Beautiful Computer

For once, I feel my computer is beautiful and a pleasure to interact with.

Here are the key points:
1) Asus EEPC 1201N
1) Ubuntu (Linux) (originally dual boot, but now alone after windows became unnecessary)
2) Elegant Gnome
3) Croyde Bay from Baggy Point (my photo)
4) Project Hamster (provides a little box in the bottom right tracking and reminding me of what I'm doing)
5) Tomboy Notes (always on top - on the right - where I put the detailed schedule of what I'm doing)
I wish everyone else as much computer happiness as possible in the new year!!

Privatising Obligations

(Apologies for the slightly half-baked nature of this post; that's because I don't have the answers in this case: I need some help.)


I was having the general thought: if the financial system does not produce anything, but it does change behaviour (for example by providing liquidity/ready-cash for those who did not originally have access to such things), then it could be used as an analogy to try to solve collective action problems like climate change. The government could create an artificial world of contracts and options which changes behaviour without producing anything itself.

The general idea is that of concentration of power: if we can concentrate ownership of something, then we suddenly have a strong incentive to protect it.
(You can see here that I am trying to 'think out of the box' and I am not afraid of slaying some liberal/leftish/georgist sacred cows in the goal of better understanding, "to be go to hell for a heavenly cause")

The question I have is how do we concentrate ownership of something negative (the example I give here is legacy nuclear decommissioning liabilities)? How do we privatise an obligation that has unknown cost? If that could be achieved, then I think we could be closer to solving our collective action problem.

How Do We Privatise Legacy Nuclear Decomissioning Obligations?

The economic advantages of privatisation are well known. Privatised companies tend to be more efficient, and, since they are heavily regulated often better at solving environmental problems (witness the extremely healthy state of Britain's rivers and beaches compared to a few decades ago - this is partly due to the investment of the privatised utilities).

Now it seems easy to privatise something cash-positive -- a right to certain assets and/or an implicit right to the monopolistic power of a customer base. Often the rights to the assets and the customer base come with implicit obligations (e.g. environmental ones). So long as the liabilities are less onerous than the value of the rights (the assets), then the company is solvent and it is possible to privatise the obligations 'attached to' the rights.

Sometimes, however, it would be advantageous to privatise a pure obligation. Such is the case with the nuclear decomissioning obligation. The cost of this obligation is huge and the danger of it being in the public sector is that costs would overrun.

Some will say that private companies will not do a good job, but this is belied by the behaviour of the water companies for example. So long as clear regulatory standards are in place.

In any case it's not clear that we really need to decomission to such a high standard.

One way to privatise is to say: "we will pay X billion for the job: if you can do better, you can pocket the difference".

I'm not sure how you privatise an obligation: perhaps my readers will know the answer.

(This paragraph is a little incoherent, sorry again).
Why is this relevant to climate change? Well, if there was a collective action problem involving a benefit that accrued to the world only if everyone did some action, then a global government could set up options that pay in the event that the brilliant thing happened. A company could buy some of these options and then could persuade others to change behaviour by paying individuals to make that behaviour change. Unmatched derivative contracts designed by the government could help: it could even sell these at a benefit to the public purse. Even in this situation you have the 'natural tragedy of the commons' but that is counteracted by an 'artificial happy story of the commons'.

Difficult stuff. Anyone knows how to privatise an obligation let me know.

What does the data tell us about global warming?

"Prediction is very difficult, especially about the future", goes the old saying and perhaps we should add "especially about the climate". However, it's good to work out how well past predictions have fared.

Here's a comparison of Hansen's original 1988 predictions to outcome.
"And finally, let’s revisit the oldest GCM projection of all, Hansen et al (1988). The Scenario B in that paper is running a little high compared with the actual forcings growth (by about 10%), and the old GISS model had a climate sensitivity that was a little higher (4.2ºC for a doubling of CO2) than the current best estimate (~3ºC).

The explain that 'Scenario B' of Hansen's prediction has a temperature trend of 0.26 Celsius per decade, whereas the outcome is 0.19 Celsius per decade.
[...] Thus, it seems that the Hansen et al ‘B’ projection is likely running a little warm compared to the real world, but assuming (a little recklessly) that the 26 yr trend scales linearly with the sensitivity and the forcing, we could use this mismatch to estimate a sensitivity for the real world. That would give us 4.2/(0.26*0.9) * 0.19=~ 3.4 ºC. "
There's a bit more discussion of climate sensitivity here.

The model predictions are compared to the GISTEMP and HADCRUT global temperature series. There's a great project to make the GISTEMP computer code clearer here: Clear Climate Code . The minor coding errors don't seem to have affected the temperature trend. Some will claim that the temperature trend is somewhat an artefact of Urban Heat Island Effects.

However, we also have data from satellites, showing a temperature increase in the lower atmosphere (picking UAH the more conservative of the two estimates) of 0.16 Celsius per decade. (Here's the UAH data alone).

The final source of data showing the warming trend is the ocean heat content (expressed in sensible units by David Mackay) , which shows a strong upward trend. One interesting thing about this is in the period 2000-2010, where the air temperature has been static, the sea temperature has increased a lot. The heat capacity of water (and in aggregate, the oceans) is very much greater than air, so we've actually had plenty of global warming of the oceans in the last few years.
He notes that the warming of the top 700m of  oceans over the last 40 years averages about 0.45W/m2 over just the oceans. The estimated extra heat over that period is shown in this graph. This data suggests that the observed increase in heat flow is roughly two thirds of what our models suggest it should be. Therefore either estimates of fast feedback are slightly too high, or aerosol effects are larger than we expect.

In conclusion, the data suggests that global warming is happening; that models predict approximately the correct magnitude. My take on the data would be that they suggest a 'fast'/Charney climate sensitivity in the range 2-3 Celsius per doubling of CO2 concentration (to be clear, observations on ocean heat suggests towards the lower end of this range, but only if aerosols have had a relatively small effect). However, this does not include so-called slow feedbacks, such as Carbon Cycle and warming-induced Methane releases which may be significant, and therefore justify a larger range (perhaps 2-6 Celsius) for climate sensitivity.

In short, the evidence suggests that climate change is happening, that the warming is about as much as the IPCC consensus suggests, and that action is needed to not build any more greenhouse gas emitting infrastructure.

Nuclear Safety

I remember going to the Centre for Alternative Technology a year or so ago. There was a display about energy technologies.Energy technologies were assessed according to diffferent criteria from green (meaning good) through amber and red (bad) to black (very bad). Nuclear energy scored quite highly on all the criteria except one: risk where it got black (very bad).

Now of course risks from nuclear energy are of various types, including risks that are quite well specified because we have good knowledge of them. I'll split the safety issues in two: those associated with the direct design of the reactor and operation under normal circumstances and those through other matters. Here I will deal with only the risks of the direct operation of the reactor.

I am surprised at how little design features of nuclear reactors are discussed. Unlike the Soviet RBMK design used at Chernobyl, nuclear reactors built in the West over the last four decades typically enjoy a 'negative void coefficient', meaning that power would fall in the event of a void in the coolant, due for example, to a loss of pressure, a negative feedback loop which leads to the reactor shutting down. Some new reactor designs (e.g. the Westinghouse AP 1000) also employ 'passive safety' features, meaning that failure of safety systems leads to reactor shut-down through 'passive' processes such as gravity, rather than relying on the defence-in-depth of multiple parallel safety systems. Redundantly, Western nuclear power stations are also typically built with a concrete containment dome.

So in this case, nuclear reactors have a very low risk. How low? Well risk assessment can only by definition assess those risks that can be assesed, but nuclear reactor designs should blow up only one in every 10 million reactor-years, and even then they should be fully contained. So there is a 1/10000000 chance of a contained nuclear reactor accident. This appears absurdly low: even if the world built 1000 nuclear reactors, we would only expect a contained accident every 10,000 years or so. If only climate change had such low risks of catastrophic outcomes!

Of course there may be other risks and environmental damages associated with nuclear power, and I'll try to deal with all these some other time.

I have also been thinking about the banking system and wondering if similar design features should be applied to it! Can we get 'passive safety' into the financial system. Might be worth a try!

A solution to climate change within three decades?

Syndicated from

Tackling climate change would cost the UK £1 trillion so why should politicians sign up? My friend Stephen Stretton’s new think tank might have the answer. Stephen spoke to me about cutting carbon dioxide emissions close to zero and convincing climate skeptics.

Full article here

Decisions Under Uncertainty

I found the following diagram from Mike Hulme's book interesting. It describes different ways of describing the risks from climate change (note the empowering nature of the national security frame).

Climate Change Frame
Audience Engaged
Scientific Uncertainty Frame
Those who don't want to change
National Security Frame
As above, but now inspired to act
Polar Bear Frame
Wildlife lovers
Money Frame
Politicians and the private sector
Catastrophe Frame
Those who are worried about the future
Justice and Equity Frame
Those with strong ethical leanings

Peter Dawe's comment that an entrepreneur is someone who makes decisions before knowing all the facts. I think we probably need more of an entrepreneurial attitude on this.

Source: Hulme (2009) 'Why we disagree about climate change: understanding controversy, inaction and opportunity', CUP (quoting Shanahan (2007) see )

A Simple Macroeconomic View

Here's this from the Aleph blog, three years ago:
"Sometimes I think that the Keynesian and Austrian Schools of economic thought can be merged into a consistent synthesis that would disagree about the goals of policy, but largely agree on how economies work. One of the men that would help promote such an idea would be Hymen Minsky."
Here's an attempt to do just that:

1) Prices are sticky and markets (e.g. for labour) don't always clear; there is 'involuntary unemployment'. (Keynes) -- [Evidence? For example, graph of unemployment (x-axis) against inflation (y axis) 1990-2010 is approximately horizontal - ie big changes in unemployment without changes in inflation. the following graph is from Austalia]

2) Fractional reserve banking adds a second class (bank deposits) of money to the first (banknotes issued by the central bank). The second class of money, bank account money is usually created at the same time as debt, causing asset price inflation (Austrians); and deflation (Fisher) when the the two are cancelled out when de-leveraging.
3) Conventional economic thinking tends to ignore asset prices. But increases in credit money lead to increase in asset prices, and these lead to wealth effects which may add to economic instability.

To put it simply, markets (as currently constituted) don't always work, that's why you need a Keynesian response in a 'great depression' scenario. Some of the reasons that markets as currently constituted don't work may be 'Austrian' (ie the markets are distorted by the existence of fractional reserve banking), but the 'Austrian' message tends to be distorted as 'make markets freer, but ignore the privileges of the financial sector and the asset-owning sector', when these sectors are probably the most important distortions. However, there may be other reasons that 'markets don't work' apart from the 'Austrian' ones.

QE2 - Just Print Money

Why did I change from being a fiscal dove in 2008, asking for deficit spending, to being a fiscal hawk in 2010, arguing that UK needed to drastically reduce its deficit? One reason was the dramatic success of unconventional monetary policy or quantitative easing (QE). Printing money and pumping money into the economy seemed to inflate asset prices, making people feel richer and bringing the UK out of the recession.

The success of QE leads to two conclusions: firstly, fiscal policy need not take all of the load; secondly, it's very bad practice to finance deficits indefinitely with printing money, so if you are using QE, you should get the deficit down sharpish.

I agree broadly with the scale of the UK fiscal tightening (however I would have done it more with tax rises, and with wage cuts: I think the spending cuts may be somewhat unrealistic). But it seems inevitable that such as sustained tightening, copied elsewhere, may well lead the country back into recession. To argue otherwise is to base policy on hope rather than logical argument.

In order to prevent a double dip recession/depression I suggest:
a) create moderate inflation, through rises in indirect taxation such as VAT and carbon taxes
b) pre-emptively introduce further quantitative easing, so as to prevent a 'double dip' recession.

The bank of england needs to take account of the 'feedback' of fiscal tightening and act decisively to prevent a double-dip recession. In the future reserve requirements may need to be raised in order to mop up the money.

Peak Oil and Energy Technologies

(this is an old post that I hadn't yet published on this blog)

The Peak Oil thesis predicts that the rate of oil production will peak soon and start to decline, not keeping up with basic demand. However basic economics argues that in the event of a supply shortage, the price of oil would rise. The consequences of an increase in price are that the demand for oil would fall, and new forms of supply would be found.

Nevertheless, since both oil demand and oil supply are not particularly responsive to price, a peaking of conventional oil production could lead to quite severe price increases, with consequent economic effect.

Supply shortages are gaining credibility with articles like the one above. So perhaps the oil price is going to go much higher than expected.

However, in this case, the high oil price (even at current levels of over at over $50/barrel) would accelerate the technological development of oil shales, tar sands and even coal-to-liquids too.... All of these have even higher greenhouse gas emissions than oil. :(

Of course if oil/gas prices go high enough there might be a switch to electricity. But sadly again coal (for electricity) might benefit, since it is largely cheaper than cleaner alternatives. :(

Unfortunately there's no shortage of coal. Since China is the biggest growing market we may need a electricity technology that's cheaper than coal IN CHINA...

That's a hard task, but it may be the only way the world can be saved.

There are few technologies which are even close to being cheap enough.

Wind is cheap enough in certain positions, but it's intermittency makes it unattractive.

Concentrated solar energy has been argued to be potentially economic with conventional ways of producing electricity. Yet it is suitable only in equatorial regions with large areas of deserts. There is unlikely to be enough space in Eastern china, and unlikely to be enough water in western china.

It is a similar story with Carbon Capture and Storage (CCS) Technology. Noone is doing CCS on a large scale yet either (a large-scale pilot by BP in Peterhead was recently abandoned due to lack of government support). If you have optimistic assumptions about altruism (i.e. that countries will pay extra to save the planet) then this is a a crucial technology too.

Nuclear is generally more expensive than coal, but it is not inherently so. Given the severity and all-encompassing nature of climate change impacts, it might be risk-efficient to eliminate some safety systems/shielding on nuclear reactors, reducing the cost below coal. The benefit of carbon emissions would outweigh the slightly-increased risk.

However, now we may not have to make such a difficult choice. Modern reactors such as the AP1000 have passively safe modular designs which are safe without expensive backup multiple safety systems. But we're not yet building these types of reactor on a large enough scale for them to be really cheap. Perhaps we should.

Back to Basics

In the clamour of contention and controversy surrounding the climate change debate, sometimes it makes sense to return to first principles. I was reminded of this sharply during a conversation with a professor of solar energy technology, when he stated bluntly that speculation on solutions is worthless unless we have come up with a concise definition of the problem we are trying to solve. I hope in this initial column to humbly attempt to lay out the problem we face with the hope of looking at possible solutions, and the debates surrounding them, in later columns.
Full Article Here

My New Column for the International Business Times

I've just started a new column for the Green Investing section of the Online newspaper the International Business Times.

My first column was published about a week ago here.

I've now rewritten the article with a friend, so I can post it onto this blog next.

Check out for more news and comment!


"For those who want some proof that physicists are human, the proof is in the idiocy of all the different units which they use for measuring energy." Richard Feynman, The Character of Physical Law

Discussion of energy is bedevilled by by units problems. The impass is not only the use of non-metric units, it is also the use of different time units (seconds, hours, days or years). The discussion can perhaps only be resolved by sometimes using dual units: one strictly SI (with seconds as the time units) and another in familiar units, using years.

The Case for Carbon Taxes in the UK

Britain now has a new Liberal-Conservative coalition government, determined to tackle the huge British government budget deficit (at 12% of GDP in 2009/10, the highest since the second world war). The new chancellor, George Osborne, and his deputy, David Laws, will set out their initial plans for spending cuts shortly, and will lay out a new budget by late June. This 'emergency budget' will presumably also include plans for taxation increases. Many commentators believe that a rise in Value Added Tax (VAT) is both justified and likely. An alternative to a VAT rise is to impose a Carbon Tax. A carbon tax sets a fixed price on fossil fuel use, based on the carbon content of the fuel, and therefore is proportional to the final emissions of carbon dioxide produced. Not only could such a tax raise significant amounts of revenue, it would provide the incentives needed to meet ambitious targets for reducing greenhouse gas emissions by 2020, set out in the manifestos of both governing parties. Furthermore, a carbon tax could both stimulate and re-balance the economy away from increasingly costly fossil fuel imports and towards immediate investment in energy efficiency and low-carbon energy infrastructure. It can be argued that carbon taxes are currently well suited to the circumstances faced by the UK and other similar countries.

Carbon taxes are arguably the most important part of a package of measures needed to finance the replacement of an energy system currently dominated by fossil fuels. During the global economic crisis, many called for a 'green new deal', financed by government deficit spending. After the recession, our priorities are rather different. Massive government deficits and growing national debt limit the capacity for discretionary government spending financed by borrowing. When faced with large indebtedness, maintaining economic growth seems essential to reduce the burden of that debt. How can we both stimulate the economy and cut the deficit?

Maybe we need a stimulus promoted not by government spending, but rather encouraged by the government's ability to provide security and stability for investment in vital infrastructure. In the energy sector, the government can provide the stability that investors will achieve an adequate return on their investment in new low carbon electricity generation infrastructure, for example. This means that the government should provide confidence that the carbon price will be maintained.

What specific types of carbon taxes could be imposed? This depends in part on what is there already. As can be seen from the following table, there are a bewildering variety of different taxes in different sectors, managed by different departments, and at different tax rates. However, a few general statements can be made. Taxation on energy is highest in the road transport sector (when taxes amount to equivalent of over £500/tCO2) and lowest on air transport, domestic heating, and net-imports, where carbon or energy taxes are minimal. Amongst the other sectors, there is already a small carbon tax of £20/tCO2, once the european emissions trading scheme is added to the climate change levy and other fees and charges existing at the national level.>

Deciding on an approach for all sectors requires the application of a number of principles, some of which will be outlined here. Firstly, we need to determine the target carbon price. I would argue for a carbon price of around £100/tCO2, since this is the approximately the price needed to stimulate large-scale alternatives to fossil fuel. Secondly, the carbon tax should simplify the existing taxation system. Thirdly, the tax should where possible leave British industry in an equivalent, or more competitive position. Fourthly, the change should in the short term make consumers no worse off, and in the medium term, it should protect the most needy

From these principles we could suggest a number of possible alternatives. The first is a single, across-the-board carbon tax. This is the simplest and most clear. The main concern for this tax would be an impact on competitiveness on energy-intensive sectors. Such impacts are surprisingly limited, as in Britain's case the sectors that are most energy-intensive are not those that are particularly export-intensive. Energy is a surprisingly small proportion of costs for most businesses. However, there would remain some effects in the coal & steel and chemicals sectors, for example. Special measures, such as refunds, could be imposed in these sectors. A more elegant solution would be a system of border tax adjustments, which would probably have to be imposed at the EU level. A ubiquitous, cross-sectoral, carbon tax could be safely introduced at a low level of around £10-20/tCO2, across all sectors apart from imports , and replacing the climate change levy. Other less-ambitious approaches could include replacing and rationalizing the climate change levy, and/or a residential carbon tax, refunded initially according to historical usage, with the refund being taken away over time, although retained for the elderly.

Instead of a VAT rise, the government should consider imposing a carbon tax in one, many, or all of the energy-consuming sectors of the UK economy, and guarantee that this rate will be at least maintained for the lifetime of new infrastructure.


Problems Solved

  • Reduce budget deficit (12% of GDP in 2009/10).
  • Reach the challenging emissions targets for 2020 (34% by 2020 (Conservative) or 40% by 2020 (Liberal Democrats)).
  • Reform and simplify the tax system, including the climate change levy.
  • Provide a level playing field for low carbon investments by putting a minimum price on carbon. Let the market decide, rather than the government 'picking winners'.
  • Provide an economic stimulus by encouraging economic agents to bring forward expenditure on energy service, substituting current investment spending on energy efficiency for future spending on fuel use, creating real assets, and increasing net national wealth.
  • Rebalance the UK economy to reduce imports and improve balance of trade.

Existing Measures By Sector

No. Sector                 Schemes            C-Price  Emissions-as-%-of-uk
1 Electricity/Domestic ets red-vat fit ro £10/tCO2 (15%)
2 Electricity/Commercial ets ccl ro £20 (15%)
3 Electricity/Industrial ets ccl ro £20 (10%)
4 Gas/Domestic red-vat £0 (10%)
5 Gas/Commercial cert £10 (5%)
6 Gas/Industrial ets £10 (5%)
7 Oil/Road Transport rtd roadtax £500* (20%)
8 Oil/Air Transport lc £20 (5%)
9 Oil-Coal/Commercial ccl £10 (trace)
10 Oil-Coal/Industry ets ccl £20 (5%)
11 Oil-Coal/Domestic duty £? (trace)
12 Agriculure & Waste - (10%)
13 Embodied carbon in Imports - (additional ~+70%)
14 UK contribution to intl air transport (additional ~+5%)
15 UK contribution to intl shipping (additional ~+5%)

Possible Sectoral Approaches

  • Domestic refunded carbon tax 1&4 red_vat increaser neutral
  • Small industrial/commercial carbon tax (ccl levy replacement) 2 3 5 6 9 10
  • Large Industrial/commmercial Electricity carbon tax refunded in energy terms. (R.O. replacement) 1 2 3 neutral
  • Carbon Import tarriff (eu level)

National Unity Government Needed

It's admitedly an exaggeration to say that the UK is only a failed bond auction and a couple of breaths of the animal spirits away from a death-spiral. But its not much of an exaggeration - we are way, way, too close for comfort. We need a massive shift in the government's fiscal position, while not making the recession worse. In the election it seemed that none of the parties could face being honest with the electorate -- to make vividly real, what they proposed in order to improve the public finances. So now, they should all get together to implement the nasty medicine:
  • Across-the-board 10% cut in all public sector workers' salaries -- with a 20% cut for MPs.
  • Increase in consumption taxes, specifically a GBP100/tCO2 carbon tax.
  • Simplify the income tax system with a flat rate of (say) 40%, with no income below (say) 10,000 taxed.
That lot wouldn't be popular - indeed it would bring people onto the streets.
Britain last faced this sort of deficit in wartime. We need a national government to sort it out. There should be a coalition of all the main parties for the 5 years needed to sort this out.

Election Day

Well, we're in the middle of election day here in the UK. Obviously the big issue is how the government will tackle the deficit, amounting to about 12% of GDP; one pound in every four the government spends is borrowed. Tackling the deficit will require both spending cuts and taxation rises.

So which party is best?? They are all about the same as far as I can see. They all commit to tackling the deficit but none tell us how they will do it. Everyone agrees on notional, massive, spending cuts, but none provide enough of the hard detail.
Some people have asked me how I think they should vote. None of the parties is telling the truth, so why vote for any of them. I think we need a churchillian party that is willing to say, "All I offer is blood, sweat and tears" -- tax rises in other words.

On the other hand, there's no point in pushing the economy back into recession, which could cause a greek-style collapse. What we need, therefore, is tax rises that stimulate the economy, and push forward the new low carbon economy at the same time. Can't be done??? Well, it may just be possible. More on that another time.

But who should I vote for? Well, you can vote for a candidate not a party. Look for the best local candidates.

Vote for honesty or not at all.

How Should the US Legislate on Climate Policy?

The passing of legislation in the United States congress is crucial to reducing greenhouse gases globally, for two reasons. Firstly, the US is significant in its own right, as the second-largest global emitter of greenhouse gases. Secondly, as the richest and most powerful country in the world, many other countries wait for the lead offered by the US, and the US will have a great influence on the structure of future agreements.

This short post set out in outline what I think the US should do to reduce greenhouse gas emissions.

First, scrap the Kyoto system. In the Copenhagen negotiations the US argued in favour of the replacement of the Kyoto protocol. There are good reasons for scrapping Kyoto with its distinction between developed and developing countries, and its extensive use of 'flexible mechanisms'. I have outlined the problems with Kyoto in an earlier paper.

Secondly, introduce an upstream approach. Rather than measure the CO2 emitted by companies and individuals at point of emission ('downstream'), it's easier to measure how much carbon is extracted or imported into the country and levy the tax there. The economic incidence of the tax will be broadly the same wherever in the chain you implement it.

Thirdly, have a broad tax base for the proposals. Any carbon price/tax should include all emissions, not just some sectors. An upstream approach that taxes the carbon at source(see previous section) should catch almost all CO2 emissions. The carbon tax should include petroleum for transportation and natural gas for home heating - all fossil fuels in short.

Fourth, adopt a consumption basis for the carbon price/tax rather than a production basis. This means that taxes should in principle be levied on imports of goods from any other countries that do not have comprehensive plans to reduce greenhouse gas emissions. This means using border tax adjustments. This can be implemented by value according to the emissions intensity of the original relevant country-sector.

Fifth, reverse the direction of political realism: structure climate policy so that it is more politically acceptable the more stringent it is. Ways to achieve this might include a sectoral approach for negotiating the transitional measures to adapt to a high carbon price; and 'transformative contracts' for existing high-carbon interests (for example giving guaranteed electricity prices for solar power produced by fossil fuel companies), with 'frontloading' of subsidy and 'backloading' of costs (recognizing that political actors have a relatively short time horizon / high discount rates).

Sixth, ensure a carbon/tax price that is high enough to encourage clean fossil fuels with Carbon Capture and Storage and Concentrated Solar power, to provide scalable energy sources for the future (and possibly Air Capture of CO2 from thin air). This price would need to be at least $200/tCO2 over the next decade. Implementing carbon capture and storage with an upstream carbon tax approach requires implementing subsidies for verified carbon storage (a small proportion of which could be held in escrow pending long-term verification of carbon storage).

Implementing the preceding points may be more straightforward with a carbon tax than an emissions trading scheme. Furthermore, an international system of harmonized taxes has only one degree of freedom - the tax level - meaning that international negotiations may well be simpler when based around a common carbon tax level than level of emissions reductions. Furthermore, such an international club could be created from the 'bottom up', by agreements between the United States, Europe and Japan, and other OECD members.

Whilst in principle it is possible to adopt cap-and-trade scheme with most of the previous features, it would be very different from those adopted so far, for example the EU (in particular it would need to be upstream with a complete tax base, and a much higher carbon price). To keep things simple, therefore, my advice would therefore be to adopt a carbon tax of around $200/tCO2, with revenues rebated in the short term (1-5 years) to reduce taxes on domestic companies, and individuals and to reward resource owners for keeping carbon in the ground (so that major political actors are no worse off). In the long term (>~3 years) revenues should be used to reduce the fiscal deficit.

The carbon tax could be managed by a central agency in order to meet emissions targets, rather like a central bank sets interest rates in order to meet inflation targets. The price level would only need to be changed infrequently - every year or two - however, in order to ensure that the targets are at least met.

A Risky Business

I was talking about risk last night with a couple of friends. I was asked why climate change is a risk to individuals, nations and the world. Here's why. The following distribution describes the estimated chance of different warmings if we give up producing CO2 and other greenhouse gases now (actually if we stopped in 2005). You will see that we have a more than evens chance already of melting the greenland ice sheet (7m of sea level rise, enough to reach the shores of Cambridge). Over the next few years we will reach the same chance of destroying the amazon rain forest (it's even possible that if climate change was compounded by drought, a vast fire might erupt). Big risks.


The commentary "Stop Worrying Start Panicking?" on this is here:

The other thing I've been thinking about is the basic evidence about why the planet is cooking (in particular, how we determine the radiative forcing of different gases). I've found this article which appears quite good:

Designing a Book in Open Office

I've been searching for some tools to help me write a book. The word processing tool I intend to use is Open Office, which I find much more elegant and clean when it comes to the use of styles.

Using Open Office, I've been searching the web for tools to improve the design and give hints on writing a book in OO. Here is my list of links:

Overall this is the best link:

A basic tutorial on Open Office is Available here:
Further resources on taming OO are here:

A general guide to writing a book is available here:

There are two ways to write a book: as a single file or as a master document. For information about the single file method see here:

Interestingly, the other Open Office apps have styles too:

Information on graphic design and pagelayout is on Wikipedia here: and

I also use Zotero for references, which I'm finding very helpful. Go here


I've downloaded all the templates but I'm not that impressed by the graphical design.
The 'Advanced book template' has space for notes.

One template with active development is here:
This is intended for novelists, but has a lot of detailed help, including styles to create notes that won't be part of the final book. There is even a google group