Cooperating by Competing Cooperation

Well what we should do to limit fossil fuel consumption??? What we should do is what humans usually do, namely 'cooperate by competing'. Cooperating by competing is the whole basis of Adam Smith's economics. I'm not suggesting the competition is individual capitalism. Rather the competition is over the rents associated with fossil fuels.

Let me explain. Fossil fuels are limited by how much is in the ground, but even more, they are limited by the desire to have a safe, non-hothouse Earth. If we want to preserve the natural world and the environment that we have grown used to, we need to limit the amount of fossil fuels that we dig up and burn. Any limitation has a 'scarcity rent' associated with it. Who charges the scarcity rent is up to us.

So the UNFCCC should give its official blessing to set up two cartels; a cartel of the fossil fuel producers, which would limit the amount of fossil fuels dug up, and a cartel of the fossil fuel consumers, which would limit the amount of fossil fuels burnt. Rental income from both cartels would be returned to the producers and consumers of the fossil fuels respectively.

What Would I Do? Thoughts on Copenhagen Negotiations

With 40 days to go and counting, it will not have escaped the readers of this blog's notice that are some climate change negotiations coming up, related to the end-of-year conference in Copenhagen. This blog post tries to ask what could be achieved in an 'ideal world' at Copenhagen. What are the objectives of global negotiations? What are we trying to achieve? What are the political constraints that we have to deal with?

In a separate blog post I discuss one possible ways of solving the climate change problem. Here I merely describe what I personally would think would be a good outcome of Copenhagen.

It seems likely that targets will be a major part of the outcome. What use are targets? Well they suggest what nations promise to do in the future. But unless they are enforced, they are pretty useless.

Institutions, Measurement and Enforcement
A better outcome than targets would be institution(s) with teeth.

What is an institution? Well the OED defines Institution (6th definition) thus:
An established law, custom, usage, practice, organization, or other element in the political or social life of a people; a regulative principle or convention subservient to the needs of an organized community or the general ends of civilization.
So we need some of those, at the global level!! At the moment we have some institutions already: the International Panel on Climate Change (IPCC) - which does the science - and the UN Framework Convention on Climate Change (UNFCCC) - which organizes these Conferences of the Parties (COPs). But it would be nice to get an institution with teeth.

What would an institution with teeth look like? Maybe like the World Trade Organization. The WTO appears to annoy a lot of people which perhaps means that it does something.

Why do we need institutions? Well, one reason is that we need enforcement. If people don't do what they said that they would do, then they need some sort of serious redress. Enforcement could take the form of financial penalties for example. Related to enforcement is the issue of measurement - we need to know what an outcome has been before we can enforce it.

Equal Rights or Nobody Worse Off?

When we constrain pollution using market instruments such as taxes, the revenue generated to the central authority can have many purposes. The changes in relative prices can also affect the value of assets - for example, houses or coal power stations, and change the relative costs of entrenched ways of behaving -e.g. entrenched commuting patterns.

There are a few possible principles that we might use to allocate the revenues, in the case that they do not go into general taxation. (We are only considering principles here):
  1. "Revenues are the equal right of all"
  2. "Make nobody worse off"
  3. Give revenues to the rich and powerful
  4. Give revenues to the poor
The first principle has been argued for extensively. The third and fourth principles have been used often. The second principle has not been used very often and is often neglected.

It should be noted that principles one and two are in conflict. If we give pollution rights equally, this will make some people better off and some people worse off. However, if we make sure that nobody is worse off, we may not make a change that respects 'equal rights'.

It is an interesting question which of these principles is best; and one which I will return to in future. I lay open the possibility that one of the reasons that many people resist environmental taxation is that principle two is not respected.

Evidence for Climate Change and Related Policy Issues

To get back to the purpose of this blog, I thought I'd do some work outlining some of the evidence for climate change and the policy issues.

Science Issues

Why do we think that the observed increased concentrations of CO2 and Methane will warm the earth?
1) Basic physics
2) Water vapour feedbacks from recent measurement of radiative outflow from satellites & Models integrating these observations
3) Observations of the climate warming up already (see below for detailed refs)
4) Observations CO2 of the ice ages (showing evidence for positive feedback as well as a very close link between temperature and CO2 and Methane)

Concentrations of CO2
Concentrations of CO2 went between 180 (ice age) and 280ppm (warm period between ice age). They are now at 388ppm: higher than the last few million years; the sun is also getting stronger over the very long term.

Science of Greenhouse Effect
  • Basic Physics: see this BBC site
  • Undergraduate level Physics: see Archer

  • Greenhouse gases increase the flow of energy into the Earth. It has been estimated that a concentration of CO2 of 550 parts per million (before industrialization the level was 275 parts per million) would leave to 3.7 Watts extra heat imput per square metre of the Earth's surface area.

    Water vapour
    The Stefan Boltzmann law would shows that the heat radiated from the earth's surface increases by about 3.2 Watts per square metre per degree Celsius rise in temperature. Therefore, the Earth's temperature would need to rise by about 1.2 degrees Celsius to balance out this rise in temperature.

    However, we know that warmer air has a higher absolute level of humidity (in otherwords it contains more water vapour). Water vapour is also a greenhouse gas, and so this traps heat too.

    We can estimate that water gives a positive feedack of -1.6 Watts per square metre per degree Celsius rise in temperature.

    This should be compared to 'StefanBoltzmann' extra heat flow of 3.2W/m2K, giving net effect of 1.6W/m2K

    When we include this effect (but assume no other feedbacks), that means that the earth would have to rise in temperature by 2.3 Celsius (not 1.2 Celsius) before the outflow of heat balanced the extra inflow.

    So CO2 drives temperature, that increases humidity, and that leads to the water vapour feedback, which can be observed. See this article.

    All the evidence is put together with computer models, but we don't really need computer models to estimate these issues, we can work it out ourselves from science and observations

    Evidence of warming
    Specific Fingerprints
    Observed Impacts

    Very many different observations around the world e.g. temperature measurements, rate of glacier melt, species shifts, Artic sea ice, sea surface temperatures, coral reef bleaching, heat waves:

    Most of these show some evidence of climate change. People will I'm sure, come to their own conclusions.


    There are some arguments about climate change by self-styled 'sceptics'. Here is an explanation of the more complex issues.

    Policy Issues

    Uncertainty & Risk?
    Of course, there is always discussion and debate, but the fact that there are big risks shouldn't blind us to doing something to secure ourselves against those risks.

    We know that the earth responds to a lag to our behaviours. We already have seen serious effects to climate change (see 'evidence of warming' elsewhere in this reply) and the rate of increase of greenhouse gas concentrations is itself accelerating (think of putting the foot down when you see a road traffic accident). Don't you think it might be good to be a little bit safe rather than sorry?

    Kyoto Ineffective??
    We need a much stronger treaty that doesn't only include global targets, but also coordinated taxes.

    It has been estimated that the investment required to decarbonize the UK is around £600bn (which would spent mostly on UK resources). The UK consumes 1.7million barrels of oil per day or 620 million barrels per year, with a value (at $80/bbl) of $50billion (£30billion).
    We use 91.1 billion cubic metres of gas per year present, worth £11billion (at 35p per therm or 13p/cu m). So we spend more than £40bn per year on fossil fuels; replacing this with renewable and nuclear infrastructure could get a return on our investment of 15 years. Not bad.

    Good, strong, climate policies could increase investment in real infrastructure, providing jobs, and making us less dependent on foreign oil! Hurrah!

    How To Avoid Getting Distracted

    Distraction is the bane of modern life. There are main two sources of distraction - internet and email - plus you can simply forget what you are supposed to be doing. Here are some technological suggestions to avoid getting distracted:

    • Pull out the cable / disconnect the Wifi.
    • Block certain websites (i.e. facebook) during work hours. If you use Firefox, an addin called "self control" may do the trick.
    • Work offline.
    • Disable notifications.
    • Clear emails only once a day.
    • For the time when you need to send an email: create a 'sending mail' link, with a shortcut referring to "mailto:" (the bit inside the quotes). This will open your email sending application without checking for new mail. You can put this shortcut on the desktop, start menu and/or 'quick launch' bar.
    • For the time when you need to find an email, use google desktop to index your gmail or outlook emails (I don't usually use the rest of the desktop search functionality, so I just search my gmail; this also works for outlook).
    • Avoid difficult, intellectual, or contraversial discussions that use email - at all times, and especially during work hours. There is a role for such discussions - mostly to construct something of value - i.e. they should aim for publication in a peer reviewed journal, newspaper, or website. Face-to-face discussions may also be useful.
    • is a website that prevents multitasking/distraction by telling you exactly what to do next. It can be integrated into your desktop using the 'active desktop' functionality; or it can be added as a sidebar to your (e.g. firefox) browser.