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Thematic Guide to Integrated Assessment Modeling
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Representing Policies
One of the basic jobs of integrated assessments is to assess potential response options. The classes of potential policy responses for climate change are abatement (reducing contributing emissions), adaptation (measures to reduce the losses associated with a changed climate), and geoengineering (altering the climate system to offset changes caused by increased emissions). Most attention has so far gone to abatement, less to adaptation, and still less to geoengineering. Integrated assessment projects may choose to represent any or all of these.
Abatement
To assess a proposed abatement policy, one seeks measures of its cost and effectiveness relative to an assumed economic and environmental baseline. There are two broad ways to represent abatement policies in an assessment, of which one requires that the assessment has sufficient technological detail, and the other that it has sufficient economic detail. With enough technological detail in the assessment, policies can be specified that require or regulate particular technologies or impose technical goals (say, a 35 mile-per-gallon automobile fleet or a specified efficiency of combined-cycle gas turbine generators), and their aggregate emission impact on the baseline can be summed. With enough economic detail, tax or subsidy policies can be imposed on the baseline and the effect on emissions observed after the consequent economy-wide adjustments.
Achieving a useful representation of either form of abatement policy is very difficult. With technological policy, it is hard to justify the particular technical goal assumed or to determine what actual policy levers could be pulled to bring it about or what their other economy-wide effects might be. With economic policy, an exceedingly detailed model is required to represent real policies as implemented, including the effect of all other policies in force that bear on the same decisions, rather than idealized policies such as a uniform carbon tax with lump-sum rebates. The challenge of realistically representing policies as implemented is even greater in the international arena. For example, most integrated assessment models assume that an international system of tradable emission permits results in equalization of marginal abatement costs in all participating nations, making the policy equivalent to a common carbon tax with lump-sum transfers. If an international system of tradable emission permits could be negotiated and implemented, it is surely unlikely that it would be this simple. In addition, further difficulties of representing the effects of abatement policy arise in the long term, concerned with the effect of particular abatement policies on investment in capital and research, and the rate and character of technological development and international transfer of technology.
Adaptation
Adaptation policies are substantially less well understood and their representation less well developed in assessment projects than abatement policies. In part this reflects the strong relationship between adaptation measures and the projection of impacts, which are themselves not well understood. This also reflects the fact that adaptation measures will be taken by a variety of actors, at levels from the individual to the international, and that policies affecting adaptation will include many measures not normally regarded as environmental policy: local zoning, infrastructure investment, insurance programs such as crop and flood insurance, regulations affecting inter-regional labor mobility, and many others.
Current assessment projects have used three approaches to represent adaptation. First, some level of adaptation can be assumed to be represented internally in impacts functions. By restricting adaptation to a particular level, this approach excludes the possibility of representing adaptation policies. Second, when sectoral impacts are studied at fine resolution, as in the MINK study (Missouri-Iowa-Nebraska-Kansas region), specific adaptive measures by individual and local actors can be identified (e.g., earlier planting) and specific policies identified to facilitate such adaptation by local actors (e.g., changed flow management in the Missouri). Third, in impact sectors where adaptation means large infrastructure investments, the optimal level and time-path of such investment decisions can be modeled in detail (e.g., Dutch studies on timing and rate of optimal dike-raising). While these approaches are a promising start, much more work is required to have an adequate understanding of adaptation processes.
Geoengineering
Geoengineering policy is in some respects simpler to represent in an assessment than either abatement or adaptation. All geoengineering measures proposed so far seek to alter certain simple parameters of the climate system, either the planetary albedo or solar constant (e.g., by orbiting mirrors in space or injecting sulfate aerosols into the stratosphere), or the rate of deep-ocean carbon sequestration (e.g., by fertilizing plankton in the polar oceans). The climatic effects of such measures can be represented simply, even in assessments that represent climate only as a globally averaged change in temperature or radiative forcing. Geoengineering policies are both promising and controversial. While it has been argued that they merit serious consideration because they may be cheaper than abatement or adaptation, their greatest value may be that they could be implemented faster than other responses and so could provide crisis response to extreme climatic events from the tail of the probability distribution. Such measures also pose deep problems of two kinds, though. First, unless implemented incrementally and reversibly, they may themselves carry large unanticipated environmental risks. Second, such intentional global interventions would pose deep problems of authority and legitimacy, of who has the resources and authority to carry out such massive interventions as seeding the oceans with iron filings or orbiting mylar mirrors in space, and who would bear the cost.
The next page is Incorporating Political Processes and Negotiation.
