Climate Change: Show Us the Money

In an exciting burst of progress for those of us who live on … and love ... planet Earth, the Supreme Court recently deemed constitutional the federal regulation of greenhouse gas (GHG) emissions from power plants. However, as Lawrence Hurley of Reuters reports, this win may not extend far enough, as individual and smaller sources may be exempted

Some landfills, pulp and paper facilities, electronics manufacturing plants, chemical production plants and beverage producers are among the small industrial sources likely to be exempted, an EPA spokesman said.”

Nevertheless, more hopeful efforts on curbing GHG’s and climate change are in the works via a new initiative by some powerful names in economics who are attempting to frame climate change in terms of a different kind of green: money. Lead by former Secretary of Treasury Henry Paulson, the group released on Tuesday a report called Risky Business: The Economic Risks of Climate Change in your region. They are talking big money here! Summarizing some of the findings Alicia Munday of the Wall Street Journal writes:

The study concludes that within the next 15 years, higher sea levels, storm surges and hurricanes could raise the annual price tag for coastal damage along the East Coast and the Gulf of Mexico to $35 billion. Some Midwestern and Southern agricultural areas could see a decline in yields of more than 10% over the next five to 25 years due to increased drought and flooding, unless farmers adapt their crops, according to the study."

Other estimations include $66 billions to $106 billions-worth of coastal property submerged by the sea by 2050, 3% loss of productivity of outdoor workers, and electricity costs of $12 billion a year more to run air conditioners. The full report can be downloaded here.

All this is sobering, but the report also offers suggestions for market-based solutions. In an Op-ed in the NY Times, Paulson explains:

We need to craft national policy that uses market forces to provide incentives for the technological advances required to address climate change. As I’ve said, we can do this by placing a tax on carbon dioxide emissions. Many respected economists, of all ideological persuasions, support this approach. We can debate the appropriate pricing and policy design and how to use the money generated. But a price on carbon would change the behavior of both individuals and businesses. At the same time, all fossil fuel — and renewable energy — subsidies should be phased out. Renewable energy can out compete dirty fuels once pollution costs are accounted for."

Is the future of our climate in the hands of our economic system because the EPA’s reach can only extend so far? We hope that global consciousness can shift away from climate change denial and just do the right thing, but hitting peoples’ wallets may be a necessary step along the way.

HEAT MAP: Risky Business Project. Data Source: Rhodium Group

Sources:

Read all articles by Damon Cory-Watson 

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