Category Archives: Climate Change

Chart du Jour, 1 April 2015: Were the 1950s So Good?

Sometimes it is best just to pilfer other people’s work– any other action feels rather pointless. This from Andy Skuce’s blog Critical Angle (click for larger image):

CO2 Sources copy

Bang! Marty McFly goes back to 1955 to persuade Doc to save the world from fossil fuel emissions (one can but dream).

Then again can we ask ourselves whether the relatively low energy intensity economies of the 1950s had a higher level of well-being than those that exist now (of course development has widened and population has grown). I’ll let my readers have a think about that.

Anyway, check out the Critical Angle blog here.

Wantability, Well-Being and Risk

I’ve been mulling a name change for the blog for some time. The name the “The Rational Pessimist” was a riposte to Matt Ridley’s book “The Rational Optimist“. Ridley’s book is a paean to global free markets and human innovation–and in parts is correct. Since the industrial revolution commenced, technology coupled with capitalism has lifted the bulk of the world’s population out of a Hobbesian life that was “nasty, brutish and short”. But where I differ from Ridley is in believing that a 200-year data set of economic growth can fully capture all future risk.

Ridley’s book is Panglossian. He believes that every problem we face–from climate change to resource depletion–is relatively minor, just waiting to be solved by a technological fix. For him, price always trumps scarcity. Whenever something looks like it is running out, the magic of markets will  always lead to new discoveries or acceptable substitutes.

As an economist by training, I accept that the everlasting dance between supply, demand and price is something of beauty. But I also believe that it has its limitations. A backward-looking empirical observation that things haven’t run out is different from a forward-looking theoretical prediction that things won’t ever run out. North Sea oil is running out regardless of price, and a global supply of oil is not qualitatively different from a local one.

Of course, technology may provide a perfect, or dare I say it better, substitute for fossil fuels. But then again it may not. That is uncertainty, and the consequences of that uncertainty is the concept of risk.

Continue reading

Charts du Jour, 16 March 2015: The Direct Impact of Natural Disasters

If you have a taste for doomer porn, then Desdemona Despair is the ‘go to’ site for you. Looking at the succession of despoiled ecosystems and ravished environments, it is hard not to get depressed. Nonetheless, while our natural assets are being fed through the meat grinder, the numbers show that our bodies are yet to meet a similar fate.

In a fascinating study led by Ilan Noy, a new index is proposed that “converts all damage indicators, including mortality, morbidity, and other impacts on human lives (e.g. displacement) – as well as damage to infrastructure and housing – into an aggregate measure of human lifeyears lost.”

In their approach, they “calculate the total years lost as the sum of years lost due to death, injury/affected, and financial damage.”

Adopting this methodology, the following chart is produced (click for larger image):

Total Life Years Lost by Regions jpeg

Critically, the impact of climate change, or environmental destruction in general, is yet to be seen.

We find no trend in the calculated index, and additionally we observe that most of disaster impacts are experienced in Asia (East and South). This dominance is likely due both to the region’s high degree of exposure to a multitude of extreme events (especially wide-scale flooding) and to the high population density in exposed areas (the coasts along the Pacific and Indian Oceans and the major river systems).

Before I am accused of sounding too much like my doppelgänger The Rational Optimist, I should emphasise that this is a human-centric metric. Species extinction doesn’t show up. Just as important, the system may tip. At present, the United States can absorb a Hurricane Katrina with ease (not withstanding the devastation such an event causes at a personal level). But what happens when you throw two or three Katrinas at the system in quick succession.

Even worse, what happens when extreme weather events graduate from being acute events to those that are chronic. An economy is composed of flows (GDP) and stocks (wealth). Some wealth destruction actually stimulates GDP. But when wealth destruction become a quotidian event, flow (GDP) won’t be able to cope. We are not at such a state of affairs as yet. I am not confident that we never will reach such a state.


Charts du Jour, 13 March 2015: Two Cheers for Emissions Slowdown

The International Energy Agency (IEA) announced today that CO2 emissions in 2014 were flat year on year at 32.3 billion tonnes. This is undoubtedly good news–particularly if it marks the start of a trend.

The chart below is from an article from the FT here (free registration for access). Note, the three previous occasions when emissions flatlined or fell were all associated with recessions or economic crises (click for larger image).

Global GDP and Emissions jpeg

The IEA also points out that global GDP growth in 2014 was around 3%, so the better emission performance was the result of lower GDP-to-energy intensity and reduced energy-to-carbon emissions intensity (the so called Kaya Identify, which maps GDP to emissions, can be found in my post here). Continue reading

Charts du Jour, 11 March 2015: EU Emissions and Renewable Targets

The ‘Chart of the Day’ tag was supposed to be accompanied by one chart and a short accompanying commentary. In reality, I have hardly ever managed to restrict myself to one chart. Oh well, such is life. Facing up to this reality, I will rename these posts ‘Charts du Jour’, starting off with the EU’s emissions and renewable targets.

I’ve been meaning to blog about the renewable road maps of various European countries for a long time. This is a big topic and draws a lot of uninformed comment in the media. For example, is Germany’s ‘Energiewende’ a disaster or a roaring success? Pick up a few newspapers and you see this question argued passionately both ways.

But to start with, let’s set the scene by focussing on the European Union level legislation that sits above all national policies. The centre piece of this is European Council‘s commitment to reduce greenhouse gas emissions by 80-95% by 2050 compared to 1990. This was reconfirmed in February 2011 as Europe’s contribution to keeping climate change below 2 degrees Celsius as agreed upon at the 2009 Copenhagen climate talks.

To meet this commitment, the European Commission has draw up “a roadmap for moving to a competitive low carbon economy by 2050”. You can find the document here. And within this document is this chart (click for larger image):

EU GHG Emission Reductions jpeg

The EU has also passed legislation establishing climate and energy targets for 2020. These are known as the “20-20-20” targets and are as follows: Continue reading

Chart of the Day, 10 March 2015: The Stability of Carbon Sinks and Sources

About time we revisited the Big Number which sits on the right side of my blog: the atmospheric concentration of CO2. I dub this “the most important risk indicator in the world” since it will have a greater impact on humanity than anything else I can think of (barring the earth getting hit by a stray astroid or such).

The monthly average is back over 400 parts per million (ppm) as of February. As a reminder, the cyclicality is a result of the northern hemisphere (which accounts for 65% of global land mass) plant growth and decay cycle. Source for the two charts below: NOAA (click for larger images).

Recently Monthly Mean CO2 jpeg

The annual average year-on-year continues to grind up despite the fact that the first United Nations Climate Conference of Parties (COP) took place back in 1995.

Annual Mean Growth Rate of CO2 jpeg

COP 21 will take place in Paris this December, yet the above chart demonstrates that little progress has been made in mitigating carbon emissions.

In a blog post I wrote three years ago called “A Fraction for Your Thoughts” I highlighted a hidden risk contained in the above chart: the stability of the carbon sink and source relationship. As you can see from the chart below taken from the Global Carbon Budget 2014 (click for larger image), only a portion of emissions remain in the atmosphere. Continue reading

How Well Does the Climate Change Performance Index Perform?

In previous posts (here and here), I was rather rude about the World Economic Forum (WEF)‘s Global Competitiveness Index (GCI). To me, the method of compilation of the index appears dishonest. Most people understand ‘competitiveness’ to relate to some kind of competition. Yet the WEF defines competitiveness to mean prosperity, measured by GDP head. The word ‘competitiveness’ is used as just a hook.

Further, no evidence is given to suggest that maximising one’s GCI scores would later lead to higher prosperity. In short, we are implicitly encouraged to pursue WEF‘s political goals (basically neoliberalism), with the completely unsubstantiated promise that they will make us prosper.

This criticism notwithstanding, economic indexes have their uses if they are transparent and honest. The big daddy of them all is the United Nations Development Programme‘s Human Development Index (HDI). Now 25 years old, HDI was introduced to counter the shortcomings of GDP. Simplistically, a developing country may have a relatively high GDP per capita number (due perhaps to some large resource endowment like oil) but a low level of development. As the chart below shows, human development encompasses diverse dimensions that go beyond a decent standard of living (click for larger image).

Human Development Dimensions jpeg

The strength of the HDI itself is its simplicity. It is an equally weighted composite of only three factors: life expectancy, education (with two sub components of adult literacy and school enrolment) and GDP per capita. Nonetheless, it serves its purpose: to advertise to the world that politicians need to look at the capabilities of their populations, not just the level of wealth. Continue reading

Marching Rather than Blogging

Too tired to blog anything extended today after attending an action-against-climate-change rally down in London.

Glorious day for a march, and hopefully I will join the larger demonstration in Paris this December (to coincide with the COP 21 international climate talks).

For those who view this type of action as pointless, read my blog post here for one kind of response. A more considered treatise on the real value of any kind of direct action would require its own post. Another thing to add to my ‘to do’ list.

Below is our trusty band of marchers from Henley in Transition during the pre-march gathering stage and then after the march at the Houses of Parliament.



Houses of Parliament

Chart of the Day, 6 March 2015: Global Food Prices and Production

Yesterday, I highlighted the tail risk of climate change; that is, low probability but high impact outcomes that could devastate the planet.

Nonetheless, while climate change is already showing up as biodiversity stress, it is not yet appearing as an aggregated agricultural impact across the globe. True, we can produce regional examples of likely climate change-induced distress. For example, climate change probably (but not certainly) helped tip the odds toward the strong western United States drought that we have been witnessing. This, in turn, has affected certain types of crop. But climate change has yet to have a material impact on global food production in its entirety.

Below is the composite Food Price Index from the Food and Agriculture Organisation (FAO). Data source here (click for larger image).

FAO Food Price Index jpeg

Real inflation-adjusted food prices are currently not far off their 1960s/70s levels. True, they are up about 40% from 20 years of so ago, but the world has got a lot richer since then. Indeed, Chinese real GDP per capita has more than doubled over the last 10 years and India’s same statistic is up about 60%. Continue reading

Marching Against a Tail (and All Those Who Don’t Get Risk)

This Saturday 7th March, I will be joining the Time to Act Climate March, which seeks greater government action to prevent climate change. Why? Because of RISK! To remind everyone: Risk jpeg Something can be risky even if it has a low probability as long as the impact is high. Imagine a game of Russian roulette. You put a revolver against your head with one loaded chamber–and then you pull the trigger. Feeling lucky? I now offer you $1 million to play the game once. Remember, an ordinary revolver usually has six chambers, one of which is loaded. Do you take the bet? What about a pistol with 100 chambers? A thousand? With 1,000 chambers, the probability that you blow your brains out is 0.1%. Is that a good bet?

In statistics, that 0.1% likelihood outcome is firmly in the ‘tail’ of the probability distribution. When outcomes cluster around a central estimate, they may not have significant tails; others, have long or fat tails. This is important since generally the tail is where bad stuff happens. In my example above, something really horrible happens in the tail: death. As impacts go, that is pretty bad. So despite the low probability of an adverse outcome and the $1 million potential pay off, putting a 1,000 chamber pistol against your head with only one bullet is still a very risky bet.

So is frying the planet.

And this is why I think scientists like Judith Curry and Nic Lewis don’t really get risk. They argue that doubling atmospheric CO2 isn’t much to worry about because we may only warm a little. Yes, we may warm only a little; but then again we may not. Here is the climate sensitivity table from a recent paper by the two (click for larger image):

Curry and Lewis jpeg

ECS refers to equilibrium climate sensitivity and TCS to transient climate sensitivity. Simplistically, the former has a longer time horizon than the latter.

On the back of this paper, Curry was welcomed with open arms by the Wall Street Journal to do an op-ed (which you can find on Curry’s personal web site here) and feted by climate skeptic blogs across the world. In the op-ed, Curry takes an extract from the table:

Nicholas Lewis and I have just published a study in Climate Dynamics that shows the best estimate for transient climate response is 1.33 degrees Celsius with a likely range of 1.05-1.80 degrees Celsius. Using an observation-based energy-balance approach, our calculations used the same data for the effects on the Earth’s energy balance of changes in greenhouse gases, aerosols and other drivers of climate change given by the IPCC’s latest report.

And then goes on to make a policy recommendation:

This slower rate of warming—relative to climate model projections—means there is less urgency to phase out greenhouse gas emissions now, and more time to find ways to decarbonize the economy affordably. It also allows us the flexibility to revise our policies as further information becomes available.

Now ‘likely’ used in the WSJ op-ed means the 17-83% range. She has 17% of the outcomes in the good tail–warming below 1.05 degrees Celsius–and 17% in the bad tail–above 1.80 degrees Celsius. But from the table we also see that there for a 5-95% range, the outcome of a doubling of CO2 may be above 2 degrees Celsius of warming–2.5 degrees to be exact.

Some rough back of the envelope calculations. The pre-industrial revolution level of atmospheric CO2 was 280 parts per million (ppm). We are now at 400 ppm, so to double from pre-industrial concentrations, we would need to get to 560ppm. Co2 concentrations are also rising at around 2.25-2.50 ppm per annum. So if climate sensitivity to a doubling of CO2 were 3 degrees Celsius, we would get 2 degrees of global warming if CO2 concentrations reached around 450 ppm, which will be in about 20-30 years time. Two degrees of warming is considered (somewhat arbitrarily) to be the borderline for dangerous climate change.

Now Curry and Lewis see a non-negligible risk, that is 5%, that the sensitivity is 2.5 degrees. If right, the current rate of CO2 emissions would lock us into a 2-degree warmer world maybe 10 years later than the consensus, say in 2050. And then we come to the tail.

What is going on further into the tail. I want to know about this low-probability tail risk. It is important. This is the chamber containing the one bullet. If you wouldn’t play Russian roulette at very low odds, how about permanently damaging the planet at such odds?

How deeply do we have to get into the tail before we hit catastrophic climate change of 4 to 6 degrees of warming (remember that this particular risk is a composite of how much carbon we put in the atmosphere and how sensitive climate is to that amount of carbon). Let’s suppose we have a 99% confidence interval that we remain outside of the disastrous outcomes. Now we have 0.5% in the really bad upper tail. That’s odds of one in 200. Are you happy ignoring a disaster movie outcome if it only has odds of one in 200?

Moreover, if we ignore this tail risk of climate sensitivity and feel “there is less urgency to phase out greenhouse gas emissions now”,  isn’t there the possibility that due to fossil fuel infrastructure lock-in, we commit ourselves to a more than doubling of atmospheric CO2?

It gets worse. What if their climate sensitivity numbers are wrong. Curry and Lewis use one particular approach to reach their figures, but there are others. Michael Mann sets out the alternative approaches and the resulting climate sensitivity numbers in a Scientific American article here (click for larger image). In general, they are nearly all higher than those of Curry and Lewis. So Curry and Lewis’ disastrous climate change tail risk, with odds perhaps measured in the hundreds, may actually be a tail risk with odds measured in the tens. We can’t really be sure at this stage.

Solid Line of Evidence jpeg

Finally, going on a march would appear a quixotic act in the face of the wicked problem of climate change. But one can take a risk approach similar to that of extremely unlikely, but very harmful, events here as well. Voting, demonstrating and lobbying may have only a very small chance of changing the probability of the final outcome. But the potential impact of altering an outcome–through in this case encouraging more aggressive Co2 emission mitigation–is monumental. This is reverse Russian roulette, where the chamber with the bullet becomes the benign outcome. And so I march.