May 23, 2018

Meeting Paris climate goals could save the world trillions of dollars

Landscape on the Greenland Ice Sheet near Kangerlussuaq. Photo: Martin Zwick/Reda&Co/UIG via Getty Images

Meeting the more stringent global temperature targets included in the Paris climate agreement would save countries trillions of dollars in economic output, outweighing the costs of reducing emissions, new research has found.

Why it matters: The study, published Wednesday in the journal Nature, is the first to look at how global economic output would be affected under different amounts of global warming, providing policymakers with the "benefits" side of a cost-benefit analysis.

  • The study examines the historical tie between climate and economic output in 165 countries during the period from 1960 to 2010, and uses this to project future changes in economic development.

What they found: The study found that the more that the climate warms due to increasing amounts of greenhouse gases in the air, then the more that economic output in many countries would drop. Even some of the world's biggest economies — China, the U.S., and Japan — would be significantly affected if global average temperatures were to increase by two, three, or four degrees Celsius relative to preindustrial levels.

  • However, poorer countries located in the tropics would see the greatest economic losses if the world were to warm past the targets contained in the Paris agreement, which went into effect in 2016.
  • The study found that many countries in the tropics would see per capita economic output that would be 10% to 20% higher at 1.5 degrees Celsius (2.7 degrees Fahrenheit) of warming than 2 degrees Celsius (3.6 degrees Fahrenheit) of warming through 2100.
  • Only a few countries might benefit from slightly greater amounts of warming, including Scandinavian nations along with Russia, Iceland, and Canada.

The bottom line: According to study co-author Marshall Burke, by the end of the century, the world would be about 3% wealthier if global warming were limited to the Paris agreement's more stringent temperature target of 1.5 degrees Celsius, as compared to 2 degrees.

"In dollar terms this represents about $30 trillion dollars in cumulative benefits if we meet the more ambitious 1.5 degree target ... Our analysis would suggest that the benefits of meeting the stringent targets vastly outweigh the costs,”
— Marshall Burke, economist at Stanford University, on a conference call with reporters
  • The study also looked at the consequences of hitting 3 degrees Celsius (5.4 degrees Fahrenheit) of global warming, which is where the world is currently headed based on greenhouse gas emissions trends. “This will cost the globe an additional 5% to 10% of global GDP," Burke said. "Dollar-wise, that’s tens of trillions of dollars, so these are very large numbers.”
  • According to University of California at Berkeley researcher Solomon Hsiang, who was not involved in the new study, the new data provides an important new perspective. "It will cost substantial resources to transform the global energy system to be independent of fossil fuels. The analysis by Marshall and his team helps us understand whether the extra investments necessary to achieve a 1.5-degree goal are worth it," Hsiang told Axios.

Yes, but: There are considerable uncertainties associated with this study's projections. For example, a technological breakthrough could come along that would change the way society has historically responded to increasing temperatures.

  • “We cannot rule out unprecedented adaptation in the future. That is one of the inherent uncertainties in our paper,” Burke said.
  • On the other hand, Stanford climate scientist and study co-author Noah Diffenbaugh said the climate system could respond to higher levels of warming in unpredictable ways that cause even more damage, such as through the sudden, more rapid melting of ice sheets, which would trigger a sudden and damaging rise in sea levels. Climate scientists have long warned that the likelihood of such nasty surprises goes up along with global average temperatures.

Go deeper

Centrist Democrats beseech 2020 candidates: "Stand up to Bernie" or Trump wins

Bernie Sanders rallies in Las Vegas, Nevada on Feb. 21. Photo: Mario Tama/Getty Images

Center-left think tank Third Way urgently called on the Democratic front-runners of the 2020 presidential election to challenge Sen. Bernie Sanders on the South Carolina debate stage on Feb. 25, in a memo provided to Axios' Mike Allen on Saturday.

What they're saying: "At the Las Vegas debate ... you declined to really challenge Senator Sanders. If you repeat this strategy at the South Carolina debate this week, you could hand the nomination to Sanders, likely dooming the Democratic Party — and the nation — to Trump and sweeping down-ballot Republican victories in November."

Situational awareness

Warren Buffett. Photo: Daniel Zuchnik/WireImage

Catch up on today's biggest news:

  1. Warren Buffett releases annual letter, reassures investors about future of Berkshire Hathaway
  2. Greyhound bars immigration sweeps
  3. U.S. military officially stops offensive operations in Afghanistan
  4. America's future looks a lot like Nevada
  5. Centrist Democrats beseech 2020 candidates: "Stand up to Bernie" or Trump wins

America's future looks a lot like Nevada

Illustration: Sarah Grillo/Axios

Today's Nevada caucus will foreshadow the future of American politics well beyond 2020.

Why it matters: The U.S. is in the midst of a demographic transformation, and the country's future looks a lot like Nevada's present. Today's results, in addition to shaping the 2020 race, will help tell us where politics is headed in a rapidly changing country.