An equitable redistribution of unburnable carbon

The rapid phase-out of fossil fuels is critical to achieving a well-below 2°C world. An emerging body of research explores the implications of this phase-out for fossil fuel producing countries, including the perceived tension between least-cost and most-equitable pathways. Here we present modelling, which re-distributes remaining fossil fuel production towards developing countries. We show that redistribution is challenging due to large economic disincentives required to shift production, and offers limited economic benefit for developing countries given the long timeframe required to effect change, and the wider impact of rising fuel import and energy systems costs. Furthermore, increases in production shares are offset by shrinking markets for fossil fuels, which are part dependent on carbon capture and storage (CCS). We argue that while there is a weak economic case for redistribution, there is a clear role for equity principles in guiding the development of supply side policy and in development assistance.

Steve Pye, Siân Bradley, Nick Hughes, James Price, Daniel Welsby, Paul Ekins