Steckel daad 271112_v02

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Steckel daad 271112_v02

  1. 1. Developing  Countries  in  the  Context  of  Climate  Change   Mi<ga<on  and  Energy  System  Transforma<on   Rio  +  20  Workshop  /  DAAD  Webinar   Potsdam,  November  27,  2012   Dr.  Jan  Steckel   1  
  2. 2. Outline  of  the  talk  •  Introduc<on  •  Economic  development,  energy  use  and  CO2  emissions  •  The  energy  system  transforma<on  in  the  context  of  global  jus<ce  •  Climate  policy  and  energy  –  reframing  model  results  •  Some  final  thoughts  on  climate  policy  and  growth     2  
  3. 3. Introduc2on  
  4. 4. Where  do  we  stand?  –  GHG  emissions  by  country  today   4   (World  Bank  2010)  
  5. 5. Wealth  and  carbon  emissions   5   (  Füssel  2007)  
  6. 6. Economic  Development,  Energy  Use,  and  CO2  Emissions  
  7. 7. Role  of  developing  countries  in  mi2ga2ng  climate  change   Global  emissions   BAU   550  ppm  CO2-­‐e  scenario   Based  on  data  from  Luderer  et  al.  (2012)  Non  Annex  I  countries  will  need  to  bare  a  major  share  of  the  reduced  emissions  !     7  
  8. 8. The  scope  of  the  challenge   (WDR  2010)  Key  ques<on  for  developing  countries:     Is  leapfrogging  possible?     8  
  9. 9. Empirical  rela2onship  between  economic  and  emissions  growth  and  energy   consump2on  in  developing  countries   Energy  1971  -­‐  2005   Emissions  1971  -­‐  2005   Developing  countries   Developing  countries   Stronger   Stronger   coupling  of   coupling  of   growth  and   growth  and   energy   emissions   OECD  countries   OECD  countries   Weaker   Weaker   coupling  of   coupling  of   growth  and   growth  and   energy   emissions   ‚Decoupling‘  should  not  be  expected  for   (Jakob  et  al.  2012)   developing  countries  in  the  near  to  midterm   9  
  10. 10. Who’s  driving  emissions  ?   1971-­‐2007   Annual  effect  on  CO2  growth  -­‐  Global  emissions  growth  in  recent  years  mainly  by  newly   industrializing  and  developing  countries    -­‐  China’s  role  outstanding   i.  High  GDP-­‐growth   ii.  Slower  improvement  of  energy  intensity   iii.  Scaling  effects  of  tradi<onal  coal  use  in  China   10  
  11. 11. Understanding  emissions  growth   GDP   E   CO2   Kaya  Iden<ty:   CO2   =  pop    x   x     x     pop     GDP   E   China   India   NICs  USA   Europe  (OECD)   OECD  (all)   11  
  12. 12. Drivers  of  global  emissions   Decomposition of Carbon intensity (updated from Steckel et al, 2011) Global  Economic   Crisis   12  
  13. 13. Renaissance  of  Coal?   (IMF 2011) 13  
  14. 14. Fossil  Fuel  Scarcity  vs.  Limited  Atmospheric  Space   14  
  15. 15. Conclusions  1st  part  •  Leapfrogging  is  not  taking  place  •  Economic  growth  par<cularly  in  newly  industrializing  countries  drives   CO2  emissions     15  
  16. 16. The  Energy  System  Transforma2on  in  the  Context  of  Global   Jus2ce  
  17. 17. Fossil  Fuels  Dominate  the  World  Energy  System   Traditional biomass 6% Modern bioenergy 4% Shares  of  Primary  Energy  Supply  2008   17  
  18. 18. Transforma2on  of  the  Energy  System   (Luderer et 18   2011) al.,
  19. 19. Transforma2on  of  the  Energy  System   models   MERGE   TIMER   POLES   REMIND   E3MG   Baseline Many  different  pathways  to  transform  the  energy  system  400 ppm-eq   Different  possibili<es  to  reach  low  stabilisa<on   (Knopf  et  al.  2009)    400ppm  can  be  achieved  by  all  models     19  
  20. 20. Renewable  Energy  Poten2als   (Edenhofer  et  al.  2011)   20  
  21. 21. Costs  of  Renewable  Energy  (Edenhofer  et  al.  2011)   21  
  22. 22. Costs  of  mi2ga2on   (  Edenhofer  et  al.  2011)  Costs  hinge  cri<cally  on:    • The  stabiliza<on  target    • The  biomass  poten<al    • The  availability  of  technologies,  RE  and  CCS  in  par<cular     22  
  23. 23. Mi2ga2on  costs  in  developing  countries   Global   NA-­‐I  countries   Luderer  et  al.  2012  Mi<ga<on  costs  in  developing  countries  rather  moderate;  however  this  is  due  to  financial  transfers  from  developed  countries   23  
  24. 24. How  to  finance  mi2ga2on  in  developing  countries?     Non-­‐market  based  mechanisms  to  disburse  climate  finance:   Coverage  of  incremental  investment  costs   Coverage  of  total  mi<ga<on  costs     Market-­‐based  mechanisms  (Interna2onal  Emissions  Trading):   Grandfathering,  or  alloca<on  propor<onal  to  GDP   Equal  per  capita  alloca<on  of  permits   Contrac<on  and  Convergence   24  
  25. 25. Non-­‐Market  Transfers   (Jakob et al, submitted.) 25  
  26. 26. Emission  Trading   per capita per capita (Jakob  et  al,  submioed.)   26  
  27. 27. Transfer  payments  and  long  term  growth   Nega<ve  influence  of  resource  rents  on   Sachs  and  Warner,  2001   GDP  /  capita  1970  -­‐  1989   long  term  growth  conceivable   (“Resource  Curse“)   Resource  exports  in  %  of   GDP,  1970   Climate   Finance  Range   [%  of  GDP]   • Climate  rent  comparable  to     resource  rent   • Transfers  might  be  in  the  same     order  of  magnitude  Data:   • Ins<tu<onal  quality  of  receiving    Resource  Exports,  FDI:  Year  2009  Aid:  Year  2008   countries  is  cri<cal  ETS:  ReMIND  scenario  Year  2020   27  
  28. 28. How  to  Avoid  a  Climate  Finance  Curse?  •  Possible  problems  with  financial  inflows:  vola<lity,  Dutch  disease,  rent-­‐ seeking  •  Higher  risk  of  climate  finance  curse  with  emissions  trading;  but   problem  to  efficiently  deliver  non-­‐market  transfers  •  Transfer  of  rents  can  be  limited  by  appropriate  choice  of  alloca<on;  but   might  conflict  with  no<ons  of  equity  •  Properly  designed  ins<tu<ons  can  reduce  risk  of  climate  finance  curse   (e.g.  price  corridors,  sovereign  wealth  funds,  civil  society  involvment)   28  
  29. 29. Conclusions  2nd  part  •  Leapfrogging  is  not  taking  place  •  Economic  growth  par<cularly  in  newly  industrializing  countries  drives   CO2  emissions    •  A  structural  transforma<on  of  the  energy  system  is  possible  at  modest   costs  (according  to  state-­‐of-­‐the  art  models);  but  without  historical   precedent    •  How  to  design  climate  policy  in  developing  countries  is  a  key  issue   29  
  30. 30. Climate  Policy  and  Energy  –  Reframing  model  results  
  31. 31. Energy  Access   (Edenhofer  et  al.  2011)  Number  of  people  (millions)  without  access  to  electricity   31  
  32. 32. Energy  and  Human  Development  Index   i.  Do  countries  need  to   meet  a  certain  level  of   Very  high   energy  consump<on   High   to  reach  high   development  levels?     ii.  What  does  that  mean   for  climate  mi<ga<on   targets?     Low  Threshold  at  around  40  GJ  per  capita  10  GJ  per  capita  can  be  explained  by  subsistence  needs  Decoupling  of  energy  consump<on  and  development  not  oberserved  in  the  past   32  
  33. 33. Energy  and  development  in  scenarios   BAU   $50   $30   $10   GDP per capita [$]GDP per capita [$] Final Energy per capita [GJ] Final Energy per capita [GJ] •  Decoupling  of  energy  and  development  is  seen  in  mi<ga<on   scenarios     •  Energy  threshold  is  however  ignored   33  
  34. 34. Energy  and  Human  Development  Index   i.  Do  countries  need  to   meet  a  certain  level  of   Very  high   energy  consump<on   High   to  reach  high   development  levels?     ii.  What  does  that  mean   for  climate  mi<ga<on   targets?     Low  Threshold  at  around  40  GJ  per  capita  10  GJ  per  capita  can  be  explained  by  subsistence  needs  Decoupling  of  energy  consump<on  and  development  not  oberserved  in  the  past   34  
  35. 35. Infrastructure  needs  can  explain  parts  of  the  gap   Cement Developed  Countries   Developing  Countries  will  catch  up   (Scenario  data  in  blue)   Steel Developed  Countries   A  per  capita  energy  demand  of  10  to  20  GJ  in  developed   countries  seems  to  be  stable  given  today’s  technologies.   35  (Steckel  et  al.  submioed)  
  36. 36. Energy  and  Human  Development  Index   Very  high   High   Low  Threshold  at  around  40  GJ  per  capita  10  GJ  per  capita  can  be  explained  by  subsistence  needs  10  –  20  GJ  per  capita  might  be  due  to  infrastructure  uptake  and  maintenance   36  
  37. 37. Conclusions  3rd  part  •  Leapfrogging  is  not  taking  place  •  Economic  growth  par<cularly  in  newly  industrializing  countries  drives   CO2  emissions    •  A  structural  transforma<on  of  the  energy  system  is  possible  at  modest   costs  (according  to  state-­‐of-­‐the  art  models);  but  without  historical   precedent    •  How  to  design  climate  policy  in  developing  countries  is  a  key  issue  •  Infrastructure  can  next  to  subsidiary  needs  explain  an  energy  threshold   for  development  •  Models  predic<ng  modest  costs  do  not  take  this  into  account  or  make   strong  assump<ons     37  
  38. 38. Some  final  thoughts  on  climate  policy  and  growth   38  
  39. 39. Drivers  of  emissions  growth   Annual  emissions  growth  1980  –  2008  [%]  Annual  poverty  allevia<on   1980  –  2008    [%]   Worldbank  Data  (2012)   Regions  with  the  highest   success  in  poverty   East  Asia  incl.  China   allevia<on  also  show   high  growth  rates  in   emissions   39  
  40. 40. Can  climate  policy  impact  growth?     Growth  is  beneficial  for  the  poor!   (Dollar and Kray, 2002) 40  
  41. 41. Mi2ga2on  trap  in  a  Solow  model  Produc<on  func<on:     [$]Capital  forma<on:     (Steckel 2012) K0   KC  In  the  case  of  climate  policy  β  can  decrease.     The  trap  gets  more  likely  in  the   presence  of  climate  policy  in  the   form  of  βK(s)  [Independent  from   the  form  of  the  func<on  s(k)]   41  
  42. 42. Conclusions  •  Impacts  from  climate  change  will  hit  developing  countries  hardest  •  Mi<ga<on  burden  is  equally  high  (or  even  higher)  for  developing   countries  •  Technologies  might  help  to  mi<gate  climate  change,  but  …    •  low  carbon  technologies  are  s<ll  more  expensive  than  fossil  fuels  •  Models  see  that  mi<ga<on  costs  are  comparably  low  for  developing   countries  •  Transfers  to  developing  countries  might  impose  nega<ve  effects  on  long   term  growth  •  Mi<ga<on  might  impose  a  poverty  trap  under  certain  circumstances,   but  further  research  is  needed  !     42  
  43. 43. Thank  you  for  your  a^en2on!      hop://www.pik-­‐potsdam.de/members/steckel

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