Metrics for Aggregating the Climate Effect of Different Emissions: A Unifying Framework. ESRI WP257, September 2008

Tol, Richard S.J. and Berntsen, Terje K. and O'Neill, Brian C. and Fuglestvedt, Jan S. and Shine, Keith P. and Balkanski, Yves and Makra, Laszlo (2008) Metrics for Aggregating the Climate Effect of Different Emissions: A Unifying Framework. ESRI WP257, September 2008. [Working Paper]

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Abstract

Multi-gas approaches to climate change policies require a metric establishing “equivalences” among emissions of various species. Climate scientists and economists have proposed four classes of such metrics and debated their relative merits. We present a unifying framework that clarifies the relationships among them. We show that the Global Warming Potential, used in international law to compare greenhouse gases, is a special case of the Global Damage Potential, assuming (1) a finite time horizon, (2) a zero discount rate, (3) constant atmospheric concentrations, and (4) impacts that are proportional to radiactive forcing. We show that the Global Temperature change Potential is a special case of the Global Cost Potential, assuming (1) no induced technological change, and (2) a short-lived capital stock. We also show that the Global Cost Potential is a special case of the Global Damage Potential, assuming (1) zero damages below a threshold and (2) infinite damage after a threshold. The UN Framework Convention on Climate Change uses the Global Warming Potential, a simplified cost-benefit concept, even though the UNFCCC frames climate policy as a cost-effectiveness problem and should therefore use the Global Cost Potential or its simplification, the Global Temperature Potential.

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