Studies examined in the TAR suggest substantial
technological and other opportunities for lowering mitigation costs.
responses to climate change can be more effective if deployed as a portfolio
instruments to limit or reduce net greenhouse gas emissions. The
costs of mitigation are strongly affected by development paths, with
paths involving substantial increases in greenhouse gas emissions requiring
more mitigation to reach a stabilization target, and hence higher costs.
These costs can be substantially reduced or even turned into net
benefits with a portfolio of policy instruments (including those that
help to overcome barriers) to the extent that policies can exploit "no-regrets"
opportunities in the following areas:
- Technological options: Technological options may achieve
global emissions reductions of 1.9 to 2.6 Gt Ceq yr-1
by year 2010 and 3.6 to 5.0 Gt Ceq yr-1 by year
2020. Half of these reductions may be realized with one component of
their economic cost (net capital, operating, and maintenance costs)
with direct benefits exceeding direct costs, and the other half with
that component of their economic cost ranging from US$0 to US$100 per
t Ceq. 26
Depending on the emissions scenario, global emissions could be reduced
below year 2000 levels over the 2010 to 2020 time frame. Key
uncertainties are the identification, extent, and nature of
any barriers that impede adoption of promising low-emission technologies,
and the estimation of the costs of overcoming the barriers.
- Ancillary benefits: Depending on factors (such as location
of the greenhouse gas emissions, the prevailing local climate, and the
population density, composition, and health) the magnitude of the ancillary
benefits of mitigation may be comparable to the costs of the mitigating
policies and measures. Key uncertainties are the magnitude
and location of these benefits involving the scientific assessment and
valuation of health risks of air pollution, particularly those involving
fine aerosols and particles.
- Double dividends: Instruments (such as taxes or auctioned
permits) provide revenues to the government. If used to finance reductions
in existing distortionary taxes ("revenue recycling"), these
revenues reduce the economic cost of achieving greenhouse gas reductions.
The magnitude of this offset depends on the existing tax structure,
type of tax cuts, labor market conditions, and method of recycling.
Under some circumstances, it is possible that the economic benefits
may exceed the costs of mitigation. Key uncertainties
regarding the overall net costs of mitigation vary between countries,
depending on the existing tax structure, the extent of the distortion,
and the type of tax cuts that are acceptable.
Q7.6-7, Q7.14-15, Q7.20,
& Q7.23, & Q7
Modeling studies show that emissions
trading reduces costs of mitigation for those participating in the trading.
Global modeling studies, with results depending strongly upon assumptions,
project that costs of mitigation based on Kyoto targets are likely to
be reduced by full carbon-permit trading within the Annex B27
group of countries. Annex I OECD28
countries may expect aggregate costs to be reduced by about half
through full permit trading. Annex I economies in transition
are projected to be unaffected or to gain several percent increase in
GDP. Oil-exporting, non-Annex I countries may also expect similar
reductions in costs under such trading. The aggregate effects of trading
are expected to be positive for other non-Annex I countries.
Those countries that may expect a loss or gain without Annex I trading
may expect a smaller change with trading. A key uncertainty
is the extent of the underlying costs, which vary widely across
countries, and how these cost estimates will be changed (a) when methods
are improved and (b) when some of the assumptions of the models are relaxed.
Such assumptions are concerned with:
- Allowance for exemptions in the emission-permit trading in concert
with other policies and measures
- Consideration of various market imperfections
- Allowance for induced technical change
- Inclusion of ancillary benefits
- Opportunities for double dividends
- Inclusion of policies for non-CO2 greenhouse gases and
non-energy sources of all greenhouse gases (e.g., CH4 from
- Offsets from sinks.
||Although model projections indicate that
long-term global growth paths of GDP are not significantly affected by mitigation
actions towards stabilization, these do not show the larger variations that
occur over some shorter time periods, sectors, or regions.
||Unexpected public policies ("quick
fixes") with sudden short-term effects may cost economies much more
than expected policies with gradual effects. A key uncertainty
in the magnitude of the costs lies in the existence of well-designed contingency
plans in the event of policy shifts (e.g., as a result of a sudden shift
in public perception of the climate change). Other key uncertainties for
costs lie in the possibilities of the rapid short-term effects including,
or leading to, abrupt reductions in costs of low-carbon processes and products,
shifts towards low-emission technologies, and/or changes towards more sustainable
Q7.24 & Q7.31
|| Near-term action in mitigation and adaptation
would reduce risks. Because of the long time lags associated both
with the climate system (e.g., ~100 years for atmospheric CO2)
and with human response, near-term action in mitigation and adaptation would
reduce risks. Inertia in the interacting climate, ecological, and socio-economic
systems is a major reason why anticipatory adaptation and mitigation actions
Q5.19 & Q5.24
||Adaptation can complement mitigation in
a cost-effective strategy to reduce climate change risks; together they
can contribute to sustainable development objectives. Some future
paths that focus on the social, economic, and environmental elements of
sustainable development may result in lower greenhouse gas emissions than
other paths, so that the level of additional policies and measures required
for a particular level of stabilization and any associated costs can also
be lower. A key uncertainty is the lack of appropriate
knowledge on the interactions between climate change and other environmental
issues and the related socio-economic implications. A related issue is the
pace of change in integrating the main global conventions and protocols
associated with climate change (e.g., those involving world trade, transboundary
pollution, biodiversity, desertification, stratospheric ozone depletion,
health, and food security). It is also uncertain at which rate individual
countries will integrate sustainable development concepts into policy-making
Q1.9 & Q8.21-28
||Development paths that meet sustainable
development objectives may result in lower levels of greenhouse gas emissions.
Key choices about future development paths and the future of the climate
are being made now in both developed and developing countries. Information
is available to help decision makers evaluate benefits and costs from adaptation
and mitigation over a range of options and sustainable development pathways.
Anticipated adaptation could be much less costly than reactive adaptation.
Mitigation of climate change can reduce and postpone the impacts, lowering
the damages and giving human societies as well as animals and plants more
time to adapt.
Significant progress has been made in the TAR in
many aspects of the knowledge required to understand climate change and
the human response to it. However, there remain important areas
where further work is required, in particular:
- The detection and attribution of climate change
- The understanding and prediction of regional changes in climate and
- The quantification of climate change impacts at the global, regional,
and local levels
- The analysis of adaptation and mitigation activities
- The integration of all aspects of the climate change issue into strategies
for sustainable development
- Comprehensive and integrated investigations to support the judgment
as to what constitutes "dangerous anthropogenic interference with
the climate system."
WGI TAR SPM, WGII
TAR SPM, & WGIII TAR SPM