China’s Climate Policy Could Offset Costs By 2030

A new study by MIT, titled “Air quality co-benefits of carbon pricing in China” reports that if China follows through its climate change policy and adheres to meeting its CO₂ reduction goals then the monetary savings incurred from better air quality and health would exceed  the cost of implementing the climate change policy by 2030.

The study estimates that if China meets its gas-reduction goals, not only would it improve its air quality but it would also avoid significant amount of premature deaths in each province. The fewer deaths due to pollution produces a specific benefit to society, estimated at $339 billion dollars in savings by 2030 which is four times the cost invested in reducing emissions.

Selin and Valerie Karplus led the MIT team, which included a mix of economists and atmospheric scientists. They wanted to look at how a national policy meant for global climate would benefit China’s local air quality and public health. Even though many researchers have previously explored the “co-benefits” (health and air-quality) of climate change policy. This is the first time a study is conducted to see how the “co-benefits” would affect the policy’s stringency.

“Air pollution is an immediate problem that is directly linked to many of the economic, energy-related activities that are also responsible for greenhouse gases. We wanted to understand to what extent you could address air quality by targeting carbon dioxide through a representative climate policy, carbon pricing.” Karplus said in a statement.

The team developed the Regional Emissions Air Quality Climate and Health (REACH) framework, a modeling approach that combined an energy economic model called the China Regional Model (C-REM) with an atmospheric chemistry model (GEOS-Chem).

C-REM modeled China’s economy and energy system at a provisional level. The researchers then used the model to stimulate how a given policy would change the provinces economic activity, energy use, emissions of CO₂ and other pollutants.

The team ran four simulations under different stringency scenarios: a no-policy scenario, reducing CO₂ emissions by 3% a year through 2030, reducing it by 4% and finally reducing it by 5%. (The 4% scenario is in line with China’s pledge to peak by 2030 under the Paris Agreement)

The results for each of the scenarios were plugged into the GEOS-Chem model, which simulated the particulate matter formed as a result of the various pollutants (C-REM produced) combining in the atmosphere. The concentrations of the pollutants could be estimated for each province. These particulate concentrations were overlaid on a map to calculate the amount of pollution inhaled by the various communities.

The team then determined the number of deaths avoided in a province using epidemiological literature and finally calculated the economic value of these deaths using standard methods. The final result was then compared to the total cost of the implemented policy scenario.

“When you price carbon dioxide emissions, that incentivizes reducing or switching from using fossil fuels to cleaner, more expensive sources of energy has economic costs. The total economic impact of these shifts can be quantified in our model.” Karplus explained in the report

The team’s final results indicated that a no-policy scenario would result in 2.3 million premature pollution-related deaths by 2030. However reducing emissions by 3,4 & 5 percent per year would result in avoiding 36000, 94000 and 160000 premature deaths respectively. In monetary terms the savings gained as a result of health co-benefits in each of the policy related scenarios equals $138.4 billion for 3%, $339.6 billion for 4% and 534.8% billion for 5%.

So where does China stand currently in its fight against emissions?

China is currently the largest emitter of greenhouse gases in the world mainly due to the fact, most of its energy generated stems from thermal power plants. However, the world’s biggest emitter is also at the helm of the biggest mechanism to reduce carbon emissions. China’s aggressive approach to reduce emissions and introduce renewables has led it to achieve its 2020 target three years before in 2017, bringing down its emissions by 46 percent last year. China has set out to ensure its target of peaking by 2030 (peaking means the highest point emissions reach before they begin to fall). China’s current rate of cutting emissions puts it 15 years ahead of its schedule. The only question left is how soon will China peak in order to achieve the Paris Agreements goal to limit global temperatures by 2^oC.

It will be interesting to see China’s carbon reduction curve in the years to come and how it will relate to the findings of the study. It is important to note that the team stresses that a climate policy is not enough to resolve the country’s air pollution problem, having said that the study does show how significant reductions in emissions result in better air quality.

“This is really a sustainable story”, said Selin ”We have all these policy goals for a transition toward a more sustainable society. Mitigating air pollution, a leading cause of death, is one of them, and avoiding dangerous climate change is another. Thinking about how we might inform policy to address these objectives simultaneously, when they actually interact economically and atmospherically, is important to sort out from a science perspective.”