Climate Policy

Abstract: Bioenergy with carbon capture and storage (BECCS) and afforestation are key negative emission technologies suggested in many studies under 2°C or 1.5°C scenarios. However, these large-scale land-based approaches have raised concerns about their economic impacts, particularly their impact on food prices, as well as their environmental impacts. Here we focus on quantifying the potential scale of BECCS and its impact on the economy, taking into account technology and economic considerations, but excluding sustainability and political aspects.

To do so, we represent all major components of BECCS technology in the MIT Economic Projection and Policy Analysis model. We find that BECCS could make a substantial contribution to emissions reductions in the second half of the century under 1.5 and 2°C climate stabilization goals, with its deployment driven by revenues from carbon dioxide permits. Results show that global economic costs and the carbon prices needed to hit the stabilization targets are substantially lower with the technology available, and BECCS acts as a true backstop technology at carbon prices around $240 per ton of carbon dioxide. If driven by economics alone, BECCS deployment increases the use of productive land for bioenergy production, causing substantial land use changes. However, the projected impact on commodity prices is limited, with global commodity price indices increasing by less than 5% on average, and up to 15% in selected regions.

While BECCS deployment is likely to be constrained for environmental and/or political reasons, this study shows that the large-scale deployment of BECCS is not detrimental to agricultural commodity prices and could reduce the costs of meeting stabilization targets. Still, it is crucial that policies consider carbon dioxide removal as a complement to drastic carbon dioxide emissions reductions, while establishing a credible accounting system and sustainable limits on BECCS.

Summary: The electrification of private cars and light trucks—the vast majority of which are now powered by internal combustion engines (ICEs)—will be critical to efforts to keep global warming well below 2°C or 1.5°C, the long-term goals of the Paris Agreement. Replacing today’s fleet of gasoline and diesel ICEs with plug-in hybrid (PHEV) and battery (BEV) electric vehicles (EVs) could practically eliminate emissions from these light-duty vehicles as part of a broader strategy to decarbonize the transportation sector.

To better understand the potential impact of electric vehicle deployment on total global carbon dioxide emissions, MIT Joint Program researchers enhanced the MIT Economic Projection and Policy Analysis (EPPA) model to represent the fleet dynamics of light-duty vehicles (LDVs) including ICEs, PHEVs and BEVs. Using the enhanced model, they projected global and regional LDV emissions under different climate policy scenarios between the years 2015 and 2050.

The study considered a range of increasingly stringent policy scenarios, from a reference scenario that excludes national pledges delineated in the Paris Agreement to one aligned with the accord’s long-term 2°C goal. The researchers found that as the number of global LDVs grows from 1.1 billion to 1.6-1.8 billion between 2015 and 2050, EV units increase from 1 million to 585-825 million, and thus account for one-third (reference scenario) to one-half (2°C scenario) of the global LDV fleet. Even as the global LDV fleet grows by about 50 percent over the study period, total fleet CO2 emissions decline by about 50 percent under the 2°C scenario (compared to 10 percent in the reference scenario).

The study suggests that the electrification of light-duty vehicles could play an important role in broader efforts to mitigate global climate change, and highlights the caliber of insights that can be gained from including more precise representation of electric vehicle fleet dynamics in economy-wide energy-economic models.

Summary: Aiming to avoid the worst effects of climate change, from severe droughts to extreme coastal flooding, the nearly 200 nations that signed the Paris Agreement set a long-term goal of keeping global warming well below two degrees Celsius. Achieving that goal will require dramatic reductions in greenhouse gas emissions, primarily through a global transition to low-carbon energy technologies. In the power sector, these include solar, wind, biomass, nuclear and carbon capture and storage (CCS). According to more than half of the models cited in the Intergovernmental Panel on Climate Change’s (IPCC) Fifth Assessment Report, CCS will be required to realize the Paris goal, but to what extent will it need to be deployed to ensure that outcome?

A new study in Climate Change Economics led by the MIT Joint Program on the Science and Policy of Global Change projects the likely role of CCS in the power sector in a portfolio of low-carbon technologies. Using the Joint Program’s multi-region, multi-sector energy-economic modeling framework to quantify the economic and technological competition among low-carbon technologies as well as the impact of technology transfers between countries, the study assessed the potential of CCS and its competitors in mitigating carbon emissions in the power sector under a policy scenario aligned with the 2°C Paris goal.

The researchers found that under this scenario and the model’s baseline estimates of technology costs and performance, CCS will likely be incorporated in nearly 40 percent of global electricity production by 2100—one third in coal-fired power plants, and two-thirds in those run on natural gas. The study also found that the extent of CCS deployment, especially coal CCS, depends on the assumed fraction of carbon captured in CCS power plants. Ultimately, the authors determined that the power sector will continue to rely on a mix of technological options, and the conditions that favor a particular mix of technologies differ by region.

Abstract: In this study, we present results from a large ensemble of projected changes in seasonal precipitation and near-surface air temperature changes for the nation of South Africa.

The ensemble is based on a combination of pattern-change responses derived from the Coupled Model Intercomparison Project Phase 5 (CMIP-5) climate models along with the Massachusetts Institute of Technology Integrated Global Systems Model (MIT-IGSM), an intermediate complexity earth-system model coupled to a global economic model that evaluates uncertainty in socio-economic growth, anthropogenic emissions, and global environmental response. Numerical experimentation with the MIT-IGSM considered four scenarios of future climate and socio-economic development to span a range of possible global actions to abate greenhouse gas emissions through the 21st century. We evaluate distributions of surface-air temperature and precipitation change over three regions across South Africa: western (WSoAfr), central (CSoAfr), and eastern (ESoAfr) South Africa.  

In all regions, by mid-century, we find a strong likelihood (greater than 50%) that temperatures will rise considerably higher than the current climate’s range of variability 
(a threefold increase over the current climate’s two-standard deviation range of variability). In addition, scenarios that consider more aggressive global climate targets (e.g. 2C and 15C scenarios) all but eliminate the risk of these acutely salient temperature increases. For precipitation, there is a preponderance of risk toward decreased precipitation (3 to 4 times higher than increased) for western and central parts of South Africa.

There is a clear benefit seen within the evolving hydroclimatic risks as a result of strong climate targets, such as limiting the global climate warming to 1.5˚C by 2100. We find that the risk of precipitation changes in the 15C scenario toward the end of this century (2065–2074) is nearly identical to that seen in the REF scenario during the 2030s. Thus, the climate risk that may be experienced in a decade as a result of current global actions to reduce emissions could be delayed by 30 years, and would provide invaluable lead-time for national efforts to be put in place to prepare, fortify, and/or adapt to these changing environments of risk.

Abstract: The shale gas boom in the U.S. has lowered the U.S. CO2 emissions in recent years mainly through substitution of gas for coal in power generation. Will the shale gas boom reduce the emissions in the long-run as well?

To study this, we consider a counterfactual without the shale gas boom based on a general equilibrium modeling for the 2011 U.S. economy. To enhance the power sector modeling, the supply responses of coal-fired and gas-fired generations are calibrated to existing research. We find that if gas prices remain at 2007 levels in 2011, only a model setting that allows very little reduction in electricity demand, reflecting a short-run demand response, generates an increase in economy-wide emissions. For all other cases, the higher gas price under the counterfactual will have a dampening effect on economic activities and consequently lowers economy-wide emissions, even though the power sector emissions may increase due to the gas-to-coal switch.

In other words, without any policy intervention, although the shale gas boom could reduce emissions in the short run, it may lead to higher emissions in the long run if the low gas prices persist. Our finding suggests that extrapolating the current decline in emissions due to the shale gas boom to the distant future could be misleading. Instead, if curbing emissions is the goal, rather than depending upon the cheap gas, policies and measures for cutting emissions remain imperative.

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