Climate Policy, Technology Choice, and Multiple Equilibria in a Developing Economy

Economy-wide effects of international and Russia's climate policies

The United States is in the midst of an energy revolution, spurred by advancement of technology to produce unprecedented supplies of oil and natural gas. Simultaneously, there is an increasing concern for climate change attributed to greenhouse gas (GHG) emissions that, in large part, result from burning fossil fuels. An international consensus has concluded that the U.S. and other developed nations have an imperative to reduce GHG emissions to address these climate change concerns. The global desire to reduce GHG emissions has led to the development and deployment of clean energy resources and technologies, particularly renewable energy technologies, at a rapid rate. At the same time, each of the major energy sectors—the electric grid, industrial manufacturing, transportation, and the residential/commercial consumers— is increasingly becoming linked through information and communications technologies, advanced modeling and simulation, and controls. Coordination of clean energy generation technologies through integrated hybrid energy systems, as defined below, has the potential to further revolutionize energy services at the system level by coordinating the exchange of energy currency among the energy sectors in a manner that optimizes financial efficiency (including capital investments), maximizes thermodynamic efficiency (through best use of exergy, which is the potential to use the available energy in producing energy services), reduces environmental impacts when clean energy inputs are maximized, and provides resources for grid management. Rapid buildout of renewable technologies has been largely driven by local, state, and federal policies, such as renewable portfolio standards and production tax credits that incentivize investment in these generation sources. A foundational assumption within this program plan is that renewable technologies will continue to be major contributors to the future U.S. energy infrastructure. While increased use of clean renewable technologies will aid in achieving reduced GHG emissions, it also presents new challenges to grid management that must be addressed. These challenges primarily derive from the fundamental characteristics of variable renewable generators, such as wind and solar: non-dispatchability, variable production, and reduced electromechanical inertia. This document presents a preliminary research and development (R&D) plan for detailed dynamic simulation and analysis of nuclear-renewable hybrid energy systems (N-R HES), coupled with integrated energy system design, component development, and integrated systems testing. N-R HES are cooperatively-controlled systems that dynamically apportion thermal and/or electrical energy to provide responsive generation to the power grid.

This article introduces export credit agencies (ECAs) as highly influential actors in international trade and global energy development. In the energy sector, official export financing stimulates international trade in energy-related technologies and promotes energy development in countries associated with high political risk. Adverse competition between ECAs has produced a demand among governments and other actors for international governance. The article explores the origins and effectiveness of international rules, and identifies three challenges to the current OECD-centred governance arrangements. First, the growing influence of ECAs from non-OECD countries is challenging the legitimacy and effectiveness of the OECD as an institutional venue for negotiating rules. Second, there are growing tensions between the national economic objectives that underpin the mandates and operations of ECAs, and their global implications. And third, as official export financing overwhelmingly benefits large-scale, carbon-intensive energy development, a number of ECAs have been criticized for undermining efforts to place developing countries on a more sustainable energy path. The article is pessimistic about the prospect of fundamental reform, as aligning official export financing with global policy objectives may require governments to enact fundamental changes to the mandates and structures of ECAs that compromise their effectiveness as instruments of national export promotion. Policy Implications • The growing influence of non-OECD countries in the international market for official export financing will generate new demands for international rules from governments and other stakeholders. • Given the global impacts of ECAs, it will become increasingly difficult for governments to insulate themselves from pressures to align their mandates and activities with broader sustainable development objectives. • The role of official export financing in the energy sector demonstrates the extent to which mitigating global climate change requires a better integration of international trade and climate policy. • As more and more countries establish ECAs, it will become increasingly difficult to reach a consensus on international rules. • When benefiting exports related to oil, gas and coal-based power generation, official export financing reduces the capital costs of large-scale fossil fuel-based energy development in developing countries. • The ‘greening’ of official export financing in the energy sector would be accelerated by fiscal and regulatory policies in both exporting and importing countries that are favourable to clean technology and renewable energy companies.

International climate policy is one of the most fascinating issues in foreign policy, yet in recent years it has become one of the most contentious. The failure of the conference in The Hague revealed, among other things, strongunderlying rifts in the transatlantic relationship. As the self-acclaimed worldleader, the United States is not in a position to exert leadership in this vital area owing to a mixture of constitutional constraints and an ever-growing cultural dependence on fossil fuels such as oil and gas. It therefore falls to the European Union to take up this challenge. This will require careful coalition building with the rest of the world as well as confidence in the ability of Europe to develop a united position, to stick to that position and to translate the rules of the Kyoto Protocol into stringent domestic climate policy. The climate change regime is at a crossroads. At the resumed COP-6 con-ference, the Parties must decide whether to continue the process under theassumption ‘that global problems require global solutions’ or whether to turn to the more regional concept of ‘think globally, act locally’. In either case, steering climate policy in this century on to a successful path will require the skills and dedication not only of natural scientists and technology developers, but also of those in the foreign policy community.

The deployment of new energy technologies and the need for local learning

Building back better after the COVID-19 pandemic means public investment in low-carbon technologies that deploy rapidly, create jobs, and distribute benefits widely. These desirable criteria are all associated with small-scale ''granular'' technologies like solar panels with relatively low unit investment costs-compared with large-scale ''lumpy'' technologies like carbon capture and storage. Countries vary widely in the technological granularity of their green recovery funding programs, with the UK as an outlier in the lumpiness of its investment choices.

With China ’s rapid economic development, energy is consumed in a large amount at the same time. It is difficult to achieve sustainable development in the long-term extensive use of energy. Changing the use of energy and developing new energy technologies can not only ease the current energy supply problem in China, but also contribute to the development of circular economy in china. The best path for new energy development is an important guarantee for the development of circular economy, through the use of new energy technologies to achieve sustainable development goals and improve the quality of circular economy, This paper combines the research and application of new energy technologies in the development of China's circular economy to find the problems in the development and use of new energy technologies: insufficient government policy support, lack of talents in the development of new energy technologies, and lack of research and development and innovation capabilities in new energy technologies. Practical solutions are proposed: perfecting policies and regulations, cultivating new energy technology talents through multiple channels, improving independent research and development and innovation capabilities, finding the best path for China's new energy development, accelerating the upgrade of new energy technologies and thus promoting China's development of a circular economy.

Comparing energy-technology alternatives from an environmental perspective

Analysing the costs and benefits of climate policy: Value judgements and scientific uncertainties

This study investigates the effects of incremental global warming, specifically the transition from 1.5 °C to 2.0 °C, on drought conditions in the Iberian Peninsula (IP). Our findings confirm a substantial increase in the frequency and intensity of droughts in the IP due to anthropogenic climate change. We highlight the importance of temperature in drought representation and underscore the urgent need to limit global warming below 1.5 °C, in line with international climate policies. The analysis reveals that the exacerbation of drought conditions is more pronounced under higher emission scenarios, particularly RCP8.5, emphasizing the critical role of emission reduction in climate change mitigation. Furthermore, a substantial increase in affected land area and population exposure to drought is observed, especially under the higher-emission scenario. Climate change emerges as the primary factor contributing to increased drought exposure, with emission reduction efforts offering potential mitigation. To overcome limitations associated with model uncertainties, a multi-model multi-variable ensemble approach was employed to enhance the regional specificity of the findings. This provides valuable insights for local climate adaptation and mitigation strategies. Results suggest that mitigating anthropogenic warming by 0.5 °C to achieve the 1.5 °C warmer climate rather than 2.0 °C may provide benefits for future drought risks and impacts in the IP and underscore the urgency of implementing stringent climate policies. By offering a comprehensive assessment of drought conditions and population exposure, this study informs decision-making and climate resilience strategies, emphasizing the need for immediate action to mitigate adverse impacts on ecosystems and human populations.

A SHIFT towards interest-driven, opportunity-based and more voluntary actions by combining bottom-up with top-down elements (Falkner, 2016).Interactive learning and experimentation at different levels of global governance have become highly important, and these complex global interactions are increasingly regarded not as obstacles but as opportunities for innovation and interactive learning (Sovacool, 2011).Global climate governance relates not only to the legal system of the climate regime but also to various public and private initiatives at different scales and across sectors.Scholars studying the complex multi-actor and multi-sector characteristics of the system have therefore begun to conceptualize global multi-level climate governance as an opportunity structure for the generation and diffusion of climate-related innovation.The topic of this special issues is climate governance within a multi-level and multi-sectoral global system.The work argues that global climate governance today aims essentially to activate the dynamic potential of each level of the global governance system, the level of world regions as well as the level of provinces and local communities.Horizontal peer-to-peer learning between countries, cities and regions, as well as vertical up-scaling of best practice, has created a dynamic of change.The cross-sectoral approach has become important as far as the mobilizing of economic interests (e.g. in the construction sector) and the use of co-benefits is concerned.This special issue intends to offer a better understanding of the nature and variety of, and linkages between, initiatives taken and governance functions delivered within the broader 'climate governance landscape ' (Betsill et al., 2015).It analyses various climate governance activities in the European Union (EU), India and China through a systemic perspective.The EU may be regarded as the strongest regional sub-system of the global system, although the BRICS countries of China and India play a comparable role, as countries both with a similar scope and with explicit multi-level climate policy activities.The systematic dimension of global climate governance is described in the introductory article 'Multi-level climate governance as a global system' by Martin Jnicke.The author analyses the potential of the global climate governance system, which is characterized by a multiplicity of access points and incentives for innovation and interactive learning.It is regarded as a 'multi-impulse-system', where the sum of even weak impulses from different parts of the system can play the role of a strong instrument.The global multi-level climate governance structure is also characterized by a specific global knowledge base and a global policy arena, allowing for climate-related agenda-setting and the mobilization of interests at each level.It is taken as an opportunity structure for ambitious innovation-based climate strategies based on interactive lesson-drawing from best practice.The lesson to be learned at all levels of the system is the potential for economic co-benefits related to the socio-technical system of clean-energy innovation and the global clean-energy market.The following article, 'The EU system of multi-level climate governance', by Martin Jnicke and Rainer Quitzow provides an overview of the regional structure of the global climate governance system.The authors understand the EU as a system where 'multi-level reinforcement' has been observed several times and which can be considered as a leader by example in global climate governance.They point to the fact that the EU has the world's highest share of green electricity and since 1990 has made the largest reduction to its greenhouse gas emissions.They attribute the EU's relatively successful performance in climate and energy governance to two main factors: (1) multi-level reinforcement and (2) the mobilization of economic interests at different levels of governance through low-carbon industrial policy.While the multi-impulse system has fostered

This special issue on clean energy and environmental technologies aims at providing a forum for researchers who are working on relevant areas to exchange ideas driving innovation and report their latest research outcomes in developing clean energy and environmental technologies. A few years ago, Nobel Laureate Richard E. Smalley outlined Humanity’s Top Ten Problems for the next fifty years, in a talk given for the Enterprise Forum at Massachusetts Institute of Technology (MIT). Energy was listed as the first of the top ten problems and the environment as the fourth. Actually energy is the most basic requirement for economic development and people’s livelihoods while this requirement is constantly increasing, particularly in economically rapidly developing countries like China. Supply of energy still mainly relies on fossil fuels such as coal, petroleum, and natural gas around the world. However reserves for fossil fuels are limited and producing energy from these fossil fuels with existing technologies has caused serious environmental problems, e.g., increasing greenhouse gases emission which exacerbates global warming. Resolutions to these global problems lie in the innovative technologies to produce energy in a clean and environmentally friendly manner. Both developing renewable energy and using energy more efficiently are major components of clean energy and environmental technologies. Development of clean energy and environmental technologies has been thought of as two of the most active research fields today. This special issue includes 12 papers consisting of research and review articles selected from different research institutions in Australia, China and Indonesia. They contain a wide range of the hottest research topics in clean energy and environmental technologies, including development of the innovative catalysts used for clean energy and environmental processes, studies on hydrogen production and storage, CO2 capture and syngas clean technology as well as other research in energy efficiency, coal seam gas recovery and environmental economics. These research and/or review articles, which although do not cover the full scope of studies in energy and environment due to page limitations , can still provide readers with brief track references to facilitate the development of new clean energy and environmental technologies. This special issue was organized as per instructions of the Editors Dr. Fei Yuan, Prof. Yaodong Huang, and Prof. Yanni Li. We have received invaluable help from colleagues working with or having worked with clean energy and environmental research, especially Prof. Edward White, Prof. Duong Do, Dr. Greg Birkett and Dr. Fu-Yang Wang in School of Chemical Engineering, the University of Queensland. They provided careful peer-reviews on the selected papers with many useful comments and suggestions for authors to enhance the quality of the papers. It would be impossible to publish this special issue without the help of these peer-reviewers. Finally, as the Guest Editor, I would like to thank all the people—all the authors and co-authors and reviewers for their contributions to this special issue, and editors of the Frontiers of Chemical Science and Engineering for their scientific input and consistent support.

Discussions of tropical deforestation are currently at the forefront of climate change policy negotiations at national, regional, and international levels. This paper analyzes the effects of linking Reduced Emissions from Deforestation and Forest Degradation (REDD) to a global market for greenhouse gas emission reductions. We supplement a global climate-energy-economy model with alternative cost estimates for reducing deforestation emissions in order to examine a global program for stabilizing greenhouse gas concentrations at 550 ppmv of CO2 equivalent. Introducing REDD reduces global forestry emissions through 2050 by 20-22% in the Brazil-only case and by 64-88% in the global REDD scenario. At the same time, REDD lowers the total costs of the climate policy by an estimated 10-25% depending on which tropical countries participate and whether the A¢Â€ÂœbankingA¢Â€Â of excess credits for use in future periods is allowed. As a result, REDD could enable additional reductions of at least 20 ppmv of CO2-equivalent concentrations with no added costs compared to an energy-sector only policy. The cost savings from REDD are magnified if banking is allowed and there is a need to increase the stringency of global climate policy in the future in response, for example, to new scientific information. Results also indicate that REDD will decrease carbon prices in 2050 by 8-23% with banking and 11-26% without banking. While developing regions, particularly Latin America, gain the value of REDD opportunities, the decrease in the carbon price keeps the value of international carbon market flows relatively stable despite an increase in volumes transacted. We also estimate that REDD generally reduces the total portfolio of investments and research and development of new energy technologies by 1-10%. However, due to impacts on the relative prices of different fossil fuels, REDD has a slight positive estimated effect on investments in coal-related technologies (IGCC and CCS) as well as, in some cases, non-electric energy R&D. This research confirms that integrating REDD into global carbon markets can provide powerful incentives for the preservation of tropical forests while lowering the costs of global climate change protection and providing valuable policy flexibility.

The road map of fusion power is compared to the development and deployment of other energy technologies. A generic deployment model is presented, which describes the fastest deployment (of any new technology) achievable with the constraint that the industrial capacity that needs to be built up must be continuous and should not overshoot the replacement market in the final, saturated state. It is shown that the development needs an ‘investment’ phase to build up industrial capacity which takes several decades, during which growth is typically exponential, but net energy production is negligible. During the exponential growth the cost is dominated by the capital investment, which allows for a simple comparison of different energy technologies. Fusion is at the start of the exponential growth phase, while still having significant uncertainties concerning its technical feasibility. In comparison to e.g. solar PV and wind, fusion is ‘late’, lagging by some 50 years. To follow the same rate of development that fission, wind and PV have shown, fusion will need to have 3 DEMO reactors operational in the early 2050s, followed by 10 generation one (GEN1) plants in the early 2060s and 100 GEN2 plants in the early 2070s. For the cost development to be comparable, an estimated allowable cost for one DEMO reactor is ~20 G$. While these indicative numbers for the pace and cost of development are very challenging but perhaps not unthinkable for fusion, this analysis does point towards an emphasis on ‘simpler and cheaper’ reactor designs.

What effect does extreme weather have on climate policy? Existing studies show that weather shocks have negative economic impacts and increase public awareness of climate change. These findings help identify the impacts of climate change on economic and social systems, and provide reasons for governments to adopt climate policy reforms. However, questions remain about the overall link between local extreme weather shocks and government climate policy. I investigate the effect of temperature shocks and natural disasters on a range of national, international, and subnational climate policies in samples spanning 1990–2018. I find that neither temperature shocks nor natural disasters generate climate mitigation reforms. Given that climate policy is currently insufficient to manage climate change and climate impacts are expected to increase this century, these findings suggest that future climate shocks are unlikely to catalyze meaningful climate action.