High-Level Expert Group Meeting
29-30 April 1989
Montreal, Canada
Chaired by Pierre Elliott Trudeau
1. Global warming is with us. If present trends continue
unchecked, rapid and continuous shifts in climate -
including possible droughts in mid-continents and
increases in frequency and intensity of tropical
hurricanes - accompanied by increases in sea-level will
occur over the next decades. These changes are bound to
endanger the well-being, perhaps the survival of humanity
as well as the security and physical integrity of entire
countries - and they are already beginning to create
anxiety among the people in many countries. While all
scientific phenomena may not yet be fully understood, the
long lead time for remedial measures to show effects calls
for immediate action by all countries, individually and
collectively. The world cannot afford the risk of being
complacent: no country will be able to escape the risks of
global warming. The cost of inaction now will become
staggering a few years hence triggering political tensions
and conflicts hitherto unknown.
2. The greenhouse effect - the increasing accumulation of
a variety of gases in the atmosphere which trap heat and
reflect it back to the earth' surface - is the principal
cause of the evolving global climate change. Carbon
dioxide (C02) alone accounts for more than half of the gas
build-up - largely caused by energy consumption patterns
and by deforestation. Other gases, including methane,
nitrous oxide, chlorofluorocarbons (CFC) and tropospheric
ozone are responsible for the remainder. The present
pattern of use of fossil fuels is also responsible for
local air pollution and acid deposition. CFCs are
responsible for destruction of stratospheric ozone.
3. Energy is basic to any economic growth and developing
countries, in particular must pursue economic growth
policies to develop. Population growth, especially in the
third world, the quest to raise standards of living, an
expansion in economic activity and wasteful attitudes in
energy consumption will be key determinants for future
energy demand. Although the experience of OECD countries
suggests that growth in GNP is not necessarily coupled to
similar growth rates in energy demand, all scenarios about
energy requirements until well into the next century -
despite their differences - agree that considerable
increases in fossil fuel use will happen unless effective
corrective action is taken (for examples see appendix).
4. All Governments must therefore adopt the stabilization
of the composition of the atmosphere as an imperative
universal goal. A reduction in emissons of C02 will be
critical to reach such a goal and there is general
agreement that a scientific and technical solution to the
C02 problem is possible given the political will to
initiate and manage the process. Various proposals call
for the adoption of benchmarks for CO2 emission reductions
within specific timeframes. The 1988 Toronto Conference on
Global Climate Change, for example, called for a global
reduction of emissions by 20 % by the year 2005. However,
most experts consider such a reduction as insufficient to
stop global warming. To this end, a much higher reduction
target would be more appropriate. Accordingly, other
targets suggest more significant C02 reductions to produce
a stabilization of the C02 content of the atmosphere at
the 1985 level within a decade. Such a step would require
a major global shift away from fossil fuels starting
immediately. Given their past pattern of energy use,
industrialized countries have a special obligation to
decrease their CO2 emissions drastically to show the way
for the transition period.
5. Targets must be adopted as an initial point of
departure by the national parliaments of OECD countries,
the OECD and IEA, the summits of the industrialized
countries, the European Communities, the Council for
Mutual Economic Assistance, the Movement of Non-Aligned
Countries, the Organization of African Unity, the ASEAN
countries, the Organization of American States and other
similar groups. In the age of interdependence, all leaders
have a political and moral obligation to go beyond a
verbal commitment to these targets so as to avoid
encumbering future generations with the consequences of
global warming. The public expects them to be more
specific as to the policies required to reach those
quantitative reductions and to launch and manage the
necessary action. The industrialized countries must
immediately take the lead in order to induce complementary
action by the developing countries. A safe and sustainable
energy future must rely on new thinking and new approaches
in all countries. Thus, special advocacy and education
campaigns will have to reach out, with the support of the
media, to all strata of society.
6. Developing countries have a special responsibility to
adopt vigorous plans to control population growth. An
unabated population explosion coupled with anticipated
economic growth will substantially increase energy demand
worldwide cancelling out any savings accomplished in
developed countries. As most of the energy needs of
developing countries are satisfied at present through
deforestation and the use of fossil fuels, the detrimental
impact on global climate is inevitable.
7. To foster openness and accountability and to stimulate
public pressure, the International Energy Agency should
incorporate in its annual reviews of the energy policies
of member countries a system of monitoring performances in
reducing C02 emissions and in the effectiveness of
relevant policy measures. Such systems should subsequently
be established for other regions, and eventually be
consolidated within the framework of the United
Nations.
8. An effective CO2 abatement strategy must comprise a mix
of short, medium and long-term policies, to be adopted by
all countries, in order to realize any agreed target.
- In the short term, conservation and increases in the efficiency of energy use (demand) and production (supply) must become the cutting edge of national energy and environmental policies.
- In the medium-term, a shift in the fossil fuel mix from coal and oil to gas, taking advantage of their different carbon contents, will help to reduce CO2 emissions.
- In the long-term, there must be a massive promotion and aggressive introduction of renewable sources of energy on a large scale.
9. Time, capital and institutional innovations will be
critical determinants for the policies of transition
toward a new energy era. There can be no universally
applicable prescription to accomplish a decreasing use of
fossil fuels. Each country must make its own choice, but
it must contribute - individually, regionally and
globally.
10. Prices have proved to be an effective tool in
influencing energy consumption. Between 1973-1985, high
energy prices drove the significant gains made by most
OECD countries in energy productivity. In the medium term,
the price-elasticity of demand for all energy sources has
been substantial. To help bring about the desired
reduction in the demand for fossil fuels, Governments
should therefore introduce "conservation pricing" of
energy (as recommended by the World Commission on
Environment and Development), reflecting external costs to
the environment. This could be accomplished through a
well-devised system of subsidies, taxes, levies and
incentives although public opinion must be convinced that
such instruments are appropriate for the purpose. All or
part of the revenues obtained could be earmarked for the
support of policies by developing countries in the energy
sector (see para. 36 below).
a) Levies could stabilize relative energy prices or, at
least, prevent a decline, although the level and technical
feasibility of each levy would have to be established;
b) Levies could deliberately increase relative energy
prices or, at least, the prices of fuels with CO2
emissions in order to induce steady annual gains in energy
productivity or switches to other energy carriers. (The
global target for energy productivity improvement should
be at least comparable to the rate of global economic
growth so that overall energy use would stay roughly
constant. Industrialized countries might have to attain a
higher target so as to reduce their currently high per
capita levels of energy use.)
c) In the present structure of energy subsidies,
incentives for the use of fossil fuels should be removed
and incentives to accelerate the coming on stream of bio-
and renewable energy technologies should be introduced.
11. Massive research and development (R&D) programmes
need to be funded by governments and the private sector in
all areas of energy use and supply, ranging from
improvements in energy efficiency and the efficiency of
end-use technologies, to the development of new and
renewable sources of energy and, where applicable, to the
problems of the safety, waste disposal and
diversion-resistance of nuclear power technology. Research
should equally be accelerated in order to gain a better
understanding of the processes underlying climatic
change.
12. International agreements and assistance may help
accelerate the overall process. Thus, all nations should
immediately start negotiations leading to the early
adoption of a global convention on the global warming
issue. Such a convention should, among others, provide
for
a) A control of the emissions of all greenhouse gases;
b) Agreed levies on the carbon content of all carbon
fuels;
c) The establishment of an international fund to support
developing countries with measures to prevent and adapt to
the consequences of global warming (see para. 36 below);
and
d) The formal creation of a global monitoring system (see
para. 7 above).
13. Energy policies must henceforth be harmonized with
environmental objectives and concerns, fully integrated
into the overall decision-making process of a nation and
oriented towards sustainable development. Human and
natural resources should be able to support the
development and welfare of the world's people now and in
future. In that respect, the United Nations should build
on the 1972 Stockholm Declaration and elaborate a code for
the protection of the environment defining each nation's
responsibilities and rights in preserving and improving
the global environment.
14. If the proposed policies are implemented, consumption
and production patterns will change and may have a
positive impact on global quality of life, changing in the
process our culture. Even if the greenhouse effect should
turn out to be less dramatic in its consequences than
currently predicted, a better global energy structure
would have emerged, leaving more room for decisions by
future generations.
*******
ENERGY EFFICIENCY AND CONSERVATION
15. In the short run, energy efficiency and conservation
measures will be crucial in reducing demand for and supply
of fossil fuels and, thus, their emissions. In the 1970s
and 1980s, the OECD countries pursued conservation in a
quest for energy security without regard to environmental
issues. In the future, increased use efficiency,
conservation and energy waste reduction by all countries
will hold a significant potential for reducing energy
demand - and thereby C02 emissions. Moreover,
energy-saving technologies and efficiency policies can
bring about real economic benefits and help to preserve
the limited and increasingly costly fossil fuels for
alternative uses, e.g. in chemistry, and for use by future
generations. While small by themselves, energy use
improvements can cumulatively help maintain globally
current levels of energy consumption for several decades
without impinging on the economic growth prospects of
nations. In their research and investment policies,
regulatory and other efforts, countries should therefore
accord top priority to energy efficiency improvements and
the development of environmentally sound technologies. As
energy efficiencies in various industries, transportation
and home use vary from country to country by a factor 3,
there is a potential for greater global reduction if a
mechanism can be devised for the transfer of advanced
technologies.
16. Regulatory policies, in particular, should be modified
to mandate a steady improvement in the efficiency of
energy use appliances, lighting, transportation and
production technologies. Governments should be encouraged
to take unilateral measures following the commendable lead
taken by Sweden or the Southern California region.
17. Specific practical measures could be:
a) Mandatory thermostat adjustments for public and
government buildings;
b) Expansion of public transport systems and promotion of
ride-share arrangements;
c) Co-operative global targets for increases in automotive
fuel economy (to the range 40-50 miles per gallon (mpg) by
the year 2000 and 80-100 mpg by 2010), to be agreed upon
by the auto industry (this would also reduce the pollutant
tropospheric ozone);
d) Reduction in paper use and increased recycling of waste
paper;
e) Increased bio-control schemes to reduce the use of
pesticides.
18. Price and non-price incentives need to be devised
which will encourage conservation across the board and
nurture the development of an industry that sells energy
services. The price of each energy source must reflect its
full production costs (including, to the extent possible,
environmental costs). Subsidies stimulating energy use
must be eliminated in order to induce efficiency. In
preparing for 1992, the countries of the European
Community will bear a special responsibility in that
regard.
19. While initial savings from efficiency and conservation
measures may be considerable, the problem becomes more
complex in the long run, when substantial shares of energy
will have to be saved. How much can reasonably be saved
and what is a reasonable level?
20. On the supply side, adequate technologies should be
developed to reduce the fossil fuel components, especially
in the generation of electricity, where promising
opportunities for improving efficiency in fuel-based power
generators involve shifting from steam to gas turbines.
21. At the national level, the establishment of a new
mechanism bringing together the private sector, labour,
governments and environmental groups may foster the
emergence of new strategies and stimulate innovative
corporate responses to the problem.
ADJUSTMENTS IN THE ENERGY SUPPLY MIX
22. If the use of fossil fuels is to be significantly
reduced, savings and gains in energy efficiency alone will
not suffice. New and cleaner ways of producing energy will
have to be developed on the supply side. Each country will
have to tailor its own solution in the light of its
specific circumstances. The available options are:
a) A substitution between hydrocarbons toward the use of
fossil fuels with a lower carbon content (more gas for oil
and coal);
b) The development and introduction of renewable energy
resources, such as biomass and solar, to substitute for
hydrocarbons;
c) The use of nuclear energy.
23. In the medium term, a shift in the fossil fuel mix
from coal and oil to gas should be encouraged, because gas
emits 43% less C02 per unit energy produced than coal.
Further, gas installations are usually considerably more
efficient and burning gas emits almost no sulfur dioxide
and, thus, creates less acid rain. There is an enormous
potential of natural gas to be tapped in centrally planned
economies, in Europe, the Middle and Far East and North
America. It takes, however, time to build the expensive
infrastructure including necessary transport
facilities.
24. In developing countries and in some developed
countries, there is a strong momentum to use more fossil
fuel products. The announced plans of developing countries
like China and India to expand greatly the number of their
coal power plants causes concern as their emissions would
offset any savings in CO2 emissions by other countries.
National interests and the global dangers associated with
a growing greenhouse effect must be reconciled and
developing countries should be vigorously assisted in
finding ways to do so.
25. The nuclear option will remain a part of the picture.
Nuclear energy is one of those energies which avoids C02
emissions. It is one of the most advanced, industrialized
of all energies, but is also seen as inefficient and
uneconomic if one includes the cost of permanent disposal
of spent fuel rods and decommissioning of plants. Because
of its high risks and proliferation potential, it cannot
be considered as the solution to the climate warming
problem. On the other hand, a shut-off of nuclear reactors
would at present lead to increased use of coal and gas.
26. Decisions about nuclear energy must rest with each
individual country. Given widespread public opposition,
however, there are currently no new nuclear plants in the
pipeline. Owing to the cross-frontier risks of nuclear
power generation, more effective internationally binding
rules and regulations governing the management of nuclear
energy and standards of operation will have to be
developed and made mandatory.
27. The establishment of nuclear energy centers may offer
a practical solution, also in view of the
non-proliferation aspects. In general, more research funds
may have to be allocated to scrutinize more intensively
safety and waste disposal problems and to explore the
potential of nuclear fusion and superconductivity.
28. The least cost option should be the guiding principle
for all decisions comparing costs of actions on the demand
side with the different options for supply - with a full
reflection of environmental costs. In institutional terms,
the energy sector, which is vertically organized in strong
competition (i.e. oil, gas, coal and nuclear power), may
have to be re-organized into horizontal industries so as
to market energy services to satisfy end-uses on a
least-cost basis. The private sector in OECD countries
will have to play a major role in the transition period,
in particular in developing technological solutions and
initiating joint ventures with Eastern European and
developing countries.
THE NEED FOR RAPID EXPANSION OF RENEWABLE
ENERGIES
29. In order to stabilize the present composition of the
atmosphere and subsequently reduce C02 and other
greenhouse gases, there must be a policy commitment to the
rapid development and deployment of renewable energy
resources such as biomass, photovoltaics, winds,
hydroelectric and others in lieu of fossil fuels. Hydrogen
as a new clean fuel should also be promoted as a secondary
fuel. In the long run, these energies represent the best
hope for a safe and secure energy supply. They have a
particular potential for developing countries if used
efficiently and for urban areas with big pollution
problems. Certain types of renewable energies, however,
may not be apt for certain countries. e.g. biomass
dependent on sufficient water supplies is unlikely to
succeed in arid countries.
30. Substantially increased research and development is
urgently required to develop renewables in all countries
and to achieve a quantum leap. The private sector will
have to play a special role. The initial focus should be
on bioenergy - both biomass production and bioenergy
conversion-technology and science. In developing
countries, particular attention should be paid to the
development of substitutes for fuelwood to slow down
deforestation. The supply of inexpensive cooking stoves
will decrease by several times the amount of wood now used
for cooking on open fires.
31. It should be borne in mind, however, that the
large-scale uses of biomass and other renewables will have
an impact on land-use patterns, life style and
innovations, that is, ultimately, culture.
THE CHALLENGE IN DEVELOPING COUNTRIES
32. Developing countries are trapped in the traditional
paradigm that GNP growth must lead to energy growth. This
has led to a pattern of consumption and growth that
aggravates the greenhouse effect and is ecologically
unsustainable. If adjustments are requested on account of
global warming, developing countries may interpret this as
an effort to impede their development. This
greenhouse-development dilemma must be overcome through a
new approach. Energy services must replace energy
consumption as a true indicator of development with
priority assigned to energy services for basic needs on an
incremental least-cost basis.
33. In developing countries "technological leapfrogging"
of the present pattern of development should be promoted.
To this end:
a) Energy efficiency should be made a major design feature
of development planning and become a decision factor for
all investments in new plant and equipment and should not
only be limited to "retrofitting" of existing
capacities.
b) Bilateral and multilateral development assistance
agencies should reorient their approaches and eliminate
any bias against investment in new technologies in spite
of powerful commercial and institutional vested interests
that may push "wrong" technologies for energy supply,
industry, agriculture and transport not scrutinized under
the least-cost approach. Loans for energy projects should
only be approved if they demonstrably will not cause undue
environmental damage beyond the project completion period.
Furthermore, the international financial institutions
should begin to support energy-saving ventures from the
demand side instead of concentrating exclusively on the
energy supply projects.
c) R & D centers should be established in developing
countries to promote energy-intensive basic industries to
serve as "engines of growth" during the period of
infrastructure-building (e.g. in the steel, cement,
fertilizer, and glass industries).
34. As most options, including the introduction of
renewable energy sources will have to be purchased or
developed and will therefore require capital, this will be
a major constraint for the developing countries,
especially the highly indebted ones.
35. Within the framework of the United Nations, a
tripartite commission comprising OECD, the Council for
Mutual Economic Assistance (CMEA) and developing countries
should be established to study and recommend co-operation
measures to enable developing countries to implement CO2
-reducing policies.
36. There is a strong case for the establishment of an
international fund to finance domestic and international
programs designed to promote an efficient energy future
and the transition to a stable climate. This fund could be
financed both from the proceeds of a national or an
international system of greenhouse gas (particularly CO2)
emission levies (see para. 10 above) and from direct
Government contributions. The recent decision of the
Government of the Netherlands to pledge unilaterally funds
for action by developing countries to stabilize the global
climate is most encouraging and should be emulated by many
other industrialized countries. Alternatively, countries
could be asked to make contributions in accordance with
their annual CO2 emissions which are known (see para. 7).
Developing countries should use the available resources:
to obtain specialized technology for environmental risk
reduction; to accelerate the transfer of energy efficient
methods for their industries; to stimulate the development
of new needs-oriented technologies with a view to
promoting environmentally sustainable development and
energy efficiency, halting deforestation and facilitating
the transition to energy paths without excessive reliance
on fossil fuel use.
37. In developing countries, there is need for the
emergence of credible non-governmental organizations
(NGOs) which could increase internal pressure on
decision-makers to take into account their global
responsibilities. In most cases, external pressures
through donor governments, agencies and international NGOs
are already applied but they may not have the same impact
as that from domestic organizations. New mechanisms or
prizes may have to be established so as to confer
recognition to heads of state adopting policies to counter
global warming trends. Such symbolic acts may be
particularly important in situations where a country has
sacrificed its immediate welfare for global interests and
where international commendation may bolster further
leadership and resolve.
OTHER MEASURES TO COMBAT GLOBAL WARMING
38. Intensified research must urgently be undertaken into
possibilities to reduce the emissions of other greenhouse
gases besides CO2, namely methane, nitrous oxide, CFC's or
their substitutes, tropospheric ozone (a pollution
product).
39. A determined global effort is required to stop
deforestation and the decline of forests in all continents
- tropical and temperate countries alike - and to launch
effective and large-scale programmes of afforestation and
reforestation which will help to recapture CO2 from the
atmosphere, to prevent soil erosion, to improve the soil
water balance and to preserve species. All such programmes
should seek to work with communities in order to ensure
greater success than has been recorded by experts who
endeavoured to re-afforest countries for or on behalf of
the natives. One additional intriguing feature of new
forests would be that they would open the way to efficient
methods of biomass burning for electricity generation,
such as gasification and the use of aeroderivative gas
turbines. The InterAction Council, in 1988 made detailed
proposals on this issue and the urgency of their
implementation is again underlined.
APPENDIX
I. Facts and figures
- The total consumption in primary energy consumption will have more than doubled by the year 2000 even if present growth rates in consumption are only slightly reduced.
- The overall growth in energy consumption averaged 2.85 per cent per annum since 1968. The pattern of growth was much faster prior to 1974 (4.47 per cent), followed by relatively slow growth until 1984 (1.97 per cent) and a strengthened growth since then (2.59 per cent).
Average Annual Growth Rates in Primary Energy
(Per cent)
1968-74 1974-84
1984-87 1987-2000
OECD 3.57
0.47 1.40
1.40
CPEs 6.62
3.22 3.59
2.89
DCs 6.52
5.73 4.23
3.74
World 4.47
1.97 2.59
2.34
- The worldwide consumption of oil has fallen over the last ten years both in absolute and relative terms - while the shares of other fuels have steadily increased worldwide with coal and nuclear taking the major part of this increase.
- During 1974-1984 there was negative annual growth (-1.45 per cent) in oil consumption by OECD countries.
- With the fall in oil prices since 1984 consumption has picked up again in OECD countries, but growth has continued to decline in developing countries.
Distribution of oil Consumption by region
(per cent)
1968
1974 1984 1987 2000
OECD 71.1
66.9 57.0
56.4 52.5
CPEs 15.6
18.9 23.1
23.1 22.9
LDCs 13.3
14.1 19.1
20.5 24.6
World 100.0 100.0
100.0 100.0 100.0
- Over the past several years, nuclear energy consumption grew at more than 10 per cent annually, and accounts now for 8.45 per cent consumed in OECD countries.
- The centrally planned economies (including China) realized both a decrease in oil and coal consumption, due to the increase in natural gas (now 23 per cent) and nuclear energy.
- In China, coal grew to take a larger share and natural gas was reduced.
- In the developing world, non-commercial sources (fuelwood) make for an important contribution and are also the cause of environmental degradation. While no authoritative statistics exist for this sector, it is estimated that these fuels account for more than 10 per cent of world primary energy consumption.
- On the basis of present trends, coal consumption will grow at 3 per cent annually, i.e. the world will consume 86 per cent more coal by the year 2000 than it did in 1977. More than two-thirds of the consumption will take place in developing countries and centrally planned economies.
- In the past, a population growth of 2% was associated with an increase of 3 per cent in energy consumption per capita.
- The industrialized countries - a mere 1/6 of the world population - account for 50% of the total world consumption, while the developing countries - 2/3 of the world population - consume 1/6 of total energy.
- If present trends continue, the concentration of CO2 in the atmosphere would double by the year 2065. With the simultaneous increase in other greenhouse gases, the effective doubling date will be 2030.
II. Pattern of Consumption
Relative Shares of Various Energy Sources
(in per cent)