The economic damage yet to come from carbon dioxide emitted decades ago far exceeds the harm it has wrought so far, according to a new Stanford University study.
The research, published on March 25 in Nature , puts a dollar value on the harm done to individual nations and the world by carbon dioxide emitted over time by countries and major companies.
U.S. emissions since 1990, for example, have caused more than $10 trillion in global economic damages, according to the analysis. This includes large negative impacts in developing economies, including $330 billion in Brazil and $500 billion in India. In addition, nearly $3 trillion, or roughly a third of the damage caused by U.S. emissions, fell within the United States itself, while $1.4 trillion landed in Europe.
"It turns out U.S. emissions have really hurt U.S. output," said lead study author Marshall Burke , a professor of environmental social sciences at the Stanford Doerr School of Sustainability . As a percentage of national economic output, however, damages are much larger in low-income parts of the world.
Emissions tied to the production and use of oil from Saudi Aramco, the world's single largest corporate emitter, between 1988 and 2015 resulted in $3 trillion in global damages by 2020, the study found. If those emissions remain in the atmosphere through the end of the century, the damage could rise more than 20-fold to $64 trillion.
"As long as a ton of emitted carbon dioxide is up there, it is causing warming and that warming is causing damage," said Burke.
Loss and damage
The estimates are based on the study's framework for calculating the cost of impacts from climate change that countries can't prevent by cutting emissions or avoid through adaptation. Negotiators at international climate talks and lawyers in climate liability cases refer to this concept as "loss and damage."
"We typically think about dealing with climate change in two ways, either mitigating climate change – so, slowing and stopping climate change – or adapting to its impacts. Confronting the damage that occurs when mitigation and adaptation fall short is the third leg of the stool that we just don't talk about that much," Burke said.
The researchers treat greenhouse gases essentially like the industry for managing household garbage, likening "loss and damage" costs to unpaid garbage bills. "When we generate garbage, it's illegal to dump it wherever we want, because doing so creates a cost to others," said study co-author Solomon Hsiang , a professor of environmental social sciences in the Doerr School of Sustainability. "Normally, we pay someone else to take our waste away. Our legacy of greenhouse gas emissions is similar, except we've never paid the bill and it just keeps accruing interest."
Removing carbon dioxide and other greenhouse gases from the atmosphere could be a way to lower the bill. While developing new scalable technologies for greenhouse gas removal has received substantial attention in recent years , the new Stanford study shows that the timing of their deployment is critical. For example, the researchers calculate that if a ton of carbon dioxide lingers in the atmosphere for 25 years before removal, half the damage expected from that ton has already been done.
"Our study shows that because of the compounding impacts of warming on economic growth, the time since the emissions occurred is critical for accurately accounting for the loss and damage associated with past emissions, as well as the cost-benefit analysis of potential solutions," said study co-author Noah Diffenbaugh , the William Wrigley Professor and Kimmelman Family Senior Fellow in the Doerr School of Sustainability.
Accounting for long-term costs
Burke and colleagues released a preprint of the study in 2023 as a National Bureau of Economic Research working paper. In the new Nature paper, the overall damage estimates are substantially higher than their earlier results because the researchers accounted for additional delayed effects of warming on economic output.
"We see in the data that the effects of a really hot year can persist for a long time," Burke said. "When you include the long-run effects, the damage estimates get bigger."
For a large corporate emitter like Saudi Aramco, accounting for these long-run effects nearly quintuples the estimated damage from 1988-2015 emissions, the researchers said.
Applying the framework from the new paper requires some judgment calls, such as how to discount past and future damages and how much responsibility to assign for emissions from production versus consumption of fuels like oil and gas.
Determining which year is reasonable to start assigning responsibility for emissions and the damages they cause is another "important legal and ethical question," Burke said. The authors chose 1990, around the time the United Nations nearly unanimously adopted its first global climate treaty, in an attempt to limit warming and damages.
The researchers said actual damages still likely exceed their estimates, since the analysis reflects the impacts of warming on aggregate economic growth but does not account for other harms.
"We haven't accounted for impacts that aren't captured in GDP, such as loss of biodiversity and cultural homeland, and our approach also underweights some sources of climate impacts such as sea level rise and some types of extreme events," Diffenbaugh said. "This makes our estimates conservative."
Acknowledgements
Burke is also a professor (by courtesy) of Earth system science in the Stanford Doerr School of Sustainability and a senior fellow at the Freeman Spogli Institute for International Studies. He and Diffenbaugh are also senior fellows at the Stanford Woods Institute for the Environment, which is part of the Doerr School of Sustainability.
Diffenbaugh is also a professor of Earth system science at Stanford. Burke and Hsiang are senior fellows at the Stanford Institute for Economic Policy Research. Hsiang also directs the Global Policy Laboratory at the Doerr School of Sustainability.
Co-author Mustafa Zahid worked on this study as a research data analyst in Burke's Environmental Change and Human Outcomes Lab and is now a PhD student at the University of California, Berkeley.
