Economics, emissions scenarios and the work of the IPCC

This article restates and extends our critique of the economic and statistical work of the Intergovernmental Panel on Climate Change (IPCC), including in particular the Special Report on Emissions Scenarios (SRES). We respond to the article in the previous issue of Energy and Environment, in which 15 authors associated with the SRES argued against the case we had made there. We give reasons for rejecting their view that market exchange rates (MERs) should be used in deriving cross-country measures of economic growth, and note that in its handling of this and related issues they and others involved in the IPCC process are not professionally representative. We show how the mistaken use of MER-based comparisons, together with questionable assumptions about 'closing the gap' between rich countries and poor, have imparted an upward bias to projections of economic growth in developing countries, and hence to projections of total world emissions. We list actions that could be taken now, in the context of the IPCC's Fourth Assessment Review which is about to be launched, to set the economic and statistical aspects of the Review on a sounder basis. We argue that it is high time for ministries of economics and finance to inform themselves about the IPCC process and to become involved in it.