Upcoming
$10
CE Workshop: Merging Models — Climate Economics
1
Slide Decks
2
Documents
8
Agenda Items
7
Q&A Questions
20
Seats Available
An in-depth hands-on workshop covering how to merge climate and economic models inside the CE Engine. Participants will work through real-world integrated assessment scenarios, calibrate physical-to-financial transmission pathways, and build custom policy overlays. Suitable for analysts, investors, and policy professionals with basic familiarity with the CE Engine.
The views expressed in this workshop are the speaker's own and do not represent the position of any government, institution, or third party. All data cited is drawn from publicly available sources. No endorsement of any product, organisation, policy position, or investment strategy is implied or offered. All analyses are provided solely to encourage more informed, evidence-based decision making.
09:00
Welcome & setup — slides 1–2: The Core Problem
5 min
09:05
What is CE Engine? — slides 3–5: architecture, philosophy, and site sections tour
10 min
09:15
Economic models landscape — slides 6–10: DSGE, IAMs, track record, and the climate blind spot
12 min
09:27
Climate models landscape — slides 12–15: GCMs, SSP scenarios, track record, and model limits
8 min
09:35
The merge problem — slides 17–21: why coupling is hard, transmission pathways, damage functions, and tipping points
8 min
09:43
CE's approach — slides 22–25: CE architecture, policy analysis, carbon pricing, and the growth question
5 min
09:48
CE in Practice: Solution Scale — slides 27–34: 52 Gt abatement gap, technology stack, policy levers, social cost of carbon, and integrated picture
7 min
09:55
Conclusion & Q&A — slides 36–39: challenging assumptions, uncertainty accounting, and CE synthesis
5 min
Pre-event questions & answers
Question submitted — we'll answer it before the event.
What software do I need installed?
Answer
Nothing beyond a modern browser. The CE Engine runs entirely in the cloud — no local installation required. You'll just need a Google Meet link, which will be sent to registered attendees the day before.
How does CE handle the difference between physical climate risk and transition risk? Are they modelled separately or coupled?
Answer
Both channels are modelled explicitly and then coupled. Physical risk flows through asset exposure, labour productivity, and infrastructure damage functions. Transition risk flows through carbon cost pass-through, stranded-asset repricing, and policy-driven capex shifts. The CE transmission module connects them — a carbon tax, for example, simultaneously affects sector profitability (transition) and fiscal capacity to fund adaptation (physical). We'll walk through this architecture in detail on slide 18.
The DICE damage function has been heavily criticised by Burke et al. and Weitzman. Does CE use a different approach, and if so, what's the empirical basis?
Answer
CE does not use a single damage function. Instead it decomposes damages into sector-specific channels — agricultural yield loss, coastal asset exposure, labour productivity (heat stress), and health cost — each with their own empirical basis drawn from Burke et al. (2015), IPCC AR6 WGII, and the Swiss Re Institute. This approach avoids the polynomial smoothing that makes DICE miss non-linearities and tipping points. Slide 19 covers this in detail, and users can inspect and override the underlying coefficients in the Workbench.
Can CE model country-level fiscal responses to climate shocks — for example, how a sovereign's debt capacity changes after a major flood event?
Answer
Yes — this is one of CE's core use cases. The fiscal module tracks the primary balance impact of climate shocks (disaster relief, rebuilding, output loss) against a baseline fiscal trajectory from IMF WEO data. You can model one-off catastrophic events or chronic stress accumulation. The output includes debt/GDP trajectory and sovereign risk premium shifts under each scenario. We'll demo this with a small-island-state case study.
Is CE designed for institutional investors, or is it also useful for policy teams and academics?
Answer
All three. The same underlying model can be run in three different modes: (1) Portfolio risk overlay — for asset managers stress-testing against SSP scenarios; (2) Policy simulation — for government analysts testing carbon pricing designs or green fiscal packages; (3) Research calibration — for academics who want to inspect assumptions, override parameters, and compare against published IAM outputs. The interface adapts based on what questions you're asking.
How does CE treat the discount rate problem — Stern vs Nordhaus? Can users set their own?
Answer
The discount rate is the single most consequential parameter in climate economics, and CE now ships a dedicated Social Cost of Carbon calculator at <a href='/scc'>/scc</a>. It provides three canonical presets — Nordhaus DICE 2023 (4.25%), Stern Review (1.4%), and updated Ramsey/EPA 2023 (2.5%) — alongside a full sensitivity sweep from 0.5% to 7.0%. The same parameter that shifts the SCC from ~$51 to ~$450/tCO₂ also determines the theoretically correct carbon price under any given ethical framework. Users can inspect exactly how each year's future damage is discounted, compare policy recommendations across all three presets, and link directly to scenario-level analysis in the Integration Desk.
What's the plan for integrating tipping point cascades? The current IPCC scenarios don't adequately capture cascade risk.
Answer pending