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| Edited By: Nikhil M Ghanekar |Source: DNA |Updated: Feb 25, 2017, 12:19 PM IST
Michael Greenstone, is the Milton Friedman Professor in Economics and Director, Energy Policy Institute at the University of Chicago. Greenstone, who also served as chief economist in President Barack Obama’s Council of Economic Advisers, is currently working with the central and state governments to help industries curb air pollution using continuous emission monitoring. In an interview, Greenstone spoke about air pollution, climate change and President Donald Trump.
We are at the dawn of an era where we can move from policy made evidence making, where we announce the policy and simultaneously announce the evidence, to evidence based policy-making. This way, we can learn how the world works and use that to guide policy, so that it achieves its objectives.
I think we are at the dawn of that era due to several things; advances in computing, advances in access to data and a deep understanding of how to design experiments that can provide answers to critical energy and environment questions that people in India and other parts of the world are facing. I think there is one thing that is underappreciated about particulate matter. Given its consequences for life expectancy around the world, in my view it is the greatest current environmental threat to human well being around the planet. There are hundreds of billions of people who live with concentrations of particulate matter that are causing their lives to be shorter by several years.
I think the minister is right to question, there is always an important issue when results from one place apply to another, and the minister was right to question the studies conducted in the US or at places with relatively low levels of pollution, do they apply to India today. I haven’t read the studies. But my understanding, possibly incorrect, is that they are applying results, from the studies conducted in the US to the air pollution in India. They have not necessarily conducted those studies at the levels of pollution in India.
But, those studies that he (Dave) referred talked about mortality in India?
I haven’t read that study. But my understanding, possibly incorrect, is that they are applying results, from the studies conducted in the US to the air pollution in India. They have not necessarily conducted those studies at the levels of pollution in India. I have conducted some research in China, where the levels of pollution are roughly comparable. I think it's not unreasonable to try and apply the results from China to India. That work shows that is that particulate matter is an important threat to human well-being and high-concentrations are leading the Chinese to lead shorter and sicker lives. Extrapolating that to India may not be such a big bridge to cross.
Under the Make in India programme, the Modi-led government has given a big push for manufacturing, which China did two decades ago. They are facing the environmental consequences too. In that context, do you think India has enough safeguards in place and will we see similar consequences in India.
Industrialization has played an important role in pulling millions of people out of poverty. What’s different is, and here there is an opportunity for India, we now understand much better how to control pollution and in an inexpensive way. I would not view it as an either or situation. Rather, can one engage and foster the manufacturing industries, that have been successful in pulling people out of poverty in India, while also limiting the environmental consequences through nimble and market-based approaches and regulation. There is a tremendous opportunity in that, without having high levels of pollution. But, that will require robust enforcement of environmental laws.
The current government has set an ambitious target for increasing share of renewable energy as part of their climate goals, at the same time we will have more thermal plants. How do we reconcile with this, considering dependence on coal is not going to reduce soon?
Let’s start with energy consumption. It is very low in India at the moment and it is restraining economic growth. It is not allowing people to have living standards that hundreds and millions of people enjoy in other parts of the world and thus increasing access to inexpensive and reliable energy is an enormous priority. One wants it to be accomplished without imposing health problems and without increasing probability of disruptive climate change. There is a balancing act to be had there between low carbon sources of energy and their costs. The truth is, coal is a very inexpensive source of energy. But, it does impose large cost outside the market place via high levels of pollution, carbon emissions, that lead to climate change.
You worked closely with President Obama in the past and you did work in the past on climate change, when you talked about social costs of carbon emissions. What can India learn from that?
I worked on something called the social cost of carbon. It is the monetary damage associated with the release of an additional tonne of carbon dioxide into the atmosphere. Those damages accrue all over the world, not just limited to one country. A great challenge for the world is that by and large prices that people face for energy consumption do not reflect the full cost. These prices reflect how much it cost to produce a gallon of fuel but not the climate damages associated. The idea of the social cost of carbon is that we would all be better off if the prices we faced reflected the private and social costs, the carbon emissions, the health impacts, the particulate emissions.
How do you communicate it to the public at large?
There has not been a very successful effort to communicate what the cost of climate change is going to be. When the climate scientists talk about a 2 degree temperature rise, nobody really knows what that means. But, in practice, it is going to have highly consequences in our lives. Some countries are in a better position to withstand. My own sense is, India is not probably terribly well positioned. It is already a hot place and when it gets hotter, there will be problems with crop yields, mortality rates. Probably the best way to generate support for proper pricing of energy is to better communicate what the consequences of failing to do so are. Ultimately, we get the government and policy that we demand. If the public is not demanding it, the government is not going to deliver.
President Obama played a big role while adopting the Paris accord, although there was scepticism about US’ historical accountability. So tell us a bit about how his climate policy evolved?
I think, there was a big push made in 2009-10, to try and set up a cap and trade programme inside the United States and the hope was to take it to Copenhagen and bargain for a change in the policies of other countries. That kind of died in the US Senate and in Copenhagen too. Then, that opened a bunch of wounds and they had to heal for a while and the President had to run for re-election. But, in his second term, I think he was a visionary leader on climate. There was a narrow political path through which the US government could operate to make progress on climate. The President and his team really was remarkable in terms of policy and politics, they did a terrific job (on Paris accord). I think, when history gets written, that will go down as a time when the US became serious for the first time about climate change.
I think there is no question of increasing public demand for doing something about air pollution in India. It has not reached the levels that it did in China in 2013, but, it is not hard to reach there. Everyone in the world more or less gets the kind of government they want. Governments around the world have proven themselves to be up to the task when people demand it. The US team was really remarkable in terms of policy and politics, they did a terrific job (on Paris accord). I think, when history gets written, that will go down as a time when the US became serious for the first time about climate change.
I don’t think they will pull out of it. It’s like a 4d rubik’s cube challenge to try to get as much countries in the Paris deal and it will not be helpful for the US to pull out. Each country will to have to judge whether participating is better than not participating. The case for participating is always stronger when everybody else is. I am not a lawyer, but my understanding is it will be complicated to pull out. An easier thing to do would be to just not meet the promise.
