How Useful Are Models of Climate Change

This is a great read. It does combine in one rather short article a discussion of what models purport to do and it discusses specifically the shortcomings/advantages associated with climate change models. Please note the last sentence:

"it is better to be roughly right than precisely wrong—or not to make any estimate at all".

 

Oct 5th 2013 |From the print edition

MODELS simplify. They are supposed to. It is a feature, not a bug. Their formulae may be complex but models deliberately omit some things in order to focus on others. They also leave out factors that cannot be modelled satisfactorily. That is understandable, but what if the factors that cannot be modelled make a huge difference to the outcome? And what if the things that are excluded tend to produce a systematic bias in the results?

That is precisely the situation facing those who model the economic impact of climate change, argue two new studies (see sources below). Nicholas Stern, the author of an influential 2007 review of the economics of climate change, says the models minimise environmental damage. Robert Pindyck of the MIT Sloan School of Management goes further, saying the inputs economists use are so arbitrary that their models say almost nothing useful.

Both think climate models play down or leave out “tipping-point” risks that may not affect the climate yet but could do one day. Examples of such risks include crop yields—which could decline gradually in response to global warming, and then lurch over a cliff—and the possibility that swathes of Siberia might warm, releasing huge stocks of methane that lie locked up in the permafrost. Since methane is a greenhouse gas, that could produce a vicious cycle of more warming and more gas emissions. A recent study in Nature reckoned that if the methane in the Arctic were ever to escape, it could (the authors guessed) do $60 trillion of damage—although there is no sign that this is happening.

Economic models—known as Integrated Assessment Models (IAMs)—borrow the limitations of climate models and add problems of their own. Lord Stern argues that they tend to underestimate environmental damage, and wrongly assume that long-term economic-growth rates will continue unaffected even if the climate changes profoundly (see article). Mr Pindyck objects that the basic assumptions economists make about things such as discount rates and the response of temperatures to rising carbon concentrations are so arbitrary that, as he puts it, “these models can be used to obtain almost any result.”

Economic models typically incorporate losses or damage (from recessions as well as from climate change) by lowering the value of a flow of output rather than reducing the value of the stock of capital, land or labour. Usually, this makes sense. But climate damage may be different. If, say, sea levels were to rise, which they did by almost 20cm in the last century, they could inundate coastal cities and destroy large amounts of productive capital and land (to say nothing of damage to life and limb). That would affect not only current but also future output.

The models also tend to underestimate damage from climate change because, as William Nordhaus of Yale University has noted, they are extraordinarily poor at extrapolating beyond a warming of more than 3°C. One of Mr Nordhaus’s own models assumes that a rise of 19°C would be associated with a loss of half of world output. Warming on that scale would more probably be associated with the extinction of human life on Earth. Many models imply the world would be better off despite higher concentrations of carbon dioxide of up to 650 parts per million (compared with 400ppm now). To most climate scientists, 650ppm looks like a Mad Max scenario. Mr Pindyck calls the models’ assumptions about climate damage “completely made up”.

Lord Stern argues that their treatment of growth is not much better. Most models assume there is an underlying “exogenous” growth rate (ie, one that keeps chugging along regardless of what else is going on in the model). Even when this rate is fairly low—growth of 1% a year, say—the magic of compounding means that after 100 years, output will have almost trebled (see chart, column 2). If the growth rate were 3%, output would rise almost 20-fold.

Now combine those results with the models’ tendency to underestimate climate damage. Even if the loss in economic output were reckoned at 50% (ie, the loss associated with a life-obliterating 19°C rise in temperatures), the models still say future generations would be better off (see chart, column 4). At a growth rate of 1% a year, for example, it would take an output loss of two-thirds to make people worse off in 2100. These results are incredible. The problem is not that climate change will certainly leave people worse off in future. Rather, it is that it could do so if things got bad enough. But the models almost rule that possibility out. As Lord Stern says, they “come close to assuming that the impacts and costs [of global warming] will be modest, and close to excluding the possibility of catastrophic outcomes.”

Not useless, just plain wrong

The question is whether it is nevertheless useful to have some guide to the future cost of climate change, however inexact. Mr Pindyck’s answer is radical: forget the models. He calls them “close to useless as tools for policy analysis…their use suggests a level of knowledge and precision that is simply illusory.”

Lord Stern is a little more hopeful. He points out that scientists are producing a new generation of climate models and urges economists to do the same. But to work, he says they require sweeping changes to incorporate the idea that global warming can damage capital stock, productivity and growth. They would also, he says, need low or even negative discount rates, to reflect the possibility that future generations will be worse off than the current one. That is controversial: the use of a low discount rate in the “Stern review”, the 2007 study that used some of the models he now complains of, was heavily criticised. But as John Maynard Keynes is supposed to have said, it is better to be roughly right than precisely wrong—or not to make any estimate at all.

S. Korea Should Decrease Reliance on Nuclear Power.

 

Sat, Oct 12 2013

By Meeyoung Cho

SEOUL (Reuters) - South Korea should reduce its reliance on nuclear power in view of public discontent with corruption in the industry and Japan's difficulty tackling the aftermath of the Fukushima disaster, a group weighing up the problem said on Sunday.
The Energy Ministry published the findings of a study group of 60 representatives from industry, academic institutions and civic bodies that recommended reducing to between 22 percent and 29 percent the portion of electricity that can be generated by nuclear power. That compares to 41 percent proposed in a government plan for 2030.
Asia's fourth-largest economy currently generates one third of its electricity from nuclear power as part of long-term efforts to replace imported oil and gas.
Agreement on a range of 22-29 percent was reached "based upon consensus to minimize social conflict over the proportion of nuclear power generation," the study group said in a statement released by the energy ministry.
The government will hold public hearings over the report's conclusions and plans to draw up final revisions to energy policy in December, it said.
The group also recommended keeping the proportion of renewable energy at 11 percent as planned. It suggested imposing taxes on coal-fired power stations and lowering taxes on liquefied natural gas and kerosene.
Public discontent over nuclear power has been fanned by a scandal over the use of fake certificates which, since 2012, has prompted a series of reactor shutdowns in South Korea.
The nuclear industry has been criticized for breeding a culture of secrecy that led to corrupt practices among officials involved in safety certification.
Six of 23 reactors remain off line, including three halted in May to replace cables supplied using bogus certificates. Authorities on Thursday said 100 people, including a top former state utility official, had been indicted on corruption charges.
The head of the group, Kim Chang-seob, said the figures provided were intended strictly as guidelines to take account of trends and growing discontent over the nuclear sector.
"Our suggestion is to set the direction in the policy for social consent, as there are huge social conflicts," Kim said.
Anxiety has also risen over repeated setbacks by the Tokyo Electric Power Company (Tepco) in its efforts to halt radiation leaks and make safe the Fukushima plant north of Tokyo, which was crippled by an earthquake and tsunami in 2011.
Tepco last Thursday said radiation levels in seawater just outside the plant had climbed to their highest level in two years.
Japanese Prime Minister Shinzo Abe has been criticised since he declared the problems at Fukushima "under control".
Japan's Nuclear Regulation Agency earlier this month ordered Tepco to draft in additional workers and report on its measures to tackle the clean-up.
(Reporting by Meeyoung Cho; Editing by Ron Popeski and Jason Neely)

New Sustainable Deveklopment Goals

 

UN brewing up new -- and expensive – global 'sustainability development goals'

By George Russell

Published October 03, 2013

EXCLUSIVE: The United Nations is planning to create a sweeping new set of “sustainable development goals” for the planet that will likely require trillions of dollars of spending on poverty and the environment, a drastic reorganization of economic production and consumption -- especially in rich countries -- and even greater effort in the expensive war on climate change.
It’s an agenda that its prominent boosters have declared will make the next 15 years “some of the most transformative in human history,” although the exact nature of the goals themselves, and how they are to be achieved, is unclear.
In typical U.N. fashion, panels of high-profile international figures have offered up their views, task forces have been commissioned to come up with suggestions, hundreds of non-governmental organizations have been polled, and a 30-nation working group is holding sessions that will extend early into next year before offering more concrete suggestions to the U.N. General Assembly, where they will be further chewed over.
The goals themselves are slated to become a program of the U.N.  -- and all the nations that endorse them -- in 2015, as part of what U.N. Secretary General Ban Ki-moon has called  “a universal sustainable development agenda” for the planet -- an equally undefined set of far-reaching aspirations for global environmental management and new and expanded roles in the future for the U.N.’s sprawling array of funds, programs and institutions.
They are supposed to be endorsed at an as-yet-unplanned global U.N. summit -- the successor to the Rio + 20 summit on sustainable development which boosted the current elaborate process -- in 2015.
According to skeptics such as William Easterly, an economics professor and co-director of New York University’s Development Research Institute, the program also has great potential to become a “huge unworkable mess.”  So far, Easterly says, what he sees is a “confused mashup of every development fad of the last 20 years” married to the aim of giving the U.N. a more central role in economic development -- “not a good thing,” in his opinion.
Other experts, such as Charles Kenny, a senior fellow at the Center for Global Development in Washington, are more forgiving. The still-unformed SDGs, he says, are “a way to frame conversations about where we want to be and how much progress we can make. I think right now we're in the negotiation stage. We'll get to the campaign in 2015.”
In effect, the U.N. is hoping to double down on the mixed success of its so-called Millennium Development Goals, or MDGs, an eight-point program of mostly anti-poverty measures that was endorsed in 2000 and is slated to expire in 2015 -- when the new sustainable development goals, or SDGs, are intended to take their place.
The MDGs aimed largely at improving life for the globe’s most desperate people. They included such targets as cutting in half the number of people around the world living in extreme poverty (less than $1.25 per day); reducing child mortality rates by two-thirds; reversing the spread of HIV/AIDS, malaria, and other killer diseases; and cut in half the number of people without access to safe drinking water and sanitation.
In a number of cases, the MDGs have already succeeded:  The number of people living on $1.25 a day, for example, was cut in half by 2010, according to the U.N. -- though most of that change was due to the massive economic transformation of China, and to a lesser extent, India.
The number of children under age 5 dying each year has also declined, from 12.4 million to 6.6 million -- less than the  Millennium Development Goal, but still substantial progress. The same applies to rates of HIV/AIDs and malaria, largely due to the efforts of the Global Fund to Combat AIDS, Tuberculosis and Malaria, initially sponsored by the Bill and Melinda Gates Foundation.
Given the diverse sources for the relative success of the MDG effort, there is no telling how much they have cost. But Ban is still exhorting everyone to ante up further. “We must do everything we can to achieve the MDGs by the end of 2015,” he told a special “high-level event” at the U.N. on September 25, while hailing some $2.5 billion in new contributions from governments, philanthropies and corporations.
The Sustainable Development Goals, however, are much more sweeping, and likely to be much harder to measure. Their overall aim -- at least so far -- is to marry the specific targeting of the most successful MDGs with the much more sweeping and imprecise language of “sustainability” -- a term that has never been very specifically defined.
Roughly speaking, “sustainability” is supposedly centered on the social, economic and environmental well-being of individuals, societies and the entire planet -- but without the precision of hard-edged economics to measure its inputs and outcomes.
Instead, the new development agenda is characterized as “one that seeks to achieve inclusive, people-centered, sustainable global development,” in the words of a U.N. task force composed of some 50 U.N. agencies and international organizations, which reported on the topic last year.  It would also include unspecified “reforms of mechanisms of global governance.”
Among other things, the task force declared,  “Immediate priorities in preserving environmental sustainability in­clude ensuring a stable climate, stopping ocean acidification, preventing land degradation and unsustainable water use, sustainably managing natural re­sources and protecting the natural resources base, including biodiversity,” -- in short, a total, and global, environmental renovation that includes the draconian limits on carbon emissions agreed to in the Kyoto Protocol, which the U.S. has not ratified.
(According to U.S. Assistant Secretary of State Dean Pittman, speaking in New York last week, the U.S. is already “investing approximately $800 million per year” through President Obama’s newly announced Global Climate Change Initiative “to address the climate needs of developing countries.”)
Additional topics that the old MDGs did not address, that the task force mentioned, included “productive employ­ment, violence against women, social protection, inequalities, social exclusion,” as well as “persistent malnutrition and increase in non-communicable dis­eases, reproductive health and complexities related to demographic dynamics, peace and security, governance, the rule of law and human rights.”
Atop that, the task force said, “Sustainability also implies ensuring inter-generational justice and a fu­ture world fit for children. This entails safeguarding a sustainable future in which children will be able to grow up healthy, well-nourished, resilient, well-educated, culturally sensitive and protected from violence and neglect.”
In short, pretty much everything.

The themes of occasional highly specific potential targets coupled with sweeping objectives are deeply embedded in the report this summer of  a U.N.-sponsored, 27-member High-Level Panel  on the post-2015 Development Agenda, appointed by Ban in July 2012, which included British Prime Minister David Cameron among its top-tier members.
The report declared that the world must “finish the job that the MDGs started,” and eradicate “extreme poverty from the face of the earth by 2030” -- meaning raise the standards of the estimated 1.2 billion people still living on less than $1.25 per day.
The panel left fill-in-the-blanks percentages -- assuming much further discussion ahead -- for suggested measurable goals, such as reductions in the mortality rate for child-bearing women, or in the number of children whose growth is stunted annually by malnutrition.
But the panel also added such things as “prevent and eliminate all forms of violence against girls and women;” “adopt sustainable agricultural, ocean and freshwater fishery practices and rebuild designated fish stocks to sustainable levels;” and “safeguard ecosystems, species and genetic diversity.”
Some of these goals, the panel admitted in a discreet footnote, “require further technical work to find appropriate indicators” of success.

What all of this might cost is also largely unexamined. Instead the panelists focus on benefits, often arrived at by elaborate methods. Thus, the report states, “Every $1 spent to reduce stunting [of growth in children] can yield up to $44.50 through increased future earnings.”
(The 2012 research paper cited by the panel, and examined by Fox News, sets the overall cost of a campaign to reduce the number of underweight children by 10 million annually -- along with 210 million adults -- at about $154 billion, in current terms. It assumes an averaged 15 percent increase in individual income due to higher agricultural productivity in Bangladesh, Ethiopia, Kenya and India as the main source of benefits.)
Nonetheless, observers development expert Kenny, a supporter of the goals, “given progress toward wiping out $1.25 a day poverty and the global decline in malnutrition, the eventual aim of close-to abolishing hunger so-defined doesn't sound implausible to me (even if it might be implausible by 2030).”
Of the rest, he says, “think of the proposal as a long list that will be chipped away at on the grounds of political and practical plausibility both in terms of measurement and achievement.”
Skeptic Easterly sees the new goals -- not to mention the long, elaborate ramp up, the incessant consulting, and frequent consultation with experts who essentially agree on the process -- differently.
As he puts it:  “Compared to this, the Millennium Development Goals look like masterpieces of clarity. This process seems to get worse over time.”
George Russell is editor-at-large of Fox News and can be found on Twitter @GeorgeRussell