Achieving a low-carbon society

Climate change is perhaps the central challenge that faces humanity. If the concept of green growth is to be anything more than a mere rebranding of the concept of sustainability, then it must elucidate the relationship between economic activity and pollution and provide a more detailed economic account of it. The articles in this Special Issue focus on ways in which GHG emissions may be reduced while satisfying the increasing demand for energy: from global, technological or economic solutions, to sub-national, financial or regulatory ones. Although the wide disparity in income between the least and most wealthy makes it difficult to reach a consensus on the best way to achieve a low-carbon society, the scale and potential effects of climate change make it imperative that one is reached.     

Korea’s approach to overcoming difficulties in adopting the emission trading scheme

In this study, we aim to describe the background for design characteristics of emissions trading schemes (ETS) in developing and emerging economies, with a particular focus on the case of Korea. These countries may face unique hardships such as fierce opposition from industry sectors, the presence of a power imbalance between the Ministry of Environment (MOE) and ministries that are in charge of supporting output growth, and the absence or incomplete development of financial markets and auctioning mechanisms. To overcome these hardships, the Korean government legislated laws that defined timelines for every stage of ETS development, established a strategic governance architecture to make up the weak position of the MOE, offered strong market-stabilizing measures focused on maintaining the allowance price below a certain level, and provided support packages to make the low-carbon transition easy by compensating for losses caused by the Korea Emissions Trading Scheme (KETS). Such policy instruments that made adoption of KETS easier could be obstacles to making it efficient.

Policy relevance

In the process of adopting a cap-and-trade system, both a developing economy and an emerging economy may face unique hardships, such as strong opposition from industry sectors, the presence of a power imbalance between the Ministry of Environment (MOE) and ministries that are in charge of supporting output growth, and the absence or incomplete development of financial markets and auctioning mechanisms. To make up for the weak base of Korea’s ETS, the government legislated laws that defined timelines for every stage of the ETS development, established a strategic governance architecture to make up for the weak position of the MOE, offered strong market-stabilizing measures focused on maintaining the allowance price below a certain level, and provided support packages to make the low-carbon transition easy by compensating for losses caused by the Korea’s ETS. Korea’s experiences can be shared with other developing economies that are considering adoption of a cap-and-trade scheme.     

The design of California's cap-and-trade and its impact on electricity markets

California is considering the adoption of a cap-and-trade regulatory mechanism for regulating the greenhouse gas emissions from electricity and perhaps other industries. Two options have been widely discussed for implementing cap-and-trade in the electricity industry. The first is to regulate the emissions from electricity at the load-serving entity (LSE) level. The second option for implementation of cap-and-trade has been called the ‘first-seller’ approach. Conceptually, under first-seller, individual sources (i.e. power plants) within California would be responsible for their emissions, as with traditional cap-and-trade systems. Emissions from imports would be assigned to the ‘importing firm’. An option that has not been as widely discussed is to implement a pure source-based system within California, effectively excluding imports from the cap-and-trade system altogether. This article examines these three approaches to implementing cap-and-trade for California's electricity sector. The article discusses many of the issues relating to measurement and the impacts on bidding and scheduling incentives that are created by the various regulatory regimes.     

Commitments through financial options: an alternative for delivering climate change obligations

Governments willing to commit themselves to maintain carbon prices at or above a certain level face the challenge that their commitments need to be credible both for investors in low-carbon technology and for foreign governments. This article argues that governments can make such commitments by issuing long-term put option contracts on the price of CO₂ allowances. This mechanism gives investors the right, but not the obligation, to sell allowances to the government at the strike price. From the investors' point of view, a government is therefore fully committed to a price floor for allowances in the future. This proposed approach alters the incentives that a government faces when considering noncompliance and serves to prevent non-compliance. The proposal fares well when assessed against criteria to determine its suitability in legitimacy, enforcement, proportionality, lack of interference from other contracting States, and transparency. It also allows for fine-tuning through the number and duration of issued options and the strike price. A robust contract structure is proposed to protect against government interference that might threaten the credibility of commitments.     

Sectoral targets for developing countries: combining ‘common but differentiated re-sponsibilities’ with ‘meaningful participation’

Although a global cap-and-trade system is seen by many researchers as the most cost-efficient solution to reduce greenhouse gas (GHG) emissions, the governments of developing countries refuse to enter into such a system in the short term. Many scholars and stakeholders, including the European Commission, have thus proposed various types of commitments for developing countries that appear less stringent, such as sectoral approaches. A macroeconomic assessment of such a sectoral approach is provided for developing countries. Two policy scenarios in particular are assessed, in which developed countries continue with Kyoto-type absolute commitments, while developing countries adopt an emissions trading system limited to electricity generation and linked to developed countries' cap-and-trade systems. In the first scenario, CO₂ allowances are auctioned by the government, which distributes its revenues as a lump sum to households. In a second scenario, the auction revenues are used to reduce taxes on, or to give subsidies to, electricity generation. The quantitative analysis, conducted with a hybrid general equilibrium model, shows that such options provide almost as much emissions reduction as a global cap-and-trade system. Moreover, in the second sectoral scenario, GDP losses in developing countries are much lower than with a global cap-and-trade system, as is also the effect on the electricity price.     

The impact of the unilateral EU commitment on the stability of international climate agreements

The negotiation strategy of the European Union was analysed with respect to the formation of an international climate agreement for the post-2012 era. Game theory was employed to explore the incentives for key players in the climate policy arena to join future climate agreements. A ?20% unilateral commitment strategy by the EU was compared with a multilateral ?30% emission reduction strategy for all Annex-B countries. Using a numerical integrated assessment climate—economy simulation model, we found that leakage, in the sense of strategic policy reactions on emissions, was negligible. The EU strategy to reduce emissions by 30% (compared with 1990 levels) by 2020, if other Annex-B countries follow suit, does not induce the participation of the USA with a comparable reduction commitment. However, we argue that the original EU proposal can be reshaped so as to stabilize a larger and more ambitious climate coalition than the Kyoto Protocol in its first commitment period.     

Solubility of Anhydrite, CaSO4, in NaCl-H2O Solutions at High Pressures and Temperatures: Applications to Fluid-Rock Interaction

Anhydrite solubility in H₂O–NaCl solutions was measuredat 6–14 kbar, 600–800°C and NaCl mole fractions(X_NaCl) of 0–0·3 in piston–cylinder apparatus.Solubilities were determined by weight changes of natural anhydritein perforated Pt envelopes confined with fluid in larger Ptcapsules. In initially pure H₂O at 10 kbar and 800°C, CaSO₄concentration is low (0·03 molal), though much largerthan at the same temperature and 1 kbar. Hematite-buffered experimentsshowed slightly lower solubilities than unbuffered runs. CaSO₄solubility increases enormously with NaCl activity: at 800°Cand 10 kbar and X_NaCl of 0·3, CaSO₄ molality is 200 timeshigher than with pure H₂O. Whereas CaSO₄ solubility in pureH₂O decreases with rising T at low T and P, the high-P resultsshow that anhydrite solubility increases with T at constantP at all X_NaCl investigated. The effects of salinity and temperatureare so great at 10 kbar that critical mixing between sulfate-richhydrosaline melts and aqueous salt solutions is probable at900°C at X_NaCl 0·3. Recent experimental evidencethat volatile-laden magmas crystallizing in the deep crust mayevolve concentrated salt solutions could, in light of the presentwork, have important implications regarding such diverse processesas Mount Pinatubo-type S-rich volcanism, high-f O₂ regionalmetamorphism, and emplacement of porphyry Cu–Mo ore bodies,where anhydrite–hematite alteration and fluid inclusionsreveal the action of very oxidized saline solutions rich insulfur. KEY WORDS: anhydrite; sulfur; solubility; metamorphic brines; granulites     

On the Retrieval of Volcanic Sulfur Dioxide Emissions from GOME Backscatter Measurements

We focus on the retrieval of volcanic sulfur dioxide (SO₂) emissions from an analysis of atmospheric UV backscatter spectra obtained by the Global Ozone Monitoring Experiment (GOME) spectrometer on board the ESA European Remote Sensing Satellite (ERS-2). Here, the last major eruptions of Mt. Etna on Sicily (Italy) in July/August 2001 and October/November 2002 provided an excellent opportunity to study the retrieval of SO₂ columnar amounts from ground-based, LIDAR and satellite measurements. Our study shows that the bulk of emitted SO₂ was confined in the troposphere, mainly between 700 hPa and 400 hPa which is confirmed by trajectory analysis, by LIDAR observations and AVHRR observations. The area of influence of Mt. Etna eruptions ranges from the Western Saharan Desert to Greece and the near east states and even down to the basin of Tschad, Africa. Our analysis revealed that information about the plume height of volcanic eruptions and aerosol parameters is necessary for a reliable quantitative retrieval of SO₂ from space-borne sensor data at periods perturbed by volcanic eruptions.     

Isotopic evidence of TSR origin for natural gas bearing high H<Subscript>2</Subscript>S contents within the Feixianguan Formation of the northeastern Sichuan Basin,southwestern China

The northeastern area of Sichuan Basin, southwestern China, is the area with the maximal reserve of natural gas containing higher hydrogen sulphide (H₂S) that has been found among the petroliferous basins of China, with the proven and controlled gas reserve of more than 200 billion cubic meters. These gas pools, with higher H₂S contents averaging 9%, some 17%, are mainly distributed on structural belts of Dukouhe, Tieshanpo, Luojiazhai, Puguang, etc., while the oolitic-shoal dolomite of the Triassic Feixianguan Fm. (T₁f) is the reservoir. Although many scholars regard the plentiful accumulation of H₂S within the deep carbonate reservoir as the result of Thermochemical Sulfate Reduction (TSR), however, the process of TSR as well as its residual geological and geochemical evidence is still not quite clear. Based on the carbon isotopic analysis of carbonate strata and secondary calcite, etc., together with the analysis of sulfur isotopes within H₂S, sulphur, gypsum, iron pyrites, etc., as well as other aspects including the natural gas composition, carbon isotopes of hydrocarbons reservoir petrology, etc., it has been proved that the above natural gas is a product of TSR. The H₂S, sulphur and calcite result from the participation of TSR reactions by hydrocarbon gas. During the process for hydrocarbons being consumed due to TSR, the carbons within the hydrocarbon gas participate in the reactions and finally are transferred into the secondary calcite, and become the carbon source of secondary calcite, consequently causing the carbon isotopes of the secondary calcite to be lower (−18.2‰). As for both the intermediate product of TSR, i.e. sulfur, and its final products, i.e. H₂S and iron pyrites, their sulfur elements are all sourced from the sulfate within the Feixianguan Fm. During the fractional processes of sulfur isotopes, the bond energy leads to the ³²S being released firstly, and the earlier it is released, the lower δ ³⁴S values for the generated sulphide (H₂S) or sulfur will be. However, for the anhydrite that participates in reactions, the higher the reaction degree, the more ³²S is released, while the less ³²S remains and the more δ ³⁴S is increased. The testing results have proved the process of the dynamic fractionation of sulfur isotopes.