IT IS easy to feel anxious about the state of the climate. July was the hottest month on record and hurricanes, floods and wildfires have recently ravaged many countries. Despite this, last week, the UK government delayed its plans for net zero. Rising carbon emissions put the world on course to increase its average temperature by about 2.7°C above preindustrial temperatures by the end of this century – almost double the Paris Agreement’s target of 1.5°C. But we can decarbonise the global economy far quicker, says Simon Sharpe, who has spent a decade working at the forefront of climate change diplomacy.
Sharpe joined the UK Foreign Office in 2005, where he worked on everything from human rights policy to counterterrorism. In 2012, he stumbled on a climate science lecture that made him realise catastrophic climate change wasn’t a negligible risk, but a likely scenario, and needed to be communicated to governments as such. He soon took on a series of climate-related government jobs, culminating in a high-profile role at the COP26 climate summit in Glasgow, UK, in 2021.
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Today, Sharpe is and director of economics at the philanthropically funded organisation .
In his recent book , Sharpe argues that it is time to see the economy as dynamic and invest in new technologies, rather than protecting the status quo. The institutions that are supposed to be helping us tackle climate change, he says, are inadvertently slowing us down. He tells żěè¶ĚĘÓƵ what has gone wrong with our approach to climate science, economics and diplomacy – and how we can still keep the rise in global temperatures below 1.5°C.
Michael Marshall: If I were to sum up your book Five Times Faster in five words, it would be “you’re all doing it wrong”.
Simon Sharpe: That is certainly the message. But, of course, I’m also trying to say: “This is what it would look like if you did it right.”
In the book, you write that “science is pulling its punches”. What do you mean by that?
A lot of the information generated by climate change scientists and presented to governments is done in the form of prediction, rather than risk assessment. Prediction focuses first on what’s most likely to happen, and second on if it has an impact on anything we care about. Risk assessment asks more or less the same questions, but the other way around. First, what’s the worst that could happen in relation to something we care about, and second how likely is it to happen.
We don’t know as much as we should about worst-case scenarios for climate change, and what we do know isn’t put at the forefront of the information that’s communicated to governments. If you want your political leaders to act strongly, then a minimum requirement is that they know there’s a bloody enormous problem.
Scientific culture can be a barrier to this because scientists prefer to communicate the findings in which they have the most confidence. Sometimes, these are less relevant to society than the possibilities that are highly uncertain but potentially catastrophic. żěè¶ĚĘÓƵs need to be bolder in talking about worst-case scenarios. Governments can help by asking the right kinds of questions.
You draw an analogy with counterterrorism: policy-makers don’t worry about the most likely thing to happen tomorrow, because that is nothing. Instead, they focus on the worst possible attacks. What is an example of a worst-case scenario for climate change?
London obviously has a risk of flooding. Engineers built the Thames Barrier half a century ago to prevent that. There’s one study – which isn’t widely recognised – that makes an estimate of London’s limit to adapt and protect itself against global sea level rise. The limit is .
There’s a lot you can do before that: extend the barrier, build it taller, build a new barrier further out to sea. But the estimate is that, once you get to around 5 metres of global sea level rise, the only way you could protect London is to build a wall around the city centre and pump the river Thames over the top. The difficulty, the expense and the residual risk that entails would all be so bad that you probably wouldn’t bother.
Having established there’s a threshold, you then have to ask: how likely is that to be crossed? If you look at the Intergovernmental Panel on Climate Change (IPCC) projections, a sustained warming of 2°C is estimated to commit the world to sea level rise of . This is double London’s limit of adaptation. The IPCC’s most recent Assessment Report included a plausible worst-case scenario for global sea level rise for the first time. In that scenario, we .
That’s quite shocking if you’re a British politician working on the banks of the Thames, as they all are. Politicians should know that. But whenever I mention it to a UK civil servant or government minister, they are stunned. Why on Earth did they not hear that before?
In Five Times Faster, you argue that the global economy, like the climate, is less stable than we expect – and that this is a source of opportunity.
Part of the problem is that we’ve thought about policy on climate change using old economic ideas, such as equilibrium. This means that the economy is balanced because supply and demand in the market are equal to each other. The idea of equilibrium was brought into economics in the 1870s for a strange reason. It wasn’t because anybody looked at the economy and said: “That looks like a system in equilibrium.” It was because some economists wanted economics to look like a science. They thought that meant it should be described with maths equations, but to make any of the equations solvable, the system had to be in equilibrium.
In economics, equilibrium is defined as a situation where nobody has any reason to change their actions, so that the status quo can continue. If you think about the economy, it’s pretty hard to think of a situation where that is the case. When we make this false assumption, it creates a massive bias against doing anything to change the economy. By definition, anything you do to it makes it worse.
How does this affect how we go about finding solutions to climate change?
Governments are still getting advice from many quarters telling them the most efficient thing they can do is put a price on carbon. In this picture, the risk of climate change is understood to arise because of a deviation from the economy’s normal equilibrium state. There is a “market failure” because the interests of the private sector aren’t aligned with society. Putting a price on carbon fixes this failure and returns the economy to equilibrium.
What is the alternative to carbon pricing?
If the economy is a thing that changes, and if your goal is structural change, then it makes sense to invest in new technologies and new systems. This activates reinforcing feedback loops in the growth of those new solutions, such as economies of scale and learning by doing. Those are really powerful dynamics. That’s what drives Moore’s law, which doubles the processing power of computers every couple of years. That’s what has driven solar power to fall in cost by .
People have got this idea of carbon pricing stuck in their heads, but as soon as you point to past technology transitions, it’s obvious. Nobody thinks we made the transition from horses to cars by taxing horseshit. Nobody thinks that we created the internet by taxing letter writing. Why would it be any different for the transition to the clean economy?
So we need a new kind of economics?
Yes. There’s a new approach called complexity economics or evolutionary economics. It models the economy as an evolutionary system which is dynamic and constantly changing. Economic behaviour is determined by both individuals and society as a whole. That gives you whole new ways you can simulate change and understand how to make interventions that will be successful.
What does this mean in practice for governments struggling with the net-zero transition?
Early in the transition, in any sector, the most important thing governments can do is invest in creating new solutions. That means investment in research, development and technology demonstration. It also means investment in targeted subsidies so that these solutions can take root while they are still more expensive than the fossil fuel alternatives.
Once those solutions become competitive, regulation can force industry to invest in them. You see that now in road transport. The leading countries have zero-emission vehicle mandates where they tell the car manufacturers: “If you want to sell cars, then this year 20 per cent of the cars have to be zero-emission, and next year it’ll be 25 per cent, and so on up to 100 per cent.” You don’t have to spend public money on those policies, as you’re just reallocating private investment. Those kinds of policies are incredibly effective.
On the international level, a lot of effort has gone into trying to create an agreement where every country signs up to binding carbon emissions targets. Has that effort been wasted?
That has been a great mistake of climate change diplomacy for the past 30 years. We have a negative-sum game where we’re all trying to agree how to divide up the global carbon pie. There is, I argue, a positive-sum game, which is saying: “Hang on a minute, in all of these sectors, the zero-carbon solution could eventually be better than the fossil fuel solution. Why don’t we work together to get there quickly?”
That’s not in everybody’s interests. Saudi Arabia isn’t going to be the biggest supporter of the transition to electric vehicles. But we don’t need to work with Saudi Arabia on that one. The US, European Union and China together are about 60 per cent of the global car market. Working with those three actors is just fine. They set the pace. They’ll bring the entire global automobile industry with them. The crucial thing is that, in each sector, you need to work with a critical mass of countries that are capable of shifting the global market in that sector.
We have spoken a lot about what people in governments can do. What about the rest of us?
Don’t worry so much about your carbon footprint. Think more about your point of leverage. What is the thing that you can do better than most people to, in some way, bring about system change? It may simply be voting for the right party. That’s something all of us can do: exercise our democratic rights, carry on voting, campaign.
For many people, it’s likely to be related to their profession. What kind of organisation do you work for? What can it most usefully do? The point of leverage is always to do with the core capabilities of an organisation. For example, if you’re a university academic, what you research and teach is more important than whether you’ve insulated your buildings. If you’re an advertising company, withholding your business from media that publish climate misinformation is more important than choosing the vegan option when you take your clients out for lunch. This is more powerful than just thinking about your footprint.
Michael Marshall is a freelance writer based in Devon, UK
