Beyond ‘Dieselgate’: Implications of unaccounted and future air pollutant emissions and energy use for cars in the United Kingdom

The ‘Dieselgate’ emissions scandal has highlighted long standing concerns that the performance gap between ‘real world’ and'official’ energy use and pollutant emissions of cars is increasing to a level that renders ‘official’ certification ratings virtually ineffective while misleading consumers and damaging human health of the wider population. This paper aims to explore the scale and timing of historic and future impacts on energy use and emissions of the UK car market. To achieve this aim it applies a bespoke disaggregated model of the transport-energy-environment system to explore the impacts of retrospective and future policy scenarios on the UK car market, trade-offs between greenhouse gas and air quality emissions, and fuel use and associated tax revenues. The results suggest that the impacts on human health of ‘real world’ excess NO_X emissions in the UK are significant. Future ‘low diesel’ policies can have significant air quality benefits while showing few (if any) carbon disbenefits, suggesting future car pricing incentives may need to be rebalanced taking more account of effects of local air pollution. Car pricing incentives are however unlikely to transform the car market without additional market changes, industry push, infrastructure investment and policy pull aimed at cleaner, lower carbon vehicles.     

China's transportation energy consumption and CO2 emissions from a global perspective

Rapidly growing energy demand from China's transportation sector in the last two decades have raised concerns over national energy security, local air pollution, and carbon dioxide (CO₂) emissions, and there is broad consensus that China's transportation sector will continue to grow in the coming decades. This paper explores the future development of China's transportation sector in terms of service demands, final energy consumption, and CO₂ emissions, and their interactions with global climate policy. This study develops a detailed China transportation energy model that is nested in an integrated assessment model—Global Change Assessment Model (GCAM)—to evaluate the long-term energy consumption and CO₂ emissions of China's transportation sector from a global perspective. The analysis suggests that, without major policy intervention, future transportation energy consumption and CO₂ emissions will continue to rapidly increase and the transportation sector will remain heavily reliant on fossil fuels. Although carbon price policies may significantly reduce the sector's energy consumption and CO₂ emissions, the associated changes in service demands and modal split will be modest, particularly in the passenger transport sector. The analysis also suggests that it is more difficult to decarbonize the transportation sector than other sectors of the economy, primarily owing to its heavy reliance on petroleum products.     

Comparison of CO2 emission scenarios and mitigation opportunities in China's five sectors in 2020

This study has been created in order to better inform climate policy recommendations for China through the study of emissions reduction potential and mitigation opportunities in the major emission sectors in the country. The LEAP model along with three scenarios has been employed in this study. The study has projected that under all scenarios, China's emissions in major sectors will increase. However, through the current sustainable development strategy and even more aggressive emission reduction policies, an annual average of 201–486 million metric tons (MMT) of emissions could be reduced. The cost analysis shows that opportunities are available to achieve significant additional emission reductions at reasonable rates. Besides the results on mitigation opportunities in each sector, this research also explores sectoral preference when determining policies from different perspectives. This study concludes that China's “unilateral actions” since 2000 should be recognized and encouraged. If further emission reduction were required, sector-based mitigation policies would be a very good option and selecting proper policy-making perspective(s) and identifying the most cost-effective mitigation measures within sector and across sectors would be the key information needed to devise these policies.     

Using energy scenarios to explore alternative energy pathways in California

This paper develops and analyzes four energy scenarios for California that are both exploratory and quantitative. The business-as-usual scenario represents a pathway guided by outcomes and expectations emerging from California's energy crisis. Three alternative scenarios represent contexts where clean energy plays a greater role in California's energy system: Split Public is driven by local and individual activities; Golden State gives importance to integrated state planning; Patriotic Energy represents a national drive to increase energy independence. Future energy consumption, composition of electricity generation, energy diversity, and greenhouse gas emissions are analyzed for each scenario through 2035. Energy savings, renewable energy, and transportation activities are identified as promising opportunities for achieving alternative energy pathways in California. A combined approach that brings together individual and community activities with state and national policies leads to the largest energy savings, increases in energy diversity, and reductions in greenhouse gas emissions. Critical challenges in California's energy pathway over the next decades identified by the scenario analysis include dominance of the transportation sector, dependence on fossil fuels, emissions of greenhouse gases, accounting for electricity imports, and diversity of the electricity sector. The paper concludes with a set of policy lessons revealed from the California energy scenarios.     

The role of carbon capture technologies in greenhouse gas emissions-reduction models: A parametric study for the U.S. power sector

This paper analyzes the potential contribution of carbon capture and storage (CCS) technologies to greenhouse gas emissions reductions in the U.S. electricity sector. Focusing on capture systems for coal-fired power plants until 2030, a sensitivity analysis of key CCS parameters is performed to gain insight into the role that CCS can play in future mitigation scenarios and to explore implications of large-scale CCS deployment. By integrating important parameters for CCS technologies into a carbon-abatement model similar to the EPRI Prism analysis (EPRI, 2007), this study concludes that the start time and rate of technology diffusion are important in determining emissions reductions and fuel consumption for CCS technologies. Comparisons with legislative emissions targets illustrate that CCS alone is very unlikely to meet reduction targets for the electric-power sector, even under aggressive deployment scenarios. A portfolio of supply and demand-side strategies is needed to reach emissions objectives, especially in the near term. Furthermore, model results show that the breakdown of capture technologies does not have a significant influence on potential emissions reductions. However, the level of CCS retrofits at existing plants and the eligibility of CCS for new subcritical plants have large effects on the extent of greenhouse gas emissions reductions.     

How much carbon offsetting and where? Implications of efficiency,effectiveness, and ethicality considerations for public opinion formation

A fundamental policy design choice in government-led climate change mitigation is: what role should flexibility mechanisms like carbon offsetting play in reducing greenhouse gas (GHG) emissions. Since public opinion affects the policy choices of government, we investigate how arguments regarding carbon offsetting's economic efficiency, effectiveness, and ethicality, which have been key points in the public debate, impact the public's preferences. We fielded an online framing experiment in the United States (N=995) to empirically identify how arguments for and against carbon offsetting influence public preferences for the inclusion of offsetting in national GHG mitigation policy. We find that the public's support for international offsetting increases and support for reductions at their source (i.e. within firms' own operations) diminishes when considerations of economic efficiency gains are at the forefront. Support for offsetting declines when individuals are confronted with arguments concerning its effectiveness and ethicality, which suggests that future policies will require clear standards of additionality in order to address these concerns. Moreover, we find that how carbon offsetting is framed matters even amongst climate skeptics and support could potentially be enhanced via improved communication on efficiency gains.     

Air pollution policy in Europe: Quantifying the interaction with greenhouse gases and climate change policies

This paper uses the computable general equilibrium model WorldScan to analyse interactions between EU's air pollution and climate change policies. Covering the entire world and seven EU countries, WorldScan simulates economic growth in a neo-classical recursive dynamic framework, including emissions and abatement of greenhouse gases (CO₂, N₂O and CH₄) and air pollutants (SO₂, NO_x, NH₃ and PM_2.5). Abatement includes the possibility of using end-of-pipe control options that remove pollutants without affecting the emission-producing activity itself. This paper analyses several variants of EU's air pollution policies for the year 2020. Air pollution policy will depend on end-of-pipe controls for not more than two thirds, thus also at least one third of the required emission reduction will come from changes in the use of energy through efficiency improvements, fuel switching and other structural changes in the economy. Greenhouse gas emissions thereby decrease, which renders climate change policies less costly. Our results show that carbon prices will fall, and may even drop to zero when the EU agrees on a more stringent air pollution policy.     

Estimates of inter-fuel substitution possibilities in Chinese chemical industry

The chemical sector is a key driver of China's remarkable growth record and accounts for about 10% of the country's GDP. This has made the industry energy-intensive and consequently a major contributor to greenhouse gas emissions (GHG) and other pollutants. This study has attempted to investigate the potential for inter-fuel substitution between coal, oil, natural gas and electricity in Chinese chemical sector by employing a translog production and cost function. Ridge regression procedure was adopted to estimate the parameters of the function. Estimation results show that all energy inputs are substitutes. In addition, the study produces evidence that the significant role of coal in the Chinese chemical fuel mix converges over time, albeit slowly. These results suggest that price-based policies, coupled with capital subsidy programs can be adopted to redirect technology use towards cleaner energy sources like electricity and natural gas; hence, retaining the ability to fuel the chemical sector, while also mitigating GHG emissions. Notwithstanding, one must understand that the extent to which substituting electricity for coal will be effective depends on the extent to which coal or oil is used in generating electricity. The findings of this study provide general insights and underscore the importance of Chinese government policies that focus on installed capacity of renewable electricity, energy intensity targets as well as merger of enterprises.     

Towards cooperative policy approaches in China—Drivers for voluntary agreements on industrial energy efficiency in Nanjing

Energy efficiency is a national priority for China as rapid energy consumption growth aggravates its greenhouse gas emissions, local air pollution and energy scarcity. In the 1990s, a large number of voluntary agreements emerged in industrialised countries in order to improve industrial energy efficiency. These experiences are now taken into account in China. This article analyses the drivers for voluntary agreements on industrial energy efficiency in China, based on a case study of three enterprises in Nanjing, Jiangsu Province. Furthermore, the article reviews the institutional set-up of energy policy and investigates the pertaining policy culture. From the findings, conclusions are drawn on the role of voluntary agreements within China's larger policy context. We conclude that opposed to avoiding stricter regulation, voluntary agreements in Nanjing are reinterpreted in view of more stringent national provisions on energy efficiency in the 11th Five Year Plan. Hence, agreements have evolved into an implementation tool of national policy at the local level. For industry, another major driver for participation was identified as improving its relations with local authorities. Voluntary agreements showed to have the potential to overcome traditional constraints of implementing top–down policies at the local level in China.     

Low-carbon fuel standard—Status and analytic issues

In the United States, the federal government and several state governments are formulating or implementing policies aimed at reducing greenhouse gases emissions. In April 2009, the State of California adopted the Low-Carbon Fuel Standard (LCFS), a groundbreaking policy for reducing greenhouse gas emissions in the transportation sector. This paper reviews the major elements of a LCFS, focusing on California's implementation, and discusses the key open issues of a LCFS. This paper also summarizes the major elements of the cap-and-trade and carbon tax concepts, the two principal alternative approaches to regulating greenhouse gases emissions. Analytical issues associated with the LCFS are highlighted, including land-use change effects associated with certain biofuels. If electricity becomes a significant transportation fuel, a number of regulatory issues will need to be addressed. Beyond California, the LCFS approach appears to be favored by several other US states and the European Union. A Hydrogen-Success scenario example illustrates the key features of a national LCFS following California's model.     

Designing an emissions trading scheme for China with a dynamic computable general equilibrium model

To fulfill its Copenhagen pledges to control carbon emissions and mitigate climate change, China plans to establish a nationwide emissions trading scheme (ETS) in 2016. This paper develops a multi-sector dynamic computable general equilibrium model with an ETS module to study the appropriate ETS policy design, including a carbon cap, permit allocation and supplementary policies (e.g., penalty policies and subsidy policies). The main results are as follows. (1) To achieve China's Copenhagen pledge, the equilibrium nationwide carbon price is observed to be between 36 and 40 RMB yuan per metric ton. (2) The ETS policy has a cost-effective mitigation effect by improving China's production and energy structures with relatively little economic harm. (3) Various ETS sub-policies should be carefully designed to balance economic growth and carbon mitigation. In particular, the carbon cap should be set according to China's Copenhagen pledge. A relatively large distribution ratio of free permits, the output-based grandfathering rule for free permits, a penalty price (on illegitimate emissions) slightly above the carbon price, and a sufficient subsidy (from ETS revenue) are strongly recommended in the early stages to avoid significant economic loss. These designs can be adjusted in later stages to enhance the mitigation effect.     

Can CDM bring technology transfer to China?—An empirical study of technology transfer in China’s CDM projects

China has undertaken the greatest number of projects and reported the largest emission reductions on the global clean development mechanism (CDM) market. As technology transfer (TT) was designed to play a key role for Annex II countries in achieving greenhouse gas emission reductions, this study examines various factors that have affected CDM and TT in China. The proportion of total income derived from the certified emissions reductions (CER) plays a key role in the project owners’ decision to adopt foreign technology. Incompatibility of CDM procedures with Chinese domestic procedures, technology diffusion (TD) effects, Chinese government policy and the role of carbon traders and CDM project consultants all contribute to the different degrees and forms of TT. International carbon traders and CDM consultants could play a larger role in TT in China's CDM projects as investors and brokers in the future.     

Optimal technological choices in meeting Australian energy policy goals

Australia's energy system faces a number of environmental challenges and chief among them is reducing greenhouse gas emissions. In the electricity sector, the Australian government has began implementing policies, which require greater use of gas and renewables based technologies. In this study, we simulate the optimal shares of several electricity generation technologies for Australia under a policy of greenhouse gas mitigation. In doing so, we seek to determine the likely technological investment paths over the next two decades and consider the sensitivity of those projections to assumptions regarding technological change, resource scarcity and economies or diseconomies of scale.     

The role of decentralized generation and storage technologies in future energy systems planning for a rural agglomeration in Switzerland

This study presents a framework to quantitatively evaluate decentralized generation and storage technology (DGST) performance and policy impacts in a rural setting. The role of DGSTs in the future energy systems planning of a rural agglomeration in Switzerland is examined using a cost optimization modeling approach. Heat and electricity demand for major sectors are considered. Scenarios introduce DGSTs in a stepwise manner to measure incremental impacts on future capacity planning compared to a baseline scenario. Sub-scenarios also examine the impacts of carbon mitigation policies, and a sensitivity analysis is carried out for key energy carriers and conversion technologies. DGSTs enable a significant reduction in electricity grid usage for the community considered. Small hydro with a storage reservoir and photovoltaics enable the community to become largely self-sufficient with over 80% reductions in grid imports by 2050 compared to the baseline scenario. Storage enables maximum usage of the available hydro potential which also leads to network upgrade deferrals and a significant increase in photovoltaic installations. Investment decisions in small hydro are robust against cost variations, while heating technology investment decisions are sensitive to oil and grid electricity prices. Carbon pricing policies are found to be effective in mitigating local fossil fuel emissions.     

Assessment of demand for natural gas from the electricity sector in India

Electricity sector is among the key users of natural gas. The sustained electricity deficit and environment policies have added to an already rising demand for gas. This paper tries to understand gas demand in future from electricity sector. This paper models the future demand for gas in India from the electricity sector under alternative scenarios for the period 2005–2025, using bottom-up ANSWER MARKAL model. The scenarios are differentiated by alternate economic growth projections and policies related to coal reforms, infrastructure choices and local environment. The results across scenarios show that gas competes with coal as a base-load option if price difference is below US $ 4 per MBtu. At higher price difference gas penetrates only the peak power market. Gas demand is lower in the high economic growth scenario, since electricity sector is more flexible in substitution of primary energy. Gas demand reduces also in cases when coal supply curve shifts rightwards such as under coal reforms and coal-by-wire scenarios. Local environmental (SO₂ emissions) control promotes end of pipe solutions flue gas de-sulfurisation (FGD) initially, though in the longer term mitigation happens by fuel substitution (coal by gas) and introduction of clean coal technologies integrated gasification combined cycle (IGCC).     

Challenges for CO2 mitigation in the Lebanese electric-power sector

Similar to other developing countries the electricity sector in Lebanon is monopolized by a vertically integrated public utility, Electricite Du Liban (EDL). EDL's supply is characterized by frequent and lengthy power cuts that have given rise to an alternative, informal, and unregulated backup sector, which serves to satisfy electricity demand during the extended blackout periods. This paper examines the evolvement of the backup sector and its related CO₂ emissions via the use of scenario analysis. The economic and energy policy implications of each scenario are discussed and a number of policy options are presented to ensure that the growth in CO₂ emissions is contained. Results clearly indicate that the backup sector plays a critical role in the success of any greenhouse gas mitigation commitment undertaken by Lebanon. A clear strategy on dealing with this sector needs to be devised simultaneously if not prior to any climate change policy at the national level.     

Assessment of China's climate commitment and non-fossil energy plan towards 2020 using hybrid AIM/CGE model

China made a commitment in Copenhagen to reduce its carbon dioxide emissions per unit of GDP from 40% to 45% compared with the 2005 level by 2020, and is determined to vigorously develop non-fossil fuels. This study analyzes the effects and impacts of policies that could help to achieve China's Copenhagen commitments with a hybrid static CGE model in which the electricity sector is disaggregated into 12 generation technologies. Four scenarios are developed, including the reference scenario A, the reference scenario B and two carbon constraint scenarios. The results show that carbon intensity in terms of GDP will fall by 30.97% between 2005 and 2020 in the reference scenario A, and will be reduced further by 7.97% if China's targeted non-fossil energy development plans can be achieved in the reference scenario B. However, the rest of the 40–45% target must be realized by other measures such as carbon constraint. It is also observed that due to carbon intensity constraints, GDP loss would be from 0.032% to 0.24% compared to the reference scenario B, and CO₂ emission reductions are due mainly to decreases in coal consumption in the electricity sector and manufacturing sector.     

Interactions and implications of renewable and climate change policy on UK energy scenarios

As a response to the twin challenges of climate change mitigation and energy security, the UK government has set a groundbreaking target of reducing the UK’s economy-wide carbon emissions by 80% from 1990 levels by 2050. A second key UK energy policy is to increase the share of final energy consumption from renewables sources to 15% by 2020, as part of the wider EU Renewable Directive. The UK’s principle mechanisms to meet this renewable target are the Renewable Obligation (RO) in the electricity sector, the Renewable Transport Fuel Obligation (RTFO), and most recently the Renewable Heat Programme (RHP) for buildings. This study quantifies a range of policies, energy pathways, and sectoral trade-offs when combining mid- and long-term UK renewables and CO₂ reduction policies. Stringent renewable policies are the binding constraints through 2020. Furthermore, the interactions between RO, RTFO, and RHP policies drive trade-offs between low carbon electricity, bio-fuels, high efficiency natural gas, and demand reductions as well as resulting 2020 welfare costs. In the longer term, CO₂ reduction constraints drive the costs and characteristics of the UK energy system through 2050.     

Analyzing carbon pricing policies using a general equilibrium model with production parameters estimated using firm data

Policy simulation results of Computable General Equilibrium (CGE) models largely hinge on the choices of substitution elasticities among key input factors. Currently, most CGE models rely on the common elasticities estimated from aggregated data, such as the GTAP model elasticity parameters. Using firm level data, we apply the control function method to estimate CES production functions with capital, labor and energy inputs and find significant heterogeneity in substitution elasticities across different industries. Our capital-labor substitution elasticities are much lower than the GTAP values while our energy elasticities are higher. We then incorporate these estimated elasticities into a CGE model to simulate China's carbon pricing policies and compare with the results using GTAP parameters. Our less elastic K-L substitution leads to lower base case GDP growth, but our more elastic energy substitution lead to lower coal use and carbon emissions. In the carbon tax policy exercises, we find that our elasticities lead to easier reductions in coal use and carbon emissions.     

Development forecast of renewable energy power generation in China and its influence on the GHG control strategy of the country

CO₂ emissions of the electricity supply sector in China account for about half of the total volume in the country. Thus, reducing CO₂ emissions in China’s electricity supply sector will contribute significantly to the efforts of greenhouse gas (GHG) control in the country and the rest of the world. This paper introduces the development status of renewable energy and other main CO₂ mitigation options in power generation in China and makes a preliminary prediction of the development of renewable energy in the country for future decades. Besides, based on the situation in China, the paper undertakes a comprehensive analysis of CO₂ mitigation costs, mitigation potential, and fossil energy conversation capacity of renewable energy and other mitigation options, through which the influence of renewable energy on the mitigation strategy of China is analyzed.