The globalization of the carbon market: Welfare and competitiveness effects of linking emissions trading schemes

In the light of the prevailing goal to keep global temperature increase below 2° and recent challenges to reach a global climate agreement in the near term, linking emissions trading schemes has emerged as a prominent complementing policy option. To this end, we explicitly assess (1) the macroeconomic welfare impacts and (2) the trade-based competitiveness effects of linking the European Union (EU) Emissions Trading Scheme in the year 2020. A stylized partial market analysis suggests that, independently of regional cost characteristics, the integration of emissions trading schemes (ETS) yields economic welfare gains for all participating regions. A computable general equilibrium analysis confirms these findings at the macroeconomic level: The economic efficiency losses from emissions regulation are diminished for both EU Member States and non-EU regions by linking ETS. However, the quantitative analysis suggests opposite trade-based incentives for linking up: while EU Member States improve their terms of trade by integrating with emerging ETS, non-EU linking candidates face competitiveness losses by linking. We conclude that, for non-EU regions, the attractiveness of linking ETS is a matter of priorities for economic welfare or international competitiveness. If these priorities are hierarchized in favor of welfare, the globalization of the carbon market could become a promising policy option complementing the efforts to reach a global climate agreement in 2015.     

Linking the emissions trading schemes of Europe and China - Combining climate and energy policy instruments

Both Europe and China have announced targets for greenhouse gas emissions reduction and renewable energy development. To achieve their emissions targets, Europe has introduced emissions trading scheme (ETS) since 2005 and China has planned to establish a national ETS in 2015. We assess the impact of a joint Europe-China ETS when both climate and energy policy instruments are simulated in a multiregional general equilibrium model. Our results show that a joint ETS markedly increases total carbon emissions from fossil fuels even though global mitigation costs are reduced. Moreover, a joint ETS helps China achieve its renewable energy target, but for Europe, it works opposite. While the renewable energy target does not help Europe achieve additional abatement, the renewable energy target in China reduces mitigation costs and emissions, and increases renewable energy consumption and sales of carbon allowances. Financial transfer through a joint ETS remains marginal compared to China’s demand for renewable energy subsidies. We conclude that as long as an absolute emissions cap is missing in China, a joint ETS is not attractive for mitigation and China’s renewable energy target can reduce emissions.     

碳税对于发展非化石能源的作用 ——基于能源-环境-经济模型的分析

为评价实现我国2020年碳排放强度和非化石能源发展目标的经济和环境影响,论文应用基于动态CGE模型的中国能源-环境-经济模型,模拟了不同减排政策下的减排效果及经济影响。模拟结果显示,征收40元/t CO₂碳税,将碳税作为政府收入、 居民收入、 削减影响较大行业的生产税、 以及用于非化石能源投资,2020年所能实现的减排量分别相当于CO₂排放强度在2005年的基础上下降35.87%、 35.80%、 35.07%和40.13%,非化石能源的消费量将占到总消费量的10.99%、 11.00%、 10.75%和15.82%。政策情景下对经济的影响并不是十分显著,GDP的损失不超过0.2%。综合考虑到减排效益和经济影响,将碳税收入用作对非化石能源的投资,不仅有利于促进我国实现2020年碳排放强度目标,而且对于实现非化石能源发展目标也发挥着重要的作用。     

Cost-effectiveness of greenhouse gases mitigation measures in the European agro-forestry sector: a literature survey

Over the last 20 years, climate change has become an increasing concern for scientists, public opinions and policy makers. Due to the pervasive nature of its impacts for many important aspects of human life, climate change is likely to influence and be influenced by the most diverse policy or management choices. This is particularly true for those interventions affecting agriculture and forestry: they are strongly dependent on climate phenomena, but also contribute to climate evolution being sources of and sinks for greenhouse gases (GHG). This paper offers a survey of the existing literature assessing cost-effectiveness and efficiency of greenhouse gas mitigation strategies or the effects of broader economic reforms in the agricultural and forestry sectors. The focus is mainly on European countries. Different methodological approaches, research questions addressed and results are examined. The main findings are that agriculture can potentially provide emissions reduction at a competitive cost, mainly with methane abatement, while carbon sequestration seems more cost-effective with appropriate forest management measures. Afforestation, cropland management and bioenergy are less economically viable measures due to competition with other land use. Mitigation policies should be carefully designed either to balance costs with expected benefits in terms of social welfare. Regional variability is one of the main drawbacks to fully assess the cost-effectiveness of different measures. Integration of models to take into account both social welfare and spatial heterogeneity seems to be the frontier of the next model generation.     

Integrated scenario modelling of energy,greenhouse gas emissions and forestry

Preventing dangerous climate change requires actions on several sectors. Mitigation strategies have focused primarily on energy, because fossil fuels are the main source of global anthropogenic greenhouse gas emissions. Another important sector recently gaining more attention is the forest sector. Deforestation is responsible for approximately one fifth of the global emissions, while growing forests sequester and store significant amounts of carbon. Because energy and forest sectors and climate change are highly interlinked, their interactions need to be analysed in an integrated framework in order to better understand the consequences of different actions and policies, and find the most effective means to reduce emissions. This paper presents a model, which integrates energy use, forests and greenhouse gas emissions and describes the most important linkages between them. The model is applied for the case of Finland, where integrated analyses are of particular importance due to the abundant forest resources, major forest carbon sink and strong linkage with the energy sector. However, the results and their implications are discussed in a broader perspective. The results demonstrate how full integration of all net emissions into climate policy could increase the economic efficiency of climate change mitigation. Our numerical scenarios showed that enhancing forest carbon sinks would be a more cost-efficient mitigation strategy than using forests for bioenergy production, which would imply a lower sink. However, as forest carbon stock projections involve large uncertainties, their full integration to emission targets can introduce new and notable risks for mitigation strategies.     

Greenhouse gas scenarios for Austria: a comparison of different approaches to emission trends

In the present paper, national and externally organized projections of greenhouse gas emissions for Austria were compared to gain insight on the underlying scenario data assumptions. National greenhouse gas emission trends extend until 2030, an assessment of European Union (EU) countries to 2050. In addition, data for 2000–2100 was extracted from the global emission database described by the Representative Concentration Pathways (RCP). By identifying trends in these projections, it was possible to produce (a) a long-term assessment of national scenarios until 2100, (b) an assessment of the ambition level toward national climate strategies, and (c) a standardized method to compare trends across countries. By extracting RCP data, Austrian’s methane, nitrous oxide, and carbon dioxide emissions up to 2100 could be projected for all sources as well as specific sectors. With respect to the RCP scenario emission data, national projections did not seem to employ the mitigation potentials available for the most stringent RCP scenario, RCP2.6. Comparing projections that supported the EU Climate Strategy 2030 with national projections revealed similar trends. Because RCP2.6 is the only scenario consistent with a 2 °C global warming target, and it is much more ambitious than any of the national or European projections, further measures will be required if Austria is to adequately contribute to this widely accepted policy goal.     

Climate Change Policy in European Countries and its effects on industry

In this paper we discuss the effects ofdifferent climate change policies onindustrial activity and on welfare. Wecompare the effects of carbon taxes andgrandfathered permits and the effects ofexemptions for energy-intensive industries.We survey first the insights from economictheory and from model experiments for theUS. Next we use a general equilibrium modelto assess the effect of different climatechange policies on industrial activity persector and per member country in the EU. Wepay particular attention to the effects ofpolicies where one EU member state exemptsits energy-intensive sectors from abatementefforts. The main findings are that, in theEU, the effects on industrial activity andthe welfare costs of tradable permits orcarbon taxes are small when no industrialsectors are exempted. When one membercountry exempts its energy intensivesector, this will reduce somewhat theimpact on its activity level but willgenerate an extra welfare cost for theEU.     

Major challenges of integrating agriculture into climate change mitigation policy frameworks

Taking the European Union (EU) as a case study, we simulate the application of non-uniform national mitigation targets to achieve a sectoral reduction in agricultural non-carbon dioxide (CO₂) greenhouse gas (GHG) emissions. Scenario results show substantial impacts on EU agricultural production, in particular, the livestock sector. Significant increases in imports and decreases in exports result in rather moderate domestic consumption impacts but induce production increases in non-EU countries that are associated with considerable emission leakage effects. The results underline four major challenges for the general integration of agriculture into national and global climate change mitigation policy frameworks and strategies, as they strengthen requests for (1) a targeted but flexible implementation of mitigation obligations at national and global level and (2) the need for a wider consideration of technological mitigation options. The results also indicate that a globally effective reduction in agricultural emissions requires (3) multilateral commitments for agriculture to limit emission leakage and may have to (4) consider options that tackle the reduction in GHG emissions from the consumption side.     

Increasing the application of gas engines to decrease China’s GHG emissions

This paper employs a review of the technical literature to estimate the potential decrease in greenhouse gas (GHG) emissions that could be achieved by increasing the application of gas engines in China in three sectors: urban public transport vehicle; shipping; and thermal power plants. China’s gas engine development strategies and three types of gas resource are discussed in the study, which indicates that gas engines could decrease GHG emissions by 520 megatonnes (Mt) of carbon dioxide equivalent (CO_2e) by 2020. This would account for 9.7 % of the government’s target for decreasing GHG emissions and is dominated by methane recovery from the use of coal mine gas (CMG) and landfill gas (LFG) for power generation. In the public urban transport vehicle and shipping sectors the low price of natural gas and the increasing demand for the control of harmful emissions could spur the rapid uptake of gas engine vehicles. However, the development of CMG- and LFG-fuelled power plants has been limited by the unwillingness of local enterprises to invest in high-performance gas engine generators and the associated infrastructure. Therefore, further compulsory policies that promote CMG use and LFG recovery should be implemented. Moreover, strict regulations on limiting methane leakage during the production and distribution of gas fuels are urgently needed in China to prevent leakage causing GHG emissions and largely negating the climate benefits of fuel substitution. Strategies for increasing the application of gas engines, promoting gas resources and recovering methane in China are instrumental in global GHG mitigation strategies.     

基于投入产出的中国行业碳排放及减排效果模拟

基于投入产出模型对中国30个行业的碳排放和相互流动进行评估,在利用双比例尺度法对投入产出数据进行更新的基础上,针对不同目标情景下的行业减排效果进行模拟。结果表明：1）行业间的碳排放流动普遍存在,30个行业中有24个高碳型,其中12个全过程型、1个表观高碳型和11个传导型;2）碳排放流动网络中的关键节点行业有煤炭采选业、石油天然气采选业、化学产品业、金属冶炼和压延加工业、电力生产供应业和交通运输仓储邮政业,其处于网络中心地位;3）行业间技术经济联系变动引起的减排幅度为12.43%,最终需求规模上升引起碳排放上升幅度在70%~90%左右;生产排放系数下调10%的减排效果为8.76%,下调15%带来的可能减排效果为13.14%。通过行业减排目标控制的减排政策效果不太显著,但随着政策目标的严格程度上升有所改善。研究结论有利于中国差异化行业减排对策的制定。     

国际贸易“碳中和”研究热点领域及其动向

碳中和是世界各国面临的共同问题。经济全球化与贸易自由化背景下国际贸易总量快速增长,伴随着深度国际分工与产业转移,贸易产品的生产者与消费者在陆表形成严重的空间位移。利用文献计量软件CiteSpace分析国际贸易主题下碳中和相关文献,揭示国际贸易“碳中和”研究动向。研究发现：（1）温室气体在全球范围时空演变,使跨区域、多尺度的全球碳治理变得更加复杂,发达国家将高污染与低价值链产业转移至各发展中国家,以生产者责任划分的碳核算原则不再适用于国际贸易合作。（2）进出口贸易逐渐成为新兴经济体经济发展动力,全球碳治理应转向新兴经济体与区域一体化,全球气候政策设计应遵守国际碳市场公平性底线,不断优化碳排放量核算体系,完善碳会计方法,模拟全球碳减排预期效果。重点提高产业部门碳减排意识和产业清洁技术及能源利用效率,利用多种手段改变生态系统的增汇减碳能力。新兴经济体在承接发达国家技术援助同时,应重点关注本国能源产业,发展可再生能源产业,提高能源的利用效率,并运用经济政策与金融工具促进本国的气候变化投融资产业发展。全球碳治理应更加注重公平性与国家间的经济发展、环境资源差异,利用多样的碳治理工具与协商合作方式,促使更多国家参与全球化或区域一体化的碳治理模式。（3）中国亟待通过国内多产业、多部门的增汇减排与国际碳减排、碳中和实践,健全碳市场机制,提高碳治理水平,为国际碳治理合作提供“最大公约数”。     

The potential of water markets to allocate water between industry,agriculture, and public water utilities as an adaptation mechanism to climate change

One of the climate change scenarios that have been developed for the Netherlands predicts hotter and drier summers and a substantial drop in river discharge. This might lead to water scarcity with detrimental economic and environmental effects. Among the possible adaptation responses to climate change-induced water scarcity, the re-allocation of water resources among competing uses should also be considered. In this paper, we extend and apply a computable general equilibrium (CGE) model to assess the potential of water markets (water allocation according to its shadow price) to guide the allocation of scarce water across agriculture, manufacturing, and public water supply. We develop four scenarios in which the scope of water markets is increased from industry-specific to economy-wide. The results show that the agricultural sector bears nearly all of the losses from a new water-scarce climate, while the manufacturing sectors are able to mitigate their losses to a large extent by technical measures. Extending the scope of water markets unambiguously increases economic output and results in a re-allocation of water to the manufacturing sector from the agricultural sector and from public water services. If, perhaps for political reasons, public water services are excluded from water trading, water is re-allocated from agriculture to manufacturing. Depending on which sectors are included, the construction of a water market can have negative or positive effects on a sector’s output, and although the implementation of water markets may be positive for overall economic output and can hence assist adaptation, the effect on vulnerable or societally sensitive economic sectors, such as public water, should be taken into account when implementing such a market.     

An integration of net imported emissions into climate change targets

There is an international divide between net emissions importers and net emissions exporters, with industrialised nations mainly falling into the former and emerging economies the latter. Integrating emissions transfers into climate policy, so as not to disadvantage export-intensive countries, has been suggested to increase participation in international emissions reduction commitments. Consumption-based scenarios are presented for the UK identifying the geographic and sectorial source of emissions to meet future consumer demands given the current international climate policy landscape. The analysis is applied to the UK yet the discussion is applicable to international climate policy; assigning national responsibility for global emissions reductions; and extending the mitigation potential for net importing countries. Two trajectories for UK consumption emissions are calculated in which (1) international reduction targets are consistent with those pledged today equating to four degrees of temperature rise and (2) international reduction targets achieve a two degree future. By 2050 it is estimated that UK consumption emissions are 40–260% greater than UK territorial emissions depending on the strength of global reduction measures, and assuming the UK meets its 80% reduction in 1990 emissions by 2050 target. Cumulative emissions are presented alongside emissions trajectories, recognising that temperature rise is directly related to every tonne of carbon emitted. Whilst this paper argues that the current UK emissions targets underestimate the UK's contribution to global mitigation for two degrees, it shows how expanding the focus of policy towards consumption introduces new opportunities for reduction strategies at scale. The paper advocates the implementation of consumption-based emissions accounting which reveals underexploited policy interventions and increases the potential to break down barriers that exist between industrialised and emerging economies in international climate policy.     

气候政策研究中的数学模型评述

按照成本分析和综合分析2个层次，分别介绍了投入产出模型、可计算一般均衡模型、宏观计量经济模型、工程经济模型、动态能源优化模型、能源系统模拟模型、综合评估模型等不同模型方法的特点及其在气候政策分析中的应用。指出可计算一般均衡模型是应用得最为广泛的方法之一。概括了气候政策模型研究的4个发展趋势，包括加强综合评估模型的应用、扩展成本与效益的内涵、注重不同模型之间的比较、强调不确定性分析。结果中国研究现状，分析了当前面昨的问题，认为国内气候政策模型研究与中国在国际气候变化领域的地位仍不相称，强度要进一步加强研究队伍建设、扩展研究领域、跟踪国际研究前沿问题，以便为国家的气候谈判政策提供更有效的科学依据和决策支持。     

企业碳中和行动的驱动力与模式

碳中和已成为我国气候治理和可持续发展的重要目标。尽管碳中和是国家面向2060年的长期愿景,尚未转换成针对企业的政策约束,但全球很多企业已经快速响应,主动制定自身的碳中和战略。本文从企业环境行为的驱动理论出发,分析了企业做出碳中和承诺的内部和外部驱动因素,论证了企业"化被动为主动"、自主实行碳中和战略,不但有助于在未来更加严格的气候政策规制中获得先机、赢得行业竞争优势、拓宽绿色市场份额、规避可能的经济风险,而且具有体现企业社会责任感、树立良好品牌形象、提升企业创新能力和核心竞争力等积极作用。在此基础上,梳理了能源密集型、资源密集型和高新技术企业的碳中和战略及模式,总结分析了国内企业实现碳中和承诺的机遇和挑战,为国内企业制定零碳发展战略、实现碳中和目标提出了路径建议。     

Oil price scenarios and climate policy: welfare effects of including transportation in the EU emissions trading system

The stringency of policies needed to meet a climate target is influenced by uncertain oil prices because price changes cause emission changes, making the robustness of climate policy instruments important. As a result of its dependence on oil, emissions from the transport sector are particularly sensitive to oil price changes. We use a computable general equilibrium model to study the effects of including the transport sector in the EU??s emissions trading scheme under three future oil price scenarios. Our results show that there are potentially significant welfare gains from including transportation in the emissions trading scheme because the system as a whole helps absorb required changes in climate policy to meet the overall EU cap on emissions. There is, however, a cost in terms of somewhat greater permit price uncertainty.     

Negotiating future climates for public policy: a critical assessment of the development of climate scenarios for the UK

Climate scenarios serve a number of functions in helping society manage climate change—pedagogic, motivational or practical (for example, in engineering design, spatial planning and policy development). A variety of methodologies for scenario construction have been experimented with, all of them to a greater or lesser extent depending on the use of climate models. Yet the development of climate scenarios involves much more than climate modelling. The process of scenario development is one of negotiation between relevant stakeholders—funding agencies, policy communities, scientists, social actors and decision-makers in a variety of sectors. This process of negotiation is illustrated through an analysis of four generations of UK climate scenarios—published in 1991, 1996, 1998 and 2002. Using ideas from science and technology studies and the sociology of scientific knowledge to guide our analysis, we reveal complex relationships between the interests of UK science, policy and society. Negotiating climate scenarios involves compromise between the needs of policy, science and decision-maker in relation to, for example, the selection of the development pathway(s) and emissions scenario(s), the choice of climate model(s), the assessment and communication of uncertainty and the presentational devices used. These insights have a significant bearing on the way in which climate scenarios should be viewed and used in public discourse, strategic planning and policy development.     

Capital assets and institutional constraints to implementation of greenhouse gas mitigation options in agriculture

Agriculture is one of the major sources of greenhouse gas (GHG) emission. It accounts for approximately 15% of the total global anthropogenic emissions of GHGs. Emissions could be twice as much if indirect emissions are also taken into the consideration. However, unlike other high emitting sectors such as transport or energy, agriculture is potentially a significant carbon “sink”. It has high technical potential as a carbon sink and if tapped, can substantially enhance global sequestration efforts. The technical potential, however, may not translate into actual GHG reduction because of the capital assets and institutional constraints faced by the smallholder farmers in the developing countries. In this paper we develop a capital assets based framework of physical, financial, social, human and natural barriers to agricultural carbon mitigation initiatives and through analysis of current initiatives, we set out policy based options to reduce each of these barriers. Fundamentally, barrier removal will entail designing agricultural carbon mitigation initiatives in collaboration with farmer communities, through strengthening local institutions, understanding land tenure and natural resource cultures, ensuring legitimacy and equity in payments and fast tracking training and information. We provide a framework that simultaneously aids the dual objectives of alleviating poverty in the poor farming communities of developing countries and lowering global greenhouse gas emissions.     

Widening the scope of policies to address climate change: directions for mainstreaming

Both mitigation of and adaptation to climate change require actions to be taken in many sectors of society, but so far this is hardly happening. This paper suggests possibilities for widening climate change policy by strengthening inter-linkages between climate policies and various relevant policy areas to mainstream climate change concerns. It argues that, if these inter-linkages can be strengthened and policy coherence is improved, the effectiveness of climate policy can be enhanced while also supporting these other policy areas. The contention in this paper is that improved policy coherence and mainstreaming requires climate policies to go beyond the UNFCCC framework to realise its full potential and to better deal with possible trade-offs. The potential benefits in the policy domains of poverty reduction, rural development and agriculture, disaster management, energy security, air quality and trade, and finance are examined, and the institutional and organisations linkages highlighted. Finally, opportunities for mainstreaming are identified to make better use of possible synergies between climate and related policy areas.