| perspective on climate change policies |
[Sep. 16th, 2009|02:22 pm] |
This is the most interesting article about climate change policy I've read in a long time: http://www.nybooks.com/articles/21494. It really puts things in perspectives and has altered my impressions of the different options.
In the book being reviewed, the author is an economist that models the purely financial impact of a variety of climate change policies over a hundred year period, independent of the environmental changes they produce. The options are business-as-usual, the Kyoto Protocol, an optimally chosen carbon tax, the Nicholas Stern proposal (strong emission limits), and the Gore policy (strong but gradually applied limits, e.g. 90 percent cut by 2050). The other option is a low-cost backstop (e.g. low-cost solar, nonintrusive climate engineering, genetically-engineered trees). The results...
"""Here are the net values of the various policies as calculated by the DICE model. The values are calculated as differences from the business-as-usual model, without any emission controls. A plus value means that the policy is better than business-as-usual, with the reduction of damage due to climate change exceeding the cost of controls. A minus value means that the policy is worse than business-as-usual, with costs exceeding the reduction of damage. The unit of value is $1 trillion, and the values are specified to the nearest trillion. The net value of the optimal program, a global carbon tax increasing gradually with time, is plus three—that is, a benefit of some $3 trillion. The Kyoto Protocol has a value of plus one with US participation, zero without US participation. The "Stern" policy has a value of minus fifteen, the "Gore" policy minus twenty-one, and "low-cost backstop" plus seventeen.
...
The main conclusion of the Nordhaus analysis is that the ambitious proposals, "Stern" and "Gore," are disastrously expensive, the "low-cost backstop" is enormously advantageous if it can be achieved, and the other policies including business-as-usual and Kyoto are only moderately worse than the optimal policy. The practical consequence for global-warming policy is that we should pursue the following objectives in order of priority. (1) Avoid the ambitious proposals. (2) Develop the science and technology for a low-cost backstop. (3) Negotiate an international treaty coming as close as possible to the optimal policy, in case the low-cost backstop fails. (4) Avoid an international treaty making the Kyoto Protocol policy permanent. These objectives are valid for economic reasons, independent of the scientific details of global warming."""
A corollary is that it's in the world's economic incentive to spend up to 14 trillion dollars on researching the low-cost backstop technology. I get the impression that we are not spending that much money on it though... |
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