Guilford Harbor

Archive for the ‘climate economics’ Category

« Older Entries |

New analysis of population trends and their impact on global greenhouse gas emissions

Tuesday, October 12th, 2010

In 40 years, there will be about 3 billion additional people living on the Earth (~9.5 billion total).   With all of these new folks, it’s easy to think about the added demands of energy, food, and water required to sustain their lifestyles.  And in terms of climate warming, it’s hard to escape the fact that significantly greater energy consumption will lead to rising rates of carbon emissions, unless there’s a shift to decarbonize the economy.

In this week’s early Edition of the Proceedings of the National Academy of Sciences (open access), Brian O’Neill and colleagues note that emissions are not just controlled by the sheer size of the human population but also by important demographic changes.

For example, how might an aging or more urban population affect emissions?  How about changes in household size?  Modelers of carbon emissions don’t usually ask these kinds of questions, so the conventionally projected emissions might be off if these additional demographic details matter.

The researchers developed a global economic model (Population-Environment-Technology, or PET) in which they specified relationships between demographic factors like houshold size, age, and urban/rural residency and economic factors like the demand for consumer goods, wealth, and the supply of labor.  Here’s a bit more on how this works:

In the PET model, households can affect emissions either directly through their consumption patterns or indirectly through their effects on economic growth in ways that up until now have not been explicitly accounted for in emissions models. The direct effect on emissions is represented by disaggregating household consumption for each household type into four categories of goods (energy, food, transport, and other) so that shifts in the composition of the population by household type produce shifts in the aggregate mix of goods demanded. Because different goods have different energy intensities of production, these shifts can lead to changes in emissions rates. To represent indirect effects on emissions through economic growth, the PET model
explicitly accounts for the effect of (i) population growth rates on economic growth rates, (ii) age structure changes on labor supply, (iii) urbanization on labor productivity, and (iv) anticipated demographic change (and its economic effects) on savings and consumption behavior.

Although there are some exceptions, households that are older, larger, or more rural tend to have lower per capita labor supply than those that are younger, smaller, or more urban. Lower-income households (e.g., rural households in developing countries) spend a larger share of income on food and a smaller share on transportation than higher-income households. Although labor supply and preferences can be influenced by a range of nondemographic factors, our scenarios focus on capturing the effects of shifts in population across types of households.

To project these demographic trends, we use the high, medium, and low scenarios of the United Nations (UN) 2003 Long-Range World Population Projections combined with the UN 2007 Urbanization Prospects extended by the International Institute for Applied Systems Analysis (IIASA) and derive population by age, sex, and rural/urban residence for the period of 2000–2100.

What did they find?

(more…)

Posted in behavior, climate economics, energy, gender, population, sustainability, urban | No Comments »

Krugman: Building a Green Economy

Wednesday, April 7th, 2010

The title of a feature article by Paul Krugman in the forthcoming NY Times Magazine.

This piece is worth reading for a good general overview and history of climate economics issues.

He clarifies distinctions between cap and trade and Jim Hansen’s advocacy for a tax-based approach to emissions reductions.

Excerpts:

What about the case for an emissions tax rather than cap and trade? There’s no question that a straightforward tax would have many advantages over legislation like Waxman-Markey, which is full of exceptions and special situations. But that’s not really a useful comparison: of course an idealized emissions tax looks better than a cap-and-trade system that has already passed the House with all its attendant compromises. The question is whether the emissions tax that could actually be put in place is better than cap and trade. There is no reason to believe that it would be — indeed, there is no reason to believe that a broad-based emissions tax would make it through Congress.

To be fair, Hansen has made an interesting moral argument against cap and trade, one that’s much more sophisticated than the old view that it’s wrong to let polluters buy the right to pollute. What Hansen draws attention to is the fact that in a cap-and-trade world, acts of individual virtue do not contribute to social goals. If you choose to drive a hybrid car or buy a house with a small carbon footprint, all you are doing is freeing up emissions permits for someone else, which means that you have done nothing to reduce the threat of climate change. He has a point. But altruism cannot effectively deal with climate change. Any serious solution must rely mainly on creating a system that gives everyone a self-interested reason to produce fewer emissions. It’s a shame, but climate altruism must take a back seat to the task of getting such a system in place.

The bottom line, then, is that while climate change may be a vastly bigger problem than acid rain, the logic of how to respond to it is much the same. What we need are market incentives for reducing greenhouse-gas emissions — along with some direct controls over coal use — and cap and trade is a reasonable way to create those incentives.

But can we afford to do that? Equally important, can we afford not to?

Read on to see what he thinks about these questions…

____

Photo by Wolfgang Staudt

Tags:
Posted in climate economics, solutions | No Comments »

The hidden global CO2 emissions of consumerism

Monday, March 8th, 2010

It’s been easy for citizens of the developed, industrialized world to criticize China and India over their rapidly growing greenhouse gas emissions.  This was one of the major reasons why the Kyoto Protocol was never ratified in the United States.

As many have  pointed out, however, there are several flaws with this argument:

  • The per-capita carbon emissions in China and India remain much lower (1/4 and 1/16, respectively) compared to the U.S..
  • Perhaps more importantly, some of the carbon emission in these countries is caused by the production of export goods to fuel consumer demand in wealthy nations.  Thus, we are responsible for “shadow carbon emissions” that get attributed to developing nations.

Until today, there haven’t been very good estimates of these kinds of shadow emissions.

In the Early Edition of the Proceedings of the National Academy of Sciences, Steven Davies and Ken Caldeira examine how much CO2 is embodied in the import and export of goods.1

Their results are interesting (excerpts below—If you can get a copy of the article, check out figures 1 and 2; they are terrific visuals for this information.  Alas, copyrights don’t allow me to post them):

  • Approximately 6.2 gigatonnes (Gt) of CO2, 23% of all CO2 emissions from fossil-fuel burning, were emitted during the production of goods that were ultimately consumed in a different country.
  • Emissions imported to the United States exceed those of any other country or region, primarily embodied in machinery (91 Mt), electronics (77 Mt), motor vehicles and parts (75 Mt), chemical, rubber, and plastic products (52 Mt), unclassified manufactured products (52 Mt), wearing apparel (42 Mt), and intermediate goods (654 Mt).
  • These imports are offset by considerable US exports of transport services (49 Mt CO2), machinery (42 Mt), electronics (26 Mt), chemical, rubber, and plastics products (25 Mt), motor vehicles (22 Mt), and intermediate goods (263 Mt).
  • [G]oods imported to Western Europe and Japan embody much more CO2 per US$ than do their exports, reflecting the import of energy-intensive products from elsewhere.
  • The carbon intensity of imports to China, Russia, India, and the Middle East is consistently far less than that of their exports.
  • China is by far the largest net exporter of emissions, followed by Russia, the Middle East, South Africa, Ukraine, and India and, to a lesser extent, Southeast Asia, Eastern Europe, and areas of South America.
  • The primary net importers of emissions are the United States, Japan, the United Kingdom, Germany, France, and Italy. Although the overall mass of emissions is much less, the other countries of Western Europe are all net importers, as are New Zealand, Mexico, Singapore, and many areas of Africa and South America. Similarly, Canada, Australia, Indonesia, the Czech Republic, and Egypt are among the countries whose net exports of emissions are small.
  • On a per-capita basis, net imports of emissions to the United States, Japan, and countries in Western Europe are disproportionately large, with each individual consumer associated with 2.4–10.3 tons of CO2 emitted elsewhere.

Their conclusion:

Consumption-based accounting reveals that substantial CO2 emissions are traded internationally and therefore not included in traditional production-based national emissions inventories. The net effect of trade is the export of emissions from China and other emerging markets to consumers in the United States, Japan, and Western Europe. In the large economies of Western Europe, net imported emissions are 20–50% of consumption emissions; the net imported emissions fall to 17.8% and 10.8% in Japan and the United States, respectively. In contrast, net exports represent 22.5% of emissions produced in China. Thus, to the extent that constraints on emissions in developing countries are the major impediment to effective international climate policy, allocating responsibility for some portion of these emissions to final consumers elsewhere may represent an opportunity for compromise.

1Steven J. Davis and Ken Caldeira (2010). Consumption-based accounting of CO2 emissions PNAS : 10.1073/pnas.0906974107

_____
Photo Credit: http://www.flickr.com/photos/deks/ / CC BY-NC 2.0

Tags: ,
Posted in behavior, climate change science, climate economics, energy, nature and culture, technology, transportation | 1 Comment »

Lindsey Graham on climate warming: “I am doing something different”

Saturday, February 27th, 2010

In a previous post, I mentioned that it’s worth listening to Lindsey Graham (R-SC) to understand what might move conservative politicians towards a serious conversation about climate warming.

Tom Friedman does just that in Sunday’s NY Times.

Graham’s reasons for taking climate change seriously: politics, jobs, and legacy.  His story is unusual and refreshing:

“I have been to enough college campuses to know if you are 30 or younger this climate issue is not a debate. It’s a value. These young people grew up with recycling and a sensitivity to the environment — and the world will be better off for it. They are not brainwashed. … From a Republican point of view, we should buy into it and embrace it and not belittle them. You can have a genuine debate about the science of climate change, but when you say that those who believe it are buying a hoax and are wacky people you are putting at risk your party’s future with younger people.”

….And for those Republicans who think this is only a loser, Senator Graham says think again: “What is our view of carbon as a party? Are we the party of carbon pollution forever in unlimited amounts? Pricing carbon is the key to energy independence, and the byproduct is that young people look at you differently.” Look at how he is received in colleges today. “Instead of being just one more short, white Republican over 50,” says Graham, “I am now semicool. There is an awareness by young people that I am doing something different.”

Posted in behavior, climate economics, energy, solutions | No Comments »

Al Gore weighs in on the state of climate change

Saturday, February 27th, 2010

406858534_92359c4a1f

…in an op-ed piece in today’s NY Times.

Excerpts (links his):

[T]he scientific enterprise will never be completely free of mistakes. What is important is that the overwhelming consensus on global warming remains unchanged. It is also worth noting that the panel’s scientists — acting in good faith on the best information then available to them — probably underestimated the range of sea-level rise in this century, the speed with which the Arctic ice cap is disappearing and the speed with which some of the large glacial flows in Antarctica and Greenland are melting and racing to the sea.

Because these and other effects of global warming are distributed globally, they are difficult to identify and interpret in any particular location. For example, January was seen as unusually cold in much of the United States. Yet from a global perspective, it was the second-hottest January since surface temperatures were first measured 130 years ago.

Similarly, even though climate deniers have speciously argued for several years that there has been no warming in the last decade, scientists confirmed last month that the last 10 years were the hottest decade since modern records have been kept.

The heavy snowfalls this month have been used as fodder for ridicule by those who argue that global warming is a myth, yet scientists have long pointed out that warmer global temperatures have been increasing the rate of evaporation from the oceans, putting significantly more moisture into the atmosphere — thus causing heavier downfalls of both rain and snow in particular regions, including the Northeastern United States. Just as it’s important not to miss the forest for the trees, neither should we miss the climate for the snowstorm.

….The political paralysis that is now so painfully evident in Washington has thus far prevented action by the Senate — not only on climate and energy legislation, but also on health care reform, financial regulatory reform and a host of other pressing issues.

….Some analysts attribute the failure to an inherent flaw in the design of the chosen solution — arguing that a cap-and-trade approach is too unwieldy and difficult to put in place. Moreover, these critics add, the financial crisis that began in 2008 shook the world’s confidence in the use of any market-based solution.

But there are two big problems with this critique: First, there is no readily apparent alternative that would be any easier politically….Second, we should have no illusions about the difficulty and the time needed to convince the rest of the world to adopt a completely new approach.

Updates: There is a wide range of opinion on the IPCC these days:

_____

Photo credit:  http://www.flickr.com/photos/adc/ / CC BY 2.0

Tags:
Posted in climate change science, climate economics, climate skeptics deniers and contrarians, communication and framing, energy, policy, sustainability | No Comments »

Are business externalities really this big?

Friday, February 19th, 2010

How much does pollution (and other environmental impacts) from corporations cost each year?  These costs, borne by society rather than corporations, are called negative externalities.  An example is the cost of medical expenses and the loss of forests caused by air pollution.

The Guardian is running a story by Juliette Jowit suggesting that the total cost of externalities for the 3,000 largest companies in the world could be as much as $US 2.2 trillion in 2008.  As the story points out, that’s a lot:

  • more than the economies of all but 7 nations
  • about one third the value of the profits of these companies

Excerpts (links by Jowit):

Later this year, another huge UN study – dubbed the “Stern for nature” after the influential report on the economics of climate change by Sir Nicholas Stern – will attempt to put a price on such global environmental damage, and suggest ways to prevent it. The report, led by economist Pavan Sukhdev, is likely to argue for abolition of billions of dollars of subsidies to harmful industries like agriculture, energy and transport, tougher regulations and more taxes on companies that cause the damage.

“What we’re talking about is a completely new paradigm,” said Richard Mattison, Trucost’s chief operating officer and leader of the report team. “Externalities of this scale and nature pose a major risk to the global economy and markets are not fully aware of these risks, nor do they know how to deal with them.”

“It’s going to be a significant proportion of a lot of companies’ profit margins,” Mattison told the Guardian. “Whether they actually have to pay for these costs will be determined by the appetite for policy makers to enforce the ‘polluter pays’ principle. We should be seeking ways to fix the system, rather than waiting for the economy to adapt. Continued inefficient use of natural resources will cause significant impacts on [national economies] overall, and a massive problem for governments to fix.”

Another major concern is the risk that companies simply run out of resources they need to operate, said Andrea Moffat, of the US-based investor lobby group Ceres, whose members include more than 80 funds with assets worth more than US$8tn. An example was the estimated loss of 20,000 jobs and $1bn last year for agricultural companies because of water shortages in California, said Moffat.

Tags:
Posted in climate economics, policy, pollutants | No Comments »

Is a post-Copenhagen roadmap emerging?

Monday, February 1st, 2010

WORLD ECONOMIC FORUM ANNUAL MEETING 2010 DAVOSOver the past few years, there have been a couple of major approaches for dealing with climate change:

  • Use political tools to set emissions targets (e.g., 80% reduction by 2050);
  • Invest heavily in green technology to drive green energy prices lower.  Only then will these technologies take hold. Carbon reductions are an important byproduct but not the main goal.

Of course these are not mutually exclusive, but they might as well be given the way they have played out on the political stage.

With a lot of people down on political solutions to deal with climate change, strong advocates of the latter approach may now gain the upper hand.  Folks like Shellenberger and Nordhaus have been arguing that green energy needs to be produced as quickly and cheaply as possible—forget all of the games with cap and trade or carbon taxes.   Tom Friedman has also argued the need for swift action on energy, while also endorsing political solutions like carbon taxes.

If you look for areas that are gaining or have the potential to gain traction, there seem to be two levers that may work:

Both of these general concerns have attracted Republican support for green energy and climate change mitigation, including Senator Lindsey Graham (R-SC).

This may be a signal of potential game changers and the clearest path forward that we’ve seen in awhile.

_____

Photo credit:  http://www.flickr.com/photos/worldeconomicforum/ / CC BY-SA 2.0

Tags:
Posted in climate economics, conflict, energy, policy, risk analysis, solutions | 1 Comment »

Extreme climate and the vulnerability of least-developed countries

Wednesday, January 6th, 2010

3964015326_0088461cd2

Happy New Year, everyone.  Sorry for the lag in posts, but there wasn’t a lot happening in the news or journals over the past week.

A few years ago, I saw a talk by Thomas Schelling (Nobel laureate in economics) who argued that we need to accelerate the economic development of poor countries so that they are able to cope with climate change.  This analysis is interesting, if not fraught with additional challenges, such as development in a carbon-based energy world hastening the very problem to which these nations are attempting to adapt.

In an article1 in the Early Edition of the Proceedings of the National Academy of Sciences (open access), Anthony Patt and colleagues argued that the need for assistance by Least Developed Countries (LDCs) is dependent on vulnerability, which, in turn, depends on both exposure to climate change and how socioeconomic factors affect the sensitivity of LDCs to climate change.

To assess this hypothesis, they first examined how deaths caused by disasters (floods, droughts, and storms) varied across the level of development in several LDCs.  They used the UN Human Development Index—HDI, a composite metric of income, education, and life expectancy—as a proxy for development.

Here’s what they found…

(more…)

Posted in climate adaptation, climate economics, policy, race and class, risk analysis, social science, sustainable development | No Comments »

Hansen (C tax) vs. Krugman (cap and trade): A lesson in transdisciplinary understanding?

Tuesday, December 8th, 2009

An interesting exchange happened yesterday at the NY Times.  Climate scientist James Hansen wrote a column, Cap and Fade, which, as the name suggests, is critical of cap and trade policies for mitigating climate warming.

In his blog, Paul Krugman responded with an article, Unhelpful Hansen, in which he takes readers through a basic primer of C taxes and cap and trade, arguing that they are basically the same and that Hansen is wrong for trashing what may end up being the best available approach.

Most of this is the kind of policy play-by-play that dominates daily blog traffic.  However, one of Krugman’s paragraphs caught my eye:

Things like this often happen when economists deal with physical scientists; the hard-science guys tend to assume that we’re witch doctors with nothing to tell them, so they can’t be bothered to listen at all to what the economists have to say, and the result is that they end up reinventing old errors in the belief that they’re deep insights. Most of the time not much harm is done. But this time is different.

Although this may not be an entirely fair criticism of Hansen (I have no idea what his formal training in economics is), it is interesting to see the implied call for better transdisciplinary understanding.   Social scientists have a responsibility to call out natural scientists for being naive when they wade around in social issues (and vice versa).  Although most of us are trained as disciplinarians, this is why it’s good to stretch ourselves and really understand perspectives and theory from fields with which we are not traditionally affiliated—as any good Environmental Studies program should do.  Most of the time it makes us better teachers and scholars.  And more humble about what we know and don’t know.

Specialization and expertise have their limitations, and, as Krugman points out, in some cases, they can be downright counterproductive.

Posted in climate economics, higher education, policy, science advocacy, social science, solutions | No Comments »

In this week’s issue of Nature: What do radar, nuclear power, the Internet, and DNA have in common with technological innovation to decarbonize the economy?

Wednesday, December 2nd, 2009

3581237503_b63e752f02

Most of the focus these days is on how we can mitigate climate warming by achieving specific reductions targets like 20% by 2020 and 80% by 2050.  Economists from McGill University, Isabel Galiana and Christopher Greene, are going to stir up debate in their latest paper1 in Nature by arguing that the current way of thinking about mitigating warming needs to be turned on its head.

Focusing on rapid emissions reductions, they say, may not be the best way to rapidly stabilize climate as cheaply as possible.  They even go as far as to say that climate can be stabilized at a 2 degree C warming even if most of the carbon reductions don’t happen until after 2050.

What’s the basis for their argument?  Technology-led approaches.  Let’s see what this means…

(more…)

Posted in climate economics, energy, sustainable development, technology | No Comments »

« Older Entries |
Bowdoin College

Bowdoin College web site:

Search | A - Z Index | Directory