Revisiting the social cost of carbon after INDC implementation in Malaysia: 2050

Abstract

This article projects the social cost of carbon (SCC) and other related consequences of climate change by using Malaysia’s intended nationally determined contribution (INDC) and climate vision 2040 (CV2040) by 2050. It compares the projections derived from the Dynamic Integrated Model of the Climate and Economy (DICME) based on the respective INDC and CV2040 scenario. The results reveal that industrial emissions would incur a substantial increase every 5 years under the scenario CV2040, while Malaysia would experience lower industrial emissions in the coming years under the scenario INDC. Emission intensity in Malaysia will be 0.61 and 0.59 tons/capita in 2030 for scenario CV2040 and scenario INDC respectively. Malaysia would face climate damage of MYR456 billion and MYR 49 billion by 2050 under CV2040 and INDC scenario respectively. However, climate damage could be much lower if the INDC regime were adopted, as this scenario would decrease climatic impacts over time. The estimated SSC per ton of CO2 varies between MYR74 and MYR97 for scenario CV2040 and MYR44 and MYR62 for scenario INDC in 2030 and 2050 respectively. Considering different aspects, including industrial emissions, damage cost, and social cost of carbon, INDC is the best policy compared to CV2040. Thus, Malaysia could achieve its emissions reduction target by implementing INDC by 2050.