When volcanoes erupt, they release sulfur dioxide into the stratosphere, where the gas transforms into sulfuric acid droplets, also known as aerosols, which reflect sunlight. Historically, large volcanic eruptions have caused discernible global cooling. When Mount Pinatubo erupted in the Philippines in 1991, it emitted 17 million tons of sulfur dioxide that caused a 0.5-0.6°C drop in the Northern Hemisphere's temperature. Mexico's Mount Chichon eruption in 1982 also had a demonstrable cooling effect.
Advocates of geoengineering, or manipulating climatic elements in order to slow climate change, have suggested mimicking this cooling effect by spewing sulfur dioxide into the atmosphere. One of the flaws in their argument, in addition to the need for an 18-mile-long vertical hose, is that sulfur dioxide is not all fun and cooling games. The gas also causes acid rain and wears away the ozone layer, a key barrier to the sun's rays.
At this point, scientists think Iceland's eruption is too small to cause cooling -- notwithstanding the massive disruptions it is causing to air travel in northern Europe. If Eyjafjallajokull continues to spew gas into the atmosphere, though, that could change. The eruption is already ten times more powerful than a different Icelandic one last month, and the ash cloud extends seven miles into the stratosphere -- so at least the sunsets are pretty.
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