Costs and Benefits of Emissions Mitigation and the Value of Technology for Stabilizing Climate Change

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1 Costs and Benefits of Emissions Mitigation and the Value of Technology for Stabilizing Climate Change Nebojša a Nakićenovi enović International Institute for Applied Systems Analysis xx Technische Universität t Wien xx naki@iiasa.ac.at IIASA-RITE International Symposium Global warming and sustainable development,, Keidanren-Kaikan, Kaikan, Tokyo 18 March 2008

2 Nakicenovic # Global Energy Challenges Sustainable access to energy and food (a prerequisite for reaching MDGs) Energy and ecosystems services Security and reliability of systems Deep CO 2 and GHG reductions Investment in R&D and deployment Policy frameworks and life-styles

3 Nakicenovic # Add as many mail coaches as you please, you will never get a railroad by so doing Joseph A. Schumpeter New energy systems will not emerge by simply adding new and emerging technologies to the current ones. A new paradigm is needed with convergence of innovative technologies, institutional structures, policy frameworks and human behavior.

4 Global Population Transitions Industrial A.D. p 10 8 Agricultural Tool Making 5000 B.C Source: R. Kates (1997) after E. Deevey (1960) Years Before Present Nakicenovic Source: Kates & Deevey #

5 Energy Services and Sources Through Time Letter Horse Hay Agriculture Sunlight Telegraph Interntet, Mobile Phone Electricity Electricity Convergence Steam Locomotive ICE Automobile 1770s Energy, Mobility Information Coal Coal mine Coal fields 1870s Gasoline Oil refinery Crude oil 1970s Electricity Hydrogen 2070s SMR, decarbonization Electrolysis Natural gas / fossils Biomass Sunlight Wind Uranium Source: Nakicenovic David Sanborn Scott, 2004 #5 2007

6 Warmest 12 years: Global Mean Temperatures are Rising 1998,2005,2003,2002,2004,2006, 2001,1997,1995,1999,1990,2000 Period Rate ± ±0.018 Years /decade INTERGOVERNMENTAL PANEL ON CLIMATE CHNGE (IPCC)

7 Observed Climate Change Warming of the climate system is unequivocal 100-yr warming trend ( ) of 0.74 o C. Increased since TAR. Sea level rise: : 1.8 mm per yr : 3.1 mm per yr Decreasing: snow and ice extent Arctic sea ice extent Mountain glaciers IPCC

8 Urbanization 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Nakicenovic Source: Grübler, 2007 #8 2008

9 Education 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Nakicenovic Source: Lutz, 2007 #9 2008

10 Democratization 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Nakicenovic Source: Modelski, 2002 #

11 Nakicenovic # Food for a Week, Darfur Refugees, Chad 2007 PETER MENZEL PHOTOGRAPHY

12 Nakicenovic # Food for a Week, Germany 2005 PETER MENZEL PHOTOGRAPHY

13 The Natomo Family 6:30am March 27, 1993 Kouakourou, Mali Nakicenovic 2005 PETER MENZEL PHOTOGRAPHY #

14 Nakicenovic Source: After SRES, 2000 # Night Lights 2000

15 Nakicenovic Source: After SRES, 2000 # Night Lights IIASA A2r Scenario SRES A2 2070

16 Nakicenovic Source: TAR-WGI, 2001 # Δ Temperature 2070

17 s Global Mean Temperature Change Six illustrative SRES scenarios, full range Baseline Uncertainty: 50% climate sensitivity 25% population & GDP 25% technology Uncertainty on extent and success of climate policies INTERGOVERNMENTAL PANEL ON CLIMATE CHANGE (IPCC)

18 Global Primary Energy A2r EJ Renewables Nuclear Gas Oil Coal Nakicenovic #

19 Global Primary Energy B1 EJ Renewables Nuclear Gas Oil Coal Nakicenovic #

20 Surface Temperature Change AOGCM projections for illustrative SRES scenarios INTERGOVERNMENTAL PANEL ON CLIMATE CHNGE (IPCC)

21 Long-Term Stabilization Profiles A2 B1 ~$100/tCO 2 INTERGOVERNMENTAL PANEL ON CLIMATE CHNGE (IPCC)

22 Long-Term Stabilization Profiles ~$100/tCO 2 INTERGOVERNMENTAL PANEL ON CLIMATE CHNGE (IPCC)

23 Long-Term Stabilization Profiles <$25/tCO 2 ~$100/tCO 2 INTERGOVERNMENTAL PANEL ON CLIMATE CHNGE (IPCC)

24 The lower the stabilisation level the earlier global emissions have to go down peak in 10yrs peak in 25yrs INTERGOVERNMENTAL PANEL ON CLIMATE CHNGE (IPCC)

25 Nakicenovic # Technology Learning Costs and Benefits Specific investment costs ($/kw) Learning costs Cumulative investments $ Cumulative MW experience Time Level of present competitiveness Future Learning learning benefits benefits

26 Nakicenovic Grübler, 2002 # PV costs (1985) Yen per W PV costs (1985) Yen per W Japan - PV Costs vs. Expenditures 100, ,000 10,000 10,000 1,000 1, : 30, : 30,000 Basic Basic R&D R&D Data source: Watanabe, 1995 & : 1976: 16,300 16,300 Applied R&D 1980: 4, x y=10 R 2 = Cost reduction ~ $ : 1,200 Investment 1995: Data Source: Watanabe, 1997 ~ $ , ,000 Cumulative expenditures, billion (1985) Yen Cumulative expenditures, billion (1985) Yen

27 Nakicenovic Source: Riahi # Technology Learning in SRES 10,000 Investment Costs per kw in US$90 1, ,000 10,000 Cumulative Installed Capacity [GW] 100,000

28 Total Energy-related Investments (World, short & long-term) Long-term Investment Savings (~40 trillion) Trillion US$ Upfront Investments (~2 trillion) 25 0 A2 B1 A2 B Nakicenovic #

29 Emissions and Costs Cumulative Emissions (GtCeq.) Emissions Costs A2r B Cumulative System Costs (trillion$) CO2-equivalent concentration in 2100, ppmv

30 Development public R&D 270 expenditure (in OECD) in billion $ Total R&D (left axis) Energy R&D (right axis) Source: Doornbosch,,

31 Development private R&D expenditure (in OECD) In million $ Oil and nuclear Utilities Total energy Source: Doornbosch,,

32 Global Mitigation Challenges Significant mitigation potential by 2030 and beyond at costs <$100/tCO 2 Technological change essential for reducing mitigation costs and increasing potentials Upfront investments reduce longer-term mitigation costs and increase potentials Investment in RD&D and diffusion reduce mitigation costs INTERGOVERNMENTAL PANEL ON CLIMATE CHNGE (IPCC)

33 Nakicenovic # Towards a more Sustainable Future The magnitude of the change required is huge The challenge is to find a way forward that addresses all the issues simultaneously A paradigm shift is needed: energy end- use efficiency, new renewables, advanced nuclear and carbon capture and storage.

34 Confronting the Challenges of Energy for Sustainable Development: The Role of Scientific and Technical Analysis IIASA International Institute for Applied Systems Analysis and its international partners present GlobalEnergyAssessment.org