Climate Policy

The Covid-19 pandemic could be a dry run for future impacts of climate change, with challenging and unprecedented situations requiring rapid and aggressive responses worldwide. A proactive approach to climate change aimed at minimizing such impacts will inevitably involve significant cuts in greenhouse gas (GHG) emissions and investment in more resilient infrastructure. Although current global mitigation and adaptation efforts are proceeding slowly, one emerging strategy could serve as an accelerant: the financial disclosure of climate risk by companies.

Can financial disclosure of climate risk accelerate climate action?
The economics of bioenergy with carbon capture and storage (BECCS) deployment in a 1.5°C or 2°C world

Abstract: Bioenergy with carbon capture and storage (BECCS) and afforestation are key negative emission technologies suggested in many studies under 2°C or 1.5°C scenarios. However, these large-scale land-based approaches have raised concerns about their economic impacts, particularly their impact on food prices, as well as their environmental impacts. Here we focus on quantifying the potential scale of BECCS and its impact on the economy, taking into account technology and economic considerations, but excluding sustainability and political aspects. To do so, we represent all major components of BECCS technology in the MIT Economic Projection and Policy Analysis model.

We find that BECCS could make a substantial contribution to emissions reductions in the second half of the century under 1.5 and 2°C climate stabilization goals, with its deployment driven by revenues from carbon dioxide permits. Results show that global economic costs and the carbon prices needed to hit the stabilization targets are substantially lower with the technology available, and BECCS acts as a true backstop technology at carbon prices around $240 per ton of carbon dioxide. If driven by economics alone, BECCS deployment increases the use of productive land for bioenergy production, causing substantial land use changes. However, the projected impact on commodity prices is quite limited at the global scale, with global commodity price indices increasing by less than 5% on average. The effect is larger at the regional scale (up to 15% in selected regions), though significantly lower than previous estimates.

While BECCS deployment is likely to be constrained for environmental and/or political reasons, this study shows that the large-scale deployment of BECCS is not detrimental to agricultural commodity prices and could reduce the costs of meeting stabilization targets. Still, it is crucial that policies consider carbon dioxide removal as a complement to drastic carbon dioxide emissions reductions, while establishing a credible accounting system and sustainable limits on BECCS.

Impacts of Emission Policies in China on Air Pollution and Human Health

Abstract: Precursor emissions of air pollution can be reduced at emitting sources by end-of-pipe control policies or as co-benefits of climate policies that limit fossil fuel. Identifying cost-effective control strategies requires understanding policy costs, chemical non-linearities in pollution formation, and the value of health benefits. China suffers from severe air pollution, and is implementing both policies, but relevant studies are limited. This thesis incorporates three studies that examine the air quality co-benefits of China's recent climate policy for China and transboundary countries, and the potential changes in the sensitivities of inorganic PM2.5 to precursor emissions in China. The first study quantifies co-benefits of China's climate policy from reducing PM2.5 using a modeling framework that couples an energy-economic model with sub-national detail for China (C-RE\1) and an atmospheric chemical transport model GEOS­Chem. The effects of an illustrative climate policy, a price on CO2 emissions, are simulated under three stringencies. In a policy scenario consistent with China's recent pledge to peak CO2 emissions by 2030 (the 4% Policy scenario), national health co-benefits from improved PM2.5 pollution can partially or fully offset policy costs depending on chosen health valuation. This study also suggests co-benefits would rise with increasing policy stringency. Using the same model simulations. the second study further compares co-benefits from PM2.5 and ozone in China and three downwind countries (South Korea, Japan and the United States). This study suggests that under the 4% Policy scenario, avoided premature deaths from reducing ozone are about half of those from PM2.5 in China, and the total avoided deaths in trans boundary countries are about 4% of those in China. The third study examines the potential changes in the sensitivities of inorganic PM2.5 to precursor emissions in China in response to the current and projected national reductions in SO2 and NOx emissions. Under scenarios that reduce SO2 and NOx emissions, sensitivities to SO2 and NOx, emissions would increase, but sensitivity to NH3 emissions would decrease in January and July. The largest absolute changes in sensitivities are found in January for NOx and NH3. 

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