by Jim Tolbert, Member, Business Climate Leaders
Originally appeared in LinkedIn
Climate models have uncertainty, and when you link these to economic models, the uncertainty only increases. Some people have argued that we should wait until we are sure about our future projections before we implement policies to shift away from fossil fuels and carbon dioxide emissions. This is like driving 80 mph through downtown, while speeding up and arguing that I believe there is uncertainty in my estimate that I will get hurt if my car hits another car, so I think I will wait a bit to touch the brakes until I can be absolutely certain I would get hurt if I didn't slow down - because I don't want to be late for my appointment.
Economist William Nordhaus has constantly contributed sound analysis to the discussion on climate change, challenging the discount rate used in the Stern Review. And he continues his contribution in a December 2016 Working Paper, "Projections and Uncertainties about Climate Change in an Era of Minimal Climate Policies." The reality is that most nations have postponed taking truly transformational policies to shift away from fossil fuels, and now the window for action has decreased and this causes the required policies to be more aggressive.
From Dr. Nordhaus' conclusion, "It is worth emphasizing one further point about the impact of uncertainty on policy. The future is highly uncertain for virtually all variables, particularly economic variables such as future emissions, damages, and the social cost of carbon. It might be tempting to conclude that nations should wait until the uncertainties are resolved, or at least until the fog has lifted a little. The present study finds the opposite result."
The time to act is now.