Economics of Environment and Energy Essay Example | Topics and Well Written Essays - 3000 words

Economics of Environment and Energy - Essay Example This applies especially to those who only view environmental concerns, as anti-economic Transitioning to a low carbon economy is indispensable if the world is to continue uninterrupted by environmental degradation. Researchers have made a prediction that continued greenhouse gas emissions would result in a rise of temperature by 6Â °C before 22nd century. This temperature rise will result in problems such as drought and floods, global instability, public health related deaths and rampant migrations of people. All these problems will befall the world community including the UK. For the world to avoid these disastrous effects, global carbon dioxide emissions must fall to at least 50% below the levels of 1990 by the year 2050 (DECC, 2011,pp 3). This will ensure that world temperatures will not rise more than 2Â °C. In some past UN talks, the European Union promised to cut carbon dioxide emissions to 20% below the levels of 1990 by the year 2020. To reduce carbon dioxide emissions and fund emissions cuts in developing countries, the European Union has created the world’s largest emissions scheme (Leticia et al, 2012). The transition to reduce carbon dioxide emissions will happen but not without challenges. The UK will face the challenge of getting alternative energy sources that are environmentally friendly to run industries. Climate change needs urgent solutions to prevent ecological catastrophes, political and economic instability, and human suffering. According to Lund (2009, p.88), efforts to minimize greenhouse gas emissions will provide international security and improve energy, new economic opportunities, a fair society and a better environment. This paper will deal with energy consumption trends and prices in the UK, role of competitive markets in delivering the low carbon economy and government’s intervention in fostering the economy. The trends in energy consumption and prices have been on the rise in the whole world with the challenges of employing the use of environmentally sources of energy. Energy production of 2010 was down by 5.3% compared to the 2009 production in the United Kingdom (DECC, 2012, pp 2). Energy consumption normally becomes high during cold seasons, and thus in a cold year we expect a rise in energy consumption. This happens because people use lots of energy to keep warm their dwellings during cold times. In 2010, the final energy consumption rose by 4.4% while primary consumption of energy was up by 3.2%. However, the primary consumption on the temperature-adjusted basis fell down by 0.4 per cent. This happened because the average temperatures of the year 2010 were 1.1Â °C below those of 2009. The year 2010 saw the UK remaining a net energy importer, importing 28 per cent of its energy requirement. Because of reduced nuclear output due to outages, imports of liquefied natural gas increased. The tables below show the final energy consumption in the year 2010. By users Sector Percentage Transport 35.0 Domestic 30.5 Non-energy use 5.5 Iron and steel industry 1.0 Other industries 16.5 Other final users 11.5 By fuels Type of fuel Percentage consumption Natural gas 33.0 Electricity 17.5 Petroleum 45.5 Others 4.0 The final total energy consumption was 159.1 million tones of oil equivalent. From the tables, we can see that UK had increased dependency on fossil fuels, and the transport sector was the leading consumer of total energy consumption. In the fourth quarter of 2011, total energy production fell by 13% as compared to the productions in the