The cost of mitigation revisited

Estimates of economic implications of climate policy are important inputs into policy-making. Despite care to contextualize quantitative assessments of mitigation costs, one strong view outside academic climate economics is that achieving Paris Agreement goals implies sizable macroeconomic losses. Here, we argue that this notion results from unwarranted simplification or omission of the complexities of quantifying mitigation costs, which generates ambiguity in communication and interpretation. We synthesize key factors influencing mitigation cost estimates to guide interpretation of estimates, for example from the Intergovernmental Panel on Climate Change, and suggest ways to improve the underlying models. We propose alternatives for the scenario design framework, the framing of mitigation costs and the methods used to derive them, to better inform public debate and policy. Assessing the cost of climate change mitigation is essential to policy-making, yet for many the perception remains that meeting climate goals will entail economic loss. This Perspective unpacks key aspects of mitigation cost estimates to clarify interpretation and discussion of costs.

Automated summary

Estimating the economic implications of climate policy plays a crucial role in policy-making, yet the perception that achieving Paris Agreement goals will lead to economic losses is often based on oversimplified or overlooked complexities in quantifying mitigation costs. It is important to understand key factors influencing mitigation cost estimates in order to inform public debate and policy-making more effectively.