5 The global carbon budget is a policy choice

As we learned in the previous section, selecting the global CO2 budget involves two fundamental policy choices. First, policymakers need to select the temperature target that they prefer, which is associated with different climate risks. Second, policymakers need to select their preferred likelihood of staying below the selected temperature limit.

The carbon budget is then calculated based on these choices. Different choices imply a different global carbon budget and, therefore, the budget reach under any scenario for the future development of economic growth and the speed of decoupling of economic activity from carbon emissions.

The global carbon budget derives from two fundamental policy choices:

  • How severe do we want the effects of climate change to become? This defines our preferred global warming limit.
  • How certain do we want to be about preventing climate change from becoming worse than that? This defines the likelihood of staying below the warming limit.

Before we select a preferred budget from the table, let’s briefly reflect on the differences in terms of climate risk between scenarios with 1.5 vs. 2 degrees of global warming.