Coping with the Scientific, Technological and Economic Uncertainties of Climate Change

The threat of climate change has profound implications for the evolution of the world's energy system over the coming decades. More than many environmental problems, uncertainty is a central characteristic of the problem – uncertainty regarding the physical science of climate but also uncertainty regarding the impacts, technologies (for mitigation, adaptation and geoengineering), costs, and human preferences.

The problem is larger than simple uncertainty. Some uncertainty is objective and fits into a probabilistic paradigm; other uncertainty is much more vague, with unknown probabilities (such as the likelihood of inventing a cheap way of storing electricity by 2020). Furthermore, uncertainty changes over time, either simply by acquiring more experience or through proactive measures to increase knowledge (eg, R&D). And further, some uncertainty is managed automatically by individuals and organizations seeking to reduce risk exposure (eg, with flood insurance). The bottom line is how to manage the risks of climate change in this complex and evolving environment? Insurance, financial markets, individual action and public policy can and should work in tandem to deal with this uncertainty. This talk provides a perspective on managing risk associated with climate change.

Speaker: Charles Kolstad, Stanford