Climate change

Climate change is a serious problem. It will have worldwide impact, but is expected to be worst for the poorest and most vulnerable members of society. Below, we discuss three key approaches to reduce the harms of climate change: mitigation, geoengineering, and adaptation. However, it is difficult to reliably estimate their cost-effectiveness. Doing so involves making predictions about the future and extrapolating trends subject to high uncertainty.

Over the summer of 2013 we conducted a series of investigations into some climate change charities that we believe to be promising. Our findings are detailed in the reports below:

What is Climate Change?

Climate change—specifically man-made (anthropogenic) global warming—is often cited as one of the greatest dangers facing mankind in the 21st Century. Climate change refers to the rise in average Earth temperature that has been occurring since the late 19th century and still continues. Since the early 20th century, Earth’s mean surface temperature has increased by about 0.8 °C (1.4 °F), with about two-thirds of the increase occurring since 1980. Warming of the climate system is primarily caused by increasing concentrations of greenhouse gases produced by human activities such as the burning of fossil fuels and deforestation.

The Risks of Climate Change

Climate change is a large risk because of the potential problems it could create in the future. The World Health Organization states that increased climate change would create more exposure to thermal extremes and weather disasters, which could increase the incidence of malaria, diarrhoea, and malnutrition [1]. WHO estimates that an increase in 5,000 tonnes of carbon dioxide would lead to an expected loss of one disability-adjusted life year (DALY).

However, this method of assessing cost-effectiveness also does not capture all the potential negative side-effects of climate change, neglecting reduced economic productivity, damage to culture, forced migration, and biodiversity loss, among others.

The Economic Cost

The economic costs of climate change mitigation have been estimated, for example, in the Stern Review, which was conducted for the UK treasury. The report estimated that climate change could reduce global GDP by 5%, and up to 20% if a wider range of impacts was considered and if climate change was worse than expected. On the other hand, the cost of mitigating climate change was estimated to be only about 1% of global GDP annually. But uncertainty in how these economic benefits transfer to the least well off in society makes it difficult to apply these benefits to our analysis.

What Strategies Are There to Fight Climate Change?

The strategies to respond to climate change are broken into three categories: mitigation, geoengineering, and adaptation.

Mitigation

Mitigation strategies aim to reduce the total amount of carbon dioxide. This usually takes the form of achieving international agreements to set certain carbon thresholds or transition to more clean energy. The most prominent form of these schemes is “cap and trade”, where all nations agree to a certain set limit to how much carbon dioxide they will produce (the cap), but then agree that they can exceed the limit if they give money to countries that come under the limit (the trade), essentially purchasing the excess carbon savings of greener nations.

But mitigation strategies can include more than “cap and trade” and often include a variety of research initiatives. One promising avenue within climate change mitigation that may be more cost-effective is trying to either reduce the potent greenhosue gas HFC-23 or improve the efficacy of aluminum production. However, we currently don’t know of any organizations working on these two problems, and even if we did, it’s unlikely that such work would be as cost-effective as AMF.

See more in our section on Mitigation.

Geoengineering

Geoengineering involves large-scale attempts to purposely alter the climate with technology in order to reduce temperatures or otherwise offset global warming. For example, one proposal might be to spray a large quantity of seawater into the atmosphere in order to increase the reflectivity of clouds, thus reflecting more sunlight and reducing temperatures. Another proposal might involve finding some way to remove carbon dioxide directly from the atmosphere.

See more in our section on geoengineering...

Adaptation

A third way to respond to climate change might be to change our infrastructures, institutions, and behaviors in order to better respond to, handle, and endure a changing climate.

See more in our section on adaptation.

Can We Assess the Cost-Effectiveness of Climate Change?

Generally, making a cost-effectiveness estimate of climate change involves attempting to predict the future in a way that may not be reasonable and is prone to high uncertainty and error. For a few examples:

  • estimating the success of political coordination and international action is very difficult because we don’t know how countries end up influenced to cut back on CO2.
  • estimating success at deforestation tends to ignore market pressures, such as a reduced supply of logging increasing the price for wood, and that in turn leading to a higher demand for logging.
  • There are a large variety of non-profits working on climate change. A few of them even intentionally coordinate, share funds, and collaborate together, thus making it difficult to tell who was more impactful. And even among organizations that don’t collaborate, merely working on the same goal means it will be difficult to disentangle what each organization has done.

See more in our blog post “Less Burn For Your Buck: Which Climate Charities Are Most Effective in Reducing Emissions? (Part 1)”.

How Cost-Effective Might Climate Change Be?

While assessing the cost-effectiveness of climate change is difficult, there still is some initial analysis which suggests that while climate change is important to focus on, it might not be as important as focusing on what we currently recommend, like fighting malaria and deworming.

Copenhagen Consensus's Estimate

The Copenhagen Consensus 2012 panel, a panel of five expert economists that included four Nobel prize winners, ranked research and development efforts on green energy and geoengineering among the top 20 most cost-effective interventions globally, but ranked them below the interventions that our top recommended charities carry out. Our own initial estimates agree, suggesting that the most cost-effective climate change interventions are still several times less effective than the most cost-effective health interventions.

These estimates are highly uncertain, however, and we do not rule out the possibility that climate change interventions may actually be more effective than our current recommended charities. The uncertainty in our estimates results from a lack of clarity in our understanding of the relationships between our actions, climate, and global health, as well as vagueness about the future actions that humanity will take to avert the negative consequences of climate change.

World Health Organization's Estimate

Given that we estimate Against Malaria Foundation saves a DALY for each $30-$50 donated and WHO estimates an increase in 5,000 tonnes of carbon dioxide would result in the loss of one DALY, an organization would need to be able to reduce carbon dioxide at a cheaper rate than $0.02 per tonne in order to be more cost-effective than AMF.

Organizations We've Investigated

However, we haven’t been able to identify any organizations that reduce carbon dioxide at a rate cheaper than $0.02 per tonne. Right now, we think the cheapest opportunity is Cool Earth, which we have made a highly uncertain guess might reduce carbon dioxide emissions for $0.81 each, which is about 40x more expensive than it would need to be in order to be better than AMF.

Though we still must be careful in saying this. Independent experts have suggested that this estimate has an uncertainty so large that it could easily be 10 or more times smaller or larger than the numbers presented above. However, we haven’t been able to identify any organizations that reduce carbon dioxide at a rate anywhere near this value.

See more in our forthcoming blog post on climate change charities...

Sources:

  1. Anthony J. McMichael A, Campbell-Lendrum D, Kovats S, Edwards S, et al. Global Climate Change. In: Ezzati M, Lopez A, Roders A et al. Comparative Quantification of Health Risks, Global and Regional Burden of Disease Attributable to Selected Major Risk Factors, Geneva, World Health Organization, 2004, pp. 1543-1650.