Lorrie Goldstein writes a review of a new Fraser Institute study by McKitrick and Murphy. The study is Off Target: The Economics Literature Does Not Support the 1.5C Climate Ceiling. Excerpts from Goldstein’s article in italics with my bolds.
Trying to achieve the United Nations’ target of limiting global temperature increases to 1.5 C above pre-industrial levels will do more social and economic harm than good, says a new study by the Fraser Institute released Tuesday.
“Although advocacy of aggressive climate-change policies is often draped with the mantel of science … the popular 1.5C policy target will pose costs that far exceed the benefits,” the study says.
“Emission reductions flowing from strict adherence to the 1.5C target would be worse for the world than doing nothing at all.”
Study authors Ross McKitrick and Robert P. Murphy argue in Off Target: The Economics Literature Does Not Support the 1.5C Climate Ceiling, that the 1.5C target “did not arise … from formal cost-benefit analysis.”
In fact, a 2018 report by the UN’s Intergovernmental Panel on Climate Change that argued there would be net societal benefits to achieving the 1.5C target — used by Canada and other countries to justify the public cost of lowering greenhouse gas emissions — “expressly stated” it did not do a cost-benefit analysis.
The 2018 UN study, Global Warming of 1.5°C — An IPCC Special Report, said because the calculations were so complex, “standard cost–benefit analyses become difficult to justify and are not used as an assessment tool in this report.”
Instead, the UN report cited a range of studies that have estimated the global cost of carbon pricing (expressed here in current Canadian dollars) to meet the UN’s target of limiting global temperature increases to 1.5C above pre-industrial levels by 2100.
They went from a low of $170 per tonne of emissions, to a high of $6,900 per tonne by 2030; $307 per tonne to $16,300 per tonne by 2050; $527 to $21,955 by 2070 and $865 to $33,873 by 2100. Given such numbers, Murphy argues in the Fraser report, “it would be better if governments did nothing at all about climate change than to try to achieve the 1.5C target because the costs so outweigh the estimated benefits.”
(Prime Minister Justin Trudeau’s current carbon price is $40 per tonne of emissions, rising to $170 per tonne in 2030.)
In the real world, no government is going to impose a carbon tax/price of up to $6,900 per tonne of emissions by 2030 — with more hikes after that — because it would be political and economic suicide.
No one knows what global temperatures are going to be in 2100, nor what the global carbon price on emissions would have to be by then to meet the UN’s target of limiting warming to 1.5C above pre-industrial levels.
What we do know for a fact today is that global emissions are steadily rising. The only exceptions in the modern era occurred in 2008-09 and 2020, when they fell dramatically not because of carbon pricing, but because of global recessions, before resuming their upward climb the following year.
We also know that as of 2021, we are so far behind the UN’s target of reducing emissions to 45% below 2010 levels by 2030, that achieving that goal would require lowering emissions globally by 7.6% annually every year between now and 2030.
And finally, we know that, since almost all goods and services consume fossil fuel energy, a 7.6% annual reduction in emissions every year from now until 2030, would provoke an unprecedented global recession in which the social and economic costs would far outweigh the benefits.