Equity implications of net zero visions

Abstract

With national governments almost universally pledging to achieve net zero emissions, a key uncertainty is how net zero policies will affect global equity. It is unclear which policy measures are available for achieving net zero equitably, what the social and environmental implications of these measures will be under global pathways, or how they might be implemented in ways that advance rather than undermine equity. By means of three stylized future pathways, we show that there are potentially serious international and domestic equity effects from global net zero policies, as well as opportunities to achieve an equitable net zero future for all through appropriate policy design.

Full text

Vol.:(0123456789)
Climatic Change (2021) 169:20
https://doi.org/10.1007/s10584-021-03270-2
1 3
ESSAY
Equity implications ofnet zero visions
DominicLenzi1 · MichaelJakob1· MatthiasHonegger2· SuzanneDroege3·
JenniferC.Heyward4· TimKruger5
Received: 1 February 2021 / Accepted: 10 November 2021
© The Author(s), under exclusive licence to Springer Nature B.V. 2021
Abstract
With national governments almost universally pledgingto achieve net zero emissions,a
key uncertainty is how net zero policieswill affect global equity. It is unclear which policy
measures are available for achieving net zero equitably, what the social and environmen-
tal implications of these measures will be under global pathways, or how they might be
implemented in ways that advance rather than undermine equity. By means of three styl-
ized future pathways, we show that there are potentially serious international and domestic
equity effects from global net zero policies, as well as opportunities to achieve an equitable
net zero future for all through appropriate policy design.
Keywords Equity· Net zero· Justice· Border carbonadjustments· Carbon dioxide
removal· International transfers
* Dominic Lenzi
d.s.lenzi@utwente.nl
Michael Jakob
Jakob@mcc-berlin.net
Matthias Honegger
honegger@perspectives.cc
Suzanne Droege
susanne.droege@swp-berlin.org
Jennifer C. Heyward
jennifer.c.heyward@uit.no
Tim Kruger
tim.kruger@oxfordmartin.ox.ac.uk
1 University ofTwente, Enschede, TheNetherlands
2 Institute forAdvanced Sustainability Studies, Potsdam, Germany
3 Stiftung Wissenschaft Und Politik, Berlin, Germany
4 Arctic University ofTromso, Tromso, Norway
5 Oxford Geoengineering Programme, University ofOxford, Oxford, UK

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1 Introduction
With the latest IPCC report issuing a “code red to humanity” (Guterres 2021), COP26
saw national governments almost universally pledge to achieve net zero emissions. The
IEA optimistically interprets these pledges to result in 1.8C° by the century’s end, although
other calculations suggest the resulting warming to be 2.4C°.1 At the time of writing, one
hundred and thirty six countries have net zero pledges, accounting for 90% of world GDP.
However, these pledges differ substantially in ambition and credibility. Among current
pledges, 55% of countries have committed to achieve net zero after 2050, 44% by 2041-
2050, while only1% aim for net zero by 2030 and 0.3% by 2031-41. Nearly all current
pledges lack important policy details (Rogelj etal. 2021), obscuring potentially significant
differences in ambition (Honegger etal. 2021a, b). Yet some differences are already evi-
dent, as the EU27 has committed to the more demandingnet zero greenhouse gas emis-
sions by 2050, while other countries merely pledge net zero CO2 emissions.2 The level
of official commitment also variessignificantly, ranging from legally binding pledges to
merely active discussion.3
A key uncertainty is how net zero pledges will affect global equity. Equity is a key ele-
ment of the UNFCCC (Article 3.1), and is codified in the principle of Common But Dif-
ferentiated Responsibilities and Respective Capacities (CBDR&RC). The Paris Agreement
reaffirmed equity as a guiding rule for international climate policy cooperation (Article 4.1
Paris Agreement) among its parties. This refers to sharing efforts and burdens of climate
policy action among countries. The climate regime rests upon three pillars of equity: (i) the
protection of vulnerable populations, (ii) ensuring sustainable development and (iii) raising
ambition especially in countries which have larger responsibility for historical emissions
and a greater capacity to act (Dooley etal. 2021). However, the apparent rush to commit to
net zero has largely ignored how decarbonization policies affect equity.
How countries interpret equity remains fraught with political expediency. Both the
overall allocation of carbon budgets between nations and the measures taken to implement
them can be inequitable. The bottom-up structure of the Paris Agreement provides lati-
tude for countries to interpret equity in light of national circumstances, which may be both
an opportunity and a challenge in view of long-standing disagreements about historical
responsibility (Rajamani 2016). The Polluter Pays Principle (PPP) holds that developing
countries have typically made much smaller contributions to cumulative CO2 emissions,
and so should bear less responsibility for addressing climate change. A rival principle, the
Ability to Pay Principle (APP), considers differences in current wealth and capabilities to
invest in decarbonization, but does not relate these differences to historical emissions. Both
principles are widely considered to be components of the CBDR&RC (Hayward 2012).
Developing countries, including emerging economies with a high share in current emis-
sions like China, have emphasized the PPP in negotiations, but as high-income countries
1 https:// www. iea. org/ comme ntari es/ cop26- clima te- pledg es- could- help- limit- global- warmi ng- to-1- 8-c- but-
imple menti ng- them- will- be- the- key;https:// clima teact iontr acker. org/ global/ tempe ratur es/
2 This difference in ambition shifts the net zero milestone by at least a decade - a fact which appears absent
from public discourse to date.
3 According to the Net Zero Tracker data,the level of officialcommitment ranges from being enshrined in
law (13 countries), legislation under consideration (3 countries), in an official policy document (53 coun-
tries), or in active discussion (76 countries).

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largely got their way in avoiding quantitative emission reduction commitments under the
Paris Agreement (Clémençon 2016), the ‘no fault’ APP gained greater acceptance.
Even if these principles were endorsed, policymakers may still lack guidance about
how to determine their fair share, while publics may lack the tools to judge fair contribu-
tions. For example, commonly used equal per capita approaches fail to recognize the dif-
ferent capabilities of states and their respective historical emissions, while ‘grandfathering’
approaches that allocate emissions quotas based on historical emissions are incompatible
with the protection of the vulnerable, or with ensuring equitable opportunities for sustain-
able development (Dooley etal. 2021; Kartha etal. 2018).
As national governments pursue net zero, it is unclear which policy measures could
achieve this equitably. As such, this essay utilizes three stylized future pathways to conduct
a thought experiment about net zero CO2 and equity.4 We highlight some potentially seri-
ous equity concerns from net zero policies, as well as opportunities to achieve an equitable
future through appropriate policy design.
2 Equity implications ofthree possible measures forachieving net
zero
Climate mitigation affects equity in both desirable and undesirable ways, not all of which
can be anticipated. As a heuristic, we can divide equity concerns into two broad categories.
It would be highly inequitable to allow climate change to continue unchecked due to the
projected impacts on peoples’ lives, especially in developing countries. Remaining within
the carbon budget for ‘well below’ 2°C, and attempting to limit warming to 1.5°C, is itself
a necessary condition for an equitable future. This requires lowering global net CO2 emis-
sions to zero within decades (IPCC 2018). If any measure fails to reduce emissions, there
are equity-based reasons not to pursue it, especially when alternatives are available. We
call these ‘target-based equity concerns’.
The second category focuses upon the social, economic and environmental harms that
may arise in meeting climate targets, and how these are distributed. Since the climate
effects of emissions are independent of where emissions are released, there are in principle
unlimited ways to divide the efforts and costs of mitigation across regions and time. This
provides some degree of latitude in the choice of policy instruments. Pathways optimized
for economic efficiency respond to regional mitigation costs, implying that more mitigation
would be carried out in countries that are able to achieve low-cost emission reductions.
In addition to economic efficiency, responsibility for mitigation should be determined in
accordance with the CBDR&RC. As such, it would be inequitable for those already dis-
advantaged to incur greater losses and disruptions due to the implementation of climate-
friendly measures, especially if their emissions record is also relatively low. We call this
second category ‘side effect-based equity concerns’.5 Climate mitigation policies also raise
questions of political feasibility. Some of these may arise from naked realpolitik, but in
some cases, feasibility and equity may be linked, such as when the perceived unfairness of
a policy measure sparks a political backlash.
4 Future work could compare the equity implications of scenarios for net zero CO2 against net zero GHGs.
5 These two categories are inspired by but differ slightlyfrom Caney’s (2014) distinction between “harm
avoidance justice” and “burden-sharing justice”.

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We examine the equity implications of three policy options that are gaining prominence
against the backdrop of net zero targets, namely border carbon adjustments (BCA), inter-
national financial transfers from developed to developing countries and carbon dioxide
removal techniques (CDR). Section3 then examines the contribution of these measures
under our global pathways. In what follows, BCA is understood as a national policy meas-
ure imposed on foreign production, while CDR can be undertaken at several political lev-
els, and can have local, regional and international effects.
2.1 Carbon pricing andborder carbon adjustments
The greenhouse gas intensity of an economy, measured in emissions per unit of GDP, tends
to be higher for developing countries given their larger reliance on primary production
with less efficient technologies, compared to the stronger service-economies of developed
countries.6 For this reason, the application of a carbon price on energy-intensive indus-
tries from developing countries in general impairs their competitiveness more severely than
similar industries in developed countries (Ward etal. 2019). Following the CBDR&RC,
a number of developed countries are implementing reduction targets, albeit with different
levels of ambition. When introducing CO2 pricing and strict pollution standards, there is a
risk of policy-induced carbon leakage as economic activities are outsourced to countries
with laxer climate policy measures. This compromises the effectiveness of the policy, as
emission sources move abroad and improve the overall national balance of emissions, leav-
ing the global situation unchanged (a target-based equity concern).
There are ways to address carbon leakage, such as relocating production to countries
with or without a CO2 price (a side effect-based equity concern). Previously in the EU,
free allocation of emission allowances under the EU ETS and ex-post compensation were
preferred. With the European Green Deal, however, a more ambitious 2030 target and a
commitment to climate neutrality by 2050, the pressure is mounting to introduce BCAs.
Indeed, the EU’s ‘Fit for 55’ legislative package includes plans for a ‘carbon border adjust-
ment mechanism’ (CBAM) to avoid carbon leakage. The CBAM aims to introduce a car-
bon price on imported goods from energy-intensive industries from 2026 on (European
Commission 2021). This will lead to changes in export performance and income, espe-
cially once the CBAM fully substitutes the free allocation of emission certificates (this is
already envisaged to prevent carbon leakage from 2036). Output-based free allocation and
industry exemptions from carbon pricing can perform better regarding international equity
effects than a BCA, yet these measures are less effective against carbon leakage (Böhringer
et al. 2012). If a unilateral BCA poses an economic burden on developing countries by
charging their products for carbon content, this would run counter to the CBDR&RC. This
unfairness could be reduced through financial transfers and capacity building to aid sec-
toral decarbonization (Cosbey etal. 2012)—or through a climate policy adjustment in the
developing countries, such as introduction of a carbon price (with distributional effects
then occurring at the domestic level). Thus, the unilateral application of BCA against leak-
age can create something of a paradox: if a developed country follows an ambitious climate
6 We refer to ‘developed’ and ‘developing’ countries following the UNFCCC. We also take into account
that in the spirit of Paris Agreement, developed countries are obliged to lead mitigation and climate finance,
while emerging economies are invited to contribute on a voluntary basis. Thus, the dichotomy between
Annex I and Non-Annex I countries is not the only reference point for the CBDR&RC.

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policy in order to meet the CBDR&RC principle, it could undermine equitable interna-
tional effort sharing despite attempting to safeguard domestic mitigation.
The application of a BCA on imports by more than one developed country or region
could extend international distributional impacts. Countries applying a BCA could do so
in cooperation and exempt each other from any adjustments of prices at the border. This
would create a common CO2 pricing space with an external BCA. The impact on third
countries that trade with such a ‘border carbon club’ would be higher than if only one
country applied a BCA, because a larger share of their exports would be covered by a car-
bon price at the border. An import-only BCA system, be it a stand-alone or a multi-country
approach, would thusneed to be embedded in international negotiations concerning unde-
sired equity effects from a shift in trade revenues and from terms of trade effects. As such,
the transfer of BCA revenues to foster decarbonization in developing countries should be
part of any BCA scheme. Countries imposing a BCA on imports need to investigatethe
trade-offs between efficiency in tackling leakage and equitable sharing of the costs of
decarbonization. In orderthat a BCA on imports becomes redundant over time, it is neces-
sary to assist countries of origin in the decarbonization of affected sectors.
Without careful policy design, there is the potential for adverse effects on developing
countries that would violate the principles of climate justice introduced above. Consider
the PPP first. Developing countries have typically made much smaller contributions to
cumulative CO2 emissions, while most countries that have already committed to net zero
have large historical contributions to climate change. In a BCA, an indiscriminate imposi-
tion of carbon prices at the border would shift some of the costs of decarbonization from
those most historically responsible to those least responsible, which is contrary to the PPP.
However, indiscriminate application of carbon tariffs would also violate the APP, since
shifting some of the costs of decarbonization onto developing countries would ignore rele-
vant differences in respective capacities. As such, the potentially regressive effects of BCA
for imports should be examined when developing detailed net zero policies. For instance,
it is a common practice in international trade relations to grant special treatment to ‘Least
Developed Countries’ (LDCs) (Mehling etal. 2019). As a starting point, BCA schemes
such as the EU CBAM should exempt imports from (LDCs), or apply de minimis rules
(Cosbey etal. 2012; Dröge and Fischer 2020).
2.2 Financial transfers formitigation results
Financial transfers from developed to developing countries—whether by climate finance
or carbon market transactions—have great potential to promote an economically efficient
and equitable net zero future. In theory, economic efficiency and equity expectations can be
aligned through financial transfers, i.e. payments from countries with greater responsibility
to mitigate climate change and higher mitigation costs to those with less responsibility but
lower costs (Honegger and Reiner 2018). Financial transfers are thus a key way of ensuring
that developing countries do not bear the costs of combatting climate change in general,
and also from effects of BCAs or from Carbon Dioxide Removal (CDR) (see below).
However, both target and side effect equity concerns remain. In terms of target-based
equity, it should be noted that to reach global net zero emissions, all countries must do
far more, albeit at a pace reflecting their different starting points (Fyson etal. 2020). Over
time, carbon market transfers may need to prioritize CDR as more countries approach net
zero CO2 and thus cannot achieve further emissions reductions through emissions trading

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(Honegger et al. 2021a, 2021b). Yet without a sustained rise in ambition, such market-
based transfers would not lead to an equitable net zero future.
In terms of equity with respect toside effects,large-scale financial transfers can have
adverse macroeconomic effects (Jakob et al. 2015), e.g. currency appreciation, which
would harm the export sector in the short term. If transfers vary over time, volatility can
negatively affect the investment climate and hence delay economic development (van der
Ploeg 2011). The prospect of deriving substantial revenues from international funding
sources for emissions reduction creates incentives to inflate baseline emissions, in order
to obtain funding for projects that would have been undertaken anyway. Such ‘windfall
profits’ could even promote corruption. As these are likely to affectdeveloping countries,
they are highly problematic from the standpoint of equity, contravening both the APP and
the PPP.
Financial transfers may also face feasibility constraints, whether these apply to donors,
intermediaries and recipients. ‘Transfer aversion’ among donors,e.g. low public accept-
ance of sending money abroad, can severely limit volumes of financial support offered by
developed countries for **decarbonization in developing countries. Even countries that
have offered large volumes of climate finance have sometimes struggled to deliver such
transfers. Thus, a welcome outcome of COP26 was the agreement by developed coun-
tries to double their climate finance contributions, while aiming to reach the previously
agreed-upon target of $100 billion climate finance as soon as possible. Policy makers
might increase the political feasibility of mitigation policies by deviating from the most
efficient outcomes by providing some transfers while also engaging in additional mitigation
at higher costs domestically (Bauer etal. 2020). Recipient countries might also be hesi-
tant to transform their energy system despite international funding, due to (i) the political
power of domestic fossil fuel suppliers, (ii) the cultural perception that fossil fuels promote
industrialization and (iii) concerns that renewable energy might not scale up fast enough to
meet energy demand.
2.3 Carbon dioxide removal
CDR has become central to net zero ambitions, although this is rarely made explicit in
policy plans (Fuss etal. 2020). Bioenergy with Carbon Capture and Storage (BECCS) is
the most prominently discussed CDR technique; others include Afforestation and Refor-
estation, Direct Air Capture, Enhanced Weathering and Soil Carbon. CDR has the poten-
tial to either achieve or undermine equitable net zero outcomes. In models, CDR allows
more stringent warming targets to be achieved if less short-term mitigation occurs, as a
period of emissions ‘overshooting’ is corrected by sustained carbon removal in the second
half of the century. The ambition of reaching net zero by 2050 and limiting warming to
1.5°C by 2100, coupled with the slowness of existing decarbonization, implies a drasti-
cally larger demand for CDR compared to a 2°C target (Michaelowa etal. 2018). Indeed,
the IPCC Special Report on 1.5°C did not include any mitigation scenarios compatible
with 1.5°C that excluded all forms of CDR (IPCC 2018), although CDR was limited in
some scenarios.
A lower temperature target combined with overshooting could result in more benign cli-
mate conditions for future generations and alleviate the pressure for immediate decarboni-
zation. At least in theory, this would ease the costs of transitioning to a low-carbon econ-
omy for both developing and developed countries. If undertaken by developed countries,

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the use of CDR could even enable the strictest interpretation of the PPP, namely that early
industrializing countries remove their historical emissions. Early industrializers such as the
EU members and USA have roughly doubled the share of cumulative emissions compared
to current emissions. As the rise in global temperatures is approximately proportional to
cumulative emissions (Allen etal. 2009), true climate neutrality would require not only
achieving net zero CO2 but removing their share of cumulative emissions. CDR therefore
offers a way for early industrializers to reduce their historical responsibility by removing as
much atmospheric CO2 as they have ever produced.7
However, CDR faces target-based and side effect-based equity concerns, as well as
questions of political feasibility. Indeed, there are three different target-based equity con-
cerns. First, pathways featuring extreme overshooting of a desired GHG concentration and
subsequent reliance on CDR to bring it back down would create serious climatic risks,
as the carbon dioxide will have some warming effect while it is in the atmosphere. Sec-
ond, the projected availability of CDR in mitigation models may encourage further delay in
reducing emissions (the so-called moral hazard) (Anderson and Peters 2016; Shue 2017).
Finally, any policy failure of large-scale CDR would dramatically exacerbate the mitigation
challenge and likely climate impacts.
CDR also raises many side effect-based equity concerns, although these vary accord-
ing depending on the technique chosen and the context of implementation (Lenzi 2018).
For example, deploying CDR following a purely cost-optimization approach could dis-
proportionately affect people in developing countries. Removing 10 Gt CO2 annually via
BECCS would require a ten-fold increase in power from burning biomass (Honegger and
Reiner 2018), which implies a huge increase in biomass production. An even larger scale-
up of biomass would be required if biomass power or waste incineration plants were not
equipped with CCS (Rogelj etal. 2018). Depending on the success of near-term emissions
cuts and the deployment of other forms of CDR, limiting warming to well below 2°C may
require even larger quantities of biomass, much of which seems likely to be produced in
the South, increasing the risk of unfair and unsustainable demands upon land and water
(Anderson and Peters 2016). Although countries richly endowed with fertile land could
benefit from the increased demand for biomass, overreliance on biomass could negatively
affect biodiversity and food security, and could even have detrimental climate effects as
forests are felled for bioenergy crops (Creutzig et al. 2015). Negative side effects would
then arise for third parties regardless of where CDR is undertaken or who bears the costs.8
Relying on the promise of CDR without investing in it would shift a substantial pro-
portion of the economic costs of mitigation onto future generations (Fuss etal. 2014). If
coupled with slow mitigation, future generations could face the prospect of heavy reliance
on CDR, with its adverse side effects, or abandoning the Paris climate stabilization target
(Shue 2018; Lenzi 2021). The viability of equitable and effective CDR implementation
thus appears contingent on immediate, credible steps to ensure the real-world feasibility
of CDR, while accelerating deep decarbonization. While the long-term political feasibility
of CDR cannot be ascertained, mobilizing political will and enabling careful policy design
would require public engagement about when, where and how particular techniques are
implemented. However, existing policy assessments of CDR, including those conducted by
7 See https:// theco nvers ation. com/ after- net- zero- we- will- need- to- go- much- furth er- and- clean- up- histo ric-
emiss ions- 162332.
8 In our stylized pathways, we depict the share of CDR undertaken by OECD and non-OECD countries
based on the equity principle of cumulative historic emissions, as reported in Fyson etal. (2020).

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the IPCC (see IPCC 2018, Ch. 4), often ignore questions of equity as well as the need for
public input (Lenzi and Kowarsch (forthcoming).
3 Equity implications ofthree pathways tonet zero
Model-based analyses, summarized in IPCC (2018), have considered different aspects of
equity, such as the trade-off between cost-efficient emission reductions and the fair distri-
bution of mitigation costs and the adverse side effects of biomass use. Our analysis extends
this literature by comparing the equity implications of different approaches to reduce
2020 2030 2040 2050 2060 2070 2080 2090 2100
Annual Emissions
OECD non-OECD
Fig. 1 The All-in pathway, in which all countries achieve to net zero by 2050
2020 2030 2040 2050 2060 2070 2080 2090 2100
Annual Emissions
OECD non-OECD
Fig. 2 Industrialized-2030 pathway, wherein OECD countries reach net zero before 2050, and non-OECD
after 2050

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emissions in line with net zero targets. To explore the possibilities open to policymakers to
achieve an equitable global net zero, we consider three stylized global mitigation pathways.
Each of these pathways corresponds to cumulative emissions over the course of the century
that could allow remaining below 1.5°C of global warming (see Figs.1, 2 and 3)9:
1. All-in 2050 pathway—all countries achieve net zero CO2 emissions by 2050.
2. Industrialized-2030 pathway—the 38 developed countries of the OECD reach net zero
CO2 emissions well before 2050 (i.e. around 2030), allowing developing countries more
time to reach net zero.
3. Industrialized-2050 pathway—the 38 developed countries of the OECD achieve net zero
CO2 emissions by 2050, non-OECD countries later, anticipating very large CDR usage
to return atmospheric CO2 concentrations post-2050.
These three pathways are of a highly stylized nature and are not intended to be exhaus-
tive. Indeed, there are in principle any number of pathways within and outside of the range
presented here. Rather than depicting concrete transformation scenarios for net zero,10 our
pathways enable exploration of the equity implications of CDR, BCA and financial trans-
fers under three possible mitigation futures.
2020 2030 2040 2050 2060 2070 2080 2090 2100
Annual Emissions
OECD non-OECD
Fig. 3 The Industrialized-2050 pathway, where OECD countries reach net zero by 2050, and non-OECD
later
9 We focus on CO2 emissions alone. All pathways result in cumulative emissions of 525 GtCO2 over the
course of the century, which is close to the budget to stay below warming of 1.5°C with a probability of
50% (see TableA1 in the Appendix). These pathways serve to illustrate different possibilities for remaining
within a given cumulative emissions budget by 2100.
10 For such quantified scenarios, see Rogelj etal. (2018).

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3.1 The All‑in pathway
The All-in pathway sees all countries bring net CO2 emissions to zero by 2050. As such,
itwould be furthest from current net zero commitments. While the All-in pathway could
be seen as an unfair burden on LDCs unless accompanied by substantial financial transfers,
it implies the lowest likelihood of developed countries charging border carbon adjustments
on imports because all countries move rapidly toward decarbonization. To the extent that
this pathway includes globally comparable levels of policy ambition, carbon leakage would
be a lesser concern compared to the other pathways. In this pathway, energy price differ-
entials would be lower than insituations in which the envisaged date of achieving net zero
differs across regions. Moreover, international cooperation, e.g. in terms of financial and
technology support for key sectors, would be required to achieve rapid decarbonization in
developing economies, which would also reduce the necessity of BCAs. Nonetheless, even
in this pathway, there may be a period of BCAs until all economies achieve net zero.
The All-in pathway features no period of ‘overshooting’, which entails a much lower
reliance on CDR compared to the other pathways. Together with the previous point, this
implies that target-based equity concerns are therefore relatively limited in the All-in path-
way. At the same time, the ambition of this pathway is likely to require fundamental life-
style changes in consumption behaviour particularly in developed countries and avoid lock-
ing in high-consumption lifestyles in the emerging economies (van Vuuren etal. 2018).
The pathway also imposes significant costs upon both developed and developing coun-
tries associated with the early retirement of fossil infrastructure. To ameliorate side effect-
based equity concerns, the All-in pathway requires substantial international financial trans-
fers to deploy mitigation technologies in developing countries, lest they bear the costs.
With appropriate transfers, this pathway would most closely accord with the three pillars
of equity recognized in the Paris Agreement, i.e. protecting the vulnerable, ensuring oppor-
tunities for sustainable development and appropriate effort sharing reflecting the relative
wealth and historical responsibilities of countries (CBDR&RC).
While costs for developed countries appear manageable (at least compared to other tem-
poral distributions of mitigation efforts which still achieve the Paris temperature objective),
the All-in pathway nonetheless depends on unprecedented volumes of international trans-
fers, and very high transition costs for developing countries. However, in the short term,
these efforts compete for scarce resources needed for other sustainable development objec-
tives such as poverty alleviation, industrial development and many others. The All-in path-
way appears to be closely in line with Shue’s (2019) suggestion that rather than allocat-
ing fossil fuel-based emissions quotas for development and poverty alleviation, developed
countries should offer technology and financing to avoid locking in carbon infrastructure in
developing countries. The All-in pathway therefore depends upon overcoming barriers to
substantial international financial transfers, such as ‘transfer aversion’, and building gov-
ernance capabilities in recipient countries.
3.2 The Industrialized‑2030 pathway
Should non-OECD countries not achieve the dramatic transformation implied by the All-In
pathway, developed countries would have to achieve net zero emissions earlier than devel-
oping countries. This Industrialized pathway reflects the older equity argument in favour
of what became known as ‘subsistence emissions’: protecting a certain level of emissions

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to ensure that the poorest were not unfairly burdened by mitigation efforts.11 In terms of
historical responsibility, the Industrialized-2030 pathway also reflects the PPP, because
wealthy historical emitters would lead decarbonization efforts. However, the greater bur-
dens upon developed countries’ domestic mitigation would imply comparatively more side
effect-based equity concerns, firstly for vulnerable domestic populations, and secondly,
from the international effects of high carbon pricing and corresponding BCA. Pronounced
differences in mitigation ambition reflected in carbon pricing could also raise the risk of
carbon leakage, and increase demands for substantial carbon tariffs. High levels of import
BCA could substantially harm industries in exporting countries, and could be expected to
create political opposition.
Compared to the All-in pathway, the Industrialized-2030 pathway features greater reli-
ance upon CDR to compensate for ‘overshooting’ emissions trajectories, featuring net neg-
ative global emissions from around 2070. Such reliance on CDR implies comparatively
greater risks of target-based equity concerns, such as more serious climate impacts and
the risk of being unable to scale up CDR in time. The impact of side effects must be con-
sidered under the CBDR&RC, since land-dependent forms of CDR such as BECCS and
Afforestation and Reforestation are likely to be implemented outside the net zero economic
zone.
3.3 The Industrialized‑2050 pathway
Due to the lack of near-term mitigation, the Industrialized-2050 pathway relies to the great-
est extent upon large-scale CDR. This pathway also appears closest to current net zero
commitments. Mitigation costs for OECD countries are projected to be the lowest out of
all three pathways, assuming both moderate discounting and substantial cost-reductions for
CDR. Non-OECD countries would reduce their emissions more slowly than in the Indus-
trialized-2030 pathway (i.e. reaching net zero by 2050), and thus transition costs would be
lower.
In terms of equity, the Industrialized-2050 pathway is a mixed bag. On the one hand,
it seems to adhere to the CBDR&RC principle because historically responsible devel-
oped countries, represented by the OECD in our stylized exposition, would achieve net
zero before developing countries. This would also reflect to an even greater extent the view
that ‘subsistence emissions’ should be guaranteed, since there would be even more space
available for fossil-fuelled development in developing countries compared to the Industri-
alized-2030 pathway. The Industrialized-2050 pathway would have slightly less need for
BCAs compared to the Industrialized-2030 pathway. Although differences in mitigation
efforts between developed and developing countries could provide incentives for energy-
intensive industries to relocate from the former to the latter (thus calling for BCA), this
effect is substantially less pronounced than in the Industrialized-2030 pathway. The Indus-
trialized-2050 pathway would also reduce the need for financial transfers.
However, the reliance on CDR in the Industrialized-2050 pathway imposes serious
equity concerns, both target-based and side effect-based. The lower initial mitigation costs
of the Industrialized-2050 pathway for both developed and developing countries comes at
the price of additional carbon removal later on, which entails significant additional costs
11 Shue (1993) coined the term ‘subsistence emissions’ but never endorsed the substantive view that
became associated with it.

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(monetary and non-monetary). Heavy reliance on CDR in the second half of the century
reflects a high degree of technological optimism, and in so doing, it imposes the great-
est risk of adverse side effects of all three pathways. Since these risks are likely to affect
developing countries and future generations, effects such as undermining food and water
security and biodiversity may threaten potential gains from longer periods of fossil-fuelled
development. Furthermore, by building in a greater reliance on CDR in the second half of
the century, the Industrialized-2050 pathway unfairly shifts the risks of policy failure onto
future generations.
4 Conclusion: anequitable andimplementable net zero agenda
Global momentum for net zero presents many opportunities to achieve an equitable climate
future for all. As policymakers consider how to turn their pledges into reality, it is impor-
tant to consider equity and avoid unnecessary and regrettable conflicts. Policy formulation
needs to be informed by quantitative assessments, and in future modelling building upon
our stylized pathways could provide more detailed insights about the equity dimensions
highlighted in this essay. As our stylized pathways have already shown, none of the options
is unequivocally good or bad, since the trade-offs involved in achieving global net zero
can support or undermine equity outcomes. This precludes simple answers concerning the
most equitable pathway or policy mix, because equity effects are a function of political fac-
tors and specific policy implementation.
Each of the three stylized pathways entails equity challenges, as shown in Table1. If all
countries were to achieve net zero simultaneously in 2050 (‘All-in 2050’ pathway), there
would be high costs for developed and developing countries alike. This pathway could
accord closely with the three pillars of equity recognized in the Paris Agreement, but only
if substantial international financial transfers were available to support low-carbon devel-
opment and to avoid carbon lock-in. This would also create the smallest risks of inequitable
outcomes related to policy failure risk or of unjust side effects by CDR. Policymakers and
activists in favour of the most ambitious global net zero pathway should thus prioritize
both delivering on their pledges and overcoming domestic and international obstacles to
financial transfers to support of renewable energies and low-carbon infrastructure.
Despite the urgency of climate mitigation, providing developing countries time to
develop can still be in line with principles of equity. However, this would require more
drastic emissions reductions in developed countries (‘Industrialized-2030’ pathway) and
could create substantial distributional concerns within them. Such a two-speed approach
Table 1 The trade-offs involved between reliance on BCA, CDR and financial transfers in three stylized
global mitigation pathways to net zero emissions
Reliance on BCA Reliance on CDR Reliance on transfers
(finance and technol-
ogy)
All-in 2050 pathway (no overshoot) Low Low High
Industrialized-2030 pathway (incl. over-
shoot)
High Medium Medium
Industrialized-2050 pathway (incl. over-
shoot)
Medium High Low

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Page 13 of 15 20
to net zero makes BCA more likely, although this may be politically contentious because
it imposes costs on developing countries. To alleviate this, financial transfers again appear
essential.
A two-speed approach also significantly increases the requirements for CDR, especially
under a pathway of slower global achievement of net zero (‘Industrialized-2050’ pathway).
While economic models suggest that this will lower the overall costs of achieving net zero,
such cost-optimization can hide crucial uncertainties that would create severe challenges
for future generations. Policymakers should consider unpriced costs of CDR that do not
feature in economic models, and the risks of side effects from creating massive global
demand for biomass. Given the risk of policy failure, policymakers should favour a portfo-
lio approach to CDR rather than focusing on single technologies.
In light of the trade-offs we have outlined, it is crucial that decision makers, climate
negotiators and publics pay attention to the potentially hidden equity implications of net
zero pathways and their associated policy measures. Doing so is a precondition for ensur-
ing transparency in decision-making, and for holding governments to account. A bottom
line for achieving global net zero equitably appears to be the rapid phase-out of financing
for new fossil fuel infrastructures, and the empowerment of all countries to pursue low-
carbon infrastructure. Any further investment into fossil fuels directly exacerbates loom-
ing mitigation and equity challenges associated with CDR reliance, BCA and international
transfers. While multilateral institutions are slowly moving in this direction, rapid and deci-
sive action is required more than ever.
Supplementary Information The online version contains supplementary material available at https:// doi.
org/ 10. 1007/ s10584- 021- 03270-2.
Author contribution This work has not been previously published in any form, nor is under review
elsewhere.
Funding Dominic Lenzi’s research was supported by the RIVET project, funded by Svenska Forskningsrå-
det Formas (grant number: 2020–00202).
Declarations
Conflict of interest The authors declare no conflicts of interest.
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