A Comparison of Two Approaches for Damage Evaluation on Optimal Mitigation and Adaptation Responses in China

Abstract

Climate policies making are strongly impacted by the approach of damage evaluation. China is leading carbon dioxide (CO₂) emissions in the world, and has agreed with Paris agreement to reduce CO₂ emissions. China is also expected to be negatively impacted by climate change. One of main concerns is how to assess and monetize the climate damage from country-specific level. This paper builds a model comprising two approaches of damage evaluation and assesses China’s mitigation and adaptation responses by 2100 for both of no policy and Paris agreement policy. It has the following findings: First, the emissions pathway and nonfossil fuel consumption share of total energy consumption differs slightly between the two approaches of damage evaluation. Second, with the Burkes approach, the climate damage avoided by adaptation is increasingly higher than that by mitigation when investment in adaptation starts to be massively injected with faster increasing trend by 2045. Third, climate expenses should be invested more to address higher level of the climate damage evaluated by the Burkes approach than by the Mannes approach. Fourth, the main findings in this paper are robust in terms of uncertainties in the parameters of damage function.