Air-quality improvements offset climate policy costs

Friday, January 22, 2010

From a news release issued by the UW-Madison:

MADISON - The benefits of improved air quality resulting from climate change mitigation policies are likely to outweigh the near-term costs of implementing those policies, according to a new study.

Coming on the heels of the international climate talks in Copenhagen and a proposal earlier this month by the U.S. Environmental Protection Agency to tighten smog standards, new research from the University of Wisconsin-Madison suggests that climate change policies should be assessed on the basis of potential benefits as well as initial costs.

Writing online Jan. 22 in the journal Environmental Research Letters, University of Wisconsin-Madison researchers Gregory Nemet, Tracey Holloway and Paul Meier report that the value of "co-benefits" - especially improved public health due to better air quality - rarely factors into assessments of climate change policy.

"The debate is really about how expensive this is going to be, and it excludes the social benefit," says Nemet, an assistant professor of public affairs and environmental studies at the La Follette School of Public Affairs and the Nelson Institute for Environmental Studies at UW-Madison. "That hasn't really been part of the equation."

Rather, policy assessments and decisions typically focus on cost-minimization without balancing those costs against the value of the resulting benefits, an approach that misrepresents the true economic impact of climate change policies, the researchers say.

In a survey of existing studies on air quality co-benefits, the researchers found 48 estimates ranging from $2 to nearly $200 per ton of carbon dioxide avoided, with an average benefit of $50 per ton. The highest values were in developing countries, where reducing pollution is likely to have the greatest impact on human welfare.

These benefits far outweigh the costs of carbon dioxide mitigation, which currently proposed policies limit to less than $30 per ton.