Eco-nomics: What it takes to lower our greenhouse gas emissions

By Paul Roberts / For The Herald

Responding to climate change requires three strategies: mitigation by reducing greenhouse-gas emissions; adaptation by preparing for climate-influenced events; and leadership through the political will to act.

Let’s look at mitigation.

Current global warming and climate-influenced events (heat, fires, storms, hurricanes and flooding) are the result of a 1 degree Celsius (2 degrees Fahrenheit) temperature rise baked into the atmosphere from burning fossil fuels that emit greenhouse gases (GHG). These events are accelerating, along with adverse health and economic consequences.

The scientific community, the Intergovernmental Panel on Climate Change and the Paris agreements set targets to limit warming to between 1.5 and 2 degrees Celsius to avoid dangerous tipping points.

Limiting warming requires rapid reductions in GHG emissions by transitioning to a clean energy economy. The target most often referenced is reducing GHG emissions to net zero by 2050.

Pedal to the metal: To mitigate climate change, we need to take our foot off the gas — literally — and apply the brakes. In 2008 Dr. Stephen Palumbi, Stanford professor of marine biology, wrote an article for Brookings describing “climate stopping distance,” what it will take to address climate change. He points out that “1) it takes a while to stop, and 2) poor judgment will lead to a dangerously counter-productive skid.” Well, 15 years later, we have not yet taken our foot off the gas.

Overall, GHG emissions continue to rise globally. China, the U.S. and India account for more than 40 percent of global emissions. The top 10 nations (China, the U.S., India, the European Union, Russia, Japan, Brazil, Indonesia, Iran and Canada respectively) account for more than two-thirds of global emissions. The bottom 100 countries account for less than 3 percent. Carbon emissions in the U.S. have slightly decreased. However, methane emissions have risen at record levels and are many times more potent than carbon dioxide. While China, the U.S. and India are the largest emitters of carbon dioxide4, Canada, the U.S., Australia and Russia have the largest per capita emissions.

Meeting the goal of 1.5 degrees of warming and net zero by 2050 is an immense challenge.

The transition to net zero: It won’t be easy or cheap. It requires advancements in engineering, research and development, economics, finance and political will. It’s a high-wire balancing act between maintaining a functioning economy and a livable environment.

The path forward requires a rapid transition from fossil fuels to renewables and clean energy. Not all commodities or sectors can quickly transition. Commodities such as steel and cement, and sectors such as aviation, maritime shipping and medicine will require innovations not yet available or not yet at scale. More on this in future articles.

Transition requires a series of steps. Technologies and products must be developed (R&D), tested and produced at sufficient scale for sectors to make the transition. The emergence of electric vehicles is an example we are witnessing in real time. It takes time and financial resources to develop and deliver new products to markets at competitive prices. Accurately pricing fossil fuels is a critical factor to incentivize and speed up this transition. And, speed matters!

The true cost in burning fossil fuels is not the only price we pay at the pump. That price reflects the cost to extract, refine and deliver that gallon. It does not include the cost of emitting carbon into the atmosphere. Those costs are passed on to the environment, economy and society. They are global in nature, experienced — and paid — by all.

Economists call this “externalizing costs” and climate change is a textbook example. As billions of people consume fossil fuels, billions of tons of carbon and GHGs are emitted into the atmosphere. The total costs, including potentially irreversible damage to the environment and the economy, are distributed to society as a whole. Those who polluting the least bear a disproportionate burden. They include poor people and poor nations.

The costs of carbon: This is called the social cost of carbon, and it is increasing along with the impacts of climate change. Economists and environmentalists largely agree the social cost of carbon must be built into the economy if we are to reach net zero by 2050.

The first step is to stop subsidizing fossil fuels. The second is to price carbon to reflect its true costs. As early as 1989, The Economist magazine argued that the only way for governments to stop global warming was to put a price on pollution, preferably with a carbon tax.

Many countries have moved to price carbon including China, the world’s biggest emitter, the E.U., Denmark, Sweden and the United Kingdom. As the price of emitting GHGs increases, the level of emissions will fall, creating a disincentive for fossil fuels and an incentive for clean energy. Revenues from pricing carbon are used to support the transition to clean energy, and support those most affected and dependent on fossil fuels to transition as well.

From an economics and environmental perspective, pricing carbon is an obvious policy choice. But from a political perspective, pricing carbon is a third rail. Defining economic health in terms of the price of a gallon of gas will increase fossil fuel consumption, GHGs and global temperatures. This is a business-as-usual narrative, heavily promoted and funded by the oil industry, ultimately harming the environment and the economy. More on that in the next article: The Elephant in the Room.

We know what the climate will do on a business as usual path. We still have time to choose a better path, but the time to act is now.

Paul Roberts is retired and lives in Everett. His career spans over five decades in infrastructure, economics and environmental policy including advising Washington cities on climate change.

Eco-nomics

“Eco-nomics” is a series of articles exploring issues at the intersection of climate change and economics. Climate change (global warming) is caused by greenhouse gas emissions —carbon dioxide and methane chiefly — generated by human activities, primarily burning fossil fuels and agricultural practices. Global warming poses an existential threat to the planet. Successfully responding to this threat requires urgent actions — clear plans and actionable strategies — to rapidly reduce GHG emissions and adapt to climate-influenced events.

The Eco-nomics series, to be published every other week in The Herald, is focusing on mitigation and adaptation strategies viewed through the twin perspectives of science and economics.

Read the series thus far at tinyurl.com/RobertsEco-nomics1, tinyurl.com/RobertsEco-nomics2, tinyurl.com/RobertsEco-nomics3 and tinyurl.com/RobertsEconomics4.