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Modeling the Impacts of Climate Change on the Energy Sector: a Swiss perspective

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  • Gonseth, Camille
  • Vielle, Marc

Abstract

When speaking of energy in the context of climate change, the interest usually lies in mitigation policies. This paper takes a different approach and analyzes the impacts of climate change on the Swiss energy system. We study these impacts on both the energy demand and supply. For the former impacts, it is predicted that higher temperatures will modify future heating and cooling demands in opposite directions. As for the supply side, changes in precipitation will affect hydropower while higher temperature will impact cooling facilities and energy efficiency of thermal power plants. To undertake the analysis, we use a Computable General Equilibrium model, the GEMINI-E3, which is a standard CGE model based on the GTAP database. In the first part of the paper, we present how to integrate within GEMINI-E3 information related to temperature and precipitation. Future changes in these variables are obtained from 4 couplings of global and regional climate models realized in the framework of the European project ENSEMBLES. Based on these simulation data, we derived impacts via econometrically estimated functions and constructed aggregated indicators, such as cooling and heating degree-days, that are then used as exogenous variables within GEMINI-E3. After the methodological part, we present different scenarios without and with climate change and compare their outcomes by 2050. Whereas detrimental impacts on the supply side seem to remain limited, we clearly find strong macroeconomic impacts through changes in heating and cooling energy demands. Furthermore, we show that the reduced energy demand for heating has positive impacts for the Swiss economy that largely outweigh the negative ones created by the increased energy demand for cooling. These results are linked to the Swiss context, where heating needs are much higher than cooling needs. The net impact is all the more positive that fossil fuels, which are the main energy source for heating, are entirely imported.

Suggested Citation

  • Gonseth, Camille & Vielle, Marc, 2012. "Modeling the Impacts of Climate Change on the Energy Sector: a Swiss perspective," Conference papers 332204, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    • Handle: RePEc:ags:pugtwp:332204
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    1. van Vuuren, Detlef P. & Weyant, John & de la Chesnaye, Francisco, 2006. "Multi-gas scenarios to stabilize radiative forcing," Energy Economics, Elsevier, vol. 28(1), pages 102-120, January.
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