Eliminating the Need for Life Cycle Analysis for Carbon Accounting and in the Certification of Carbon Sequestration

Klaus Lackner, Stephanie Arcusa, Habib Azarabadi, Vishrudh Sriramprasad and Robert Page

No q9pzb, OSF Preprints from Center for Open Science

Abstract: Life Cycle Analysis (LCA) is currently standard practice in carbon accounting and certification of carbon sequestration. LCA is an essential and valuable tool for understanding the environmental footprint of technologies and products. However, well-known ambiguities, insatiable demand for detailed data, and uncertainties make it ill-suited for carbon accounting. Because of these complications, it is better to avoid LCA in accounting. This can be done given the right regulatory setting. A simple approach to balancing the anthropogenic carbon budget is to demand that an equivalent amount must be permanently removed for any carbon released. Known as the “Carbon Takeback Obligation” (CTBO), this policy regime would eliminate the need for LCA in monitoring and accounting as any CO2 emitted downstream from the extraction is already balanced. This eliminates the need for tracking carbon through the supply chains. It is sufficient to quantify the amount of carbon sequestered without subtracting upstream emissions. Our modeling further shows that at carbon neutrality, market forces alone will eliminate all sequestration approaches that release more CO2 than they store. Complications arise during the transition to a fully functioning regime, as technologies that produce more emissions than they remove could game the system. While detrimental technologies can learn and still become useful, intentional fraudulence must be stopped. Therefore, we explore four transition pathways and their economics: a simple CTBO, a CTBO plus permit scheme, a futures market, and hybrid schemes. A policy that only demands a simple CTBO for carbon and does not add any economic burden on unmitigated carbon will incentivize low-cost sequestration technologies that may indirectly release more carbon than they remove. By contrast, a pure permit-based policy will render carbon sequestration technologies that emit more CO2 than they remove economically unviable. A policy with controlled futures would allow for a far more rapid phaseout of permits than would otherwise be necessary. A hybrid system would lessen the initiation shock and bridge the transition time in which the sequestration capacity falls short of market demand.

Date: 2023-02-17
New Economics Papers: this item is included in nep-des, nep-ene and nep-env
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Persistent link: https://EconPapers.repec.org/RePEc:osf:osfxxx:q9pzb

DOI: 10.31219/osf.io/q9pzb

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