Often, giving people a reason to think or act in a certain way is one of the most powerful tools one can employ. The hope of those concerned about climate change is that these reasons can be mutually communicated and agreed at the Conference of the Parties (to the UNFCCC) in Paris later this year.
Indeed, the text of the communique resulting from COP 20 in Lima last year talked of “common and differentiated”responsibilities, and targets, reflecting “different national circumstances”, as key to future discussions. So whether reductions in emissions be achieved via in-country policies, such as taxes, or by a global carbon trading scheme, answering the question as to who should pay more or less, is potentially very important.
Implicit in the assumption that present day populations should bear a cost for the emissions of their ancestors is the idea t hey have benefitted from those emissions. After all, only a certain portion of historic emissions have actually been directly made by populations alive today.
So the most obvious candidate to distribute the costs involved would be historic emissions of a nation divided by the present day population size of thatnation. A discount factor could be applied, looking back over time, in order to sum historic emissions together and bring them to a present day total. This discounting could, in theory, link the ‘ responsibility’ attached to emissions to the improvement in understanding of climate change which has occurred over time.
However, natural capital (such as fossil fuels) is not always converted successfully into other, long-term income yielding forms of capital such as legal and educational institutions. It seems unlikely that accounting for variation in nations’ relative success or failure in this capital-conversion task (known to economists as ‘ genuine savings’ ) should, or even could, be fully accounted for in answering the question as to who should pay for climate change today. Nevertheless one might at least expect those countries where economic benefits had not really been felt to argue in favour of this theoretical link between benefit from and responsibility for historic emissions.One might argue that a simple discount rate applied to all historic emissions account s for the fact the conversion is not always 100%.
Working against historic discounting of emissions, however, might be the longer atmospheric residence time of emissions made further back in time. The calculation would also have to take into account that of historic emissions (of CO2 anyway), roughly 50% have so far been absorbed by the planet’ s oceans and terrestrial ecosystems.
This present-day divvying-up of ‘ responsibility’ could be combined with short term per-capita projections of actual costs to reduce carbon (marginal abatement curves), for specific countries, in some kind of purchasing-power-parity terms, to arrive at a near-term target for each nation.
If a global carbon budget could be agreed, out to a future point in time where there are zero emissions, then the correct relative allocation in costs, out to the same point in time, could reasonably be projected as well, given emissions and population size are reasonably foreseeable. However, the missing knowledge would be the economic cost to each nation of a given reduction, per unit of carbon, at a given point in the future, because this is highly dependent on alternate fossil fuel prices, and innovations that will have occurred. These future carbon abatement curves would therefore be needed, in theory, to arrive at long term carbon targets.
One might hope, however, that reasonable assumptions could be made in this area, so as to achieve sufficient confidence in the long term scheme (any confidence would be nice), and that firm targets for the short term could be accompanied by indicative goals beyond. A mechanism of looking forwards at regular periods of time to divvy up short term costs, so as to stay within the original carbon budget set, whatever the total of those short term costs might come to, would be the obvious way to address this issue. I understand such a mechanism is under discussion.
If all this, in terms of numbers and analysis feeding into discussions, is too much to hope for in Paris, what can at least b e hoped for is a universal appreciation of the principles involved, and that a similar outcome might be replicated by an iterative process of target -pledging. There is certainly hope.