Exhibit 3 to Declaration of Julia A. Olson
National Petrochemical & Refiners Association 1899 L Street, NW

Suite 1000

Washington, DC

20036.3896

202.457.0480 voice 

202.429.7726 fax 

www.npra.org

International Petrochemical Conference 

March 25-27, 2007 

Convention Center 

San Antonio, Texas 

IPC-07-72 Climate Change 

Problem But Not Top Priority 

Presented By: 

Name 

Title 

Company 

Location

Bjorn Lomborg 

Adjunct Professor 

Copenhagen Business School 

Copenhagen, Denmark 
This paper has been reproduced for the author or authors as a courtesy by the National 

Petrochemical & Refiners Association. Publication of this paper does not signify that the 

contents necessarily reflect the opinions of the NPRA, its officers, directors, members, or staff. 

Requests for authorization to quote or use the contents should be addressed directly to the 

author(s) 
Climate change Climate change

Problem, but not top priority Problem, but not top priority

Bjørn Lomborg Bjørn Lomborg

www.lomborg.com
Two important points Two important points

 Remove our myths Remove our myths

– Doomsday is not nigh Doomsday is not nigh– Thus, we don’t have to act in desperation Thus, we don’t have to act in desperation

 Essential information necessary to make Essential information necessary to make 

the best possible decisions the best possible decisions 

– There is only one bag of money but many There is only one bag of money but many 

good uses good uses

1
Are things really getting better? Are things really getting better?

 We have more leisure time, greater We have more leisure time, greater 

security and fewer accidents, more security and fewer accidents, more education, more amenities, higher education, more amenities, higher incomes, fewer starving, more food incomes, fewer starving, more food and a healthier and longer life. and a healthier and longer life.

– Both for the industrialized and Both for the industrialized and 

developing world developing world

2
Calories for developed and Calories for developed and 

developing countries, 1961 developing countries, 1961

-2050

FAO 2007 FAO 2007

3,6003,4003,2003,0002,8002,6002,4002,2002,0001,800

1960 1980 2000 2020 2040

Calories per day per capitaDeveloped

Developing

World

3
Are things really getting better? II Are things really getting better? II

 At the same time, the environmental load in At the same time, the environmental load in 

many of the important areas has decreased: many of the important areas has decreased:

– air– water

 And in general we need to focus on the costs And in general we need to focus on the costs 

and advantages: and advantages:

– our chemical fears, e.g. pesticides our chemical fears, e.g. pesticides – global warming global warming

4
We believe things are bad We believe things are bad

 Where are Where are 

we worried? we worried?

0

908070605040302010

100

water air

worried in percent

localnational

5
Why so much bad news? Why so much bad news?

 Research Research

– built

-in bias in bias

 Interest Organizations Interest Organizations

– argue for a specific case argue for a specific case

 Media

– single issue single issue– bad news sells better bad news sells better

6
Resources Resources

- are there enough to support our future? are there enough to support our future?

7
Oil, Consumption Time Oil, Consumption Time

Simon et al. 1994 & EIA 1997, 1999, 2000 Simon et al. 1994 & EIA 1997, 1999, 2000

50

504540353025201510

1920 1930 1940 1950 1960 1970 1980 1990 2000

Years of consumption

8
Prices on Raw Materials, Prices on Raw Materials, 

1845

-2000

Economist 2001 Economist 2001

65432

1

0

1840 1880 1920 1960 2000

9
Pollution Pollution

- are we undermining welfare? are we undermining welfare?

10
Particles and SO Particles and SO2 in London, in London, 

1585-1997

Brimblecombe Brimblecombe 1977, Laxen & Thomsen 1987, & Thomsen 1987, Elsom 1997, OECD 1999 1997, OECD 1999

SO2

Smoke

0

900800700600500400300200100

1000

1550 1600 1650 1700 1750 1800 1850 1900 1950 2000

g/m

μ, 

2 Smoke and SO

3

Particles

SO2

11
And the developing world? And the developing world?

 Pollution has a Pollution has a 

tendency to get first tendency to get first worse with worse with economic growth, economic growth, then better then better

 Thus, both growth 

and environment and environment

0

80604020

120100

100 1000 10000 100000

Income per capita, 1985 PPP$

1972

1986

World Bank 1992, World Bank 1992, Shafik 1994

g/m μ Particles, 3

12
Global warming Global warming

What to do? What to do?

13
Four central points Four central points

 Global warming is real and man Global warming is real and man

-made

-made

– UN/IPCC conclusion UN/IPCC conclusion

 Consequences vastly exaggerated Consequences vastly exaggerated

– E.g. Al Gore E.g. Al Gore

 We need smarter solutions We need smarter solutions

– Not “now or never” but “now or later” Not “now or never” but “now or later”

 Climate change not the only problem Climate change not the only problem

– Many other, better solutions first Many other, better solutions first

14
1

Global warming is real Global warming is real 

and man and man-made

15
Climate change is real Climate change is real

 On the agenda, thanks to Al Gore On the agenda, thanks to Al Gore  The best information from the UN The best information from the UN 

Climate Panel, IPCC Climate Panel, IPCC

 Likely temperature rise by 2100 Likely temperature rise by 2100

– 2.6

OC (4.7

OF)

 Total cost of $15 trillion Total cost of $15 trillion

– 0.5% of 21 0.5% of 21st century $3,000 trillion GDP century $3,000 trillion GDP

 Need smart strategy strategy

16
Global warming and Global warming and 

other costs of the 21 other costs of the 21st century century

IPCC 2000 IPCC 2000 Global Regional

Environmental Economic A2 A1B1 B2

$- 920T

-$1

310T $3005T

$- 553T

17
Global temperature 1856 Global temperature 1856

-2006

Jones et al. 2007 Jones et al. 2007

-0.2-0.4-0.6

0

0.80.60.40.2

1840 1860 1880 1900 1920 1940 1960 1980 2000

Temperatur ændring, oC 

18
2

Consequences vastly exaggerated Consequences vastly exaggerated

Leading to bad judgment Leading to bad judgment

19
Al Gore and the standard story Al Gore and the standard story

 Gore and many others tell us Gore and many others tell us 

– Planetary emergency Planetary emergency

 “We have just ten years to avert a major catastrophe “We have just ten years to avert a major catastrophe 

that could send our entire planet into a tail that could send our entire planet into a tail

-spin of epic spin of epic 

destruction involving extreme weather, floods, droughts, destruction involving extreme weather, floods, droughts, epidemics and killer heat waves beyond anything we epidemics and killer heat waves beyond anything we have ever experienced.” have ever experienced.”

 Four central issues Four central issues

– Heat deaths Heat deaths– Sea level rise Sea level rise– Hurricanes Hurricanes– Malaria Malaria

20
1 Higher mortality with heat? 1 Higher mortality with heat?

 Heat and cold deaths Heat and cold deaths

– In the UK In the UK

 2,000 more heat deaths by 2080 2,000 more heat deaths by 2080

– But fewer cold deaths But fewer cold deaths

 20,000 fewer 20,000 fewer

– Likewise in the US Likewise in the US

 174,000 174,000 net fewer deaths by 2050 deaths by 2050

Bosello, Roson, & Tol, 2006; Keatinge & Donaldson, 2004; Keating Bosello, Roson, & Tol, 2006; Keatinge & Donaldson, 2004; Keatinge et al., 2000 e et al., 2000

21
Higher temperature, fewer Higher temperature, fewer 

deaths 

– also globally also globally

0

800600400200

2,0001,8001,6001,4001,2001,000

USA Europe Rest of

Developed

China/India Rest of

Developing

World

r Thousand lives per yea

Lives saved, CardiovascularLives lost, Respiratory

Bosello Bosello et al. 2006 et al. 2006

22
2 Sea level rise 2 Sea level rise

 Sea levels will rise Sea levels will rise But not a catastrophe But not a catastrophe

– About 1 foot over the next 100 years About 1 foot over the next 100 years

 Not Al Gores Not Al Gores’ 20 feet 20 feet

– About 1 foot About 1 foot the last 150 years the last 150 years

 Did we worry? Did we worry?

23
Sea level rise Sea level rise

 Sea levels will rise Sea levels will rise

– Mostly due to warmer water expanding Mostly due to warmer water expanding

 But not a catastrophe But not a catastrophe

– 30cm over the next 100 years 30cm over the next 100 years

 Not Al Gores Not Al Gores’ 7 meters 7 meters

– 30cm the last 150 years 30cm the last 150 years

 Did we worry? Did we worry?

– Maldives lose 77% land (121% BNP) Maldives lose 77% land (121% BNP)

 Yes, if they don Yes, if they don’t act, but 0,00014% if they act t act, but 0,00014% if they act 

efficiently (cost: 0,1% BNP) efficiently (cost: 0,1% BNP)

24
Al Gore: melt from Greenland Al Gore: melt from Greenland

0

600500400300200100

IPCC Al Gore/ Hansen

Total sea level rise from Greenland, cm

 Greenland till 2100 Greenland till 2100

– Gore predict 20 feet Gore predict 20 feet– IPCC predict 1.4 inch IPCC predict 1.4 inch

 This is 174 times This is 174 times 

exaggerated exaggerated

 Not helpful in a Not helpful in a 

democratic debate democratic debate

 The impression of The impression of 

immediate inundation immediate inundation

25
3 Hurricanes: 3 Hurricanes:

ever costlier in the US ever costlier in the US

Pielke et al. 2007 et al. 2007

0

80604020

160140120100

1900

1905

1910

1915

1920

1925

1930

1935

1940

1945

1950

1955

1960

1965

1970

1975

1980

1985

1990

1995

2000

2005

s, billion 2005$ Damage cost

 Damage costs from hurricanes in the US Damage costs from hurricanes in the US

26
More people with more goods More people with more goods 

in exposed areas in exposed areas

0

80604020

160140120100

1900

1905

1910

1915

1920

1925

1930

1935

1940

1945

1950

1955

1960

1965

1970

1975

1980

1985

1990

1995

2000

2005

billion 2005$ costs, Adjusted damage 

Pielke et al. 2007 et al. 2007

 Damage costs if all hurricanes had hit the US in Damage costs if all hurricanes had hit the US in 

2007

27
Hurricanes: Hurricanes:

Fix climate or social vulnerability Fix climate or social vulnerability

 If we stop climate If we stop climate 

change

– Prevent 10% damage Prevent 10% damage 

increase increase

 If we end social If we end social 

vulnerability vulnerability

– Prevent 480% damage Prevent 480% damage 

increase increase

 Which knob should Which knob should 

we focus on? we focus on?

Pielke 2005

0%

50%

500%450%400%350%300%250%200%150%100%

climate change social vulnerability

Increase in hurricane losses till 2050

28
4 More malaria from heat? 4 More malaria from heat?

 Malaria is weakly connected to heat Malaria is weakly connected to heat

– But much more dependent on wealth and But much more dependent on wealth and 

treatment treatment

 Malaria endemic in Europe & US in little ice age Malaria endemic in Europe & US in little ice age

– Even malaria in the Arctic circle Even malaria in the Arctic circle– 20% malaria in Moscow in the 1940s 20% malaria in Moscow in the 1940s

 As economies strengthened, we dealt with malaria As economies strengthened, we dealt with malaria

– Even as temperatures increased Even as temperatures increased

 Thus, with economic growth comes lower malaria Thus, with economic growth comes lower malaria Is climate the right knob to turn? Is climate the right knob to turn?

29
Which knob to tackle malaria? Which knob to tackle malaria?

0.071

28.453

50

3025201510

Kyoto Malaria-specific

policy

Billion malaria infections avoided

 We can save 400 We can save 400 

times more times more

 At less than 2% of the At less than 2% of the 

cost

30
5 Melting glaciers 5 Melting glaciers

 Al Gore shows us melting glaciers Al Gore shows us melting glaciers

– But not surprising But not surprising– Maximal extent of glaciers since the last ice Maximal extent of glaciers since the last ice 

age was around 1750 age was around 1750 

 We are told we’re loosing the last We are told we’re loosing the last 

10,000 years of stable climate 10,000 years of stable climate

– Wrong. IPCC tells us that glaciers were Wrong. IPCC tells us that glaciers were 

almost absent 9,000 almost absent 9,000

-6,000 years ago 6,000 years ago

31
Kilimajaro melt Kilimajaro melt

Kaiser et al. 2004 Kaiser et al. 2004

32
Swiss Argentiere Glacier 1966 Swiss Argentiere Glacier 1966

33
Swiss Argentiere Glacier 1850 Swiss Argentiere Glacier 1850

34
Media tends to over Media tends to over

-worry

-worry

“The Ice Age Cometh?” 1975 “The Ice Age Cometh?” 1975

Cover of Science News 1975 Cover of Science News 1975



”Threat of climatic changes Threat of climatic changes

”



”Climate change: Chilling Climate change: Chilling Possibilities Possibilities

”

– The unusually beneficial climate of the past The unusually beneficial climate of the past 

few decades may be degenerating, facing few decades may be degenerating, facing humanity with a new cahllenge to survival humanity with a new cahllenge to survival

– We may be approaching the end of a major We may be approaching the end of a major 

interglacial cycle. interglacial cycle.

– This transition would involve only a small This transition would involve only a small 

change of global temperature change of global temperature 

– 2 or 3 

degrees degrees 

– but the impact on civilization but the impact on civilization 

would be catastrophic. would be catastrophic.

– Scientists once thought the onset of an ice Scientists once thought the onset of an ice 

age would be very gradual... but recent age would be very gradual... but recent studies ... indicate the transition can be studies ... indicate the transition can be rather sudden. rather sudden.

35
6 Consequences for agriculture 6 Consequences for agriculture

(production of cereals) (production of cereals)

0

4,0003,0002,0001,000

2000 2010 2020 2030 2040 2050 2060 2070 2080

Cereals Mt

Fischer et al. 2005 Fischer et al. 2005

36
Changes in hunger Changes in hunger

Arnell 2004

0

800600400200

1,2001,000

1950 1960 1970 1980 1990 2000 2010 2020 2030 2040 2050 2060 2070 2080

Starving, mil

60%50%40%30%20%10%%

Starving, perc

% Starving

Number of Starving

37
Again, which knob? Again, which knob?

0.0046

20.61

50

201510

Climate policy Hunger policy

n Millions saved from hunger, per billio

38
3

Smarter options needed: Smarter options needed:

Kyoto or EU 20% high cost Kyoto or EU 20% high cost-no gain no gain

39
 Cost of Kyoto Cost of Kyoto

– $180 billion per $180 billion per 

year

Wigley 1998

Kyoto:

Postpone warming by 5 years Postpone warming by 5 years

2.62.42.22.01.81.61.41.21.00.80.60.40.20.0

1990 2000 2010 2020 2030 2040 2050 2060 2070 2080 2090 2100

Temperature change, 

o

C

Busines-as-usualKyoto

40
Total cost/benefit of Kyoto Total cost/benefit of Kyoto

Nordhaus Nordhaus 2006

-1-2-3

6543210

USA Other

High

Income

Europe Eastern

Europe

Rest of

World

World USA Other

High

Income

Europe Eastern

Europe

Rest of

World

World

Impact, trillion 2005$

CostBenefit

Kyoto, w/US Kyoto, w/o US

41
 Cost 

– $90 billion per $90 billion per 

year

Nordhaus Nordhaus 2006

EU’s new 20% cut by 2020: new 20% cut by 2020:

Postpone warming by 2 years Postpone warming by 2 years

2.62.42.22.01.81.61.41.21.00.80.60.40.20.0

1990 2000 2010 2020 2030 2040 2050 2060 2070 2080 2090 2100

Temperature change, 

o

C

42
 Replace payroll tax Replace payroll tax

 Cost 

– $160 billion per $160 billion per 

year 

 Consequence Consequence

– $1.25 per gallon $1.25 per gallon– Essentially, US do Essentially, US do 

a Kyoto all by itself a Kyoto all by itself

Nordhaus Nordhaus 2006

Gore solution: Gore solution:

Postpone warming by 4.5 years Postpone warming by 4.5 years

2.62.42.22.01.81.61.41.21.00.80.60.40.20.0

1990 2000 2010 2020 2030 2040 2050 2060 2070 2080 2090 2100

Temperature change, 

o

C

Business-asusual

Gore Payroll

43
 Only Stern review Only Stern review 

shows otherwise shows otherwise

– Easily end up Easily end up 

making policies making policies that do more harm that do more harm than climate than climate change

Tol and Yohe 2006

All peer reviewed cost All peer reviewed cost-benefit benefit 

show little effort now show little effort now

Stern Review

-10-15-20

-5

50

Percent GDP

Costs Damages Costs Damages

Peer-reviewed

44
Why?

 Because cost is now, benefit Because cost is now, benefit much later

6543210

2000 2050 2100 2150 2200 2250

Cost, benfit, % of current GDP Cost Benefit Stabilizing at 1990 levels Stabilizing at 1990 levels

Nordhaus Nordhaus 2006

45
Global warming overview Global warming overview

All Cost/Benefit: Do little All Cost/Benefit: Do little

Nordhaus Nordhaus 2006

0

908070605040302010

Optimal Full

Trade

Only

OECD

Temp

2.5oC

Stabilize

1990

Temp

1.5oC

Impact, trillion 2005$

CostBenefit

---- K

yoto ----

46
Global warming and Global warming and 

other costs of the 21 other costs of the 21st century century

IPCC 2000 IPCC 2000 Global Regional

Environmental Economic A2 A1B1 B2

$- 920T

-$1

310T $3005T

$- 553T

47
Smarter way forward Smarter way forward

 Long

-term problem, long term problem, long

-term solution term solution

– Invest 0.05% of GDP in RD&D of non Invest 0.05% of GDP in RD&D of non

-

carbon emitting energy technologies carbon emitting energy technologies

– $25 billion/year $25 billion/year– Let each country focus on its own future Let each country focus on its own future

 renewables, fission, fusion, conservation, renewables, fission, fusion, conservation, 

carbon storage carbon storage

– Will solve global warming in the medium Will solve global warming in the medium 

term

48
4

Many other problems where we can Many other problems where we can 

do much more good do much more good

49
Gore:

our generational mission our generational mission

 How do we want to be remembered? How do we want to be remembered?

– Spending $180 billion/year doing virtually no good Spending $180 billion/year doing virtually no good 

a hundred years from now? (Kyoto etc.) a hundred years from now? (Kyoto etc.)

 Compare this to Compare this to

– For $75 billion/year the UN estimate we can solve For $75 billion/year the UN estimate we can solve 

all major basic problems all major basic problems

 Clean drinking water Clean drinking water Sanitation Sanitation Basic healthcare Basic healthcare Primary education Primary education

50
Copenhagen Consensus Copenhagen Consensus

Top economists: Most bang for the buck Top economists: Most bang for the buck

1 HIV/AIDS HIV/AIDS2 Micronutrients Micronutrients3 Free trade Free trade4 Malaria Malaria......

Very good Very good 

investments investments

Bad 

investments investments 16 Kyoto Protocol Kyoto Protocol

Copenhagen Consensus Copenhagen Consensus

$40$30$20$15

Good per dollar Good per dollar

$0.25

51
Summary Summary

 We are moving in the right direction We are moving in the right direction

– Many environmental indicators better Many environmental indicators better– We need to focus on the right priorities We need to focus on the right priorities

 Global warming is real & man Global warming is real & man-made Often wildly exaggerated Often wildly exaggerated

– Harms our ability to make good judgment Harms our ability to make good judgment

 We need smart decisions We need smart decisions

– Not fast, expensive and useless cuts but Not fast, expensive and useless cuts but– long-term, cost term, cost-effective investment in R&D effective investment in R&D

 Many other opportunities much better Many other opportunities much better

– Our real generational mission Our real generational mission

52
53