Costs of Curing Climate Change: Low

April 13, 2014

Above, from December 2013, a segment from Jim Byrne’s  San Francisco interview with Lord Nicholas Stern of the London School of Economics, on the cost of mitigating climate change.

We’re going to be spending money on energy in coming years. Question is, will we keep spending it on the polluting technologies of the 19th century, or begin, belatedly, deploying the technologies of the new energy revolution?

The latest Working Group report of the Intergovernmental Panel on Climate Change is out, with a surprisingly affordable sticker price on climate protection.

ClimateProgress:

The U.N. Intergovernmental Panel on Climate Change (IPCC) has just issued its third of four planned reports. This one is on “mitigation” — “human intervention to reduce the sources or enhance the sinks of greenhouse gases.”

.. The first report warned that continued inaction would lead to 9°F warming (or higher) for most of the U.S. and Northern Hemisphere landmass, resulting in faster sea level rise, more extreme weather, and collapse of the permafrost sink, which would further accelerate warming. The second report warned that this in turn would lead to a “breakdown of food systems,” more violent conflicts, and ultimately threaten to make some currently habited and arable land virtually unlivable for parts of the year.

Now you might think it would be a no-brainer that humanity would be willing to pay a very high cost to avoid such catastrophes and achieve the low emission “2°C” (3.6°F) pathway in the left figure above (RCP2.6 — which is a total greenhouse gas level in 2100 equivalent to roughly 450 parts per million of CO2). But the third report finds that the “cost” of doing so is to reduce the median annual growth of consumption over this century by a mere 0.06%.

You read that right, the annual growth loss to preserve a livable climate is 0.06% — and that’s “relative to annualized consumption growth in the baseline that is between 1.6% and 3% per year.” So we’re talking annual growth of, say 2.24% rather than 2.30% to save billions and billions of people from needless suffering for decades if not centuries. As always, every word of the report was signed off on by every major government in the world.

Slate:

Still, amid all the imminent-disaster talk there is some room for guarded optimism. It’s still technically possible to avert catastrophe but in order to do that low-carbon energy has to triple or quadruple by 2050. That implies “an energy revolution ending centuries of dominance by fossil fuels and which will require major political and commercial change,” notes the Guardian. It sounds daunting but making the switch is more affordable than many seem to think. Making a major switch to renewable energy would decrease expected annual economic growth rates by a mere 0.06 percent. And that estimate does not calculate the economic benefit of cutting emissions, which could very well be higher than the costs. In fact, societies would likely be 5 percent poorer if nothing is done to protect the climate, notes the Times.

“Climate policy isn’t a free lunch but could be lunch [that’s] worthwhile to buy,” said Ottmar Edenhofer, one of three co-chairs of the Intergovernmental Panel on Climate Change working group, according to the Wall Street Journal. And it’s a lunch that is also becoming cheaper to buy. One of the most optimistic parts of the report notes that the costs of renewable energy have been on a steep decline in recent years, making its widespread deployment much more affordable than in the past.

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33 Responses to “Costs of Curing Climate Change: Low”

  1. jimbills Says:

    There is a back story to this story:
    http://www.theguardian.com/environment/2014/mar/28/ipcc-climate-costs-estimate-meaningless

    Basically, an IPCC economist thought the report was all ‘doom and gloom’, so he wanted to cheer it up a bit. When there was backlash to his estimate that mitigation would cost 0.2% to 2.0%, he backed out in a huff:
    http://www.finfacts.ie/irishfinancenews/article_1027490.shtml

    Now, the report says it will cost 0.06%. It just gets better and better!

  2. adelady Says:

    I think Richard Alley’s classic comparison to the costs of dealing with other forms of human waste should always get a mention in this discussion.

  3. redskylite Says:

    “We need to get beyond the concept that progressive climate change policy is bad for business: it can be a huge driver of innovation and create opportunities for growth and prosperity. Conversely, there isn’t an organization I know of which isn’t already being impacted by climate change at some level.” – Niall Dunne, chief sustainability officer at BT. BT also signed on to the trillion ton carbon cap letter.”

    http://www.theguardian.com/environment/2014/apr/08/bt-shell-corporates-trillion-tonnes-carbon


  4. […] 2014/04/13: PSinclair: Costs of Curing Climate Change: Low […]


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