20150504_R4

Source: BBC Radio 4: Today Programme

URL: N/A

Date: 04/05/2015

Event: Lord Stern: "The big subsidy in the world is to fossil fuels"

Credit: BBC Radio 4

People:

• John Humphrys: Presenter, BBC Radio 4: Today Programme
• Lord Nick Stern: Baron Stern of Brentford, British economist and academic

John Humphrys: There's a big international meeting planned in Paris in December, with a big aim - to rescue the world from the consequences of climate change. It's not the first but this, they say, will be the one that matters, the one where all the most polluting countries make pledges to reduce their emissions and ensure that the world's temperature does not rise by more than 2 degrees by 2030. Lord Stern says these pledges are not enough, and he's the man who wrote the climate change review for the British government nine years ago, that had real consequences. He's on the line, good morning to you.

Lord Stern: Good morning, John.

John Humphrys: Are you saying that this conference has failed before it's even begun?

Lord Stern: No, I'm not. I'm saying that it is going to fall short of the 2 degrees Centigrade target, in the sense that the total amount of emissions that will be pledged for 2030 will be quite a way above what we would need for a 2-degree target. But it will be a major change from anything like business as usual, it might get us halfway from business as usual to where we need to go. But what we have to understand, therefore, is we need to ramp up our ambitions before December this year, when the pledges will finally be made. And - and this is very important - we have to see it as a floor or a first step, so that we have to build into that agreement mechanisms for review of where we are and ramping up.

John Humphrys: The problem with that is that many of those who will be there, perhaps most who will be there, in Paris in December, will see it not as a floor but as a ceiling, the maximum that they would accept.

Lord Stern: I don't think so. Um, a few years ago, in Durban, which was another one of these gatherings, there was clear recognition of the gap between current intentions and where we need to be. So I think that gap will be an integral part of the discussions, so that there will be - and certainly should be - a focus on how that gap is closed, as we move forward from Paris, and we should build that in to the discussions.

John Humphrys: And yet we've had endless - feels as though we have had endless conferences - we've certainly had a lot. And the world is still getting hotter...

Lord Stern: This one is 21 -

John Humphrys: 21!

Lord Stern: This one is 21... 21.

John Humphrys: Well, there you go, you make my point for me. And the world is still getting hotter.

Lord Stern: But, as we've moved on, the understandings have, um, grown clearer and the commitments grown stronger. But you're absolutely right, John, the world has been getting hotter. There are odd fluctuations and plateaus, but if you look at the way it's moved over the past decades, it's unambiguously getting hotter. And we've seen the effects of that - it's about 0.8 degrees Centigrade higher than the end of the 19th century, the usual benchmark, around the time of the industrial revolution. And we're headed, on current plans, for 3 and a half degrees or 4 degrees a hundred years or so from now. So the consequences we're seeing, of this real warming, are very small, rela- big as they are, relative to what we could see, and that's why it's so urgent to get an agreement.

John Humphrys: The criticism of your approach - not just you, others who preach the same message as you - is that you've misdiagnosed the obstacles to climate change, and one of your critics, as you well know, is Michael Grubb of University College London. And the point they make is that: yes, terribly important people may sit down at terribly important conferences and say "We must do this, that and the other". The people who really matter are people who don't want a windfarm next to them, people who don't want the field facing their village to be covered in solar panels, and so on and so on and so on... And it's politics, in the end, that is going to determine this. And, as the man once said, "All politics is local".

Lord Stern [laughing slightly]: Yes, John. Um, first I'm not a preacher, I'm a Professor of Economics and President of the British Academy. My job -

John Humphrys: All right - withdraw that.

Lord Stern: My job - thank you, thank you, John. And we have to analyse the science, the economics and the politics, and nobody pretends that the politics is easy. But if you look at investment in electricity generating capacity in the world, we now have more investment in non-hydrocarbons than hydrocarbons. So, difficult though those obstacles are, we are overcoming them. The challenge is to overcome them more quickly. But to suggest that those are obstacles which cannot be overcome is just straight wrong.

John Humphrys: The problem with all that investment, though, is most of it is very, very heavily subsidised by governments, and again that's something that voters may not put up with for very much longer - you can't be sure of that.

Lord Stern: Those - the things we're talking about, actually, most of them have not much subsidy or no subsidy at all. The big subsidy in the world is to fossil fuels. Directly there are subsidies to fossil fuels, to the tune of many hundreds of billions of dollars a year, about $500 billion a year. And that doesn't count the subsidy for not charging people for the pollution they put into the atmosphere.

John Humphrys: So the oil companies get subsidies from the taxpayer?

Lord Stern: The, er, you have through tax systems, you have exploration subsidies, essentially - the biggest subsidies that in the numbers I'm referring to are, um, mostly in emerging markets - countries. But the subsidy from not taxing the pollution that the burning of fossil fuels spews out is a real subsidy, a subsidy of a very large magnitude. If you can treat the atmosphere as a place just for dumping, and you can do it for free and that causes real damage, that's a subsidy in a real sense -

John Humphrys: All right -

Lord Stern: - the subsidy's big, and that's on fossil fuels.

John Humphrys: Have to end it there. Thanks very much indeed, Lord Stern.