IDEAS home Printed from https://ideas.repec.org/a/eee/tefoso/v90y2015ipap220-229.html
   My bibliography  Save this article

Impact of fragmented emission reduction regimes on the energy market and on CO2 emissions related to land use: A case study with China and the European Union as first movers

Author

Listed:
  • Otto, Sander A.C.
  • Gernaat, David E.H.J.
  • Isaac, Morna
  • Lucas, Paul L.
  • van Sluisveld, Mariësse A.E.
  • van den Berg, Maarten
  • van Vliet, Jasper
  • van Vuuren, Detlef P.

Abstract

In recent years, an approach based on voluntary pledges by individual regions has attracted interest of policy-makers and consequently also climate policy research. In this paper, we analyze scenarios in which the EU and China act as early-movers in international climate policy. Such a situation risks leakage between regions with ambitious emission reduction targets and those with less ambitious targets via fossil-fuel markets, displacement of heavy industry and land-use consequences. We examine some of these factors using the IMAGE model. While IMAGE does not include all mechanisms, we find the leakage rate to be relatively small, about 5% of the emission reductions in the EU and China. The far majority occurs via the energy market channel and the remainder through land-use change. Reduced oil prices due to less depletion forms the key reason for this leakage impact.

Suggested Citation

  • Otto, Sander A.C. & Gernaat, David E.H.J. & Isaac, Morna & Lucas, Paul L. & van Sluisveld, Mariësse A.E. & van den Berg, Maarten & van Vliet, Jasper & van Vuuren, Detlef P., 2015. "Impact of fragmented emission reduction regimes on the energy market and on CO2 emissions related to land use: A case study with China and the European Union as first movers," Technological Forecasting and Social Change, Elsevier, vol. 90(PA), pages 220-229.
    • Handle: RePEc:eee:tefoso:v:90:y:2015:i:pa:p:220-229
    DOI: 10.1016/j.techfore.2014.01.015
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0040162514000523
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.techfore.2014.01.015?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Boeters, Stefan & Bollen, Johannes, 2012. "Fossil fuel supply, leakage and the effectiveness of border measures in climate policy," Energy Economics, Elsevier, vol. 34(S2), pages 181-189.
    2. Bauer, Nico & Bosetti, Valentina & Hamdi-Cherif, Meriem & Kitous, Alban & McCollum, David & Méjean, Aurélie & Rao, Shilpa & Turton, Hal & Paroussos, Leonidas & Ashina, Shuichi & Calvin, Katherine & Wa, 2015. "CO2 emission mitigation and fossil fuel markets: Dynamic and international aspects of climate policies," Technological Forecasting and Social Change, Elsevier, vol. 90(PA), pages 243-256.
    3. Henry D. Jacoby & Richard S. Eckaus & Denny A. Ellerman & Ronald G. Prinn & David M. Reiner & Zili Yang, 1997. "CO2 Emissions Limits: Economic Adjustments and the Distribution of Burdens," The Energy Journal, , vol. 18(3), pages 31-58, July.
    4. Kriegler, Elmar & Riahi, Keywan & Bauer, Nico & Schwanitz, Valeria Jana & Petermann, Nils & Bosetti, Valentina & Marcucci, Adriana & Otto, Sander & Paroussos, Leonidas & Rao, Shilpa & Arroyo Currás, T, 2015. "Making or breaking climate targets: The AMPERE study on staged accession scenarios for climate policy," Technological Forecasting and Social Change, Elsevier, vol. 90(PA), pages 24-44.
    5. Brian C. Murray & Bruce A. McCarl & Heng-Chi Lee, 2004. "Estimating Leakage from Forest Carbon Sequestration Programs," Land Economics, University of Wisconsin Press, vol. 80(1), pages 109-124.
    6. Boehringer Christoph & Fischer Carolyn & Rosendahl Knut Einar, 2010. "The Global Effects of Subglobal Climate Policies," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 10(2), pages 1-35, December.
    7. Andries Hof & Michel Elzen & Detlef Vuuren, 2009. "Environmental effectiveness and economic consequences of fragmented versus universal regimes: what can we learn from model studies?," International Environmental Agreements: Politics, Law and Economics, Springer, vol. 9(1), pages 39-62, February.
    8. Bert Metz & Marcel Berk & Michel den Elzen & Bert de Vries & Detlef van Vuuren, 2002. "Towards an equitable global climate change regime: compatibility with Article 2 of the Climate Change Convention and the link with sustainable development," Climate Policy, Taylor & Francis Journals, vol. 2(2-3), pages 211-230, September.
    9. Shilpa Rao, Ilkka Keppo and Keywan Riahi, 2006. "Importance of Technological Change and Spillovers in Long-Term Climate Policy," The Energy Journal, International Association for Energy Economics, vol. 0(Special I), pages 123-140.
    10. Babiker, Mustafa H., 2005. "Climate change policy, market structure, and carbon leakage," Journal of International Economics, Elsevier, vol. 65(2), pages 421-445, March.
    11. Nico Bauer & Valentina Bosetti & Meriem Hamdi-Cherif & Alban Kitous & David L Mccollum & Aurélie Méjean & Shilpa Rao & Hal Turton & Leonidas Paroussos & Shuichi Ashina & Katherine Calvin & Kenichi Wad, 2015. "CO2 emission mitigation and fossil fuel markets: Dynamic and international aspects of climate policies," Post-Print hal-01086076, HAL.
    12. Searchinger, Timothy & Heimlich, Ralph & Houghton, R. A. & Dong, Fengxia & Elobeid, Amani & Fabiosa, Jacinto F. & Tokgoz, Simla & Hayes, Dermot J. & Yu, Hun-Hsiang, 2008. "Use of U.S. Croplands for Biofuels Increases Greenhouse Gases Through Emissions from Land-Use Change," Staff General Research Papers Archive 12881, Iowa State University, Department of Economics.
    13. Popp, Alexander & Krause, Michael & Dietrich, Jan Philipp & Lotze-Campen, Hermann & Leimbach, Marian & Beringer, Tim & Bauer, Nico, 2012. "Additional CO2 emissions from land use change — Forest conservation as a precondition for sustainable production of second generation bioenergy," Ecological Economics, Elsevier, vol. 74(C), pages 64-70.
    14. Christian Azar, 2005. "Post-Kyoto climate policy targets: costs and competitiveness implications," Climate Policy, Taylor & Francis Journals, vol. 5(3), pages 309-328, May.
    15. Havlík, Petr & Schneider, Uwe A. & Schmid, Erwin & Böttcher, Hannes & Fritz, Steffen & Skalský, Rastislav & Aoki, Kentaro & Cara, Stéphane De & Kindermann, Georg & Kraxner, Florian & Leduc, Sylvain & , 2011. "Global land-use implications of first and second generation biofuel targets," Energy Policy, Elsevier, vol. 39(10), pages 5690-5702, October.
    16. Bertram, Christoph & Johnson, Nils & Luderer, Gunnar & Riahi, Keywan & Isaac, Morna & Eom, Jiyong, 2015. "Carbon lock-in through capital stock inertia associated with weak near-term climate policies," Technological Forecasting and Social Change, Elsevier, vol. 90(PA), pages 62-72.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Capellán-Pérez, Iñigo & de Castro, Carlos & Arto, Iñaki, 2017. "Assessing vulnerabilities and limits in the transition to renewable energies: Land requirements under 100% solar energy scenarios," Renewable and Sustainable Energy Reviews, Elsevier, vol. 77(C), pages 760-782.
    2. Leslie S. Abrahams & Constantine Samaras & W. Michael Griffin & H. Scott Matthews, 2017. "Effect of crude oil carbon accounting decisions on meeting global climate budgets," Environment Systems and Decisions, Springer, vol. 37(3), pages 261-275, September.
    3. Mikel González-Eguino & Iñigo Capellán-Pérez & Iñaki Arto & Alberto Ansuategi & Anil Markandya, 2017. "Industrial and terrestrial carbon leakage under climate policy fragmentation," Climate Policy, Taylor & Francis Journals, vol. 17(0), pages 148-169, June.
    4. Vassilis Daioglou & Matteo Muratori & Patrick Lamers & Shinichiro Fujimori & Alban Kitous & Alexandre C. Köberle & Nico Bauer & Martin Junginger & Etsushi Kato & Florian Leblanc & Silvana Mima & Marsh, 2020. "Implications of climate change mitigation strategies on international bioenergy trade," Climatic Change, Springer, vol. 163(3), pages 1639-1658, December.
    5. Wu, Si & Hu, Shougeng & Frazier, Amy E., 2021. "Spatiotemporal variation and driving factors of carbon emissions in three industrial land spaces in China from 1997 to 2016," Technological Forecasting and Social Change, Elsevier, vol. 169(C).
    6. Chen, Xianwen & Alfnes , Frode & Rickertsen , Kyrre, 2015. "Labeling Farmed Seafood," Working Paper Series 10-2015, Norwegian University of Life Sciences, School of Economics and Business.
    7. Panzone, Luca A. & Lemke, Fred & Petersen, Henry L., 2016. "Biases in consumers' assessment of environmental damage in food chains and how investments in reputation can help," Technological Forecasting and Social Change, Elsevier, vol. 111(C), pages 327-337.
    8. Wei-Hua Qu & Ling Xu & Guo-Hua Qu & Zhi-Jun Yan & Jian-Xiu Wang, 2017. "The impact of energy consumption on environment and public health in China," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 87(2), pages 675-697, June.
    9. Kriegler, Elmar & Riahi, Keywan & Bauer, Nico & Schwanitz, Valeria Jana & Petermann, Nils & Bosetti, Valentina & Marcucci, Adriana & Otto, Sander & Paroussos, Leonidas & Rao, Shilpa & Arroyo Currás, T, 2015. "Making or breaking climate targets: The AMPERE study on staged accession scenarios for climate policy," Technological Forecasting and Social Change, Elsevier, vol. 90(PA), pages 24-44.
    10. Chang, Kai & Chen, Rongda & Chevallier, Julien, 2018. "Market fragmentation, liquidity measures and improvement perspectives from China's emissions trading scheme pilots," Energy Economics, Elsevier, vol. 75(C), pages 249-260.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Paroussos, Leonidas & Fragkos, Panagiotis & Capros, Pantelis & Fragkiadakis, Kostas, 2015. "Assessment of carbon leakage through the industry channel: The EU perspective," Technological Forecasting and Social Change, Elsevier, vol. 90(PA), pages 204-219.
    2. Arroyo-Currás, Tabaré & Bauer, Nico & Kriegler, Elmar & Schwanitz, Valeria Jana & Luderer, Gunnar & Aboumahboub, Tino & Giannousakis, Anastasis & Hilaire, Jérôme, 2015. "Carbon leakage in a fragmented climate regime: The dynamic response of global energy markets," Technological Forecasting and Social Change, Elsevier, vol. 90(PA), pages 192-203.
    3. Tan, Xiujie & Liu, Yu & Cui, Jingbo & Su, Bin, 2018. "Assessment of carbon leakage by channels: An approach combining CGE model and decomposition analysis," Energy Economics, Elsevier, vol. 74(C), pages 535-545.
    4. Michael Jakob & Jan Christoph Steckel & Ottmar Edenhofer, 2014. "Consumption- Versus Production-Based Emission Policies," Annual Review of Resource Economics, Annual Reviews, vol. 6(1), pages 297-318, October.
    5. Onno Kuik, 2014. "REDD+ and international leakage via food and timber markets: a CGE analysis," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 19(6), pages 641-655, August.
    6. Zhu, Lin & Cunningham, Scott W., 2022. "Unveiling the knowledge structure of technological forecasting and social change (1969–2020) through an NMF-based hierarchical topic model," Technological Forecasting and Social Change, Elsevier, vol. 174(C).
    7. Adrian Amelung, 2016. "Das "Paris-Agreement": Durchbruch der Top-Down-Klimaschutzverhandlungen im Kreise der Vereinten Nationen," Otto-Wolff-Institut Discussion Paper Series 03/2016, Otto-Wolff-Institut für Wirtschaftsordnung, Köln, Deutschland.
    8. Brigitte Knopf, Ottmar Edenhofer, Christian Flachsland, Marcel T. J. Kok, Hermann Lotze-Campen, Gunnar Luderer, Alexander Popp, Detlef P. van Vuuren, 2010. "Managing the Low-Carbon Transition - From Model Results to Policies," The Energy Journal, International Association for Energy Economics, vol. 0(Special I).
    9. Bilgili, Faik & Koçak, Emrah & Bulut, Ümit & Kuşkaya, Sevda, 2017. "Can biomass energy be an efficient policy tool for sustainable development?," Renewable and Sustainable Energy Reviews, Elsevier, vol. 71(C), pages 830-845.
    10. Bollen, Johannes, 2015. "The value of air pollution co-benefits of climate policies: Analysis with a global sector-trade CGE model called WorldScan," Technological Forecasting and Social Change, Elsevier, vol. 90(PA), pages 178-191.
    11. Marshall A. Wise, Haewon C. McJeon, Katherine V. Calvin, Leon E. Clarke, and Page Kyle, 2014. "Assessing the Interactions among U.S. Climate Policy, Biomass Energy, and Agricultural Trade," The Energy Journal, International Association for Energy Economics, vol. 0(Special I).
    12. Pan, Wenqi & Kim, Man-Keun & Ning, Zhuo & Yang, Hongqiang, 2020. "Carbon leakage in energy/forest sectors and climate policy implications using meta-analysis," Forest Policy and Economics, Elsevier, vol. 115(C).
    13. Bento, Antonio M. & Klotz, Richard & Landry, Joel R., 2011. "Are there Carbon Savings from US Biofuel Policies? Accounting for Leakage in Land and Fuel Markets," 2011 Annual Meeting, July 24-26, 2011, Pittsburgh, Pennsylvania 104008, Agricultural and Applied Economics Association.
    14. Shimbar, A., 2021. "Environment-related stranded assets: An agenda for research into value destruction within carbon-intensive sectors in response to environmental concerns," Renewable and Sustainable Energy Reviews, Elsevier, vol. 144(C).
    15. van der Ploeg, Frederick & Rezai, Armon, 2020. "The risk of policy tipping and stranded carbon assets," Journal of Environmental Economics and Management, Elsevier, vol. 100(C).
    16. Marcucci, Adriana & Fragkos, Panagiotis, 2015. "Drivers of regional decarbonization through 2100: A multi-model decomposition analysis," Energy Economics, Elsevier, vol. 51(C), pages 111-124.
    17. Attahiru, Yusuf Babangida & Aziz, Md. Maniruzzaman A. & Kassim, Khairul Anuar & Shahid, Shamsuddin & Wan Abu Bakar, Wan Azelee & NSashruddin, Thanwa Filza & Rahman, Farahiyah Abdul & Ahamed, Mohd Imra, 2019. "A review on green economy and development of green roads and highways using carbon neutral materials," Renewable and Sustainable Energy Reviews, Elsevier, vol. 101(C), pages 600-613.
    18. Reijnders, L., 2009. "Are forestation, bio-char and landfilled biomass adequate offsets for the climate effects of burning fossil fuels?," Energy Policy, Elsevier, vol. 37(8), pages 2839-2841, August.
    19. repec:old:wpaper:340 is not listed on IDEAS
    20. Olga Kiuila & Krzysztof Wójtowicz & Tomasz Żylicz & Leszek Kasek, 2016. "Economic and environmental effects of unilateral climate actions," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 21(2), pages 263-278, February.
    21. Diermeier, Matthias & Schmidt, Torsten, 2014. "Oil price effects on land use competition: an empirical analysis," Agricultural Economics Review, Greek Association of Agricultural Economists, vol. 15(1), pages 1-17.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:tefoso:v:90:y:2015:i:pa:p:220-229. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.sciencedirect.com/science/journal/00401625 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.