2011-10-02 06:11:19True Cost of Coal Power - Muller, Mendelsohn, and Nordhaus
dana1981
Dana Nuccitelli
dana1981@yahoo...
69.230.106.125

Post on a new paper regarding the external costs of coal power (and other industries/sectors of the economy).

True Cost of Coal Power - Muller, Mendelsohn, and Nordhaus

2011-10-02 10:14:02
grypo

gryposaurus@gmail...
96.253.55.56

This is good.  If you want, you can discuss the basics of Pigvogian Tax knowledge problem in the 'uncertainties' section  .  Uncertainties are actually expected.  The goal is to tax the behavior until it gets to societal exceptable levels.  It's not really about finding the exact cost.

From Wiki:

A key problem with the Pigovian tax is the "knowledge problem" suggested in Pigou's essay "Some Aspects of the Welfare State" (1954) where he writes, "It must be confessed, however, that we seldom know enough to decide in what fields and to what extent the State, on account of [the gaps between private and public costs] could interfere with individual choice." In other words, the economist's blackboard "model" assumes knowledge we don't possess — it's a model with assumed "givens" which are in fact not given to anyone. Friedrich Hayek would argue that this is knowledge which could not be provided as a "given" by any "method" yet discovered, due to insuperable cognitive limits; chaos theory argues for other cognitive limitations.[citation needed]

Aside from efficiency, Pigovian taxes may increase the fairness of how costs of negative externalities are borne. For example, even if a tax on air pollution is not at the perfect level to achieve optimal efficiency, it transfers cost associated with pollution from the public (e.g., via reduction of other taxes or benefit from public spending of the pollution tax proceeds) to the polluter.

2011-10-02 10:45:29
dana1981
Dana Nuccitelli
dana1981@yahoo...
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Interesting, thanks grypo.  Text revised.

2011-10-02 11:49:27
Andy S

skucea@telus...
66.183.165.78

This is very good. I was hoping to include some discussion of this paper in my post on fossil fuel resources and SRES scenarios but you have done it far more thoroughly (and quickly!) than I would have done.

I didn't quite understand this:

So there are clearly significant uncertainties in these estimates.  However, it's important to bear in mind that uncertainties are expected in a Pigovian tax (a tax levied to address a market externality).  Finding the exact emissions price is not necessary, because once the external cost is internalized, the emissions price can be adjusted accordingly.

This may have been written in response to Grypo's previous comment. I think that what you are saying is that any Pigovian tax, even if the exact level of an effective tax can't be determined, is a step in the right direction since at least  some part of the negative externality gets internalized. It may be just me being thick, but you might consider rewording it.

(Off topic, a bit) It bugged me a little in the recent Wigley gas vs coal analysis that the polluting effects of coal-generated aerosols were glossed over somewhat, whereas their effects on cooling were modelled and highlighted. Indeed,  the headline conclusion of the Wigley study, that gas may be worse for global warming than coal over several decades (even in the no gas leaks model), depended on the sulphate pollution from coal. The Muller study (and Epstein) shows just how damaging the polluting effects of SO2 really are, even if they do help reduce warming a bit over a few decades. I suppose a skeptic could argue that the Muller paper exaggerates the bad effects of coal, since no credit is given for the effect of sulphate pollution on climate change.

2011-10-02 16:41:10
dana1981
Dana Nuccitelli
dana1981@yahoo...
69.230.101.55
I'll try to word that a little better - it's a new concept to me [hadn't heard of a piggy tax before!]. Wigley was tricky because they focused just on climate change, whereas Muller and Epstein focused on economics and thus other effects. It's hard because sulfates kind of do us a favor by offsetting warming, but they do also have some nasty health effects. One of those Faustian bargain things.
2011-10-02 19:46:05
Rob Painting
Rob
paintingskeri@vodafone.co...
118.92.54.246

Looks good. Be nice to have a graphic or two though. I wish some of these experts would consider the PR aspect, and provide some simple graphs, pie-charts etc, to better communicate their work.  

2011-10-03 10:41:40
dana1981
Dana Nuccitelli
dana1981@yahoo...
69.230.101.55

Good point Rob.  There were a couple graphs in the paper, but they weren't terribly helpful.  I think I can come up with something though.  How about this?

coal costs

2011-10-03 17:02:56
Rob Painting
Rob
paintingskeri@vodafone.co...
118.92.39.182

Yeah, that's sweet. Big difference in external costs, between the two studies huh? 

2011-10-04 02:44:09
dana1981
Dana Nuccitelli
dana1981@yahoo...
64.129.227.4

Yeah, basically a factor of three for the ones they both accounted for.  Then Epstein accounted for several that weren't in MMN11, but the only significant one was the Apalachian health.  A big one though - even larger than climate change.

2011-10-04 15:25:13dana1981
John Hartz
John Hartz
john.hartz@hotmail...
98.122.98.161

Ceck out "Coal is the Enemy of the Human Race" by Dave Roberts on Grist. He and Brad Johnson have addressed the same paper that you have.

2011-10-04 16:18:39
dana1981
Dana Nuccitelli
dana1981@yahoo...
69.230.101.55
Hmm frankly I think my post is better because it also discusses the Epstein results. They say MMN11 is conservative, but my post demonstrates it.
2011-10-04 20:09:00
alan_marshall

alan.from.tas@gmail...
114.73.53.192

It is interesting to learn that regulating CO2 emissions from burning coal would cost much less than regulating SO2 emissions from coal. The latter has been regulated by a cap-and-trade scheme, and yet the economy has kept growing. Refusing to regulate CO2 is just stubborness and greed.

2011-10-04 20:09:58
alan_marshall

alan.from.tas@gmail...
114.73.53.192

Gets a thumbs up from me!

2011-10-05 06:16:02
Anne-Marie Blackburn
Anne-Marie Blackburn
bioluminescence@hotmail.co...
80.42.216.92

Thumbs up from me - I have little knowledge of the topic but the post is clear and well argued.

2011-10-06 09:02:11
John Hartz
John Hartz
john.hartz@hotmail...
98.122.98.161

This aticle is sure to generate a lengthy comment thread. Well done.

2011-10-06 14:06:17thanks
dana1981
Dana Nuccitelli
dana1981@yahoo...
69.230.101.55

Thanks guys.  This one will go up tomorrow morning.  We also passed it along to TreeHugger to see if they want to cross-post it.

2011-10-06 23:50:52Typo:
Kevin C

cowtan@ysbl.york.ac...
144.32.72.165

Epstein is 2011 in the text and 2001 in the figure caption.