Beyond Paris: Enabling a Global Clean Energy Transition

Transcription

1 Beyond Paris: Enabling a Global Clean Energy Transition Prof. Valerie J. Karplus MIT Energy Initiative External Advisory Board Meeting October 28, 2016 Source:

2 Our group s research spans multiple scales to study what works to incentivize transitions to clean energy Nations & regions: Designing policy and institutions. Co-benefits of climate policy Politically-viable climate policy Climate policy implementation in developing countries Energy systems: Incentivizing technology and behavior change. Coal flexibility, grid operations, & wind energy integration Low carbon strategies for expanding electricity access in India Corporations & startups: Strategy for a carbonconstrained world. Commercial potential for renewable energy business models in Africa Industrial energy efficiency in global supply chains 2

3 Our group s research spans multiple scales to study what works to incentivize transitions to clean energy Nations & regions: Designing policy and institutions. Co-benefits of climate policy Politically-viable climate policy Climate policy implementation in developing countries 3

4 China s Pledge in the 2015 Paris Climate Agreement Reach peak CO 2 emissions around 2030 and make best efforts to peak earlier. Increase the non-fossil fuel share of its energy use to around 20 percent by Reduce the CO 2 intensity (carbon emitted per unit of GDP) of its economy by 60 to 65% by 2030, relative to Increase its forest stock by around 4.5 billion cubic meters by 2030, relative to U.S.-China Climate Deal November

5 To assess the impact of climate policy in China we developed the Regional Emissions Air Quality Climate and Health (REACH) Framework Policy Scenarios 1 Energy-Economic Model China Regional Energy Model (C-REM) 2 Projected Emissions REAS emissions inventory Air Quality 4 Health Effects Uses latest estimates from Chinese sources 3 Atmos. Chemistry model GEOS-Chem Source: Karplus & Selin group collaborative research,

6 TODAY Annual CO 2 reduction under climate policy Change in air pollution 2030 Net co-benefits per year in billions %/yr US $42 4%/yr US $243 Net co-benefits of climate policy in China are large and increase with policy stringency. Source: Karplus & Selin group collaborative research, %/yr US $444 net co-benefits = AQ health benefits policy costs 6

7 Our group s research spans multiple scales to study what works to incentivize transitions to clean energy Nations & regions: Designing policy and institutions. Co-benefits of climate policy Politically-viable climate policy Climate policy implementation in developing countries Energy systems: Incentivizing technology and behavior change. Coal flexibility, grid operations, & wind energy integration Low carbon strategies for expanding electricity access in India 7

8 China s installed wind capacity reached 145 GW in 2015, exceeding the capacity of the European Union. Grid-connected wind installations in 2015 were 129 GW. Planned for 2030: GW Source: Davidson, Zhang, Xiong, Zhang, & Karplus,

9 Although capacity growth is impressive, wind makes only a modest contribution to total electricity generated WIND COAL China s energy system and its electricity mix are very coal heavy. Electricity demand has grown ~152% over the past decade. Source: Davidson, Zhang, Xiong, Zhang, & Karplus, Curtailment (spilled wind) has increased in recent years 20% in the first half of

10 Overview of grid-integrated wind potential calculation Capacity factor + Capital cost O&M cost Taxes Levelized cost model for a wind farm Cost of generation by grid cell Wind characterization from Modern Era Retrospective-Analysis for Research and Applications (MERRA) assembled using reanalysis techniques. Provides hourly data points from Exclusion map: Elevation data from NASA s Shuttle Radar Topography Mission Source: Davidson, Zhang, Xiong, Zhang, & Karplus, Operational model of power system & transmission 10

11 Coal flexibility has large impact on 2030 wind potential High: Equivalent to 75% of China s nonfossil energy target Key finding: Reforms that relax must-run quotas for coal generators and move to real-time pricing will enable large-scale, cost-effective carbon reduction in China. Source: Davidson, Zhang, Xiong, Zhang, & Karplus,

12 Our group s research spans multiple scales to study what works to incentivize transitions to clean energy Nations & regions: Designing policy and institutions. Co-benefits of climate policy Politically-viable climate policy Climate policy implementation in developing countries Energy systems: Incentivizing technology and behavior change. Coal flexibility, grid operations, & wind energy integration Low carbon strategies for expanding electricity access in India Corporations & startups: Strategy for a carbonconstrained world. Commercial potential for renewable energy business models in Africa Industrial energy efficiency in global supply chains 12

13 Assessing commercial potential for clean energy Cases: Angola, Egypt, Ghana, Mozambique, South Africa Global and national contexts & policies Energy sector institutions & policies Business models strategy & organization Rule of law Rights protection New market entry barriers Location of lead users Policy and contract certainty Market size Long-term technology plans Understand emerging models Connect to existing capabilities No-regret decisions Partnership opportunities Source: Karplus, Lessard, Rajpurkar,

14 Key Questions What climate policies are both cost-effective and politically feasible today? Do co-benefits strengthen the case for policy? What institutions and reforms in the economy and energy sector will enable policies to work? How do companies and innovators respond to policy? What strategies will enable companies to evolve and compete in a low carbon world? 14

15 Outreach and Impact Annual Stakeholders Meetings

16 Thank you! Valerie J. Karplus