2 - 1 Mission Concept Review 17Nov10 Bruce Wielicki, David Young, Marty Mlynczak, Rosemary Baize NASA Langley Roger Cooke Resources for the Future April

2 - 1NASA Internal Use OnlyMission Concept Review 17Nov10

IMR

Bruce Wielicki, David Young,Marty Mlynczak, Rosemary Baize

NASA Langley

Roger CookeResources for the Future

April 12, 2012

What is the Economic Value of Climate Science?


• We have traceable estimates of the economic value of weather prediction

• Climate: “Will impact societal decisions with trillion dollar impacts”

• But is this statement verified and traceable in any way, or is it just a vague qualitative statement?

• How could we quantify an economic value to climate science?– Climate change science value exists decades into the future– That value has to be treated as a risk/benefit economic analysis – Investment perspective vs insurance perspective– Rigorous analysis must take into account the uncertainties in both climate

science, economic impacts, policy– Needs to be sufficiently rigorous to be published in both economic and scientific

journals– Potential to change the dynamic of the discussion on climate change science

from “threat” to “economic investment”.

Economic Value of Climate Science

Requires a combination of climate science and economics expertise


50% of CLARREO Science Value is in Reflected Solar Spectra50% of CLARREO Science Value is in Infrared Spectra & GNSS-RO

Roe and Baker, 2007

- Temperature- Water Vapor- Clouds- Radiation- Snow/Ice Cover

- Greenhouse Gases - Surface Albedo Cloud Feedback

Water Vapor/Lapse Rate Feedback

Snow/Ice Albedo Feedback

Earth's Climate

Blue = CLARREO Solar Reflected Spectra ScienceRed = CLARREO IR spectra & GNSS-RO Science

CLARREO Science ValueClimate Forcing, Response, Feedback

100% of CLARREO Science Value is in the Accuracy of the Data


Climate Sensitivity uncertainty isdriven by uncertain Feedbacks:• Factor of 3 uncertainty in

response to doubled CO2 • Relative uncertainty known

Climate Change Response: • Temperature Profile,• Water Vapor Profile, • Cloud Properties,• Surface albedo (snow, sea-ice,

land cover)

Radiative Forcings:• Verify greenhouse gas infrared

radiation effects• Aerosols advances by GLORY

APS and NRC ACE missions.

Science Impact

Effective Climate Forcings (W/m2): 1750-2000

0.26

0.090.05

0.24


Climate Trend Accuracy & Calibration: IR

Climate Change Accuracy is Critical to Making Difficult Policy Decisions

Example for Temperature Trends

• CLARREO accuracy goals are optimal cost/value

• High confidence critical for policy decisions

• CLARREO accuracy designed to provide that confidence.

• Uncertainty includes orbit sampling, instrument noise

• CLARREO is within 20% of a perfect observing system


Climate Trend Accuracy & Calibration: RS

Climate Change Accuracy is Critical to Making Difficult Policy Decisions

Example for decadal change incloud feedback: changing SW Cloud Radiative Forcing

• All major error sources included: - absolute accuracy assumes gaps occur, - orbit sampling (90 deg), - instrument noise, - reference intercalibration uncertainty (CERES)

• CLARREO trend accuracy is within 20% of a perfect observing system.


• Roger Cooke at Resources for the Future– IPCC impacts chapter lead author – Mathematician/Risk Analysis Theory– Participated in recent workshop on socioeconomic benefits of earth science– Run and modify Integrated Economic Assessment (IAM) models– Expertise in “fat tails” analysis of economic impacts of statistically rare events– Was attracted to CLARREO by our accuracy requirements development and

science value matrix concept: and especially the previous 2 figures.

• Economic Model – Dynamic Integrated model of Climate and the Economy (DICE 2007), Nordhaus,

2008. Includes uncertainties in climate sensitivity, economics Can vary discount rates assumed: 1.5% (Stern), 3% (moderate), 5.5% (Nordhaus)

– Interagency Memo on the Social Cost of Carbon (IMSCC, 2010)– Policy options: Business as Usual (BAU), DICE Optimal, Aggressive Emission

Reductions (AER), Stern, 2007.– Climate change economic impacts scale with square of temperature change

How does this fit with economics?

Climate Sensitivity and Discount Rates Dominate Economic Impacts


• Cooke Initial Example Calculation– Assume world continues on "Business as Usual" policy track– Calculate economic impact costs through 2115.– Assume actual climate sensitivity is 5.8C for doubled CO2 (high end)– Assume that in 2055 we finally realize that climate sensitivity is high and we

switch from BAU to the Aggressive Emissions Reductions policy track– Now imagine that science advances allow us to discover we were on a high

sensitivity track by 2035 instead of 2055. – What is the economic value in todays dollars of society of discovering this 20

years earlier (i.e. the present value in economic terms).– Assume discount rate is 3%: above Stern but below Nordhaus– In this case, value to society of 20 year advance knowledge is $3.6 Trillion in

2012 dollars!– What is the cost of a full climate observing system? Roughly $10B/yr more than

we currently spend (U.S.: $2B/yr, International: $2B/yr). If we started a crash course in 2013 to 2035: 22 years or $220B. But put in todays dollars it would be less because of the 3% discount rate.

Sample Economic Calculation

$200 Billion investment to save $3.6 Trillion?


• Worst case scenario: i.e. biggest cost savings

• A higher discount rate will drop the value, a lower discount rate raises it.– At 5.5% discount rate value drops to $600B (from $3,600B)– At 1.5% discount rate the value increases to $10,800B (from $3,600B)– Appropriate discount rates remain a huge debate in the economic community

• A distribution of climate sensitivity will drop the value– Quadratic dependence of economic impacts on climate sensitivity– Use a back of the envelope spreadsheet climate sensitivity distribution roughly like IPCC– At 1.5% discount rate: economic value today is $3,800B– At 3% discount rate: economic value today is $1,300B– At 5.5% discount rate: economic value is $210B

Caveats on Initial Calculation

We understand where the key uncertainties are


• Wielicki/Young/Cooke proposal accepted for initial $60K Science Innovation Fund study to flesh out the concept by Sept 2012

• Instead of a step function for decision: use a narrowing uncertainty in climate sensitivity with time.

• Compare the science value with/without CLARREO• Compare science value with different start dates for CLARREO• Compare temperature trend estimation of climate sensitivity vs cloud

feedback (cloud radiative forcing) estimation– Temperature trends: high sensitivity have slower response– Cloud feedback: response depends on fast vs slow feedback

• Present as value of entire climate observing system– CLARREO is used as the key example– Point out need independent confirmation of ocean heat storage, sea level rise, ice sheet

mass loss, carbon cycle feedbacks, ecosystem impacts, etc– Point out value of more rapid verification of the impacts of policy shifts on carbon emissions

• Publish in both science and economics literature to start discussion (e.g. EOS, BAMS, economics journals)

Next Steps

Add rigor to first back of the envelope calculation


• Vary fast (< 1yr) vs slow (wait for ocean warming) cloud feedbacks• Use multiple Integrated Economic Assessment models (FUND, PAGE)• Consider narrowing uncertainties in other feedbacks as well• Vary uncertainty in aerosol radiative forcing• Add nonlinear climate change trends with nonlinear forcing build up• Vary emissions/policy decisions beyond the 3 in DICE 2007• Add LW and net cloud radiative forcing (initial is SW CRF: low clouds)• Consider the effect of adding "fat tails": abrupt climate change that is unlikely

but a very large impact: e.g. much larger sea level rise than expected, carbon feedbacks from tundra and ocean bottom methane

• Bring in uncertainties and value of other components of the climate observing system

• Publish results in both climate science and economic journals• Search for next step funding: doesn't fit any normal ROSES or other science

competition in NASA/NOAA/NSF/DOE: need to get very creative. • Once we get the discussion going, should drive further innovation in this area

Long Term Development

We have a longer term view of how to evolve


• Change the discussion from fear or concern about climate change to a more constructive discussion of economic investment strategy

• Provide a more rigorous justification for the economic value of science

• Provide a methodology broadly useful to understanding the economic value of climate science

Impact on Climate Change Discussions

Help communicate the value of CLARREO and climate science overall

Documents

2 - 1 Mission Concept Review 17Nov10 Bruce Wielicki, David Young, Marty Mlynczak, Rosemary Baize NASA Langley Roger Cooke Resources for the Future April