A review of greenhouse gas emission liabilities as the value of renewable energy for mitigating lawsuits for climate change related damages
Introduction
Renewable energy technologies (RETs) have well established benefits including: i) improving environmental sustainability [1], [2], [3], ii) improving public health [4], [5], [6], iii) creating jobs [6], [7], [8], [9] and iv) financial benefits [10], [11], [12]. The average price of completed solar photovoltaic (PV) systems has dropped 33% since 2011 [13], and the cost of electricity generated from wind also dropped more than 43% in the past four years [14]. As the economic costs of RETs have decreased they are now competitive with traditional electricity sources in many regions [10], [11], [12]. Perhaps one of RETs greatest benefits, however, is the value they bring for mitigation of greenhouse gas (GHG) emissions and the concomitant climate change [15], [16], [17], [18], [19]. Both global GHG emissions [20], [21], [22] and global atmospheric carbon dioxide (CO2) concentrations are increasing rapidly [23], [24]. The resultant climate change is well established with a high confidence as are the negative impacts on natural and socio-economic systems [25], [26] including: i) higher temperatures and heat waves that result in thousands of deaths from hyperthermia [27], [28], [29], ii) crop failures [30], [31] that aggravate global hunger [32], [33], [34], iii) power outages [35], [36], iv) rising sea levels that cause low-lying coastal areas to submerge gradually [37], [38], v) erosion of shorelines [37], [38], vi) increased risk of flooding [39], and saltwater intrusion [37], [40], vii) strong storms that cause more damage to coastal environments, increased risk of floods, [41], [42], [43], [44], viii) droughts, [45] and ix) fire [43], [46], [47]. These negative externalities have been shown to be due to human activities with the confidence level of 95% (primarily combustion of fossil fuels, which are the dominant cause of global warming from 1951 to 2010) [48], [49].
Emission trading has been considered as a solution to climate change in order to limit greenhouse gas emissions [50], [51], [52], [53]. Unfortunately, it has some disadvantages including relying on a complicated system [54], carbon price uncertainty [55], and encouraging industries that are the most dependent on coal and oil to maintain the status quo because the permits have been historically inexpensive [56]. Thus, at the present time, emissions trading as a method of mitigating climate change has essentially failed [57], [58], [59], so another method is needed.
A method gaining traction to bring these negative externalities into the market is the use of litigation, which provides a different path to motivate reducing corporate actions resulting in climate change [60], [61], [62], [63], [64], [65], [66], [67], [68], [69]. If such GHG emission litigation becomes widespread, then the one of the core benefits of RETs for emitters would be a reduction in the liability for climate change. This economic benefit is currently often ignored because of the lack of knowledge of the potential liabilities. To provide the necessary data, this paper first reviews recent literature on the potential for climate change litigation and the seven methods to quantify liability for climate change. Then, a formulation is developed to estimate the liability for GHG emitters considering i) pollution factor (which is a fraction of emissions produced by each major polluter over the overall emissions), ii) probability of human contribution to natural disasters, and iii) estimated cost of disasters. Next, the top 10 emitters in the U.S. are identified and their potential liability is quantified using standard carbon costs and this method. Potential liabilities are explored in depth with a single company comparing the results of the fractional liability from only natural disasters within the U.S. for a single year to a sensitivity of the future costs of carbon emissions from other sources of emission-related liability. Finally, potential climate change victims (potential litigants) are identified and their capacity to bring such lawsuits is evaluated. The results are discussed and conclusions are drawn about the potential value for RETs to reduce GHG emission liability.
Section snippets
Background
GHG emissions liability is created from present emissions, but can also extend into the past. For example, Farber [62] argued that not only American׳s ancestors, but also people who are living in U.S. currently are responsible for past emissions resulting in climate change due to the profit they have had from uncontrolled GHG emissions. Similarly he argued that a moral responsibility exists for Americans to limit their emissions to prevent causing damage to other people (specifically those
Nomenclature
C: Carbon price [US$/ton of CO2]
di(t): Cost of ith disaster
Dx(t): Liability of a single defendant in year t
E: Emissions [tons of CO2]
ECR: Responsibility of consumer [tons of CO2]
Eembodied: Producer׳s emissions [tons of CO2]
EISR: Responsibility of intermediate system [tons of CO2]
EP: Producer׳s emissions [tons of CO2]
EPR: Producer responsibility [tons of CO2]
Euse: Consumer׳s emissions [tons of CO2]
EX: Emissions in year t of a single defendant [tons of CO2]
Eregion: Emissions in year t of the
Potential GHG emissions liability for top 10 US emitters
The range of liabilities for the top U.S. emitters for the seven methods have been calculated using the equations from Table 1 and the results are shown in Table 2 for 2012. In the shared responsibility approach, Fe is considered to be 50%, which means the responsibility is shared equally between producer and consumer. In addition, polluter׳s pay theory is the same as producer responsibility approach, and in geographical approach the producer liability is calculated in the same way; therefore,
Conclusions
In this study the methods to quantify liability for climate change have been reviewed. The potential litigants that are well positioned to bring emission related lawsuits include those that are most threatened that have political organization such as the Island Nations making up OASIS. However, other entities such as individual nations, states, or companies that have financial losses due to climate change could seek compensation in court from emitters. Finally individuals alone or as part of
References (120)
Potential applications of renewable energy sources, biomass combustion problems in boiler power systems and combustion related environmental issues
Prog Energy Combust Sci
(2005)- et al.
Climate change and human health: impacts, vulnerability and public health
Public Health
(2006) - et al.
Public health benefits of strategies to reduce greenhouse-gas emissions: overview and implications for policy makers
Lancet
(2010) - et al.
Putting renewables and energy efficiency to work: how many jobs can the clean energy industry generate in the US?
Energy Policy
(2010) - et al.
Policies for advancing energy efficiency and renewable energy use in Brazil
Energy Policy
(2004) - et al.
A review of solar photovoltaic levelized cost of electricity
Renew Sustain Energy Rev
(2011) - et al.
Mitigating energy-related GHG emissions through renewable energy
Renew Energy
(2003) - et al.
Greenhouse gas emissions reduction by use of wind and solar energies for hydrogen and electricity production: economic factors
Int J Hydrog Energy
(2007) Renewable energy: a response to climate change
Sol Energy
(2004)- et al.
Supporting schemes for renewable energy sources and their impact on reducing the emissions of greenhouse gases in Greece
Renew Sustain Energy Rev
(2008)
The internalization of externalities in the production of electricity: willingness to pay for the attributes of a policy for renewable energy
Ecol Econ
Combining price and quantity controls to mitigate global climate change
J Public Econ
Livestock-related greenhouse gas emissions: impacts and options for policy makers
Environ Sci Policy
Effects of climate change on global food production under SRES emissions and socio-economic scenarios
Glob Environ Chang
Increasing flood risk and wetland losses due to global sea-level rise: regional and global analyses
Glob Environ Chang
A global overview of drought and heat-induced tree mortality reveals emerging climate change risks for forests
For Ecol Manag
Shared producer and consumer responsibility — theory and practice
Ecol Econ
The problem of assigning responsibility for greenhouse gas emissions
Ecol Econ
Modelling, simulation and analysis of doubly fed induction generator for wind turbines
J Electr Eng
Public health impact of air pollution and implications for the energy system
Ann Rev Energy Environ
Renewable energy markets in developing countries
Ann Rev Energy Environ
Global food demand and the sustainable intensification of agriculture
PNAS
CO2 embodied in international trade with implications for global climate policy
Environ Sci Technol
Reduced calcification of marine plankton in response to increased atmospheric CO2
Nature
The next generation of scenarios for climate change research and assessment
Nature
Excess mortality related to the August 2003 heat wave in France
Int Arch Occup Environ Health
Unprecedented heat-related deaths during the 2003 heat wave in Paris: consequences on emergency departments
Crit Care
The 2003 heat wave in France: dangerous climate change here and now: the 2003 heat wave in France
Risk Anal
Effects of climate change on environmental factors in respiratory allergic diseases
Clin Exp Allergy
Global food security under climate change
Proc Natl Acad Sci
Climate change, global food supply and risk of hunger
Philos Trans R Soc B: Biol Sci
Are you ready for the next disaster?
Adaptation of California’s electricity sector to climate change
Clim Chang
The Nile delta-Alexandria coast: vulnerability to sea-level rise, consequences and adaptation
Mitig Adapt Strateg Glob Chang
Response of wetlands to rising sea level in the lower coastal plain of North Carolina
Ecol Appl
Numerical modelling of salt-water intrusion due to human activities and sea-level change in the Godavari Delta, India
Hydrol Sci J
Sea-level rise and drought interactions accelerate forest decline on the Gulf Coast of Florida, USA
Glob Chang Biol
Climate change and forest disturbances
BioScience
Widespread crown condition decline, food web disruption, and amplified tree mortality with increased climate change-type drought
Proc Natl Acad Sci
Impacts of climate change on fire activity and fire management in the circumboreal forest
Glob Chang Biol
Fire climate change, carbon and fuel management in the Canadian boreal forest
Int J Wildland Fire
Cited by (97)
Social and economic analysis of integrated building transportation energy system
2023, Advances in Digitalization and Machine Learning for Integrated Building-Transportation Energy SystemsSynthesis of renewable diesel as a substitute for fossil fuels
2023, Renewable Diesel: Value Chain, Sustainability, and Challenges