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Energy-related emissions breakdown from Low Carbon Economy Index (

Climate Change

The Low Carbon Economy Index: Ambition And Reality

Leading world professional services firm PricewaterhouseCoopers released its sixth annual Low Carbon Economy Index report (Two Degrees Of Separation: Ambition and Reality), an analysis of economic growth rates and greenhouse gas emissions data for G20 economies), this morning.

Low Carbon Economy Index Pathway to 2 degrees (’s sustainability and climate change team says that not only are the world’s major economies not making progress in addressing the 2 degree goal—they are falling farther and farther behind.

With the Copenhagen agreement five years ago, almost 200 countries agreed at United Nations climate talks to adopt “the scientific view that the increase in global temperature should be below 2 degrees Celsius” (3.6 degrees F) above pre-industrial times, while growing world economies, to combat climate change. This would curtail increases in heat waves, floods, storms, and sea level rise due to natural and human-induced climate change.

Low Carbon Economy Index says we're heading to 4 degrees (

Low Carbon Economy Index says we’re heading to 4 degrees (via PwC). Click to enlarge.

At about 0.85 degrees C, we citizens of the world are now almost halfway there. The latest studies indicate that we may be approaching the serious risk of runaway climate change. In this report, PwC says that (1) we have missed the global carbon intensity (greenhouse gas emissions per $GDP) reduction target every year, and (2) we need to decrease energy-related carbon emissions by more than five times the rate we are currently achieving.

The Low Carbon Economy Index report reveals major disconnects between the global climate negotiations goal of a 2°C rise limit, current national pledges (which add up to a 3°C rise), and our current trajectory, which is actually on course for 4°C. (Disruption, released last night as’s leadup film to its  climate march in two weeks, sees us on track for 6°C.) Current rates of carbon intensity mean that we’ll reach the total amount of carbon the world can “safely” emit this century within 20 years.

The analysis describes as “unforgiving” the timeline to achieve what is now necessary in terms of carbon emissions reduction. Making up for the inadequacy of the past decade will be technologically harder, financially costlier, and climactically riskier in the future, Low Carbon Economy Index analysts say.

The researchers see some encouraging signs, though:

  • The E7 (China, India, Brazil, Mexico, Russia, Indonesia and Turkey) outperformed the G7 in carbon reduction (1.7% vs. 0.2%) for the first recorded time. The E7 perceives the business logic of green growth, indicating that nations can maintain economic growth while slowing the rate of growth in emissions.
  • Renewable electricity generation, excluding hydroelectricity, grew at 16%—a continuing trend for last decade with double-digit growth every year. Renewables now account for nearly 10% of total energy mix in six of the G20 economies. As they approach cost parity, the stage is set for a policy framework that shifts subsidies away from fossil fuels….

Other important results from the Low Carbon Economy Index:

Energy-related emissions breakdown from Low Carbon Economy Index ( countries—the UK, Italy, China, and Australia—decarbonized at a rate of between 4% and 5%.

  • The UK is now the most-improved G20 nation on carbon intensity and is also one of the world’s most energy-efficient economies.
  • China recorded one of the top performances for a developing country, with a 2013 decarbonization rate of 4%—a strong achievement, but tempered by that nation being the world’s largest carbon emitter, as well as highly carbon-intense overall.
  • Australia, a carbon enabler with its vast coal resources, recorded a 7.2% decarbonization rate, partly driven by a fall in energy demand against a growing economy, and partly by a 30% increase in hydroelectricity output.

Five countries increased their carbon intensity during 2013: France, US, India, Germany, Brazil.

  • Coal in the US has regained some market share from natural gas in power generation since its low in April 2012.
  • Transitioning away from nuclear to renewable power has caused Germany a short-term increase in fossil fuel use.
  • Brazil gets almost a third of its energy from hydropower, but droughts have forced the country to close the energy gap by importing liquefied natural gas.

From Jonathan Grant, director of sustainability and climate change for PwC:

“What we’ve seen over the past twelve months is a subtle change in the carbon rhetoric. The costs of climate inaction—from flooding to energy costs to commodity pricing, to food insecurity—appear to be growing stronger. A broader recognition is needed by both business and political leaders that taking decisive action to avoid the extremes of climate change is a precondition for sustained economic growth.”

About the UN’s most recent conclusions. According to the IPCC, levels of carbon dioxide (C02) are at their highest levels in 40 years. The IPCC has warned that our current trajectory will lead to a warming estimated to range from  3.7C°—4.8°C over the 21st century, with severe adverse impacts projected on people and ecosystems through water stress, food security threats, coastal inundation, extreme weather events, ecosystem shifts and species extinction on land and sea. At the higher levels of warming, many of these impacts are likely to be systemic, global, and irreversible.

About the Low Carbon Economy Index model. The LCEI considers energy-related carbon emissions, driven by a series of assumptions including the economic growth projections, primary energy intensity and fuel mix share. The model covers energy and macroeconomic data from individual G20 economies, as well as world totals.

Follow comments today @pwcclimateready. All graphics from Low Carbon Economy Index report.

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Written By

covers environmental, health, renewable and conventional energy, and climate change news. She's currently on the climate beat for Important Media, having attended last year's COP20 in Lima Peru. Sandy has also worked for groundbreaking environmental consultants and a Fortune 100 health care firm. She writes for several weblogs and attributes her modest success to an "indelible habit of poking around to satisfy my own curiosity."


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