Designing policy for deployment of CCS in industry

Attaining deep greenhouse gas (GHG) emission reductions in industry in order to support a stringent climate change control target will be difficult without recourse to CO₂ capture and storage (CCS). Using the insights from a long-term bottom-up energy systems model, and undertaking a sectoral assessment, we investigated the importance of CCS in the industrial sector. Under climate policy aimed at limiting atmospheric concentration of GHGs to 650 ppm CO₂e, costs could increase fivefold when CCS is excluded from the portfolio of mitigation option measures in the industry sector as compared to when CCS is excluded in the power sector. This effect is driven largely by the lack of alternatives for deep emission reductions in industry. Our main policy conclusion is that a broader recognition of CCS in industrial applications in both current policy discussions and research, development, and demonstration funding programmes is justified. In recognition of the heterogeneity of the many types of industrial production processes, the size and location of industrial CO₂ sources, the specific need for CCS-retrofitting, and the exposure of most industrial sectors to international trade, policies aimed at supporting CCS must distinguish between the different challenges faced by the power and industrial sectors.     

Carbon dioxide capture and storage: a status report

Abstract

Fossil fuel combustion is the largest source of anthropogenic greenhouse gas (GHG) emissions. As a result of combustion, essentially all of the fuel carbon is emitted to the atmosphere as carbon dioxide (CO₂), along with small amounts of methane and, in some cases, nitrous oxide. It has been axiomatic that reducing anthropogenic GHG emissions requires reducing fossil-fuel use. However, that relationship may no longer be as highly coupled in the future. There is an emerging understanding that CO₂ capture and storage (CCS) technology offers a way of using fossil fuels while reducing CO₂ emissions by 85% or more. While CCS is not the ‘silver bullet’ that in and of itself will solve the climate change problem, it is a powerful addition to the portfolio of technologies that will be needed to address climate change. The goal of this Commentary is to describe CCS technology in simple terms: how it might be used, how it might fit into longer term mitigation strategies, and finally, the policy issues that its emergence creates. All of these topics are discussed in much greater detail in the recently published Intergovernmental Panel on Climate Change (IPCC) Special Report on Carbon Dioxide Capture and Storage (SRCCS) (IPCC, 2005).     

Dangerous anthropogenic interference, dangerous climatic change, and harmful climatic change: non-trivial distinctions with significant policy implications

Article 2 of the United Nations Framework Convention on Climate Change (UNFCCC) calls for stabilization of greenhouse gas (GHG) concentrations at levels that prevent dangerous anthropogenic interference (DAI) in the climate system. However, some of the recent policy literature has focused on dangerous climatic change (DCC) rather than on DAI. DAI is a set of increases in GHGs concentrations that has a non-negligible possibility of provoking changes in climate that in turn have a non-negligible possibility of causing unacceptable harm, including harm to one or more of ecosystems, food production systems, and sustainable socio-economic systems, whereas DCC is a change of climate that has actually occurred or is assumed to occur and that has a non-negligible possibility of causing unacceptable harm. If the goal of climate policy is to prevent DAI, then the determination of allowable GHG concentrations requires three inputs: the probability distribution function (pdf) for climate sensitivity, the pdf for the temperature change at which significant harm occurs, and the allowed probability (“risk”) of incurring harm previously deemed to be unacceptable. If the goal of climate policy is to prevent DCC, then one must know what the correct climate sensitivity is (along with the harm pdf and risk tolerance) in order to determine allowable GHG concentrations. DAI from elevated atmospheric CO₂ also arises through its impact on ocean chemistry as the ocean absorbs CO₂. The primary chemical impact is a reduction in the degree of supersaturation of ocean water with respect to calcium carbonate, the structural building material for coral and for calcareous phytoplankton at the base of the marine food chain. Here, the probability of significant harm (in particular, impacts violating the subsidiary conditions in Article 2 of the UNFCCC) is computed as a function of the ratio of total GHG radiative forcing to the radiative forcing for a CO₂ doubling, using two alternative pdfs for climate sensitivity and three alternative pdfs for the harm temperature threshold. The allowable radiative forcing ratio depends on the probability of significant harm that is tolerated, and can be translated into allowable CO₂ concentrations given some assumption concerning the future change in total non-CO₂ GHG radiative forcing. If future non-CO₂ GHG forcing is reduced to half of the present non-CO₂ GHG forcing, then the allowable CO₂ concentration is 290–430 ppmv for a 10% risk tolerance (depending on the chosen pdfs) and 300–500 ppmv for a 25% risk tolerance (assuming a pre-industrial CO₂ concentration of 280 ppmv). For future non-CO₂ GHG forcing frozen at the present value, and for a 10% risk threshold, the allowable CO₂ concentration is 257–384 ppmv. The implications of these results are that (1) emissions of GHGs need to be reduced as quickly as possible, not in order to comply with the UNFCCC, but in order to minimize the extent and duration of non-compliance; (2) we do not have the luxury of trading off reductions in emissions of non-CO₂ GHGs against smaller reductions in CO₂ emissions, and (3) preparations should begin soon for the creation of negative CO₂ emissions through the sequestration of biomass carbon.     

China's role in attaining the global 2°C target

In the recent climate change negotiations it was declared that the increase in global temperature should be kept below 2°C by 2100, relative to pre-industrial levels. China's CO₂ emissions from energy and cement processes already account for nearly 24% of global emissions, a trend that is expected to keep increasing. Thus the role of China in global GHG mitigation is crucial. A scenario analysis of China's CO₂ emissions is presented here and the feasibility of China reaching a low-carbon scenario is discussed. The results suggest that recent and continued technological progress will make it possible for China to limit its CO₂ emissions and for these emissions to peak before 2025 and therefore that the global 2°C target can be achieved.

Policy relevance

In signing the Copenhagen Accord, China agreed to the global 2°C target. Results from this article could be used to justify low-carbon development policies and negotiations. While many still doubt the feasibility of a low-carbon pathway to support the global 2°C target, the results suggest that such a pathway can be realistically achieved. This conclusion should increase confidence and guide the policy framework further to make possible China's low-carbon development. Related policies and measures, such as renewable energy development, energy efficiency, economic structure optimization, technology innovation, low-carbon investment, and carbon capture and storage (CCS) development, should be further enhanced. Furthermore, China can play a larger role in the international negotiations process. In the global context, the 2°C target could be reaffirmed and a global regime on an emissions mitigation protocol could be framed with countries’ emissions target up to 2050.     

Dynamics of energy sector and GHG emissions in Saudi Arabia

The energy sector is the main contributor to GHG emissions in Saudi Arabia. The tremendous growth of GHG emissions poses serious challenges for the Kingdom in terms of their reduction targets, and also the mitigation of the associated climate changes. The rising trend of population and urbanization affects the energy demand, which results in a faster rate of increase in GHG emissions. The major energy sector sources that contribute to GHG emissions include the electricity generation, road transport, desalination plants, petroleum refining, petrochemical, cement, iron and steel, and fertilizer industries. In recent years, the energy sector has become the major source, accounting for more than 90% of national CO₂ emissions. Although a substantial amount of research has been conducted on renewable energy resources, a sustainable shift from petroleum resources is yet to be achieved. Public awareness, access to energy-efficient technology, and the development and implementation of a legislative framework, energy pricing policies, and renewable and alternative energy policies are not mature enough to ensure a significant reduction in GHG emissions from the energy sector. An innovative and integrated solution that best serves the Kingdom's long-term needs and exploits potential indigenous, renewable, and alternative energy resources while maintaining its sustainable development stride is essential.

Policy relevance

The main contributor to GHG emissions in Saudi Arabia is the energy sector that accounts for more than 90% of the national CO₂ emissions. Tremendous growth of GHG emissions poses serious challenges for the Kingdom in their reduction and mitigating the associated climate changes. This study examines the changing patterns of different activities associated with energy sector, the pertinent challenges, and the opportunities that promise reduction of GHG emissions while providing national energy and economic security. The importance of achieving timely, sustained, and increasing reductions in GHG emissions means that a combination of policies may be needed. This study points to the long-term importance of making near- and medium-term policy choices on a well-informed, strategic basis. This analytical paper is expected to provide useful information to the national policy makers and other decision makers. It may also contribute to the GHG emission inventories and the climate change negotiations.     

The role of technology for achieving climate policy objectives: overview of the EMF 27 study on global technology and climate policy strategies

This article presents the synthesis of results from the Stanford Energy Modeling Forum Study 27, an inter-comparison of 18 energy-economy and integrated assessment models. The study investigated the importance of individual mitigation options such as energy intensity improvements, carbon capture and storage (CCS), nuclear power, solar and wind power and bioenergy for climate mitigation. Limiting the atmospheric greenhouse gas concentration to 450 or 550 ppm CO₂ equivalent by 2100 would require a decarbonization of the global energy system in the 21^st century. Robust characteristics of the energy transformation are increased energy intensity improvements and the electrification of energy end use coupled with a fast decarbonization of the electricity sector. Non-electric energy end use is hardest to decarbonize, particularly in the transport sector. Technology is a key element of climate mitigation. Versatile technologies such as CCS and bioenergy are found to be most important, due in part to their combined ability to produce negative emissions. The importance of individual low-carbon electricity technologies is more limited due to the many alternatives in the sector. The scale of the energy transformation is larger for the 450 ppm than for the 550 ppm CO₂e target. As a result, the achievability and the costs of the 450 ppm target are more sensitive to variations in technology availability.     

Implications of weak near-term climate policies on long-term mitigation pathways

While the international community has agreed on the long-term target of limiting global warming to no more than 2 °C above pre-industrial levels, only a few concrete climate policies and measures to reduce greenhouse gas (GHG) emissions have been implemented. We use a set of three global integrated assessment models to analyze the implications of current climate policies on long-term mitigation targets. We define a weak-policy baseline scenario, which extrapolates the current policy environment by assuming that the global climate regime remains fragmented and that emission reduction efforts remain unambitious in most of the world’s regions. These scenarios clearly fall short of limiting warming to 2 °C. We investigate the cost and achievability of the stabilization of atmospheric GHG concentrations at 450 ppm CO₂e by 2100, if countries follow the weak policy pathway until 2020 or 2030 before pursuing the long-term mitigation target with global cooperative action. We find that after a deferral of ambitious action the 450 ppm CO₂e is only achievable with a radical up-scaling of efforts after target adoption. This has severe effects on transformation pathways and exacerbates the challenges of climate stabilization, in particular for a delay of cooperative action until 2030. Specifically, reaching the target with weak near-term action implies (a) faster and more aggressive transformations of energy systems in the medium term, (b) more stranded investments in fossil-based capacities, (c) higher long-term mitigation costs and carbon prices and (d) stronger transitional economic impacts, rendering the political feasibility of such pathways questionable.     

Harmonization vs. fragmentation: overview of climate policy scenarios in EMF27

This paper synthesizes results of the multi-model Energy Modeling Forum 27 (EMF27) with a focus on climate policy scenarios. The study included two harmonized long-term climate targets of 450 ppm CO₂-e (enforced in 2100) and 550 pm CO₂-e (not-to-exceed) as well as two more fragmented policies based on national and regional emissions targets. Stabilizing atmospheric GHG concentrations at 450 and 550 ppm CO₂-e requires a dramatic reduction of carbon emissions compared to baseline levels. Mitigation pathways for the 450 CO₂-e target are largely overlapping with the 550 CO₂-e pathways in the first half of the century, and the lower level is achieved through rapid reductions in atmospheric concentrations in the second half of the century aided by negative anthropogenic carbon flows. A fragmented scenario designed to extrapolate current levels of ambition into the future falls short of the emissions reductions required under the harmonized targets. In a more aggressive scenario intended to capture a break from observed levels of stringency, emissions are still somewhat higher in the second half due to unabated emissions from non-participating countries, emphasizing that a phase-out of global emissions in the long term can only be reached with full global participation. A key finding is that a large range of energy-related CO₂ emissions can be compatible with a given long-term target, depending on assumptions about carbon cycle response, non-CO₂ and land use CO₂ emissions abatement, partly explaining the spread in mitigation costs.     

The public perception of carbon dioxide capture and storage in the UK: results from focus groups and a survey

Abstract

A series of meetings of two ‘Citizen Panels’ were held to explore public perceptions of off-shore carbon dioxide (CO₂) capture and storage (CCS). In addition, a face-to-face survey of 212 randomly selected individuals was conducted. We found that, on first hearing about CCS in the absence of any information on its purpose, the majority of people either do not have an opinion at all or have a somewhat negative perspective. However, when (even limited) information is provided on the role of CO₂ storage in reducing CO₂ emissions to the atmosphere, opinion shifts towards expressing slight support for the concept.

Support depends, however, upon concern about human-caused climate change, plus recognition of the need for major reductions in CO₂ emissions. It also depends upon CCS being seen as just one part of a wider strategy for achieving significant cuts in CO₂ emissions. A portfolio including renewable energy technologies, energy efficiency, and lifestyle change to reduce demand was generally favoured. CCS can be part of such a portfolio, but wind, wave, tidal, solar and energy efficiency were preferred. It was felt that uncertainties concerning the potential risks of CCS had to be better addressed and reduced; in particular the risks of accidents and leakage (including the potential environmental, ecosystem and human health impacts which might result from leakage).     

Impacts of different diffusion scenarios for mitigation technology options and of model representations regarding renewables intermittency on evaluations of CO2 emissions reductions

This paper evaluated the impacts of climate change mitigation technology options on CO₂ emission reductions and the effects of model representations regarding renewable intermittency on the assessment of reduction by using a world energy systems model. First, different diffusion scenarios for carbon dioxide capture and storage (CCS), nuclear power, and wind power and solar PV are selected from EMF27 scenarios to analyze their impacts on CO₂ emission reductions. These technologies are important for reducing CO₂ intensity of electricity, and the impacts of their diffusion levels on mitigation costs are significant, according to the analyses. Availability of CCS in particular, among the three kinds of technologies, has a large impact on the marginal CO₂ abatement cost. In order to analyze effects of model representations regarding renewables intermittency, four different representations are assumed within the model. A simplistic model representation that does not take into consideration the intermittency of wind power and solar PV evaluates larger contributions of the energy sources than those evaluated by a model representation that takes intermittency into consideration. Appropriate consideration of renewables intermittency within global energy systems models will be important for realistic evaluations of climate change mitigation scenarios.     

Ocean acidification and climate change: synergies and challenges of addressing both under the UNFCCC

Ocean acidification and climate change are linked by their common driver: CO₂. Climate change is the consequence of a range of GHG emissions, but ocean acidification on a global scale is caused solely by increased concentrations of atmospheric CO₂. Reducing CO₂ emissions is therefore the most effective way to mitigate ocean acidification. Acting to prevent further ocean acidification by reducing CO₂ emissions will also provide simultaneous benefits by alleviating future climate change. Although it is possible that reducing CO₂ emissions to a level low enough to address ocean acidification will simultaneously address climate change, the reverse is unfortunately not necessarily true. Despite the ocean's integral role in the climate system and the potentially wide-ranging impacts on marine life and humans, the problem of ocean acidification is largely absent from most policy discussions pertaining to CO₂ emissions. The linkages between ocean acidification, climate change and the United Nations Framework Convention on Climate Change (UNFCCC) are identified and possible scenarios for developing common solutions to reduce and adapt to ocean acidification and climate change are offered. Areas where the UNFCCC is currently lacking capacity to effectively tackle rising ocean acidity are also highlighted.     

Potential impact of albedo incorporation in boreal forest sector climate change policy effectiveness

Forests have an important role to play in climate change mitigation through carbon sequestration and wood supply. However, the lower albedo of mature forests compared to bare land implies that focusing only on GHG accounting may lead to biased estimates of forestry's total climatic impacts. An economic model with a high degree of detail of the Norwegian forestry and forest industries is used to simulate GHG fluxes and albedo impacts for the next decades. Albedo is incorporated in a carbon tax/subsidy scheme in the Norwegian forest sector using a partial, spatial equilibrium model. While a price of EU€100/tCO₂e that targets GHG fluxes only results in reduced harvests, the same price including albedo leads to harvest levels that are five times higher in the first five years, with 39% of the national productive forest land base being cleared. The results suggest that policies that only consider GHG fluxes and ignore changes in albedo will not lead to an optimal use of the forest sector for climate change mitigation.

Policy relevance

Bare land reflects a larger share of incoming solar energy than dense forest and thus has higher albedo. Earlier research has suggested that changes in albedo caused by management of boreal forest may be as important as carbon fluxes for the forest's overall global warming impacts. The presented analysis is the first attempt to link albedo to national-scale forest climate policies. A policy with subsidies to forest owners that generate carbon sequestration and taxes levied on carbon emissions leads to a reduced forest harvest. However, including albedo in the policy alongside carbon fluxes yields very different results, causing initial harvest levels to increase substantially. The inclusion of albedo impacts will make harvests more beneficial for climate change mitigation as compared to a carbon-only policy. Hence, it is likely that carbon policies that ignore albedo will not lead to optimal forest management for climate change mitigation.     

Greenhouse gas emissions from global cities under SSP/RCP scenarios, 1990 to 2100

Projections of greenhouse gas (GHG) emissions are critical to enable a better understanding and anticipation of future climate change under different socio-economic conditions and mitigation strategies. The climate projections and scenarios assessed by the Intergovernmental Panel on Climate Change, following the Shared Socioeconomic Pathway (SSP)-Representative Concentration Pathway (RCP) framework, have provided a rich understanding of the constraints and opportunities for policy action. However, the current emissions scenarios lack an explicit treatment of urban emissions within the global context. Given the pace and scale of urbanization, with global urban populations expected to increase from about 4.4 billion today to about 7 billion by 2050, there is an urgent need to fill this knowledge gap. Here, we estimate the share of global GHG emissions driven by urban areas from 1990 to 2100 based on the SSP-RCP framework. The urban consumption-based GHG emissions are presented in five regional aggregates and based on a combination of the urban population share, 2015 urban per capita CO₂eq carbon footprint, SSP-based national CO₂eq emissions, and recent analysis of urban per capita CO₂eq trends. We find that urban areas account for the majority of global GHG emissions in 2015 (61.8%). Moreover, the urban share of global GHG emissions progressively increases into the future, exceeding 80% in some scenarios by the end of the century. The combined urban areas in Asia and Developing Pacific, and Developed Countries account for 65.0% to 73.3% of cumulative urban consumption-based emissions between 2020 and 2100 across the scenarios. Given these dominant roles, we describe the implications for potential urban mitigation in each of the scenario narratives in order to meet the goal of climate neutrality within this century.     

Landscape for change? International climate policy and energy transitions: evidence from sub-Saharan Africa

What is the role of the climate regime in facilitating rapid decarbonization of the world’s energy systems? We examine how core assumptions concerning the roles of the nation state, carbon markets and finance and technology in international climate policy are being challenged by the realities of how transitions in the energy systems are unfolding. Drawing on the critical region of sub-Saharan Africa, we examine the potential for international climate policy to foster new trajectories towards decarbonization.

Policy relevance

The international regime for climate policy has been in place for some twenty years. Despite significant changes in the landscape of energy systems and drivers of global GHG emissions over this time, the core principles and tools remain relatively stable – national governments, carbon markets, project-based climate finance and the transfer of technological hardware. Given the diversity of actors and drivers and the limited direct reach and influence of international climate policy, however, there is an urgent need to consider how the climate regime can best support the embryonic transitions that are slowly taking form around the world. To do this effectively requires a more nuanced understanding of the role of the state in governing these transitions beyond the notion of a cohesive state serving as rule-enforcer and transition manager. It also requires a broader view of technology, not just as hardware that is transferred, but as a set of practices and networks of expertise and enabling actors. Likewise, though markets have an important role to play as vehicles for achieving broader ends, they are not an end in themselves. Finally on finance, while acknowledging the important role of climate aid, often as a multiplier or facilitator of more ambitious private flows, it is critical to differentiate between the types of finance required for different transitions, many of which will not be counted under, or directed by, the climate regime. In sum, the (low-) carbon economy is being built in ways and in numerous sites that the climate regime needs to be cognizant of and engage with productively, and this may require fundamental reconsideration of the building blocks of the international climate regime.     

Incremental CH4 and N2O mitigation benefits consistent with the US Government's SC-CO2 estimates

Benefit–cost analysis can serve as an informative input into the policy-making process, but only to the degree it characterizes the major impacts of the regulation under consideration. Recently, the US, amongst other nations, has begun to use estimates of the social cost of CO₂ (SC-CO₂) to develop analyses that more fully capture the climate change impacts of GHG abatement. The SC-CO₂ represents the aggregate willingness to pay to avoid the damages associated with an additional tonne of CO₂ emissions. In comparison, the social costs of non-CO₂ GHGs have received little attention from researchers and policy analysts, despite their non-negligible climate impact. This article addresses this issue by developing a set of social cost estimates for two highly prevalent non-CO₂ GHGs, methane and nitrous oxide. By extending existing integrated assessment models, it is possible to develop a set of social cost estimates for these gases that are consistent with the SC-CO₂ estimates currently in use by the US federal government.Policy relevanceWithin the benefit–cost analyses that inform the design of major regulations, all Federal agencies within the US Government (USG) use a set of agreed upon SC-CO₂ estimates to value the impact of CO₂ emissions changes. However, the value of changes in non-CO₂ GHG emissions has not been included in USG policy analysis to date. This article addresses that omission by developing a set of social cost estimates for two highly prevalent non-CO₂ GHGs, methane and nitrous oxide. These new estimates are designed to be compatible with the USG SC-CO₂ estimates currently in use and may therefore be directly applied to value emissions changes for these non-CO₂ gases within the benefit–cost analyses used to evaluate future policies.     

Economics of climate policy and collective decision making

This paper explores the reasons why economic instruments of climate change are reluctantly applied and stresses the need for interdisciplinary research linking economic theory and empirical testing to deliberative political procedures. It is divided in three parts. The first one recalls the main issues in implementing Cost-Benefit Analysis such as information problems, uncertainties, discounting the future and irreversibilities. The second part shows how these issues can be treated in integrated assessment and techno-economic models and presents a case study, which shows that

• The chosen scenario tends to stabilize atmospheric CO₂ concentration at around 550 ppm in the long run.
• Exclusion of possibility to trade CO₂ emission permits under a cap regime would increase the cost of emission abatement for OECD countries.
• Combining different flexibility instruments might lead to significant gains in the overall cost of climate policy.

The third part presents results of a survey conducted among the main economic and environmental associations in Switzerland. The survey reveals conflicting views on economic instruments. It shows how the social acceptability of these instruments can be improved in taking explicitly into account these opposing views of special interest groups. Therefore, policy scenarios should be selected in combining techno-economic models with empirical studies about their political and normative context.     

Climate change mitigation scenarios and policies and measures: the case of Kazakhstan

This article illustrates the main difficulties encountered in the preparation of GHG emission projections and climate change mitigation policies and measures (P&M) for Kazakhstan. Difficulties in representing the system with an economic model have been overcome by representing the energy system with a technical-economic growth model (MARKAL-TIMES) based on the stock of existing plants, transformation processes, and end-use devices. GHG emission scenarios depend mainly on the pace of transition in Kazakhstan from a planned economy to a market economy. Three scenarios are portrayed: an incomplete transition, a fast and successful one, and even more advanced participation in global climate change mitigation, including participation in some emission trading schemes. If the transition to a market economy is completed by 2020, P&M already adopted may reduce emissions of CO₂ from combustion by about 85 MtCO₂ by 2030 – 17% of the emissions in the baseline (WOM) scenario. One-third of these reductions are likely to be obtained from the demand sectors, and two-thirds from the supply sectors. If every tonne of CO₂ not emitted is valued up to US$10 in 2020 and $20 in 2030, additional P&M may further reduce emissions by 110 MtCO₂ by 2030.     

Integrating agriculture and energy to assess GHG emissions reduction: a methodological approach

Agriculture is responsible for approximately 25% of anthropogenic global GHG emissions. This significant share highlights the fundamental importance of the agricultural sector in the global GHG emissions reduction challenge. This article develops and tests a methodology for the integration of agricultural and energy systems modelling. The goal of the research is to extend an energy systems modelling approach to agriculture in order to provide richer insights into the dynamics and interactions between the two (e.g. in competition for land-use). We build Agri-TIMES, an agricultural systems module using the TIMES energy systems modelling framework, to model the effect of livestock emissions and explore emissions reduction options. The research focuses on Ireland, which is an interesting test case for two reasons: first, agriculture currently accounts for about 30% of Ireland's GHG emissions, significantly higher than other industrialized countries yet comparable with global levels (here including emissions associated with other land-use change and forestation); second, Ireland is both a complete and reasonably sized agricultural system to act as a test case for this new approach. This article describes the methodology used, the data requirements, and technical assumptions made to facilitate the modelling. It also presents results to illustrate the approach and provide associated initial insights.

Policy relevance

Most of the policy focus with regard to climate mitigation targets has been on reducing energy-related CO₂ emissions, which is understandable as they represent by far the largest source of emissions. Non-energy-related GHG emissions – largely from agriculture, industrial processes, and waste – have received significantly less attention in policy discourse. Going forward, however, if significant cuts are made in energy-related CO₂ emissions, the role of non-energy-related GHG emissions will grow in importance. It is therefore crucial that climate mitigation analyses and strategies are not limited to the energy system. This article shows the value of using integrated energy and agriculture techno-economic modelling techniques to draw evidence for new comprehensive climate policy strategies able to discern between the full range of technical solutions available. It enables the production of economy-wide least-cost climate mitigation pathways.     

Carbon taxes,cap-and-trade administration,and US legislation

An upstream cap-and-trade system that rations allowances for the carbon content of fuel inputs could achieve wider coverage than existing CO₂ emission programmes or most of those proposed in draft US legislation, but would risk shortages and price spikes. Allowance price volatility could be avoided with a CO₂-price corridor established through auctions, similar in some respects to how central banks manage short-term interest rates with open market operations. Building on the central bank analogy, a Greenhouse Gas Board could be established with the ‘instrument independence’ to set annual CO₂-price corridors in line with broadly-framed, long-term climate goals laid out in legislation. National and regional Boards of this nature might also help facilitate the international coordination of climate policies.