Dennis Anderson

Dennis Anderson is Emeritus Professor of Energy and Environmental Studies at Imperial College London. He was previously director of the College’s Centre for Energy Policy and Technology (ICEPT), an economist and later the Energy Adviser of the World Bank, Chief Economist of Shell and had earlier worked as an engineer and reactor physicist in the electricity supply industry. He provided advice to the Stern team on the technologies, costs, and policies for carbon abatement in the energy sector and wrote background papers on the subject.

Papers Published in World Economics:

Right for the Right Reasons

Four authors of the Stern Review on the Economics of Climate Change, and Dennis Anderson who provided advice and background papers for the Review, make a final rejoinder on the debate about the Review that has occupied recent issues of this journal. They respond to comments in the present issue by Carter et al., by Henderson, and by Tol and Yohe. Carter et al. continue to argue against a growing body of scientific evidence and a growing consensus on that same evidence. The source of their critique is, first, a distinctly partisan, and increasingly untenable, position on the broad range of available scientific evidence and, second, a mistrust of the international consensus-building exercise centred on the Intergovernmental Panel on Climate Change. Henderson is also largely preoccupied with the latter, procedural issues. Tol and Yohe focus on economic arguments. Their critique is rather narrower in focus and concerns the way in which abatement costs were calculated in the supporting work carried out by Dennis Anderson. It rests on basic confusions and misconceptions, many of which were explained in previous contributions. However, readers of World Economics might be more interested in a broader reflection: how would the Stern team, following the debate of the last eight months, assess the approach, policies and arguments set out in the Review? Their view is that their analyses and policy proposals, and the arguments in support, are sound and have stood up well to scrutiny. In other words, they were right and for the right reasons. Central to many critiques of the Review is a fundamental misunderstanding of the role of formal, highly aggregated economic modelling. Nevertheless, the Stern team have argued strongly and in their view convincingly that, even within the confines of formal economic modelling, the concerns raised by a small group of commentators do not overturn their basic conclusion that the cost of action is much less than the cost of inaction. The critics here fall short by failing to simultaneously afford the necessary importance to issues of risk and ethics.

Read Full Paper >

The Stern Review and the Costs of Climate Change Mitigation

Responding to the ‘Dual Critique’, and the Tol and Yohe paper in the previous issue of World Economics, Professor Anderson counters a number of assertions made in those papers including the claims that the Stern Review is ‘alarmist’ or scaremongering, biased in its estimates and was not reviewed by peers. He points to a number of areas where the authors either got it wrong or seriously misrepresented the Review.

Read Full Paper >

The Costs of Mitigating Climate Change

The paper reviews analyses of the costs of mitigating climate change and discusses the implications for policy. The estimated effects of reducing carbon emissions by 40%–60% over the next half century range from –1.0% to 4.5% of world product, averaging 2½%. This would be small in relation to the growth of economic output over the period, which is likely to be several hundred percent higher than it is today. The main reason why the estimated effect is small is innovation: a large number of carbon-neutral technologies and practices is available or emerging that are capable of significant further development. An initiative focussed on encouraging innovation and the diffusion of new energy technologies and practices across countries would provide a new direction for international cooperation based on already significant national policies in many countries.

Read Full Paper >

Technical Progress and Global Warming

The case is argued for a larger and more explicit role for technology policies in responding to climate change. Policies and institutions set up during the Cold War arms race could be reformed and redirected towards the goal of making renewable energy a viable competitor to carbon-emitting fuels. Putting more resources into such projects would not only reduce their cost through economies of scale and scope, but could raise the possibility of a technological shock which meant that the cost of transition to “non-net-carbon-emitting” technology could actually be negative. Anderson argues that in any case the transition costs would probably be small, and that the process would be to the advantage of developing countries, who typically have a five to one cost advantage over the developed world in non-carbon-emitting energy production.

Read Full Paper >