The single greatest threat to the planet’s food, water and energy security and the stability of the nexus is arguably climate change. On May 9, 2013 researchers located at the Mauna Loa Observatory on the big island of Hawaii measured an ominous milestone regarding climate change. For the first time in three million years the atmospheric concentration of carbon dioxide (CO2 ) registered at 400 parts per million (ppm). At 400 ppm the earth’s atmosphere is in uncertain territory as some scientists and environmental groups recommend that — to achieve a stable climate — the atmospheric CO2 levels should be reduced to 350 ppm. At that level, we are less likely to see the high temperatures, rising seas and intensifying storms that are more probable as we go past the 400 ppm mark.
The 400 ppm measurement is a record daily average, since the levels of carbon dioxide fluctuate by season and by location. The observatory’s location in Hawaii was chosen specifically due to the cleanliness of the air that produces more accurate measurements than what would be measured close to areas with higher carbon dioxide emissions. The observatory has taken measurements since the late 1950s (initial measurements recorded CO2 concentrations of 315 ppm) and has demonstrated a gradual increase of atmospheric CO2 concentrations ever since.
400 ppm is just a milestone, but it’s one more indicator that we are living in the Anthropocene era of history where human activity significantly affects the environment and subsequently, our food, water and energy security.
With regards to climate change, 400 ppm is a psychological rather than a physical threshold. With spring in full swing in the Northern Hemisphere, plants will start to suck CO2 out of the atmosphere, reducing the CO2 ppm below the 400 ppm level, but that doesn’t slow a path to 450 ppm or more, at which level we are looking at a 2 degrees Celsius increase in global temperatures. The Copenhagen Accord in December 2009 recognized the scientific view that the increase in global temperatures should be below 2 degrees Celsius.
To achieve that target, countries across the globe will have to use public policy to slow and then reduce emissions. Public policy options range from setting a carbon price (with a tax or “cap and trade” program) to “command and control” laws and regulation to keep fossil fuels in the ground. Current policies, such as the international Kyoto Protocol, have met with limited success and have done little to adequately reduce greenhouse gas emissions.
On the other hand, fossil fuel companies are sitting on enough coal, natural gas and oil reserves that, when burned, will undoubtedly push us past the 450 ppm mark. The combination of needing to limit carbon dioxide emissions and having fossil fuel companies that are valued by their proven reserves is what Carbon Tracker, a non-profit organization, is calling the “Carbon Bubble” in their new report, ‘Unburnable carbon 2013 : Wasted capital and stranded assets.’ The report argues that “60-80% of coal, oil and gas reserves of publicly listed companies are ‘unburnable’ if the world is to have a chance of not exceeding global warming of 2°C.” This means that investors in these companies could take a financial hit if climate risks are factored in the companies’ market valuation.
Carbon Tracker’s analysis came up with a ‘carbon budget’ of about 1,000 gigatons of carbon that can be put into the atmosphere if we want to have a chance to keep global temperatures below 2 degrees Celsius. So, it is disconcerting that the total proven international reserves account for 2,860 gigatons of carbon dioxide just as the largest fossil fuel companies will continue to spend hundreds of billions of dollars on developing new reserves. If public policy shifts to something closer to the 1,000 gigaton budget, there would be a lot of stranded assets and investors would get burned, as the fossil fuels would not.
Critics of the report argue that the market dictates worth and we still don’t quite understand climate sensitivity to increases in CO2 concentrations. And a carbon budget may not be the best public policy tool for addressing climate change. But as the Economist notes, “[a]t the moment neither public policies nor markets reflect the risks of a warmer world.” Four hundred ppm is just a milestone, but it’s just one more indicator that we are living in the Anthropocene era of history where human activity significantly affects the environment and subsequently, our food, water and energy security.