An integrated assessment model with endogenous growth

We introduce endogenous directed technical change into numerical integrated climate and development policy assessment. We distinguish expenditures on innovation (R&D) and imitation (international technology spillovers) and consider the role of capital investment in creating and implementing new technologies. Our main contribution is to calibrate and numerically solve the model and to examine the model’s sensitivity. As an application, we assess a carbon budget-based climate policy and vary the beginning of energy-saving technology transfer. Accordingly, China is a main beneficiary of early technology transfer. Herein, our results highlight the importance of timely international technology transfer for efficiently meeting global emission targets. Most of the consumption gains from endogenous growth are captured in the baseline. Moreover, mitigation costs turn out to be insensitive to changes in most of the parameters of endogenous growth. A higher effectivity of energy-specific relative to labor-specific expenditures on innovation and imitation reduces mitigation costs, though

Global Fossil Energy Markets and Climate Change Mitigation: An Analysis with REMIND

We analyze the dynamics of global fossil resource markets under different assumptions for the supply of fossil fuel resources, development pathways for energy demand, and climate policy settings. Resource markets, in particular the oil market, are characterized by a large discrepancy between costs of resource extraction and commodity prices on international markets. We explain this observation in terms of (a) the intertemporal scarcity rent, (b) regional price differentials arising from trade and transport costs, (c) heterogeneity and inertia in the extraction sector. These effects are captured by the REMIND model. We use the model to explore economic effects of changes in coal, oil and gas markets induced by climate-change mitigation policies. A large share of fossil fuel reserves and resources will be used in the absence of climate policy leading to atmospheric GHG concentrations well beyond a level of 550 ppm CO2-eq. This result holds independently of different assumptions about energy demand and fossil fuel availability. Achieving ambitious climate targets will drastically reduce fossil fuel consumption, in particular the consumption of coal. Conventional oil and gas as well as non-conventional oil reserves are still exhausted. We find the net present value of fossil fuel rent until 2100 at 30tril.US$with a large share of oil and a small share of coal. This is reduced by 9 and 12tril.US$ to achieve climate stabilization at 550 and 450 ppm CO2-eq, respectively. This loss is, however, overcompensated by revenues from carbon pricing that are 21 and 32tril.US$, respectively. The overcompensation also holds under variations of energy demand and fossil fuel supply

Common but differentiated leadership: strategies and challenges for carbon neutrality by 2050 across industrialized economies

Given their historic emissions and economic capability, we analyze a leadership role for representative industrialized regions (EU, US, Japan, and Australia) in the global climate mitigation effort. Using the global integrated assessment model REMIND, we systematically compare region-specific mitigation strategies and challenges of reaching domestic net-zero carbon emissions in 2050. Embarking from different emission profiles and trends, we find that all of the regions have technological options and mitigation strategies to reach carbon neutrality by 2050. Regional characteristics are mostly related to different land availability, population density and population trends: While Japan is resource limited with respect to onshore wind and solar power and has constrained options for carbon dioxide removal (CDR), their declining population significantly decreases future energy demand. In contrast, Australia and the US benefit from abundant renewable resources, but face challenges to curb industry and transport emissions given increasing populations and high per-capita energy use. In the EU, lack of social acceptance or EU-wide cooperation might endanger the ongoing transition to a renewable-based power system. CDR technologies are necessary for all regions, as residual emissions cannot be fully avoided by 2050. For Australia and the US, in particular, CDR could reduce the required transition pace, depth and costs. At the same time, this creates the risk of a carbon lock-in, if decarbonization ambition is scaled down in anticipation of CDR technologies that fail to deliver. Our results suggest that industrialized economies can benefit from cooperation based on common themes and complementary strengths. This may include trade of electricity-based fuels and materials as well as the exchange of regional experience on technology scale-up and policy implementation

Common but differentiated leadership: strategies and challenges for carbon neutrality by 2050 across industrialized economies

Given their historic emissions and economic capability, we analyze a leadership role for representative industrialized regions (EU, US, Japan, and Australia) in the global climate mitigation effort. Using the global integrated assessment model REMIND, we systematically compare region-specific mitigation strategies and challenges of reaching domestic net-zero carbon emissions in 2050. Embarking from different emission profiles and trends, we find that all of the regions have technological options and mitigation strategies to reach carbon neutrality by 2050. Regional characteristics are mostly related to different land availability, population density and population trends: While Japan is resource limited with respect to onshore wind and solar power and has constrained options for carbon dioxide removal (CDR), their declining population significantly decreases future energy demand. In contrast, Australia and the US benefit from abundant renewable resources, but face challenges to curb industry and transport emissions given increasing populations and high per-capita energy use. In the EU, lack of social acceptance or EU-wide cooperation might endanger the ongoing transition to a renewable-based power system. CDR technologies are necessary for all regions, as residual emissions cannot be fully avoided by 2050. For Australia and the US, in particular, CDR could reduce the required transition pace, depth and costs. At the same time, this creates the risk of a carbon lock-in, if decarbonization ambition is scaled down in anticipation of CDR technologies that fail to deliver. Our results suggest that industrialized economies can benefit from cooperation based on common themes and complementary strengths. This may include trade of electricity-based fuels and materials as well as the exchange of regional experience on technology scale-up and policy implementation.BMBF, 03EK3046A, Verbundvorhaben START: Strategic Scenario Analysis (START) - A first German-Australian focus projectEC/H2020/730403/EU/Innovation pathways, strategies and policies for the Low-Carbon Transition in Europe/INNOPATHSEC/H2020/838667/EU/resIlieNT EneRgy systems for climAte Change and susTaInable develOpmeNt/INTERACTIO

The ongoing nutrition transition thwarts long-term targets for food security, public health and environmental protection

The nutrition transition transforms food systems globally and shapes public health and environmental change. Here we provide a global forward-looking assessment of a continued nutrition transition and its interlinked symptoms in respect to food consumption. These symptoms range from underweight and unbalanced diets to obesity, food waste and environmental pressure. We find that by 2050, 45% (39–52%) of the world population will be overweight and 16% (13–20%) obese, compared to 29% and 9% in 2010 respectively. The prevalence of underweight approximately halves but absolute numbers stagnate at 0.4–0.7 billion. Aligned, dietary composition shifts towards animal-source foods and empty calories, while the consumption of vegetables, fruits and nuts increases insufficiently. Population growth, ageing, increasing body mass and more wasteful consumption patterns are jointly pushing global food demand from 30 to 45 (43–47) Exajoules. Our comprehensive open dataset and model provides the interfaces necessary for integrated studies of global health, food systems, and environmental change. Achieving zero hunger, healthy diets, and a food demand compatible with environmental boundaries necessitates a coordinated redirection of the nutrition transition. Reducing household waste, animal-source foods, and overweight could synergistically address multiple symptoms at once, while eliminating underweight would not substantially increase food demand

MAgPIE 4 – a modular open-source framework for modeling global land systems

The open-source modeling framework MAgPIE (Model of Agricultural Production and its Impact on the Environment) combines economic and biophysical approaches to simulate spatially explicit global scenarios of land use within the 21st century and the respective interactions with the environment. Besides various other projects, it was used to simulate marker scenarios of the Shared Socioeconomic Pathways (SSPs) and contributed substantially to multiple IPCC assessments. However, with growing scope and detail, the non-linear model has become increasingly complex, computationally intensive and non-transparent, requiring structured approaches to improve the development and evaluation of the model. Here, we provide an overview on version 4 of MAgPIE and how it addresses these issues of increasing complexity using new technical features: modular structure with exchangeable module implementations, flexible spatial resolution, in-code documentation, automatized code checking, model/output evaluation and open accessibility. Application examples provide insights into model evaluation, modular flexibility and region-specific analysis approaches. While this paper is focused on the general framework as such, the publication is accompanied by a detailed model documentation describing contents and equations, and by model evaluation documents giving insights into model performance for a broad range of variables. With the open-source release of the MAgPIE 4 framework, we hope to contribute to more transparent, reproducible and collaborative research in the field. Due to its modularity and spatial flexibility, it should provide a basis for a broad range of land-related research with economic or biophysical, global or regional focus

REMIND2.1: transformation and innovation dynamics of the energy-economic system within climate and sustainability limits

This paper presents the new and now open-source version 2.1 of the REgional Model of INvestments and Development (REMIND). REMIND, as an integrated assessment model (IAM), provides an integrated view of the global energy–economy–emissions system and explores self-consistent transformation pathways. It describes a broad range of possible futures and their relation to technical and socio-economic developments as well as policy choices. REMIND is a multiregional model incorporating the economy and a detailed representation of the energy sector implemented in the General Algebraic Modeling System (GAMS). It uses non-linear optimization to derive welfare-optimal regional transformation pathways of the energy-economic system subject to climate and sustainability constraints for the time horizon from 2005 to 2100. The resulting solution corresponds to the decentralized market outcome under the assumptions of perfect foresight of agents and internalization of external effects. REMIND enables the analyses of technology options and policy approaches for climate change mitigation with particular strength in representing the scale-up of new technologies, including renewables and their integration in power markets. The REMIND code is organized into modules that gather code relevant for specific topics. Interaction between different modules is made explicit via clearly defined sets of input and output variables. Each module can be represented by different realizations, enabling flexible configuration and extension. The spatial resolution of REMIND is flexible and depends on the resolution of the input data. Thus, the framework can be used for a variety of applications in a customized form, balancing requirements for detail and overall runtime and complexity

Investitionsstrategien zur Vermeidung von Klimawandel

Der anthropogene Klimawandel verlangt die Reduktion von Treibhausgasen. Diese Arbeit beschäftigt sich mit den Kosten und Strategien zur Vermeidung des Klimawandels. Dabei werden vor Allem Investitionsstrategien der Vermeidung untersucht. Die Arbeit is unterteilt in fünf Teile, die jeweils Unterfragen der allgemeinen Forschungsfrage untersuchen. Nach einer Einleitung in das Problem des Klimawandels und MakroÖkonomischen Mechanismen der Vermeidung werden diese Unterfragen in einzelnen Kapiteln beantwortet. Die Analyse basiert auf Integrated Assessment Modellen. Zuerst werden die Auswirkungen von technologischem Spillover in einem Mehrregionenmodell mit technologischem Wandel in Form von interregionalem Spillover analysiert. Modellergebnisse zeigen, daß je größer der Quotient zwischen Arbeits- und Energieeffizienz steigernden Spilloverintensität ist, desto geringer sind die Vermeidungskosten. Außerdem werden die Vorteile von Vorreitern und Anreize für eine Klimapolitik untersucht. Ein mehrregionales Hybridmodell mit einem detailierten Energiesystem wird benutzt, um die Investitionen in Energietechnologieen im Detail zu analysieren. In Klimapolitikszenarien wird der gesammte Energiekonsum verringert, während erneuerbare Energie und CCS Technologieen sofort ausgebaut werden. Verschiedene Regionen verfolgen grundsätzlich untershciedliche Vermeidungsstrategieen. Während ambitionierte Klimaschutzschranken zu moderaten globalen Kosten erreicht werden können, variieren die regionalen Kosten deutlich. Des Weiteren werden Integrated Assessment Modelle genutzt, um herauszufinden, was es bedeutet, wenn die Welt sich in den nächsten Jahren nicht auf eine klimafreundliche Politik einigen kann. Die Auswirkungen von frühzeitigen Investitionen in erneuerbare Energieen in erstbesten und zweitbesten Welten wird analysiert. Die Vermeidungskosten steigen signifikant, wenn die Implementierung von Klimapolitik verzögert wird. Hingegen verringert ein frühzeitiger Einsatz von erneuerbaren Energieen die globalen Kosten. In einem Hybridmodell mit fünf Regionen werden die Auswirkungen von Dynamik und Richtung des technologischen Wandels unter Klimapolitik untersucht. Es zeigt sich, daß die Vermeidungskosten und -strategieen sensitiv auf diese Variablen reagieren. Weitere Experimente deuten an, daß die Auswirkungen vom Spektrum der zur Verfügung stehenden Technologieen abhängt. Um die Rolle des endogenen technologischen Wandels für die Vermeidung des Klimawandels zu studieren, wird dieses Modell um eine neue Formulierung von Effizienssteigerungen erweitert. Es zeigt sich, daß Investitionen in die Effizienz von einigen Energiesektoren eine entscheidende Rolle für niedrige Vermeidungskosten spielen. In Klimapolitikszenarien können die durch technologische Einschränkungen erhöhten Vermeidungskosten durch F&E Investitionen in die Energieeffiezienz reduziert werden. Wie auch immer, zeigen die Ergebnisse dieser Arbeit die wichtige Rolle von Investitionsstrategien für die Vermeidungskosten von Klimawandel. DieWelt profitiert von frühzeitigen Investitionen in eine große Bandbreite von Technologieen und in Energieeffizienz. Dabei erbringen vor allem die unmittelbare Förderung und die hohe Diversität der Investitionen niedrige Vermeidungskosten.The substantial threat of anthropogenic climate change implies the reducing of greenhouse gas emissions. This thesis deals with the costs and strategies of climate change mitigation. In particular, investment strategies for climate change mitigation are investigated. The thesis is separated into five parts each focusing on subquestions of the overall research question. After an introduction into the problem of climate change and the important macro-economic mechanisms for mitigation, these subquestions are answered in separate chapters. For the analysis Integrated Assessment models are used. First, the impacts of technological spillovers under climate policies are analyzed by means of a multi-regional model with technological change in form of interregional spillovers. Model results indicate that the higher the ratio between the spillover intensities for energy and labour efficiency, the lower are mitigation costs. As well, first-mover advantages and commitment incentives for climate policy scenarios are investigated. A multi-regional hybrid model with a more complex energy system is used for studying investments into energy technologies in detail. In climate policy scenarios the entire energy consumption is reduced, while renewable energy and CCS technologies are expanded immediately. Different regions follow quite different mitigation strategies. While ambitious climate targets can be reached with moderate global costs, the regional costs show a high variance. In addition, Integrated Assessment models are used to investigate what happens if the world will not agree on a climate friendly policy within the next years. The impacts of early investments into renewable energy technologies in first-best and second-best worlds are analyzed. Mitigation costs increase significantly, if the climate policy implementation is delayed. In contrast, early deployment of renewable energy technologies reduces the global costs. Within a five-region hybrid model the impacts of dynamics and direction of technological change under climate change mitigation are studied. It turns out that mitigation costs and strategies are quite sensitive to these variables. Further experiments indicate that the impacts depend on the set of available technologies. For studying the role of endogenous technological change for climate change mitigation, this model is extended by a new formulation of efficiency improvements. It turns out that investments into the efficiency of some energy sectors play a crucial role for low mitigation costs. In climate policy scenarios, the increased mitigation costs of technological restrictions can be overcome by R&D investments into energy efficiencies. However, the results of this thesis demonstrate the important role of investment strategies for climate change mitigation costs. The world gains from early investments into both a broad portfolio of technologies and energy efficiencies. Thereby the immediate support and high diversity of investments mainly provide low mitigation costs

The impact of capital trade and technological spillovers on climate policies

In this paper, we present an intertemporal optimization model that is designed to analyze climate policy scenarios within a globalized world which is characterized by the existence of technological spillovers. We consider a type of technological spillovers that is bound to bilateral capital trade. Importing foreign capital that increases the efficiency of energy use represents a mitigation option that extends the commonly modeled portfolio. The technical details of the model are presented in this paper. The model is solved numerically. First model applications highlight the differences between climate policy analyses which either take or do not take technological spillovers into account. In the final part, we apply the model to investigate first-mover advantages and commitment incentives in climate policy scenarios. The existence of both is supported by simulation results.Climate policy Multi-region model Technological spillovers International trade