Network reinforcement requirements for Scotland and the rest of the UK (RUK) - and possible solutions for this

A novel multi-objective transmission expansion planning (MOTEP) tool has been developed to analyse, on a comprehensive geographical scale, the reinforcements required to a base case electrical transmission network following application of a chosen future energy scenario, and to generate optimal network expansion plans, designed to alleviate these areas of strain, for a range of crucial network planning objectives. Here, we report the application of the MOTEP tool to a base case predicted 2014 GB transmission network (thereby including already planned reinforcements such as the Beauly to Denny line) under heavy strain from three 2020 energy scenarios developed by the two-region UK MARKAL energy system model. Reinforcement requirements for Scotland and the RUK beyond 2014, along with optimal network expansion plan options, are examined

Environmentally Extended Input–Output Analysis of the UK Economy: Key Sector Analysis

The paper assesses the sustainability of investment in various economic sectors, with the aim of minimizing resource use and generation of emissions. The broad development focus of the paper and the potential for the proposed methodology to be applied in many different countries make it a useful methodological contribution to the global sustainability debate. The UK case is taken for illustration purposes, and (given the availability of the necessary data) this methodology could be applied in countries with various economic structures and specialisations. An environmentally extended static 123-sector UK input–output model is used, linking a range of physical flows (domestic extraction, use of water, and emissions of CO2, CH4, NOx) with the economic structure of the UK. A range of environmentally adjusted forward and backward linkage coefficients has been developed, adjusted according to final demand, domestic extraction, publicly supplied and directly abstracted water, amd emissions of CO2 and NOx,. The data on the final demandadjusted and environmentally adjusted forward and backward linkage coefficients were used in a multi-criteria decision-aid assessment, employing a NAIADE method in three different sustainability settings. The assessment was constructed in such a way that each sector of the UK economy was assessed by means of a panel of sustainability criteria, maximizing economic effects and minimizing environmental effects. This type of multi-criteria analysis, applied here for the first time, could prove to be a valuable basis for similar studies, especially in the developing world, where trade-offs between economic development and environmental protection have been the subject of considerable debate.input–output analysis; environmentally extended; MCDA; key sectors; sustainability; ecological economics; UK

Environmentally Extended Input-Output Analysis of the UK Economy: Key Sector Analysis

The paper assesses the sustainability of investment in various economic sectors, with the aim of minimizing resource use and generation of emissions. The broad development focus of the paper and the potential for the proposed methodology to be applied in many different countries make it a useful methodological contribution to the global sustainability debate. The UK case is taken for illustration purposes, and (given the availability of the necessary data) this methodology could be applied in countries with various economic structures and specialisations. An environmentally extended static 123-sector UK input-output model is used, linking a range of physical flows (domestic extraction, use of water, and emissions of CO2, CH4, NOx) with the economic structure of the UK. A range of environmentally adjusted forward and backward linkage coefficients has been developed, adjusted according to final demand, domestic extraction, publicly supplied and directly abstracted water, amd emissions of CO2 and NOx,. The data on the final demand-adjusted and environmentally adjusted forward and backward linkage coefficients were used in a multi-criteria decision-aid assessment, employing a NAIADE method in three different sustainability settings. The assessment was constructed in such a way that each sector of the UK economy was assessed by means of a panel of sustainability criteria, maximizing economic effects and minimizing environmental effects. This type of multi-criteria analysis, applied here for the first time, could prove to be a valuable basis for similar studies, especially in the developing world, where trade-offs between economic development and environmental protection have been the subject of considerable debate.

Natural resource scarcity and long-run development: central mechanisms when conditions are seemingly unfavourable

Using a dynamic model with non-renewable natural resources and endogenous knowledge creation, the paper analyses economic development under conditions which are generally considered as most unfavourable. We assume poor substitution between primary input factors, positive population growth and a limited supply of materials in the static part of the framework, as well as natural resources being an essential input into R&D, and constant or decreasing returns to innovative activities in the dynamic part. It is shown that there is an inverse relationship between input substitution and growth-enhancing sectoral change and that labour supply supports economic dynamics through the knowledge-creation effect. A permanent increase in living standards is achievable under free market conditions, but adjustment costs and errors in long-term expectations might impede this development.endogenous technological change, environment, natural resources, sustainability

What is the growth potential of green innovation? An assessment of EU climate policy options

This paper provides a model-based analysis of the cost-efficiency of different EU climate policy options that could direct innovation in the private sector towards an environmentally sustainable growth path. Our objective is to assess different policy options in order to identify an appropriate policy-mix of environmental and innovation market instruments in terms of their cost-effectiveness. For this purpose, we develop a fully-dynamic, multisectoral DSGE model with endogenous technological change where we specifically identify its environmental content and we calibrate the model for the EU and the rest of the world. Our results suggest that an appropriate policy mix should intensively stimulate R&D in the green sectors in the short-run and phase-it out by spreading the R&D support to all sectors of the economy in the medium-term. Although intuitive, the orders of magnitude presented in this paper should be interpreted with caution by taking into account the underlying assumptions of the model and identification of green innovation data.Carbon revenue recycling, climate change, directed technical change, double dividend, dynamic general equilibrium model, endogenous growth, R&D

THE ECONOMIC AND DISTRIBUTIONAL IMPACTS OF AN INCREASED CARBON TAX WITH DIFFERENT REVENUE RECYCLING SCHEMES. ESRI RESEARCH SERIES NUMBER 95 OCTOBER 2019

The recent all Government Climate Action Plan proposes an increase in the Irish carbon tax along a trajectory which reaches C80 by 2030. In line with this, this study investigates the economic, household level and environmental impacts of increasing the current carbon tax in Ireland from C20 per tonne of CO2 to C30 in 2020, further increasing it by C5 annually, thus reaching C80 (in nominal terms) by 2030. In our analysis, we examine not only the impacts of the increase in carbon tax alone, but also the impacts of how the carbon tax revenue is used, i.e. recycled. Our analysis shows that increasing the carbon tax will help Ireland reduce its emissions somewhat, but more initiatives are needed to reach the EU targets. Furthermore, an increase in the carbon tax will have limited impacts on GDP. The choice of how to use the revenues from the increased carbon tax will have significant implications for both macroeconomic impacts and household distributional impacts. Depending on the policy goal, the appropriate recycling scheme can reduce GDP impacts, decrease government debt, limit inflation or decrease inequality across households types

TECHNICAL DOCUMENTATION OF I3E MODEL VERSION 2. ESRI SURVEY AND STATISTICAL REPORT SERIES NUMBER 77 September 2019

This paper provides a technical description of the Ireland Environment, Energy and Economy (I3E) model. The I3E model is an intertemporal computable general equilibrium model with multiple firms, one representative household group, multiple commodities, government, enterprises, and rest of the world accounts. It describes the Irish economy in sectoral detail. This model includes a detailed description of energy inputs and concomitant greenhouse gas emissions and has been developed with the purpose of investigating the economic and environmental impacts of climate policies for Ireland

Towards an Innovation-Intensive Circular Economy. Integrating Research, Industry and Policies

The report ‘Towards an Innovation-intensive Circular Economy. Integrating research, industry, and policies’ is a result of the cooperation between FEEM and Università Cattolica. The report proposes an original perspective to the circular economy as a paradigm of change that involves the whole production system. While material circularity is increasing under the pressure of decades of waste/recycling policies in Europe and Italy, a ‘new’ circular economy more intensive of technological and social innovation is establishing itself beyond the waste/recycling system, and it involves the material and organisational efficiency of enterprises and the whole production/consumption systems. The report starts from a stocktaking of definitions, public policies, quantifications, innovations, and institutional initiatives on the circular economy in Europe and in Italy. Two ‘integrative approaches’ are then proposed for achieving a better interaction between research, industry, and policies. The first approach exploits the concepts of ‘System of innovation’ (national, regional, sectoral) to redefine the process towards a circular economy. In such a ‘System of innovation’, enterprises are at the core, and the sub-systems of policies, finance, research/university, and civil society can contribute, through network interactions, to the change of the industrial and consumption paradigms towards resource efficiency and circularity. By means of this approach, it is easier to understand the importance of internal factors (for example industrial capabilities and strategies) as well external factors (for example European research programmes and finance) in creating opportunities or barriers to the circular economy. The second ‘integrative’ approach mirrors the intrinsically systemic features of the circular economy by suggesting to put it in connection to other major transitions of this phase, in particular decarbonisation and the bioeconomy, through a NEXUS-type approach. The interactions between circular economy, decarbonisation, and the bioeconomy are several but not necessarily they are synergic in that potential conflicts may arise. Synergies and conflicts, for example through an intensive use of biomass for energy, are not fully recognised by policies, which are still designed and implemented with a sector-minded approach. This can impair the performance of enterprises in pursuing a profitable circularity strategy. The report also addresses some open issues in the ‘economics of the circular economy’, like the low prices of primary commodities that do not create incentives to circularity innovations, thus assigning a major burden to policy instruments (for example fiscal instruments), and the changing attitude of the financial sector, which is moving towards the adoption of circularity criteria in the allocation for financial resources

Materializing policies for sustainable use and economy-wide management of resources: biophysical perspectives, socio-economic options and a dual approach for the European Union

Policies for Sustainable Use and economy-wide Management of natural Resources (SUMR) throughout the production and consumption system are faced with environmental and socio-economic requirements and regulatory constraints. Based on empirical findings of ongoing trends of resource use, decoupling from economic growth, and transregional problem shifting, the paper outlines a potentially sustainable biophysical basis for production and consumption in the EU. It discusses the main challenges for the major resource groups, describing the specific and the common tasks with regard to biomass, fossil fuels, metals, non-metallic minerals. Adopting a medical metaphor, it suggests that policies for SUMR should follow a dual approach reflecting the long-term need for a main cure of the socio-industrial metabolism in form of a conditioning towards a more mature, resource efficient, and renewables based constitution on the one hand, and a fine tuning of selected material flows (e.g. for optimized recycling and control of hazardous compounds) on the othe hand. Both strategies are deemed complementary and necessary to reduce environmental impact and increase the utility of material use. Action required is exemplified with regard to the three pillars of SUMR, i.e. improved orientation, information and incentives. --Material efficiency,dematerialization,renewables,socio-industrial metabolism,resource use,environmental impacts,sustainable production & consumption,bioeconomy

The evaluation of national accounting matrices with environmental accounts (NAMEA) as a methodology for carrying out a sustainability assessment of the Scottish food and drink sector

This report introduces environmental input-output (IO) accounts for Scotland as an example of a NAMEA framework. It provides an introduction to the use of basic IO multiplier methodology, which can be applied to examine pollution/waste generation and/or resource use under production and consumption accounting principles