VALUING THE IMPACT OF CO2 EMISSIONS

Valuing the impacts of CO2 emissions to the atmosphere has been widely debated, with various studies suggesting very different costs when ex pressed in units of dollar per tonne of carbon emitted, There are many complex issues involved, and it is often difficult to determine the r easons for the wide range of costs proposed, In this paper, models bas ed on two very different approaches, the PAGE and Intera models, are c onsidered, By applying these models to calculating the marginal impact of CO2 emissions it is shown that what appear initially to be diverge nt estimates can be reconciled, This process illustrates some of the k ey issues in this area, and a perspective is provided on which margina l costs are appropriate for different policy decisions.