Gernot Wagner's Blog

Biking and Renewables

[caption id="attachment_2599" align="alignnone" width="640"] Illustration by Kelsey King/Ensia[/caption]

October 1, 2015 — There’s nothing quite like biking down clogged city streets, weaving in and out of traffic. For short distances, it’s faster than driving. It’s liberating. It’s fun.

It also makes it painfully clear that most roads aren’t made for bikes. Make one mistake, and you might end up dead. If you do everything right and the 4,000-pounder next to you makes a mistake, you still might end up dead. Few regular urban cyclists remain entirely unharmed throughout the years: A broken bone (“cut off by a van”), a scraped shin (“car door”), or perhaps simply drenched on an otherwise dry road (“I avoided the mud puddle; the car didn’t”).

Blame it on my day job, but as I was cut off by yet another driver fixated on his phone while cycling to work, I got to thinking that this is how wind and solar electrons must feel as they try to navigate the electric grid. There, too, the infrastructure and rules were designed for the conventional, fossil fuel-based generators, not their smaller, greener counterparts.

We need to get off gasoline-powered vehicles, the same way we need to get off fossil-powered electricity. Biking alone, of course, can’t eliminate fossil fuel-based transportation. It’s a niche alternative that chiefly works in densely populated cities filled with environmentally concerned citizens. What works in Berkeley, Boulder, Brooklyn and Boston won’t work everywhere. Neither can trains, by the way, another favorite of environmentalists. Most U.S. cities have a lot of catching up to do with their European counterparts, but, if anything, it will be electric vehicles that will truly help us make this transition.

Similarly, wind and solar can’t singlehandedly eliminate fossil fuel-based electrical generation. They have great potential, much more so than biking ever will. But there, too, are limitations — chiefly the (eventual) need for storage to eliminate all fossil fuel-based generation: coal, petroleum and natural gas.

Meanwhile, there are great benefits to pushing both green technologies. Biking helps get previously sedentary drivers to move, which, in turn, extends their lives and decreases societal health care costs, assuming injuries can be avoided by appropriate bike infrastructure. Every dollar invested in that infrastructure can pay for itself many times over.

Something similar holds for subsidizing infrastructure for renewables (and, for that matter, some energy efficiency measures). The reduction in the large and risky global warming externality typically offsets the costs of subsidies and other sensible policy interventions. Many of the right policies are indeed being put in place.

Still, some traditional utilities continue to fight the integration of rooftop solar and other renewables, the way New York City did with bikes in 1987 when it tried to ban them altogether from midtown Manhattan. Today, New York is decidedly friendlier to cyclists, with Mayor Michael Bloomberg adding over 300 miles of bike lanes to city streets, and a popular, still-expanding bike share program. Renewables, for their part, are increasingly welcomed onto the grid, with increased open access and grid management tools aimed at integrating intermittent renewable energy sources. Much more needs to be done.

Getting the Job Done

There’s one more parallel that might well dwarf all else: Biking for biking’s sake is fun on a sunny Sunday afternoon. On a Monday morning, when it’s about getting to a meeting on time and looking professional, transport choice comes down to getting there reliably, quickly, cheaply and without sweat stains.

Electricity is no different. Solar panels may be an interesting, even fun, choice for some. The feeling of energy independence and doing good is a bonus. But many times, it doesn’t matter where electrons come from, just that they do — reliably, cheaply and cleanly.

The ideal policy solution for energy is as clear as it is seemingly difficult to implement: Pay the full, appropriate price for electricity at the right time and place, including currently unpriced environmental costs. Once every electron comes with the appropriate price tag, the solar panel on your roof — or the solar farm down the road — may well carry the day. Or it might not. That’s OK, too. Having the right energy mix matters more than any one technology. The energy system is a system, after all.

Biking, too, is but one form of getting around. Appropriate gas taxes, congestion charges and parking fees help incorporate the full costs of gasoline-powered engines and encourage more alternative modes of transport — from electric vehicles to public transport and bikes. Meanwhile, outright subsidizing those alternative modes is surely the right step. Pushing those alternatives at scale is as sensible as pushing renewables, especially when it also means moving closer to the ideal pricing policies in the first place.

But pushing biking or any one form of alternative transport is no end goal in itself. At the end of the day, it’s about getting from A to B. That means — as it does for energy — getting the entire system right.

Published on Ensia.com on October 1st, 2015.

High Level Dialogue with Hon. Prakash Javadekar

High Level Dialogue with Mr. Prakash Javadekar, Indian Minister for Environment, Forests, and Climate Change

Monday, September 28th, 12:15 to 1:30 pm

William and June Warren Hall, 1125 Amsterdam Ave., 5th Floor, New York, NY 10027

Open to Columbia University affiliates.

New York Public Library

Climate Shock: The Economic Consequences of a Hotter Planet
September 21st, 2015, 6:30 pm
New York Public Library
455 Fifth Avenue, New York, NY

Further event details.

[embed]https://www.youtube.com/watch?v=Q4Kmq...

Statistics 101: Climate policy = risk management

By Gernot Wagner

Bjørn Lomborg reviewed my book, Climate Shock (Princeton University Press, 2015), joint with Harvard's Martin L. Weitzman, for Barron's over the weekend. He started it by stating that "global warming is real."

So far, so good.

But the book is not about whether the climate is changing. It is.

The book is about whether we are getting the order of magnitude of its effects right. Weitzman and I argue forcefully — in prose in the text, supported by a significant amount of research going into the 100-page end notes — that it's what we don't know that really puts the "shock" into Climate Shock. Lomborg asks how we can know that, if apparently we don't.

The answer is simple, and it's a statistical point that can't possibly be lost on Lomborg, a former lecturer on statistics. The set of distributions that most directly represent climate uncertainty — the link between concentrations of carbon dioxide and eventual temperature outcomes — is inherently skewed. We know, and Lomborg agrees, that adding carbon dioxide increases temperatures. (Back to 19th century science.)

So we can very clearly cut off the distribution linking a doubling of pre-industrial concentrations to temperatures at zero. In fact, we can cut it off at least at around 1 degree Celsius (almost 2 degrees Fahrenheit). The world, after all, has already warmed by over 0.8 degrees Celsius (around 1.5 degrees Fahrenheit), and we haven't yet increased pre-industrial concentrations by even 50 percent.

Reprinted from Climate Shock, with permission from Princeton University Press.

That skewedness of the underlying distribution is real. It's important. The correct response, then, to those who are too sure about where the climate system will go isn't to say, "cool it." It's to take the uncertainties seriously. Those, sadly, are skewed in one direction.

Climate risk is not our friend. It ought to prompt us to rethink not just how we talk about climate change. It should also inform our response. The burden of proof clearly rests on those who argue against these statistical facts.

First posted on Climate411.

Statistics 101: Climate policy = risk management

Bjørn Lomborg reviewed my book, Climate Shock (Princeton University Press, 2015), joint with Harvard’s Martin L. Weitzman, for Barron’s over the weekend. He started it by stating that “global warming is real.”

So far, so good.

But the book is not about whether the climate is changing. It is.

The book is about whether we are getting the order of magnitude of its effects right. Weitzman and I argue forcefully — in prose in the text, supported by a significant amount of research going into the 100-page end notes — that it’s what we don’t know that really puts the “shock” into Climate Shock. Lomborg asks how we can know that, if apparently we don’t.

The answer is simple, and it’s a statistical point that can’t possibly be lost on Lomborg, a former lecturer on statistics. The set of distributions that most directly represent climate uncertainty — the link between concentrations of carbon dioxide and eventual temperature outcomes — is inherently skewed. We know, and Lomborg agrees, that adding carbon dioxide increases temperatures. (Back to 19th century science.)

So we can very clearly cut off the distribution linking a doubling of pre-industrial concentrations to temperatures at zero. In fact, we can cut it off at least at around 1 degree Celsius (almost 2 degrees Fahrenheit). The world, after all, has already warmed by over 0.8 degrees Celsius (around 1.5 degrees Fahrenheit), and we haven’t yet increased pre-industrial concentrations by even 50 percent.

Reprinted from Climate Shock, with permission from Princeton University Press.

That skewedness of the underlying distribution is real. It’s important. The correct response, then, to those who are too sure about where the climate system will go isn’t to say, “cool it.” It’s to take the uncertainties seriously. Those, sadly, are skewed in one direction.

Climate risk is not our friend. It ought to prompt us to rethink not just how we talk about climate change. It should also inform our response. The burden of proof clearly rests on those who argue against these statistical facts.

This post was original posted on EDF’s Climate411 blog.

Statistics 101: Climate policy = risk management

By Gernot Wagner

Bjørn Lomborg reviewed my book, Climate Shock (Princeton University Press, 2015), joint with Harvard's Martin L. Weitzman, for Barron's over the weekend. He started it by stating that "global warming is real."

So far, so good.

But the book is not about whether the climate is changing. It is.

The book is about whether we are getting the order of magnitude of its effects right. Weitzman and I argue forcefully — in prose in the text, supported by a significant amount of research going into the 100-page end notes — that it's what we don't know that really puts the "shock" into Climate Shock. Lomborg asks how we can know that, if apparently we don't.

The answer is simple, and it's a statistical point that can't possibly be lost on Lomborg, a former lecturer on statistics. The set of distributions that most directly represent climate uncertainty — the link between concentrations of carbon dioxide and eventual temperature outcomes — is inherently skewed. We know, and Lomborg agrees, that adding carbon dioxide increases temperatures. (Back to 19th century science.)

So we can very clearly cut off the distribution linking a doubling of pre-industrial concentrations to temperatures at zero. In fact, we can cut it off at least at around 1 degree Celsius (almost 2 degrees Fahrenheit). The world, after all, has already warmed by over 0.8 degrees Celsius (around 1.5 degrees Fahrenheit), and we haven't yet increased pre-industrial concentrations by even 50 percent.

Reprinted from Climate Shock, with permission from Princeton University Press

That skewedness of the underlying distribution is real. It's important. The correct response, then, to those who are too sure about where the climate system will go isn't to say, "cool it." It's to take the uncertainties seriously. Those, sadly, are skewed in one direction.

Climate risk is not our friend. It ought to prompt us to rethink not just how we talk about climate change. It should also inform our response. The burden of proof clearly rests on those who argue against these statistical facts.

Push renewables to spur carbon pricing

Introduction:

Putting a price on carbon dioxide and other greenhouse gases to curb emissions must be the centrepiece of any comprehensive climate-change policy. We know it works: pricing carbon creates broad incentives to cut emissions. Yet the current price of carbon remains much too low relative to the hidden environmental, health and societal costs of burning a tonne of coal or a barrel of oil. The global average price is below zero, once half a trillion dollars of fossil-fuel subsidies are factored in.

[...]

The current inadequacy of carbon pricing stems from a catch-22. Policymakers are more likely to price carbon appropriately if it is cheaper to move onto a low-carbon path. But reducing the cost of renewable energies requires investment, and thus a carbon price.

In our view, the best hope of ending this logjam rests with tuning policies to drive down the cost of renewable power sources even further and faster than in the past five years. The cost of crystalline silicon photovoltaic (PV) modules has fallen by 99% since 1978 and by 80% since 2008; installation costs for wind power have also dropped, and solar and wind capacity has grown [...]. Prices will continue to fall, but — without more help — the decrease will not be fast enough to make a dent in the climate problem.

Full text: "Push renewables to spur carbon pricing"

Citation:

Wagner, Gernot, Tomas Kåberger, Susanna Olai, Michael Oppenheimer, Katherine Rittenhouse, and Thomas Sterner. “Push renewables to spur carbon pricing” Nature 525: 27–29 (3 September 2015).

Climate Shock on FT McKinsey Business Book of the Year longlist

By Gernot Wagner

"Business Book Award longlist: must-read titles of 2015" by Andrew Hill (Financial Times, 12 August 2015).

Climate Shock on FT McKinsey Business Book of the Year longlist

"Business Book Award longlist: must-read titles of 2015" by Andrew Hill (Financial Times, 12 August 2015).

Climate Sensitivity Uncertainty: When is Good News Bad?

Abstract:

Climate change is real and dangerous. Exactly how bad it will get, however, is uncertain. Uncertainty is particularly relevant for estimates of one of the key parameters: equilibrium climate sensitivity—how eventual temperatures will react as atmospheric carbon dioxide concentrations double. Despite significant advances in climate science and increased confidence in the accuracy of the range itself, the “likely” range has been 1.5-4.5°C for over three decades. In 2007, the Intergovernmental Panel on Climate Change (IPCC) narrowed it to 2-4.5°C, only to reverse its decision in 2013, reinstating the prior range. In addition, the 2013 IPCC report removed prior mention of 3°C as the “best estimate.”

We interpret the implications of the 2013 IPCC decision to lower the bottom of the range and excise a best estimate. Intuitively, it might seem that a lower bottom would be good news. Here we ask: When might apparently good news about climate sensitivity in fact be bad news in the sense that it lowers societal wellbeing? The lowered bottom value also implies higher uncertainty about the temperature increase, a definite bad. Under reasonable assumptions, both the lowering of the lower bound and the removal of the “best estimate” may well be bad news.

Full text: “Climate Sensitivity Uncertainty: When is Good News Bad?” Joint with: Mark C. Freeman and Richard J. Zeckhauser.

Prior versions published as NBER Working Paper w20900 and Harvard Kennedy School Faculty Research Working Paper Series RWP15-002 (January 2015).

Citation:

Freeman, Mark C., Gernot Wagner, and Richard J. Zeckhauser. “Climate Sensitivity Uncertainty: When is Good News Bad?” forthcoming in Philosophical Transactions A.