WIR SCHAFFEN WISSEN – HEUTE FÜR MORGEN
Introducing external costs for Local Atmospheric
Pollution in TIAM-MACRO to study s...
• Quantification of synergies and co-benefits of LAP while solving for GCC
(The present assessment of climate change gives...
Project Stucture
Page 3
• After a period of time making some experiments with the MERGE version of
Johannes Bollen, I concluded that this option i...
• One could compensate for negative externalities due to LAP by introducing taxes
per unit of pollution such that the marg...
• PSI has developed an approach to extend the NEEDS Externality taxes for EU2010
to the 15 world regions and up to the tim...
Adjustment factors for externalities based on PSI methodology
(WTP,GDP, Population, Urbanization)
Page 7
0
1
2
3
4
5
6
201...
BS for 2 oC with 66% prob. w/o externalities
Page 8
Efficient solution  Global GDP losses of 5.1% with strong regional di...
Grandfathuring in 2020 moving to equal
emissions per capita in 2050
Page 9
-5
0
5
10
15
20
25
2020 2030 2040 2050 2060 207...
From grandfathering to eqalitarian
Page 10
-6
-4
-2
0
2
4
6
2020 2030 2040 2050 2060 2070 2080 2090 2100
Rule I: GtC/yr Ca...
Global Emissions BASE and 2°C cases;
Accounting only not optimization
Page 11
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50
100
150
200
250
300
2020 2020 2050 2050...
Co-Benefits of LAP Control (POA simulation)
Page 12
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0.5
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2020 2030 2040 2050 2060 2070 2080 2090 2100...
Co-Benefits of LAP Control (POA simulation)
Page 13
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AFR AUS CAN CHI CSA EEU FSU IND JPN MEA MEX OD...
• Market damages are assumed to be proportional to temperature change
• Non market damages are assumed to be quadratic or ...
Even at zero discount rate the global GDP losses of GCC policies are reduced from 5.14%
to 3.38%; that means the costs of ...
Reduced relative GDP losses by region =
GCC Benefits and LAP-Co-Benefits
Page 16
0
0.5
1
1.5
2
2.5
3
3.5
AFR AUS CAN CHI C...
• The 2oC is technically feasible and if we choose the proper burden sharing rule it can
also be equitable while the mean ...
Page 18
Wir schaffen Wissen – heute für morgen
Thank you for your attention !
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Introducing external costs for Local Atmospheric Pollution in TIAM-MACRO to study synergies and co-benefits of climate change mitigation

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Introducing external costs for Local Atmospheric Pollution in TIAM-MACRO to study synergies and co-benefits of climate change mitigation

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Introducing external costs for Local Atmospheric Pollution in TIAM-MACRO to study synergies and co-benefits of climate change mitigation

  1. 1. WIR SCHAFFEN WISSEN – HEUTE FÜR MORGEN Introducing external costs for Local Atmospheric Pollution in TIAM-MACRO to study synergies and co- benefits of climate change mitigation Socrates Kypreos1, Evangelos Panos1, George Giannidakis2, James Glynn3, and Kathrin Volkart1 1Energy Economics group, Laboratory for Energy Systems Analysis, PSI, Switzerland, 2ETSAP Project Leader, 3University College Cork, Ireland Semi-Annual ETSAP meeting in Cork Ireland, May 2016
  2. 2. • Quantification of synergies and co-benefits of LAP while solving for GCC (The present assessment of climate change gives unbalanced C/B results excluding the benefits of LAP contol). • Improvement of the global model TIAM-MACRO including LAP databases • Selection of the proper modeling approach for LAP in TIAM-MACRO • Develop ETSAP software for Post Optimal Analysis (POA) for Burden Sharing (BS) following different rules Scope of the IEA-ETSAP Project on Local Atmospheric pollution (LAP) and Global Climate Change (GCC) Page 2
  3. 3. Project Stucture Page 3
  4. 4. • After a period of time making some experiments with the MERGE version of Johannes Bollen, I concluded that this option is not convenient for TIAM MACRO. • The main reason being the strong non-linearities of the method to address PM2.5 (only). One of the basic requirements for TIAM-MACRO to converge is to solve a linear energy problem in TIAM, with linear constraints. • Non-liner relations for LAP sould have been included in the MACRO part. • Such an approach is not sure that converges and requires experimentation and heuristic methods, but there was not time available for such experiments. Net-benefits of LAP control could have been defined in the welfare function, but… Page 4
  5. 5. • One could compensate for negative externalities due to LAP by introducing taxes per unit of pollution such that the marginal cost of LAP control is equal to the marginal benefits of avoided pollution (emissions) • TIAM has the structure (option) to consider directly any taxes per unit of pollutants in the objective function without any code modification. • Such taxes have been defined in the past for the Pan-European TIMES model for the EU NEEDS project and are based on LCA and ExternE results. • Thus, I had no to reinvent the weel Explicit treatment of emissions and externalities Page 5
  6. 6. • PSI has developed an approach to extend the NEEDS Externality taxes for EU2010 to the 15 world regions and up to the time horizon of analysis • CRES was able to specify specific emission data for existing and new technologies following either energy flows in a sector or technology specific activities • SK (PSI) has developed a GAMS code for Burden Sharing and 4 rules with and without externalities • JG (UCC) has extented the approach for two more rules of BS in the direction of the Brazilian approach • The final project report is in preparation Explicit treatment of emissions and externalities Page 6
  7. 7. Adjustment factors for externalities based on PSI methodology (WTP,GDP, Population, Urbanization) Page 7 0 1 2 3 4 5 6 2010 2020 2030 2040 2050 2060 2070 2080 2090 2100 AFR AUS CAN CHI CSA EEU FSU IND JPN MEA MEX ODA SKO USA WEU Figure 1: Total (combined) adjustment factors fr,t [-] for the 15 regions in the TIAM model and the time periods 2010-2100. 1 = WEU in 2010. Externality taxes are defined as follows: EX-TAX(rg,yr) = EX-TAX(rg,2010)*f(rg,yr)
  8. 8. BS for 2 oC with 66% prob. w/o externalities Page 8 Efficient solution  Global GDP losses of 5.1% with strong regional differences Eqalitarian rule I:  Picture good for LDCs in the first half, bad in the second one Equal relative GDP losses II:  Balanced but not quite fine for LDCs Full GDP compensation for LDCs III: Balanced but industrialised countries pay high costs Full EC compensation for LDCs IV: Cheap while LCDs get the needed investments for energy -20 -15 -10 -5 0 5 10 15 20 AFR AUS CAN CHI CSA EEU FSU IND JPN MEA MEX ODA SKO USA WEU World GDP Losses and gains (negative) per rule in % eff rule I Rule II Rule III RuleIV
  9. 9. Grandfathuring in 2020 moving to equal emissions per capita in 2050 Page 9 -5 0 5 10 15 20 25 2020 2030 2040 2050 2060 2070 2080 2090 2100 Per Capita emissions (t CO2/(capXyear): Rule I AFR AUS CAN CHI CSA EEU FSU IND JPN MEA MEX ODA SKO USA WEU
  10. 10. From grandfathering to eqalitarian Page 10 -6 -4 -2 0 2 4 6 2020 2030 2040 2050 2060 2070 2080 2090 2100 Rule I: GtC/yr Carbon trade transfers AFR AUS CAN CHI CSA EEU FSU IND JPN MEA MEX ODA SKO USA WEU -20 -15 -10 -5 0 5 10 15 20 2020 2030 2040 2050 2060 2070 2080 2090 2100 Rule I: trillion USD/yr /Capital transfers AFR AUS CAN CHI CSA EEU FSU IND JPN MEA MEX ODA SKO USA WEU
  11. 11. Global Emissions BASE and 2°C cases; Accounting only not optimization Page 11 0 50 100 150 200 250 300 2020 2020 2050 2050 2080 2080 2100 2100 BASE 2DS BASE 2DS BASE 2DS BASE 2DS MillionTonnes/yr NH3 NOX PM10 PM25 SO2 VOX
  12. 12. Co-Benefits of LAP Control (POA simulation) Page 12 0 0.5 1 1.5 2 2.5 3 3.5 4 2020 2030 2040 2050 2060 2070 2080 2090 2100 TlUSD/yr AFR AUS CAN CHI CSA EEU FSU IND JPN MEA MEX ODA SKO USA WEU
  13. 13. Co-Benefits of LAP Control (POA simulation) Page 13 0 0.5 1 1.5 2 2.5 3 3.5 AFR AUS CAN CHI CSA EEU FSU IND JPN MEA MEX ODA SKO USA WEU Mean global benefits are 1.05 % of GDP 2020 2030 2040 2050 2060 2070 2080 2090 2100
  14. 14. • Market damages are assumed to be proportional to temperature change • Non market damages are assumed to be quadratic or higher in temperature rise • The avoided market and non-market damages become apparent in the 2nd half of 21st century • Benefits of CO2 emission control and those of improved LAP are about 1.76%/yr and may change the picture of winners and losers by region  can motivate for policy actions Damages due to climate change and benefits of LAP emissions control Page 14 0 0.5 1 1.5 2 2.5 3 3.5 4 4.5 5 2020 2030 2040 2050 2060 2070 2080 2090 2100 percent BASE 2DS NETBenefit
  15. 15. Even at zero discount rate the global GDP losses of GCC policies are reduced from 5.14% to 3.38%; that means the costs of GCC control remains higher than benefits. Burden sharing for 2oC_66% net of benefits Page 15 -20 -15 -10 -5 0 5 10 15 20 AFR AUS CAN CHI CSA EEU FSU IND JPN MEA MEX ODA SKO USA WEU World GDP Losses and Gains (negative) per rule in % eff rule I Rule II Rule III Rule IV
  16. 16. Reduced relative GDP losses by region = GCC Benefits and LAP-Co-Benefits Page 16 0 0.5 1 1.5 2 2.5 3 3.5 AFR AUS CAN CHI CSA EEU FSU IND JPN MEA MEX ODA SKO USA WEU World percentofGDPBASE eff rule I Rule II Rule III RuleIV
  17. 17. • The 2oC is technically feasible and if we choose the proper burden sharing rule it can also be equitable while the mean GDP gains due to LAP control are about 1% originated mostly in China followed by Africa. • Equal relative GDP losses is a balanced burden sharing allocation:  Full compensation of the energy cost for the South is less expensive for the industrialised countries.  Perhaps a combination of both could convince DCs to participate but it must be clear they will not go beyond the INDC commitments without compensation • The climate change mitigation costs can be reduced if benefits of climate change mitigation (avoided damages) and the co-benefits of LAP control are considered but control costs are not fully balanced and remain high • Key technologies for power generation and LAP reduction are wind, solar PV, Nuclear, coal and gas with CCS; BECCS, synfuel and H2 from biomass while good for CO2 reduction, generate PM Conclusions Page 17
  18. 18. Page 18 Wir schaffen Wissen – heute für morgen Thank you for your attention !

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