Carbon dioxide (CO2) is a naturally occurring gas that is vital to life on earth. Carbon dioxide exists in our atmosphere as a trace element of about 400 ppm (parts per million). It is part of the Earth’s ‘carbon cycle’. It is produced by plants (photosynthesis), produced by animals (a product of respiration) and by combustion of wood, coal, petroleum and so forth.
Carbon dioxide is one of a number of greenhouse gas. Greenhouse gases are those gases in our atmosphere that absorb infrared radiation and therefore trap heat in the atmosphere. As the amount of heat increases in the atmosphere, this leads to the greenhouse effect, and ultimately global warming. Greenhouse gasses include water vapour, carbon dioxide, methane, ozone, nitrous oxide and chlorofluorocarbons (CFCs).
Human activities are altering the carbon cycle by adding more carbon dioxide to the atmosphere, and by reducing the capacity of natural ‘carbon sinks’ such as forests to remove CO2 from the atmosphere. The main activities that add carbon dioxide to the atmosphere are the combustion of fossil fuels for electricity generation (coal, oil, natural gas), for transportation (planes, trains and automobiles) and industry (industrial production processes requiring combustion of fossil fuels).
Approximately 32 billion tonnes of CO2 were released into the atmosphere last year alone, a third of which was attributable to electricity generation, a third to transport, and a third to industry, residential and everything else.
The amount of carbon dioxide in the atmosphere in the atmosphere has increased from 310 to 400 p.p.m. since 1960, that is 27% over the last 55 years. Over that same period global temperature anomaly – that is how much warmer or cooler the temperature has got in relation to the expected long term average – has increased some 0.8 degrees over the same time period. In crude terms, we could expect global temperatures to increase 1° C per additional 100 p.p.m. of carbon dioxide present in the atmosphere. And that global warming might increase another 1 degree over the next 50 or so years.
So why is this bad? The Earth’s atmosphere – and our dependent biosphere! – is somewhat a balancing act. When the atmosphere absorbs energy from the sun, the Earth warms. When the atmosphere reflects energy from the sun, it doesn’t. The more carbon dioxide that is present in the atmosphere, the more energy can be trapped in the atmosphere by that CO2. This extra energy contributes to global warming. And once the CO2 is in the atmosphere it stays there indefinitely.
The effects of increased levels of carbon dioxide and associated climate change are manyfold. Melting of polar ice caps and glaciers result in rising sea levels (an estimated 18 to 59 centimetres by the end of the century), and the reduced ability to reflect the suns energy. Associated disruptions to weather patterns will cause more extreme weather events. Hurricanes and other storms will be more severe. Both floods and droughts will become more commonplace. Ecosystems will change. CO2 is also causing the oceans to become more acidic, destroying coral reefs and upsetting the ocean balance. The symbiosis and dependencies between various flora and fauna may fall out of sync, for example flowering plants and pollenating insects not be active at the same time.
Find out how PAL’s new science based approach to placing a dollar cost on each tonne of carbon dioxide emitted could be just the enabler needed for the UN to finally agree a deal on a global carbon price.
Author: Edward Coe
Edward Coe is Managing Director and co-founder of PAL. He has extensive experience of systems development and implementation for advanced derivative trading systems utilising a broad range of technologies supporting in house, bespoke and third party software. Edward developed the software behind PAL Carbon.