Pricing Cooling Credits

Pricing Cooling Credits

The following is a guest post by Ron Baiman.

Hi Everyone,

I’m an economist active in climate research and policy areas. Make Sunsets has invited me to write a guest blog on: “How should cooling credits be priced over time so as to avoid extreme cooling that would ‘freeze the world’?”.  I’m delighted to do this as I believe that what Make Sunsets is doing is a direct response to the most urgent climate challenge facing humanity in our times.

My first response to the question I’ve been asked is that we should all relax about this. Snowpiercer notwithstanding, there is no danger that what Make Sunsets is doing will freeze the world!  Make Sunsets has been launching balloons that loft less than 10 grams of SO2 with each launch, and Luke’s careful calculations based on a range of estimates in the literature suggest that it would take roughly a terragram (a trillion grams) of SO2 in the stratosphere, requiring more than 100 billion Make Sunsets launches, to achieve approximately 0.217 degrees C of cooling over 2.1 years!

My second and more important response to this question is that for likely the next hundred years or longer, freezing the planet will be an irrelevant question. This is because, in the absence of direct climate cooling counter measures, like what Make Sunsets is attempting to do, recent modeling suggests that global temperatures will not decline for at least 50 years after net-zero (human generated and naturally caused) GHG emissions is achieved. And even more alarmingly, a recent draft paper by James Hansen (the climate scientist who warned the US Senate in 1988 that climate change was happening) and coauthors suggests that 7-10 degrees C may already be in the pipeline even if GHG levels were frozen at 2022 levels.

So, the relevant question is the opposite one.

How should cooling-credits be priced to directly cool the planet and keep it cool even after net- positive global emissions have ceased, while we work on the more fundamental challenge of reducing and drawing down GHGs to stabilize our climate and regenerate nature on our planet over the long term?

Answer: As low as possible so that as many as possible will be bought as soon as possible!

But no need for Luke and Andrew to starve. The credits should be priced so that Make Sunsets and other private and public direct climate cooling initiatives can thrive and quickly cool our planet!

Ron Baiman

Ron Baiman is an Associate Professor of Economics at Benedictine University in Lisle, IL, outside of Chicago. He is a founder and Steering Circle member of the Healthy Planet Action Coalition, and a founder of the Chicago Political Economy Group where preprints of his latest papers on climate change (published in the Review of Radical Political Economics) can be found.

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Thank you both for your responses. Robert, I appreciate your more detailed discussion of cooling credits. As implied in my blog post, I believe that these make sense and can be reasonably estimated for direct climate cooling efforts like that of Make Sunsets. This is because Stratospheric Aerosol Injection is very high leverage, and in mid-latitudes is a “public good” in the sense that its cooling impact is (as far as I know) roughly the same regardless of location. As you point out, this is not the case for most other direct climate cooling methods which makes general direct climate cooling credit estimation for them much more difficult, though location specific cooling credit estimation may still be possible for some. BTW, since I’m responding, let me note an important clarification to my guest blog post. The recent Hansen et al. draft paper is suggesting that if GHG does not change from its current level, 7-10 C warming may be in the pipeline over the long term. This is not the same as current net-zero that would lead to a decline in short-term and then long-term GHG over time from natural fall out.
Ron Baiman

Ron Baiman

Thank you for all you do! I hope you get all the funding you need.

Rayna “Rae” Vergara

Dear Ron
Here is a comment on Radiative Forcing Credits that I wrote in January, published at
Rationale for Radiative Forcing Credits
Discussion Note: Robert Tulip
16 January 2023

Government funding to mitigate climate change should be targeted to the most efficient ways to prevent warming. The actions that will most effectively achieve that goal involve brightening the planet through albedo enhancement to cut Radiative Forcing (RF). If the purpose of funding is solely to mitigate climate change (as distinct from pollution control and other environmental issues), governments should not pretend that actions will have major effect to mitigate global warming when the evidence for the claim is weak.

Radiative Forcing Credits, also termed Cooling Credits, require analysis of the impact of an action on RF in watts per square metre. Government subsidies for preventing warming should be primarily measured on that basis. Cooling Credits have been controversially claimed by Making Sunsets, using helium and sulphur balloons, indicating the need for strong and effective governance to regulate this concept.

An example of how RF credits could work is that companies could offset the warming effect of their emissions by obtaining RF credits to refreeze the Arctic. This offset makes sense in terms of cooling by serving the goal of Net Zero Heating, as a potentially more feasible and practical and effective near-term climate policy goal than Net Zero Emissions. Equal and opposite cooling forcing should be a target to balance warming, in order to sustain Holocene conditions of sea level and biodiversity and to mitigate extreme weather. RF Credits should be discussed by economists and climate scientists to assess how they could provide a superior incentive to prevent global warming than carbon credits.

Uncertainties of RF impact to define credits can be taken into account by a conservative approach to valuation. Albedo based cooling approaches can only approximately calculate their climate impact. One option, to help integrate RF credits with carbon credits, might be to give carbon-based approaches extra weight in view of the many benefits of cutting greenhouse gases beyond the immediate effect on temperature.

There is a large order of magnitude superiority of Cooling Return On Investment from Albedo Enhancement compared to Greenhouse Gas Removal. Let’s say SRM could cut the temperature by 2°C for an ongoing annual cost of USD $40 billion (cf Wake Smith). Achieving that same temperature cut with GGR at a cost of $10 per tonne of CO2e – with long term removal – would have to remove about two trillion tonnes of CO2e, at a cost of $20 trillion. That would equal the SRM cost for 500 years. My view is this is a conservative comparison, and the reality is likely to be more in favour of SRM.

The GGR result might take 100 years to achieve, whereas MacMartin argues SAI could deliver this temperature cut in 50 years, not including Marine Cloud Brightening and other technologies. With political agreement, cooling by AE could be deployed quickly, preventing tipping points, a key point that is ignored by opponents of AE. If a sudden Arctic methane release caused ten billion tonnes of CO2e to enter the atmosphere, that would outweigh all practical GGR, causing accelerating feedbacks. This and other tipping points could possibly be prevented by the annual investment in AE, which therefore has a major security and stability benefit.

Relying just on the carbon-based cooling methods of GGR seems a bit like leaving your house wide open, whereas AE provides a precautionary security prevention, a bit like locking your doors. Medically, the analogy could be that AE is like pills for blood pressure or cholesterol, whereas GGR is like diet and exercise. If you are in bad shape, it is no use complaining that you ignored the recommended drug treatments after you have a heart attack.

This large difference in effect and purpose means the difficulty of calculation is less relevant. If the difference is large enough then a generous approach to carbon-based approaches would still be commercially competitive for albedo approaches.

My view is that credits have to be calculated and well governed by an independent international organisation. Brightening the planet has to be established on a similar governance basis as the Bretton Woods Institutions, not on a national or commercial basis but with a management system like the IMF or World Bank that is able to regulate these issues.

Cooling credits can become the key to unlock funding for planetary brightening by placing concepts in the financial context that key stakeholders are concerned about, generating attention through business opportunities. Scientific cooling proposals need a revenue stream based on clear measurement. Discussion with Venture Capital companies could generate revenue streams reasonably quickly by defining ways to make money and drive it forward. Involving big corporates can serve the goal of cooling the planet. Engaging with the corporate world to commercialise albedo enhancement has to include the scientific and academic community, to respect the need for review and transparency.

Exclusion of the fossil fuel industry confuses the agenda. Despite their power to corrupt the process through conflicts of interest, they also have resources, contacts, interests and people to physically implement cooling technologies. A Grand Bargain could involve payment to brighten the planet in exchange for a slower trajectory toward decarbonisation.

Experience with spurious carbon offsets shows need for a well regulated system. Sustainability of many carbon credits is weak, for example in forestry. Eligibility for RF credits should involve more objective quantification.

Dr Ye Tao of defined Cooling Return On Investment as “the ratio in energy in the form of heat that is removed from the Earth system per “input” of energy humans have used to create that cooling, […with the purpose to quantify] how effective at cooling the Earth any proposed climate solution is.” Dr Tao commented: “Exact calculations of cooling credit is far from trivial, for both carbon and albedo based approaches. …local feedback such as changes in upwelling IR and heat, and how the changes impact energy balance at the TOA need to be understood. Currently, this area of science is pretty much blank….We need to promote the establishment an international bureau of standards dedicated for such tasks. Such a bureau would need to develop the science and monitoring capability in close collaboration with national and international centers with remote sensing and in situ monitoring networks (to be established).”

The work by the International Organisation for Standardisation on a Standard for RF offers some helpful thinking in support of these proposals.

Robert Tulip

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