A while back we discussed the notion of “air capture” which refers to the direct removal of carbon dioxide (CO2) from the atmosphere and referenced the work of David Keith at the University of Calgary. David has an excellent paper on this in the journal Climatic Change, available here, and David’s views on my earlier post can be found here.

With this post, I’d like to engage in some simple math on the economics of air capture. Think of this exercise a bit like the mathematician’s tendency to take things to their limit. In a policy sense, exploring air capture is also a bit like taking things to the limit. If climate change is defined as a problem of increasing atmospheric concentrations of CO2 (and other greenhouse gases), then it is logical that the solution would be to stop that increase, and some form of air capture is a logical way to do that (please note that I have not said anything about technical feasibility or economic efficiency). The exercise below explores what sort of costs air capture implies using the lower end of Keith’s cost estimates of $200 per ton of CO2 removed from the atmosphere (the upper end is simply 2.5 times higher, for those interested in those numbers). I’d like to motivate some discussion on this subject, because I’d like to understand it further. A central question that I have been pondering is: Given the numbers below, why isn’t air capture technology at the center of debate on climate change?

If the end of the world is at risk, as some have warned, should a politically-neutral technology (i.e., requires no change in behavior, no complicated negotiations, no oversight or compliance regimes, no carbon markets, nada) that may cost as little as 1% of today’s global GDP (yes, a big number I realize) at least be on the table with other options of similar magnitude costs, but with huge political obstacles to their implementation? At a minimum why isn’t air capture technology research at the center of the governmental investment in climate change technologies? I remain completely baffled by this oversight in the policy debate.

Here is the math:

Starting points: 1 ppm of CO2 equals 2.08 billion tons (Thanks to CU faculty colleague Jim White for this info!) At $200/ton air capture cost this equals $416 billion per 1 ppm CO2 scrubbed from the atmosphere.

A. Total Cost for US to reduce emissions to 1990 levels:

A1. Annual cost

1990 US CO2 emissions: 5,005,300,000 tons
2004 US CO2 emissions: 5,988,000,000 tons
Source: US EPA

Lets just say roughly 1 billion tons, annual cost of compliance to 1990 levels via air capture = $200 billion or approximately 1.5% of US GDP.

A2. Incrementally increasing costs

Yearly increase in CO2 emissions = roughly 150,000,000 tons
Annual increase in costs = $30 billion or (0.2% of US GDP)

B. Cost for Global reduction of emissions

B1. To pre-industrial values

From 380 ppm to 280 ppm requires a reduction of 100 ppm or $41.6 trillion dollars (~67% of global GDP, assuming ~$60B global GDP), with an average annual recurring cost of reducing approximately 1.5 ppm or $624 billion (~1% of global GDP).

B2. Brute force stabilization to 350 ppm

Presumably, air capture could be used to “tune” the atmospheric concentrations of CO2 to some desired concentration. From 380 to 350 ppm requires an initial reduction of 30 ppm or $12.5 trillion dollars (~21% of global GDP), with an average annual recurring cost of reducing approximately 1.5 ppm or $624 billion (~1% of global GDP).

B3. Brute force stabilization to 400 ppm

From 380 ppm to 400 ppm implies ~10 years of business as usual, and then with an average annual recurring cost of reducing approximately the annual increase of 1.5 ppm or $624 billion (~1% of global GDP). The US share of this cost would initially be approximately 25% (or somewhat less) of this total or $151 billion. Developing country costs would start out small and would increase as their economies (and emissions) grow. My first impression is that these numbers and time frame seem surprisingly reasonable.

How would any of this be paid for? I don’t know and haven’t given this much thought. But the numbers at the lower end, e.g., $151 billion for the U.S., seem to be well within the range of a gasoline or carbon tax, which could be phased in very gradually over the next 10 years.

Some caveats and notes: CO2 isn’t the only important greenhouse gas, but it is important. Cost estimates are estimates, Keith says they might be accurate to within a factor of 3, and given what I know about the uncertainty in past efforts at technological forecasting the costs could be much higher or much lower, and it is worth noting that cost estimates of this sort often wind up being far too high than what proves to be the case in reality. Nonetheless, the best data on air capture technologies will come from actual engineering experiments. As David Keith writes in his Climatic Change paper and on our blog, in reality air capture would make the most sense as a complement to other forms of mitigation and sequestration. My point here is not to propose an optimal policy in any way, but to take air capture to the limit. I am not advocating air capture as a solution (I simply don’t know enough), but I am advocating air capture as a contribution to the debate on climate change. And of course none of this addresses adaptation to climate or climate change. And above all – caveat emptor!