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This chapter addresses the widespread assumption that capitalism's future can best be understood as made up of more, and better, technology. The scale of scientific and technological activity today is wholly unprecedented, and guarantees a flood of new knowledge and things. A succession of “longwave theories” have tried to make sense of the long cycles of economic change, and now hint at a new kind of economy emerging from low carbon technologies, broadband, genomics, and nanotechnology. But technologies have always been as much shaped by societies as shaping them, and people should expect struggles to shape technology and science—struggles that will often pit big governments and big business against the public.

This chapter introduces the panel entitled “Reducing Climate Risk” by discussing three trends that are driving our reaction to climate risk as they unfold. First, we have begun the transition to the low-carbon high-efficiency (LCHE) economy. Large-scale commercialization of wind and solar is under way, and the energy efficiency stampede is not far behind. Progress is fitful, however, and it is far too slow. The second trend pertains to global warming. Some of the adverse consequences of global warming are already locked into the atmosphere. The food squeeze has begun, and we have begun to experience changes in water availability and regularity. A third trend is decreasing the ability of governments to buffer the volatility of all sorts of risks. The chapter asks: Are there sensible medium- and long-term investment opportunities with which to ride the trend toward an LCHE economy and support sound development at the same time? Are there ways to protect investments against climate-connected disruptions?

This chapter presents responses to some questions and/or comments raised during the panel on reducing climate risk. One participant asked for elaboration on how tariffs could be structured so that they are not essentially just competitiveness tariffs but ways for rich countries to equilibrate differences in cost of production from lower-priced producers. Another commented that the urgency to pursue a low-carbon economy makes some forget other, basic considerations. We lack recognition of the patience and the investment required in the institutions that can be lasting and address these issues on the ground. A participant suggested that innovative new technologies provide an opportunity for the South to leapfrog the North so that the North can be left behind and be the ultimate losers. Finally, a participant raised the issue of the cost of increasingly severe natural disasters attributed to global warming.

This chapter summarizes the panel discussion on reducing climate risk. It describes how the transition to the low-carbon high-efficiency (LCHE) economy and the explosive growth in the global middle class will lead to a number of new markets and a number of disruptions in existing markets. Innovations are coming, in carbon-free energy sources and in smart energy initiatives, all of which will have vast implications for sovereign wealth funds (SWFs). The Carbon Disclosure Project (CDP), with its initiatives on water, bonds, and accounting, is an entity with which SWFs can partner to ensure a rational response to climate change through information. SWFs should also examine their portfolio exposure and work to gain more exposure to some of the upward dynamics that will ensure their returns.

This chapter tests the idea of connecting climate policies and the social investment approach in order to elaborate a European Model for Sustainable Development. It argues that the success of EU climate policies, which have hitherto been largely unrelated to social policy, will be strongly dependent on social policy design. They have been designed in favour of liberalized energy markets, based on market-related policy instruments and limited state intervention. But these neoliberal EU climate policies are viewed with growing discontent. Problems identified include volatile energy prices, lack of investment in low-carbon energy and ‘fuel poverty’. The chapter argues that income redistribution and appropriate employment policies to re-skill the labour force in order to respond to the needs of a low-carbon economy are crucial elements for successful climate change mitigation. It then discusses the likelihood of a policy shift in the EU towards a paradigm for sustainable development. By providing a coherent approach to climate policy and social policy, the sustainable development paradigm carries the potential to strengthen the social investment approach and improve social policy design in support of climate change mitigation.

This chapter critically explores the interconnection between the emerging climate change agenda in the UK and cities. Focusing on one key national strategy – the 2009 UK Low Carbon Transition Plan (Department of Energy and Climate Change 2009) – it examines the emergence of a new ‘low carbon’ urban politics and the strategic roles envisioned for cities in the low carbon transition. The chapter finds an ambivalent urban climate politics, articulated through the tensions between seeking to manage carbon ‘from the top down’ and opening up space for experimentation and alternatives on the one hand, and the ambitions for universal ‘transitions’ and the specificities of place on the other.

Although its historical greenhouse gas emissions are very low and per capita emissions are below the world average, China is the second largest emitter of greenhouse gases, next to the United States. As a developing country at a low developmental stage, with a huge population, a coal-dominated energy mix, and relatively low capacity to tackle climate change, China will surely face severe challenges when coping with climate change along with the acceleration of urbanisation, industrialisation, and the increase of residential energy consumption. The Chinese government has made great efforts to promote technology advancement and energy efficiency improvement, among other initiatives. This has significantly reduced and mitigated the increase of greenhouse gas emissions and the impacts thereof. After providing some general background information, this chapter examines the relevant legal issues that are closely related to the development of a low-carbon economy in China, such as the laws on energy conservation, renewable energy, nuclear energy and hydrogen energy, and the development of new energy technology.

Industrial policy is vital for sustainability in its broadest sense: both environmental as well as societal sustainability will depend on industrial policy. In a world characterized by growing inter- and intra-country inequality, industrialization offers scope for providing job opportunities, incomes, and the chance for industrially lagging countries to catch up. In a world facing the specter of climate change, low-carbon industrialization, and green growth paths have become imperatives. Moreover, promoting low-carbon industrialization and obtaining its accompanying development benefits will itself improve the ability of currently poor countries to adapt to climate change. It is the case that the best defence against climate change is economic development. Although the Earth’s climate has always been changing there is now wide agreement that the climate is warming and that human emission of greenhouse gases is a contributing factor.

Entrepreneurs play an important part in economic growth and development. Entrepreneurs are also vital in the process of structural change or industrialization, a process without which development is not possible. Entrepreneurial innovation leads to the reallocation of resources from the traditional (agricultural) sector to the modern (manufacturing) sector. There is substantial agreement that recovery after the 2008–09 global financial and economic crises and the challenge of climate change will require more, not less, of such entrepreneurial innovation. What is needed are quality jobs through low-carbon industrialization. There is now a growing rediscovery of industrial policy as being necessary to overcome a number of market failures that inhibit entrepreneurial innovation in job creation and low-carbon industrialization. This implies an industrial policy where the relationship between government and entrepreneurs (the private sector) is important.

The prospect of low-carbon economic development involves the valuation of myriad costs and benefits, and includes the consideration of a number of innovative proposals to spur growth without degrading environmental resources. This chapter describes Liberia’s wealth of forests and explains how a low-carbon development strategy for Liberia could include a number of cost-beneficial policies, the most obvious being a transition to more efficient agriculture. Other beneficial policies include accelerating the establishment of protected areas, ensuring that tree crop plantations are located on degraded land rather than forest areas, and introducing energy-efficient stoves for charcoal and fuel wood. The net benefits of changes to forestry policies are less clear, however: reducing the number of timber sales contracts would be cost-beneficial, but replacing commercial timber with carbon concessions is more marginal.

Denmark’s successful shift from fossil fuel dependency to being a world leader in renewable energies has rightly gained international plaudits. Rather less is known about the role of the state and the growth of cooperative and often innovative forms of public ownership in facilitating this process. This flies in the face of dominant neoliberal practices of governance and highlights the potential and even essential role that forms of economic democracy can play in developing an alternative pathway towards low carbon transition. The chapter reflects on both the opportunities but also the tensions involved in development such alternatives.

China’s energy challenges are shaping the way its leadership is approaching climate mitigation at the domestic level, which in turn is shaping its positioning in international climate negotiations. An increase in the scientific and technical understanding of its own energy and emissions situation—an understanding promoted in part by increased international engagement—has permitted China’s policy makers to legislate with more confidence domestically. Low carbon development is now positioned at the core of China’s overarching national five-year economic plans with carbon management programs existing alongside a low carbon development strategy. These significant domestic changes have permitted an equally striking shift in China’s approach to global environmental diplomacy, particularly in the context of the international climate change negotiations.

The concept of environmental justice came relatively recently to the Republic of Korea (henceforth, South Korea), developing out of mainstream environmentalism, which began in the 1980s. Unlike environmentalism in Europe and the US, which initially focused on the preservation of ecosystems, however, South Korea’s early environmentalism was concerned with the impact of pollution on human health. This initial recognition of the importance of the environment for humans made it easy to begin to think about environmental justice issues. In 1999, a landmark moment for environmental justice in South Korea occurred with the first Environmental Justice Forum, organised by the Citizens Movement for Environmental Justice, now one of the largest and fastest-growing environmental organisations in the country. The Forum reported that rural regions frequently experienced environmental injustice in the form of a lack of sanitation and improved drinking water, as well as the increased siting of contaminating facilities in or near their communities. This chapter outlines the current substantive, distributional and procedural aspects of environmental justice in South Korea.

This chapter examines China's rapid rise in the global wind power industry, despite the fact that the nation is the largest emitter of greenhouse gases and the world's single largest source of emissions. It briefly looks into how China is now succeeding at green innovation rather than just replicating technologies from elsewhere and manufacturing them inexpensively. China's emergence as a green energy leader comes at a time when energy is the topmost concern of most national security agendas, and when climate change is being linked to extreme weather events and disasters. Given global concern about the impact of China's rapidly increasing energy needs on global supplies and its ability almost singlehandedly to change the global climate system, it is worthwhile to understand how and why Beijing has embraced green innovation, which could play a crucial role in the global transition to a low-carbon economy.