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Assessing climate change and biodiversity impacts
Reported by Carmen Smith, Engagement Coordinator, Centre for Science and Policy
In March 2024, the Cambridge Zero Policy Forum met with Juan-Carlos Ciscar, Scientific Officer at the Joint Research Centre (JRC) of the European Commission (EC), to discuss the challenges and opportunities in assessing climate and biodiversity risks.
Assessing the costs of climate inaction
The European Commission has proposed a 90% reduction in greenhouse gas emissions by 2040. The EC proposal includes an assessment of the cost of climate inaction, following the requirements of European Climate Law. Participants discussed that several fundamental cost categories are hard to model and quantify in economic terms; that is notably the case for damages to nature as well as catastrophic climate impacts and their associated socio-economic implications.
Improving economic modelling
The new JRC PESETA European study (JRC PESETA V, also known as the TRACE project) will focus on the regional dimension of 15 different climate risks, for around 1400 regions across Europe. Taking a regional granular level approach involves dealing with greater uncertainty, and with the associated challenges in the treatment and communication of uncertainty. The results of the new pan-European assessment will be potentially of relevance for many stakeholders, including the financial community and policy makers at the local, regional and country levels.
Participants discussed the value of using disaggregated data vs aggregated data. While aggregated numbers may capture attention as it can show the large potential damage to the overall economy due to climate change, results at the local and regional scales can be of interest for decision makers in order to cope with climate risks and decide what sort of actions should happen at that scale.
Methods of dealing with uncertainty: Cost-benefit analysis vs risk-opportunity analysis
There are two general approaches to address the design of climate policies. The first approach is a cost-benefit analysis, where the benefits and costs of specific mitigation targets are compared. An alternative is to take the climate target as given (i.e. the objectives of the Paris Agreement) and design the climate policies that minimise the abatement costs, in an approach called cost effectiveness.
A risk-opportunity analysis was suggested as a better approach that moves beyond the obvious limitations of cost-benefit analysis: we do not know what the future will look like but the benefits of acting now may outweigh the risks of not acting. Increasingly the balance of risk and opportunity is shifting with green innovation becoming more reliable, and entanglement in fossil fuels perhaps seen as riskier. Policy makers have a very clear role in shaping the landscape and determining the balance of risks and opportunities when making policy choices.
Biophysical impact models as a solution
The question of how to model the value of nature was discussed. According to the report Nature Risk Rising published by the World Economic Forum, over half the world's total GDP is moderately or highly dependent on nature. This seems to illustrate that economic models are not able to properly account for the relationships between nature and the economic system; obviously, zero nature would imply zero GDP. Some key difficulties are related to the integration of nonlinear catastrophic impacts and, more broadly, impacts on nature. In this context, a University of Exeter report was cited as offering an important critique to the scenarios put forward by the Network for Greening the Financial System (NGFS).
Minimising uncertainty is about putting a value on nature and determining thresholds for usable equations and models. However, this raises ethical questions such as whether some animals are more important than others, are animals more important than humans, are there meaningful economic boundaries and how do you construct practical time series data for nature. Some of these issues were mentioned in relation to Andrew Balmford’s land sharing versus land sparing argument for the need for greater interventions for nature.
A disconnect was found between those working in biodiversity and nature conservation, and those working in other areas. While output from one group may input to another group, one participant highlighted that there is seldom feedback between groups and little true interdisciplinary collaboration. There is work to do to bridge these gaps, but it was noted that it is difficult to bring together efforts, agree concepts and agree approaches when disciplines and expertise are so different.
Communicating climate risks to society
Participants highlighted the need to not only convey the data, but also the context in which the data is produced. Before communicating and disseminating information, the research technician must decide when to use what model and for whom does the information apply.
Participants discussed the importance of tailoring messaging and the need for academics to engage with communication experts. Communication is not a neutral landscape, meaning that countering misinformation is equally as important and tailored messaging.
As a statistician, convincing the public that your model is the right one can be difficult, particularly as there are huge ranges of uncertainty to contend with, and different models are silos e.g. a nature model may describe the causes of loss of biodiversity, but this does not relate to other climate or economic models, and there is a lack of feedback loops between them. Communicating the costs of inaction and climate impacts was therefore agreed to be interdisciplinary work, requiring the input of psychologists, neuroscientists and experts in communication. Finally, political leadership that is sympathetic to the need to act on climate, was highlighted as essential in all countries for research to be impactful.
Cambridge Zero Policy Forum
The Cambridge Zero Policy Forum is a multidisciplinary community of senior academics contributing evidence and expertise to public policies for the transition to a sustainable, inclusive, and resilient net zero society. The Cambridge Zero Policy Forum is led by Director Prof Emily Shuckburgh, Dr Rob Doubleday, Executive Director of the Centre for Science and Policy (CSaP), and Emily Farnworth, Director of the Centre for Climate Engagement at Hughes Hall. The secretariat to the Policy Forum is provided by CSaP.
Image by Guillaume Périgois on Unsplash
Dr Carmen Smith
Centre for Science and Policy, University of Cambridge