Money for Nothing

The EU's plan to reduce carbon emissions by 20% by 2020 will most likely cost at least €150 billion a year, yet it will postpone temperature increase due to global warming by just two years, from 2100 to 2102. For that money, we could provide clean drinking water, sanitation, education, and health care to everyone on the planet, while increasing CO2-reducing R&D ten-fold.

COPENHAGEN – When it comes to global warming, we have plenty of hot rhetoric but very little cool reason. This matters immensely, because the Kyoto Protocol is already among the most expensive global public policies ever enacted, and the follow-up in Copenhagen in late 2009 promises to break all records. We better get it right, but right now we’re more likely to pay for virtually nothing.

A good example is the European Union’s newly instituted policy of cutting CO2 emissions by 20% by 2020. Of course, it is always easier to promise than to deliver – a concern that is especially relevant in the EU. Yet, even if the promise is kept, will the benefit outweigh the cost? Curiously, but not surprisingly, this is not discussed very much.

A 20% reduction in the EU’s CO2 emissions, vigorously enforced throughout this century, would merely postpone temperature increases due to global warming by two years at the end of the century, from 2100 to 2102 – a negligible change. Yet the cost would be anything but negligible. The EU’s own estimate is about €60 billion annually , which is almost certainly a vast underestimate (its previous estimate was almost twice as much), since it requires the EU to make the reductions in the smartest way possible.

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