A Bridge Between Climate Science and Economics: OPTiMEM and the Heat Conjecture for Estimation of Social Cost of Greenhouse Gases
We present an entirely new physics founded approach to estimating the social cost of carbon (SCC). For this, we developed our Ocean-Heat-Content Physics and Time Macro Economic Model (OPTiMEM) to estimate future heat content. The heat conjecture assumes that weather damages curves are stochastically proportional to ocean heat increase. We model carbon combustion, validate to datasets for greenhouse gas (GHG), temperature, and ocean heat content (OHC). We show that the social cost of 4 GHGs: CO2, CH4, N2O and halogenated hydrocarbons, cannot be single values, but must be represented by a kind of economic phase space. We propose very long-term carbon bonds to implement real discounting. This obviates the Gordian knot of the descriptivist versus prescriptivist discount disagreement that is unsolvable. Implementing these bonds leads to a new monitoring metric: real-dollar spending and bond discount rates compared to SC-GHG cost with variation on the discount scale, where the discount has no relationship to the pure rate of time preference (PRTP). This heat conjecture is based on OPTiMEM. OPTiMEM initiates from a fossil fuel consumption function to produce CO2, with 18 scenarios implemented to provide the uncertainty range. We provide 1:N year loss risk models (1:10, 1:100, 1:1000) that government, engineers, and actuaries should find useful. A scenario implementing DICE family of models carbon and growth assumptions shows +18{\deg} C is breached by 2210 CE, and +110{\deg} C by 2300 CE -- both of which outcomes are obviously not compatible with the fairly rosy conclusions of DICE models. Concerns are raised about having enough low-cost fossil fuel for conversion to minimal CO$_2$ maximal energy return on energy invested (EROEI) power if nations wait too long, and low EROEI power is questioned because monetary value is dependent on energy.