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How should politicians prioritize between robust economic growth and solving the problem of climate change?

A new report reveals an encouraging answer: There’s no need to choose. Better Growth, Better Climate, finds that low-carbon investments—if done right—could cost about the same as conventional infrastructure, but would deliver significantly greater economic, social, and environmental benefits in the long-run.

The shale gas revolution, which began nearly 10 years ago in the United States, is poised to spread across the globe. For many countries, shale gas could strengthen energy security while cutting emissions.

But unlocking this massive resource comes with a significant environmental risk: access to freshwater for drinking, agriculture, and industrial use.

Dozens of countries are deciding whether or not to develop their shale gas and tight oil resources in order to reduce emissions, create new jobs, and increase national energy supplies. However, extracting natural gas and tight oil from shale poses water risk.

We analyzed water stress levels in the 20 countries with the largest shale gas and tight oil resources, and found that 40 percent face high water stress.

Christine Lagarde, Managing Director of the IMF, recently launched the latest book in a series on what good fiscal policy should look like in a world of environmental externalities.

The message was clear: Ministers of finance and economics should design their tax systems skillfully so as to tax bad things, like pollution and congestion, rather than good things like work and profit. Not to do so is plain, bad economics.

A new report from the International Monetary Fund (IMF), Getting Energy Prices Right: From Principle to Practice, argues that the costs of coal, natural gas, gasoline, and diesel fail to account for these fuels’ environmental and social impacts—such as greenhouse gas emissions, air pollution, and traffic deaths.

Setting prices that reflect these side effects—through taxes, licensing, or cap-and-trade systems—could reduce deaths from fossil fuel-related air pollution by 63 percent, decrease global carbon dioxide emissions by 23 percent, and generate revenues totaling about 2.6 percent of global GDP.


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