Economic prospects of ocean iron fertilization in an international carbon market.

Rickels, Wilfried, Rehdanz, Katrin and Oschlies, Andreas (2012) Economic prospects of ocean iron fertilization in an international carbon market. Resource and Energy Economics, 34 (1). pp. 129-150. DOI 10.1016/j.reseneeco.2011.04.003.

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Abstract

Staying within the 2 ° C temperature increase target for climate change requires for ambitious emission reduction targets for the 2012–2020 compliance period. Cost-efficiency is a crucial criterion for the achievement of such targets, requiring analyses of all possible options. Enhancing the oceanic carbon sink via ocean iron fertilization (OIF) provides such an option. Our analysis reveals that the critical unit costs per net ton of CO2 sequestered by OIF range from 22 to 28 USD (price level 2000) in a post-Kyoto compliance scenario. The critical unit costs are defined as those that would make an emitter indifferent between various abatement options. With reference to hypothetical short-term large-scale Southern Ocean OIF we are able to show that seven years of OIF provide a number of credits exceeding those obtainable from global forestation projects lasting 20 years. From an economic perspective, our results indicate that OIF can be considered a potentially viable carbon-removal option. However, further research is needed, especially on adverse side-effects and their ecological and economical consequences.
Highlights:
► We analyse a potential large-scale carbon-removal option: ocean iron fertilization. ► We consider market conditions for OIF in a post-Kyoto climate regime. ► We determine the critical unit costs and the critical amounts for OIF. ► OIF may provide new incentives for the negotiation process in further climate agreements. ► Our results lead us to believe that further research on the potential of OIF is warranted.

Document Type: Article
Keywords: Climatology; Biogeochemistry; Climate change; Climate engineering; Ocean iron fertilization; CO2 market; Emission trading
Research affiliation: OceanRep > GEOMAR > FB2 Marine Biogeochemistry > FB2-BM Biogeochemical Modeling
OceanRep > The Future Ocean - Cluster of Excellence
Kiel University
Refereed: Yes
Open Access Journal?: No
DOI etc.: 10.1016/j.reseneeco.2011.04.003
ISSN: 0928-7655
Projects: Future Ocean
Date Deposited: 20 Dec 2011 09:01
Last Modified: 03 Apr 2017 14:12
URI: http://oceanrep.geomar.de/id/eprint/13084

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