New forms of climate denialism focus on imagined costs and sadly not real costs.

Using cost-benefit analyses allows us to measure the cost of climate change through the calculation of the social cost of carbon (SCC) which puts a monetary value on climate change harms by adding up all the future damages from the emission of one tonne of carbon dioxide now.

One of Joe Biden’s first executive orders was to begin the process of revising the SCC. Barack Obama was the first US President to order the  measuring of  SCC and the studies came up with a range of estimates from $50 per tonne to $150. Donald Trump then had it revised to between $1 and $7 by artificially limiting the calculations too damages solely in the US and omitted the rest of the world.

When Scott Morrison announced a series of ‘clean’ energy and climate abatement policies – along with massive subsidies – in September 2020 there was no mention of an SCC and a quick Google search finds lots of results for other countries on the issue but none for Australia.

If the Morrison government is working on a calculation, however, it is probable that it will follow the Trump lead and omit the massive global impact Australian fossil fuel exports have on the rest of the world.

In a Nature article (19 February 2021) a group of scientists provided eight priorities for the Biden administration in accounting for the increasing losses from storms, wildfires and other climate impacts.

The first was a no brainer: reverse the Trump changes and allow the estimates to cover global impacts. The others were: seeking broad multi-disciplinary input from experts and stakeholders; update the equations which quantify the impacts of climate change on human welfare; re-appraising climate risks for ‘known unknowns’ and ‘unknown unknowns’; review discount rates as Germany, the Netherlands, Norway and the UK have done to take into account falls in risk-free interest rates; updating forecasts for GDP and population growth; and, clarifying limitations in many areas where more knowledge is required – such as industry specific limitations and policies like the Biden plan to decarbonise the US electricity sector by 2035.

The Nature paper authors conclude: “Although the SCC is not the last word in climate-policy analysis, it is an essential clarifying metric. It is feasible to improve it within one year and to launch a process for continued updates thereafter.”

A more recent PNAS paper (24 August 2021) by Simon Dietz, James Rising , Thomas Stoerk and Gernot Wagner looks at economic impacts of climate tipping points and their impact on SCC estimates.

“Tipping points in the climate system are one of the principal reasons for concern about climate change. Climate economists have only recently begun incorporating them in economic models. We synthesize this emerging literature and provide unified, geophysically realistic estimates of the economic impacts of eight climate tipping points with an emphasis on the social cost of carbon, a key policy input,” they say.

The eight tipping points are in the broad categories of: positive carbon-cycle and temperature feedbacks; ice sheet disintegration; and changes in large-scale ocean circulation. The specific points include Amazonian dieback; Arctic sea ice disappearance and its impacts on sunlight reflection; variability in the Indian monsoon and the Gulf Stream slow down and/or reversal.

“Climate scientists have long emphasized the importance of climate tipping points like thawing permafrost, ice sheet disintegration, and changes in atmospheric circulation. Yet, save for a few fragmented studies, climate economics has either ignored them or represented them in highly stylized ways, “they say.

Instead, they provide “unified estimates of the economic impacts of all eight climate tipping points covered in the economic literature so far using a meta-analytic integrated assessment model (IAM) with a modular structure. The model includes national-level climate damages from rising temperatures and sea levels for 180 countries, calibrated on detailed econometric evidence and simulation modelling.”

Working on a probabilistic basis they estimate “climate tipping points increase the social cost of carbon (SCC) by ∼25% in our main specification. The distribution is positively skewed, however. We estimate an ∼10% chance of climate tipping points more than doubling the SCC. Accordingly, climate tipping points increase global economic risk. A spatial analysis shows that they increase economic losses almost everywhere.”

They also warn that most of their numbers are probably underestimates “given that some tipping points, tipping point interactions, and impact channels have not been covered in the literature so far.”

In another PNAS paper (12 July 2021) Michael E. Mann, Department of Meteorology and Atmospheric Science, The Pennsylvania State University, July 12 2021 revisits the ‘hockey stick’ curve.

He said: “More than two decades ago, my co-authors, Raymond Bradley and Malcolm Hughes, and I published the now iconic ‘hockey stick’ curve. It was a simple graph, derived from large-scale networks of diverse climate proxy …… data such as tree rings, ice cores, corals, and lake sediments, that captured the unprecedented nature of the warming taking place today.

“It became a focal point in the debate over human-caused climate change and what to do about it. Yet, the apparent simplicity of the hockey stick curve betrays the dynamicism and complexity of the climate history of past centuries and how it can inform our understanding of human-caused climate change and its impacts.”

He looks specifically at “the lessons we can learn from studying paleoclimate records and climate model simulations of the Common Era, the period of the past two millennia, during which the ‘signal’ of human-caused warming has risen dramatically from the background of natural varia.”

…and the good news is that Josh Frydenberg has got one thing right – companies, the US SEC, the Financial Stability Board Task Force on Climate-Related Financial Disclosures, and the French Government’s decision to make climate-risk disclosures mandatory for asset managers – all point to the need for climate action just as the better estimates of SCC do.

The problem for Australia though is that talking about the problem, making meaningless commitments and creating meaningless slogans is not going to be good enough.

The author is grateful to John Spitzer for the Nature and PNAS papers.