? Reducing CO2 emissions requires two lines of action 1.Reducing consumption of fossil fuels (demand-side) 2.Increasing viable renewable production (supply-side) –Of these, fossil reduction is most important, but renewables often gets more attention (recently, biofuels). –Fossil fuels are 80% of our energy supply. Reducing fossil consumption means reducing energy consumption – by huge amounts. –And how much energy do we need to live well? Can we reduce our energy consumption? And how does this impact our economy?

13. Distribution and development Historically, developed countries are responsible for the vast majority of CO2 emissions which have accumulated in the atmosphere. The process of industrialization (so far) requires CO2 emissions from burning fossil fuels. Developing countries argue for their right to develop. Burden of mitigation should be on countries who already polluted the atmosphere – proportionally to their historic emissions.

14. Inequality in CO2 emissions Raupach et al 2007 Least Developed Countries Other Developing Countries Other Developed Countries

15. Displacement of United Kingdom CO2 emissions Wiedmann et al. 2008

16. Energy consumption between and within countries (from Spreng 2005) Top bar = top tenth percentile consumption Bottom bar = bottom tenth percentile consumption

17. Steinberger | IHEID | April 7th 2009 | 17 How much energy is required for a good life? Dakar, February 2007

18. Source: „Hungry Planet – What the World Eats“ Peter Menzel and Faith D‘Alusio Ecuador: The Ayme family of Tingo Food expenditure for one week: $31.55 Family recipe: Potato soup with cabbage Ecuador average: 2’700 kCal per capita per day

19. Germany: The Melander family of Bargteheide Germany average: 3‘400 kCal per capita per day Food expenditure for one week: 375.39 Euros Favorite foods: fried potatoes with onions, bacon and herring, fried noodles with eggs and cheese, pizza, vanilla pudding

20. Steinberger | IHEID | April 7th 2009 | 20 Human Development Index values and meanings 010.50.8 LowMediumHighHuman Development Source: Steinberger & Roberts 2008

21. Results: HDI vs. Energy Steinberger & Roberts 2008 2005 2000 1995 1990 1985 1980 1975 HDI Energy GJ/capita

22. Sustainability and development pathways Energy Steinberger & Roberts 2008

23. How does the energy threshold compare to global energy per capita? Steinberger & Roberts 2008

24. Global energy use Steinberger & Roberts 2008

25. Steinberger | IHEID | April 7th 2009 | 25 Yes we can? The challenge of energy reductions Energy and the economy –Growth –The rebound effect Infrastructure and urbanization as opportunities

26. Energy and the economy: international situation in 2000 Income in $ per capita Energy in GJ/cap

27. Steinberger | IHEID | April 7th 2009 | 27 Energy and the economy Economic growth is considered vital for industrialized societies – and even more for developing countries. Without economic growth, where would we get investment for social progress and environmentally-sound infrastructure and technologies? What would be necessary for decoupling economic growth and energy consumption? How can we get there?

28. Steinberger | IHEID | April 7th 2009 | 28 Some ideas on economic growth Classical and neo-classical view: –Economic growth is due to Labor and Capital: factors of production –Problem: over time, economic growth is always larger than can be explained by Labor and Capital. What is missing? –Resources: economy has a material basis! –Information, technology: innovation is good for growth Goal: find a model of economic growth that is robust over time, and takes into account resources and technology

29. 1.Primary energy as a factor of production Problem: primary energy is a raw material – we’re still missing technology! Result: economic growth is STILL higher than expected! 2.Useful energy as a factor of production: Useful energy tells us not only how much energy we’re using, but what we really get out of it: includes technology! Result: can model USA economic growth over 100 years. The energy chain: resource and efficiency

30. Useful energy explains USA economic growth over 100 years! Ayres et al 2007 Useful energy

31. Steinberger | IHEID | April 7th 2009 | 31 Conclusion from Ayres et al work The missing production factor can be almost entirely explained by useful energy. Economic growth both drives and benefits from progress in energy efficiency –Energy efficiency leads to economic growth. “The rebound effect is the engine of economic growth” - Bob Ayres Troubling questions: –Can efficiency really lead to decreases or decoupling, if it drives growth? –How can we ever deal with climate change without challenging the imperative for economic growth?

32. Steinberger | IHEID | April 7th 2009 | 32 Rebound effect Jevons Paradox, Brookes-Kazzoom postulate, boomerang or take-back effect Efficiency improvements => but energy savings are smaller than expected First described by Jevons, in “The Coal Question” (1865). He noticed that the introduction of Watt’s much more efficient steam engine led to a huge increase in coal consumption. Several types of rebound effect –Household: direct, income –Economy-wide: over product and energy prices William Stanley Jevons, 1835-1882

33. Steinberger | IHEID | April 7th 2009 | 33 “Income reallocation” rebound effect Spend money saved on energy intensive activity. –fly to Tenerife with money saved from driving a Smart car.

34. Steinberger | IHEID | April 7th 2009 | 34 Policy solutions to rebound effect Encourage low-energy intensity activities –Local travel and tourism, public transportation, smaller apartments, vegetarian diet, fewer electricity-using appliances Can be done trough a (large) carbon tax within a global climate change agreement –To avoid carbon leaks through trade. –Emissions limits within a development rights framework

35. Beyond the energy chain: infrastructure Steinberger, van Niel & Bourg, 2009

36. Steinberger | IHEID | April 7th 2009 | 36 Urbanization and energy Most final energy is already consumed in cities. Urbanization will be happening increasingly in developing countries. Urbanization can be seen as a development opportunity, and also as an energy-savings opportunity But only if forward-looking planning happens, in terms of overall regions. –Article p. 4 in Le Monde yesterday!

37. Urbanization and energy access: urban and rural energy in India, 1993-94 Pachauri 2004

38. Steinberger | IHEID | April 7th 2009 | 38 CO2 emissions from transportation in 10 cities Denver Toronto LA Barcelona Cape Town Prague London Geneva Bangkok NYC Kennedy, Steinberger et al 2009

39. Steinberger | IHEID | April 7th 2009 | 39 Sydney: private vehicle energy Lenzen et al 2004 GJ/cap

40. Steinberger | IHEID | April 7th 2009 | 40 Conclusions Global decent living standards and climate protection may be compatible. But attaining both or either of these requires large reductions in our energy use: not just individual, but infrastructure transformation. The economic consequences of lower energy use may not be so bad (transfer energy expenses to labor and technology), but might still result in lower growth rates.

41. Steinberger | IHEID | April 7th 2009 | 41 Thank you for your attention! Any questions?