There were worrying signs at the World Economic Forum in January that policymakers are becoming dangerously complacent about the scale of our climate change challenge. Now, with political unrest, economic uncertainty and soaring oil prices understandably dominating the headlines, there is a risk of further distraction from the action required to meet our current climate change goals.

We must not delude ourselves. Existing commitments for emissions reductions by 2020 do represent major action. But even if implemented fully, they are collectively not enough to put the world on a path that would give us even a 50-50 chance of avoiding a warming of 2°C above 19th century temperatures. Worse still, recent work by the International Energy Agency has concluded that without full implementation there is a real risk that the 2°C goal will be pushed out of our reach altogether. A less ambitious target is not good enough: global temperatures have not been 3°C higher than today for about 3m years. Such warming would likely lead to mass migrations away from the worst affected regions, with the risk of severe and prolonged conflict.

There is some good news to report. Governments in industrialised countries are accelerating the development of clean energy, while developing countries such as China, India and Brazil are becoming leaders in renewables. Many are also setting strong targets for reducing deforestation. An increasing number of far-sighted companies are making made radical emissions reductions central to their strategies.

Even so, global emissions per unit of output must now be cut by two-thirds in the next 25 years, just to get on to a 2°C path. Changes will be needed across all economic sectors, including agriculture. Halting deforestation must be a priority. Change of this nature will also require dramatic improvements in energy efficiency, and a fundamental transformation in the power and transport sectors.

We must decarbonise the power sector too, which today accounts for 40 per cent of energy-related emissions. The problem is that, as the IEA has shown, 80 per cent of projected emissions in 2020 are already “locked-in”, as a result of power plants that already exist or are under construction. This limits room for manoeuvre and underlines the sense of urgency for action.

In transport, around 25 per cent of energy emissions, a number of countries and companies have set targets that could see 20m electric vehicles on our roads by 2020. But this only represents 2 per cent of the projected global car fleet of 1bn, in 10 years’ time. Again we risk setting ambition far too low.

Policymakers must now intensify efforts as we work towards the next UN summit, in Durban in December 2011. Action will vary from country to country but should include three common elements. First, benchmarking tools should be used to bring energy efficiency to best practice levels. Energy efficiency measures help to address current economic anxieties, and can deliver half of the emissions reductions necessary to achieve the 2°C goal.

Second, we need strong disincentives, such as adequate carbon pricing, against keeping old infrastructure, and more incentives to bring in new low-carbon technologies. Fossil fuel subsidies, amounting to $558bn worldwide in 2008, must go. They are costly, environmentally damaging and a grossly inefficient way to protect the incomes of poor people.

Third, measures to improve fuel economy, expand sustainable biofuels and promote the uptake of new vehicle technologies must be prioritised. This will bring about the cost and security benefits of cutting oil import bills and it is also crucial in reducing emissions. Energy sector research and development must be scaled up and protected vigorously.

At a time of intense fiscal pressure, revenue from carbon pricing and the savings from energy efficiency can fund these policies, and also lay the foundations for future growth. Such moves will improve energy security, and become an important part of global economic prosperity. But fundamentally tackling climate change is not a target that can be reset or discarded when the going gets tough. For the moment our climate goals remain attainable, but the door is closing.

Fatih Birol is chief economist at the International Energy Agency. Nicholas Stern is chair of the Grantham Research Institute on Climate Change at the LSE

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