The challenge of stabilisation

1. The challenge of stabilisation Stern Review, Chapter 8

2. Content • What is stabilisation? • Why stabilise? • Optimal stabilisation level • Stabilising CO2 concentrations • Stabilising non- CO2 concentrations • Pathways to stabilisation • Analysing stabilisation strategies • The challenge of stabilisation

3. What is stabilisation (of GHG concentration)? „Stabilisation requires that annual emissions be brought down to a level that balances the earth‘s natural capacity to remove greenhouse gases from the atmosphere.“

4. Why stabilise? • Relation between greenhouse gases and global temperature: The warming effect of GHGs rises logarithmically with their concentration in the atmosphere • Global mean temperature will continue to rise unless the stock of GHGs is stabilised

5. Optimal stabilisation level • Probability of an ultimate global mean temperature rise above 3°C • 450 ppm CO2e: 5- 20% • 550 ppm CO2e: 30- 70% • 650 ppm CO2e: 60- 95%

6. Optimal stabilisation level • A stabilisation level between 450 ppm CO2e and 550 ppm CO2e seems optimal • Stabilisation below 450 ppm CO2e would require extensive and rapid emission cuts which incur high costs • Stabilisation above 550 ppm CO2e would imply substantial climatic risks

7. Content • What is stabilisation? • Why stabilise? • Optimal stabilisation level • Stabilising CO2 concentrations • Stabilising non- CO2 concentrations • Pathways to stabilisation • Analysing stabilisation staregies • The challenge of stabilisation

8. Stabilising CO2 concentrations • CO2 concentration has risen by about 1/3 since pre- industrial times (from 280ppm to 380ppm) • Account for 70% of the global warming effect • Earth‘s soils, vegetation and oceans have absorbed around 60% of the CO2 emissions from the past two centuries, leaving 800 GtCO2 (of 2000 GtCO2 emitted) in the atmosphere

9. Stabilising CO2 concentrations • Feedbacks between the climate and the carbon cycle • Natural carbon absorption will weaken as the world warms • More emissions have to be reduced as previously thought

10. Stabilising CO2 concentrations

11. Stabilising non- CO2 concentration • Account for around 30% of the total warming effect • Make up ¼ of the total emissions in terms of their global warming potential (GWP) • GWP provides a way to compare the greenhouse gases • GWP of CO2 is 1

12. Stabilising non- CO2 concentration Many non- CO2 gases have a higher GWP and a longer lifetime than CO2, therefore abating their emissions is very important in the long run!

13. Content • What is stabilisation? • Why stabilise? • Optimal stabilisation level • Stabilising CO2 concentrations • Stabilising non- CO2 concentrations • Pathways to stabilisation • Analysing stabilisation staregies • The challenge of stabilisation

14. Pathways to stabilisation

15. Pathways to stabilisation • The rate of emission cuts requiered to meet a stabilisation goal depends on the timing and height of the peak. • If emissions peak at 48 GtCO2e rather than at 52 GtCO2e in 2020, the rate of cuts is reduced from 2,5% per year to 1,5% per year • A high peak in 2020 rather than in 2030 can reduce the rate of emission cuts from 4,0% per year to 2,5% per year • Because of the weakening of natural carbon absorption late abatement might incur higher emission reduction rates • Delaying abatement escalate the risk of getting locked into long-lived high carbon technologies

16. Stabilisation at 550 ppm • For a peak in 2015 annual reduction needs to be around 1% • Such an early peak looks quite difficult • For a delay of 15 years the reduction rate will be between 2,5%/yr and 4%/yr

17. Stabilisation at 450 ppmwithout overshooting • Overshooting: The peak reaches a level above the target level. Overshooting implies risks like more rapid increase in global temperature and therefore an acceleration of feedback processes. • To stabilise at 450 ppm (about 20 ppm above today‘s level) emissions have to peak in 2010 and have to fall then by 7% per year • This means in 2050 annual emissions have to be 50% below the current level

18. Stabilisation at 450 ppmwithout overshooting • A 10 year delay wouldn‘t even allow a stabilisation at 450 ppm • Stabilisation at 450 ppm is very costly and seems unrealistic (countries like China aren‘t willing to reduce their emissions)

19. Stabilisation at 450 ppmwith overshooting • If the stock peaks at 500 ppm before stabilising at 450 ppm the required annual reduction rate will decrease from 7% to 3% (if emissions peak in 2010) • Overshooting might be the only way to reach 450 ppm- although it contains a large number of unknowns in the climate system (threshold points, irreversible changes)

20. Historical reductions in national emissions • It‘s difficult to cut emissions faster than about 1% per year • France: switching to nuclear power- based energy- 0,6% energy-related emission reduction per year between 1977 and 2003 • Brazil: enforcing biofuel from 1% in 1975 to 25% in 2002- slow its road transport emissions (rose by 2,8% per year with biofuels and would have risen at around 3,6% per year without biofuels)

21. Historical reductions in national emissions • The UK: reduced ist emission on an average of 1% per year between 1990 and 2000 because of an increase in coal price • Acoording to this data a emission reduction rate of 7% per year (which would be needed for stabilising at 450 ppm) seems very unrealistic

22. Difficulties in sustaining a rapid rate of emission cuts • The capital stock lasts a number of years locking the economy into a particular emission pathway • Developing new lower emission technology is a slow process • It takes time to change habits, preferences and institutional structures in favour of low- carbon alternatives

23. Content • What is stabilisation? • Why stabilise? • Optimal stabilisation level • Stabilising CO2 concentrations • Stabilising non- CO2 concentrations • Pathways to stabilisation • Analysing stabilisation staregies • The challenge of stabilisation

24. The challenge of stabilisation • To stabilise at 550 ppm emissions have to peak in the next 10 to 20 years and have to decline at a substantial level • Global emissions are rapidly rising and under business as usual (BAU) the emissions will rise even more • The difference between these pathways is called the mitigation gap

25. The challenge of stabilisation

26. The challenge of stabilisation • Stabilising the stock of greenhouse gases in the range of 450 to 550 ppm CO2e requires urgent and substantial action- from developed and developing countries, because even if emissions from developed regions could be reduced to zero in 2050, the rest of the world would still need to cut emissions by 40%.

27. Identifying the costs of mitigation Stern Review, Chapter 9

28. Content • Calculating the costs of cutting GHG emissions • Abatement opportunities • Cutting no-fossil-fuel related emissions • Reducing demand for carbon-intensive goods and services • Improving energy efficiency • Low carbon technologies • Fossil fuel emissions • Conclusion

29. Calculating the costs of cutting GHG emissions • Any costs of cutting GHG emissions will ultimately be borne by the household • Basic concept: Compare benefits to the costs of cutting emissions • Benefits: Savings (for instance from less fossil fuel consumption) and feedbacks (like better air quality)

30. Calculating the costs of cutting GHG emissions • Costs: more ressources will be needed to change today's capital stock • Measuring the costs: for ressources traded at a perfect market- market prices inefficient marekts- shadow prices (subtract the additional rent from the market price)

31. Calculating the costs of cutting GHG emissions • Measuring the efficient level of GHG emissions: Marginal damage and marginal abatement cost analysis. The intersection of the two curves exhibit the efficient level. • Problem: MAC can only be used for a small change in emission reductions. In our case huge emission cuts are required. MAC could be misleading

32. Calculating the costs of cutting GHG emissions

33. Calculating the costs of cutting GHG emissions

34. Calculating the costs of cutting GHG emissions • Policy-makers don‘t know the cheapest way to achieve emission reduction • They can encourage housholds and firms to find those ways • Possible tools: • Emission taxes • Tradable carbon quotas • Task for policy-makers is to supply a frame and to „persuade“ the consumers to reduce their spending on emission-intensive products

35. Content • Calculating the costs of cutting GHG emissions • Abatement opportunities • Cutting no-fossil-fuel related emissions • Reducing demand for carbon-intensive goods and services • Improving energy efficiency • Low carbon technologies • Fossil fuel emissions • Conclusion

36. The range of abatement opportunities • All abatement opportunities can be ranked among their cost per unit of greenhouse gas reduction • Some of them can be very cheap or even save money • Others might be rather expensive today but are expected to get cheaper throughout time

37. The range of abatement opportunities

38. Content • Calculating the costs of cutting GHG emissions • Abatement opportunities • Cutting no-fossil-fuel related emissions • Reducing demand for carbon-intensive goods and services • Improving energy efficiency • Low carbon technologies • Fossil fuel emissions • Conclusion

39. Non-fossil-fuel relatedemissions “Two fifths of global emissions are from non-fossil fuel sources; there are opportunities here for low-cost emissions reductions, particularly in avoiding deforestation.”

40. Non-fossil-fuel relatedemissions • 40% of today‘s GHG-emissions • Sources: • Agriculture, ex.: life stock • Waste, ex.: landfill sites, wastewater treatment • Wastage in the production of fossil fuels • Industrial processes • Deforestation (20% = 8 Gt Co2/year)

41. Non-fossil-fuel relatedemissions Example Deforesation: • 3 types of costs (curbing deforestation): • Opportunity costs • Administration costs • Costs of managing transition • Comparison with 4th IPCC report

42. Stern review 8 countries (70% of land use emissions) Stop deforestation US$ 1-2/tCO2 Plant new forests US$ 5-15/tCO2 4th IPCC report Forestry mitigation Up to US$ 100/GtCO2eq 1.3-4.2 GtCO2eq/yr 50% at a cost under 20/GtCO2eq Differences between regions Non-fossil-fuel relatedemissions

44. Content • Calculating the costs of cutting GHG emissions • Abatement opportunities • Cutting no-fossil-fuel related emissions • Reducing demand for carbon-intensive goods and services • Improving energy efficiency • Low carbon technologies • Fossil fuel emissions • Conclusion

45. Reducing demand for carbon-intensive goods and services • Politic-possibilities • price signals • regulations • provision of better information • changing consumer preferences • “win-win”-situations • conflicts

46. Improving energy efficiency “Improving Energy efficiency and avoiding waste offer opportunities to save both emissions and resources, though there my be obstacles to the adoption of these opportunities.”

47. Improving energy efficiency • Technical potential improved ten-fold or more in the industrial countries • Further gains are possible • Market barriers and failures: • the cost of time • a lack of information • capital constraints • misaligned incentives • together with behavioral and organizational factors affecting economic rationality in decision-making.

48. Content • Calculating the costs of cutting GHG emissions • Abatement opportunities • Cutting no-fossil-fuel related emissions • Reducing demand for carbon-intensive goods and services • Improving energy efficiency • Low carbon technologies • Fossil fuel emissions • Conclusion

49. Low Carbon Technologies “Options for low-emission energy technologies are developing rapidly, though many remain more expensive than conventional technologies.”

50. Low Carbon Technologies Wide range of options: • Wind • Ocean • Solar energy • Carbon capture and storage (CCS) • Hydrogen • Nuclear power • Hydroelectric power • Bioenergy • Decentralized power generation • Fuel cells • Hybrid- and electric-vehicle technology