IDEAS home Printed from https://ideas.repec.org/p/ags/pugtwp/333179.html
   My bibliography  Save this paper

Challenges and Opportunities Economy-Wide Decarbonization Pathways in California

Author

Listed:
  • Yuan, Mei
  • Tapia-Ahumada, Karen
  • Paltsev, Sergey

Abstract

Aiming to achieve a deep decarbonization target by mid-century, California has made continuous efforts in developing a portfolio of policy strategy that combines economy-wide targets with sector-specific requirements, and technology-specific mandates. The economy-wide emissions targets focus on the mid-term (2030) and mid-century (2050) goals thus provide flexibility in clean energy technology development pathways. The extent of the flexibility, however, is constrained by the complementary measures proposed to develop low-carbon solutions in certain sectors. Therefore, it is critical to evaluate different mitigation strategies to improve the understanding of challenges and opportunities for California. To capture the technology details while examining the economy-wide policy impact, we employ an integrated top-down bottom-up modeling framework (USREP-EleMod) that combines a recursive dynamic multi-sector computable general equilibrium model with an hourly dispatch and capacity expansion electricity model. Ongoing results show a substantial carbon price increase over the years as a consequence of the stringent economy-wide GHG emissions reductions of 40% by 2030 and 80% by 2050. By 2030, the expected price is close to $220 per tCO2 and rises above $400 per tCO2 by the end of the time horizon. Because of this, renewable natural gas (RNG) starts to become competitive against natural gas (NG), and gradually grows to meet carbon-free fuel demand from different sectors in particular the industrial sector. By 2050, total NG consumption falls by 2.8 Quads whereas total RNG increases by 1 Quad. In the electricity sector, we observe that the generation mix heavily relies on solar and wind resources to meet the carbon-free target by 2045. However, we also note that the electricity sector increases the use of RNG and CCS technologies as a substitute for conventional NG Combined Cycles and Combustion Turbines.

Suggested Citation

  • Yuan, Mei & Tapia-Ahumada, Karen & Paltsev, Sergey, 2020. "Challenges and Opportunities Economy-Wide Decarbonization Pathways in California," Conference papers 333179, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
  • Handle: RePEc:ags:pugtwp:333179
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/333179/files/9751.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Böhringer, Christoph & Rutherford, Thomos F., 2009. "Integrated assessment of energy policies: Decomposing top-down and bottom-up," Journal of Economic Dynamics and Control, Elsevier, vol. 33(9), pages 1648-1661, September.
    2. Tapia-Ahumada, Karen & Octaviano, Claudia & Rausch, Sebastian & Pérez-Arriaga, Ignacio, 2015. "Modeling intermittent renewable electricity technologies in general equilibrium models," Economic Modelling, Elsevier, vol. 51(C), pages 242-262.
    Full references (including those not matched with items on IDEAS)

    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. Kat, Bora, 2023. "Clean energy transition in the Turkish power sector: A techno-economic analysis with a high-resolution power expansion model," Utilities Policy, Elsevier, vol. 82(C).
    2. Andersen, Kristoffer S. & Termansen, Lars B. & Gargiulo, Maurizio & Ó Gallachóirc, Brian P., 2019. "Bridging the gap using energy services: Demonstrating a novel framework for soft linking top-down and bottom-up models," Energy, Elsevier, vol. 169(C), pages 277-293.
    3. Taran Faehn & Gabriel Bachner & Robert Beach & Jean Chateau & Shinichiro Fujimori & Madanmohan Ghosh & Meriem Hamdi-Cherif & Elisa Lanzi & Sergey Paltsev & Toon Vandyck & Bruno Cunha & Rafael Garaffa , 2020. "Capturing Key Energy and Emission Trends in CGE models: Assessment of Status and Remaining Challenges," Journal of Global Economic Analysis, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University, vol. 5(1), pages 196-272, June.
    4. Kat, B. & Şahin, Ü. & Teimourzadeh, S. & Tör, O.B. & Voyvoda, E. & Yeldan, A.E., 2024. "A new energy-economy-environment modeling framework: Insights from decarbonization of the Turkish power Sector towards net-zero Emission targets," Energy, Elsevier, vol. 302(C).
    5. Yuan, Mei & Tapia-Ahumada, Karen & Reilly, John, 2021. "The role of cross-border electricity trade in transition to a low-carbon economy in the Northeastern U.S," Energy Policy, Elsevier, vol. 154(C).
    6. Avraam, Charalampos & Bistline, John E.T. & Brown, Maxwell & Vaillancourt, Kathleen & Siddiqui, Sauleh, 2021. "North American natural gas market and infrastructure developments under different mechanisms of renewable policy coordination," Energy Policy, Elsevier, vol. 148(PB).
    7. Scott Kelly, 2011. "Do homes that are more energy efficient consume less energy?: A structural equation model for England's residential sector," Working Papers EPRG 1117, Energy Policy Research Group, Cambridge Judge Business School, University of Cambridge.
    8. Martin T. Ross, Patrick T. Sullivan, Allen A. Fawcett, and Brooks M. Depro, 2014. "Investigating Technology Options for Climate Policies: Differentiated Roles in ADAGE," The Energy Journal, International Association for Energy Economics, vol. 0(Special I).
    9. Farrokhifar, Meisam & Nie, Yinghui & Pozo, David, 2020. "Energy systems planning: A survey on models for integrated power and natural gas networks coordination," Applied Energy, Elsevier, vol. 262(C).
    10. Franck Lecocq & Alain Nadaï & Christophe Cassen, 2022. "Getting models and modellers to inform deep decarbonization strategies," Climate Policy, Taylor & Francis Journals, vol. 22(6), pages 695-710, July.
    11. Chunhong Sheng & Yun Cao & Bing Xue, 2018. "Residential Energy Sustainability in China and Germany: The Impact of National Energy Policy System," Sustainability, MDPI, vol. 10(12), pages 1-18, December.
    12. Luo, Xiaohu & Caron, Justin & Karplus, Valerie J. & Zhang, Da & Zhang, Xiliang, 2016. "Interprovincial migration and the stringency of energy policy in China," Energy Economics, Elsevier, vol. 58(C), pages 164-173.
    13. Ruth Delzeit & Robert Beach & Ruben Bibas & Wolfgang Britz & Jean Chateau & Florian Freund & Julien Lefevre & Franziska Schuenemann & Timothy Sulser & Hugo Valin & Bas van Ruijven & Matthias Weitzel &, 2020. "Linking Global CGE Models with Sectoral Models to Generate Baseline Scenarios: Approaches, Challenges, and Opportunities," Journal of Global Economic Analysis, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University, vol. 5(1), pages 162-195, June.
    14. Chang, Miguel & Lund, Henrik & Thellufsen, Jakob Zinck & Østergaard, Poul Alberg, 2023. "Perspectives on purpose-driven coupling of energy system models," Energy, Elsevier, vol. 265(C).
    15. Huppmann, Daniel & Egging, Ruud, 2014. "Market power, fuel substitution and infrastructure – A large-scale equilibrium model of global energy markets," Energy, Elsevier, vol. 75(C), pages 483-500.
    16. Jared C. Carbone & Linda T.M. Bui & Don Fullerton & Sergey Paltsev & Ian Sue Wing, 2022. "When and How to Use Economy-Wide Models for Environmental Policy Analysis," Annual Review of Resource Economics, Annual Reviews, vol. 14(1), pages 447-465, October.
    17. Tapia-Ahumada, Karen & Octaviano, Claudia & Rausch, Sebastian & Pérez-Arriaga, Ignacio, 2015. "Modeling intermittent renewable electricity technologies in general equilibrium models," Economic Modelling, Elsevier, vol. 51(C), pages 242-262.
    18. Feng, Y.Y. & Chen, S.Q. & Zhang, L.X., 2013. "System dynamics modeling for urban energy consumption and CO2 emissions: A case study of Beijing, China," Ecological Modelling, Elsevier, vol. 252(C), pages 44-52.
    19. Huang, Ying & Liao, Cuiping & Zhang, Jingjing & Guo, Hongxu & Zhou, Nan & Zhao, Daiqing, 2019. "Exploring potential pathways towards urban greenhouse gas peaks: A case study of Guangzhou, China," Applied Energy, Elsevier, vol. 251(C), pages 1-1.
    20. Chyong, Chi Kong & Newbery, David, 2022. "A unit commitment and economic dispatch model of the GB electricity market – Formulation and application to hydro pumped storage," Energy Policy, Elsevier, vol. 170(C).

    More about this item

    Keywords

    Resource /Energy Economics and Policy;

    Statistics

    Access and download statistics

    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:ags:pugtwp:333179. 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: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/gtpurus.html .

    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.