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Choosing Climate Change Strategies

Climate change is a terrifying prospect. And like any serious risk that civilization has to counter, it will require not just grit and will power and political skill, but serious quantitative analysis. But the prerequisite of that analysis is to have some kind of framework to think about the problem. You have to be asking the most useful empirical question. Even if such a framework isn’t stated out loud, it’s always implicit. For example, let’s say someone tells you they’ve stopped flying in airplanes because of the massive carbon footprint. Their implied framework is: citizens should find the biggest portion of their carbon footprint, and try to eliminate that first. Here I argue that this way of thinking—focusing on the plurality of individual emissions—is not the best framework with which to fight climate change.

A more useful approach is to look at a metric called the marginal abatement cost curve. This provides what climate change mitigation experts consider to be a good framework for focusing our attention and prioritizing political capital (and, like, actual capital). In this case, the question that sets our framework of thought is: “What’s the least expensive thing we can do to lower emissions, per unit of CO2?”

Here is the concept. Any action or technology can be categorized by two numbers. First, the total quantity of CO2 that could reasonably be eliminated. And second, how much each CO2 molecule would cost to eliminate. (By eliminate, I mean either not emitting it in the first place or capturing it from the atmosphere. The former approaches tend to be much less expensive.)

For example, let’s say reforestation in the US has the potential to reduce net emissions by about 50 megatons of CO2 per year. On average, let’s say the cost would be something like $20 per megaton. (Don’t quote any of these numbers; they’re eyeballed based on my reading of small plots in this book.) If you have a finite amount of society’s wealth that you want to spend to fight climate change, then you could compare these numbers against other technologies. For instance, you might analyze the abatement potential and cost of requiring all freight trucks to become electric.

These two dimensions—cost and total possible CO2 reduction—can take us pretty far in decision-making. Take aviation again. Commercial flight is about 2-3% of global emissions, which is not small. But it’s also extremely expensive to decarbonize, if that’s even possible with today’s technology. And reducing flight hours by even half in the next fifteen years simply doesn’t seem politically feasible or desirable. But consider that all global ground transportation contributes more than 10% of emissions, and that ground transport reductions are much cheaper per CO2 molecule. It should be a no-brainer that we focus more of our finite attention on ground transportation than on aviation. At least for now. (This is why the “flygskäm” trend that supposedly began in Sweden is not particularly productive for lowering emissions.)

One cool thing is that some technologies have negative cost. Lots of them do. For example, changing indoor lighting from incandescent to LED greatly reduces CO2 emissions and it also saves you money in the long run. You’re using less energy over the years, which leads to a smaller electricity bill. Other tech with negative costs are car fuel efficiency and insulation for buildings. The negative emissions technologies should be done first. Another no-brainer.

Note that we don’t care where the CO2 comes from. Every CO2 molecule is the same. We just know we need to reduce them as much as possible, as soon as possible. And I hope it’s obvious that we should usually go for the cheapest reductions first. GDP is limited, there’s a limited amount of capital available, and there’s a limited amount of patience for higher costs of living.

This concept gets more powerful.

My real impetus for writing this was to show you a new spin on this framework. Instead of studying technologies, we can study policies. Instead of looking at CO2 cost and quantity for things like electric vehicles or nuclear plants, we can study these two dimensions for initiatives like new taxes, industry regulation, or new building codes. For example, new building regulations might have an abatement cost of −$300 per ton CO2 (negative cost) and a total abatement potential of 20 megatons. The more expensive side of the spectrum might include forcing heavy industry to switch from gas to electricity where possible, which might have as much as 50 megatons per year abatement potential but at a high cost of +$350 per ton. The point is to analyze the types of initiatives that tend to be codified in law and cover an interplay of technologies, instead of analyzing specific technologies themselves.

Comparing many different policies leads to a policy cost curve, which is much easier to turn directly into government action. This is a big deal, because governments work by implementing policies, not by directly creating or replacing technology. As the authors write in Designing Climate Solutions, “Although it is valuable to understand the technological potential for emissions reductions from different technologies, this does not answer the critical ‘what to do on Monday morning’ question facing policy makers: Which policies can they use to most cost-effectively these emission-reducing technologies to be deployed?” The Congressional staffers in Washington, or the council members in your city, or the European Union regulators, all can use a policy cost curve to guide new laws.

This is a relatively new research development that, as far as I can tell, has been pioneered primarily by Energy Innovation (a research non-profit in California). When I was a teaching assistant for an online energy course in 2015, the instructor taught the technology cost curves but not the policy ones, because such analyses probably didn’t exist at the time. I hope that we begin to see policy cost curves in courses and textbooks on energy and the environment.

(Keep in mind the standard caveats. First, we’re not really considering CO2 emissions but CO2 equivalent, often written CO2e, which counts CO2 and methane and other molecules that trap heat in the atmosphere. Second, none of this should be taken to mean that we ignored expensive emissions like flights—it just means we put them further down the priority list. Third, the costs we’re talking about are effectively costs to society as a whole, not necessarily costs to government treasuries. These include consumer taxes, mandates that force the purchase of more expensive equipment, and effects on economic growth.)

The lessons of this framework are pretty clear. If you’re going to write an op-ed piece, or lecture your family about going green, or write to your Congressperson or Mayor about climate change, don’t just pick out some chunk of emissions that you perceive to be important. Look at the abatement cost curve. Or even better, find out if there’s something like a policy cost curve that would apply to your geographical area. The pages of Designing Climate Solutions and other sources give these results based on economic models and painstaking analyses of existing policies. We don’t have time to complain about the most expensive 3% percent when the least expensive 50% of emissions are screaming to be dealt with. Once the cheapest emissions reductions have been aggressively pursued, we can then use society’s wealth to tackle the most expensive parts. Zero emissions is the necessary goal for civilization to survive, but if we don’t have an intelligent strategy, we won’t reach that goal in time.


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