

The Turanor PlanetSolar, the world's largest solar-powered boat, plies the Venetian Lagoon in Venice earlier this month. A new report argues that climate-related technological innovation could spur an economic renaissance.

Despite all the scary predictions of rising seas and global warming, politicians in the United States at least have been reluctant to take serious action to reduce greenhouse gases. Reasonably sensible ideas like taxing carbon emissions -- an idea with bipartisan intellectual support -- are routinely dismissed out of hand as being bad for the economy.

But it doesn't have to be that way, according to a new report out in advance of next week's United Nations summit on climate change. The report argues that governments could significantly slow emissions and boost economic growth simply by making smart decisions about how they spend money they're going to spend anyway.

The nut of the argument is this: Over the next 15 years, as population grows and cities expand, the world will spend $90 trillion on urban development, land use and energy systems -- the very areas where carbon emissions are concentrated. That money does not have to be spent on business as usual. Instead, it could support a low-carbon future. The report says:

This would mean building more compact, connected, coordinated cities rather than continuing with unmanaged sprawl; restoring degraded land and making agriculture more productive rather than continuing deforestation; scaling up renewable energy sources rather than continued dependence on fossil fuels.

Such an approach would not only reduce global warming, it could also provide the technological spark to ignite global economic growth:

A central insight of this report is that many of the policy and institutional reforms needed to revitalise growth and improve well-being over the next 15 years can also help reduce climate risk. In most economies, there are a range of market, government and policy failures that can be corrected, as well as new technologies, business models and other options that countries at various stages of development can use to improve economic performance and climate outcomes together.

These opportunities, the report says, require new policies in three key areas:

1. An end to fossil fuel subsidies, imposition of new taxes on carbon and the adoption of new rules to encourage the growth of renewable energy, such as wind and solar.

2. Financial innovations to encourage governments and the private sector to invest in badly needed upgrades of public infrastructure, which are likely to be more energy-efficient. And

3. More support for low-carbon innovators, including strong patent protections and more public spending on research and development.

"With the right signals to the market, we can get important outcomes without the climate risk," said Felipe Calderone, the former president of Mexico and the chair of the Global Commission on the Economy and Climate, which was formed by seven countries -- Colombia, Ethiopia, Indonesia, Norway, South Korea, Sweden and the United Kingdom -- to help governments, businesses and society make better-informed decisions. "Certainty about these policies could provide clear economic incentives to take the right path."

Read the full report, set for release Tuesday morning in New York, here.