Economic growth and development with low-carbon energy

Energy is needed for economic growth, and access to cheap, reliable energy is an essential development objective. Historically most incremental energy demand has been met through fossil fuels, however in future that energy will have to be low-carbon and ultimately zero-carbon. Decarbonisation can and needs to happen at varying speeds in all countries, depending on national circumstances. This paper reviews the implications of a transition to low-carbon energy on economic growth and development in current low income countries. It sets out empirical findings about trajectories for energy intensity and emissions intensity of economic growth; explores pathways to accelerate decarbonisation; reviews the theoretical and empirical literature on economic costs and co-benefits of energy decarbonisation; and assesses analytical approaches. It discusses the opportunities that might arise in terms of a cleaner, more dynamic and more sustainable growth model, and the options for developing countries to implement a less carbon intensive model of economic development.

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