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SkS Analogy 24 - Atmospheric Carbon Loans

Posted on 26 October 2021 by Evan

Building or borrowing from our children’s future?

  • Unsustainable financing (i.e., debt) is often used to establish strong foundations.
  • Sustainable financing is used to maintain and build on strong foundations.

Borrowing money to finance one’s lifestyle is unsustainable. But debt can be an important component of establishing personal, corporate, or civil foundations. Debt is a temporary financial vehicle to be replaced by sustainable income to either manage the debt at some level, or to pay it back. Continued borrowing to finance an established lifestyle, corporation, or country is unwise and can lead to bankruptcy.

We enjoy a phenomenal, modern lifestyle, because over millions of years Earth prepared for us ample supplies of readily available natural supplies that we’ve used to establish the foundations of modern civilization. But just as we transition from temporary loans to sustainable income to finance our personal, corporate, and civil financial systems, so too, we must transition our energy systems away from fossil fuels to sustainable systems that do not alter the ecosystems on which we depend. Although fossil fuels played a fundamental role in establishing modern society, their use comes with a price.

Let’s illustrate this situation by alluding to a carbon loan, where we define a single carbon loan as the fossil-fuel consumption that leads to a 50 ppm CO2 build-up in the atmosphere.1 Part of the terms of the loan is a promise that we will remove the borrowed 50-ppm CO2 within 30 years of the end of the loan. The end of the loan is defined as the point at which we’ve added 50 ppm CO2 to the atmosphere. Repaying the loan means removing the carbon from the atmosphere using proper agricultural management (such as planting trees that absorb carbon) and Negative Emissions Technologies (NET).

The penalty for defaulting on the loan and not removing the borrowed 50-ppm from the atmosphere is that the temperature of the Earth rises by 0.5°C. Temperature rise triggers additional penalties (i.e., carbon feedbacks), manifested as additional CO2 that we must either remove, or allow to further raise Earth’s temperature.

Temperature rise associated with defaulted carbon loans causes climate change, sea level rise, and other detrimental effects, all of which undo the goal of the loan of building a solid foundation.

The carbon we put into the atmosphere is therefore like a loan with a balloon payment after many years: the costs in the early years of the loan are small, and become large towards the end of the loan. This is a simplification of reality, but conveys the essence of the delay between cause and effect, and emphasizes that the real costs of a carbon loan are not realized until much later than when we receive the benefits.

Consider the following timeline of our carbon loans, with the year and associated atmospheric CO2 concentration. Assuming an Equilibrium Climate Sensitivity (ECS) of 3°C/doubling CO2, and assuming that CO2 continues increasing into the near future at the 2020 rate of about 2.5 ppm/yr:

1820: 280 ppm CO2. Start of the Industrial Revolution.   
1910: 300 ppm: Assume the first 20 ppm CO2 was a gift and not a loan to be repaid.  
1985: 350 ppm: 1st 50 ppm loan received in full; balloon payment due in 2015.
2015: 400 ppm: 2nd 50 ppm loan received in full. First loan in default, Earth warmed to 1°C.
2020: 415 ppm: 1/3 of 3rd 50-ppm loan already received.
2035: 450 ppm: 3rd 50-ppm loan received in full.2
2045: Balloon payment for 2nd loan due. Default means warming to 1.5°C.
2065: Balloon payment for 3rd loan due. Default means warming to 2.0°C.

To keep the warming to 1.5°C or below, in accordance with the 2015 Paris Accord, planners assume we will take out a third carbon loan, that we will default on the second loan, but that using NET we will pay back the third loan before its balloon payment is due. We are therefore accepting our inability to pay back the second loan, and are settling for the best we can do is to limit warming to 1.5°C. Is this realistic?

NET is the technology that we’re relying on to make our balloon payments for the carbon loans. The plan is that we get the benefit of burning fossil fuels now, accept the CO2 buildup from the associated emissions, and use part of the fossil-fuel energy to build systems that we will use to suck carbon out of the atmosphere before the balloon payment is due. This plan assumes ...

  • We develop NET technology now to deploy later.
  • We muster the public support to finance and deploy NET technology at a scale that can remove everything we emit now, plus carbon added by any feedback mechanisms.
  • We don’t take out a fourth loan, because that is likely to overwhelm our efforts to pay back the carbon debt incurred by the third and “final” loan.

Considering that we are making plans now for how we will emit and then remove carbon over the next 50 years or so, we further assume that nature does not emit carbon in response to the warming we’ve caused that overwhelms our efforts to pay back our carbon debt.

A sustainable method for running society is to use fossil fuels only to establish a strong foundation, and then to switch to sustainable, renewable-energy sources. This still leaves us with the environmental penalties of the use of limited fossil fuels. Because a modern society will continue to emit some carbon into the atmosphere, we should only use small carbon loans to build a resilient, financially stable system, and then use part of our wealth to operate NET and other systems to repay the carbon loans.

This is how it should work if we want to maintain a stable climate and sea level.


1. Earth reabsorbs about 50% our carbon emissions. This is why we define the carbon loan as that equivalent to a 50 ppm CO2 buildup in the atmosphere, and why we do not equate the loan directly to CO2 emissions.
2. This is a Business-As-Usual projection, with CO2 accumulating between 2021 and 2040 at about the same rate as from 2015 to 2021. Depending on actions taken by countries to curb CO2 emissions, the date when this loan is received in full could be pushed back. On the other hand, if countries do not follow through on their commitments, the date when this loan is received in full could be brought forward.

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Comments 1 to 8:

  1. This can be a big picture metaphor that helps folks understand the issue, but it has oversimplified the issue considerably by seeing the carbon emissions and removal as a kind of loan and repayment. For instance the Negative Emissions Technologies include a very unsettled range of protocols that are highly speculative, have a wide range of social, financial, political and ethical consequences, some of which is explored here: as just one example. There is some question about how the impacts of some NETs could have adverse impacts on global ecosystems almost as great as the problem it is supposed to solve. Finally, the financial barriers to large scale implementations of NETs is explored here: leaving in question the viability of large scale deployment of many of these technologies, let alone the sustainability of doing so for very long.

    In other words, to oversimplify, if NETs is seen merely as a carbon cash source for paying off the carbon debt, this is akin to accepting bank robberies, drug sales, kidnapping, bogus investment and Ponzi schemes as viable carbon cash sources for the repayment of our carbon debt.

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  2. wilddouglascounty@1 Can't argue with your logic. Analogies usually have shortcomings, and this one is no exception. What I was trying to get people to understand is the delay between cause and effect. Another message was not to villify past fossil-fuel use, but to note that we need to move on to more sustainable energy use. I share your reservations about the use of NET, but because NET is a central component of current IPCC models, I thought it good to put them in perspective, in the sense that they are being proposed as a method to pay off our "debt".

    But I agree with your reservations about NET.

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  3. "Unsustainable financing (i.e., debt) is often used to establish strong foundations."

    Strange choice of words. Its not clear why debt is considered unsustainable. Surely debt that is prudent, and time limited, and builds useful things is sustainable? In fact the rest of the article seemed to suggest this. However the overall analogy seems quite good to me.

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  4. No one, (on this thread), has yet pointed out that fossil fuels are probably the lesser troublesome contributor to global warming. The ecological damage and apparent adverse climate change generated by fossil fuel-burning is small compared to Industrial Animal Agriculture's contribution.  There is a study, currently under peer review, that purports to show that Industrial Animal Agriculture contributes betweeen 19.2 and 30% of global GGEs.  Similar evidence has been published before about Industrial Animal Agriculture's impact on the environment, including descriptions of other crucial climate disruptors like excessive water use, domination of arable lands for livestock feed and maintenenace versus plant food production for humans, eutrophication of the oceans, waste stream contamination of municipal potable water supplies, broadcasting of endocrine disruptors, antibiotics, hazardous chemicals...the list goes on.

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  5. It might also be said that global outlawing of Industrial Animal Agriculture is much easier than eliminating fossil fuels, since the human diet would not suffer from the elimination of animal flesh, while the loss of fossil fuels as an energy source probably demands considerable and wrenching changes in energy production technologies.  What would NET look like if aimed at Industrial Animal Agriculture rather than fossil fuels?? (or aimed at both?)

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  6. swampfoxh@5 Professor Kevin Anderson has some opinions worth considering on this subject. In his opinion, NET cannot offset our fossil-fuel carbon emissions, but maybe able to offset our agricultural-based emissions. Here is an interview with Kevin Anderson worth watching. Quite simply, it is very unlikely that NET will ever allow us to safely continue to burn fossil fuels as we currently are.

    Kevin Anderson Interview

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  7. The kinds of food you eat have from little to nothing to do with Anthropogenic Global Warming (AGW) caused climate change, one way or the other. Rather, how and where what you eat is produced  would have a much bigger impact. In fact being vegetarian worldwide could even be counterproductive in the fight to end climate change.

    The reason for the confusion is what they call a “life cycle assessment” in calculating carbon footprints.

    Product Life Cycle Accounting and Reporting Standard: This standard involves understanding GHG emissions related to a specific product, based on raw materials used, production, distribution, and disposal. [1]

    Just to simplify things a little, lets break down the carbon footprint of a tomato.[2]

    The primary importance in calculating tomato carbon footprints depend on the season and the type of production system as well as transportation, storage and refrigeration.

    Basically you figure out the amount of fossil fuels used in the chain of supply from the farmer to the fresh market. Greenhouses need heated in winter, and cooled in summer. The fertilizer used could possibly be made from haber process nitrogen[3] which is made from Natural gas. Trucks deliver the tomatoes to markets and burn fossil fuels to get there. The market probably uses electricity made from fossil fuels to keep the air the ideal temp for storage and prevent them from spoiling. All of these factors added up together give us a quantified idea of the total fossil fuels used and a carbon footprint is calculated for each pound of tomatoes. Basically the tomato itself, like all food, has no global warming effect at all, but all the other things like fertilizers, production, distribution, and storage do!

    So how do we fix this?

    Well starting with fertilizers. Instead of haber process nitrogen used to make NPK fertilizers, we could use natural fertilizers like compost and manure. That would greatly reduce the carbon footprint of food production worldwide. Geothermal and solar heated and cooled greenhouses eliminate the need for fossil fuel use in out of season tomatoes.

    Next is location. The backyard grown garden tomato has no transportation needed. A local organic farmer might have some fuel costs to drive to the local farmers market, but minimal if a close neighbor. Also electric vehicles, powered by electricity produced by hydroelectric, wind, solar, nuclear, have almost no carbon footprint. So transportation improvements and shopping local or growing a garden can reduce the tomato carbon footprint a lot. If you need a fresh tomato out of season, make sure the greenhouse growing the tomato is local. If it is an organic, geothermal heated, local greenhouse produced tomato, all the better!

    One thing typically not included in calculating the carbon footprint of a tomato is soil carbon. It should be, but isn’t typically included because data is limited. Certain production methods (mostly organic and permaculture methods) have been shown to improve soil carbon dramatically. This soil carbon would need to be subtracted off the emissions side of tomato production. It is theoretically possible then to produce a tomato that has a negative carbon footprint, as long as the production method increases soil carbon more than the emissions caused by fertilizers, production, distribution, and storage.

    Soils from organic farms had 26 percent more potential for long-term carbon storage than soils from conventional farms, along with 13 percent more soil organic matter (SOM).[4]

    Better data would be needed to actually calculate carbon footprints based on soil carbon. But it is clear that some farmers have been able increase the carbon in their soils, and as long as the other side is not too high by using some of the above solutions to reduce emissions, we should be capable of mass producing tomatoes with negative carbon footprints! We are not now, not at any scale to speak of at least. But we potentially could!

    Being a vegetarian could in fact be quite helpful in mitigating climate change, as long as the vegetables were fertilized, produced, distributed, and stored in these improved ways! Every bite you took of vegetables you eat could actually by a tiny amount mitigate climate changes caused by us humans! Not a lot mind you, but there are billions of people on this planet, and if enough of them did this, a little multiplied by billions of bites could indeed add up to a big improvement!

    What about meat?

    There is one thing that needs addressed though. Meat production is very similar to the above. Carbon footprints of meat production are all life cycle calculations as well! Most the carbon footprint for animal foods also lies in production, distribution, and storage! However, if what we feed a chicken or a cow etc has a positive carbon footprint, and the animal eats lots of that food to grow itself, then the carbon footprint becomes multiplied by how much food it eats![5] Some animals can actually eat so much that their feed conversion is as much as 10x! Certain industrialized production methods for meat production can have insanely huge life cycle assessment carbon footprints for this reason, as much as ten times higher than vegetable carbon footprints. That’s why you see so many campaigns to reduce meat consumption in the media these days. Keep in mind though, these are also life cycle assessments. The meat itself is carbon neutral or close to it, it's the fossil fuels used in production mainly to blame for the multiplied effect.

    “The number one public enemy is the cow. But the number one tool that can save mankind is the cow. We need every cow we can get back out on the range. It is almost criminal to have them in feedlots which are inhumane, antisocial, and environmentally and economically unsound.” Allan Savory

    But here is the nuance. If what we fed those animals had a negative life cycle assessment of carbon footprint for the feed we gave it, then we would be multiplying that number by as much as 10x too! So in theory we could produce animal foods with as much as ten times better NEGATIVE carbon footprints as vegetable foods! And by the way, people are doing that right now in fact. There actually are farmers raising both crops and animals with such improved NEGATIVE carbon footprints.

    Why pasture cropping is such a Big Deal - Milkwood
    Pasture cropping allows cereal or grain crops to be sown directly into perennial native pastures and have them grow in symbiosis with the pasture.

    So you see? It's not the food, it's how that food is produced and distributed.

    “Yes, agriculture done improperly can definitely be a problem, but agriculture done in a proper way is an important solution to environmental issues including climate change, water issues, and biodiversity.”-Rattan Lal

    In that potential future case where all our future foods are produced, distributed and stored properly, then a vegetarian would not be helping end human caused climate change as much as a standard diet. But right now, that future does not exist. Right now being vegetarian does indeed help! However, changing the entire worlds dietary habits would seem to be much harder than just raising our food better to begin with! We had made that effort to produce the so called "green revolution" and that worked. We could do the exact same strategy again, this time emphasizing reducing carbon footprints in agriculture.  It could work. And without the obvious dead end that simply forcing the world to become vegetarian has.

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  8. RedBaron,

    Great presentation regarding the "Production and delivery of what we consume" being an important part of the problem to be addressed. But there is more to consider than the Carbon impacts.

    The Planetary Boundaries concept and understanding of impacts of human activity exposes many other important considerations.

    One important point is the need to reduce consumption, especially reducing consumption of higher impacting things. And more holistic evaluations of all impacts help identify the "bigger bang for the buck" alternatives to reduce consumption of.

    A related important understanding is that richer people should be less harmful, leading by example. Being richer is a privilege to lead by example. It does not confer the "Right to be more harmful because a richer person can afford it". Richer people should be the ones who are most supportive of more expensive less harmful ways of producing things.

    An example:

    It is clear that free-range grazing cattle raising can be beneficial from a Carbon perspective. But clearing rain forest, or any forest, to expand grazing ranges for cattle is not helpful. And there are other impacts to consider.

    Richer people should be the most aware. They should be rejecting and resisting activity that is more harmful and less helpful even if the more harmful less helpful ways are more popular and more profitable. The rich can still eat beef, but smaller portions less frequently. And the richest should only eat the least harmfully produced beef - to prove that they are truly superior to Others, truly deserving to be the richest.

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