Larger climate spending can give reasonable returns: study

New research means policymakers can decide on the extent of certainty for achieving their reduction targets

Date2009, March 02
 

Tue, Dec 23 2008. 12:26 AM IST by Seema Singh

Bangalore: The costs and benefits of climate change mitigation programmes continue to confuse governments.

New research in Tuesday’s issue of the Proceedings of the National Academy of Sciencessays that this cost may not be as high as previously estimated and that a larger investment in reducing global warming enhances the chance of achieving a desired result.

Threshold limit: Smoke comes out of the chimneys of a factory in China. The research estimates that investing in emission reduction will start to pay off when its concentration exceeds 550 parts per million of volume. Lucas Schifres / Bloomberg
Threshold limit: Smoke comes out of the chimneys of a factory in China. The research estimates that investing in emission reduction will start to pay off when its concentration exceeds 550 parts per million of volume. Lucas Schifres / Bloomberg

“Our work suggests that spending larger amounts of money to control carbon dioxide levels or temperatures skewed by climate change may prove worthwhile to a government or a corporation,” says lead author Michiel Schaeffer of the Wageningen University and Research Centre in the Netherlands.

While this contrasts with the earlier viewpoint that costs increase exponentially when trying to reach low greenhouse gas concentration targets, it doesn’t challenge the conventional wisdom. “The latter suggests that it will be good to do a bit of emission reductions, but stop at a value, for example, 500 ppmv (parts per million of volume) because the marginal cost increase at lower concentrations are rapidly increasing,” says Schaeffer.

What his team suggests is that doing “a bit will get you nowhere”, something they call as an “investment threshold”.

“It is exactly from roughly 550 ppmv onwards that investments will start to really pay off, entering a regime where the investment return responds linearly to the level of investment,” Schaeffer adds.

The present atmospheric concentration of carbon dioxide is about 385 ppmv and the Intergovernmental Panel on Climate Control, or IPCC, gives a wide range of carbon dioxide scenario—541-970 ppmv by 2100. However, it is estimated that 550 ppmv is the threshold which could keep atmospheric temperature increases below two degrees Celsius in the long term.

Schaeffer suggests a new approach and shifts the focus of discussion—from deciding what is an appropriate target to actually choosing a target (in emission or temperature control) and deciding what is the probability of meeting that target, says Anand Patwardhan, professor at SJM School of Management, Indian Institute of Technology, Bombay, and one of the co-authors of the IPCC Fourth Assessment Report, which was released in September 2007. This report said it is not yet possible to find an unambiguous way of emission reduction or reaching a stabilization level where benefits exceed cost.

The new research means policymakers can decide if they want to be 80%, 60% or 50% certain of achieving their targets and then calculate the cost, explains Patwardhan. “This will help framing the question in terms of certainty; if you double the certainty, you double the cost.”

This might not aid in the fundamental argument today, which revolves around the global target, global gross domestic product and laying down the basic principle on which to allocate resources to fight climate change.

“But this will help in the adaptation discussion and in goal setting,” says Patwardhan. “This is for the global decision maker.”

Atul Kumar at The Energy and Resources Institute in New Delhi says that though the theory is broadly correct, it will add to the controversy in the political process during negotiations.

© 2007, HT Media Ltd
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