Kevin Trenberth, Distinguished Scholar, NCAR;
Tue, August 9, 2022
This direct air capture plant in Iceland was designed to capture 4,000 metric tons of carbon dioxide per year. Climeworks 2021 via AP Photos
When politicians talk about reaching “net zero” emissions, they’re often counting on trees or technology that can pull carbon dioxide out of the air. What they don’t mention is just how much these proposals or geoengineering would cost to allow the world to continue burning fossil fuels.
There are many proposals for removing carbon dioxide, but most make differences only at the edges, and carbon dioxide concentrations in the atmosphere have continued to increase relentlessly, even through the pandemic.
I’ve been working on climate change for over four decades. Let’s take a minute to come to grips with some of the rhetoric around climate change and clear the air, so to speak.
What’s causing climate change?
As has been well established now for several decades, the global climate is changing, and that change is caused by human activities.
When fossil fuels are burned for energy or used in transportation, they release carbon dioxide – a greenhouse gas that is the main cause of global heating. Carbon dioxide stays in the atmosphere for centuries. As more carbon dioxide is added, its increasing concentration acts like a blanket, trapping energy near Earth’s surface that would otherwise escape into space.
When the amount of energy arriving from the Sun exceeds the amount of energy radiating back into space, the climate heats up. Some of that energy increases temperatures, and some increases evaporation and fuels storms and rains.
How the greenhouse effect works. EPA
Because of these changes in atmospheric composition, the planet has warmed by an estimated 1.1 degrees Celsius (2 F) since about 1880 and is well on the way to 1.5 C (2.7 F), which was highlighted as a goal not to be crossed if possible by the Paris Agreement. With the global heating and gradual increases in temperature have come increases in all kinds of weather and climate extremes, from flooding to drought and heat waves, that cause huge damage, disruption and loss of life.
Studies shows that global carbon dioxide emissions will need to reach net-zero carbon emissions by midcentury to have a chance of limiting warming to even 2 C (3.6 F).
Currently, the main source of carbon dioxide is China. But accumulated emissions matter most, and the United States leads, closely followed by Europe, China and others.
Estimated shares of carbon dioxide emissions from fossil fuels in 2018 compared with cumulative emissions over time, based on data released by BP. Kevin Trenberth, Author provided
What works to slow climate change?
Modern society needs energy, but it does not have to be from fossil fuels.
Studies show that the most effective way to address the climate change problem is to decarbonize the economies of the world’s nations. This means sharply increasing use of renewable energy – solar and wind cost less than new fossil fuel plants in much of the world today – and the use of electric vehicles.
Unfortunately, this changeover to renewables has been slow, due in large part to the the huge and expensive infrastructure related to fossil fuels, along with the vast amount of dollars that can buy influence with politicians.
What doesn’t work?
Instead of drastically cutting emissions, companies and politicians have grasped at alternatives. These include geoengineering; carbon capture and storage, including “direct air capture”; and planting trees.
Here’s the issue:
Geoengineering often means “solar radiation management,” which aims to emulate a volcano and add particulates to the stratosphere to reflect incoming solar radiation back to space and produce a cooling. It might partially work, but it could have concerning side effects.
The global warming problem is not sunshine, but rather that infrared radiation emitted from Earth is being trapped by greenhouse gases. Between the incoming solar and outgoing radiation is the whole weather and climate system and the hydrological cycle. Sudden changes in these particles or poor distribution could have dramatic effects.
Some methods of solar radiation management that have been proposed.
The last major volcanic eruption, of Mt. Pinatubo in 1991, sent enough sulfur dioxide and particulates into the stratosphere that it produced modest cooling, but it also caused a loss of precipitation over land. It cooled the land more than the ocean so that monsoon rains moved offshore, and longer term it slowed the water cycle.
Carbon capture and storage has been researched and tried for well over a decade but has sizable costs. Only about a dozen industrial plants in the U.S. currently capture their carbon emissions, and most of it is used to enhance drilling for oil.
Direct air capture – technology that can pull carbon dioxide out of the air – is being developed in several places. It uses a lot of energy, though, and while that could potentially be dealt with by using renewable energy, it’s still energy intensive.
Boris Johnson, then mayor of London, plants a tree in 2008.
Planting trees is often embraced as a solution for offsetting corporate greenhouse gas emissions. Trees and vegetation take up carbon dioxide though photosynthesis and produce wood and other plant material. It’s relatively cheap.
But trees aren’t permanent. Leaves, twigs and dead trees decay. Forests burn. Recent studies show that the risks to trees from stress, wildfires, drought and insects as temperatures rise will also be larger than expected.
How much does all this cost?
Scientists have been measuring carbon dioxide at Mauna Loa, Hawaii, since 1958 and elsewhere. The average annual increase in carbon dioxide concentration has accelerated, from about 1 part per million by volume per year in the 1960s to 1.5 in the 1990s, to 2.5 in recent years since 2010.
This relentless increase, through the pandemic and in spite of efforts in many countries to cut emissions, shows how enormous the problem is.
Carbon dioxide concentrations at Mauna Loa, Hawaii. The monthly mean, in red, rises and falls with the growing seasons. The black line is adjusted for the average seasonal cycle. Kevin Trenberth, based on NOAA data, CC BY-ND
Usually carbon removal is discussed in terms of mass, measured in megatons – millions of metric tons – of carbon dioxide per year, not in parts per million of volume. The mass of the atmosphere is about 5.5x10¹⁵ metric tons, but as carbon dioxide (molecular weight 42) is heavier than air (molecular weight about 29), 1 part per million by volume of carbon dioxide is about 7.8 billion metric tons.
According to the World Resources Institute, the range of costs for direct air capture vary between US0 and 0 per metric ton of carbon dioxide removed today, depending on the technology, energy source and scale of deployment. Even if costs fell to 0 per metric ton, the cost of reducing the atmospheric concentrations of carbon dioxide by 1 part per million is around 0 billion.
Keep in mind that the carbon dioxide concentration in the atmosphere has risen from about 280 parts per million before the industrial era to around 420 today, and it is currently rising at more than 2 parts per million per year.
Tree restoration on one-third to two-thirds of suitable acres is estimated to be able to remove about 7.4 gigatons of carbon dioxide by 2050 without displacing agricultural land, by WRI’s calculations. That would be more than any other pathway. This might sound like a lot, but 7 gigatons of carbon dioxide is 7 billion metric tons, and so this is less than 1 part per million by volume. The cost is estimated to be up to per metric ton. So even with trees, the cost to remove 1 part per million by volume could be as much as 0 billion.
Geoengineering is also expensive.
So for hundreds of billions of dollars, the best prospect with these strategies is a tiny dent of 1 part per million by volume in the carbon dioxide concentration.
This arithmetic highlights the tremendous need to cut emissions. There is no viable workaround.
This article is republished from The Conversation, a nonprofit news site dedicated to sharing ideas from academic experts. It was written by: Kevin Trenberth, University of Auckland.
Read more:
Trees aren’t a climate change cure-all – 2 new studies on the life and death of trees in a warming world show why
Why the oil industry’s pivot to carbon capture and storage – while it keeps on drilling – isn’t a climate change solution
Climate change is relentless: Seemingly small shifts have big consequences
For years, economists championed carbon pricing as the most economically efficient way to transition the energy sector to net zero — but that may no longer be the case.
According to a new NBER working paper, carbon pricing policies such as carbon taxes and cap-and-trade programs may not be better than other options.
Using 2019 data to model the U.S. electricity grid, researchers found that energy intensity standards and clean energy subsidies may be just as efficient as carbon pricing policies.
“I think the first thing it should do is end the mantra among some environmental economists that carbon taxes are the best mechanism or the even more extreme view, which is carbon taxes will solve the problem entirely,” Severin Borenstein, one of the paper’s co-authors and a professor at UC Berkeley’s Haas School of Business, told Yahoo Finance. “I think that neither of those is true. And so we need to take a more nuanced look.”
Putting a price on carbon emissions, setting clean electricity standards, and subsidizing clean energy are all ways the market can nudge power producers toward generating electricity from clean sources like wind, solar, and hydropower while eliminating emissions that come from burning fossil fuels.
Experts say there is a narrow window of opportunity to act to limit "irreversible" shifts in the climate, which are already costing global economies billions and harming human health.
In the U.S., electricity generation accounts for at least a quarter of emissions, with 60% of electricity coming from fossil fuel sources like coal and natural gas. Borenstein emphasized that this paper specifically addresses the electricity sector, and that the model doesn't apply to other sectors like transportation.
“I think the real question is: If the goal was to get to the clean electricity grid and then use clean electricity to decarbonize other sectors of the economy... a nice virtue of a subsidy-driven route to decarbonizing the grid is that it actually results in low electricity prices for consumers," Ryan Kellogg, the paper's co-author and professor at the University of Chicago Harris School of Public Policy, told Yahoo Finance.
'The cost of natural gas plays a big role'
If climate change is the result of a market failure, as some experts argue, then carbon pricing aims to correct that failure.
Carbon pricing policies tend to fall into two categories: a carbon tax which puts price on each ton of greenhouse gas emissions, or a cap-and-trade program that sells emissions permits and allows businesses to trade among themselves.
By making pollution more expensive for operators, carbon pricing is seen as a particularly compelling tool because it targets the biggest polluters first — namely, coal plants.
That may also be true of other policy options like clean electricity standards and subsidies, the researchers argued, due to a correlation between emissions and operating costs. They found that overall emissions throughout an energy transition are just 2.2% higher under a clean energy standard policy than under a carbon tax.
“One of the things that we found — and this was actually a little bit surprising to us just how stark the result — was that plants that have very high emissions rates — coal plants — also tended to have much higher ongoing operating costs than combined cycle gas turbines,” Kellogg said.
This "happy coincidence," as Kellogg put it, means that when gas prices are relatively low, private operators would be incentivized to shut down coal plants first anyway because they're more costly to run.
However, "the cost of natural gas plays a big role," Borenstein said. "Because if natural gas is expensive, then a clean energy standard will have companies shutting down natural gas plants while still running coal plants. So then the correlation between the pollution and the private cost falls apart."
Though high natural gas prices have been a key theme in 2022, due to the Russian invasion of Ukraine and pandemic recovery, they're unlikely to stay that way, Borenstein argued. In particular, as decarbonization gains a stronger foothold, it will in all probability drive gas prices down over time.
"The futures market is predicting prices will be down in the $4 range within a few years," he said. "And if we really start to decarbonize rapidly, I think they'll be a lot lower than that because there will be very low demand for natural gas. So I think that if we're going to talk about a scenario going to zero or near zero emissions, that scenario will almost certainly be accompanied by cheap natural gas."
The markup on electricity prices
There is a second argument in favor of carbon pricing, which is that it shapes behavior and encourages the biggest power consumers to reduce their energy usage — thereby driving down carbon emissions.
The paper suggested this particular argument may also be flawed because many consumers already pay marked-up electricity prices — a trend which will likely increase throughout the energy transition.
The amount of energy a household consumes makes up just one portion of what they pay the utility. Electricity bills also incorporate the utility's procurement costs and fixed costs for building infrastructure like transmission lines. Utilities charge consumers for these other costs per kilowatt hour rather than as a fixed fee.
As a result, in many areas of the country, the prices consumers are paying already exceed the social cost of electricity generation. Carbon pricing would likely add on to price increases without necessarily sending an accurate price signal to consumers.
"What I pay to consume electricity is already quite a bit more than the cost of that what it actually costs to generate that electricity," Kellogg said. “So that function of carbon pricing of increasing prices isn’t one that we actually need.”
Borenstein explained that the effect is more pronounced in states that have already put decarbonization policies in place. In California, for instance, the cost of electricity is much higher than the social cost of burning fossil fuels. In the Upper Midwest, prices tend to fall below that cost due to higher rates of burning coal.
The model found that during the energy transition, a carbon pricing scenario would result in the highest wholesale energy prices while clean energy subsidies would result in the lowest prices.
"In fact, if anything, we'd like electricity to cost less in order to encourage electrification and substitution away from other fossil fuels," Borenstein noted.
Distributing green transition costs
As state and federal governments move to accelerate the energy transition, the question of who pays is becoming more salient.
These policy tools vary in how they distribute those costs across consumers, private enterprises, and governments, and they all have tradeoffs that policymakers will need to carefully consider.
“One way to maybe put a really fine point on it," Kellogg said, "is if you want to have a green transition, there's a question of: Do we want to pay for that green transition through retail electricity prices, which is what carbon pricing would do, ... or do we want to pay for that green transition through the public budget, which is what the clean energy subsidy would do?”
The authors stressed that these findings don't mean that carbon pricing is a less efficient tool but that other tools like subsidies and clean energy standards might be more economically efficient options than previously thought.
Carbon taxes have other added benefits. For instance, they are the only policy tool that brings in revenue, which governments can use to fund other clean energy projects, tax credits, or send rebates to households to offset higher electricity prices, as Canada has done.
“Economic efficiency is not the only standard, but economic efficiency is pretty important," Borenstein stated. "Economic efficiency is the size of the pie. And if you do something inefficient, you are making the pie smaller."
Grace is an assistant editor for Yahoo Finance.
