Publications – CD-LINKS

New CD-LINKS Research Forecasts High Emitting Countries to Suffer Economic Damages from Climate Change

Novel international study indicates actual cost of global warming will be highest for the three top emitting countries (China, India and US), and globally higher and more unequal than normally assumed. Among the authors, scientists from EIEE (European Institute on Economics and the Environment), the partnership between RFF (Resources for the Future), the energy and environmental economics think tank based in Washington DC, and member of the CD-LINKS consortium CMCC Foundation – Euro-Mediterranean Center on Climate Change. The paper is published in the latest issue of Nature Climate Change.

For the first time, researchers have developed a data set quantifying what the social cost of carbon—the measure of the economic harm from carbon dioxide emissions—will be for each of the globe’s nearly 200 countries, and the results are surprising. The top 3 emitting countries – India, China and the US – have the most to lose from climate change. Gulf countries like Saudia Arabia also score very high.

The findings, led by an international team of scientists and which appear in Nature Climate Change, estimate country-level contributions to the social cost of carbon (SCC) using recent climate model projections, empirical climate-driven economic damage estimations and socioeconomic forecasts. In addition to revealing that some counties are expected to suffer more than others from carbon emissions, they also show the global social cost of carbon is significantly higher than the one typically used.

Among the state-of-the-art contemporary estimates of SCC are those calculated by the U.S. Environmental Protection Agency (EPA). The latest figures range from $12 to $62 per metric ton of CO2 emitted by 2020; however the new data shows that SCC to be approximately $180–800 per ton of carbon emissions. What’s more, the country-level SCC for India, China, US and Saudia Arabia alone are estimated to be above $20 per ton – higher than the carbon prices of the European Trading System – the largest CO2 market in the world.

“We all know carbon dioxide released from burning fossil fuels affects people and ecosystems around the world, today and in the future; however these impacts are not included in market prices, creating an environmental externality whereby consumers of fossil fuel energy do not pay for and are unaware of the true costs of their consumption,” said lead author, UC San Diego assistant professor Kate Ricke. “Evaluating the economic cost associated with climate is valuable on a number of fronts, as these estimates are used to inform environmental regulation and rulemakings.”

In order to model the effects of CO2 emissions on country-level temperatures, the authors use an innovative approach by combining results from several climate and carbon cycle modelling experiments to capture the magnitude and geographic pattern of warming under different greenhouse gas emission trajectories, and the carbon-cycle and climate system response to carbon emissions.

Since carbon dioxide is a global pollutant, previous analysis has focused on the global social cost of carbon; however a country-by-country breakdown of the economic damage global warming will cause is important for various reasons.

“Our analysis demonstrates that the economic costs of climate change will be high in many countries, including ones like the US and Gulf Countries which traditionally have not taken leadership on climate policy” said Massimo Tavoni, Associate Prof. at Politecnico di Milano, Director of EIEE – European Institute on Economics and the Environment and an author of the study. “Moreover, 90% of the world countries will lose from climate, and these impacts will exacerbate global inequality and international tensions. Many countries have not yet recognised the risk posed by climate change. This study aims at filling this gap”.

The authors have harnessed the power of data science by generating hundreds of scenarios spanning socio-economic, climate, and impact uncertainties. This complex space has revealed many clear insights as well as many areas of uncertainty. “Although the ranking of world powers affected by climate change is robust across scenarios, the magnitude of the social cost of carbon is subject to considerable uncertainty” says Laurent Drouet, a senior scientist at EIEE, author of the study and developer of a visual interface which allows navigating the results (//country-level-scc.github.io/explorer/).

The authors noted mapping domestic impacts of climate change can help better understand the determinants of international cooperation. The nationally-determined architecture of the Paris climate agreement—and its vulnerability to changing national interests—is one important example.

Research leading to this paper has been partially supported by the European Research Council (ERC), through the project COBHAM, and the Horizon 2020 project CD-LINKS.

The text of this press release has been republished with permission from EIEE.

Assessing China’s Green Lights Program

For the past 20 years a programme of the Chinese government has been aimed at reducing electricity consumption and facilitating the provision of efficient lighting to consumers, thereby reducing pollution and potentially the demand for new power plants. This programme – the ‘Green Lights Program’ was established in 1996 to promote energy efficiency in lighting due to expected increased demand to the electricity system. Scientists working on the CD-LINKS project have recently published a paper that assessed the impacts of the program and how successful it was, the full paper is available from here and was featured as a Research Highlight in Nature Energy’s journal available from here.

The Green Lights Program resulted in not only environmental benefits but also economic benefits to China and was assessed in the paper by a set of indicators, including electricity savings, consumer savings, production capacity expansion, and export income.

Lead author of the paper, Fei Guo from International Institute for Applied Systems Analysis (IIASA), says: “A unique feature of China’s Green Lights Program that contributed to its considerable success was the strong alignment of energy efficiency and industrial development objectives. This resulted in the policy achieving benefits for people’s pockets, the economy and the environment. This aspect of the policy might provide useful lessons for other developing countries.”

The programme prioritized policy focuses in stages: 1) Stage I (1996–1998) focused on raising the awareness of the general public on ‘high-efficiency lighting products’; 2) Stage II (1999–2006) aimed to promote and regulate the quality of domestic lighting products; 3) Stage III (2007–2010) targeted expediting the diffusion of compact fluorescent lamps (CFLs) by means of financial and mandatory incentives; and 4) Stage IV (after 2010) started to shift the previous program priority from CFLs to emerging light-emitting diode (LED) lighting technologies.

The success of the program can be attributed to five key factors:

Strong and sustained government commitment
Prioritised policy focus by: raising awareness, enforcement of manufacturers to improve product quality, subsidy programmes by the Chinese government and the utilisation of new technologies
Extensive efforts on product quality control
Successful combination of energy efficiency policies with industrial development policies
Combination of distinct and varying incentives

The program helped shape the interdependence of energy efficiency policies with industrial policies. In its conclusions the paper notes that several challenges are evident that the programme needs to address in its next phase. These findings might be of interest to other developing countries who can learn from the experience obtained by the Chinese government in the implementation of its Green Lights Program.

New publication: Living standards lag behind economic growth

13 February 2017

Even as average incomes rise in developing countries, access to sanitation and clean energy have yet to reach the poorest people, a new study shows. But there is room for optimism. Access the paper here.

As incomes rise in developing countries, access to basic amenities such as electricity, clean cooking energy, water, and sanitation, also improves—but not uniformly, and not as quickly as income growth, according to a new study published in the journal Environmental Research Letters. The study looked at historical rates of energy access compared to other living standards and GDP.

“What we found is that income growth alone isn’t enough on its own to get these basic necessities to all people in society,” explains IIASA researcher Narasimha D. Rao, who led the study.

The researchers also found that access to clean cooking energy and sanitation lagged behind access to electricity and water, a finding which has an outsize impact on the poorest members of society, and especially on women.

“Women bear the brunt of health risks that come from cooking with solid fuels, as well as from lack of sanitation, because women are predominantly responsible for cooking and household work,” explains IIASA researcher Shonali Pachauri, who also worked on the study.

The United Nations Sustainable Development Goals (SDGs) aim to achieve universal access to clean energy, water and sanitation by 2030. In order to achieve these goals, the study shows, sub-Saharan Africa in particular would have to see unprecedented rates of improvement compared to historical trends in the region.

The study showed that historically, countries have achieved 80% electrification rates quite quickly, but that getting to 100% can take much longer. Yet some countries, such as Vietnam and Thailand, have managed to improve access faster than earlier adopters like the US. For instance, most countries that embarked on electrification prior to 1970 took from 19 to 27 years to increase access from 20 to 80% of their population, and an additional 20 to 40 years to get to universal access. However, Vietnam and Thailand, which embarked on electrification after 1970, took 15 years to increase access coverage from 20 to 80%, and a further 11 to 20 years to reach full electrification.

“This means there is room for optimism,” says Pachauri.

The study highlights the challenge of achieving the SDGs, but also points to policy directions that could help. “In order to achieve the aims set by the SDGs, policymakers must look at the synergies and dependencies between these different goals, and find ways to combine efforts across sectors to build up infrastructure,” says Rao.

Publication: Can the Green Economy deliver it all? Experiences of renewable energy policies with socio-economic objectives

28 July 2016

A new paper studying the impact of renewable energy deployment on energy access and job creation through four case studies is out by Michael Pahle, Shonali Pachauri and Karoline Stenbacher. Access it here.

Abstract

The Green Economy (GE) paradigm aims to reconcile environmental and socio-economic objectives. Policies to deploy renewable energy (RE) are widely perceived as a way to tap the potential synergies of these objectives. It is, however, still largely unclear whether the potential of simultaneously achieving both environmental and socio-economic objectives can be fully realized, and whether and how multiple objectives influence policy design, implementation, and evaluation. We aim to contribute to this aspect of GE research by looking at selected country experiences of renewable energy deployment with respect to the socio-economic goals of job creation or energy access. Across the cases examined, we find the following implications of relevance for the GE framework: First, we confirm the important role of governmental action for GE, with the specific need to state objectives clearly and build monitoring capacity. Second, consistent with the “strong” green growth variant of GE, some of the cases suggest that while renewable deployment may indeed lead to short-term socio-economic benefits, these benefits may not last. Third, we underline the urgent need for new methodologies to analyze and better understand multiple-objective policies, which are at the heart of the GE paradigm.

New publication shows that country pledges overshoot Paris temperature limit

1 July 2016

Individual country pledges to reduce greenhouse gas emissions would need to be strengthened in order to limit future climate change to well below the 2°C limit included in the Paris climate agreement, states a new assessment in which the CD-LINKS consortium participated. Access the publication here.

Pledges made for the Paris agreement on climate change last winter would lead to global temperature rise of 2.6 to 3.1°C by the end of the century, according to a new analysis published in the journal Nature. In fact, the entire carbon budget for limiting warming to below 2°C might have been emitted by 2030, according to the study.

“The Paris Agreement was a historical achievement for the world’s response to climate change, aiming at limiting warming to below 1.5°C and 2°C. It puts in place a flexible framework for a long-term transformation towards a low-carbon society. But our analysis shows that these measures need to be strengthened in order to have a good chance of keeping warming to well below 2°C, let alone 1.5°C,” says Joeri Rogelj, a researcher at the International Institute for Applied Systems Analysis (IIASA) who led the study.

The 2°C target aimed to limit future climate change to an average temperature increase of below 2°C above preindustrial levels, as research suggested that this could help avoid some of the most dangerous impacts of climate change. The target was agreed upon by 190 countries at the Cancun climate meeting in 2010. In Paris last December, countries strengthened this target by requiring temperatures to be limited to “well below” 2°C and furthermore agreed that they should strive to limit temperature rise even further, to 1.5°C. Some studies suggest that even two degrees of warming would lead to unacceptable impacts, particularly in vulnerable countries such as island nations and least-developed countries.

The new study provides an in-depth analysis of the pledges which countries submitted at the Paris climate meeting in December, the Intended Nationally Determined Contributions (INDCs). In order to assess what would happen after the pledge period ends in 2030, the researchers assumed that emission reduction efforts would be continued at the same level of effort after 2030. Based on these projections, and using a variety of different models, they estimated that median global temperatures would reach 2.6 to 3.1°C by 2100. The researchers also examined what additional measures would be necessary after 2030 to limit future temperature rise to 2°C or 1.5°C in 2100.

Niklas Höhne, a researcher at the NewClimate Institute in Germany and Wageningen University who also worked on the study, says, “To go the rest of the way, we would need to assume much more stringent action after 2030, which leads to emissions reductions of about 3-4% per year globally. But in practice, switching to such stringent reductions right after 2030 would be challenging, and require time—that means that in order to ensure a chance of meeting these targets, we need significant further action from countries before 2030.”

The study also provides a careful analysis of the uncertainties surrounding future emissions and temperature targets. For one thing, the emissions reductions from the INDCs remain uncertain, since the INDC’s themselves are not consistently framed, and some of the pledges include conditional statements, for example, that a country will only implement ambitious emissions reductions if it receives funding from others. Comparing the possible emission levels that the INDC’s could imply, the researchers found a range of uncertainties of 6 billion tons of CO₂ equivalent, or roughly the entire emissions of the United States in the year 2012.

The other major uncertainty lies in how much temperatures will rise in response to various emission levels. For this reason, temperature targets are often interpreted in terms of probabilities, with the aim to have a 66% likelihood of keeping temperature to below 2°C above pre-industrial levels. The study also found that the same INDCs would only avoid 2.9-3.4°C of warming with a 66% chance and 3.5-4.2°C of warming with 90% chance until 2100.

IIASA Energy Program Director Keywan Riahi says, “Our study clearly shows that the current national (INDC) plans are too incremental and thus inconsistent with the long-term ambition from the Paris agreement. If we want to keep 2°C within reach, we’ll need much more rapid and fundamental changes. The hope is that the post-Paris policy process can deliver this.” The CD-LINKS project will continue to analyze the gap between the current pledges and the 1.5°C and 2°C targets for a better understanding of the challenges and opportunities that lie ahead for closing the gap, both globally as well as on a country level.

Harald Winkler, a researcher at the Energy Research Centre in South Africa, also worked on the article. He says, “While some uncertainties, like the temperature response uncertainty, are virtually irreducible over the coming years, uncertainties about what the INDCs add up to in terms of emissions are not. Immediate future work should therefore focus on a better understanding of what the INDCs mean and how they link to other socio-economic objectives, including the UN Sustainable Development Goals.” The CD-LINKS project will contribute to analyzing the implications of different future emissions pathways on other, non-climate, sustainable development objectives, and vice versa. The project aims to give direction to policy makers on potential synergies and trade-offs of implementing climate and other development policies.

Relevant links:

IIASA press release

Publication: 2°C and SDGs: united they stand, divided they fall?

17 March 2016

Access here the new paper 2°C and SDGs: united they stand, divided they fall? by Christoph von Stechow, Jan C Minx, Keywan Riahi, Jessica Jewell, David L McCollum, Max W Callaghan, Christoph Bertram, Gunnar Luderer and Giovanni Baiocchi.

Abstract

The adoption of the Sustainable Development Goals (SDGs) and the new international climate treaty could put 2015 into the history books as a defining year for setting human development on a more sustainable pathway. The global climate policy and SDG agendas are highly interconnected: the way that the climate problem is addressed strongly affects the prospects of meeting numerous other SDGs and vice versa. Drawing on existing scenario results from a recent energy-economy-climate model inter-comparison project, this letter analyses these synergies and (risk) trade-offs of alternative 2 °C pathways across indicators relevant for energy-related SDGs and sustainable energy objectives. We find that limiting the availability of key mitigation technologies yields some co-benefits and decreases risks specific to these technologies but greatly increases many others. Fewer synergies and substantial trade-offs across SDGs are locked into the system for weak short-term climate policies that are broadly in line with current Intended Nationally Determined Contributions (INDCs), particularly when combined with constraints on technologies. Lowering energy demand growth is key to managing these trade-offs and creating synergies across multiple energy-related SD dimensions. We argue that SD considerations are central for choosing socially acceptable 2°C pathways: the prospects of meeting other SDGs need not dwindle and can even be enhanced for some goals if appropriate climate policy choices are made. Progress on the climate policy and SDG agendas should therefore be tracked within a unified framework.

Publication: Energy sector water use implications of a 2 °C climate policy

17 March 2016

Access here the new paper Energy sector water use implications of a 2 °C climate policy by Oliver Fricko, Simon C Parkinson, Nils Johnson, Manfred Strubegger, Michelle TH van Vliet and Keywan Riahi.

Abstract

Quantifying water implications of energy transitions is important for assessing long-term freshwater sustainability since large volumes of water are currently used throughout the energy sector. In this paper, we assess direct global energy sector water use and thermal water pollution across a broad range of energy system transformation pathways to assess water impacts of a 2 °C climate policy. A global integrated assessment model is equipped with the capabilities to account for the water impacts of technologies located throughout the energy supply chain. The model framework is applied across a broad range of 2 °C scenarios to highlight long-term water impact uncertainties over the 21st century. We find that water implications vary significantly across scenarios, and that adaptation in power plant cooling technology can considerably reduce global freshwater withdrawals and thermal pollution. Global freshwater consumption increases across all of the investigated 2 °C scenarios as a result of rapidly expanding electricity demand in developing regions and the prevalence of freshwater-cooled thermal power generation. Reducing energy demand emerges as a robust strategy for water conservation, and enables increased technological flexibility on the supply side to fulfill ambitious climate objectives. The results underscore the importance of an integrated approach when developing water, energy, and climate policy, especially in regions where rapid growth in both energy and water demands is anticipated.