Thursday, June 15, 2006

Cost to Make the World Carbon Neutral

Interesting question raised over at Foreign Policy blog: What would it cost to make the entire world carbon neutral?

They determine the total amount of CO2 emitted from the DOE and then multiply it by the price of carbon offsetting determined by Green Tags. The 27.7 billion metric tons could be offset for $715.7 billion ($25.83 a metric ton).

To put this in perspective, it would be about 1.1% of the $60.7 trillion world GDP.

Is this number accurate? I decided to investigate a little more.

The first part I am not sure about is exactly how much CO2 needs to be removed in order to stabilize the climate. I have read that we need to reduce CO2 emissions by 50-70%. So, we might not need to remove all of it.

The second part I am not sure about is how much per ton it would cost. I took a look at the prices of some other carbon offseting schemes.

Green Tags cost $20 and offset 1,400lbs or $28.50 per ton. Carbon Fund does it for Just $5.50 per ton. Terrapass comes in at $10. In Europe:

Under the continent-wide trading system, the cost of a carbon credit reached a high of 30.5 euros for each metric ton, or about $39, last month. (In the last month, prices have dropped by half as many power plants reported much lower emissions than expected.)
Prices range from $5.50 to $39. That is a big range.

The advantage of the green tags (or any other offset or market system) is that they find the cheapest way to offset the carbon. But, that means that the more you offset the more expensive it is going to be. Currently they are paying solar powered electricity providers the difference between their costs and the cost of coal powered electricity. As you offset more, this option will fully utilized and you will need to pay for more expensive options like carbon sequestering.

How much would carbon sequestering cost?

PBS News Hour had an interview with Klaus Lackner about carbon sequestering and a device he has built to suck CO2 out of the air.
PAUL SOLMAN: The idea now is to scale the model up to the size of a football goalpost and suck carbon dioxide out of the air with a vengeance.

KLAUS LACKNER: Such a device could collect the CO-2 from 4,000 people or, alternatively, the CO-2 from 15,000 cars.

PAUL SOLMAN: Because greenhouse gases, once emitted, spread hither thither all over the globe, Lackner says his carbon-capture devices could be planted literally anywhere.

He claims 250,000 of these things worldwide -- admittedly, a huge number -- could neutralize all the carbon dioxide currently being emitted. Half a million could get carbon dioxide back down to pre-industrial levels in a matter of decades, he says. And, as the technology develops, the cost figures to go down.

KLAUS LACKNER: With off-the-shelf items we have right now, I can drive the cost of CO-2 capture from air below $100 per ton of CO-2. And I feel that, if you pursue this longer, the ultimate end game will be below $30 per ton of CO-2.

PAUL SOLMAN: That would be about 25 cents extra for a gallon of gas, says Lackner, but plenty of questions remain: how to cheaply get the CO-2 out of the sodium that's soaked it up; what to do with the CO-2 once you've isolated it.
You can see what his device would look like in the pictures, and more pictures are available at episode 3 on this page. More on his idea here and here.

Short term it looks like $100/ton for sequestering and $30 a ton in the future.

It's just too bad that nature couldn't come kind of device that would soak CO2 up from out of the atmosphere. Maybe something that was anywhere from 10ft-100ft tall, something green, pleasant on the eyes, offered shade, and gives the kids something to climb on. Imagine if we could have thousands of these right next to each other in a "forest" of CO2 sequestering devices. Too bad, guess we will have to build it our own man made version.

Putting this knowledge together, at the low end we need to remove 50% of 27.7 billion metric tons at $5.50 a ton or $76 billion. At the high end we have 27.7 billion tons at $100 a ton or $2.7 trillion. All and all I think the estimate of $750 billion is not to bad.

The other question then is, if you did have a spare $750 billion dollars, would this be the best use for it? The Copenhagen Consensus asked that very question, and it wasn't on their short list.

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