The Impacts and Costs of Climate Change
There is growing recognition that mitigation policies or scenarios that are aimed at reducing
greenhouse gas emissions may have important ancillary benefits. These potentially include:
* Reductions in air pollution;
* Reductions in other environmental burdens;
* Increased security of energy supply (and/or energy diversity), including reduced oil imports;
* Improved competitiveness;
* Increase employment;
However, there have also been concerns that policies may lead to potential dis-benefits, including
* Impacts on trade and competitiveness (note this is also mentioned as a potential benefit above);
* Decreases in employment (again, this is also mentioned as a potential benefits above);
* Lifestyle changes;
* Security and proliferation with specific technology options (nuclear).
This section reviews review the potential ancillary benefit for each of these categories. In each case,
we have considered:
* The potential effects of the benefit;
* The possible approach to quantification and valuation of benefits;
* Where possible, the likely magnitude of the benefits (impacts and economic benefits).
Numerous studies have shown that air quality ancillary benefits of GHG mitigation may be a
significant benefit, offsetting a substantial proportion of mitigation costs. Whilst the full benefit of
greenhouse gas reductions resulting from further climate action may only be experienced by future
generations, the ancillary benefits of climate policy will accrue to the current generation.
The effects of air quality ancillary benefits will be quantified in the general equilibrium modelling,
GEME3, later in the study. A brief review has been made here.
A number of recent and emerging studies have assessed the potential ancillary effects of green house
gas mitigation policies (see Defra, 2002). The study found 20 estimates of the monetary value of
ancillary benefits from the literature. The table summarises location, pollutants and impacts that are
analysed by each study.
The estimates range from 1 to 13 Euro per tonne of CO2 reduced. The average ancillary benefit,
calculated from all studies presented in the table is approximately 27 Euro/tCO2 (Defra 2002). Some
care must be taken in comparing studies, due to the differences in methodology, analysis techniques
and damages included. Thirteen out twenty estimates of ancillary benefits from the literature are
below 20 Euro/tCO2 and studies concentrating purely on health impacts from a limited selection of
pollutants tend to report the lowest estimates. Studies considering a wider range of pollutants and
additional impacts such as materials damage, visibility and vegetation damage generally report higher
AEA Technology Environment, August 2005
Watkiss, Paul; Downing, Tom; Handley, Claire & Butterfield, Ruth. The Impacts and Costs of Climate Change. Oxford, England. UNT Digital Library. http://digital.library.unt.edu/ark:/67531/metadc29337/. Accessed July 25, 2014.