What are the Most Cost-Effective Ways to Fight Climate Change?

Climate change is one of the most pressing issues facing mankind. In order to fight climate change, we have to find the most cost-effective ways to curb the emission of GreenHouse Gases (GHGs). A lot of different actions can be taken to combat climate change. Among them are interventions on:

• Buildings (weatherization)
• Transportation (taxes, norms)
• Land use (forest and grassland subsidies)
• Power generation (taxes and markets for polluting rights)

Allocating the amount of public and private money to the most effective uses requires an estimate of the cost-effectiveness of the various options: how much do they cost per ton of C02 saved from the atmosphere? This monetary estimate is called the abatement cost of the option.

Below is a graph comparing the estimated abatement costs of the various options with the social cost of carbon:

Abatement Cost of Various Options to Fight Climate Change (in Euros/tonC02)

It appears that the French Grassland Conservation Program is currently not a cost-effective way to fight climate change: its abatement cost is largely above the social cost of carbon.