Mumbai: From back-to-back winter storms in northeastern US to successive tropical cyclones in West Asia, the increasing number of bizarre weather events in 2018 have set alarm bells ringing on the impact of climate change across the globe.
A recent report by the UN’s Inter-Governmental Panel on Climate Change warned that “unprecedented" actions need to be taken to limit global warming, which, if unchecked, will cause extreme weather events and loss of biodiversity. While the urgency to keep global warming in check is recognized, the most efficient ways to do so may not be so evident. In a new research paper, Kenneth Gillingham of Yale University and James H. Stock of Harvard University find that the most commonly adopted and seemingly low-cost clean technologies could have unaccounted-for hidden costs. Mandating the use of biofuels, for instance, entail large subsidies.
On the other hand, technologies often dismissed as costly may prove more cost-efficient in the long run. For instance, the costs of using solar power panels and electric vehicles (EVs) have fallen sharply over time due to technological improvements enabled by a “learning by doing" effect. Additionally, incurring large costs in setting up clean energy infrastructure today can cut costs in the future. For instance, purchasing an EV today drives demand for charging stations, which in turn reduces the cost of EVs for potential customers. Ignoring such dynamics might lead policymakers to push policies with immediate benefits, like switching from coal to natural gas for power production. Indeed, natural gas is an attractive fossil fuel as it’s often cheaper and cleaner than coal. However, setting up natural gas power plants will only delay the transition to even cleaner options such as wind and solar. Since our choice of energy sources will affect humankind in the long term, the cost-benefit analysis of any energy source should also consider a long-term timeframe, the researchers point out.
Also Read: The Cost of Reducing Greenhouse Gas Emissions