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A low-carbon economy (LCE), low-fossil-fuel economy (LFFE),[1] or decarbonised economy[2] is an economy that has a minimal output of greenhouse gas (GHG) emissions into the environment biosphere, but specifically refers to the greenhouse gas carbon dioxide. GHG emissions due to anthropogenic (human) activity are increasingly either causing climate change (global warming) or making climate change worse. Scientists are concerned about the negative impacts of climate change on humanity in the foreseeable future.[3]

Globally implemented LCEs are therefore proposed by those having drawn this conclusion, as a means to avoid catastrophic climate change, and as a precursor to the more advanced, zero-carbon society and renewable energy economy.

In terms of large industrialized nations, mainland France, due primarily to 75% of its electricity being produced by nuclear power, the country has the lowest carbon dioxide production per unit of GDP in the world and it is the largest exporter of electricity in the world, earning it approximately 3 billion euros annually in sales.[4]

Rationale and aims

Nations may seek to become low-carbon or decarbonised economies as a part of a national climate change mitigation strategy. A comprehensive strategy to mitigate, if that is possible, climate change is carbon neutrality and geoengineering.

The aim of a LCE is to integrate all aspects of itself from its manufacturing, agriculture, transportation, and power-generation, etc. around technologies that produce energy and materials with little GHG emission, and, thus, around populations, buildings, machines, and devices that use those energies and materials efficiently, and, dispose of or recycle its wastes so as to have a minimal output of GHGs. Furthermore, it has been proposed that to make the transition to an LCE economically viable we would have to attribute a cost (per unit output) to GHGs through means such as emissions trading and/or a carbon tax.

Some nations are presently low carbon: societies that are not heavily industrialised or populated. In order to avoid climate change on a global level, all nations considered carbon intensive societies, and societies that are heavily populated might have to become zero-carbon societies and economies. Several of these countries have pledged to cut their emissions by 100% via offsetting emissions rather than ceasing all emissions (carbon neutrality); in other words, emitting will not cease but will continue and will be offset to a different geographical area.

Energy policy

Renewable energy and energy efficiency

Recent advances in technology and policy will allow renewable energy and energy efficiency to play major roles in displacing fossil fuels, meeting global energy demand while reducing carbon dioxide emissions. Renewable energy technologies are being rapidly commercialized and, in conjunction with efficiency gains, can achieve far greater emissions reductions than either could independently.[5]

Renewable energy is energy that comes from natural resources such as sunlight, wind, rain, tides, and geothermal heat, which are renewable (naturally replenished). In 2008, about 19% of global final energy consumption came from renewables.[6] During the five years from the end of 2004 through 2009, worldwide renewable energy capacity grew at rates of 10–60 percent annually for many technologies. For wind power and many other renewable technologies, growth accelerated in 2009 relative to the previous four years.[7] More wind power capacity was added during 2009 than any other renewable technology. However, grid-connected photovoltaics increased the fastest of all renewables technologies, with a 60 percent annual average growth rate for the five-year period.[7]

Energy efficiency gains in recent decades have been significant, but there is still much more that can be achieved. With a concerted effort and strong policies in place, future energy efficiency improvements are likely to be very large. Heat is one of many forms of "energy wastage" that could be captured to significantly increase useful energy without burning more fossil fuels.[5]

Smart grid

One proposal from Karlsruhe University[8][9] developed as a virtual power station is the use of solar and wind energy for base load with hydro and biogas for make up or peak load. Hydro and biogas are used as energy storage. This requires the development of a smart intelligent grid hopefully including local power networks than use energy near the site of production, thereby minimising electrical grid losses.

Methane cycle

A further development of this at Kassel University,[10] Fraunhofer Institute, Negawatt Institute,[11] etc. is the use of the carbon capture, hydrogen and its conversion into methane (SNG synthetic natural gas) to act as a storage for intermittent renewables.

CO2 + 4H2 → CH4 + 2H2O Sabatier reaction

This involves the use of the existing natural gas (methane) grid as the store. In this case, the carbon dioxide is given economic value as a component of energy carrier.

This "solar fuel"[12] cycle uses the excess electrical renewable energy that cannot be used instantaneously in the grid, which otherwise would be wasted to create hydrogen via electrolysis of water. The hydrogen is then combined with CO2 to create synthetic or substitute natural gas SNG and stored in the natural gas network.

The natural gas is used to create electrical energy (and the heat used as well in CHP) on demand when there is not enough sun (photovoltaic, CSP...) or wind (turbines) or water (hydro, ocean current, waves,...). The German natural gas grid, for example, has two months of storage, more than enough to outlast renewable energy low production points.

Nuclear power and CCS

Nuclear power and/or the proposed strategies of carbon capture and storage (CCS) have been offered as the primary means to achieve a LCE while continuing to exploit non-renewable resources; there is concern, however, with the matter of spent-nuclear-fuel storage, security, and the uncertainty of costs and time needed to successfully implement CCS worldwide and with guarantees that the stored emissions will not leak into the biosphere. The liquid fluoride thorium reactor (LFTR) has been suggested as a solution to the concerns posed by conventional nuclear.[13]

Combined Heat and Power

Combined Heat and Power (CHP) is a technology which by allowing the more efficient use of fuel will at least reduce carbon emissions; should the fuel be biomass or biogas or hydrogen used as an energy store then in principle it can be a zero carbon option. CHP can also be used with a nuclear reactor as the energy source, there are examples of such installations in the far North of the Russian Federation.

Primary sector


Most of the agricultural facilities in the developed world are mechanized due to rural electrification. Rural electrification has produced significant productivity gains, but it also uses a lot of energy. For this and other reasons (such as transport costs) in a low-carbon society, rural areas would need available supplies of renewably produced electricity.

Irrigation can be one of the main components of an agricultural facility's energy consumption. In parts of California, it can be up to 90%.[14] In the low carbon economy, irrigation equipment will be maintained and continuously updated and farms will use less irrigation water.


Different crops require different amounts of energy input. For example, glasshouse crops, irrigated crops, and orchards require a lot of energy to maintain, while row crops and field crops do not need as much maintenance. Those glasshouse and irrigated crops that do exist will incorporate the following improvements:[15]

Glasshouse crops

  • environmental control systems
  • heat recovery using condensers
  • heat storage using buffer tanks
  • heat retention using thermal screens
  • alternative fuels (e.g., waste wood)
  • cogeneration (heat and power)

Irrigated arable crops

  • soil moisture measurement to regulate irrigation
  • variable-speed drives on pumps


Livestock operations can also use a lot of energy depending on how they are run. Feed lots use animal feed made from corn, soybeans, and other crops. Energy must be expended to produce these crops, process, and transport them. Free-range animals find their own vegetation to feed on. The farmer may expend energy to take care of that vegetation, but not nearly as much as the farmer growing cereal and oil-seed crops.

Many livestock operations currently use a lot of energy to water their livestock. In the low-carbon economy, such operations will use more water conservation methods such as rainwater collection, water cisterns, etc., and they will also pump/distribute that water with on-site renewable energy sources (most likely wind and solar).

Due to rural electrification, most agricultural facilities in the developed world use a lot of electricity. In a low-carbon economy, farms will be run and equipped to allow for greater energy efficiency. The dairy industry, for example, will incorporate the following changes:[15]

Irrigated Dairy

  • heat recovery on milk vats
  • variable speed drives on motors/pumps
  • heat recovery from hot water wash
  • soil moisture measurement to regulate irrigation
  • biodigester with cogen (heat & power)
  • vat wrap
  • solar water heating
  • ripple control
  • ice bank
  • chemical substitute for hot-water wash

Hunting and fishing

Fishing is quite energy intensive. Improvements such as heat recovery on refrigeration and trawl net technology will be common in the low-carbon economy.[15]


Main article: Wood economy

In the low-carbon economy, forestry operations will be focused on low-impact practices and regrowth. Forest managers will make sure that they do not disturb soil-based carbon reserves too much. Specialized tree farms will be the main source of material for many products. Quick maturing tree varieties will be grown on short rotations in order to maximize output.[16]


Main article: Gas flare

Flaring and venting of natural gas in oil wells is a significant source of greenhouse gas emissions. Its contribution to greenhouse gases has declined by three-quarters in absolute terms since a peak in the 1970s of approximately 110 million metric tons/year, and in 2004 accounted for about 1/2 of one percent of all anthropogenic carbon dioxide emissions.[17]

The World Bank estimates that 134 billion cubic meters of natural gas are flared or vented annually (2010 datum), an amount equivalent to the combined annual gas consumption of Germany and France or enough to supply the entire world with gas for 16 days. This flaring is highly concentrated: 10 countries account for 70% of emissions, and twenty for 85%.[18]

The top-ten leading contributors to world gas flaring in 2010, were (in declining order): Russia (26%), Nigeria (11%), Iran (8%), Iraq (7%), Algeria (4%), Angola (3%), Kazakhstan (3%), Libya (3%), Saudi Arabia (3%), and Venezuela (2%).[19]

Secondary sector

Basic metals processing

  • high efficiency electric motors
  • induction furnaces
  • heat recovery

Nonmetallic product processing

  • variable speed drives
  • injection molding - replace hydraulic with electric servo motors

Wood processing

  • high efficiency motors
  • high efficiency fans
  • dehumidifier driers

Paper and pulp making

  • variable speed drives
  • high efficiency motors

Food processing

  • high efficiency boilers
  • heat recovery e.g. refrigeration
  • solar hot water for pre-heating
  • bio fuels e.g. tallow, wood

Tertiary sector


Retail operations in the low-carbon economy will have several new features. One will be high-efficiency lighting such as compact fluorescent, halogen, and eventually LED light sources. Many retail stores will also feature roof-top solar panel arrays. These make sense because solar panels produce the most energy during the daytime and during the summer. These are the same times that electricity is the most expensive and also the same times that stores use the most electricity.[20]

Transportation services

Decarbonisation of (urban) mobility by means of:

  • More energy efficiency and alternative propulsion:
  • Less international trade of physical objects, despite more overall trade (as measure by value of goods)
  • Greater use of marine and electric rail transport, less use of air and truck transport.
  • Increased non-motorised transport (i.e. walking and cycling) and public transport usage, less reliance on private motor vehicles.
  • More pipeline capacity for common fluid commodities such as water, ethanol, butanol, natural gas, petroleum, and hydrogen (in addition to gasoline and diesel).


Health services

There have been some moves to investigate the ways and extent to which health systems contribute to greenhouse gas emissions and how they may need to change to become part of a low-carbon world. The Sustainable Development Unit[24] of the NHS in the UK is one of the first official bodies to have been set up in this area, whilst organisations such as the Campaign for Greener Healthcare[25] are also producing influential changes at a clinical level. This work includes

  • Quantification of where the health services emissions stem from.
  • Information on the environmental impacts of alternative models of treatment and service provision

Some of the suggested changes needed are:

  • Greater efficiency and lower ecological impact of energy, buildings, and procurement choices (e.g., in-patient meals, pharmaceuticals, and medical equipment).
  • A shift from focusing solely on cure to prevention, through the promotion of healthier, lower-carbon lifestyles, e.g. diets lower in red meat and dairy products, walking or cycling wherever possible, better town planning to encourage more outdoor lifestyles.
  • Improving public transport and liftsharing options for transport to and from hospitals and clinics.

Initial steps

A good overview of the history of international efforts towards a low-carbon economy, from its initial seed at the inaugural UN Conference on the Human Environment in Stockholm in 1972, has been given by David Runnals.[26] On the international scene, the most prominent early step in the direction of a low-carbon economy was the signing of the Kyoto Protocol, which came into force on February 16, 2005, under which most industrialized countries committed to reduce their carbon emissions.[27][28] Importantly, all member nations of the Organization for Economic Co-operation and Development except the United States have ratified the protocol. Europe is the leading geopolitical continent in defining and mobilising decarbonisation policies.[29] For instance, the UITP - an organisation advocating sustainable mobility and public transport - has an EU office, but less well developed contacts with, for example, the US. The European Union Committee of the UITP wants to promote decarbonisation of urban mobility in Europe.[30] Although Europe is nowadays the leading geopolitical continent with regard to lowering emissions, Europe is quickly losing ground to Asia, with countries such as China and South Korea.[31]


Costa Rica

Costa Rica sources much of its energy needs from renewables and is undertaking reforestation projects. In 2007, the Costa Rican government announced the commitment for Costa Rica to become the first carbon neutral country by 2021.[32][33][34]


Iceland began utilising renewable energy early in the 20th century and so since has been a low-carbon economy. However, since dramatic economic growth, Iceland's emissions have increased significantly per capita. As of 2009, Iceland energy is sourced from mostly geothermal energy and hydropower, renewable energy in Iceland and, since 1999, has provided over 70% of the nation's primary energy and 99.9% of Iceland's electricity.[35] As a result of this, Iceland's carbon emissions per capita are 62% lower than those of the United States[36] despite using more primary energy per capita,[37] due to the fact that it is renewable and thus limitless and costs Icelanders almost nothing. Iceland seeks carbon neutrality and expects to use 100% renewable energy by 2050 by generating hydrogen fuel from renewable energy sources.


Australia has implemented schemes to start the transition to a low-carbon economy but carbon neutrality has not been mentioned and since the introduction of such scheme emissions have increased. The current government has mentioned the concept but has done little and has pledged to lower emissions by 5-15%. In 2001, The Howard Government introduced a Mandatory Renewable Energy Target (MRET) scheme. In 2007, the Government revised the MRET - 20 percent of Australia's electricity supply to come from renewable energy sources by 2020. In 2009, the Rudd Government will legislate a short-term emissions reduction target, another revision to the Mandatory Renewable Energy Target as well as an emissions trading scheme. Renewable energy sources provide 8-10% of the nation's energy, and this figure will increase significantly in the coming years. However coal dependence and exporting conflicts with the concept of Australia as a low-carbon economy. Carbon-neutral businesses have received no incentive; they have voluntarily done so. Carbon-offset companies offer assessments based on lifecycle impacts to businesses that seek carbon neutrality. The Carbon Reduction Institute[38] is one such offset provider, that has produced a certification procedure to promote a low-carbon economy in Australia.

In 2011 the Gillard Government introduced a price on carbon dioxide emissions for businesses. Although often characterised as a tax, it lacks the revenue-raising nature of a true tax.

New Zealand


In China, the city of Dongtan is to be built to produce zero net greenhouse gas emissions.[39]

The Chinese State Council announced in 2009 it aimed to cut China's carbon dioxide emissions per unit of GDP by 40%-45% in 2020 from 2005 levels.[40] However carbon dioxide emissions were still increasing by 10% a year by 2013 and China was emitting more carbon dioxide than the next two biggest countries combined (U.S.A. and India).[41] Total carbon dioxide emissions were projected to increase until 2030.[42]

United Kingdom

In the United Kingdom, the Climate Change Act 2008 outlining a framework for the transition to a low-carbon economy became law on November 26, 2008. This legislation requires a 80% cut in the UK's carbon emissions by 2050 (compared to 1990 levels), with an intermediate target of between 26% and 32% by 2020.[43] Thus, the UK became the first country to set such a long-range and significant carbon reduction target into law.

A meeting at the Royal Society on 17–18 November 2008 concluded that an integrated approach, making best use of all available technologies, is required to move toward a low-carbon future. It was suggested by participants that it would be possible to move to a low-carbon economy within a few decades, but that 'urgent and sustained action is needed on several fronts'.[44]

In June 2012, the UK coalition government announced the introduction of mandatory carbon reporting, requiring around 1,100 of the UK’s largest listed companies to report their greenhouse gas emissions every year. Deputy Prime Minister Nick Clegg confirmed that emission reporting rules would come into effect from April 2013 in his piece for The Guardian.[45]



Companies are planning large scale developments without using fossil fuels. Development plans such as those by World Wide Assets LLC for entire cities using only geothermal energy for electricity, geothermal desalination, and employing full recycling systems for water and waste are under development (2006) in Mexico and Australia.


The MSc

The MSc. As well as a Carbon Finance MSc.

The University of East Anglia has a Strategic Carbon Management MBA.

The myclimate climate education[47] offers capacity building tools like exhibitions, games, schoolbooks and courses for young people, adults and businesses.

The MBA specialisation in Carbon Management.

See also


External links

  • Using Social Media for Low Carbon Economy
  • Resources on Low Carbon Economy
  • Status
  • Gas and Power in a Low Carbon Economy
  • Creating a low carbon economy
  • MSNBC.com
  • Hydrogen Economy
  • Grant Thornton International Business Report Energy & Environment survey
  • New "carbon revolution" urged to slow warming
  • World Bank Group, May 2013.
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