Wharton's Steven Kimbrough and Carolyn Kousky and Penn Law's Cary Coglianese discuss the solutions offered by a new Penn-wide report on climate change.

Tackling climate change calls for action on dozens, if not hundreds or thousands, of fronts, from developing new government policies, to planting trees and educating consumers.

It’s a daunting task, but a new study attempts to boil all of those challenges down to just 30 “policy-relevant and solution-oriented” proposals that can be applied at the local, state and national levels.

The report – developed by Wharton’s Risk Management and Decision Processes Center, the Kleinman Center for Energy Policy, the Penn Program on Regulation, and the Penn Faculty Senate, a university body that gives representation to faculty voices on academic issues and other relevant matters – is a collection of ideas from experts that follows up on dire warnings that the United Nations Intergovernmental Panel on Climate Change issued last year. The U.N. body had warned of rising sea levels, drought, more damaging storms, coral reefs dying and famine, among other things, and it urged a more rapid transition to a carbon-free world.

The Knowledge at Wharton radio show on SiriusXM discussed some of the climate change solutions and major takeaways from the Penn report with Cary Coglianese, Penn law professor and political science professor and director of the Penn Program on Regulation; Steven O. Kimbrough, Wharton professor of operations, information and decisions, and Carolyn Kousky, executive director at the Wharton Risk Management and Decision Processes Center. (Listen to the podcast on at the top of this page.)

Three Risk Buckets

“Climate change is a risk management problem,” said Kousky. “Part of why it’s tricky is it’s actually not just one risk management problem, but hundreds of risk management problems.” The Risk Center classified those risks under the following “three big buckets” that called for appropriate climate policies:

  • Mitigation: How do we reduce emissions rapidly to minimize the risks of catastrophic shifts in earth systems?
  • Adaptation: How do we reduce the risks of physical climate impacts to households, communities and businesses?
  • Transition: How do we minimize the transition risks for businesses and communities as we shift to a carbon-free economy in the face of uncertainty?

The Risk Center reached out to scholars across Penn to propose solutions in any of those buckets, and the 30 proposals are the outcome of that effort. The project is ongoing, and plans are to publish more proposals as participants identify newer solutions to combat climate change.

A Lab for Living

Of the three big baskets of risks, the work of the Penn project is most significant in relation to minimizing risks in the transition phase to a carbon-free economy, according to Kimbrough. “It’s a laboratory for living, of figuring out new ways of living that better adapt us to the world,” he said. “This particular project is exemplary in furthering that dialogue and bringing it to people’s attention.”

“Climate change is a risk management problem. It’s not just one risk management problem, but hundreds of risk management problems.”–Carolyn Kousky

Kousky said the proposals put forth in the Penn project bring fresh promise to the “incredibly daunting” task of combating climate change. “There’s just so much that needs to be done and so many challenges with doing it,” she added. “But what you see when you look across these 30 solutions is that [they are] a source of optimism because we can start making changes almost everywhere, in every sector and at every scale.”

Coglianese noted that the number of actors responsible for climate change “vastly exceeds” that of any other environmental problem. “In fundamental ways, the problem stems from actions each of us takes to secure shelter, provide food and satisfy transportation needs,” he wrote in a coda that summarizes the 30 ideas. Climate change is therefore “a collective action problem on steroids,” he said.

While such collective action problems occur all the time in society, “we need legal institutions to help get people to do what’s right for the good of the whole, even though it’s not always in each individual’s self-interest,” Coglianese continued. “What makes it so challenging is that it is worldwide, and there aren’t global institutions that can readily come into play and correct those market failures that are occurring here on steroids.”

Solution-matching and Normative Shifts

One big challenge with tackling climate change is a “solution-matching problem,” Kimbrough said. “There are people who have problems and there are people who have expertise to solve those problems. How do you match them up?” he asked. “How do we identify the problems that the experts who specialize in climate change will identify, and how can they be articulated so that interested experts outside of climate change can understand that this is what they need to do?”

“What has to be done is convince people that it’s too expensive not to move forward. When they see that, they’ll change their values as well.”–Steven Kimbrough

Those outside experts would include students or just about anybody who is interested in contributing to climate change solutions, Kimbrough said. He noted that these views reflect those of the wider Penn faculty, whom he represents this year as the Faculty Senate chair. One approach that he thought would be useful to framing solutions is “agent-based modelling,” which is a form of simulation.

The fundamental need is for a “normative change” where society as a whole makes it abundantly clear that climate change is unacceptable, according to Coglianese. “We have to reach a point in which a critical mass, or a tipping point, is reached so that societies in the U.S. and around the world demand their government’s attention to this,” he said.

Coglianese drew attention to a paper in the Penn report by Penn Law professor Regina Austin, where she talks about how images are powerful in helping facilitate that normative change. “The images of the devastation of [Hurricane] Katrina spoke louder than words,” Austin wrote in her paper, citing research on Katrina and the government’s flawed response.

One of Austin’s recommendations on how to use imagery to advance the fight against climate change: “Expand the role of storytellers of all kinds, including not only ethnographers, sociologists, and philosophers, but also visual and literary artists, folklorists, documentary photographers and filmmakers, journalists and nonfiction writers.”

Paying the ‘Climate Tax’

In addition to normative change in how society perceives climate change, it is important that people realize the cost of inaction, said Kimbrough. “What has to be done is convince people that it’s too expensive not to move forward. And when they see that, they’ll change their values as well.”

While there is no shortage of “information or imagination” on how to address climate change, what is needed is the “impetus” to bring about that change, Coglianese wrote in his coda. “Industries and individuals with a stake in the status quo can be expected to resist the necessary changes,” he said. “[However], climate risk solutions will demand those who are contributing to the problem to ‘internalize their externalities,’ [which means] they must start paying costs to reduce the spillover harms they impose on those who suffer the ravages of climate change.”

“The U.S. already has a climate tax,” noted Coglianese, who along with Penn Law fellow Mark Nevitt wrote an op-ed article in The Washington Post earlier this year on that subject. “The tax, though, is the costs of the floods and the fires. It’s a tax that people are incurring already. It’s just distributed randomly and insensibly and tragically.” He added that those costs are borne by not just the current generation. “We’re also putting it on our children.”

However, attempts to penalize emitters with a carbon tax have always faced political hurdles, said Coglianese. “Anytime you call something a tax, it’s almost dead on arrival,” he said. Here, he pointed to an essay in the Penn report on that subject by Ioana Marinescu, professor at the Penn School of Social Policy and Practice and faculty research fellow at the National Bureau of Economic Research.

Kimbrough said a carbon tax is just one side of a coin. The other side is to explore whether alternatives to fossil fuels are cheaper. “You can do that by making the fossil fuels more expensive and/or the replacements cheaper. We need to focus very much on both.”

Next Steps: Innovation in Multiple Areas

Kousky hoped that a follow-on project could involve students. “We’ve seen enormous student interest in the topic of climate change in the summer program,” she said. “That speaks to the fact that [climate change] is the defining challenge for that generation.”

“We have to reach a point in which a critical mass, or a tipping point, is reached so that societies in the U.S. and around the world demand their government’s attention to this.”–Cary Coglianese

Coglianese pointed out that the transportation sector makes up about a quarter of greenhouse gas emissions in the U.S., including roads and materials used in them such as asphalt. That situation provides “enormous opportunities for Wharton students, and for engineering students, to start thinking about ways of innovating in transportation,” such as with road structures, autonomous vehicles, electric vehicles and so forth, he said. Kousky added airplanes to that list, noting that they are big emitters of greenhouse gases.

The housing sector, land development patterns and living patterns are other areas where fresh solutions will be needed. Coglianese said he expected climate-change effects to compel some U.S. communities to relocate, and pointed to regular flooding in Miami and other parts of coastal areas as examples.

Innovation around the pathways to a carbon-free world would also help. “Much of climate change is often sold as painful and difficult, and very unpleasant,” said Kimbrough. “It may well be true, but it’s incumbent upon us to be extremely creative and open-minded, and figure out new ways of doing things to make the transition as painless as possible.”

Other areas that constantly need innovation include reducing dependence on non-renewable sources of energy and boosting renewables such as solar power by finding ways to store such energy, said Coglianese.

Reducing greenhouse gas emissions is more important than reducing fossil fuel combustion, according to a paper in the Penn report by Mark Alan Hughes, professor of practice at Penn’s Weitzman School of Design and the founding faculty director of the Kleinman Center for Energy Policy. “Limiting the extraction and use of fossil fuels is not intrinsically necessary,” he wrote. “The instrumental means that matters more to our ultimate goal of surviving on earth is that we stop adding more greenhouse gases into the atmosphere.”

In that effort, Hughes emphasized the importance of “negative emissions” technologies that help in carbon capture and removal. “We need to think about ways of capturing the carbon, either at the source or through forestation or other ways of sequestering the carbon,” Coglianese said.

Work Cut Out for Three Audiences

The Penn project brings to bear cross-functional skills from across the university, noted Coglianese. He pointed to a proposal by Penn Law professor Howard F. Chang that explores how tariffs and international trade policy might be leveraged to help address climate change. He also pointed to an article by Nevitt, which advocates for a fresh look at regulatory restrictions that hamper climate control efforts.

Kousky identified to-do plans for “three audiences” for the Penn report. One is to drive collaborations between schools and scholars within the university to find climate solutions. The second is to inform public policy and the changes that would be necessary at all levels of government. The third is to work closely with the private sector in tackling climate change. On that last aspect, Coglianese called attention to a paper by Eric Orts, Wharton professor of legal studies and business ethics and faculty director of the Initiative for Global Environmental Leadership. In that paper, Orts makes a case for businesses to “get political” about climate change and “come together to counter the influence of reactionary business forces.”