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The Positive Externalities of Carbon Dioxide: Estimating the Monetary Benefits of Rising Atmospheric CO2 Concentrations on Global Food Production

Future CO2 Benefits or Damages: Which is More Likely to Occur?


Although determining the net monetary effect of rising atmospheric CO2 is beyond the scope of this analysis, some general comments can be made with respect to the likelihood of damages or benefits occurring as a result of higher CO2 concentrations in the future.

With respect to damages, it is important to note that all SCC studies rely heavily upon computer model projections of future climate and climate-related indices. Analyses of such state-of-the-art models, however, have consistently revealed multiple problems in their abilities to accurately represent and simulate reality (Lupo and Kininmonth, 2013). Spencer (2013), for example, has highlighted an important model vs. observation discrepancy that exists for temperatures in the tropical troposphere. In written testimony before the U.S. Environment and Public Works Committee, he noted that the magnitude of global-average atmospheric warming between 1979 and 2012 is only about 50% of that predicted by the climate models. He also reported that the temperature trend over the most recent 15-year period was not significantly different from zero (meaning that there has been no temperature rise), despite this being the period of greatest greenhouse gas concentration increase. Lastly, he writes that the level of observed tropical atmospheric warming since 1979 is dramatically below that predicted by climate models. With respect to this last point, Spencer's graph of mid-tropospheric temperature variations for the tropics (20°N to 20°S) in 73 current (CMIP5) climate models versus measurements made from two satellite and four weather balloon datasets is plotted here as Figure 6.


Figure 6. Mid-tropospheric temperature variations for the tropics (20°N to 20°S) in 73 current (CMIP5) climate models versus measurements from two satellite datasets and four weather balloon datasets. From Spencer (2013).

The level of disagreement between the models and observations of tropical mid-tropospheric temperatures in Figure 6 is quite striking. It reveals, for example, that the models' projected average values are 0.5°C higher than observations at the end of the record. Although these data are restricted to the tropics (from 20°N to 20°S), Spencer notes that "this is where almost 50% of the solar energy absorbed by the Earth enters the climate system."

In concluding his discussion of the topic, Spencer candidly writes:

    It is time for scientists to entertain the possibility that there is something wrong with the assumptions built into their climate models. The fact that all of the models have been peer reviewed does not mean that any of them have been deemed to have any skill for predicting future temperatures. In the parlance of the Daubert standard for rules of scientific evidence, the models have not been successfully field tested for predicting climate change, and so far their error rate should preclude their use for predicting future climate change (Harlow & Spencer, 2011).

The sensitivity of temperature to carbon dioxide, which is the amount of total warming for a nominal doubling of atmospheric carbon dioxide, is the core parameter that ultimately drives climate model temperature projections. The magnitude of this parameter used in the models is likely the reason for their overestimation of recent (and likely future projections of) temperature observations. Although most models incorporate a mean sensitivity of 3.4°C (range of 2.1 to 4.7°C), several recent studies indicate the true sensitivity is much lower (Annan and Hargreaves, 2011; Lindzen and Choi, 2011; Schmittner et al., 2011; Aldrin et al., 2012; Hargreaves et al., 2012; Ring et al., 2012; van Hateren, 2012; Lewis, 2013; Masters, 2013; Otto et al., 2013). And until such problems are resolved, SCC damage estimates relying on future temperature projections should be considered to be significantly inflated.

A somewhat related problem with SCC calculations is their inclusion of costs due to sea level rise. Here, it is presumed that rising temperatures from CO2-induced global warming will result in an acceleration of sea level rise that will bring on a host of economic damages. There are two problems with this projection. First, temperatures are not rising in the manner or degree projected by the models. Second, observations reveal no acceleration of sea level rise over the past century. In fact, just the opposite appears to be occurring in nature.

Holgate (2007), for example, derived a mean global sea level history over the period 1904-2003. According to their calculations, the mean rate of global sea level rise was "larger in the early part of the last century (2.03 ± 0.35 mm/year 1904-1953), in comparison with the latter part (1.45 ± 0.34 mm/year 1954-2003)." In other words, contrary to model projections, the mean rate of global sea level rise (SLR) has not accelerated over the recent past. If anything, it's done just the opposite. Such observations are striking, especially considering they have occurred over a period of time when many have claimed that (1) the Earth warmed to a degree that is unprecedented over many millennia, (2) the warming resulted in a net accelerated melting of the vast majority of the world's mountain glaciers and polar ice caps, and (3) global sea level rose at an ever increasing rate.

In another paper, Boretti (2012) applied simple statistics to the two decades of information contained in the TOPEX and Jason series of satellite radar altimeter data to "better understand if the SLR is accelerating, stable or decelerating." In doing so, the Australian scientist reports that the rate of SLR is reducing over the measurement period at a rate of -0.11637 mm/year2, and that this deceleration is also "reducing" at a rate of -0.078792 mm/year3 (see Figure 7). And in light of such observations, Boretti writes that the huge deceleration of SLR over the last 10 years "is clearly the opposite of what is being predicted by the models," and that "the SLR's reduction is even more pronounced during the last 5 years." To further illustrate the importance of his findings, he notes that "in order for the prediction of a 100-cm increase in sea level by 2100 to be correct, the SLR must be almost 11 mm/year every year for the next 89 years," but he notes that "since the SLR is dropping, the predictions become increasingly unlikely," especially in view of the facts that (1) "not once in the past 20 years has the SLR of 11 mm/year ever been achieved," and that (2) "the average SLR of 3.1640 mm/year is only 20% of the SLR needed for the prediction of a one meter rise to be correct."


Figure 7. Comparison of Mean Sea Level (MSL) predictions from Rahmstorf (2007) with measurements from the TOPEX and Jason series. Adapted from Boretti (2012), who states in the figure caption that "the model predictions [of Rahmstorf (2007)] clearly do not agree with the experimental evidence in the short term."

The real-world data-based results of Holgate and Boretti, as well as those of other researchers (Morner, 2004; Jevrejeva et al., 2006; Wöppelmann et al., 2009; Houston and Dean, 2011), all suggest that rising atmospheric CO2 emissions are exerting no discernible influence on the rate of sea level rise. Clearly, SCC damages that are based on model projections of a CO2-induced acceleration of SLR must be considered inflated and unlikely to occur.

Additional commentary could be supplied with respect to other model-based projections of economic damages resulting from other climate- and extreme weather-related maladies. As reported in the most recent assessment of the Nongovernmental International Panel on Climate Change (Idso et al., 2013), in almost all instances model projections of climate and climate-related catastrophes are not borne out by observational data. Thus, SCC calculations, which are based on (and even necessitated by) the fulfillment of such computer-projected catastrophes, must be considered highly suspect and overinflated. In contrast, the monetary benefits of rising carbon dioxide, calculated to accrue to global crop production in previous sections of this report, are far more certain to occur, because they are based on hundreds of laboratory and field observations. It should also be noted that the benefit calculations reported here, although truly remarkable, may yet be found to be conservative.

Recognizing these positive impacts of rising CO2 concentrations, some researchers have begun to explore ways in which to maximize the influence of atmospheric CO2 on crop yields even more. Much of these efforts are devoted to identifying "super" hybrid cultivars that can "further break the yield ceiling" presently observed in many crops (Yang et al., 2009). De Costa et al. (2007), for example, grew 16 genotypes of rice (Oryza sativa L.) under standard lowland paddy culture with adequate water and nutrients within open-top chambers maintained at either the ambient atmospheric CO2 concentration (370 ppm) or at an elevated CO2 concentration (570 ppm). Their results indicated that the CO2-induced enhancement of the light-saturated net photosynthetic rates of the 16 different genotypes during the grain-filling period of growth ranged from +2% to +185% in the yala season (May to August) and from +22% to +320% in the maha season (November to March). Likewise, they found that the CO2-induced enhancement of the grain yields of the 16 different genotypes ranged from +4% to +175% in the yala season and from -5% to +64% in the maha season.

In commenting on their findings, the five Sri Lanka researchers say their results "demonstrate the significant genotypic variation that exists within the rice germplasm, in the response to increased atmospheric CO2 of yield and its correlated physiological parameters," and they go on to suggest that "the significant genotypic variation in this response means that genotypes that are highly responsive to elevated CO2 may be selected and incorporated into breeding programs to produce new rice varieties which would be higher yielding in a future high CO2 climate." Selecting such genotypes, as per the results experienced in the De Costa et al. study, has the potential to increase the CO2 monetary benefit per ton of rice by a factor of 4 or more!

Atmospheric CO2 enrichment also tends to enhance growth and improve plant functions in the face of environmental constraints. Conway and Toenniessen (2003), for example, describe how ameliorating four such impediments to plant productivity - soil infertility, weeds, insects and diseases, and drought - significantly boosts crop yields. Therefore, reducing the negative consequences of each of these yield-reducing factors via human ingenuity should boost crop productivity in an additive manner. And a continuation of the historical increase in the air's CO2 content should boost crop productivity even more.

In the case of soil infertility, many experiments have demonstrated that even when important nutrients are present in the soil in less than optimal amounts, enriching the air with CO2 still boosts crop yields. With respect to the soil of an African farm where their "genetic and agro-ecological technologies" have been applied, for example, Conway and Toenniessen speak of "a severe lack of phosphorus and shortages of nitrogen." Yet even in such adverse situations, atmospheric CO2 enrichment has been reported to enhance plant growth (Barrett et al., 1998; Niklaus et al., 1998; Kim et al., 2003; Rogers et al., 2006). And if supplemental fertilization is provided as described by Conway and Toenniessen, even larger CO2-induced benefits above and beyond those provided by the extra nitrogen and phosphorus applied to the soil would likely be realized.

In the case of weeds, Conway and Toenniessen speak of one of Africa's staple crops, maize, being "attacked by the parasitic weed Striga (Striga hermonthica), which sucks nutrients from roots." This weed also infects many other C4 crops of the semi-arid tropics, such as sorghum, sugar cane and millet, as well as the C3 crop rice, particularly throughout much of Africa, where it is currently one of the region's most economically important parasitic weeds. Here, too, studies have shown that atmospheric CO2 enrichment greatly reduces the damage done by this devastating weed (Watling and Press, 1997; Watling and Press, 2000).

In the case of insects and plant diseases, atmospheric CO2 enrichment also helps prevent crop losses. In a study of diseased tomato plants infected with the fungal pathogen Phytophthora parasitica, which attacks plant roots inducing water stress that decreases yields, for example, the growth-promoting effect of a doubling of the air's CO2 content completely counterbalanced the yield-reducing effect of the pathogen (Jwa and Walling, 2001). Likewise, in a review of impacts and responses of herbivorous insects maintained for relatively long periods of time in CO2-enriched environments, as described in some 30-plus different studies, Whittaker (1999) noted that insect populations, on average, have been unaffected by the extra CO2. And since plant growth is nearly universally stimulated in air of elevated CO2 concentration, Earth's crops should therefore gain a relative advantage over herbivorous insects in a high-CO2 world of the future.

Lastly, in the case of drought, there is a nearly universal bettering of plant water use efficiency that is induced by atmospheric CO2 enrichment. Fleisher et al. (2008), for example, grew potato plants (Solanum tuberosum cv. Kennebec) from "seed tubers" in soil-plant-atmosphere research chambers maintained at daytime atmospheric CO2 concentrations of either 370 or 740 ppm under well-watered and progressively water-stressed conditions. And in doing so, they found that "total biomass, yield and water use efficiency increased under elevated CO2, with the largest percent increases occurring at irrigations that induced the most water stress." In addition, they report that "water use efficiency was nearly doubled under enriched CO2 when expressed on a tuber fresh weight basis." These results indicate, in the words of the three researchers, that "increases in potato gas exchange, dry matter production and yield with elevated CO2 are consistent at various levels of water stress as compared with ambient CO2," providing what we so desperately need in today's world, and what we will need even more as the world's population continues to grow: significantly enhanced food production per unit of water used. And there are many other studies that have produced similar results (De Luis et al., 1999; Kyei-Boahen et al., 2003; Kim et al., 2006).

The same situation exists with respect to excessive heat, ozone pollution, light stress, soil toxicity and most any other environmental constraint. Atmospheric CO2 enrichment generally tends to enhance growth and improve plant functions to minimize or overcome such challenges (Idso and Singer, 2009; Idso and Idso, 2011). As researchers continue to explore these benefits and farmers select cultivars to maximize them, the monetary value of this positive externality of raising the global CO2 concentration of the atmosphere will surely increase.

Considering all of the above, it is thus far more likely to expect the monetary benefits of rising atmospheric CO2 to accrue in the future than it is to expect the accrual of monetary damages.

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