Archives for October 31, 2006

Some British economist puts out a report on the economics of climate change for her majesty the Queen and the Australian media and the Left go gag-gag. Fran Kelly from your ABC announced it as The Report the world has been waiting for.

Lying in bed this morning listening to Fran, I was wishing, yet again, that Australia was a republic.

I’ve since made it to my computer, opened the report and discovered the Executive Summary, at least, isn’t too bad.

Sir Nicholas Stern begins by repeating that the scientific evidence is now overwhelming: climate change is a serious global threat, and it demands an urgent global response.

Sir Nicholas Stern then explains the methodology used to determine the global economic cost of climate: “a number of different techniques to assess costs and risks.”

I am impressed that the report acknowledges that climate change is a global issue and therefore stresses the need for an international response. Contrast this with Kyoto where the expectation is that only the developed world needs to actually do anything. The Executive Summary suggests a key element of any future international framework should be the expansion and linking of the growing number of emissions trading schemes to promote cost-effective reductions in emissions and bring forward action in developing countries.

The Executive Summary also acknowledges the importance of adapting to climate change with reference to the importance of building resilience because it is no longer possible to prevent climate change. Building on this theme the Executive Summary finishes with comment about the importance of research into new crop varieties that will be more resilient to drought and flood. On this point I assume Sir Nicholas Stern would support the lifting of the ban on GM food crops which limit the commercialization of new crop varieties in Australia.

Interestingly the Executive Summary states that coal will continue to be an important source of energy into the future and advocates carbon capture and storage to allow the continued use of fossil fuels without damage to the atmosphere. This could be interpreted as an endorsement of the Australian Government’s approach with money pledged just yesterday for a carbon capture project in central Queensland.

The report appears to be based on at least one very flawed assumption. The Executive Summary repeats and repeats the misconception that we can some how stabilize atmospheric levels of carbon dioxide. If what Sir Stern is trying to say, is that we should endeavor to not add any more carbon dioxide to the atmosphere then he should be clearer in his language. Even Al Gore, in his movie ‘An Inconvenient Truth’, acknowledged that atmospheric carbon dioxide levels have always fluctuated. Does anybody seriously think they could be stabilized in the future?

The Executive Summary is as misleading as Al Gore’s movie when it states that the cost of extreme weather, including floods, droughts and storms is already rising. Why yes, because there are more people building more expensive houses in places like Florida. But this does not mean that the number of extreme weather events has increased, a mistake both Gore and Sir Stern appear to make.

I haven’t yet read beyond the Executive Summary, but I note that according to today’s The Australian in a piece entitled ‘Bell tolls down under on warming’ in the detail of the report, it is claimed the east coast of Australia already has longer droughts and declining rainfall. Surely Sir Stern checked the charts at the Australian Bureau of Meteorology which don’t show any long term decline in rainfall. I hope he didn’t base his analysis on media headlines or modelled output?

I am also concerned that the economic analysis fails to mention any of the benefits of living in a warmer world. Then again the report does state up front that it is based on “costs and risks”. But, hang on, there will be some benefits. For example, there are significant potential benefits from the likely longer growing season for agriculture in Europe and North America.

It is also a bit annoying that the Executive Summary of such an evidently important report, apparently based on “costs and risks”, fails to explain what the biggest costs are going to be. According to the report, global warming is going to cost trillions, but I guess I am going to have to read 700 pages if I am to understand exactly why. Is the biggest cost the potential displacement of people now living in cities beside the sea?

The Queen of England’s House of Lords brought down a very large report on this same topic just last year and it came to a very different conclusion. Interestingly that report was pretty much ignored by the Australian media. What is it about Sir Nicholas Stern, that the Fran Kelly’s of this world so like? Does Sir Stern have a good publicist, or is it all in his name?

You can read the full stern report by clicking here.

You can read the House of Lords’ report by clicking here.