Addressing%20the%20climate%20change%20challenge%20in%20APEC

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Addressing the climate change challenge in APEC
Melanie Ford Don Gunasekera
Australian Bureau of Agricultural and Resource
Economics
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Framework for analysis -GTEM

• Global Trade and Environment Model
• multiregion (bilateral trade flows)
• multisector
• dynamic
• computable
• general equilibrium
• model of the world economy

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GTEM

• Core economic systems
• Population module
• Emissions module

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Regions in GTEM 87, aggregated for
particular application
1 Argentina 10 Korea, Republic of 2 Australia
11 Mexico 3 Brazil 12 Russian
Federation 4 Canada 13 South Africa
5 China 14 United States 6 European Union
(25) 15 Rest of SE Asia 7 India 16 Rest of
CIS 8 Indonesia 17 Chinese Taipei 9 Japan
18 Rest of the world
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Sectors/commodities in GTEM
67, aggregated for particular application 1 Brown
coal 13 Food processing 2 Coking coal 14
Other manufacturing 3 Thermal coal 15
Electricity 4 Oil 16 Water
transport 5 Gas 17 Air transport 6 Other
minerals 18 Other transport 7 Iron
steel 19 Other services 8 Nonferrous
metals 20 Agriculture 9 Nonmetallic
minerals prod. 21 Forestry fisheries 10
Chemicals, rubber plastic 11 Wood,
pulp paper 12 Petroleum coal products

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General equilibrium

• Optimising behaviour
• Commodity markets clear globally
• Factor markets clear regionally
• Financial markets clear globally

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Numerical implementation

• flexible model closures
• enhanced GTAP database
• 2001 base year historical numbers to 2005
• GEMPACK implementation

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Greenhouse module

• carbon dioxide
• nitrous oxide
• methane
• HGWPs
• energy non-energy emissions

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Interpretation of GTEM results
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Key results

• Macro Carbon price/Emissions outcome,
  GNP, GDP, exchange rate, real wage
• Sectoral Output, employment, exports,
  imports
• Other Policy interaction effects, sources
  of welfare gains/losses

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Overview

• 1. Assess the role of cleaner technologies in
  mitigating emissions and addressing other
  economic, energy security and social development
  goals in APEC
• no land use change emissions
• 2. Potential role of emissions mitigation in
  forestry

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APEC economies

• APEC economies currently account for
• 61 per cent of global economic output
• 60 per cent of global energy consumption
• 58 per cent of global GHG emissions
• 41 per cent of global population
• APEC actions are driving regional and global
  economic, social and environmental outcomes.

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Technology addressing the climate change
challenge in APEC

• Aim of analysis What is the role of advanced,
  cleaner technologies in APEC on
• energy consumption fuel mix
• electricity generation fuel mix
• greenhouse gas emissions

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Scenario assumptions

• developed plausible APEC and global technology
  pathways to 2050 in a world committed to reducing
  emissions
• enhanced development and uptake
• more energy efficient currently available
  future technologies
• advanced lower emissions technologies
• APEC, global and economy-wide uptake from 2010

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Key technologies
electricity advanced coal and gas advanced lower cost renewables and nuclear CCS from 2020
transport more efficient ICEs hybrids biofuels
households and buildings more efficient end-use energy consumption CFLs LEDs heating and hot water better building design

• pathway differs by region and sector

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Full range of measures needed

• address barriers to uptake development of
  currently available and plausible future advanced
  technologies
• carbon pricing
• RDD funding
• regulatory arrangements
• technology partnerships
• international collaboration
• IP regimes
• information
• education and training campaigns
• adaptation strategies
• better understanding of costs and benefits

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APEC energy consumption, reference case
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APEC emissions, reference case
total APEC
low income APEC
high income APEC
Gt CO2-e
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APEC energy consumption
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APEC electricity fuel mix
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APEC emissions
reference case
-49 per cent
enhanced technology
Gt CO2-e
short term currently available techs long term
advanced techs
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Emissions in low income APEC
reference case
enhanced technology
Gt CO2-e
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Emissions in high income APEC
reference case
enhanced technology
Gt CO2-e
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APEC electricity emissions
reference case
enhanced technology
Gt CO2-e
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APEC emissions abatement enhanced technology
scenario
470 Gt CO2-e 28 decline
Gt CO2-e
electricity emissions allocated to end users
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APEC GHG emissions by end use sector at 2050,
percentage contribution
Enhanced technology
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Mitigation potential in forestry

• Globally, deforestation accounts for about 18-25
  per cent of anthropogenic emissions
• However, carbon sequestration in forestry can
  play an important role in reducing GHG emissions
  through afforestation, reforestation, reduced
  deforestation and improved forest management
• APEC accounts for 54 per cent of worlds total
  forest area
• APEC has recently experienced a net increase in
  forest area, which is a reversal of historical
  trends
• Investment in forest plantations in China is
  driving this trend also United States, Viet Nam,
  Chile and New Zealand
• Largest recent declines in forest area have
  occurred in Indonesia and Mexico agriculture,
  infrastructure expansion and logging

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Emissions from forestry in APEC,reference case
Mt CO2
2010 2030 2050
Total APEC -22 -72 -264
North America -239 -373 -707
North Asia (including China) -94 -395 -543
South East Asia 129 346 230
Russian Federation 44 19 -78
ABARE projections
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ABAREs analysis

• Focus is on reducing deforestation in tropical
  forest areas in APEC
• trees in tropical forests hold about 50 per cent
  more carbon per hectare than trees outside the
  tropics
• What is the impact of halving the deforestation
  rate in tropical south east Asian APEC economies
  over the period 2009-2050?
• Indonesia, Malaysia, Philippines, Thailand and
  Viet Nam

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Change in forestry emissions in tropical south
east Asian APEC region, reduced deforestation
scenario relative to reference case

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Key messages

• Technology will play the key role in
• reducing energy consumption
• decarbonising energy supply
• reducing GHG emissions
• addressing energy security
• allowing simultaneous achievement of other
  economic and social development goals

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Key messages

• By 2050, emissions in high income APEC economies
  could be well below current levels with enhanced
  technologies
• Need concerted policy action in developed
  developing economies
• Need portfolio of policy options and technologies
  
• Reducing emissions from land use change will also
  play an important role in reducing growth in APEC
  emissions

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Global emissions
reference case
-45 per cent
enhanced technology
Gt CO2-e
short term currently available techs long term
advanced techs
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OECD/transition country emissions
reference case
enhanced technology
Gt CO2-e
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Developing country emissions
reference case
enhanced technology
Gt CO2-e
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OECD/transition country emissions
reference case
enhanced technology
Gt CO2-e
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Global emissions abatement enhanced technology
scenario
765 Gt CO2-e 26 decline
Gt CO2-e
electricity emissions allocated to end users
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Global GHG emissions by end use sector at 2050,
percentage contribution
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Change in APEC energy consumption at 2050,
enhanced technology scenario relative to
reference case
positive energy security implications