Cameron Hepburn

26 October 2006

Financial Times – Climate change also brings opportunities

Cameron Hepburn

There are two ways to look at the expenditure that will be required if the world is to make a serious attempt to curb global warming.

As always in the analysis of climate change, there are enormous uncertainties, both about the science and the economics. But calculations set out in a report from Shell Springboard, Royal Dutch Shell’s environmental awards scheme for small and medium businesses, give some rough idea of the scale of both the challenge and the opportunity.

Sir Nicholas Stern, head of the government’s review of climate change, has argued that a concentration of carbon dioxide and other greenhouse gases in the atmosphere of 550 parts per million by the middle of the century would be “potentially dangerous territory”. On unchanged policies, it seems likely that greenhouse gas levels will rise well beyond that level.

Cameron Hepburn, an energy economist at Oxford University who worked on the Shell Springboard report, says: “Technological change tends to be disruptive to business models, and climate change will be a disruptive influence, creating danger for incumbents and opportunities for new entrants.”