Global and Regional Emissions and

Mitigation Policies
(with Application of ERB model for India)

P.R. Shukla
 Top Down models
 Energy Economy linkages
 Partial Equilibrium in energy markets through price
adjustments
Endogenous determination of prices
 Feedback of prices on GDP
 Demand endogenously determined
Supply of energy, demographic parameters exogenously
specified
 ERB Model : Application for India
 Disaggregation by fuel type
Conventional oil, conventional gas, coal, nuclear power,
hydroelectric power, solar electric power
 Global scale and regional detail
Nine Regions - US, OECD West, Japan-Australia-New
Zealand, EE/FSU, Middle East, China and other South
Asian countries, Latin America, Africa, and India
Long-term applicability : Terminal year 2095
 Four modules
Supply, Demand, Energy balance, GHG emissions
 Overview: ERB

Regional Regional Regional

Population Labour GNP
Forces Regional
Energy
Demands
Technical
Regional Change
Labour
Productivities
Global
Regional Regional World Supplies CO2
taxes and Prices Prices and Emissions
tariffs Demands

Regional
resource
constraints Regional
Energy
Supplies
Technology
and Cost
Char.
 Supply
 Supply categories
 Resource constrained exhaustible
conventional oil and gas
production rates follow logistic paths
 Resource constrained renewable
hydro
production rates follow logistic paths
 Backstop
 unconventional oil and gas, coal, solar and nuclear
 infinitely elastic supply schedule
 Supply by grades
 Demand

 Demand depends on population, GNP, and prices

 Regional prices of oil, gas and coal determined from
world prices, transportation cost and taxes or subsidies
 Regional prices of secondary fuels from the price of
six primary energy fuels
 Cost and supply of hydro determined exogenously
 Market share of five fuels determined by logit
framework
 Demand

 Energy service prices for Residential/Commercial,

Transport and Industry sectors
 Sectoral energy service demand is determined using
income and price elasticities
 Fuel shares, fuel rates, and technological
improvement determine fuel demand in end-use
sectors
 Fossil fuel demand for primary energy is sum of
demand from end-use sectors, electric utilities and
synfuel conversion from coal.
 Energy balances
 Markets for nuclear, solar and hydro are
cleared as identities
 Energy market for oil, gas and coal are cleared
through price adjustments in an equilibrium
framework
 Excess demand in each of the markets as
function of prices
 Price elasticities obtained by numerical
procedure and used to revise the prices for
market clearance
 Greenhouse Gas Emissions

 Carbon emissions determined by applying

carbon coefficients

 Zero carbon release coefficients for nuclear,

solar and conservation
 Key parameters in Reference Case

 Population
 Annual growth rate for India: 1.1 % (1990-2050)
 Labour productivity
 Annual growth rate for India: 4 % (1990-2050)
 Rate of exogenous end-use energy efficiency
improvement
 Annual growth rate for India: 2 % (1990-2050)
 Fossil fuel resource base
 Non-greenhouse environmental costs of fuels
Assumptions : Non-intervention scenarios

Scenario Population Economic Energy Supplies

Growth
IS92a World Bank (1991) 1990-2025: 2.9% 12000 EJ Conventional Oil,
11.3 billion by 2100 1990-2100: 2.3% 13000 EJ Natural Gas.
Solar cost fall to $0.075/kWh.
199 EJ/yr ofbiofuels available
at $70/barrel.
IS92c UN M edium-Low1990-2025: 2.0% 8000 EJ Conventional Oil,
Case: 1990-2100: 1.2% 7300 EJ Natural Gas. Nuclear
6.4 billion by 2100 cost decline by 0.4% annually.
IS92e Same as ‘a’ 1990-2025: 3.5% 18400 EJ Conventional Oil,
1990-2100: 3.0% Gas same as ‘a’.
Phase out Nuclear by 2075.
Source: Climate Change 1994, IPCC
 Intervention scenarios

 Advance technologies
 Hydrogen fuel cells as alternative power source
 Low cost biomass source with 20 percent of biomass

available at $1.40 per GJ and 80 percent at $2.40 per GJ

by 2020
 Exogenous global end-use energy intensity improvement

rate reaches 2 percent per year by 2050

 Carbon Tax
 $100 tax per tonne of carbon content in the fuels imposed
in each region
 Stabilisation of emissions
 Global carbon emissions restricted to 7850 TgC (550
ppmv) in the terminal year
 Regional GDP Reference Case
250

200
Trillion Dollars

150

100

50

0
1990 2005 2020 2035 2050 2065 2080 2095
Year
US OECD West JANZ EE/FSU
ACENP MIDEAST AFR LA INDIA
 Global Carbon emissions: Reference Case

25 US OE CD W es t
JA NZ E E /FS U Region 1990 2095
A CE NP M IDE A S T US 23 12
20 OECD West 17 7
A FR LA
INDIA JANZ 6 3
15 AFR 3 12
EE/FSU 27 12
BtC

LA 4 7
10
MIDEAST 3 4
ACENP 15 35
5 India 3 10

0
1990 2005 2020 2035 2050 2065 2080 2095
 Global Primary Energy Consumption:
Reference Case
1400
1200
1000

800
EJ

600
400

200
0
1990 2005 2020 2035 2050 2065 2080 2095
US OECD West JANZ EE/FSU ACENP MIDEAST AFR LA INDIA

1370 EJ 123 EJ
 Global Primary Energy Use by Fuel Type:
Reference Case

1600

1200
Exajoules

800

400

0
1990 2005 2020 2035 2050 2065 2080 2095
Year
OIL GAS COAL BIO HYDRO SOLAR NUCLR
 Price of traded fuels - IS92a
20
18
16
14
1985 US$/GJ

12
10
8
6
4
2
0
1990 2005 2020 2035 2050 2065 2080 2095
Year
OIL GAS COAL
Energy Intensity IS92a
Global Primary Energy Consumption: Tax Cases

1600
1400

1200
1000
EJ

800
600

400

200
0
1990 2005 2020 2035 2050 2065 2080 2095

No tax $10 Tax $100 Tax $150 Tax

 Primary Energy Consumption in India : Tax Cases

140

120

100
Exajoules

80

60

40

20

0
1990 2005 2020 2035 2050 2065 2080 2095
Year
No Tax 10$ Tax 100$ Tax 150$ Tax
Global Carbon Emissions Tax Cases

25000

20000
Carbon

15000
 Carbon Emissions in India: Tax Cases

3000

2500
bon

2000
 ERB Tax Cases - Global v/s India

Cumulative - 1990 to 2095

Global India
Tax Level Carbon Energy Carbon Energy
mitigation (%) reduction (%) mitigation (%) reduction (%)
$10 5 2 4 2
$25 12 5 10 4
$50 24 10 19 7
$100 40 19 30 12
$150 49 26 35 20
 Advance Technology

250
200
Exajoules

150
100
50
0
2005 2035 2065 2095
Year
Oil Gas Coal Bio Hydro Solar Nuclear
 $100 Tax
150

100
Exajoules

50

0
2005 2035 2065 2095

Oil Gas Coal Bio Hydro Solar Nuclear

 Stabilisation

150

100
Exajoules

50

0
2005 2035 2065 2095
Year

Oil Gas Coal Bio Hydro Solar Nuclear

 Carbon Emissions
4000
3500
Teragrams Carbon

3000
2500
2000
1500
1000
500
0
2005 2035 2065 2095
Year

IS92c IS92e TECH TAX STAB

 Methane Emissions
20
Million tonnes

15

10

0
2005 2035 2065 2095
Year

IS92c IS92e TECH TAX STAB

 N2O Emissions

200
Thousand tonnes

150

100

50

0
2005 2035 2065 2095
Year

IS92c IS92e TECH TAX STAB

 Global Primary Energy Use - Scenarios
3000

2500

2000
Exajoules

1500

1000

500

0
1990 2005 2020 2035 2050 2065 2080 2095

Year

IS92a IS92c IS92e Adv.Tech $100 Tax 550 ppm