Carbon Emissions Rise Under 'Dirty' Global Financial Recovery, Says PWC Report

The 'Dirty' Global Recovery

The global financial recovery has been a "dirty" one, with carbon emissions rising more swiftly than economic growth, a report has warned.

Analysis by the PwC Low Carbon Economy Index shows that during the recession many countries, including the UK, saw emissions fall faster than gross domestic product - a broad measure of the total economy - because their manufacturing output fell.

But in 2010, global GDP growth was just above 5%, while emissions rose by nearly 6%.

In the UK last year, greenhouse gas emissions increased by 3.5%, more than double the 1.3% growth in the economy, the PwC study said.

The report suggested that growth in emerging economies including China, Brazil and Korea, the fall in the price of coal compared with cleaner gas, a drop in renewable energy deployment and colder winters in the northern hemisphere at the beginning and end of 2010 all contributed to the carbon emissions rise.

It means that for the first year since 2000, no improvement has been made in decoupling growth and emissions by reducing the "carbon intensity" - the greenhouse gases emitted for each unit of economic output - of G20 economies.

PwC said the findings called into question whether the world could reduce emissions enough to stay within the goal of limiting global warming to just 2C above pre-industrial levels.

Leo Johnson, partner, sustainability and climate change, PwC, said: "The G20 economies have moved from travelling too slowly in the right direction, to travelling in the wrong direction.

"It is only in exceptional circumstances that countries have come close to removing 4.8% emissions from their economies over the course of a decade."

Jonathan Grant, director of PwC sustainability and climate change, said there was a need for a revolution in the way the world produces and uses energy, and a transformation in financing to shift the global economy to a low-carbon one at the scale and speed needed.

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