The costs of climate inaction – “The way in which society currently prices carbon is an order of magnitude too low”
25 September 2018 (Nature) – Politics, according to the nineteenth-century German statesman Otto von Bismarck, is the art of the next best. The global approach of politicians to tackling climate change is a sorry example of this.
The problem: destructive storms that hit the United States and southeast Asia this month are the latest reminder of how vulnerable societies across the world are to climate extremes. The best political solution might seem to be to subordinate all policies — domestic and international — to the goal of stabilizing Earth’s climate. This is difficult. So, instead, the world must rely on the effectiveness of voluntary actions that nations have agreed on under a non-binding international compromise treaty forged in Paris in 2015.For all its symbolic power, that Paris treaty is a truly second-best solution. Even if it had worked as advertised, the promised cuts in greenhouse-gas emissions are weak. And now the withdrawal of the United States — and, de facto, of Australia — has substantially weakened the global consensus before the treaty has even come into effect.iscussions on how and when it will start will resume at a two-week United Nations meeting in December in Katowice, Poland. Those attending would do well to read a study published this week in Nature Climate Change that highlights just how irrational it is for the politicians who represent many large economies to settle for next best (K. Ricke et al. Nature Clim. Change http://doi.org/ct7x; 2018).The analysis revisits the concept of the social cost of carbon: the cumulative economic impact of global warming caused by (or attributed to) each tonne of the pollutant sent into the atmosphere. This study goes a step further than previous ones and estimates the likely cost to different countries. In doing so, it reveals the countries projected to take the hardest hits.China and the United States, the world’s two largest emitters of carbon dioxide, will incur some of the highest social costs of carbon of all countries, the scientists report, with respective estimated impacts of US$24 per tonne and $48 per tonne. India, Saudi Arabia, and Brazil also feature towards the top. In these countries — unlike in Canada, northern Europe, and Russia — temperatures are already above the economic optimum. And climate-induced damage increases with wealth and economic growth, meaning that more-valuable property might sit in harm’s way.Combined country-level costs (and benefits) add up to a global median of more than $400 in social costs per tonne of CO2 — more than twice previous estimates. On the basis of CO2 emissions in 2017, that’s a global impact of more than $16 trillion. The new analysis is based on a set of climate simulations, rather than a single climate model, and the authors calculated future harm using empirical damage functions that were independently developed for that purpose. [more]
ABSTRACT: The social cost of carbon (SCC) is a commonly employed metric of the expected economic damages from carbon dioxide (CO2) emissions. Although useful in an optimal policy context, a world-level approach obscures the heterogeneous geography of climate damage and vast differences in country-level contributions to the global SCC, as well as climate and socio-economic uncertainties, which are larger at the regional level. Here we estimate country-level contributions to the SCC using recent climate model projections, empirical climate-driven economic damage estimations and socio-economic projections. Central specifications show high global SCC values (median, US$417 per tonne of CO2 (tCO2); 66% confidence intervals, US$177–805 per tCO2) and a country-level SCC that is unequally distributed. However, the relative ranking of countries is robust to different specifications: countries that incur large fractions of the global cost consistently include India, China, Saudi Arabia and the United States.
