The regional economic impact of reducing greenhouse gas emissions: Western Australia

This study analyses the general-equilibrium impacts of an international climate change response policy on the economy of Western Australia (WA), one of the most mining-based and energy-intensive states of Australia. It finds that emissions would fall by up to 11% from the base level in WA. However, such environmental benefits emanate at some costs to the state economy; in terms of foregone gross state product, the costs are up to 3% of the base level. Indeed, the actual costs and benefits depend on the precise design of the climate change response policy as well as on the other policies within which it operates. For example, when emission quota permits are sold to industries and no tradeable carbon credits (i.e. credits for the carbon sequestrated in Kyoto forests) are granted, emissions decline by about 8% and GSP falls by about 3% of the base levels. If carbon credits are tradeable, however, the environmental benefits could be increased and the GSP cost could be reduced substantially. Also, the reduced economic activity caused by emission abatement results in a modest fall in net government revenue, despite the additional revenue from permit sales in some cases. Accordingly, government’s fiscal package surrounding the emission permits would influence the emission abatement impacts on the economy. With regard to the effects on the structure of the state economy, the oil and gas industry suffers only a slight contraction but the energy-supplying sector as a whole contracts substantially. It is therefore not surprising that the impacts on the WA economy of curbing emissions by energy and transport industries alone are quite significant when compared to those resulted from all industries’ compliance with the abatement scheme. It needs to be noted that the model projections analysed in the paper are based on simplifying assumptions and tentative scenarios, and hence should be viewed with caution and not be understood as unconditional forecasts.     

Project coordinators’ views on climate adaptation costs and benefits – justice implications

ABSTRACT

As local climate adaptation activity increases, so does the number of questions about costs, benefits, financing and the role that economic considerations play in adaptation-related decision-making and policy. Through five cases, covering a range of climate risks and types of adaptation measures, this paper critically examines Swedish project coordinators’ perceptions of costs and benefits in already-implemented climate adaptation measures. Our study finds that project coordinators make use of different system boundaries – on temporal, geographical and administrative scales – in their cost/benefit evaluations, making the practice of determining adaptation costs arbitrary and hard to compare. We further demonstrate that the project coordinators interpret costs and benefits in a manner that downplays the intangible environmental and social costs and benefits arising from the adaptation measures, despite their own experience of how such measures negatively impact upon social value. The exclusion of social and environmental costs and benefits has severe implications for justice, as it can bias decisions against people and ecosystems that are affected negatively. Based on the findings, we propose three tentative social justice dilemmas in local climate adaptation planning and implementation: 1. Cost and benefit distribution across scales; 2. The identification and valuation of non-market effects; and 3. The equitable allocation of costs and benefits.     

Ecosystem services in infrastructure planning – a case study of the projected deepening of the Lower Weser river in Germany

We consider how ecosystem services can be incorporated into water infrastructure planning by studying the projected deepening of the Lower Weser river channel in Germany. We recalculate the project's benefit–cost ratio by integrating the monetary value of changes in different ecosystem services, as follows: (1) the restoration costs of a mitigation measure for a loss in fresh water supply for agricultural production in the estuary region, (2) the costs of a loss in habitat services, transferring the willingness to pay from a contingent valuation study to the area assessed in the environmental impact assessment, and (3) the benefits of emissions savings induced by more efficient shipping, taking a marginal abatement cost approach. We find that including monetary values for ecosystem service changes leads to a substantial drop in the benefit–cost ratio. On this basis, we argue for a reform of the standard cost–benefit analysis to facilitate more complete welfare assessments.     

Uncertainty in exhaustible natural resource economics: The irreversible sunk costs of Hotelling

According to Pindyck (2007) there are three important aspects of uncertainly in environmental economics: (1) the benefits and costs of environmental policy tend to be highly non-linear, (2) environmental policy tends to involve important irreversibilities, where investment in pollution abatement can impose an irreversible, sunk cost on society, and where certain pollutants can stay in the environment forever and build up to cause even more future harm in which case investment in abatement can cause an irreversible, sunk benefit to society, and (3) environmental policy involves long time horizons and yet the discount rate society should use is uncertain for determining the net present value of costs and benefits of pollution abatement. These same uncertainties also affect non-renewable, exhaustible, natural resource economics and in particular the use of the Hotelling rule: (1) the costs, benefits and transversality conditions of using the Hotelling rule can be highly non-linear, (2) the Hotelling rule involves important sunk cost irreversibilities, which will be explained here, and (3) the Hotelling rule can involve long time horizons with uncertain discount rates. All three of these problem make it extremely difficult for a market to use in any way the Hotelling rule, yet by the sheer number of articles in non-renewable natural resource economics, one would believe that it is the basis of all resource markets. In this article, we concentrate on the sunk cost irreversibilities of using the Hotelling rule. The idea of the Hotelling rule is to optimally store a non-renewable resource, but the optimization is highly dependent on the actual reserves that are available to extract. However, reserves of underground exhaustible resources are often unobservable at the beginning stages of extraction which makes using the Hotelling Rule difficult.     

二氧化碳回收技术进展

CO2的过量排放对全球的气候变暖有着不可推卸的责任,同时CO2又是一种重要的碳资源,对它的回收和利用将具有很大的经济效益和社会效益。CO2回收的方法主要是膜吸收法、变压吸附法、化学吸收法和低温分离法,特别是离子液体对CO2的吸收,为CO2的减排提供了良好的手段。     

Southwest climate gap: poverty and environmental justice in the US Southwest

This article examines the “climate gap” in the Southwest US (Arizona and New Mexico), referring to the “disproportionate and unequal implications of climate change and climate change mitigation” for “people of color and the poor” [Shonkoff, S.B., et al., 2011. The climate gap: environmental health and equity implications of climate change mitigation policies in California. Climatic Change, 109 (Suppl. 1), S485–S503]. The climate and poverty relationship is examined using multi-scaled analysis across three indicators of climate vulnerability, focusing on connections to health, food, and energy during the period 2010–2012. We provide an overview of climate-related social vulnerability in the Southwest based on available federal, state, and county-level census data. We then summarise the results from a stakeholder workshop and in-depth interviews about climate vulnerabilities with social service providers in southern Arizona. We identify a significant Southwest climate gap based on census data and interview findings about climate vulnerability especially relating to high levels of poverty, health disparities, and increasing costs for energy, water, and food. We find that grassroots and community organisations have mobilised to respond to climate and social vulnerability, yet resources for mitigation and adaptation are insufficient given the high level of need. Confronting a changing climate that is projected to be hotter, drier, and with the potential to reach new thresholds, we suggest that more research needs to be done to understand the social and spatial characteristics of climate risk and how low-income populations embody and experience climate risk, and adapt to a changing climate.     

The benefits and costs of reducing emissions from the electricity sector

Recent federal policy proposals to reduce emissions of sulfur dioxide (SO(2)), nitrogen oxides (NO(x)), and mercury from the US electricity sector promise important improvements in air quality and reductions in acid deposition. The cost of achieving these reductions depends on the form and stringency of the regulation. In this research, we analyze the economic benefits and costs of the US Environmental Protection Agency's (EPA's) Clean Air Interstate Rule (CAIR) as characterized in the supplemental rule proposed in June 2004, and the Clean Air Mercury Rule (CAMR) as proposed in February 2004. The assessment integrates a model of the electricity sector, two models of atmospheric transport of air pollutants, and a model of environmental and public health endpoints affected by pollution. We model explicitly the emissions of SO(2), NO(x), mercury and carbon dioxide (CO(2)) and the effects of changes in emissions of SO(2) and NO(x) on environmental and public health. The manner in which mercury emissions are regulated will have important implications not only for the cost of the regulation, but also for emission levels for SO(2) and NO(x) and where those emissions are located. We find the economic benefits of CAIR and CAMR are far greater than the costs. Recent estimates of benefits of reductions in mercury and acidification indicate that our model captures the lion's share of quantifiable benefits. We also find that the EPA would have been justified on economic grounds in pursuing additional SO(2) emissions reductions beyond the requirements of CAIR.     

Assessing the costs for adaptation of marine constructions to sea-level rise

Marine constructions are highly vulnerable to climate change and sea-level rise (SLR), leading to increased risk rates of destruction and the potential closure of ports, harbors, and marinas along the coast. We present a cost-adjustment analysis for such constructions along the south-eastern Mediterranean coast, which takes into account the physical characteristics of the constructions, and environmental uncertainty factors. At 0.5 m SLR, the estimated adjustment cost is USD 280 million, and at 1 m SLR, the estimated cost is USD 505 million. These costs are equivalent to 0.091% and 0.165% of the Israeli gross domestic production, respectively. Although high, these adjustment costs are lower than the costs of future damage that will accrue if we fail to act. This implies that the adaptation-policy approach to controlling for the risk of SLR will provide benefits to the economic marine sectors and the public at large.     

Transaction costs and sequential bargaining in transferable discharge permit markets

Market-type mechanisms have been introduced and are being explored for various environmental programs. Several existing programs, however, have not attained the cost savings that were initially projected. Modeling that acknowledges the role of transactions costs and the discrete, bilateral, and sequential manner in which trades are executed should provide a more realistic basis for calculating potential cost savings. This paper presents empirical evidence on potential cost savings by examining a market for the abatement of sediment from farmland. Empirical results based on a market simulation model find no statistically significant change in mean abatement costs under several transaction cost levels when contracts are randomly executed. An alternative method of contract execution, gain-ranked, yields similar results. At the highest transaction cost level studied, trading reduces the total cost of compliance relative to a uniform standard that reflects current regulations.     

应对气候变化法的立法探究

为了实现碳排放达峰目标和碳中和愿景,明确应对气候变化的法律地位、工作目标和法律要求,规定部门职责及温室气体排放权的法律属性与交易机制,分解工作目标并开展评价考核,彰显国家应对气候的法治决心,亟须制定综合性基础法律——应对气候变化法。该法的制定已具备充足的研究起草基础和下位法支撑,建议尽快纳入全国人大常委会立法计划,并启动《环境保护法》等相关法律的修改。本文建议,将低碳发展和碳排放达峰、碳中和等纳入立法目的,设立总则、规划与标准、气候变化减缓、气候变化适应、管理和监督、国际合作、法律责任、附则八章,合理设立规范重点。健全统一监管与部门分工负责的体制和基金筹集、市场交易、社会共治等机制,全面构建国内应对气候变化管理制度体系,部署国际协商与合作措施,设置地方政府工作目标责任,对违法行为规定罚则。     

Integrating economic and biophysical data in assessing cost-effectiveness of buffer strip placement

The European Union Water Framework Directive (WFD) requires Member States to set water quality objectives and identify cost-effective mitigation measures to achieve "good status" in all waters. However, costs and effectiveness of measures vary both within and between catchments, depending on factors such as land use and topography. The aim of this study was to develop a cost-effectiveness analysis framework for integrating estimates of phosphorus (P) losses from land-based sources, potential abatement using riparian buffers, and the economic implications of buffers. Estimates of field-by-field P exports and routing were based on crop risk and field slope classes. Buffer P trapping efficiencies were based on literature metadata analysis. Costs of placing buffers were based on foregone farm gross margins. An integrated optimization model of cost minimization was developed and solved for different P reduction targets to the Rescobie Loch catchment in eastern Scotland. A target mean annual P load reduction of 376 kg to the loch to achieve good status was identified. Assuming all the riparian fields initially have the 2-m buffer strip required by the General Binding Rules (part of the WFD in Scotland), the model gave good predictions of P loads (345-481 kg P). The modeling results show that riparian buffers alone cannot achieve the required P load reduction (up to 54% P can be removed). In the medium P input scenario, average costs vary from ￡38 to ￡176 kg P at 10% and 54% P reduction, respectively. The framework demonstrates a useful tool for exploring cost-effective targeting of environmental measures.     

Development and Climate Change: A Mainstreaming Approach for Assessing Economic,Social, and Environmental Impacts of Adaptation Measures

The paper introduces the so-called climate change mainstreaming approach, where vulnerability and adaptation measures are assessed in the context of general development policy objectives. The approach is based on the application of a limited set of indicators. These indicators are selected as representatives of focal development policy objectives, and a stepwise approach for addressing climate change impacts, development linkages, and the economic, social and environmental dimensions related to vulnerability and adaptation are introduced. Within this context it is illustrated using three case studies how development policy indicators in practice can be used to assess climate change impacts and adaptation measures based on three case studies, namely a road project in flood prone areas of Mozambique, rainwater harvesting in the agricultural sector in Tanzania and malaria protection in Tanzania. The conclusions of the paper confirm that climate risks can be reduced at relatively low costs, but the uncertainty is still remaining about some of the wider development impacts of implementing climate change adaptation measures.     

Value chain for next-generation biofuels: resilience and sustainability of the product life cycle

Multiple factors including climate change, price uncertainties, and geopolitical instability have prompted many industries to investigate the feasibility of replacing traditional petroleum-based fuels with biofuel alternatives. However, to make this transition successful, these new biofuels must be environmentally sustainable and the necessary support infrastructure must be in place to make the production, distribution, and storage of these biofuels technologically feasible and cost effective. Developing a value chain, spanning from feedstock production to distribution to end users, requires garnering buy-in from multiple stakeholders by demonstrating environmental, economic, and social benefits and incentives. Two critical factors are the environmental benefits achieved from the use of the biofuel technology and the degree of resilience of the value chain to emergent conditions to ensure steady supply to consumers. Moreover, different biofuel pathways have different costs, benefits, and risks which must be compared. In this paper, we describe how environmental sustainability can be modeled using life cycle assessment (LCA) and how the resilience of value chain initiatives can be modeled using a scenario-based decision model. We then describe how sustainability and resilience assessments can be integrated in an iterative, anticipatory LCA framework. These assessments can be used as the basis for a business case for various investments, as well as a means for promoting responsible innovations, with the aviation industry used as a case study.     

The scope for regulatory incentives to encourage increased efficiency of input use by farmers

Managing diffuse water pollution from agricultural land continues to be one of the more intractable challenges for environmental policy. The advent of the Water Framework Directive places the onus on EU member states to identify reasons why water bodies fail or are at risk of failure to meet good ecological status. In such cases, programmes of measures are to be enacted to mitigate the causes at least cost. Failing this, users may ultimately be faced with the full costs of pollution. This paper considers the scope for measures that address nitrogen and phosphorus pollution at source. Specifically the paper relates the diffuse pollution problem to the extent of over application of nitrogen and phosphorus. Data envelopment analysis applied to English cereal and dairy farmers, provides an indication of resource use and evidence of over application. This inefficiency provides a potential basis for either a least cost abatement approach using effective information and advice, or alternatively a pollution charge.     

中央空调节能减排技术改造——实例探析

通过实施中央空调系统全方位节能减排技术，优化电网安全用电，节省电费开支，减少建设成本。不仅可收到可观的经济效益，而且能取得良好的社会效益，是我国建设资源节约型、环境友好型社会的必然要求。节能减排，减少污染，应立足本职．把节能减排工作抓紧抓好，推而广之。     

Towards global climate change mitigation: assessment of an afforestation option for Nigeria

This paper assesses the potential of an intensive afforestation program as a measure of reducing the atmospheric concentration of carbon in Nigeria. The results presented are based on the recently completed Nigerian Country Studies Program on Climate Change Mitigation. A comprehensive mitigation analysis process (COMAP) model was employed to carry out detailed cost/benefit evaluation of the mitigation option. The end-use based scenario adopted was considered the most appropriate strategy to sustainably implement the mitigation option in Nigeria.The analyses showed that the country could significantly reduce net carbon emission while at the same time meet all her essential domestic wood needs, if approximately 7.5×10⁶ ha of wasteland could be committed to an afforestation program over the 40 year period of projection. The initial cost of establishing such forest plantations, taking cognisance of the opportunity cost of land averaged at about US$500/ha, or in carbon terms, a unit cost of about $13 per tonne of carbon. In terms of carbon flow, if all the end-product based plantations considered (i.e. fuelwood, poles, pulpwood, sawlogs and veneer) were fully established and maintained, it was estimated that by the year 2030, the total carbon stored in the afforested land would be about 638.0×10⁶ t of carbon with an annual incremental rate of 16.0×10⁶ t of carbon. Other economic indicators (i.e. net present value of benefits, present value of costs and benefit for reduced atmospheric carbon) when evaluated showed that the afforestation option could be economically viable even when the investment capital was discounted at rates ranging from 9 to 33 percent for different wood products. It should be noted, however that implementation of such a program would require huge sums of money and a high degree of commitment on the part of Federal, State and Local governments if the associated financial, social and environmental benefits were to be derived.     

Making cities resilient to climate change: identifying “win–win” interventions

Urbanisation is truly a global phenomenon. Starting at 39% in 1980, the urbanisation level rose to 52% in 2011. Ongoing rapid urbanisation has led to increase in urban greenhouse gas (GHG) emissions. Urban climate change risks have also increased with increase in climate-induced extreme weather events and more low-income urban dwellers living in climate sensitive locations. Despite increased emissions, including GHGs and heightened climate change vulnerability, climate mitigation and adaptation actions are rare in the cities of developing countries. Cities are overwhelmed with worsening congestion, air pollution, crime, waste management, and unemployment problems. Lack of resources and capacity constraints are other factors that discourage cities from embarking on climate change mitigation and adaptation pathways. Given the multitude of problems faced, there is simply no appetite for stand-alone urban climate change mitigation and adaptation policies and programmes. Urban mitigation and adaptation goals will have to be achieved as co-benefits of interventions targeted at solving pressing urban problems and challenges. The paper identifies administratively simple urban interventions that can help cities solve some of their pressing service delivery and urban environmental problems, while simultaneously mitigating rising urban GHG emissions and vulnerability to climate change.     

Price-based vs. quantity-based environmental regulation under Knightian uncertainty: an info-gap robust satisficing perspective

Conventional wisdom among environmental economists is that the relative slopes of the marginal social benefit and marginal social cost functions determine whether a price-based or quantity-based environmental regulation leads to higher expected social welfare. We revisit the choice between price-based vs. quantity-based environmental regulation under Knightian uncertainty; that is, when uncertainty cannot be modeled with known moments of probability distributions. Under these circumstances, the policy objective cannot be to maximize the expected net benefits of emissions control. Instead, we evaluate an emissions tax and an aggregate abatement standard in terms of maximizing the range of uncertainty under which the welfare loss from error in the estimates of the marginal benefits and costs of emissions control can be limited. The main result of our work is that the same criterion involving the relative slopes of the marginal benefit and cost functions determines whether price-based or quantity-based control is more robust to unstructured uncertainty. Hence, not only does the relative slopes criterion lead to the policy that maximizes the expected net benefits of control under structured uncertainty, it also leads to the policy that maximizes robustness to unstructured uncertainty.     

A bioeconomic model for estimating the benefits of acid rain abatement to Salmon fishing: a case study in South West Scotland

The United Kingdom, under the Large Combustion Plant Directive of the European Community, is committed to cutting sulphur dioxide (SO2) emissions by 60% of 1980 levels by the year 2003. In order to justify this action and to support new decisions on further emission reductions, policy makers require knowledge of the economic benefits of abatement. Benefit estimates for the recovery of freshwater fish populations present difficulties since the effect of reduced acid deposition on environmental processes is complex and because fishery records are often inadequate or absent. This paper predicts the economic benefits of acid rain abatement to the rod and line salmon fishery of Galloway, South West Scotland. It achieves this by linking output on long term changes in water chemistry and fish population status from MAGIC, a process based catchment model for acidification, with catch and market value data. Predicted increases in the market value of the fishery are presented and the role of the model in economic analysis of environmental policy discussed.     

Addressing climate change: Determinants of consumers' willingness to act and to support policy measures

Consumers influence climate change through their consumption patterns and their support or dismissal of climate mitigation policy measures. Both climate-friendly actions and policy support comprise a broad range of options, which vary in manifold ways and, therefore, might be influenced by different factors. The aims of the study were, therefore, two-fold: first, we intended to find a meaningful way to classify different ways of addressing climate change. Second, we aimed to examine which determinants influence people's willingness to engage in these behaviors. We conducted a large-scale mail survey in Switzerland in which respondents rated, among other items, their willingness to act or support a range of possible actions and mitigations measures. A principal component analysis indicated that a distinction in terms of a behavior's directness as well as a differentiation according to perceived costs seem to be appropriate to classify climate-friendly actions. Multiple regression analyses showed that perceived costs and perceived climate benefit turned out to be the strongest predictors for willingness to act or to support climate policy measures. The strong influence of perceived climate benefit might reflect a strategy of reducing cognitive dissonance. As high-cost behaviors are more difficult to adopt, consumers may reduce dissonance by dismissing high-cost behaviors as not effective in terms of climate mitigation. Political affiliation proved to be another strong determinant of willingness to act or support. Participants on the right wing were less willing to show indirect climate-friendly behaviors, change their mobility behaviors, and to support any type of climate mitigation policy measures. Climate-friendly low-cost behaviors, however, were not influenced by political affiliation.