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101
11
Economics
Abstract
Economic considerations impact many decisions relevant to reducing greenhouse gas emissions and improving air quality. Research and development
to improve the economics of electricity from solar and wind energy has
enabled these technologies to become financially competitive by a variety of
standards. For example, as battery prices have fallen, electric vehicles (EVs)
have become more competitive with gasoline-powered vehicles, a relatively
simple comparison. Although the larger transition to reduce greenhouse gas
emissions is in progress, many consumers have not yet made the transition
to electric bikes and EVs. Because of the costs of climate change and poor air
quality, there are presently good economic reasons to continue the transition
to renewable energy for electric power generation and to EVs for transportation. In large cities, there are also social and economic benefits associated
with the electrification of public transportation. The benefits of improving air
quality far exceed the costs.
11.1 Introduction
Economics is very often a consideration in decisions that are made about
greenhouse gas emissions and air quality, and so it is a very important topic
with respect to these issues. However, these issues can become thorny when
viewed through an economic lens, for several reasons. One reason is that
the scale of economic decisions regarding greenhouse gas emissions and air
quality so often involve immensely large numbers: Millions, billions, and
trillions of units (e.g. monetary costs and benefits, emissions, and subsidies).
Another reason is that these economic decisions often deal with phenomena
happening over large timescales: Years, decades, and even centuries. Finally,
there are thorny aspects in terms of the different types of costs and benefits;
some of the costs and benefits are personal and immediate to individuals (or
to organizations), whereas other costs and benefits are general, long term,
and spread across the population (see Chapter 15).
101
11
Economics
Abstract
Economic considerations impact many decisions relevant to reducing greenhouse gas emissions and improving air quality. Research and development
to improve the economics of electricity from solar and wind energy has
enabled these technologies to become financially competitive by a variety of
standards. For example, as battery prices have fallen, electric vehicles (EVs)
have become more competitive with gasoline-powered vehicles, a relatively
simple comparison. Although the larger transition to reduce greenhouse gas
emissions is in progress, many consumers have not yet made the transition
to electric bikes and EVs. Because of the costs of climate change and poor air
quality, there are presently good economic reasons to continue the transition
to renewable energy for electric power generation and to EVs for transportation. In large cities, there are also social and economic benefits associated
with the electrification of public transportation. The benefits of improving air
quality far exceed the costs.
11.1 Introduction
Economics is very often a consideration in decisions that are made about
greenhouse gas emissions and air quality, and so it is a very important topic
with respect to these issues. However, these issues can become thorny when
viewed through an economic lens, for several reasons. One reason is that
the scale of economic decisions regarding greenhouse gas emissions and air
quality so often involve immensely large numbers: Millions, billions, and
trillions of units (e.g. monetary costs and benefits, emissions, and subsidies).
Another reason is that these economic decisions often deal with phenomena
happening over large timescales: Years, decades, and even centuries. Finally,
there are thorny aspects in terms of the different types of costs and benefits;
some of the costs and benefits are personal and immediate to individuals (or
to organizations), whereas other costs and benefits are general, long term,
and spread across the population (see Chapter 15).