Leaders from over 190 nations will convene next month in Paris in hopes of negotiating an agreement to mitigate climate change. Unfortunately, last week, China released information that will only complicate the already daunting negotiations process. Since 2000, China has emitted almost a billion tons of carbon more per year than previously reported. The revelation casts doubt on the abilities of government leaders to negotiate an effective agreement since countries may make nominal commitments but fail to report their true emissions rates going forward.

On the other hand, a recent poll conducted by the Pew Research Center found that the majority of constituents in 39 of 40 nations favored cutting greenhouse emissions. However, the poll also revealed significant disagreement over which countries should make the necessary sacrifices. Although developing countries will release the most greenhouse gas emissions in the future, only 38% of respondents believed they should shoulder an equal reductions burden as wealthier nations.

World leaders will bring similarly divergent opinions to Paris and consequently face a thorny collective action problem. Moreover, even an ambitious agreement to curtail emissions will create incentives for countries to free ride in the future. These complications cast doubt as to whether an international agreement is the best vehicle to mitigate the effects of climate change. Governments are not the only entities that can compel widespread global emissions reductions. Private corporations and individuals may be better suited to limit greenhouse gas emissions and mitigate the effects of climate change.

Some companies have already begun to play an active role in offsetting their carbon footprint. Microsoft, for example, has instituted an internal tax based on energy usage. Their environmental sustainability team calculates the amount of energy used throughout the company on everything from electricity in office spaces to air travel. The total gallons of fuel and kilowatt-hours of power are converted into metric tons of carbon. This year, Microsoft invested $20 million in solar panels, wind farms, and “green” upgrades to existing spaces to reduce power usage in the future. Each individual business unit within the company was then charged their portion of the bill based on how much energy it used. The company has reduced its emissions by the equivalent of 7.5 million metric tons of carbon over the last three years demonstrating the remarkable success of the program.

Environmentally concerned billionaires may also be better suited than leaders in Paris to limit future carbon emissions. In addition to instituting the internal carbon tax at Microsoft, Bill Gates has pledged to personally commit $2 billion towards research and development of sustainable energy sources. Some economists posit private individuals could have an even greater effect by buying up large amounts of the world’s coal reserves. Future emissions would thereby be limited and, theoretically, the price of coal would rise creating incentives to invest in cleaner energy sources.

Private individuals and companies could also offset emissions by investing in afforestation and contributing to disaster relief to stop emissions from forest fires. The private sector can also facilitate adaption efforts. A recent study revealed major cities in the Middle East, including Abu Dhabi and Dubai, may be too hot by 2100 for humans to survive without air conditioning. A study by a team at the London School of Economics has predicted between 665,000 and 1.7 million people in the Pacific alone will be forced to migrate by 2050 because of sea level rise. Private investors could significantly help avoid potential world crises by investing in infrastructure now.

Hopefully, leaders in Paris will be able to come to an agreement that greatly limits future carbon emissions and mitigates the inevitable effects of climate change. However, the solution to these problems may also lie in the hands of the private sector.

Katelyn Marshall

 

 

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