Findings

Conversion

Kevin Lewis

August 19, 2019

The Cost of a Carbon-Free Electricity System in the U.S.
Geoffrey Heal
NBER Working Paper, July 2019

Abstract:
I calculate the cost of replacing all power stations in the U.S. using coal and gas by wind and solar power stations by 2050, leaving electric power generation in the U.S. carbon free. Allowing for the savings in the cost of fossil fuel arising from the replacement of fossil fuel plants this is roughly $150 billion annually. Allowing in addition for the fact that most fossil plants in the U.S. are already old and would have to be replaced before 2050 even if we were not to go fossil free, this annual cost is reduced to $23 billion.


Long-Term Macroeconomic Effects of Climate Change: A Cross-Country Analysis
Matthew Kahn et al.
University of Southern California Working Paper, July 2019

Abstract:
We study the long-term impact of climate change on economic activity across countries, using a stochastic growth model where labour productivity is affected by country-specific climate variables - defined as deviations of temperature and precipitation from their historical norms. Using a panel data set of 174 countries over the years 1960 to 2014, we find that per-capita real output growth is adversely affected by persistent changes in the temperature above or below its historical norm, but we do not obtain any statistically significant effects for changes in precipitation. Our counterfactual analysis suggests that a persistent increase in average global temperature by 0.04C per year, in the absence of mitigation policies, reduces world real GDP per capita by 7.22 percent by 2100. On the other hand, abiding by the Paris Agreement, thereby limiting the temperature increase to 0.01C per annum, reduces the loss substantially to 1.07 percent. These effects vary significantly across countries. We also provide supplementary evidence using data on a sample of 48 U.S. states between 1963 and 2016, and show that climate change has a long-lasting adverse impact on real output in various states and economic sectors, and on labour productivity and employment.


Can Pigou at the Polls Stop Us Melting the Poles?
Soren Anderson, Ioana Marinescu & Boris Shor
NBER Working Paper, August 2019

Abstract:
Surveys show majority U.S. support for a carbon tax. Yet none has been adopted. Why? We study two failed carbon tax initiatives in Washington State in 2016 and 2018. Using a difference-in-differences approach, we show that Washington's real-world campaigns reduced support by 20 percentage points. Resistance to higher energy prices explains opposition to these policies in the average precinct, while ideology explains 90% of the variation in votes across precincts. Conservatives preferred the 2016 revenue-neutral policy, while liberals preferred the 2018 green-spending policy. Yet we forecast both initiatives would fail in other states, demonstrating that surveys are overly optimistic.


Observed impacts of anthropogenic climate change on wildfire in California
Park Williams et al.
Earth's Future, forthcoming

Abstract:
Recent fire seasons have fueled intense speculation regarding the effect of anthropogenic climate change on wildfire in western North America, and especially in California. During 1972-2018, California experienced a five‐fold increase in annual burned area, mainly due to more than an eight‐fold increase in summer forest‐fire extent. Increased summer forest‐fire area very likely occurred due to increased atmospheric aridity caused by warming. Since the early 1970s, warm‐season days warmed by approximately 1.4°C as part of a centennial warming trend, significantly increasing the atmospheric vapor pressure deficit (VPD). These trends were consistent with anthropogenic trends simulated by climate models. The response of summer forest‐fire area to VPD is exponential, meaning that warming has grown increasingly impactful. Robust interannual relationships between VPD and summer forest burned area strongly suggest that nearly all of the increase in summer forest‐fire area during 1972-2018 was driven by increased VPD. Climate‐change effects on summer wildfire were less evident in non‐forest. In fall, wind events and delayed onset of winter precipitation are the dominant promoters of wildfire. While these variables did not change much over the past century, background warming and consequent fuel drying is increasingly enhancing the potential for large fall wildfires. Among the many processes important to California's diverse fire regimes, warming‐driven fuel drying is the clearest link between anthropogenic climate change and increased California wildfire activity to date.


Highly decentralized solar geoengineering
Jesse Reynolds & Gernot Wagner
Environmental Politics, forthcoming

Abstract:
Nonstate actors appear to have increasing power, in part due to new technologies that alter actors’ capacities and incentives. Although solar geoengineering is typically conceived of as centralized and state-deployed, we explore highly decentralized solar geoengineering. Done perhaps through numerous small high-altitude balloons, it could be provided by nonstate actors such as environmentally motivated nongovernmental organizations or individuals. Conceivably tolerated or even covertly sponsored by states, highly decentralized solar geoengineering could move presumed action from the state arena to that of direct intervention by nonstate actors, which could in turn, disrupt international politics and pose novel challenges for technology and environmental policy. We conclude that this method appears technically possible, economically feasible, and potentially politically disruptive. Decentralization could, in principle, make control by states difficult, perhaps even rendering such control prohibitively costly and complex.


Can presidential misinformation on climate change be corrected? Evidence from Internet and phone experiments
Ethan Porter, Thomas Wood & Babak Bahador
Research & Politics, August 2019

Abstract:
Can presidential misinformation affect political knowledge and policy views of the mass public, even when that misinformation is followed by a fact-check? We present results from two experiments, conducted online and over the telephone, in which respondents were presented with Trump misstatements on climate change. While Trump’s misstatements on their own reduced factual accuracy, corrections prompted the average subject to become more accurate. Republicans were not as affected by a correction as their Democratic counterparts, but their factual beliefs about climate change were never more affected by Trump than by the facts. In neither experiment did corrections affect policy preferences. Debunking treatments can improve factual accuracy even among co-partisans subjected to presidential misinformation. Yet an increase in climate-related factual accuracy does not sway climate-related attitudes. Fact-checks can limit the effects of presidential misinformation, but have no impact on the president’s capacity to shape policy preferences.


Estimation of global final-stage energy-return-on-investment for fossil fuels with comparison to renewable energy sources
Paul Brockway et al.
Nature Energy, July 2019, Pages 612-621

Abstract:
Under many scenarios, fossil fuels are projected to remain the dominant energy source until at least 2050. However, harder-to-reach fossil fuels require more energy to extract and, hence, are coming at an increasing ‘energy cost’. Associated declines in fossil fuel energy-return-on-investment ratios at first appear of little concern, given that published estimates for oil, coal and gas are typically above 25:1. However, such ratios are measured at the primary energy stage and should instead be estimated at the final stage where energy enters the economy (for example, electricity and petrol). Here, we calculate global time series (1995-2011) energy-return-on-investment ratios for fossil fuels at both primary and final energy stages. We concur with common primary-stage estimates (~30:1), but find very low ratios at the final stage: around 6:1 and declining. This implies that fossil fuel energy-return-on-investment ratios may be much closer to those of renewables than previously expected and that they could decline precipitously in the near future.


Coase, Hotelling and Pigou: The Incidence of a Carbon Tax and CO2 Emissions
Geoffrey Heal & Wolfram Schlenker
NBER Working Paper, July 2019

Abstract:
A carbon tax has been widely discussed as a way of reducing fossil fuel use and mitigating climate change, generally in a static framework. Unlike standard goods that can be produced, oil is an exhaustible resource. Parts of its price reflects scarcity rents, i.e., the fact that there is limited availability. We highlight important dynamic aspects of a global carbon tax, which will reallocate consumption through time: some of the initial reduction in consumption will be offset through higher consumption later on. Only reserves with high enough extraction cost will be priced out of the market. Using data from a large proprietary database of field-level oil data, we show that carbon prices even as high as 200 dollars per ton of CO2 will only reduce cumulative emissions from oil by 4% as the supply curve is very steep for high oil prices and few reserves drop out. The supply curve flattens out for lower price, and the effect of an increased carbon tax becomes larger. For example, a carbon price of 600 dollars would reduce cumulative emissions by 60%. On the flip side, a global cap and trade system that limits global extraction by a modest amount like 4% expropriates a large fraction of scarcity rents and would imply a high permit price of $200. The tax incidence varies over time: initially, about 75% of the carbon price will be passed on to consumers, but this share declines through time and even becomes negative as oil prices will drop in future years relative to a case of no carbon tax. The net present value of producer and consumer surplus decrease by roughly equal amounts, which are almost entirely offset by increased tax revenues.


No evidence for globally coherent warm and cold periods over the preindustrial Common Era
Raphael Neukom et al.
Nature, 25 July 2019, Pages 550-554

Abstract:
Earth’s climate history is often understood by breaking it down into constituent climatic epochs. Over the Common Era (the past 2,000 years) these epochs, such as the Little Ice Age, have been characterized as having occurred at the same time across extensive spatial scales. Although the rapid global warming seen in observations over the past 150 years does show nearly global coherence, the spatiotemporal coherence of climate epochs earlier in the Common Era has yet to be robustly tested. Here we use global palaeoclimate reconstructions for the past 2,000 years, and find no evidence for preindustrial globally coherent cold and warm epochs. In particular, we find that the coldest epoch of the last millennium - the putative Little Ice Age - is most likely to have experienced the coldest temperatures during the fifteenth century in the central and eastern Pacific Ocean, during the seventeenth century in northwestern Europe and southeastern North America, and during the mid-nineteenth century over most of the remaining regions. Furthermore, the spatial coherence that does exist over the preindustrial Common Era is consistent with the spatial coherence of stochastic climatic variability. This lack of spatiotemporal coherence indicates that preindustrial forcing was not sufficient to produce globally synchronous extreme temperatures at multidecadal and centennial timescales. By contrast, we find that the warmest period of the past two millennia occurred during the twentieth century for more than 98 per cent of the globe. This provides strong evidence that anthropogenic global warming is not only unparalleled in terms of absolute temperatures, but also unprecedented in spatial consistency within the context of the past 2,000 years.


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