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Economics vs. Physical-based Metrics for Relative Greenhouse Gas Valuations

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  • Johansson, Daniel J.A.

    (Department of Economics, School of Business, Economics and Law, Göteborg University)

Abstract

A range of alternatives to the Global Warming Potential (GWP) have been suggested in the scientific literature. One of these alternative metrics that has received significant attention is the cost-effective relative valuation of greenhouse gases. However, this metric is based on complex optimising integrated assessment models that are far from transparent to the general scientist or policymaker. Here we present a new analytic metric, the Cost-Effective Temperature Potential (CETP) which is based on an approximation of the cost-effective relative valuation. We show that this metric shares many similarities with the purely physical metric, Global Temperature change Potential (GTP), but that the CETP performs much better as an approximation to the cost-effective relative valuation.

Suggested Citation

  • Johansson, Daniel J.A., 2009. "Economics vs. Physical-based Metrics for Relative Greenhouse Gas Valuations," Working Papers in Economics 363, University of Gothenburg, Department of Economics.
    • Handle: RePEc:hhs:gunwpe:0363
    Note: Division of Physical Resource Theory, Department of Energy and Environment, Chalmers University of Technology, Gothenburg, Sweden
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    File URL: http://hdl.handle.net/2077/20346
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    More about this item

    Keywords

    GWP; GTP; cost-effectiveness; stabilization; climate change;
    All these keywords.

    JEL classification:

    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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