The deadly costs of continuing to rely on coal
Trillions of dollars also at risk from unchecked climate change
A new scientific study, published by the New York Academy of Sciences, estimates that the burning of US coal costs the nation up to US$500 billion (sic) a year in "hidden" health, economic and environmental costs.
The study's author, Dr Paul Epstein, concludes that among Appalachian communities alone (home to so-called "mountain top destruction") public health burdens from coal mining amount to nearly $74.6 billion each year.
The report, entitled The True Cost of Coal, can be downloaded free here
See also this week's news item: US protestors "go to the Mountain top"
Another study, also released last week, estimates that the human and environmental costs of greenhouse gas emmissions could exceed US$4 000,000,000,000 by 2030.
At the same time, it points out that global warming-related policy changes could boost the cost of carbon emissions for power generators, aluminum smelters, transport and other sectors.
The inter-disciplinary scientific study claims that, unless "stern action" is taken sooner, rather than later, the price of traded carbon "permits" will rise to US$220 a tonne over the next twenty years - double the current figure.
Investments Worth Trillions At Risk From Climate Change: Study
By David Fogarty
17 February 2011
Singapore - Climate change could put trillions of investment dollars at risk over the next 20 years, a global study released on Wednesday said, calling for pension funds and other investors to overhaul how they allocate funds.
Risks from more extreme weather, continued delay in climate policy by governments and uncertainty over the shape of a new global climate pact were major concerns, while renewable energy, agriculture and infrastructure could be opportunities.
The study, led by global investment consultancy Mercer, describes climate change as systemic risk because it challenges the conventional allocation of assets and requires new ways of assessing climate policy and change risks.
For example, global warming-related policy changes could boost the cost of carbon emissions for power generators, aluminum smelters, transport and other sectors by $8 trillion by 2030, said the report.
The Investor Group on Climate Change in Australia, which represents about $600 billion in assets under management, said stronger climate change policies were needed to drive emissions-cutting investments and reduce longer-term risks.
"Weather events like the recent floods in Australia will continue to impact infrastructure, food security and property, contributing to material portfolio risk for institutional investors," Chief Executive Nathan Fabian told Reuters.
The study was compiled with the help of the International Finance Corporation, part of the World Bank, and 14 institutional investors, mostly pension funds.
The report, designed as an investment guide, looked at four climate policy scenarios.
These ranged from regional divergence where some regions, such as the European Union and China/East Asia take strong action to reduce greenhouse gas emissions, to the least-likely scenario of a breakdown in efforts to fight climate change.
It also looked at the estimated flow of investment into low-carbon technologies such as wind, solar and nuclear, the impacts of climate change such as more extreme storms, floods and rising sea levels and costs from global carbon policy decisions.
It found that the cost of impacts on the environment, health and food security could exceed $4 trillion by 2030, with longer policy delays bringing rising costs, mostly from adaptation spending such as building sea walls.
It also found that investment needs could top $5 trillion by 2030 for low-carbon technologies such as energy efficiency, biofuels, nuclear power and carbon capture and storage.
Carbon Price Risk
The authors found a split between regions on emissions policies the most likely of the scenarios, with a cost on carbon pollution at $110 per tonne in the countries studied.
The "delayed action" scenario sees carbon costing just $15 a tonne to 2020, but jumping to $220 a tonne globally as 2030 nears.
Taking stern action sooner on climate policy was the least disruptive and best for investors, said the report.
"The uncertainties are lower than for the other scenarios, as investors are able to predict the pathways of policies with a reasonable degree of confidence," says the report of the "stern action" scenario.
Private equity investment opportunities in renewable energy, forestry and agriculture, infrastructure and real estate were also dependent on regional policies, it said.
(Editing by Clarence Fernandez)
Coal Costs the U.S. $500 Billion Annually in Health, Economic, Environmental Impacts
By Ariel Schwartz
16 February 2011
A report from Harvard researchers in this month's Annals of the New York Academy of Sciences will reveal that coal use costs the U.S. between a third and over half a trillion dollars each year in health, economic, and environmental impacts.
Coal is the most popular electricity-generating fuel, with 40% of electricity worldwide generated by coal plants. It's a number that is only expected to grow; by 2030, electricity demand around the world will double. But while coal is cheap and abundant, it has plenty of hidden costs.
The report, written by Dr. Paul Epstein, associate director of the Center for Health and the Global Environment at Harvard Medical School, examines the life cycle of coal production to find "hidden costs," or costs that occur "when the activity of one agent affects the well-being of another agent outside of any type of market mechanism."
These costs include damages from climate change (like weather events and rising seas, public health damages from toxins released during electricity generation, deaths from rail accidents during coal transport, public health problems in coal-mining regions (in Appalachia, mountaintop removal contaminates surface and groundwater with carcinogens and heavy metals), government subsidies, and lost value of abandoned mine areas.
In Appalachian communities alone, public health burdens from coal mining cost $74.6 billion each year. Air pollutant emissions cost $187.5 billion, mercury emission impacts reach $29.3 billion, and greenhouse gas emissions (and accompanying climate change effects) from coal-fired plants costs between between $61.7 and $205.8 billion. And then there are the smaller costs--between $2.2 and $10 billion in impacts from land disturbances, and impacts from toxic spills, declines in property values, tourism loss, and crop damage.
The paper isn't too bullish on carbon capture and storage at coal plants, either, explaining that "in addition to the control technique not altering the upstream life cycle cost--significant obstacles lie in the way, including the costs of construction of suitable plants and underground storage facilities."
So what can be done? The world must phase out coal use--or face ever-increasing health and environmental costs. Alternative energy sources may be more expensive when the monthly energy bill arrives, but that is clearly only part of the story.