JP

The Association of Large-Scale Climate Variability and Teleconnections on Wind Energy Resource over Europe and its Intermittency

In times of increasing importance of wind power in the world’s energy mix, this study focuses on a better understanding of the influences of large-scale climate variability on wind power resource over Europe. The impact of the North Atlantic Oscillation (NAO), the Arctic Oscillation (AO), the El Niño Southern Oscillation (ENSO) and the Atlantic Multidecadal Oscillation (AMO) are investigated in terms of their correlation with wind power density (WPD) at 80 m hub height. These WPDs are calculated based on the MERRA Reanalysis data set covering 31 years of measurements. Not surprisingly, AO and NAO are highly correlated with the time series of WPD. This correlation can also be found in the first principal component of a Principal Component Analysis (PCA) of WPD over Europe explaining 14% of the overall variation. Further, cross-correlation analyses indicates the strongest associated variations are achieved with AO/NAO leading WPD by at most one day. Furthermore, the impact of high and low phases of the respective oscillations has been assessed to provide a more comprehensive illustration. The fraction of WPD for high and low AO/NAO increases considerably for northern Europe, whereas the opposite pattern can be observed for southern Europe. Similar results are obtained by calculating the energy output of three hypothetical wind turbines for every grid point over Europe. Thus, we identified a high interconnection potential between wind farms in order to reduce intermittency, one of the primary challenges in wind power generation. In addition, we observe significant correlations between WPD and AMO.

The Canadian oil sands industry under carbon constraints

We investigate the impact of climate policies on Canada's oil sands industry, the largest of its kind in the world. Deriving petroleum products such as gasoline and diesel from oils sands involves significant amounts of energy, and that contributes to a high level of CO2 emissions. We apply the MIT Emissions Prediction and Policy Analysis (EPPA) model, a computable general equilibrium model of the world economy, augmented to include detail on the oil sands production processes, including the possibility of carbon capture and storage (CCS). We find: (1) without climate policy, annual Canadian bitumen production increases almost 4-fold from 2010 to 2050; (2) with climate policies implemented in developed countries, Canadian bitumen production drops by 32% to 68% from the reference 4-fold increase, depending on the viability of large-scale CCS implementation, and bitumen upgrading capacity moves to the developing countries; (3) with climate policies implemented worldwide, the Canadian bitumen production is significantly reduced even with CCS technology, which lowers CO2 emissions at an added cost. This is mainly because upgrading bitumen abroad is no longer economic with the global climate policies.

The China-in-Global Energy Model

The China-in-Global Energy Model (C-GEM) is a global Computable General Equilibrium (CGE) model that captures the interaction of production, consumption and trade among multiple global regions and sectors – including five energy-intensive sectors – to analyze global energy demand, CO2 emissions, and economic activity. The C-GEM model supplies a research platform to analyze China’s climate policy and its global implications, and is one of the major output and analysis tools developed by the China Energy and Climate Project (CECP) – a cooperative project between the Tsinghua University Institute of Energy, Environment, and Economy and the Massachusetts Institute of Technology (MIT) Joint Program on the Science and Policy of Global Change. This report serves as technical documentation to describe the C-GEM model. We provide detailed information on the model structure, underlying database, key parameters and its calibration, and important assumptions about the model. We also provide model results for the reference scenario and a sensitivity analysis for two key parameters: autonomous energy efficiency improvements (AEEI) and the elasticity of substitution between energy and value added.

The CO2 Content of Consumption Across US Regions: A Multi-Regional Input-Output (MRIO) Approach

We improve on existing estimates of the carbon dioxide (CO2) content of consumption across regions of the United States. Using a multi-regional input-output (MRIO) framework, we estimate the direct and indirect CO2 emissions attributable to domestically and internationally imported goods. We include estimates of bilateral trade between US states as well as between individual states and international countries and regions. This report presents two major findings. First, attributing emissions to states on a consumption versus a production basis leads to very different state-level emissions responsibilities; for example, when attributed on a consumption basis, California's per capita emissions are over 25 percent higher than when attributed on a production basis. Second, when attributing emissions on a consumption basis, heterogeneity of emissions across trading partners significantly affects emissions intensity. These findings have important implications for evaluating the potential distributional impacts of national climate policies, as well as for understanding differing incentives to implement state- or regional-level policies.

The Contribution of Biomass to Emissions Mitigation under a Global Climate Policy

What will large-scale global bioenergy production look like? We investigate this question by developing a detailed representation of bioenergy in a global economy-wide model. We develop a scenario with a global carbon dioxide price, applied to all anthropogenic emissions except those from land-use change, that rises from $15 per metric ton in 2015 to $59 in 2050. This creates market conditions favorable to biomass energy, resulting in global non-traditional bioenergy production of ~150 exajoules (EJ) in 2050. By comparison, in 2010 global energy production was primarily from coal (139 EJ), oil (175 EJ) and gas (108 EJ). With this policy, 2050 emissions are 16% less in our Base Policy case than our Reference case, although extending the scope of the carbon price to include emissions from land-use change would reduce 2050 emissions by 57% relative to the same baseline. Our results from various policy scenarios show that lignocellulosic (LC) ethanol may become the major form of bioenergy, if its production costs fall by amounts predicted in a recent survey and ethanol blending constraints disappear by 2030; however, if its costs remain higher than expected or the ethanol blend wall continues to bind, bioelectricity and bioheat may prevail. Higher LC ethanol costs may also result in expanded production of first-generation biofuels (ethanol from sugarcane and corn) so that they remain in the fuel mix through 2050. Deforestation occurs if emissions from landuse change are not priced, although the availability of biomass residues and improvements in crop yields and conversion efficiencies mitigate pressure on land markets. As regions are linked via international agricultural markets, irrespective of the location of bioenergy production, natural forest decreases are largest in regions with the lowest political constraints to deforestation. The combination of carbon price and bioenergy production increases food prices by 2.6%–4.7%, with bioenergy accounting for 1.3%–2.6%.

 

Be Cautious about Bioenergy, but Don't Rule It Out

Research commentary by Niven Winchester in response to the World Resources Institute report on biofuels and bioenergy.

A report published by the World Resources Institute (WRI) in January has reignited the old debate over biofuels and other forms of bioenergy, casting doubt on their climate benefits and effects on food availability. With recent low oil prices, and the EPA set to announce updated biofuel standards in the spring, the stakes for considering what role bioenergy will play in a sustainable future are higher than ever.

While the WRI report’s authors outline valid reasons to be cautious about bioenergy, the report contains misleading statements about the role of bioenergy in abating emissions.

The report claims that bioenergy made from fuel crops does not reduce direct carbon emissions because, say, diverting maize from food to ethanol does not result in additional absorption of carbon. While this is true, focusing on direct emissions is short-sighted because it doesn’t take into account the bigger picture of where energy comes from. Regardless of whether maize is used for food or fuel, emissions absorbed will end back into the atmosphere, mainly through respiration in the former and combustion in the latter. However, if maize is used for ethanol, it displaces oil and reduces carbon emissions.

If direct emissions were used to evaluate solar power, this technology would also be judged not to reduce carbon emissions, as no emissions are either stored or released when sunlight is converted to electricity. This is not to say that the carbon benefits from bioenergy are equal to the emissions from the fossil energy that it displaces. Growing bioenergy crops requires energy to plant, harvest and process, and may result in deforestation. Emissions from these activities reduce the carbon benefits of bioenergy, but there is still the potential for it to reduce emissions.

The report also claims that bioenergy analyses double-count land by assuming that biomass for other purposes, like food and lumber, continue to be met when land is used for bioenergy. In fact, studies that consider the economy-wide effects of bioenergy cultivation explicitly represent resource constraints, so land used for bioenergy cannot be used for other purposes. In these studies, as in the real world, increased demand for land to grow bioenergy crops will increase land prices.

The effects of the higher land prices propagate throughout the economy in several ways. Land may be used more intensively by, for example, developing new cultivars. On the other side of the equation, demand for food can be reduced through greater use of refrigeration and packaging to reduce food waste.

That is, incentives for bioenergy can drive efficiency improvements in crop production and use that allow food and fuel demands to be met using limited resources. These efficiency improvements come at a cost, but so do other carbon abatement options.

Bioenergy is not a “silver bullet” against climate change, has been over-hyped in some circles, and governments should guard against negative impacts on water and biodiversity. At the same time, bioenergy should not be erroneously excluded from our toolkit for fighting climate change, because we will need all the tools available to us.

Niven Winchester is an environmental energy economist at the Joint Program on the Science and Policy of Global Change. He is a coauthor of the recent report "The Contributions of Biomass to Emissions Mitigation under a Global Climate Policy."

The Cost of Adapting to Climate Change in Ethiopia

This paper uses spatially-explicit analyses of climate change effects on selected key sectors of Ethiopia’s economy to estimate both sector-wise and economy-wide estimates of impacts and adaptation costs. Using four IPCC-vetted Global Circulation Models (GCMs) to bracket the uncertainty surrounding future climate outcomes, the paper finds that by 2050 climate change could cause GDP to be 8–10 percent smaller than under a no-climate change baseline; it could induce a two-fold increase in variability of growth in agriculture; and it would affect more severely the poor and certain parts of the country. The paper also finds that adaptation to climate change might cost an annual average of USD 0.8–2.8 billion; and an additional USD 1.2 to 5.8 billion if one takes into account residual damages which may not be addressed by adapting existing development plans. The paper also provides sector-specific insights on impacts and adaptation options in agriculture, road transport, and hydropower. In particular, rapid development of Ethiopia’s hydro-potential, upgrading of the road design standards, and gradual diversification of the economy away from the more climate vulnerable sectors are likely to be important elements of any climate-resilient development strategy.

© 2013 International Food Policy Research Institute

The Economic, Energy, and GHG Emissions Impacts of Proposed 2017-2025 Vehicle Fuel Economy Standards in the United States

Increases in the U.S. Corporate Average Fuel Economy (CAFE) Standards for 2017 to 2025 model year light-duty vehicles are currently under consideration. This analysis uses an economy-wide model with detail in the passenger vehicle fleet to evaluate the economic, energy use, and greenhouse gas (GHG) emissions impacts associated with year-on-year increases in new vehicle fuel economy targets of 3%, 4%, 5%, or 6%, which correspond to the initially proposed rates of increase for the 2017 to 2025 CAFE rulemaking. We find that across the range of targets proposed, the average welfare cost of a policy constraint increases non-linearly with target stringency, because the policy targets proposed require increasingly costly changes to vehicles in the near term. Further, we show that the economic and GHG emissions impacts of combining a fuel tax with fuel economy standards could be positive or negative, depending on underlying technology costs. We find that over the period 2015 to 2030, a 5% CAFE policy would reduce gasoline use by about 25 billion gallons per year, reduce CO2 emissions by approximately 190 million metric tons per year, and cost $25 billion per year (net present value in 2004 USD), relative to a No Policy baseline.

The Energy and CO2 Emissions Impact of Renewable Energy Development in China

China’s recently-adopted targets for developing renewable electricity—wind, solar, and biomass—would require expansion on an unprecedented scale in China and relative to existing global installations. An important question is how far this deployment will go toward achieving China’s low carbon development goals, which include a carbon intensity reduction target of 40–45% relative to 2005 and a non-fossil primary energy target of 15% by 2020. During the period from 2010 to 2020, we find that current renewable electricity targets result in significant additional renewable energy installation and a reduction in cumulative CO2 emissions of 1.2% relative to a no policy baseline. After 2020, the role of renewables is sensitive to both economic growth and technology cost assumptions. Importantly, we find that CO2 emissions reductions due to increased renewables are offset in each year by emissions increases in non-covered sectors through 2050. By increasing reliance on renewable energy sources in the electricity sector, fossil fuel demand in the power sector falls, resulting in lower fossil fuel prices, which in turn leads to greater demand for these fuels in unconstrained sectors. We consider sensitivity to renewable electricity cost after 2020 and find that if cost falls due to policy or other reasons, renewable electricity share increases and results in slightly higher economic growth through 2050. However, regardless of the cost assumption, projected CO2 emissions reductions are very modest under a policy that only targets the supply side in the electricity sector. A policy approach that covers all sectors and allows flexibility to reduce CO2 at lowest cost—such as an emissions trading system—will prevent this emissions leakage and ensure targeted reductions in CO2 emissions are achieved over the long term.

The Energy and Economic Impacts of Expanding International Emissions Trading

Emissions trading systems are recognized as a cost-effective way to facilitate emissions abatement and are expected to play an important role in international cooperation for global climate mitigation. Starting from the planned linkage of the European Union’s Emissions Trading System with a new system in Australia in 2015, this paper simulates the impacts of expanding this international emissions market to include China and the US, which are respectively the largest and second largest carbon dioxide (CO2) emitters in the world. We find that including China and the US significantly impacts the price and the quantity of permits traded internationally. China exports emissions rights while other regions import permits. When China joins the EU-Australia/New Zealand (EU-ANZ) linked market, we find that the prevailing global carbon market price falls significantly, from $33 per ton of carbon dioxide (tCO2) to $11.2/tCO2. By contrast, adding the US to the EU-ANZ market increases the price to $46.1/tCO2. If both China and the US join the linked market, the market price of an emissions permit is $17.5/tCO2 and 608 million metric tons (mmt) are traded, compared to 93 mmt in the EU-ANZ scenario. The US and Australia would transfer, respectively, 55% and 78% of their domestic reduction burden to China (and a small amount to the EU) in return for a total transfer payment of $10.6 billion. International trading of emissions permits also leads to a redistribution of renewable energy production. When permit trading between all regions is considered, relative to when all carbon markets operate in isolation, renewable energy in China expands by more than 20% and shrinks by 48% and 90% in, respectively, the US and Australia-New Zealand. In all scenarios, global emissions are reduced by around 5% relative to a case without climate policies.

The Future Energy and GHG Emissions Impact of Alternative Personal Transportation Pathways in China

A major uncertainty in future energy and greenhouse gas (GHG) emissions projections for China is the evolution of demand for personal transportation modes. This paper explores the implications of divergent personal transportation scenarios, either favoring private vehicles, or emphasizing a sector including all purchased transport (including local public transit, rail and aviation) as substitute for vehicle travel. Motivated by a wide range of forecasts for transport indicators in the literature, we construct plausible scenarios with low-, medium- and high-transport demand growth, and implement them in a technology-rich model which represents opportunities for fuel economy improvement and switching to plug-in hybrid-electric vehicles (PHEVs). The analysis compares primary energy use and GHG emissions in China in the absence and presence of climate policies. We find that a policy that extends the current Chinese emissions-intensity goals through 2050 mostly affects other sectors with lower abatement costs, and so only lightly engages household transport, permitting nearly the same large increases in refined oil demand (by more than five times) and private vehicle stocks (to 430–500 million) as in the reference case. A stringent climate stabilization policy affects household transport, limiting vehicle ownership and petroleum demand, but drives up the share of household spending on transport, and carries high economy-wide costs. The large projected scale of vehicle fleets, refined oil use and transport purchases all suggest that the rate and type of travel demand growth deserves attention by policymakers, as China seeks to address its energy, environmental, and economic goals.

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