This paper aims at proposing a way to get round the intrinsic deadlocks of the economic assessment of climate change impacts (absence of consistent baseline scenario and of credible description of adaptation behaviours under uncertainty). First, we use climate scenarios from two models of the PRUDENCE project (HadRM3H and ARPEGE) to search for cities whose present climates can be considered as reasonable analogues of the future climates of 17 European cities. These analogues meet rather strict criteria in terms of monthly mean temperature, total annual precipitations and monthly mean precipitations. Second, we use these analogues as a heuristic tool to understand the main features of the adaptation required by climate change. The availability of two analogues for each city provides a useful estimate of the impact of uncertainty on the required adaptation efforts. Third, we carry out a cost assessment for various adaptation strategies, taking into account the cost of possible ill-adaptations due to wrong anticipations in a context of large uncertainty (from sunk-costs to lock-in in suboptimal adaptation choices). We demonstrate the gap between an enumerative approach under perfect expectation and a calculation accounting for uncertainty and spillover effects on economic growth.

After nearly two decades of debate and fundamental disagreement, top-down and bottom-up energy-economy modelers, sometimes referred to as modeling 'tribes', began to engage in productive dialogue in the mid-1990s (IPCC 2001). From this methodological conversation have emerged modeling approaches that offer a hybrid of the two perspectives. Yet, while individual publications over the past decade have described efforts at hybrid modeling, there has not as yet been a systematic assessment of their prospects and challenges. To this end, several research teams that explore hybrid modeling held a workshop in Paris on April 20-21, 2005 to share and compare the strategies and techniques that each has applied to the development of hybrid modeling. This special issue provides the results of the workshop and of follow-up efforts between different researchers to exchange ideas. 1. THE oRiGinAL BoTToM-uP / ToP-DoWn DiviSion Policy-makers are interested in a better understanding of the effectiveness and cost of policies whose purpose is to shift energy systems toward more environmentally desirable technology paths. What technologies would serve this purpose, and how could or would the economy adapt in response to policy to

This publication translates the key scientific findings and policy observations of the IPCC Special Report on Global Warming of 1.5°C for officials and policymakers of the world's cities and urban areas. It does not necessarily reflect the views of the IPCC or member governments.

International audienceDespite the inextricable link between oil scarcity and climate change, the interplay between these two issues is paradoxically an underworked area. This article uses a global energy-economy model to address the link between future oil supply and climate change and assesses in a common framework both the costs of climate policies and oil scarcity. It shows that, in the context of a limited and uncertain amount of ultimately recoverable oil resources, climate policies reduce the world vulnerability to peak oil. Climate policies, therefore, appear as a hedging strategy against the uncertainty on oil resources, in addition to their main aim of avoiding dangerous climate change. This co-benefit is estimated at the net present value of US$11,500 billion. Eventually, reducing the risk of future economic losses due to oil scarcity may appear as a significant side-benefit of climate policies to many decision-makers

Introducing a carbon tax is difficult, partly because it suggests that current generations have to make sacrifices for the benefit of future generations. However, the climate change externality could be corrected without such a sacrifice. It is possible to set a carbon value, and use it to create 'carbon certificates' that can be accepted as part of commercial banks' legal reserves. These certificates can be distributed to low-carbon projects, and be exchanged by investors against concessional loans, reducing capital costs for low-carbon projects. As the issuance of carbon certificates would increase the quantity of money, it will either lead to accelerated inflation or induce the Central Bank to raise interest rates. Low-carbon projects will thus have access to cheaper loans at the expense of either 'regular' investors (in case of higher interest rates) or of lenders and depositors (in case of accelerated inflation). Within this scheme, mitigation expenditures are compensated by a reduction in regular investments, so that immediate consumption is maintained. It uses future generation wealth to pay for a hedge against climate change. This framework is not as efficient as a carbon tax but is politically easier to implement and represents an interesting step in the trajectory towards a low-carbon economy.La mise en place d'une taxe carbone est difficile, en partie parce qu'elle suggère que les générations actuelles doivent faire des sacrifices au profit des générations futures. Il est cependant possible de corriger l'externalité du changement climatique sans faire de tels sacrifices, en établissant une valeur du carbone et en l'appliquant à des « certificats carbones » qui seraient acceptés comme réserves légales des banques commerciales. Ces certificats seraient distribués aux projets bas-carbone et échangés par les investisseurs contre des prêts concessionnels auprès de banques commerciales, réduisant ainsi le coût des projets. Puisque la distribution des certificats carbone augmenterait la quantité de monnaie en circulation, cela provoquerait une hausse de l'inflation ou forcerait la Banque Centrale à augmenter les taux d'intérêt. Les projets bas-carbone auraient ainsi accès à des prêts moins chers, au détriment des autres investisseurs (dans le cas d'une augmentation des taux d'intérêt) ou des épargnants (dans le cas d'une hausse de l'inflation). Dans ce cadre, les coûts de l'atténuation sont compensés par une diminution des investissements ordinaires, de façon à ce que la consommation soit maintenue. La richesse future est ainsi utilisée pour s'assurer contre le changement climatique. Ce mécanisme n'est pas aussi efficace qu'une taxe carbone mais est plus acceptable politiquement et représente un premier pas intéressant vers une économie bas-carbone.