There is a wide scientific consensus that global climate is changing in part as a result of human activities (IPCC, 2001b), and that the social and economic costs of slowing it down and of responding to its impacts will be large (OECD, 2001a). In the past there has been a steady rise in average global temperature: the 1990s were around 0.6°C warmer than the late 1890s. The 1990s were the warmest decade since the beginning of instrumental record-keeping in 1860, and the warmest in the past thousand years on the basis of tree rings and other proxy measurements. Moreover, there has been an increase in the number of heat waves and a reduction in the frequency and duration of frosts in many parts of the world. It is now generally accepted that this climate change is the result of increasing concentrations of carbon dioxide, methane, nitrous oxide and other greenhouse gases (GHGs) in the atmosphere (IPCC, 2001a).