Health benefits offset costs of climate policies — MIT study

Savings due to avoided health problems help offset — and in some cases greatly outweigh — the costs of carbon dioxide-cutting policies in the United States, according to a new study.


The study, led by Massachusetts Institute of Technology, found that health benefits offset between 26 and 1,050 percent of the cost of greenhouse gas reduction policies. The study examined three different types of climate policies: a clean-energy standard, a transportation policy targeting on-road vehicles and a cap-and-trade program.


Health benefits occur because the policies not only cut carbon dioxide emissions but also lead to reductions in pollutants that form ground-level ozone and fine particulate matter, the researchers said. Both pollutants can cause asthma attacks and heart and lung disease.


“If cost-benefit analyses of climate policies don’t include the significant health benefits from healthier air, they dramatically underestimate the benefits of these policies,” said lead author Tammy Thompson, formerly at MIT and now a researcher at Colorado State University, in a release.


The results of the study were published yesterday in the journal Nature Climate Change. The study was funded in part by U.S. EPA, the Department of Energy and the Massachusetts Institute of Technology.


The researchers call the study the most detailed assessment to date on the interactions between climate policies, air pollution impacts, and the costs and benefits of both. The team used models to examine the impacts of climate policies on local and regional air quality, focusing on ozone and particulate matter levels between now and 2030.


“We examine the entire pathway linking climate policies, economic sector responses, emissions, regional air quality, human health and related economic impacts, using advanced models at every stage,” the researchers wrote.


The three policies were chosen because they resemble approaches that have been considered in the United States. Of the trio, the clean energy standard would require emissions reductions from power plants that are similar to those in EPA’s recently proposed clean power plan.


Industry and business groups have charged that the policy would lead to job losses, economic damage and inequality among states.


But the MIT study found that a clean energy standard would lead to health savings of $247 billion compared to a $208 billion cost. The savings from a cap-and-trade program would be higher, more than 10 times the $14 billion cost, they said.


Savings came in the form of avoided hospital admissions and saved sick days linked to reductions in ozone and particulate matter. The savings remained relatively constant among the policies.


“Carbon-reduction policies significantly improve air quality,” said Noelle Selin, an assistant professor of engineering systems and atmospheric chemistry at MIT and co-author of the study, in the release. “In fact, policies aimed at cutting carbon emissions improve air quality by a similar amount as policies specifically targeting air pollution.”


The health co-benefits from a transportation policy, though, would recoup just 26 percent of its costs, due to a high price tag of more than $1 trillion.


The results take into account present air quality regulations, but the authors note that benefits would decline if EPA changes the base line by issuing policies between now and 2030 that would require large reductions in ozone, particulate matter and other conventional pollutants.


For all three of the carbon policies, co-benefits would become tapped out after a certain point and carbon emissions reductions wouldn’t lead to greater improvements in air quality.


“While air quality co-benefits can be comparable with policy costs for present-day air quality and near-term U.S. carbon policies, potential co-benefits rapidly diminish as carbon policies become more stringent,” the MIT study said.


The authors said that carbon policies, though, would need to advance beyond that point in order to effectively manage climate change.


“While air-pollution benefits can help motivate carbon policies today, these carbon policies are just the first step,” Selin said in the release. “To manage climate change, we’ll have to make carbon cuts that go beyond the initial reductions that lead to the largest air-pollution benefits.”