Note that everything below will be very simplified as the cost of carbon is not fixed in time, no one agrees on it, carbon is not the only greenhouse gas, etc. However, this should provide a decent estimate of the scale of the problem.
Estimated Cost Per Ton
There is no universally accepted cost for greenhouse gas emissions/carbon. Below are several estimates in USD of the social cost from presumably reputable groups:
Another way of estimating the cost that's less direct is to look at what countries have settled on as a reasonable carbon tax:
- France - $25/ton
- Denmark - $26/ton
- Finland - $60/ton
- Switzerland - $86/ton
- Sweden - $136/ton
- Canada - $38/ton (near future)
A third way of estimating the cost that's also less direct is to consider what energy companies think it will likely cost in the near future:
A fourth way of estimating it is to estimate how expensive it would be to remove from the atmosphere should we need to in the future:
- IPCC estimate for BECCS - $60 - $250/ton
- Stanford University estimate for direct removal/scrubbing - up to $1000/ton
How Much Do We Produce
Using an outdated (2010) source yields that the world produces ~43 billion tons of CO2 equivalent/year, and the US produces ~6.6 billion tons of CO2 equivalent/year. The World Bank puts those at 53 and 6.3 billion tons of CO2/equivalent/year in 2012.
How Much Have We Already Produced
The IPCC estimates that we had emitted ~1900 billion tons of CO2 equivalent by 2011. Assuming the world emitted somewhere around 45 billion tons/year since then based on the estimates in the section above, we get that we've emitted ~2100 billion tons of CO2 equivalent so far (end of 2016). I couldn't find a great estimate for the US, but this implies that it's ~480 billion tons of CO2 equivalent by 2010. Using 6.5 billion tons/year as the estimate since then, that leaves us with ~515 billion tons from the US.
Total Costs
Now we have enough information to calculate actual costs. I will ignore the fact that CO2 equivalent is made up of various greenhouses gases with different costs to keep this simple. Taking $25/ton as a low estimate from above, $100/ton as a mid-range estimate from above, and $220/ton as a high estimate from above, we can produce the following:
Note that I'm calculating these values by simply doing (output per year)*(estimated cost from above) and summing over all years. I used 45 billion tons/year for the world's reference and 6.5 billion tons/year for the US's reference. An interesting takeaway is that the US can effectively reduce our debt additions by ~$15 Trillion (using the medium estimate) over the next 50 years by cutting our greenhouse gas emissions by 3%/year each year. Note that this does not factor in inflation or the fact that carbon costs will increase as carbon increases, so these are massive underestimates of the actual costs 50 years from now.
Using the US's 6.5 billion tons/year with the medium estimate of $100/ton, that means that we are currently effectively borrowing ~$650 billion/year in greenhouse gas emissions. For comparison...that is the equivalent of ~34 NASA's, slightly more than 1 US mlitary, and almost twice as large as our reported deficit. Another way of thinking about it that this is the amount that we currently subsidize meat producers, oil producers, etc. None of these numbers are directly interchangeable of course, but it helps me get a sense of the scale at least.
Finally, here is a nice writeup from Reuters specifically on the cost of coal and here is another from Citi on global warming's economic impacts
'Borrowed' so far
| Low | Medium | High | |
|---|---|---|---|
| World | $52 Trillion | $210 Trillion | $460 Trillion |
| US | $13 Trillion | $52 Trillion | $113 Trillion |
Next 50 years (flat emissions)
| Low | Medium | High | |
|---|---|---|---|
| World | $56 Trillion | $230 Trillion | $500 Trillion |
| US | $8.1 Trillion | $33 Trillion | $71.5 Trillion |
Next 50 years (3% YOY reduction)
| Low | Medium | High | |
|---|---|---|---|
| World | $29 Trillion | $120 Trillion | $260 Trillion |
| US | $4.2 Trillion | $17 Trillion | $37 Trillion |
Note that I'm calculating these values by simply doing (output per year)*(estimated cost from above) and summing over all years. I used 45 billion tons/year for the world's reference and 6.5 billion tons/year for the US's reference. An interesting takeaway is that the US can effectively reduce our debt additions by ~$15 Trillion (using the medium estimate) over the next 50 years by cutting our greenhouse gas emissions by 3%/year each year. Note that this does not factor in inflation or the fact that carbon costs will increase as carbon increases, so these are massive underestimates of the actual costs 50 years from now.
Using the US's 6.5 billion tons/year with the medium estimate of $100/ton, that means that we are currently effectively borrowing ~$650 billion/year in greenhouse gas emissions. For comparison...that is the equivalent of ~34 NASA's, slightly more than 1 US mlitary, and almost twice as large as our reported deficit. Another way of thinking about it that this is the amount that we currently subsidize meat producers, oil producers, etc. None of these numbers are directly interchangeable of course, but it helps me get a sense of the scale at least.
Finally, here is a nice writeup from Reuters specifically on the cost of coal and here is another from Citi on global warming's economic impacts
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