Rules and Strategies for the CC Game

Rules:
  1. Enter a Carbon Price (CP) and a Green-Fund tax rate (GF), for each year 2010 -- 2110 (101 "moves").
    • If you have a low-emission country skip the Green-Fund tax, it won't work.
  2. Enter future moves any time. Change them any time until they are locked in.
  3. Move 2010 will be locked at the end of the first day, move 2011 at the end of the 2nd, etc.
  4. The object of the game is to maximize your total 101-year score, your "Final" score.
  5. The object is not to do better than other players. Getting a score of 1000 and coming in 3rd is better than 500 and first place.

Scoring:

  1. Your score is how much richer your country is ($B) than under business as usual (BAU).
  2. BAU climate means every country's climate policy is $0 in every year.
  3. What makes your score go up?
    • A better global climate.
    • Green Fund payments (if you are a low-emission country.
  4. What makes your score go down?
    • The cost of emission abatement due to your carbon tax.
    • The cost of Green-Fund taxes (used to pay low-emission countries).
  5. Does a $1 cost or benefit in 2100 count the same as $1 in 2010?
    • No, it counts far less.
    • The discount rate is 4%, so $1.00 in 2011 counts as $0.96 for your score.
    • $1.00 in 2110 counts as $0.02. But, don't be fooled, climate costs can be high in 2110.
What the Data Columns Mean in Player Pages (Plr1, Plr2, ... )
  1. Date: The two moves in this row will be locked in at around midnight of this date.
  2. Year: The year that this row simulates.
  3. Policy Moves:
  4. Carbon Price: Your #1 climate policy. The price you set on carbon (with a tax or cap-and-trade). This reduces your emissions by 25% if you set a $30 carbon price.
  5. The Green Fund: Your #2 climate policy. It pays countries that emit less than they would if they had average per-capita emissions (if any country has donated money to the Green Fund). Setting this to $2 places an extra $2 tax on carbon in your country. That goes to the international Green Fund, but it only taxes above-average carbon emissions. So if your emissions are below average, your Green-Fund policy variable has no effect.
  • Proposed New Green-Fund Payment Rule: Low-emission countries are paid in proportion to their below-average emissions AND in proportion to their carbon price.  So if country X emits 10 tons less than if it had average per-capita emissions and country Y emits 20 tons less, but country X has a carbon price of $20 and country Y only $5, then country X will get twice the Green Funds because $20x10 is twice $5x20.
    Information:
  1. "As of" Predicted Score: Your score As of each year. E.g. Row 10 (2014) shows how many $B of climate benefit minus policy cost your country will experience through 2014 if everyone plays as they have indicated. For past years this value is locked in, but for future years it will change as player update their policies.
  2. Emissions per Capita: How much carbon dioxide (CO2) an average citizen of your country emits. You can see the world average on the "Game" page. This to determine what your Green-Fund policy variable does (see Green Fund).
  3. Climate BAU Cost: Business as usual (BAU) means all countries have zero carbon tax and zero Green-Fund tax. This is what climate change would cost your country with BAU. For every $B less the climate costs your country you get 1 point.
  4. Abatement Cost: This is the cost of buying insulation, hybrid cars, and the inconvenience cost of putting on a sweater or walking to work. A carbon tax or cap collects money but this is not a net cost -- we don't throw that money away. Only doing things costs money.
  5. Green-Fund Cost: If you set a Green-Fund tax, this does cost your country money (but not the world) because this tax goes to low-emission countries (assuming your country has above-average emissions).
  6. Climate Benefit: The reduction in climate costs to your country caused by all climate policies.
  7. Green-Fund Benefit: Green funds that you receive if your country has below average emissions and some other country contributes to the Green Fund. This is proportional to how much less you emit than you would have emitted with average per-capita emissions. If you get Green Funds and lower your emissions, you will get more.
  8. Optimal Final Score: The score you would receive if every country adopted the climate policy that maximized the world's total score = (Total climate cost reduction) minus (Total cost of climate policies). This "Optimal Final Score" also assume there are no Green-Fund payments. So in reality, scores would likely be different, even with the best policy.
  9. Discounted Net Benefits: Each year you have a net benefit = (climate improvement from BAU) minus (This years cost of abatement and any Green Funds payments, plus or minus). That net benefit is discounted back to 2010 with a 4% discount rate. Then it is scaled to your country's population. For example if the discounted net benefit is $10/capita, and you population is 0.3 billion (like the U.S.) then that year's discounted net benefit is $3B.
Strategy
  1. If others set their CP higher it will help you. Try to get the others to agree to help each other by setting high CPs. 
  2. Pretend that you will also set your CP high if they do. 
  3. If you are a high emission country, tell low emission countries that you will contribute to the Green Fund if they set a high CP. Tell them that you will organize $100 billion per year by 2020 (as we did in Copenhagen). 
  4. If you are a low emission country, tell the others you will keep CP = 0 unless they make big contributions to the Green Fund. Demand they cut emissions by 45% by 2020 (as they did in Copenhagen). 
  5. If these strategies work about like the Copenhagen Summit, then try the following. 
  6. Come up with a binding international agreement that includes simple rules for how players will set CP and GF.
Change the Game?
  1. I am considering an addition to the game, and would like player input. 
  2. We could add a treaty with two clauses to the game -- One for CP and one for GF. They might work like this. 
  3. Each player could set a value for a global carbon price, CP* and a global Green-Fund tax rate, GF*. 
  4. Everyone would have to sign the agreement to make it take effect. This would mean: 
  5. The lowest value entered for CP* would be binding -- The game would force everyone to set CP at least this high. 
  6. Same for the lowest value entered for GF*. 
  7. Should there be some way to unsign the agreement?
How Things Work
  1. Carbon Pricing: When you set a carbon price (CP) of $10 per ton, it cost you money (points) and it reduces emissions. 
    1. Cost is less than you think because all the money collected stays in your country.
    2. But it's not free because it makes people do thinks like insulate homes -- that costs money.
    3. The actual cost is roughly CP × (emission reduction) / 2.
    4. Emission reduction is assumed to be 25% when CP=$30/ton.
    5. A big play may emit 6 billion tons, so a $30 CP would reduce emissions 1.5 billion tons.
    6. The cost to your country would be $30 × (1.5 B) / 2 = $22.5 B / year.
    7. How much per day is that for a person living in the US (population = 308 million)?
    8. William Nordhaus the #1 climate-policy modeler uses a cost function of $20 for a 25% reduction.
  2. The Climate:
    1. Coming soon
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