The impact of uncertainty on optimal emission policies
Journal article, 2018

We apply a computational framework for specifying and solving sequential decision problems to study the impact of three kinds of uncertainties on optimal emission policies in a stylized sequential emission problem. We find that uncertainties about the implementability of decisions on emission reductions (or increases) have a greater impact on optimal policies than uncertainties about the availability of effective emission reduction technologies and uncertainties about the implications of trespassing critical cumulated emission thresholds. The results show that uncertainties about the implementability of decisions on emission reductions (or increases) call for more precautionary policies. In other words, delaying emission reductions to the point in time when effective technologies will become available is suboptimal when these uncertainties are accounted for rigorously. By contrast, uncertainties about the implications of exceeding critical cumulated emission thresholds tend to make early emission reductions less rewarding.

Author

Nicola Botta

Potsdam Institute for Climate Impact Research

Patrik Jansson

Chalmers, Computer Science and Engineering (Chalmers), Functional Programming

Cezar Ionescu

Chalmers, Computer Science and Engineering (Chalmers), Functional Programming

University of Oxford

Earth System Dynamics

2190-4979 (ISSN) 2190-4987 (eISSN)

Vol. 9 2 525-542

Areas of Advance

Information and Communication Technology

Energy

Driving Forces

Sustainable development

Roots

Basic sciences

Subject Categories

Software Engineering

Physical Geography

Environmental Sciences

DOI

10.5194/esd-9-525-2018

More information

Latest update

5/31/2018