Climate Change Policy Issues
EVERYTHING IS CONNECTED
EVERYTHING IS UNCERTAIN
ANYTHING MIGHT CAUSE ANYTHING
DON'T DO ANYTHING ...
SOMETHING HAS TO BE DONE!
-Michael Markels (Cited in Wired Magazine, 8 (11),
Maintaining the Earth’s
climate within habitable boundaries is probably the greatest "public
goods game" played by humans. However, with >6 billion "players" taking
part, the game seems to rule out individual altruistic behavior.
Thus, climate protection is a problem of sustaining a public resource
that everybody is free to overuse, a "tragedy of the commons" problem
that emerges in many social dilemmas.
- Milinski et al (2006)
Many people, most governments, and large industries have
concluded that climate change is happening. The important questions now
- How serious is the threat of warming?
- If it is serious, how best to respond to the threat?
- Is it better to wait until the threat becomes clearer?
- Or should we act now, without clear knowledge of what will happen?
How Serious Is the Threat?
Scientific evidence for warming is convincing. Earth's surface is warming.
The future is less certain. Do we even want to stop global warming?
Given that the climate is changing because
of inadvertent consequences of human activities, the question arises
as to whether efforts should be made to deliberately change climate
to counteract the warming. Aside from the wisdom and ability to do
such a thing economically, the more basic question is the ethical
one...Who makes the decision on behalf of all humanity and other
residents of planet earth to change the climate deliberately? Climate
change is not necessarily bad.
Frosch and Trenberth (2009).
Our understanding of the importance of global warming depends on the
accuracy of climate forecasts. Forecast accuracy depends
on how well we understand earth's carbon cycle, economics, and politics.
All influence warming. All are uncertain.
For a contrarian view on global warming, read HERETICAL
THOUGHTS ABOUT SCIENCE AND SOCIETY by Freeman Dyson.
The Precautionary Principle
Faced with the uncertainty in our ability to predict future climate
change, many argue in favor of the precautionary
When an activity raises threats of harm
to human health or the environment, precautionary measures should
be taken even if some cause and effect relationships are not fully
New Uncertainty Principle.
Policymakers need to take a precautionary
approach to environmental protection ... We must acknowledge that
uncertainty is inherent in managing natural resources, recognize
it is usually easier to prevent environmental damage than to repair
it later, and shift the burden of proof away from those advocating
protection toward those proposing an action that may be harmful.
From New Jersey governor Christine Todd Whitman In an October
2000 speech at the National Academy of Sciences in Washington,
The precautionary principle has been interpreted in many ways. In its
The principle can be interpreted as calling
for absolute proof of safety before allowing new technologies to
be adopted. For example, the World Charter for Nature (1982) states "where
potential adverse effects are not fully understood, the activities
should not proceed." If interpreted literally, no new technology
could meet this requirement.
and the Precautionary Principle."
The strong form stifles progress. If the principle had been applied
when fire was invented, we would still be eating our food raw. "If
applied to aspirin, it would never have been licensed for sale." writes
Helene Guldberg in Challenging
the Precautionary Principle.
The principle is more useful in a weaker form. We need only require
that present activity be modified if the future costs of present activity
may greatly exceed the cost of changing present activity. For example,
if the future cost of climate change may greatly exceed the cost of reducing
emissions of greenhouse gases, then we ought to reduce the emissions.
When applied to climate change and global warming the important points
- We have only one earth.
- If greenhouse gas emissions cause large changes in climate, we may
not be able to return to our present climate for centuries. CO2 concentrations
will remain high for more than 100 years, and temperature will continue
to rise even if we stopped all emissions today, even if we do not know
how much temperature will rise.
- The economic and environmental costs of abrupt climate change far
exceed the costs of slowly reducing greenhouse gas emissions (over
the next two decades).
- Therefore we ought to reduce emissions even if we are not sure they
will cause abrupt climate change.
- Two decades from now we will know much more about climate change,
and at that time we can reassess our activity.
The precautionary principle may also apply in trying to reduce greenhouse
gas. Reducing greenhouse gas to their pre-industrial level may not return
earth to a pre-industrial climate.
In a highly nonlinear feedback-controlled
system like global climate, we would expect complex hysteresis effects:
Decreasing a control variable such as greenhouse gas will not necessarily
lead the climate back along some path like the one it followed when
the control variable was increased. The end state of the control-variable
manipulation may not at all resemble the original state before the
control variable was increased, nor will it necessarily be a state
we want to be in.
Frosch and Trenberth (2009).
The Kyoto Protocol: A Framework for International Cooperation
Most of the governments of the world, are considering ways
to reduce greenhouse gas emissions. The first global step toward reductions
was the Kyoto Protocol. On February 16, 2005, the Kyoto Protocol entered
into force without ratification by the United States. By July 10, 2006
164 nations and economic regional integration organizations had ratified
- What is being proposed?
The primary document is the Kyoto
Protocol to the United Nations Framework Convention on Climate
Change. According to the protocol
"The Parties included in Annex I
[the developed countries of the world] shall, individually or jointly,
ensure that their aggregate anthropogenic carbon dioxide equivalent
emissions of the greenhouse gases listed in Annex A do not exceed
their assigned amounts, calculated pursuant to their quantified
emission limitation and reduction commitments inscribed in Annex
B and in accordance with the provisions of this Article, with a
view to reducing their overall emissions of such gases by at least
5 per cent below 1990 levels in the commitment period 2008 to 2012."
From Article 3 of the Kyoto
- How sound are the arguments that support or oppose the proposals?
- Read the US Congressional Research Service (CRS) abstract of
their report on Global
Climate Change: Major Scientific and Policy and the report (104
kByte pdf file) which gives a good overview of the policy issues
up to 11 August 2006. The Kyoto
Protocol became legally binding on 16 February 2005 at midnight
New York time (0500 GMT). The countries that ratified the protocol
agreed to cut their greenhouse gas emissions between 2008 to
2012 to levels that are 5.2 per cent below 1990 levels.
- Then go the the Energy
Information Administration's Analysis and Report and read
about the implications for the US economy.
- The United States has ratified the United Nations Framework Convention
on Climate Change, but we have not ratified the Kyoto Protocol.
The primary reasons for not ratifying the protocol include:
- It excludes the world's most populous countries, China
and India, because they are developing countries. The US
wanted meaningful participation by all countries.
- There is no clear statement of penalties for failure to implement
- The protocol emphasizes sources of greenhouse gases, but
atmospheric concentration depends on sources and sinks. The
protocol did not give sufficient weight to implementing new
sinks of greenhouse gases. For example, reforestation removes
carbon dioxide from the atmosphere. Or, carbon dioxide could
be removed from the atmosphere and injected into deep wells.
To what extent can which carbon sequestration by forests, soils
and agricultural practices be counted toward a country’s
- It was not clear how much of a country’s obligation
to reduce emissions can be met through purchasing credits from
outside, vs. taking domestic action.
- The role of emissions trading was not clear. The US would
like to use emissions trading to meet a significant percentage
of our required reduction in greenhouse gas emissions.
- It penalizes the US more than other countries because our
economy has been growing strongly compared with other countries
that have ratified the protocol.
- Although some of these problems were mitigated through later
meetings of the Conference of the Parties (COP), the problems are
still not completely solved.
- Economists point out that the cost of reducing emissions now
exceed the cost of reducing emissions in the future when we know
more about the consequences of global warming.
- Economists also point out that the cost of global warming is
about equal to the benefits. Canada and Russia will gain, other
economies will lose. "Given reasonable inputs, most cost-benefit
models show that dramatic and early carbon reductions cost more
than the good they do."– Stern
Review: The dodgy numbers behind the latest warming scare.
The Kyoto Protocol is a symbolically
important expression of governments' concern about climate
change. But as an instrument for achieving emissions reductions,
it has failed. It has produced no demonstrable reductions
in emissions or even in anticipated emissions growth. And
it pays no more than token attention to the needs of societies
to adapt to existing climate change.
Time to Ditch Kyoto. Prins (2007)
- What are the implications for TAMU students?
Carbon price needed to meet Kyoto goals
in the US. Price increases encourage a reduction in the use of energy
services (heating, lighting, and travel, for example), the adoption
of more energy-efficient equipment, and a shift to less carbon-intensive
fuels. The carbon price reflects the amount fossil fuel prices in
the US, adjusted for the carbon content of the fuel, must rise to
achieve the removal of the last ton of carbon emissions that meets
the carbon reduction target in each case. From; Energy
Note: 10 barrels of oil contain about 1 metric ton of carbon. US EPA Green
Power Equivalency Calculator Methodologies.
Ways to Reduce Greenhouse gas Emissions
The Kyoto Protocol sets a goal for reducing greenhouse
gas emissions. Each country must determine how to reach the goal. Three
approaches are taken.
- Command and control. The government decides what must be done. For
example, the US Congress is proposing to set limits on gasoline mileage
for cars. This approach is rarely effective. Drivers in the US switched
from small cars to large, less-fuel efficient cars, despite government
regulations on fuel efficiency, because the larger vehicles are safer
and they are able to carry children and sport equipment used by children.
Historical experience since 1800 shows that increased energy efficiency
usually leads to more energy consumption.
- Economic incentives. European and other governments provide economic
incentives such as reduced taxes and funding to those who produce electricity
from wind turbines or solar cells.
- Use market-based incentives such as taxation to encourage reductions.
For example, tax the emission of green-house emissions, allowing each
user to determine how best to avoid the tax. This is the approach preferred
by economists. The market place is almost always wiser than any politician
or government, and it can act much faster and more efficiently.
The different approaches have very different costs, and governments
often make popular but costly choices.
The cost of different ways to cut emissions of carbon dioxide in euros
per ton of carbon dioxide. Insulation improvements are the least
expensive, and switching from coal to gas for production of electricity
is one of the most expensive.
From The Economist, 3 June 2007 page 9.
An Overlooked Argument
We know that climate changes, and the changes influence
society. As greenhouse gas concentrations increase, the probability of
climate change increases. Climate change is inevitable. We know furthermore
that many societies are especially vulnerable to climate change. Coastal
communities in Florida are vulnerable to increased hurricane frequency
and intensity. The Maldives are vulnerable to rising sea level.
If climate will change, we need to reduce society's vulnerability
to change. This aspect of the problem has been largely ignored.
Other Sources (if you like to read a lot):
- Resources for the Future has a
good Guide to
- The Sierra Club has an Overview
of Global Warming and Energy.
- The New Scientist provides
- Greenpeace's Save
the Climate Campaign
- Wall Street Journal Editorial 19 January 2006 page A14: Although
many developed countries that have signed the Kyoto Protocol have criticized
the USA for not signing the Kyoto Protocol, they have failed to reduce
their own emissions. Denmark has increased emissions 6.3% since 1990
although they committed to reducing emissions by 21%. USA emissions
are up 15.8% since 1990, Greece's emissions are up 23%, Canada's are
If you have the interest, you might look at these web pages.
- For an international viewpoint, read the documents presented at the
meetings organized through the United
Nations Framework on Climate Change.
- CNN maintains an historic
site describing the issues from their viewpoint. See their report
on the economic
costs of implementing the Kyoto Protocol and the international
disagreements on what to do next.
- In determining policy, the cost of future damages C due
to climate change must be converted to their present value Ct,
Present value is the value on a given
date of a future payment or series of future payments, discounted
to reflect the time value of money and other factors such as
investment risk. Present value calculations are widely used
in business and economics to provide a means to compare cash
flows at different times on a meaningful "like to like" basis.
From Wikipedia article on Present
The present value Ct of
a future expense C is calculated
from Ct = C (1 + i)–t,
where t is the time in years, and i is
the cost of money, usually an assumed interest rate that could be
earned if the money were invested. The assumed interest rate is controversial
because a small change in the rate makes a large difference in the
present value if time is several decades or a century. For example,
a cost of $1000 that will be incurred in 50 years has a present value
of $87.20 if i = 5%, and a value
of $54.29 if i = 6%.
For more on this problem, read the Hoover Digest article An
Economist Looks at Global Warming by Gary S. Becker, who was awarded
the Nobel Prize for Economics in 1992.
Frosch, R. A. and K. E. Trenberth (2009). "Geoengineering: What,
how, and for whom?" Physics Today 62
Manfred Milinski, Dirk Semmann, Hans-Jürgen Krambeck, and Jochem
Marotzke (2006) "
Stabilizing the Earth’s climate is not a losing game: Supporting
evidence from public goods experiments." Proceedings
of the National Academy of Sciences, 103: 3994 - 3998.
Prins, G. and S. Rayner (2007). Time to Ditch
Kyoto. Nature 449 (7165): 973–975.
20 February, 2009