Climate Change

The earth's temperature has risen rapidly in the last 50 years. Is CO2 to blame? Yes, because CO2 has the motive, the fingerprints match, and it fits the description!

Motive: What I mean by motive is that CO2 wants to cause warming. As far back as the 19th century, scientists conducted experiments which showed the greenhouse effect. John Tyndall showed that certain gases allow sunlight to pass through down to earth, but trap the infrared radiation that leaves the earth. One of these gases was CO2. The Nobel laureate Svente Arrhenius was the first to estimate how much the earth would warm with increasing CO2. That was back in 1896. Since then, scientists calculated that Venus is 400 deg C warmer than it should be. The reason? CO2 makes up more than 96% of its atmosphere.

Fingerprints: All substances have a unique absorption and emission spectrum. You can identify an unknown gas in a test tube by measuring the bands of electromagnetic spectrum it absorbs. The absorption frequencies show up as dark lines on the spectrum and they work like a fingerprint. Between 1970 and 1997 satellites measured differences in the amount of radiation leaving earth. The 1997 measurements show large dips in energy at frequency bands that match CO2, CH4 (methane) and other greenhouse gases. This means that these gases trapped more heat in 1997 than in 1970. Measurements on earth looking at incoming (downward) radiation show increased energy in the same bands, confirming the effect and confirming which specific gases are responsible. This increase in energy cannot come from the sun because the sun emits at much higher frequencies. It is hard to refute this evidence, but a fair question to ask is whether some other mechanism is simultaneously causing the bulk of the heating.

Description (Size Match): The 0.8° C rise in temperature over the last 50 years might not seem like a lot. But it takes a huge amount of sustained heating to make the earth so much warmer. Something of the order of 36 ZJ (Zeta Joules) each year. Previously in earth's history when the climate warmed it was because of the sun. Either directly because of an increase in the sun's radiation energy, or indirectly because of a change in the earth's orbit. The earth's orbit changes over time, so does the tilt of the earth's angle, so does the orientation of that tilt (wobble). But we can rule these out completely. We've had satellites measuring the sun's radiation and it has been fairly constant over the last 50 years, with some tiny fluctuations that basically cancel each other out. The sun essentially has had zero contribution. Could it be volcanoes? Nope, those cool the earth. Secret magma pools heating the earth's oceans? Nope, the deep oceans are extremely cold. Could it be CO2? Yes, because the extra heat required for the 0.8 deg C matches what the extra CO2 in the atmosphere produces. It matches theoretically and it matches experimentally, i.e. from actual measurements on earth's surface.

The two fat tail risks that concern me are positive feedbacks and wars.

We know of several positive feedback loops which can cause exponential temperature growth. A single one of these could cause a tipping point. Here are some examples:

1) when Arctic ice melts, the dark waters absorb much more sunlight, heating the earth even more;

2) when the oceans warm a little bit, they release more water vapor which is a strong greenhouse gas in itself;

3) when a little bit of the permafrost/tundra melts, it releases huge amounts of CH4, a greenhouse gas 20 times as powerful as CO2.

Some of these are factored into climate models, some are not. The bottom line is that there is a possibility, albeit an unlikely one, that several positive feedbacks kick-in simultaneously to force a hothouse earth scenario. This could happen much sooner than average models suggest, i.e. the very essence of a fat-tail risk. It's dangerous because we are playing with huge amounts of energy. That 36 ZJ can melt all of the earth's ice in just 3 months! That includes all land ice: all of Antarctica and all of Greenland. Financial impact? I estimate it could be 50% of global GDP in the first year, about $45T. Luckily for us, most of that heat goes somewhere else right now (ocean water and radiation). But it wouldn't take a big shift to cause a catastrophe.

Some will say that there is nothing to worry about because there are negative feedbacks too, like various aerosols that shade the earth. Yes, these might play a larger role than anticipated. In a 100 years we might laugh and say there never was a climate crisis in the first place. I agree that this is a possibility. But in a discussion about insurance, a "good" outcome is totally irrelevant. It is like a home owner saying he won't insure his house against fire because there is a good chance that his house will never catch fire!

Wars are the other fat-tail risk. It is possible that early effects of climate change, like droughts or floods, might happen in the wrong place - think Bangladesh. This could displace huge populations. Migrations generally have a cascade effect and result in wars. Disruptions in food supply and water can also have similar chain reactions. Even if we never hit a tipping point in our lifetimes, there is a real probability of climate induced war. My guess is that you'll see bullets flying before you notice any increase in your A/C bill.

We should immediately buy insurance because the cost of that insurance is very reasonable.

The insurance has two phases. Phase 1: convert all coal power plants to MSRs (Molten Salt Reactors) which are clean, safe, consume radioactive waste from old reactors, and cannot be used to make weapons. (Note, these are different from SMRs= Small Modular Reactors which are also clean.) Phase 2: do a similar conversion for natural natural gas power plants.

I estimate that the total cost of replacing the 2,000 GW of installed coal power is around $9T, or roughly 10% of global GDP. This is fairly cheap if you consider that:

1) the cost would be spread over decades, so it would be less than 0.5% of GDP in any given year (as a comparison, consider that people often donate more than 0.5% of their income to charity);

2) MSRs don't need re-fueling, which makes their operating costs lower than coal plants - this means the real cost of these plants is much lower, perhaps 50% lower than the raw capital costs shown above;

3) thousands of people die every day from air pollution which comes mostly from coal fired plants. We can save all these lives "for free".

Other developments to watch include bulk battery technology (several based on molten salt, coincidentally) that could make renewable power more consistent. Modern room temperature super-conductors could give fusion a leg-up, although as always, fusion is 20 years away from being viable :-).

Most importantly, we should unleash human ingenuity by incentivizing entrepreneurs with carbon credits. We should tax carbon producers and give the money to those who produce clean energy. Let economics and human nature do the rest. The best solutions are probably still unknown, and we should let free markets accelerate their discovery.

Oh, and next time you're looking to buy real estate for your grandchildren, check the elevation ;-).

[Aside: why not solar? Despite my proud ownership of a 15.4kW system at home, I don't really think solar and renewables are all that compelling. For one thing, a typical panel only has an 8x return on its embedded energy. Then there is the disposal issue when they reach the end of their lifetime. There are also the environmental impacts: watch this Ted Talk.]