CIEL - Climate Impact Equity Lens | Climate Change Gets Personal

How does CIEL work?

CIEL compares the damages from preventable climate change to the savings from not reducing emissions, using a scenario of the future climate and economy in which no emissions cuts occur and another scenario in which maximum efforts are made to reduce emissions. CIEL uses temperatures, incomes, damages and emissions reduction cost estimates from CRED model scenarios. CIEL was built in Excel 2007 and is available for download. For a more detailed methodology, click here.

Like many other models of the climate and economy, CIEL weighs the costs of climate change against the benefits of avoiding emissions reduction costs. But unlike other models, CIEL looks at costs and benefits for each person individually, instead of the average costs and benefits for large regions. CIEL also views costs and benefits one decade at a time and leaves policy recommendations up to each reader, while other models often recommend a "best" emissions reduction policy based on the sum of "discounted" costs over several hundred years.

How is CIEL different from other models?

Policymakers rely on the results of climate-economics models to help answer questions such as: How much money should be invested in reducing greenhouse gas emissions? Can we wait a few decades (or centuries) before spending that money? And, how much of the bill should each country have to pay?

Economic models weigh the costs of suffering the impacts of climate change (damaged property, lost income, lower economic productivity) against the savings from not paying for emissions reductions (lower electricity and fuel costs, less money spent on insulating homes and building electric cars). If savings are greater than costs, the best policy is to do nothing at all – to ignore climate change until its damages seem more urgent.

Two problems arise from this common practice of ignoring individual differences. First, when people in a country or region are aggregated (lumped together), each person's different experience is lost. Second, when policy recommendations are "discounted", models assume that people today care only (or at least most) about themselves, and less about their children or grandchildren.

Aggregating across regions

In every public policy issue, there are winners and losers – not everyone is in the same boat. Aggregating all the people in a region gives the impression that everyone has the same income, the same vulnerability to climate change, and the same reliance on fossil fuels. Of course, nothing could be farther from the truth. Climate-economic models add up all of the damage costs suffered by everyone, everywhere, and compare them with all of the savings of not reducing emissions. That is, the models aggregate over very large regions.

By lumping together everyone in a region, we miss out on a key policy insight: Some people will be winners from climate change (benefits greater than costs) and some will be losers (costs greater than benefits). If you are among those suffering net losses, or care about people who are, the fact that in a particular year, savings from not reducing emissions may outweigh damage costs for your region as a whole isn't going to be of much comfort to you.

ME, YOU, and World

Imagine comparing the costs and benefits of climate change in a world in which just two individuals lived; we'll call them ME and YOU. ME and YOU have the same income ($2,000 a year) but live in different regions (with different patterns of energy use) and have different vulnerabilities to climate change.

In 2100, ME suffers $100 in climate damages, but saves $1,000 by not reducing emissions. YOU suffers $500 in damages and gains just $200 in savings from not reducing emissions. A typical cost-benefit analysis adds the results for ME and YOU to assess the impact on the "World" as a whole – $600 in costs and $1,200 in savings – and recommends against rapid emission reductions.

CIEL avoids the problem of aggregating across regions by looking at climate damage costs and savings from not reducing emissions for individuals, not averages. Individuals in the same region will not have the same experience of climate change. Some will suffer net losses; others will reap net gains. Decisions about climate policy need to consider the diversity of the human experience.

Aggregating across time

Every public policy problem requires some forecasting (making the best possible projections of what will happen in the future), but climate change is exceptional in how far into the future it is necessary to forecast. While some climate damages have already begun to occur, economic losses are expected to ramp up in 50 to 100 years, and could reach catastrophic levels in 100 to 150 years. How do we add up costs that will take place this year with costs that will take place in 150 years?

In economic analysis, the most common approach is to "discount" (scale down) costs that take place in the far future – the farther into the future a cost occurs the less weight it is given. Some models discount so heavily that losses that will occur 50 or 100 years from now are given a vanishingly small weight in comparison to current losses, and their policy recommendations focus on today's costs and savings ignoring effects on later generations.

Impacts on future generations

Policymakers often rely on climate-economics forecasts without really knowing what makes them tick. Recommended policy actions taken from some of the most prominent climate-economics models – often calling for policymakers to "do nothing, and do it slowly" – are based on the assumption that future damages matter little to today's population. Policy recommendations based on models designed in this way may be taken, mistakenly, as scientific fact, when really they are a result of a moral judgment that is not widely shared.

CIEL avoids making policy recommendation based on discounted aggregations across time by presenting costs and damages for each decade separately from now until 2200 – there is no attempt to add together costs from different years, so there is no need for value-laden discounting. Instead, CIEL tracks each individual's impacts over time. Decisions about climate policy require an unobstructed view of the future, free of any judgment regarding how much each generation's losses are worth.

Climate change gets personal

By zooming in on damages to a particular person in a particular year, CIEL offers a new vantage point on climate-change decision making. CIEL doesn't provide any simple recommendations about the best climate policy. And that's the point.

When climate-economics models simplify they miss the big picture: In the absence of climate policy, some people will suffer devastating damages from climate change in the near future, and by the end of this century, most people will be experiencing very serious climate damages. Aggregating across regions and time obscures the winners and losers from climate change, showing instead an "average person" whose savings may be just a little bit higher than her costs for decades. CIEL replaces impossibly "average people" with real people.