Unconventional Thoughts on Climate Change and What to do About It

As readers of this column may know by now, I not only live in Kansas, but was raised here. You know Dorothy, Wizard of Oz – and tornadoes. For tens of millions of Americans living east of Mississippi, tornadoes have become a way of life, or more accurately, a threat to life, for just about every night this spring.

            I just turned 74 and THIS IS NOT THE WEATHER WORLD I ONCE KNEW (and I’ll bet for most readers of this post, too). It’s not just tornadoes. The official body that tracks and predicts hurricanes, the National Oceanic and Atmospheric Administration (NOAA), forecasts that this hurricane season, which began June 1, will be unusually intense. https://www.msn.com/en-us/weather/topstories/noaa-2024-hurricane-season-forecast-warns-of-more-storms-than-ever-heres-why/ar-BB1mVkiz. The first named hurricane of the season is poised to strike Texas today. Another deadly and costly wildfire season has already begun in the West, following the record devastations in 2023, not only in the US but elsewhere around the world. https://www.axios.com/2024/05/15/us-wildfire-outlook-2024-climate-change. Severe drought is projected this summer for much of Kansas, New Mexico, and western Texas. https://www.cpc.ncep.noaa.gov/products/expert_assessment/sdo_summary.php. In Mexico City, home to 22 million, the drought is so bad that the city could run out of water in a month, without severe water rationing. https://www.msn.com/en-us/news/world/mexico-city-could-run-out-of-water-in-a-month-unless-it-rains/ar-BB1n5LyY. In contrast, other countries around the world – Brazil, Greece, Hong Kong, and Taiwan -- experienced devastating floods in 2023. And, as I write this, the entire East Coast is sweltering from a brutal heat wave this early in June, which has been widely noted to be highly unusual. But not surprising given the increasing global air temperatures you may already know about and which I will discuss in more detail shortly.

            You know where I’m headed with all this, of course. Although El Nino is likely aggravating severe weather disturbances this year, it is doing so on top of a trend increase in global air temperatures driven by climate change. Take a look at the chart from NASA in this link: https://climate.nasa.gov/vital-signs/global-temperature/?intent=121. The last ten years are the hottest, and the global temperature last year, the hottest since official tracking of temperatures began in 1880: an increase of 1.36C (or 2.45F) over pre-industrial levels.

            And yet, climate change skepticism continues.  15% of Americans deny climate change is happening, a figure that by geographic location is correlated with vaccination skepticism, and you guessed it, support for Donald Trump. https://news.umich.edu/nearly-15-of-americans-deny-climate-change-is-real-ai-study-finds/. Another 26% believe that global warming exists but is caused primarily by “natural patterns in the environment.” https://www.pewresearch.org/science/2023/08/09/why-some-americans-do-not-see-urgency-on-climate-change/. There are also plenty of skeptics that the rash of bad weather events here and around the world are connected to climate change. Two weeks ago, the editorial page writers at the Wall Street Journal marked the severe weather down to bad luck.

            As you know, I am an economist (and lawyer), and trained to look at both (a) probabilities of events occurring and their consequences and (b) how people and firms actually behave with the money that they have, not what they may say they would do in response to a poll question. It turns out there is one industry in America that also thinks this way: it’s the property-casualty insurance industry, both the primary insurers, like Allstate, Nationwide, and State Farm (among many others), and reinsurers, such as Munich Re and Swiss Re, that assume the catastrophic risks that primary insurers cannot afford or do not want to bear. Both groups of insurers have borne increasingly heavy losses due to the rising numbers and intensity of storms, ultimately passing on those costs to residential customers. On average, homeowner insurance rates nationwide went up 11% last year, but averages as we know conceal enormous variations. https://www.spglobal.com/marketintelligence/en/news-insights/latest-news-headlines/us-homeowners-insurance-rates-jump-by-double-digits-in-2023-80057804. Rates have skyrocketed in California and Florida, states home to well above average wildfire and hurricane risks.

I realize, of course, that other factors are driving up home insurance rates, most notably inflation, which has driven up construction costs. But even before the spate of several weather events of the past year, there were strong indications last year that the increasing numbers and intensity of severe weather events were a major factor behind premium increases. https://ehsdailyadvisor.blr.com/2023/06/insurance-companies-decline-coverage-due-to-climate-change-risks/?=&LeadSource=Google%20Ads&utm_adgroup=&gad_source=5. At that time, that same article reported that a survey of state insurance regulators indicated that “most expected all types of insurance companies’ climate change risks to increase over the medium to long term, including physical risks, liability risks, and transition risks. More than half of the regulators surveyed also indicated climate change is likely to have a high impact or an extremely high impact on coverage availability and underwriting assumptions.”

The insurance problem for homeowners would be even worse if insurers could use in addition to historical losses to set their premiums their projections from climate change models to set insurance rates, but generally state regulators won’t let them. As a result, where they can, insurers are increasingly choosing to pull out of offering any coverage at all in especially high-risk areas. Nationally, 12 percent of homeowners had no insurance in 2022, either by choice or because they couldn’t get coverage, up from 5 percent, just three years before.  https://www.pewresearch.org/science/2023/08/09/why-some-americans-do-not-see-urgency-on-climate-change/.

Insurers are not crazy or venal to be raising rates and withdrawing coverage. They can read what the scientists at NASA are saying about the link between climate change and severe weather, just as you can too. https://science.nasa.gov/climate-change/extreme-weather/.

            Yet to date, even for climate change worriers, and indeed especially climate change advocates, the national (and global) debate over what to do about it almost exclusively has centered on cutting emissions of “greenhouse gases” (GHGs), primarily carbon dioxide (CO2) emitted by the burning of fossil fuels. President Biden has advanced an “all of government” approach to this challenge, through the massive subsidies/tax credits for the purchase of EVs and the buildout of charging stations, and for solar and wind power, authorized by the admittedly wrongly named Inflation Reduction Act (IRA); through EPA regulations forcing electric utilities away from the use of fossil fuels; the SEC’s new climate change disclosure rules required of public companies; a new program for monitoring GHG emissions and modeling impacts of GHG; and principles for viable and effective markets for the trading of voluntary carbon offsets. Although climate regulations are or are likely to be bogged down in court battles. it is more than accidental that private sector clean energy investment of $239 billion in 2023, the first full year after the IRA was enacted, was 38% higher than in 2022. https://www.cleaninvestmentmonitor.org/reports/clean-investment-monitor-q4-2023-update. More private money is pouring into green energy because the government is incentivizing it. Even so, as the Biden Administration’s architect of that Act, Brian Deese, recently wrote in the Atlantic, the 32 gigawatts of clean electricity (solar, battery storage, wind, and nuclear) added to the grid since the Act represents “only about two-thirds of what’s necessary to stay on track with the IRA’s goal of reducing emissions by 40 percent by 2030.” https://www.theatlantic.com/ideas/archive/2024/05/climate-change-investment-utilities/678455/.

            US spending for emissions reduction so far, however, is a drop in the bucket compared to what is needed to reach the “net zero” emissions goal for the world by 2050, a target which if hit, would only give the world “an even chance” of keeping the post-industrial increase in global temperatures to 1.5 centigrade. https://www.iea.org/reports/net-zero-by-2050. According to the IEA’s report, $4 trillion annually in green investments will be necessary to achieve the 2050 net zero goal.

            It’s not all doom and gloom. As Kelly Sims-Gallagher usefully reminds us in her recent Foreign Affairs article, some progress is being made, albeit insufficiently noticed. Greenhouse gas emissions in most industrialized countries are now below 1990 levels, and in many countries, including the U.S., are on a downward trajectory. https://www.foreignaffairs.com/world/climate-change-policy-working-kelly-gallagher. Still, even with this progress, hitting global emissions targets will require a huge lift. According to UN projections, “predicted 2030 greenhouse gas emissions still must fall by 28 per cent to hold global temperature increases to 2°C above pre-industrial levels and by 42 per cent to be on the for the 1.5°C increase pathway. https://www.un.org/en/global-issues/climate-change.

            Even if the world somehow hits the net zero target in 2050 (as you can tell, I am a skeptic), that won’t reduce the frequency or severity of climate change-induced severe weather events. That is because of a fundamental fact of life I have written about in these posts before, and others have noted as well: more frequent and intense severe weather is already baked in the cake, as it were, because of GHGs already in the atmosphere: 472 parts per million CO₂ equivalents in 2021, up from 400 in 2010. https://www.eea.europa.eu/en/analysis/indicators/atmospheric-greenhouse-gas-concentrations. High ambient concentrations mean that even if the growth rate of emissions slows in the future, GHG concentrations will continue to increase, making the severe weather problem worse.

I worry that this fact alone will not only discourage climate activists, but potentially turn off ordinary voters from supporting progressively more costly steps to control emissions. After all, if the climate-related events that people can see and experience for themselves continue to get worse despite all of the investments in renewables, emissions regulations, and so forth, more people (voters) here and elsewhere are likely to say “what’s the point, nothing is working!”.

            Of course, that’s the wrong way to look at it. Compared to the kinds of weather we would experience if the US and world did not take steps to reduce emissions growth, severe weather events are likely to be fewer in number and less intense with the slower growth in global emissions. Scientists and lawyers call this paying attention to the “counterfactual.” The political problem is that voters can’t imagine counterfactuals. They only know or can realistically fathom what comes before and what comes after. If voters see no improvement in the scary parts of climate change – severe weather – compared to historical experience, I believe their willingness to accept the costs of emissions reduction understandably will wane (and eventually vanish?).

            Since severe weather is linked to high ambient concentrations, one logical solution is to reduce CO2 in the air by literally sucking it out – directly (Direct Air Capture or DAC) or by taking it out of the oceans (which translates into lowering atmospheric concentrations). The IRA contains $3.5 billion for DAC demonstration projects, which hopefully will bring down the costs of removing CO2 from the currently economically infeasible level of $400-1000 per metric ton of carbon to $100, or ideally much lower (with the IRA tax credits, that cost is $180 per ton). https://kleinmanenergy.upenn.edu/news-insights/the-calculus-on-direct-air-capture/#:~:text=Cost%20of%20DAC,for%20the%20carbon%20removal%20service. But even if the cost and other hurdles to DAC can be overcome – DAC requires vast amounts of land and finding effective ways to store all the CO2 removed or embed it in other materials is a super challenge – making a real dent in ambient CO2 levels through DAC will take years, if not decades.

            Similar scaling issues confront other ingenious ways of tackling a portion of the climate problem, such as preserving ice at the two poles of the earth, which theoretically could prevent a rise in ocean sea levels (but not the severe weather events associated with climate change). https://www.theatlantic.com/magazine/archive/2024/07/nasa-nisar-mission-glaciers-sea-ice-thwaites/678522/. https://www.economist.com/science-and-technology/2024/06/06/zany-ideas-to-slow-polar-melting-are-gathering-momentum. [Paywall protected].

That leaves only one other alternative, which readers of my past posts will recognize as something of a hobby horse of mine when it comes to climate change: solar geo-engineering, or spraying sulfur dioxide high in the atmosphere to reflect sunlight and thus cooling the earth’s air temperature. https://www.foreignaffairs.com/world/time-geoengineering-now-climate-change. Despite the risks – notably increased acidity in the oceans from the sulfuric acid formed through the spraying -- there is growing support in the scientific community for dedicating more research into geo-engineering. https://news.climate.columbia.edu/2024/04/24/solar-geoengineering-to-cool-the-planet-is-it-worth-the-risks/. Indeed, in 2023, the Office of Science and Technology Policy, an office within the White House, issued a report supporting more research into geo-engineering, which the US government currently funds at the $11 million level. https://kleinmanenergy.upenn.edu/wp-content/uploads/2024/01/KCEP-Digest-59-Solar-Geoengineering.pdf.

            $11 million is certainly better than 0, which is about where the level of government funding was several years ago. Moreover the $11 million plus the OSTP report mean that solar geo-engineering has come a long way over the past several years – from what was thought by just about everybody to be a crackpot idea, to one that is now scientifically respectable, even if not universally so.

            It will thus not surprise you that I believe a lot more funding is needed for outdoor geo-engineering experiments, and for testing ways for mitigating the risks. In the U.S. alone, severe weather events causing over $1 billion damage over the 2017-23 period cost over $1 trillion (https://www.climate.gov/news-features/blogs/beyond-data/2023-historic-year-us-billion-dollar-weather-and-climate-disasters#:~:text=The%20number%20and%20cost%20of,National%20Climate%20Assessment%20(2023)). Even if only an extra $50 billion in such events could be averted annually by geo-engineered cooling, such a benefit would easily swamp the estimated annual costs of solar-geo-engineering, which are in the $2 billion range. https://seas.harvard.edu/news/2018/11/calculating-solar-geoengineerings-technical-costs. Unlike the various carbon capture ideas, which would easily take a decade or more to be fully effective even if the cost hurdles can be overcome, solar geo-engineering, in principle, could be effective in cooling temperatures in a very short time. As for the downside risks, if they prove to be material, solar engineering always can be halted or slowed. What should not be slowed, however, until solar engineering is actually deployed, are current efforts to transition away from fossil fuels – though it must be recognized that if geo-engineering is fully deployed and is proven successful over some reasonable period of time in lowering global temperatures, green subsidies and carbon taxes eventually no longer will be necessary. That’s trillions of dollars every year, nothing to sneeze at.

            Because solar engineering would have global effects, ideally it ought to be agreed to worldwide. That’s the ideal. In the real world, which is fracturing before our eyes, that may never be possible. Still, there ought to be as much transparency as possible about geo-engineering R&D, plans and results, with a process for involving publics from around, in dialogues with scientists pursuing the research. More education about the benefits as well as the risks of geo-engineering is much needed.

            There is a cost to transparency, however, although one that must be borne. Consumers and firms will be reluctant to spend on green energy – whether it’s buying EVs, or using less carbon-intensive manufacturing methods – if and when it becomes more likely, through the ongoing publication about the progress of R&D, that geo-engineering will work and will be deployed. If real progress is and reported, the transition away from fossil fuels could be stalled for some interim period, while actors wait to find out whether solar geo-engineering is going to be deployed. I know of no way around this problem other than for public officials to communicate as clearly as they can about their intentions.   

            Despite all the reservations about solar geo-engineering, I believe this: given the rising costs of climate change, coupled with increasing uncertainty and anxiety about where and how severe weather will strike next, the odds are 50-50 that within the next 10 years, US and a coalition of the “willing” – most other developed economies and many lesser developed ones – will deploy solar geo-engineering in some form and at some level. In the meantime, until this happens, we will all have to get used to experiencing a lot more randomness from severe (deadly) weather in our lives.