Policy brief

Cutting carbon, not the economy

A drastic change in the way we produce and consume energy is necessary to contain the risk of global environmental catastrophe. For its part, the EU

Publishing date
02 February 2012
Authors
Georg Zachmann

A drastic change in the way we produce and consume energy is necessary to contain the risk of global environmental catastrophe. For its part, the EU has set agreed to a greenhouse gas reduction target of 80-95 percent by 2050, compared to 1990.

However, with the current fuel mix, even the most ambitious improvements on incumbent technologies are unlikely to be sufficient for reaching the reduction targets.

Meeting the targets requires low-carbon transition. However, the process of transition will likely be littered with market failures.

Hundreds of more-or-less proven low-carbon technologies are competing for market share in the low-carbon system. In order to bring about the transition to a low-carbon energy and transport system at the lowest cost, policymakers should rely as much as possible on private action to choose, develop, and deploy low-carbon technologies.

For those market failures that might only be overcome with technology-specific measures, governments should set up a transparent and predictable mechanism for selecting technologies.

This Policy Contribution largely draws on research conducted for The great transformation: decarbonising Europe’s energy and transport systems.

The research leading to these results has received funding from the Fuel Cell and Hydrogen Joint Undertaking (FCH). The views expressed in this publication are those of the author alone and do not necessarily reflect the views of FCH.

About the authors

  • Georg Zachmann

    Georg Zachmann is a Senior Fellow at Bruegel, where he has worked since 2009 on energy and climate policy. His work focuses on regional and distributional impacts of decarbonisation, the analysis and design of carbon, gas and electricity markets, and EU energy and climate policies. Previously, he worked at the German Ministry of Finance, the German Institute for Economic Research in Berlin, the energy think tank LARSEN in Paris, and the policy consultancy Berlin Economics.

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This dataset aggregates daily data on European natural gas import flows and storage levels.

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