Transcript Coupling Carbon Processes and Economics

Coupling Carbon
Processes and
Economics
Michael Obersteiner
IIASA
Regional Carbon Budgets: From methodologies to
quantification.
Beijing, China, 15-18 November 2004
Overview
• Motivation to manage the carbon cycle
– Financial Analyst´s point of view
• Scenarios of what needs to be done
– What is the biospheric contribution
• More trade offs than synergies
Effective compliance with Art. 2 UNFCCC!?
Risk analysis… the Chartist
Ericsson
Nokia
Siemens
Siemens
Ericsson
Nokia
Buy
Gold
Data is from the climate system!!!
GISP and IPCC data, own calculations
Abrupt
Chang
e
High volatility
Concentration
s
Growing
No
Analogue
Level&speed
The obvious
number!?
371, ….550,….750…?
Which number would you pick…..?
Gold from Science?
• IPCC for the 4th assessment emission
scenarios that lead to concentrations of <450
are not planned
• No low emission climate runs
• No benchmark
Climat
e
Climate Risk Management Ostriching?
• Stabilization target is a
SOCIAL
CONSTRUCTION
– Plausibility of
stabilization targets
• Little preparation
How to stabilize atmospheric CO
concentrations
2
• Use less energy
– Improve energy efficiency
– Life style changes
– Stabilize population
• Use other forms of energy
– Natural gas instead of coal
– Renewables
– Nuclear
• Capture and store carbon
– From fossil fuels and/or biomass (in energy conversion plants)
– From the atmosphere (in trees, soils or in CO2 capture facilities)
Spatial Distribution of GDP
• Important inputs to the spatially explicit forestry and
regional agricultural model
• Necessary information for vulnerability, adaptation
and impact assessment
The cost to stabilise the atmosphere
Global GDP
250
Trillion USD/yr
200
Bau
150
350 ppm
450 ppm
100
550 ppm
50
0
1990
2000 2010
2020
2030
2040 2050
2060
2070
2080 2090
2100
Year
Source Azar & Schneider, 2002. Ecological Economics
A2-Stabilization Scenario
(Fossil Intensive)
46000
36000
Mitigation of CO2, CH4,
N2O and other GHGS
Total GHG Emissions (MtC equiv.)
56000
26000
16000
6000
-40002000
2020
2040
2060
2080
Industry
Agriculture
Energy
2100 Forest
emissions
(negative)
• The figure shows
the various sources
of GHGs and the
mitigation achieved
from the baseline in
the A2 mitigation
scenario
• Energy represents
the top sector for
potential mitigation
• Sinks contribute
significantly in
reduction of forest
CO2
CO2-concentration 350 ppm, with capture
Carbon storage possibilities
130 – 500 Gton C
with structural traps
30 – 650 Gton C
Herzog et al Scientific American, February 2000.
Enhanced oil recovery
20 – 65 Gton C
Grimston et al (2001).
Input
• Biophysical
– Climate, CO2
etc…
– Land Cover
– Relief
Modeling
Management
options applied
Forest and
agri growth
modeled
• Socioeconomic
– Population
– GDP
– Forest sector
Output
Land values
LU competition
1. LUC
2. C sequestration/GHGs
3. Bio4BE production
INTEGRATED POLICY FRAMEWORK
National Economic Models
Market
Regional Forest Models
Farm Models
Stand level Models
Georeferenced
Database
Regional Farm
Type Models
•
•
•
•
•
•
•
•
•
•
Common Database and Data Structure
Harmonized System Boundaries
IPCC GPG and /or FGA Accounting
Consistent Baseline Assumptions
Joint Catalogue of GHG Mitigation Measures
Uniform Validation Criteria
Agreed Sustainability Constraints
Common IT Standards
Standard Scenario Assumptions and Story Lines
Joint Vision
Common Database
and Standards
Model for GHG Response to Management
Scenario
EPIC simulates many processes:
Weather: simulated or actual
Hydrology: evapotranspiration, runoff,
percolation, 5 PET equations,...
EPIC
Erosion: wind and water, 6 erosion equations,...
Carbon sequestration: plant residue, manure,
Evaporation
leaching, sediment, ...
and
Transpiration
Crop growth: NPK uptake, stresses, yields,
Rain, Snow,
Chemicals
N-fixation,...
Fertilization: application, runoff, leaching,
mineralization, denitrification, volatilization,
Subsurface
nitrification,...
Flow
Surface
Tillage: mixing, harvest efficiencies,...
Flow
Irrigation and furrow diking,...
Drainage: depth,...
Pesticide: application, movement,
Below Root
degradation,...
Zone
Grazing: trampling, efficiency,...
Manure application and transport,...
Crop rotations: inter-cropping, weed,
on a daily time step
competition, annual and perennial crops,...
Geography of Analysis
Soil HRU
Topography HRU
Climate HRU
etc.
Intersection
EPIC HRU
PICUS 2.0
Overview of the Regional Agri-Model
Data
(FADN)
- Yields
- Area
- Variable costs
- Producing activities
- Size of farms
- Altitude
-…
Other sources
- Emissions coefficients
- Soils characteristics
- Fertilizer uses and
prices
-…
Estimation
Typology
15 countries, 101
regions
734 farm-types
Calibration
Model inputs
- Prices
- Technical parameters
- CAP-related parameters
734 models
Maximize gross margin
Subject to :
- Technical constraints
- Policy constraints
Model output
- Optimal area
- Livestock numbers
- Animal feeding
- Net emissions
Basic Modeling
Forestland
Forest
Production
Biofuel/GHG
Demand
Cropland
Water
Labor
Crop
Production
Natl. Inputs
Markets
Domestic
Demand
Export
Processing
Import
Other
Resources
Pasture Land
AUM Grazing
Livestock
Production
Feed
Mixing
Mitigation Strategy Equilibrium
Carbon price ($/tce)
500
Afforestation
400
300
CH4
N2O
Biofuel
offsets
Ag-Soil
sequestration
200
100
0
0
20
40
60
80
100
120
140
160
Emission reduction (mmtce)
180
200
Afforestation in B1
Carbon Sequestration
Total Carbon Supply: B1/A2
Cumulative C-sequestration potential in B1
Cumulative C-sequestration potential in A2
350
300
2010
300
2010
250
2020
2030
2040
250
2020
2030
2040
200
2050
2060
150
100
C-price [$/tC]
C-price [$/tC]
350
200
100
2070
2080
50
0
0
100
200
GtC
300
400
2090
2100
2050
2060
150
2070
2080
50
0
-100
0
100
GtC
200
300
2090
2100
Bioenergy Supply for 2000-2100
B1 (Price < 6$/GJ)
Land Use Change until 2100 for B1
Intensity map: (affected) ha x C-uptake
Existing forest
Afforestation
Deforestation
Wrap-up
• Slumbering Beast
• Much lower stabilization targets are
NECESSARY AND PLAUSIBLE
• The Problem is currently with the fossil
fuels and a large(st) potential of the solution
is in the Agri&Forestry&Bioenergy sector.
Winning is not easy
56000
46000
36000
Mitigation of CO2, CH4,
N2O and other GHGS
Total GHG Emissions (MtC equiv.)
• Carbon price (tax or
cap-and-trade system)
• Energy efficiency
standards
• Support technology
development
• Agi&Forestry market
reform
• Minimize associated
social and environmental
costs
26000
16000
6000
-40002000
2020
2040
2060
2080
Industry
Agriculture
Energy
2100 Forest
emissions
(negative)
35
30
25
20
GW
15
10
5
0
1980
1990
2000
371, ….550,….750…?
THANK
YOU!
Climate Policy
Sector Policy /
Technology
Energy Market
Policy
Electricity
Electricity
Carbon permit
Pulp / paper
Biomass
Land use Policy
Modular Commitment Strategy
CO2
El
BM
\pi
EPIC
Diversity of Approaches
Evaporation
and
Transpiration
Rain, Snow,
Chemicals
Surface
Flow
• Engineering models &
Biophysical Model
• Equilibrium Approaches
(Static – Dynamic)
• Spatially Explicit and
Multisectoral
• Risk and Uncertainty
Augmented
Below Root
Zone
Subsurface
Flow
Goal
• Contribute to integrate sinks in ETS
– GPG (accounting, certification, verification)
– Cost competitiveness and potentials
– Transaction Cost
• Contribute to policy formulation
–
–
–
–
–
–
CAP
Energy
Climate
Forestry
Clean Air
…
Policy Integration