Implications of Japan’s long term climate mitigation target and the relevance of uncertain nuclear policy

Achieving long-term climate mitigation goals in Japan faces several challenges, starting with the uncertain nuclear power policy after the 2011 earthquake, the uncertain availability and progress of energy technologies, as well as energy security concerns in light of a high dependency on fuel imports. The combined weight of these challenges needs to be clarified in terms of the energy system and macroeconomic impacts. We applied a general equilibrium energy economic model to assess these impacts on an 80% emission reduction target by 2050 considering several alternative scenarios for nuclear power deployment, technology availability, end use energy efficiency, and the price of fossil fuels. We found that achieving the mitigation target was feasible for all scenarios, with considerable reductions in total energy consumption (39%–50%), higher shares of low-carbon sources (43%–72% compared to 15%), and larger shares of electricity in the final energy supply (51%–58% compared to 42%). The economic impacts of limiting nuclear power by 2050 (3.5% GDP loss) were small compared to the lack of carbon capture and storage (CCS) (6.4% GDP loss). Mitigation scenarios led to an improvement in energy security indicators (trade dependency and diversity of primary energy sources) even in the absence of nuclear power. Moreover, preliminary analysis indicates that expanding the range of renewable energy resources can lower the macroeconomic impacts of the long term target considerably, and thus further in depth analysis is needed on this aspect.

Key policy insights

• For Japan, an emissions reduction target of 80% by 2050 is feasible without nuclear power or CCS.

• The macroeconomic impact of such a 2050 target was largest without CCS, and smallest without nuclear power.

• Energy security indicators improved in mitigation scenarios compared to the baseline.

     

区域煤炭资源流动及其宏观经济效应初探——以内蒙古为例

从流量、流向以及流动通道三方面,探讨了内蒙古煤炭资源流动平衡现状,采用向量自回归模型解析了内蒙古煤炭资源流动与其宏观经济发展的相互作用关系,结果表明:(1)内蒙古已成长为中国最大的能源输出基地,煤炭交流活动主要集中在其周边地区,尤以华北和东北地区为主。(2)内蒙古铁路煤炭运能不足,缺乏独立、完善的运输网络。(3)内蒙古煤炭资源流动与区内经济发展水平的提高、重工业的发展、第三产业发展以及税收增长均存在着长期稳定的均衡关系,且对区内重工业发展和税收增长具有明显的单向推动作用,但对区内人均GDP和第三产业发展的促进作用相对比较微弱。(4)建立独立、完善的煤炭运输网络;重视发展煤炭运输及其相关服务业;转变能源输出战略,提高输出资源附加值,带动区内煤炭工业以及整体经济发展水平提高的政策建议。     

Distribution of emissions allowances as an opportunity

Much of the debate on climate policy in the USA focuses on the gain or loss to the macroeconomy of alternative policies to reduce greenhouse gas emissions. However, the economy is made up of multiple individuals, not a single representative agent. This article reports the results of alternative ways of distributing emissions allocations across citizens. Macroeconomic effects interact with the policy for distribution, but the distributional weights are more important for the welfare of individual agents than the economy-wide effects of the emissions reductions. Egalitarian distributions of the emissions allowances have the potential to increase the welfare of most people, even if significant emissions reductions are mandated. Focusing on the distribution of emissions allowances (or the revenues generated from an emissions tax) rather than on aggregate GDP may provide guidance in identifying and implementing politically viable solutions to the climate change mitigation problem.     

Assessment of Global Seismic Loss Based on Macroeconomic Indicators

Most earthquake loss studies use a probabilistic approach in which predicted damages in various categories of structure and facilities in the region in concern are estimated and added together to obtain a total loss for particular intensity ranges. Such an approach requires a detailed inventory database of the structures and facilities in the region, which is not always readily available in many regions of the world. We have used an alternative means of estimating earthquake losses based on several macroeconomic indices such as the gross domestic product and population. Using published earthquake loss data for 1980–1995, the relations between GDP and earthquake loss have been formulated empirically for several intensity ranges. The world's land surface was divided into unit cells 0.5° lat. × 0.5° long. in size. The GDP of each cell was apportioned based on its population and GDP, and the population of the region to which it belongs. The predicted seismic loss of the cell was then estimated from the seismic hazard probability function, its GDP, and the empirical relation between GDP and seismic loss. A global seismic loss map is then compiled both for the intensity at 10% probability of exceedance and the probable maximum intensity. Employing readily available socioeconomic data as the basis for the vulnerability analysis, the method enables us to obtain seismic loss estimates for regions without the need for a detailed inventory of exposed structures or collateral geological information. Since such statistics are frequently compiled by the world's leading political and financial institutions, the seismic loss estimates can also be upgraded easily for the fast developing areas of the world.     

Global socio-economic and climate change mitigation scenarios through the lens of structural change

This paper analyses structural change in the economy as a key but largely unexplored aspect of global socio-economic and climate change mitigation scenarios. Structural change can actually drive energy and land use as much as economic growth and influence mitigation opportunities and barriers. Conversely, stringent climate policy is bound to induce specific structural and socio-economic transformations that are still insufficiently understood. We introduce Multi-Sectoral macroeconomic Integrated Assessment Models as tools to capture the key drivers of structural change and we conduct a multi-model study to assess main structural effects – changes of the sectoral composition and intensity of trade of global and regional economies – in a baseline and 2°C policy scenario by 2050. First, the range of baseline projections across models, for which we identify the main drivers, illustrates the uncertainty on future economic pathways – in emerging economies especially – and inform on plausible alternative futures with implications for energy use and emissions. Second, in all models, climate policy in the 2°C scenario imposes only a second-order impact on the economic structure at the macro-sectoral level – agriculture, manufacturing and services - compared to changes modelled in the baseline. However, this hides more radical changes for individual industries – within the energy sector especially. The study, which adopts a top-down framing of global structural change, represents a starting point to kick-start a conversation and propose a new research agenda seeking to improve understanding of the structural change effects in socio-economic and mitigation scenarios, and better inform policy assessments.     

山东省城市建设用地与宏观经济的关联度分析

该文采取灰色系统的灰色关联度分析了山东省2001—2008年城市建设用地与固定资产、GDP和城市化率的关联程度,得出城市建设用地与GDP最相关,二者的关联度达到0.92,其次是城市化率,二者的关联度为0.88,在3个指标中,与固定资产投资的关联程度最低,二者的关联度为0.70。说明经济发展是城市建设用地扩张的主要驱动力。     

Macroeconomic analysis of the employment impacts of future EU climate policies

This article gives a detailed account of part of the modelling that was carried out for the assessment of the EU's proposed energy and climate targets for 2030. Using the macro-econometric simulation model, E3ME, and drawing on results from the PRIMES energy systems model, it shows that a 40% reduction in GHG emissions (compared to 1990 levels) could lead to an increase in employment of up to 0.7 million jobs in Europe. Furthermore, if the same GHG reduction target was combined with targets for renewables and energy efficiency, the net increase in jobs could be as high as 1.2 million. Both results are in contrast to the standard findings from computable general equilibrium (CGE) models, reflecting the different underlying assumptions (e.g. labour supply) to the modelling approach. Additional sensitivity testing shows that the ways in which the energy efficiency and renewable measures are funded are important factors in determining overall economic impact.

Policy relevance

In recent years there has been much debate as to whether the European Union should have a single GHG reduction target or a set of targets that also cover renewables and energy efficiency. This paper elaborates on part of the modelling that was carried out for the official assessment of the European Union's proposed energy and climate targets for 2030. Using an empirical, model-based approach, it compares a scenario where there is a single 40% GHG reduction target to a scenario that also includes a 30% renewables target and stricter energy efficiency standards. The model results show that the large investment stimulus needed to meet the combined targets leads to higher levels of GDP and employment. This suggests that there could be medium-term economic and social benefits to including all three targets in the future energy and climate package.     

Macroeconomic impacts of the Florida Energy and Climate Change Action Plan

The impacts of the Florida Energy and Climate Change Action Plan on the state's economy are analysed. The plan contains 50 policy recommendations developed through a stakeholder-driven, consensus-based process. The analysis carefully links each greenhouse gas mitigation/sequestration option to the workings of the Florida economy with the use of the Regional Economic Models, Inc. (REMI) Policy Insight model. The results indicate that most of the recommended options individually have positive impacts on the state's economy. When combined, the plan's recommendations would, on a net present value basis, increase the gross state product (GSP) by about $37.9 billion and increase employment by 148,000 full-time equivalent jobs by 2025. The Florida Renewable Portfolio Standard contributes the highest GSP gains, or nearly 50% of the total. The economic gains arise primarily from the ability of mitigation options to both lower the cost of production and increase consumer purchasing power. The results also stem from the stimulus of increased investment in plant and equipment. Sensitivity analyses of key assumptions and parameters indicate that the results are robust.     

The role of money and the financial sector in energy-economy models used for assessing climate and energy policy

This article outlines a critical gap in the assessment methodology used to estimate the macroeconomic costs and benefits of climate and energy policy, which could lead to misleading information being used for policy-making. We show that the Computable General Equilibrium (CGE) models that are typically used for assessing climate policy use assumptions about the financial system that sit at odds with the observed reality. These assumptions lead to ‘crowding out’ of capital and, because of the way the models are constructed, negative economic impacts (in terms of gross domestic product (GDP) and welfare) from climate policy in virtually all cases.

In contrast, macro-econometric models, which follow non-equilibrium economic theory and adopt a more empirical approach, apply a treatment of the financial system that is more consistent with reality. Although these models also have major limitations, they show that green investment need not crowd out investment in other parts of the economy – and may therefore offer an economic stimulus. Our conclusion is that improvements in both modelling approaches should be sought with some urgency – both to provide a better assessment of potential climate and energy policy and to improve understanding of the dynamics of the global financial system more generally.

POLICY RELEVANCE

This article discusses the treatment of the financial system in the macroeconomic models that are used in assessments of climate and energy policy. It shows major limitations in approach that could result in misleading information being provided to policy-makers.     

基于宏观经济的区域水资源多目标集成系统

将区域水资源规划纳入宏观经济范畴,阐述了基于宏观经济的区域水资源系统的概念,并以此为基础,建立了区域水资源规划多目标集成系统。该系统以宏观经济子模型及其它子模型为基础,并在多目标分析模型中集系统要素为一体,形成系统的总控模型。该系统还集预测、模拟、优化及决策分析等功能为一体,以建立一个完善的区域水资源规划分析系统。