Cost - the cost of meeting carbon budgets

In December 2008, the Committee estimated that the cost of meeting carbon budgets in 2050 to be between 1-2% of GDP, and in 2020 the cost will be less than 1% of GDP.

Although GDP in 2020 is now expected to be lower as a result of the recession, we still expect the cost of meeting our budgets to be less than 1% of GDP.

This roughly equates to a cost to the average person in the UK of less than £240 a year in 2020. The Committee argues that this is a cost that should be accepted given the costs and consequences associated with dangerous climate change.

Lord Nicholas Stern’s review into the Economics of Climate Change advised that if climate change was not tackled it could cost 5-10% of GDP by the end of the century. 

Meeting carbon budgets and building a low-carbon economy also presents the UK with significant economic opportunities as well as challenges.