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Low-carbon economy

A low-carbon economy (LCE), low-fossil-fuel economy (LFFE),[1] or decarbonised economy[2] is an economy based on low carbon power sources that therefore 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 near future.

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 economy.

In terms of large industrialized nations, mainland France, due primarily to 75% of its electricity being produced by nuclear power, 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 annually in sales.[3]


  • Rationale and aims 1
    • Energy policy 1.1
      • Renewable energy and energy efficiency 1.1.1
      • Smart grid 1.1.2
      • Methane cycle 1.1.3
      • Nuclear power and CCS 1.1.4
      • Combined Heat and Power 1.1.5
  • Primary sector 2
    • Agriculture 2.1
      • Crops 2.1.1
      • Livestock 2.1.2
    • Hunting and fishing 2.2
    • Forestry 2.3
    • Mining 2.4
  • Secondary sector 3
    • Basic metals processing 3.1
    • Nonmetallic product processing 3.2
    • Wood processing 3.3
    • Paper and pulp making 3.4
    • Food processing 3.5
  • Tertiary sector 4
    • Retail 4.1
    • Transportation services 4.2
    • Health services 4.3
  • Initial steps 5
    • Countries 5.1
      • Costa Rica 5.1.1
      • Iceland 5.1.2
      • Australia 5.1.3
      • New Zealand 5.1.4
      • China 5.1.5
      • United Kingdom 5.1.6
      • India 5.1.7
    • Cities 5.2
  • Education 6
  • See also 7
  • References 8
  • External links 9

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. EU emission trading system allows companies to buy international carbon credits, thus the companies can channel clean technologies to promote other countries to adopt low-carbon developments.[4]

Energy policy

Renewable energy and energy efficiency

Worldwide installed wind power capacity 1997–2020 [MW], history and predictions. Data source: WWEA
Solar array at Nellis Solar Power Plant. These panels track the sun in one axis. Credit: U.S. Air Force photo by Senior Airman Larry E. Reid Jr.

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]


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]


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 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] However, the 2014 Global Green Economy Index™ (GGEI) [32] ranks 60 nations on their green economic performance, finding that the Nordic countries and Switzerland have the best combined performance around climate change and green economy.


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.[33][34][35]


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.[36] As a result of this, Iceland's carbon emissions per capita are 62% lower than those of the United States[37] despite using more primary energy per capita,[38] 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 Second Rudd Government 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. 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[39] is one such offset provider, that has produced a certification procedure to promote a low-carbon economy in Australia. Though the only true certified carbon neutral scheme is the Australian governments National Carbon Offset Standard (NCOS). Three of the four of Australia's top banks are now certified under this scheme and full list of compliant companies can be seen here . Businesses are now moving from unaccredited schemes such as noco2 and transitioning to NCOS as the only one that is externally audited. Most of leading carbon management companies have also aligned with NCOS such as Net Balance , Pangolin Asscociates Energetics and the big four accounting firms.

In 2011 the Gillard Government introduced a price on carbon dioxide emissions for businesses. Although often characterised as a tax, it lacked the revenue-raising nature of a true tax. In 2013, on the election of the Abbott government, immediate legislative steps were taken to repeal the so-called carbon tax. The price on carbon was repealed on the 17th July 2014 by an act of parliament. As it stands Australia currently has no mechanism to deal with climate change.

New Zealand


In China, the city of Dongtan is to be built to produce zero net greenhouse gas emissions.[40]

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.[41] 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).[42] Total carbon dioxide emissions were projected to increase until 2030.[43]

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 an 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.[44] 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'.[45]

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.[46]

In July 2014, the UK Energy Savings Opportunity Scheme (ESOS) came into force.[47] This requires all large businesses in the UK to undertake mandatory assessments looking at energy use and energy efficiency opportunities at least once every four years.[48]

The low carbon economy has been described as a "UK success story", accounting for more than £120 billion in annual sales and employing almost 1 million people. A 2013 report suggests that over a third of the UK's economic growth in 2011/12 was likely to have come from green business.[49]


Low carbon strategies for inclusive growth - An interim report (India), May 2011[50]


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 University of Reading has a Renewable Energy inc. a carbon management module MSc

The University of Edinburgh has a Carbon Management MSc. As well as a Carbon Finance MSc.

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

The myclimate climate education[51] offers capacity building tools like exhibitions, games, schoolbooks and courses for young people, adults and businesses.

The London School of Business and Finance has an MBA specialisation in Carbon Management.

See also


  1. ^ Nanomech in Photovoltaics: Dye Sensitized Solar Cells
  2. ^ Greenpeace (2010), Decarbonised Economy - Opportunities and responsibilities of the ICT sector in a changing climate
  3. ^
  4. ^ "The EU Emission Trading System(EU ETS) Factsheet". European Comission. European Union. Retrieved 27 Oct 2014. 
  5. ^ a b Janet L. Sawin and William R. Moomaw. Renewable Revolution:Low-Carbon Energy by 2030 Worldwatch Report, 2009.
  6. ^ REN21 (2010). Renewables 2010 Global Status Report p. 15-16.
  7. ^ a b REN21 (2010). Renewables 2010 Global Status Report p. 15.
  8. ^ Combined Power Plant video
  9. ^ Combined Power Plant
  10. ^ Bioenergy and renewable power methane in integrated 100% renewable energy system
  11. ^ scénario négaWatt 2011 (France)
  12. ^ Solar Fuel
  13. ^ Cooper, N.; Minakata, D.; Begovic, M.; Crittenden, J. (2011). "Should We Consider Using Liquid Fluoride Thorium Reactors for Power Generation?". Environmental Science & Technology 45 (15): 6237.   "LFTR can mean a 1000+ year solution or a quality low-carbon bridge to truly sustainable energy sources solving a huge portion of mankind’s negative environmental impact."
  14. ^ Flex Your Power - Agricultural Sector
  15. ^ a b c New Zealand Energy Intensive Business Initiative,
  16. ^ Trees and their role in carbon management for land and business, The Woodland Trust.
  17. ^ Emissions2Global, Regional, and National CO. In Trends: A Compendium of Data on Global Change, Marland, G., T.A. Boden, and R. J. Andres, 2005, Carbon Dioxide Information Analysis Center, Oak Ridge National Laboratory, U.S. Department of Energy, Oak Ridge, Tennessee.
  18. ^ Global Gas Flaring Reduction"The World Bank,
  19. ^ Globas Gas Flaring Reduction, The World Bank.
  20. ^ Grocery Store Sets California Solar Standard, Renewable Energy World, 22 August 2005.
  21. ^ Energy Information Administration Industry Analysis Briefs,
  22. ^ Carbon Trust,
  23. ^ BERR - Redirect
  24. ^
  25. ^
  26. ^ (1)4 S.A.P.I.EN.S.Runnals, D. (2011) “Environment and economy: joined at the hip or just strange bed-fellows?”.
  27. ^ Japan Low Carbon Society Scenarios toward 2050
  28. ^ Margot Wallström (11 March 2004). Towards a low carbon economy (Speech). Brussels. Retrieved 2008-08-19. 
  29. ^ The decarbonisation challenge - US and European perspectives, EurActiv, 28 march 2007
  30. ^ UITP (2011), More and better public transport is the key to decarbonised mobility in Europe
  31. ^ Holmes et al (2012), Financing the Decarbonisation of European Infrastructure
  32. ^ [1]
  33. ^ "Costa Rica Aims to Be a Carbon-Neutral Nation". Retrieved 2008-02-18. 
  34. ^ "Costa Rica Aims to Become First "Carbon Neutral" Country". Retrieved 2008-02-18. 
  35. ^ "País quiere ser primera nación con balance neutro de carbono" (in Spanish). Retrieved 2008-02-18. 
  36. ^ "Gross energy consumption by source 1987–2005" (XLS). Statistics Iceland. Retrieved 2007-05-14. 
  37. ^ "United Nations Millennium Development Goals Indicators".  
  38. ^ "Energy in Iceland". Icelandic Ministries of Industry and Commerce. Retrieved 2007-05-14. 
  39. ^ Carbon Reduction Institute
  40. ^ "Arup unveils plans for world’s first sustainable city in Dongtan, China".  
  41. ^
  42. ^ Borenstein, Seth (12 April 2013) China's Carbon Emissions Directly Linked To Rise In Daily Temperature Spikes, Study Finds The Huffington Post, Retrieved 15 May 2013
  43. ^ Kaiman, Jonathan (26 November 2012) China's emissions expected to rise until 2030, despite ambitious green policies The Gurdian, Retrieved 15 may 2013
  44. ^ "New Bill and strategy lay foundations for tackling climate change".  
  45. ^ Towards a low carbon future, Royal Society, 29 June 2009
  46. ^ "Rio's reprise must set hard deadlines for development".  
  47. ^ "The Energy Savings Opportunity Scheme Regulations 2014". UK Government. Retrieved 9 July 2014. 
  48. ^ "ESOS: Energy Savings Opportunity Scheme". The Carbon Trust. Retrieved 9 July 2014. 
  49. ^ "Low Carbon Entrepreneurs: the new engines of growth". The Carbon Trust. May 2013. Retrieved 25 July 2014. 
  50. ^ “Productive usage of Biomass”
  51. ^ , Myclimate Education

External links

  • Using Social Media for Low Carbon Economy
  • Resources on Low Carbon Economy
  • The “Low Carbon Economy Act” of 2007 and Status
  • British Petroleum: Gas and Power in a Low Carbon Economy
  • DTI UK: Creating a low carbon economy
  • Europe eyes 'low-carbon economy',
  • Hydrogen Economy
  • Grant Thornton International Business Report Energy & Environment survey
  • New "carbon revolution" urged to slow warming
  • Turning the right corner: ensuring development through a low-carbon transport sector, World Bank Group, May 2013.
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