# Abstract We employ a single-country dynamically-recursive [[Computable General Equilibrium]] model to make health-focussed macroeconomic assessments of three contingent UK Greenhouse Gas (GHG) mitigation strategies, designed to achieve 2030 emission targets as suggested by the UK Committee on Climate Change. In contrast to previous assessment studies, ==our main focus is on health co-benefits additional to those from reduced local air pollution==. We employ a conservative cost-effectiveness methodology with a zero net cost threshold. Our urban transport strategy (with cleaner vehicles and increased active travel) brings important health co-benefits and is likely to be strongly cost-effective; our food and agriculture strategy (based on abatement technologies and reduction in livestock production) brings worthwhile health co-benefits, but is unlikely to eliminate net costs unless new technological measures are included; our household energy efficiency strategy is likely to breakeven only over the long term after the investment programme has ceased (beyond our 20 year time horizon). We conclude that UK policy makers will, most likely, have to adopt elements which involve initial net societal costs in order to achieve future emission targets and longer-term benefits from GHG reduction. Cost-effectiveness of GHG strategies is likely to require technological mitigation interventions and/or demand-constraining interventions with important health co-benefits and other efficiency-enhancing policies that promote internalization of externalities. Health co-benefits can play a crucial role in bringing down net costs, but our results also suggest the need for adopting holistic assessment methodologies which give proper consideration to welfare-improving health co-benefits with potentially negative economic repercussions (such as increased longevity). # 3. Database and simulation model ## 3.1 Macroeconomic CGE model Our economy-wide dynamically-recursive Computable General Equilibrium (CGE) model is based on the ‘IFPRI standard model’. This is a well-known and widely applied comparative static, single country, open economy, multi-sector CGE model, which is based on the fundamental axioms of profit-maximization among producers and utility maximization among households. Our UK CGE model was calibrated on the basis of a 2004 social accounting matrix. The standard model specification was expanded to account for household production of transport services and heating services and a set of factor updating equations was added to turn our static model into a dynamically-recursive model. A standard neo-classical model closure with flexible prices was used in all simulations. ## 3.3 Health effects For each scenario, age- and gender-specific calculations of disease burdens in terms of Years Lost due to Disability (YLD) and Years of Life Lost (YLL) were used to calculate implied changes to UK demographic composition, UK labour supplies, UK healthcare costs, and UK social security transfers for a range of illnesses. Gender and age-specific health effects (YLD/YLL) were determined by WHOs Comparative Risk Assessment (CRA) approach (see Woodcock et al. 2009; Friel et al. 2009; Wilkinson et al. 2009), and distributed over a 20 year time horizon assuming cause-specific time lags between exposure change and health effects (see Smith et al. 2013). The resulting dynamic patterns of health effects were used to derive (1) changes in demographic composition and effective labour force and (2) changes in social security transfers including reduced labour market benefits for working-age people and increased pension payments for pensioners with increased longevity. Furthermore, changes in disease burdens were used to measure changes in healthcare costs. (See Jarrett et al. 2012 and Smith et al. 2013 for details on the methodology). # 4. Policy scenarios ![[Policy scenarios of CGE model to reduce GHG.png]] # 6. Results Our urban transport strategy represents a desirable way to help achieve the sector-specific 2030 UK target for GHG emission reductions and at the same time reap significant health co-benefits. Non-air pollution health co-benefits play a key role in reducing net costs and ensuring cost-effectiveness. Moreover, while local air pollution health co-benefits are small in our scenario, they should be substantially higher if electric vehicles were widely adopted. Our analyses also suggest that increased active travel leads to significant increases in longevity. Since these welfare-improving health co-benefits may be hard to quantify in economic terms, this points to the need for adopting a more holistic assessment methodology for GHG strategies, which properly values the positive welfare impact of health co-benefits with negative economic repercussions (such as increased longevity). ==Our evidence suggests that demand-constraining interventions by themselves may carry high costs. This was exemplified by the healthy diet scenario, where the introduction of a distortionary food tax leads to significant welfare losses.== Our broader UK food and agriculture strategy, which includes additional technological improvements such as improved efficiency of livestock farming and decreased fossil-fuel inputs, should however carry smaller net costs (especially if supported by policy-related changes in consumer preferences leading to substitution with other ‘lower carbon’ and healthier foods). The importance of technological mitigation interventions was exemplified by our household energy efficiency strategy, where health effects were small but efficiency-improvements from improved insulation and ventilation reduced societal costs of implementation by almost 50 %. With continuing health effects and efficiency gains over the lifetime of the housing improvements, our UK household energy efficiency strategy should become cost-effective over the very long term, beyond our 20 year time horizon. > Based on our conservative approach to measuringhealthco-benefits and costeffectiveness, and considering the inherent uncertainties surrounding the measurement of investment requirements and behavioural tax incentives, we conclude that the mix of sectorspecific UK GHG strategies, required to achieve future emission targets, is likely to include elements which may not necessarily be cost-effective over our 20 year time horizon. This should however not deter policy makers from making the right decisions and implementing the necessary policies—preferably with a holistic focus on strategies which achieves minimum society costs and maximum health cobenefits.