Lomborg think tank urges cuts in climate change mitigation costs

Stringent carbon targets that aim to limit global warming to 2°C above pre-industrial temperatures are prohibitively expensive and should be abandoned in favour of a more gradual approach, according to a report published by controversial think tank the Copenhagen Consensus Center.

The study is at entirely at odds with the prevailing view that all available effort should be put into limiting greenhouse gas concentrations to 450 parts per million (ppm) CO2 equivalent over the next century, instead opting for a target of between 550 ppm and 650 ppm.

The report's author, climate economist Professor Dr. Richard Tol, said a well-designed, gradual policy of carbon cuts could substantially reduce emissions at lower cost to society than current carbon emission reduction policies.

"Ill-designed policies, or policies that seek to do too much too soon can be orders of magnitude more expensive," he said. "While the academic literature has focused on the former, policy makers have opted for the latter."

Tol added that if the world stabilised concentrations of CO2 at 450ppm - the level widelty regarded as necessary to limit temperature rises to two degree - then the welfare loss induced by climate change in the year 2100 would be in the same order as losing a few per cent of income. But he argued that attaining this would require carbon to be priced at $68 per tonne, costing the global economy $50 for every dollar saved.

Implementing a lower carbon price of $0.50 per ton would bring about a return of $1.51 in avoided climate damage for every $1 spent, the report said, stablising greenhouse has levels at around 850 ppm. However, climate scientists predict that at such high levels of greenhouse gas concentration temperature increases would top six degrees, making vast swathes of the world unihabitable and leading to the collapse of the global economy.

Tol's report also analyses three intermediary options, which similarly provide increasingly better value for money albeit at greater damage to the climate.

Copenhagen Consensus, publishers of the report, are a group brought together by controversial Danish academic Bjorn Lomborg, who came to prominence with his book The Sceptical Environmentalist and has long argued that funds earmarked for tackling climate change would be better spent addressing other development issues.

Lomborg has shifted his stance somewhat and now accepts global warming is a problem, but has continued to anger green groups by arguing recently that geo-engineering technologies offer a more cost effective solution than carbon abatement strategies.

Speaking to BusinessGreen.com, Dimitri Zenghelis, a former senior economist with the team that worked on the Stern Review, took issue with Tol's conclusions. "He tends to pack the odds in strong favour of not tackling climate change," he said. "He assumes the costs of action are extraordinarily high and if you reconnect with the science the results of the scenarios he is proposing would be catastrophic."

He added that the wider economic costs that would arise with the kind of four degree plus temperature rises Tol's report assesses had been hugely underestimated. "Remember it is the developing world who will suffer most from climate change and the costs of rectifying that suffering will be huge as well, " he observed.

Zenghelis said that there is a legitimate argument for more resources to be devoted towards climate change adaptation but not at the cost of mitigation.

Angela Anderson, program director of the US Climate Action Network, told Bloomberg that she also disagreed with the study's findings. "If you're a world leader and want to protect your citizens, position your country for future growth and security, prudence requires that you do what science tells you," she said. "That means focusing on cutting emissions."