How to clean up

© The Economist, June 15, 1996.

Protecting the ozone layer may prove easier than curbing global warming.

Good news for sunbathers: the concentration of ozone-gobbling chemicals in the earth’s atmosphere fell last year by 1.5%, the first recorded decline since the invention of chlorofluorocarbons (CFCs).  CFCs nibble away at the layer of ozone that stops most harmful ultraviolet radiation from reaching the earth.  If countries stick to their agreement to phase out CFCs (production in the rich world ended in January), then by the middle of the next century the ozone layer should be restored to its pre-1970 density, and it will once again be (moderately) safe to go out in the midday sun.

That looks like a triumph for diplomacy and environmental treaty-making, and perhaps a sign of hope for the talks next month on implementing the 1992 climate-change treaty.  After all if CFCs can be negotiated away, so surely can “greenhouse” gases such as carbon dioxide, whose accumulation raises the planet’s temperature and alters its climate.  Indeed, it was the success of the Montreal protocol on ozone depletion that persuaded many countries that a climate-change treaty might work and lured the rich countries, at the 1992 Earth Summit, into promising plans to reduce their output of greenhouse gases to 1990 levels.  Alas, global carbon-dioxide output is still chugging upwards at more than 2% a year.  By 2015 it could be 50% higher than in 1990. 

In truth, the CFC agreement had special advantages.  Ozone thinning is easily measurable, which has convinced people that a real problem exists.  Measurement is far harder for climate change.  True, the four warmest years on record have all occurred in the 1990s, and nine of the ten warmest have been since 1980.  But furious disagreement surrounds claims by many scientists that there has already been a “discernible human influence” on the climate.

Another strength of the CFC treaty is that a depleted ozone layer increases the risk of skin cancer.  Governments always give priority to environmental threats to human health, and skin cancer has become a special scourge in the rich countries that are the main users of CFCs.  Climate change may also harm health for instance by spreading malaria.  But that disease rarely frightens the rich whose energy consumption is the main source of global-warming gases. 

The CFC agreement also had the energetic backing of the world’s main producers.  This small group of large chemical companies accepted the case for phasing out CFCs, and invested heavily in developing substitutes.  Because such substitutes are more costly and do not work as well as the originals, the best way to ensure a market for them was to ban rivals.  It is hard to imagine a surer way to lock up a new market than an international agreement backed by trade sanctions. 

Perhaps most significant of all, the cost of stopping CFC production is relatively low.  Some estimates for America, the biggest market, put it at no more than $1 billion-2 billion a year.  The existence of substitutes, some better than others, has helped to reduce the cost to users.  And as the effects of ozone depletion are entirely negative, the benefits should be large.

Burn, baby, burn

With climate change, nothing is quite so easy.  The cost of cutting carbon-dioxide output will be higher – in the case of America perhaps $30 billion a year initially, rising later to 1-2% of GDP.  Curbing the use of fossil fuels, the main man-made source of carbon dioxide, is tougher than doing without CFCs: the main substitute, nuclear power, has environmental problems of its own.  No group of big producers is willing to play the helpful role of the CFC makers.  And far from being wholly negative, climate change may actually be welcomed if it brings warmth to, say, Russia or Canada.

 Yet none of this means that greenhouse gas output cannot be curbed.  The best way would be to eliminate market distortions.  Many governments could do this and simultaneously cut their budget deficits, for instance by scrapping subsidies for coal mining or tax breaks for car commuters.  Britain, one of the few countries that has reduced carbon-dioxide output since 1990, did it by freeing its energy market: electricity generators have switched from high-carbon coal to low-carbon natural gas, and energy bills have fallen.  Even with greenhouse gases, a cleaner environment need not cost the earth.