The Next Energy Transition: Transformative Pathways, Choices and Opportunities

This report provides a high-level summary of the transformational scenario pathways developed by the IIASA Energy Program within the framework of the Global Energy Assessment (GEA). These pathways approach the global transition toward sustainable development in an integrated, holistic manner, taking a broad view of the four main energy challenges faced by society in the 21st century: providing universal access to modern energy for all; avoiding dangerous climate change; reducing the impacts of energy on human health and the environment; and enhancing energy security. Developing solutions to these challenges is one of the chief aims of policy makers, and for this reason this report attempts to synthesize a multitude of strategic insights that have resulted from the pathways analysis. The overarching objective of the report is to provide guidance on how to facilitate the transformation of the energy system to achieve the multiple energy objectives. Focus is given to the required pace of the transformation at both the global and regional levels, as well as to the types of measures that will be needed to ensure a successful transition. This report is complemented by three interactive, web-based analytical tools, which have been developed by the IIASA Energy Program in support of this study: (1) the GEA Scenario Database, which documents the full suite of transition pathways in great detail, allowing the user to explore the consequences of different supply and demand-side technology choices for the feasibility and costs of reaching the multiple energy objectives at both the global and regional levels; (2) the IIASA ENE-MCA Policy Analysis Tool, which permits the concurrent assessment of synergies and trade-offs between the multiple energy objectives at the global scale; and (3) the IIASA Energy Access Tool (ENACT), which helps gauge the effectiveness of various energy access policies and measures in the major developing regions of the world

The IIASA Energy-Multi Criteria Analysis Tool (ENE-MCA)

Researchers at the International Institute for Applied Systems Analysis (IIASA), building on work carried out within the framework of the Global Energy Assessment (GEA), have developed an interactive web-based scenario analysis tool that permits the concurrent assessment of synergies and trade-offs between multiple energy objectives at the global scale. This software, known as the IIASA Energy-Multi Criteria Analysis Policy Tool (ENE-MCA), is designed to assist national policy makers in their strategic policy planning processes. The tool extends work undertaken for the GEA and, as such, is built on the extensive set of global energy and environmental scenarios that have been generated as part of the GEA process. This document serves as an introduction to the ENE-MCA tool and as a brief manual for the typical user

Quantifying uncertainties influencing the long-term impacts of oil prices on energy markets and carbon emissions

Oil prices have fluctuated remarkably in recent years. Previous studies have analysed the impacts of future oil prices on the energy system and greenhouse gas emissions, but none have quantitatively assessed how the broader, energy-system-wide impacts of diverging oil price futures depend on a suite of critical uncertainties. Here we use the MESSAGE integrated assessment model to study several factors potentially influencing this interaction, thereby shedding light on which future unknowns hold the most importance. We find that sustained low or high oil prices could have a major impact on the global energy system over the next several decades; and depending on how the fuel substitution dynamics play out, the carbon dioxide consequences could be significant (for example, between 5 and 20% of the budget for staying below the internationally agreed 2 ∘C target). Whether or not oil and gas prices decouple going forward is found to be the biggest uncertainty

Summary of International Transport Energy Modeling Workshop

The NextSTEPS program at ITS-Davis convened a one-day workshop on international transportation energy modeling (iTEM), focused on comparing the frameworks and scenario projections from four major global transport models: -- Global Change Assessment Model (GCAM) by Pacific Northwest National Laboratory (PNNL) and ITS-Davis, -- MESSAGE-Transport (Model for Energy Supply Strategy Alternatives and their General Environmental Impact) by the International Institute for Applied Systems Analysis (IIASA), -- Mobility Model (MoMo) by the International Energy Agency, and -- Roadmap by the International Council on Clean Transportation (ICCT). Highlights: -- Projections of "baseline" global transportation energy use rise from 98 EJ in 2010 to 160-250 EJ by 2050. -- There are considerable differences in historical data for some modes, both globally and for individual countries (particularly non-OECD countries). Variability in estimates of transportation activity are in most cases much larger than energy differences. -- Global average vehicle ownership rates are projected to range from 270 to 450 per 1,000 people by 2050 with wide ranges across countries: 700-1,075 for the US by the middle of the century (US is around 700 today), 100-650 for China, and 80-380 for India across four models. -- All models rely mainly on GDP to estimate the future demand for freight and hold the base year modal shares (e.g. truck v. rail) roughly constant through 2050. In reality, future evolution will depend on characteristics of products (e.g. type of commodities) being shipped, technologies available for freight and their efficiencies, and policies and infrastructure. -- Current policy commitments toward EVs, PHEVs and H2FCVs (and thus baseline projections) maybe below the numbers suggested by iTEM models as required for meeting climate targets (e.g., 2 degrees C). -- Improvements in data quality and the representation of car ownership and use across the models were identified as priorities. Modeling transport energy use can either be done by estimating how far people travel and what mode of transportation they choose or by estimating how many vehicles there are and how far each one travels. These are complementary approaches, and in theory they should both lead to the same answer. The former approach, used in "service demand" models, seem more intuitive when one wants to model societal shifts in modes of transportation, either in emerging economies as they develop or in developed economies as they decarbonize; but collecting data on service demand is notoriously difficult. In contrast, vehicle stock models use readily-available vehicle sales data, but are harder to use in future-state, what-if scenarios (particularly in estimating modal shift behaviors) and thus require special attention by experts. The four iTEM models are different in terms of scope (GCAM and MESSAGE cover all sectors of the energy system vs. MoMo and Roadmap which cover transportation only) and model structure (GCAM and MESSAGE rely on internal drivers, particularly the costs of technology and travel, to project future changes whereas MoMo and Roadmap rely on experts' judgments and detailed analysis of technology and policies to drive long-term changes). Yet, owing to these differences, the models are highly complementary and in some cases can be used jointly to answer questions that no single model can tackle on its own. The following summary shares some of the comparisons and findings from the workshop

Energy Investments under Climate Policy: A Comparison of Global Models

The levels of investment needed to mobilize an energy system transformation and mitigate climate change are not known with certainty. This paper aims to inform the ongoing dialogue and in so doing to guide public policy and strategic corporate decision making. Within the framework of the LIMITS integrated assessment model comparison exercise, we analyze a multi-IAM ensemble of long-term energy and greenhouse gas emissions scenarios. Our study provides insight into several critical but uncertain areas related to the future investment environment, for example in terms of where capital expenditures may need to flow regionally, into which sectors they might be concentrated, and what policies could be helpful in spurring these financial resources. We find that stringent climate policies consistent with a 2 degrees C climate change target would require a considerable upscaling of investments into low-carbon energy and energy efficiency, reaching approximately $45 trillion (range:$30-75 trillion) cumulative between 2010 and 2050, or about $1.1 trillion annually. This represents an increase of some$30 trillion ($10-55 trillion), or$0.8 trillion per year, beyond what investments might otherwise be in a reference scenario that assumes the continuation of present and planned emissions-reducing policies throughout the world. In other words, a substantial "clean-energy investment gap" of some $800 billion/yr exists -- notably on the same order of magnitude as present-day subsidies for fossil energy and electricity worldwide ($523 billion). Unless the gap is filled rather quickly, the 2 degrees C target could potentially become out of reach

Locked into Copenhagen pledges - Implications of short-term emission targets for the cost and feasibility of long-term climate goals

This paper provides an overview of the AMPERE modeling comparison project with focus on the implications of near-term policies for the costs and attainability of long-term climate objectives. Nine modeling teams participated in the project to explore the consequences of global emissions following the proposed policy stringency of the national pledges from the Copenhagen Accord and Cancun Agreements to 2030. Specific features compared to earlier assessments are the explicit consideration of near-term 2030 emission targets as well as the systematic sensitivity analysis for the availability and potential of mitigation technologies. Our estimates show that a 2030 mitigation effort comparable to the pledges would result in a further "lock-in" of the energy system into fossil fuels and thus impede the required energy transformation to reach low greenhouse-gas stabilization levels (450 ppm CO2e). Major implications include significant increases in mitigation costs, increased risk that low stabilization targets become unattainable, and reduced chances of staying below the proposed temperature change target of 2 degrees C in case of overshoot. With respect to technologies, we find that following the pledge pathways to 2030 would narrow policy choices, and increases the risks that some currently optional technologies, such as carbon capture and storage (CCS) or the large-scale deployment of bioenergy, will become "a must" by 2030

The Distribution of the Major Economies' Effort in the Durban Platform Scenarios

The feasibility of achieving climate stabilization consistent with the objective of 2 degrees C is heavily influenced by how the effort in terms of mitigation and economic resources will be distributed among the major economies. This paper provides a multi-model quantification of the mitigation commitment in ten major regions of the world for a diversity of allocation schemes. Our results indicate that a policy with uniform carbon pricing and no transfer payments would yield an uneven distribution of policy costs, which would be lower than the global average for OECD countries, higher for developing economies and the highest, for energy exporters. We show that a resource sharing scheme based on long-term convergence of per capita emissions would not resolve the issue of cost distribution. An effort sharing scheme which equalizes regional policy costs would yield an allocation of allowances comparable with the ones proposed by the Major Economies. Under such a scheme, emissions would peak between 2030 and 2045 for China and remain rather flat for India. In all cases, a very large international carbon market would be required

CO2 emission mitigation and fossil fuel markets: Dynamic and international aspects of climate policies

This paper explores a multi-model scenario ensemble to assess the impacts of idealized and non-idealized climate change stabilization policies on fossil fuel markets. Under idealized conditions climate policies significantly reduce coal use in the short- and long-term. Reductions in oil and gas use are much smaller, particularly until 2030, but revenues decrease much more because oil and gas prices are higher than coal prices. A first deviation from optimal transition pathways is delayed action that relaxes global emission targets until 2030 in accordance with the Copenhagen pledges. Fossil fuel markets revert back to the no-policy case: though coal use increases strongest, revenue gains are higher for oil and gas. To balance the carbon budget over the 21st century, the long-term reallocation of fossil fuels is significantly larger -- twice and more -- than the short-term distortion. This amplifying effect results from coal lock-in and inter-fuel substitution effects to balance the full-century carbon budget. The second deviation from the optimal transition pathway relaxes the global participation assumption. The result here is less clear-cut across models, as we find carbon leakage effects ranging from positive to negative because trade and substitution patterns of coal, oil, and gas differ across models. In summary, distortions of fossil fuel markets resulting from relaxed short-term global emission targets are more important and less uncertain than the issue of carbon leakage from early mover action