The cost of action vs. inaction – air quality

Early in the climate response debate, economists were slipped in between scientists and decision makers. I was one of them.

My role was to ‘translate the science’ but it was more a question of timing i.e. when was the right time to take action on climate change. For instance, many decision makers wanted to understand the point at which the cost of action would be less than inaction.

So, in the spirit of this process, let’s examine the impact of recent bushfires to determine what the costs were.

• The recent bushfires emitted 250 million tonnes according to NASA
• Social cost of carbon discussions are not area of strength but the view is that the cost this could range between $50 and $200 depending on the discount rate

• The social cost of carbon then is more $12.5-$50 billion for the bushfires
• As I said, I am not a strong social cost of carbon person
• I do however, understand the health implications of wood smoke on humans
• The bushfire smoke was comprised of PM10 and PM2.5
• Previous work shows that health impacts of PM10 per tonne

• PM2.5 health costs are between $3,382 and $305,997 per tonne
• The implication is that the health impacts of the bush smoke could between $3,000 and $305,000 per tonne – $750 billion to $75 trillion.
• The impact of climate change is to increase the probability of bush fires by increasing number of hazardous days by 4-25% by 2020. If the likelihood of large bushfires increases by a percentage of the hazardous days increase – 3% then the costs are $22.5 billon to $2.25 trillion annually.

Starting major climate responses is the right decision.