Resource use is increasing globally, and four of nine planetary boundaries have now been crossed due human activities, out of which climate change and biosphere integrity are "core boundaries", implying a risk of driving the Earth system into a new state. While technological advances, policy changes and burden shifting from developed to developing countries have led to decoupling in many countries, this does not change the negative trends globally and address the main drivers behind. In the case of climate change deep decarbonisation of the global economy would be required resulting in radical emissions reductions. The objective of this paper is to analyse the main reasons of the rift between what climate science requires and what current climate policies can deliver with the currently applied policies, and how an international energy budget scheme can tackle these problems. The energy budget scheme builds on initiatives like the energy entitlement scheme and the Tradable Energy Quotas (TEQs), which gained considerable political recognition in Hungary and in the UK respectively, building on substantial scientific research. The energy budget scheme puts a hard cap on energy use, and links this with incentive schemes to deliver tightening national and international targets. The annual entitlements for energy use for households and all other public and private consumers ensure the needed reductions in greenhouse gas emissions, while the trade in entitlements among consumers on national level and countries on international level contributes to value change, global energy transition and puts Common but Differentiated Responsibilities (CBDR) into practice. The transition fund provides a financing scheme for driving investment and technological innovation, where the payback rate is linked to improvements in decarbonisation and made through unused entitlements. The dedicated market for environmental products and services operates with quota currency realised from entitlement savings, and boosts the green economy.