World energy future: the demand side challenge

Non-OECD countries will account for the greatest share of growth in future energy demand. Policy-makers, in response to public concern that the continued use of fossil-fuels could bring about global climate change have sought out policies which will reduce future energy demand. However, economic instruments which can do so, such as carbon taxes, provoke significant distributional and equity issues. Most OECD governments have set CO₂ reduction targets, but few of those targets are backed up by effective legislation and programmes. Instead, most governments seem to count on increasing energy efficiency, seemingly 'spontaneously', to bring about CO₂ reductions. Realization of OECD CO₂ reduction targets would be insignificant on a global scale, but they are nevertheless very ambitious when compared to recent changes in the OECD's energy-derived CO₂ emissions. Reliance on market forces alone may therefore not be enough.