a macro-economic assessment - Rivm

ecruhurriedManagement

Oct 28, 2013 (3 years and 11 months ago)

99 views

2
Objectives
￿
Analyse interactionEU air and climatepolicies
considering:
￿
bothend-of-pipeand structuralmeasures
￿
economicfeedback mechanisms
￿
NB: workin progress
3
Economicgeneralequilibriummodel
P
Q
P0
S0
D
Q0
￿
Equilibrium:
supply= demand
4
Economicgeneralequilibriummodel
P
Q
P0
S0
D
Q0
Q1
P1
S1
￿
Environmentalpolicy
￿
=> newequilibrium
5
Economicgeneralequilibriummodel
￿
Markets are linked
P
Q
P0
S0
D
Q0
Q1
P1
S1
6
Economicgeneralequilibriummodel
P
Q
P0
S0
D
Q0
Q1
P1
S1
P
Q
P0
S0
D
Q0
Q1
P1
S1
P
Q
P0
S0
D
Q0
Q1
P1
S1
Demandingcompanies
￿
Markets are linked
7
Economicgeneralequilibriummodel
P
Q
P0
S
D0
Q0
Q1
P1
D1
P
Q
P0
S0
D
Q0
Q1
P1
S1
P
Q
P0
S
D0
Q0
Q1
P1
D1
P
Q
P0
S0
D
Q0
Q1
P1
S1
P
Q
P0
S0
D
Q0
Q1
P1
S1
Supplyingcompanies
Demandingcompanies
￿
Markets are linked
8
Economicgeneralequilibriummodel
policyshock ⇒
￿
changingprices
￿
demandshift
￿
reshufflingof productionstructure
￿
relocationeconomicactivities
￿
newequilibriumin allmarkets
￿
economicfeedbacksincorporated
9
Model used: Worldscan
￿
ComputableGeneral EquilibriumModel forworld
￿
23 regions, 18 sectors
￿
9 EU27, 9 otherAnnex I, Brazil, India, China
￿
electricitysector explicitlyincludesrenewableenergy
technologies
￿
emissions: CO
2, CH
4, N
2O, SO
2, NO
x
(energy& other)
￿
mitigation:
￿
changeproductionstructureand levels
￿
end-of-pipe(CH
4,N
2O,SO
2,NO
x)
10
Data
￿
Annex I, China, India: GAINS databases
￿
GDP, energy, emissions
￿
IEA World Energy Outlook 2009, Reference Scenario
￿
includes "current policy" air pollution control measures
￿
otherregions: post-crisisscenario IMAGE/TIMER
￿
For EU:
￿
end-of-pipeabatementcostcurvesfromGAINS
11
Policysimulations
￿
Air
(SO
2
and NO
x):
￿
NEC2010 in baseline
￿
cost-effective -emission targets 2020 cf. objectives
Thematic Strategy on Air Pollution
￿
cost-benefitmore stringent targets, derivedfromresults
CBAfor CAFE (Holland e.a., 2005)
￿
Climate: post-Copenhagenpledges
￿
low(EU -20%)
￿
emissiontrading onlywithinEU, CDM allowed
￿
high(EU -30%)
￿
emissiontrading Annex-I
12
Macro results2020, EU27
(NB preliminary)
n.a.n.a.
4.5
10.710.7
Average
non-ETSprice
(/ton CO
2)
nationalincome
(% toBAU)
-0.211.8C-eff.High
NEC2010CBAC-eff.NEC2010Air
pollution
Climate
policy
-0.212.1High
0.0
7.78.5
ETS-price
(/ton CO
2)
-0.4-0.2-0.1
LowLow
Policyvariants
Low
13
Emissions2020, EU27
-16.0
-6.9
-38.9-15.6
-3.3
SO
2
emissions
(% toBAU)
-6.1-8.3C-eff.High
NEC2010CBAC-eff.NEC2010Air
pollution
Climate
policy
-4.5-7.5High
-18.0
-5.3-3.3
NO
x
emissions
(% toBAU)
-11.3
-6.2-5.3
GHG
emissions
(% toBAU)
LowLow
Policyvariants
Low
Co-benefitsof air policy
￿
Air pollutionpolicies
￿
end-of-pipeabatement=> noimpact onGHGs
￿
butalso
￿
changesproductionstructure
￿
fuelswitch
￿
energysaving
￿
changesin production/consumptionlevel
￿
=> changein GHGs
structuralchanges
-2.4-2.2-7.7-2.8-2.5
Petroleum,
coalproducts
-0.9-0.7-2.9-0.7-0.5
Energy
intensive
sectors
Transport
-0.7-1.2C-eff.High
NEC2010CBAC-eff.NEC2010Air
pollution
Climate
policy
-0.6-1.2High
-1.9-1.0-0.9
Agriculture
-2.9-0.7-0.6
LowLow
Policyvariants
Low
Air qualityemissiontrading?
￿
Given
￿
importanceeconomicfeedbacks
￿
stronginteractionsbetweenair and climatepolicies
￿
manyuncertainties(economicdevelopment, abatement
cost, etc.)
￿
Key issue: how to set proper air quality targets and
reach flexibility to improve local air quality EU
￿
Flexibilitybetween
￿
countries
￿
gases
17
Conclusions
￿
more stringent targets for air pollutants makeit
more easy toachieveclimatetargets
￿
reductionsin air pollutantsthatare in linewithCBA bring
CO
2-price down
￿
end-of-pipeandproductionstructurerelevant in
achievingfurtherreductionsof air pollutants
￿
stronginteractionsair <=> climatepolicies
18
Conclusions
￿
focus on air pollutants, climate will follow?
￿
air policy: self-interest,short-term, directbenefits,
local/continental
￿
in contrast withclimatechange(long-term, global)
￿
flexibleinstrumentsforair pollutantspoliciesmight
help totakeadvantageof interactionswithclimate
policies
But.
￿
furtheranalyse results
￿
furtherinvestigateflexiblemechanismsforair
pollutionpolicies
￿
introduceexchange ratesbasedonimpact factors
￿
addotherair pollutants(PM, NH
3, VOC)