World Simulations with GEM-E3

Size: px
Start display at page:

Download "World Simulations with GEM-E3"

Transcription

1 World Simulations with 1 Introduction The implementation of the Kyoto protocol would imply the emissions of Annex B countries to be collectively reduced by 5% in relatively to their 1990 level, whereas no emission limits are implied for developing (non-annex-b) countries. In addition, the Annex B countries have to meet individual emission targets for relatively to their 1990 emissions. The Kyoto protocol allows for flexibility in reducing emissions. The countries could meet their targets not only through emission reduction measures within their territory but also through emission reduction in other countries. To do so the Kyoto protocol envisages three types of flexibility instruments: Trading of emission permits between the Annex B countries Joint Implementation projects in Annex B countries Clean Development mechanisms involving projects with partners in Annex B and in non-annex B countries. In addition, the Kyoto protocol has set the above targets for the basket of greenhouse gases without setting individual targets by gas type. Among these greenhouse gases, carbon dioxide from fossil energy combustion represents about 80% of total greenhouse gas emissions. Table 1 : Summary of Annex B targets under the Kyoto Protocol Target GHG Emission Index for relatively to 1990 (=100) for OECD or to 1995 (=100) for Eastern European and Former Soviet Union countries Australia 108 European Union 92 Switzerland 92 Norway 101 Iceland 110 Eastern European countries Former Soviet Union (Russia and Ukraine) 92 to 94 (roughly) 100 (roughly) Canada 94 USA 93 Japan 94 Page 1

2 The analysis with the current GEME3 World model aimed at evaluating the importance of emission trading as a means of reducing the overall costs for complying with the Kyoto protocol. The objective was also, and probably primarily, to test the current model structure and evaluate the model properties in stylised cases for which analysis with CGE models has been already published in the bibliography. Serving for model testing purposes, the exercise as presented here must be considered as very preliminary and has not the ambition to address the Kyoto implementation policy issues. The scenarios analysed with GEME3 World are hypothetical cases of CO2 emission trading and the results should not be used, at this stage, for policy analysis. 2 Design of Scenarios The current version of the GEME3 World model does not represent greenhouse gases other than carbon dioxide related to fossil energy combustion. So the analysis is limited to energyrelated CO2, which however represents the bulk of greenhouse gas emission and has systemwide effects through energy. The analysis starts from a baseline scenario for the world economy constructed with the model (see previous section). In this scenario there are no emission constraints. The policy scenarios involve reduction constraints on emission of carbon dioxide imposed at an annual basis, starting from 2000 and increasing gradually so as to reach the magnitude set at the Kyoto protocol in The emission reduction constraints continue to increase beyond 2010 so as to comply, as much as possible, with the IPCC requirement regarding sustainability of greenhouse gas concentration in the very long run. Therefore, since CO2 emissions tend to increase also beyond 2010, even if Kyoto objectives are met in 2010, the reduction constraints become more and more stringent over time. In summary, the global objective for the World involves reducing emissions in 2010 by 6% from baseline (still increasing emissions by more than 30% from 1990). It is further requested accelerating the effort beyond 2010 so as not to exceed emissions higher by 45% to 50% in 2020 and 2030 relatively to the level of Instead the baseline projection would lead to emissions higher in 2020 by 65% and in 2030 by 100% from the level of The following table shows the emission index for the baseline (relatively to 1990) and the allowed emissions under the Kyoto protocol and the extrapolated Kyoto (termed Kyoto forever) as assumed for the GEME-E3 scenarios. Page 2

3 Table 2: Targets for the GEME3 Scenarios Emissions of CO 2 Index in 1990 North America EU-15 Eastern Europe Former Soviet Union Japan Australia & NZ Total Annex B Rest of the World Total World 1990 Baseline Allowed % Kyotoforever Kyoto change Baseline Target from Target baseline Allowed % change from baseline Baseline Kyotoforever Target Allowed % change from baseline Table 2 shows that if the Annex B countries were requested to reduce emissions domestically the necessary reduction effort, relatively to the baseline, would be considerably high, in particular beyond Former Soviet Union countries do not need to reduce emissions from their baseline levels in 2010 and However as they grow, hence increase fuel use and emissions, they are likely to emit more than their target in 2030, therefore they have to reduce in 2030 relatively to their baseline projection. It is also assumed that the non-annex B countries do not need to reduce emissions domestically. Under emission trading regimes, however, the Annex B countries may undertake less emission reduction domestically, although reducing emissions collectively at the desired level. Two trading regimes are assumed: one grouping the Annex B countries only, letting the developing countries entirely unconstrained, and one grouping the whole World in which case the developing countries participate in the collective emission reduction effort. Of course the latter case is completely hypothetical and does not correspond to Kyoto protocol provisions. In summary, the GEME3 World model quantified three scenarios of emission reduction: No Trading: all Annex B countries undertake emission reduction domestically and separately to each other according to the targets shown in Table 2. Annex B Trading: the group within Annex B establish an emission permit trading system based on a grandfathering initial allocation of permits (base year is 1995) and face a collective Annex B emission reduction target, as shown in the Annex B line of Table 2. World Trading: all countries establish an emission permit trading system also based on 1995 grandfathering and face a global emission reduction target, as shown in the World line of Table 2. It is also assumed that all economic agents in a country participating in trading or acting domestically also participate in a sort of country-specific emission trading system. They all (production sectors and households) may purchase or sell permits so as to obtain least cost at equalised marginal abatement cost. The model formulation of the trading system has important economic implications. It is assumed that any net rent obtained by the firms in trading permits is directly reflected to their product selling prices allowing the consumers to benefit in case of positive rents. It is also Page 3

4 assumed that if at the country level the total rents from permit selling is positive, the government improves public finance deficit or surplus by using the net corresponding revenues. The country under such a situation does not get direct benefits because the countrylevel interest rates are kept exogenous and invariant across the scenarios. On the contrary, if households are net buyers of permits their income allocated to consumption is affected, and the volume of consumption is reduced. One could formulate other regimes, as for example the case of allowing governments to redistribute to households (in the form of income subsidy) any positive rent from permits obtained at the country level. This would allow the reestablishment of private income. However this regime has not been analysed in the current GEME3 exercises. The GEME3 World model used for the emission reduction exercises incorporates endogenous bilateral trade at the World level. Therefore, even if a country does not participate in the emission reduction effort, it will bear indirect effects and burdens from all countries trading internationally. The reason is that reallocation of domestic resources in the industrialised world to meet emission constraint may change international market prices, i.e. terms of trade. The aim of using the GEME3 World model is also to analyse the different kinds of influences of Kyoto protocol on world trading. This analysis also considers that the required changes in the energy system will depend very much on the degree of flexibility that will occur in the implementation processes of the Kyoto Protocol. 3 Overview of GEME3 Results 3.1 General mechanism As a consequence of an emission ceiling the production sectors and the consumers perceive higher cost of using fossil fuels, costs that are proportional to their carbon content. The perceived marginal cost reflects the shadow value of the emission ceiling. These perceived costs do not entail transfer payments for the producers and consumers. However, they act as if these costs would to be really paid. Therefore they undergo changes in their production and consumption structure, substituting fossil energy by non-fossil energy and generally nonenergy or less-energy intensive commodities. These changes are propagated throughout the economy and influence demand and supply in all markets for commodities. Substitution in consumption and production is not perfect, therefore both production and consumption become less efficient than in baseline equilibrium, so producers see higher overall costs and consumers lose in welfare. So even if there are no additional direct payments for fossil fuels, production costs hence commodity prices rise as a consequence of emission ceilings. The relative competitiveness of production sectors and countries change. The sectors and countries depending more than others on fossil fuels will obtain lower market shares in trade. Consequently capital will be re-allocated. As capital is perfectly mobile, investment will be more attractive in sectors and countries that obtain relatively higher growth potential in the new distribution. Foreign trade also changes accordingly. In addition, as fossil fuels are generally substituted, the countries exporting fossil fuels tend to suffer more than importers of energy. The latter will partly compensate their losses by gaining, through international trade, higher terms of trade as compared to exporters. Page 4

5 Under a pollution permit regime, the initial allocation of permits plays an important role and influences the new distribution. If for any reason (for example the base year situation in a grandfathering system) a country is endowed with relatively high number of permits, it might be favoured under the emission ceiling as compared to other countries endowed with fewer permits. Generally at any moment a producer and consumer will compare the marginal abatement cost entailed by his substitution possibilities with the prevailing permit price. Therefore at the equilibrium, all marginal abatement costs and the permit prices will be equal to each other within the group of traders. A country being a net seller of permits in this situation will obtain net revenue from abroad. An important issue regards the use of such revenue. If for example this can serve to lower financial needs and relax the capital market, then interest rates might drop in this country, relatively to others, and attract investment further allowing for growth and higher competitiveness. This however will imply more emissions, hence higher abatement costs, a factor that limits the possibility for selling permits. A country not participating in the emission reduction effort, hence in emission trading, starts from a competitive advantage and will obtain a higher market share. However, it will also suffer from higher import prices from countries that do emission reduction. To maintain welfare the non-participating country will have to export and therefore face deteriorating terms of trade. The trade partners will also demand less because their growth is slowing down as a result of their emission reduction effort. The combined effect of these mechanisms might be positive or negative for economic growth of the non-participating countries. 3.2 Implications of the no trading case. In this case each Annex B country has to meet an individual target. Within each country the emission reduction effort is allocated to sectors and households at least cost. The results of the model confirm the above-described mechanism. As a result of imperfect substitution of fossil fuels, there is a general rise of commodity prices, first in the Annex B countries having to reduce emissions then to all countries as the effects propagate through international trade. At the world level prices increase by about 1.3% in 2010, but his rise is higher for countries that face higher difficulty in reaching their targets, like Japan (+3%) and some of the EU member-states (+2%). Higher prices in these countries influence their main trade partners, as for example is the case of China and East Asia that even though not participating in the emission reduction effort they see their prices rising as a consequence of Japanese price rise. A differential increase of prices has several consequences. Countries with higher price increases will export less and import more, therefore their domestic supply will fall. Investment and employment tend to decrease consequently. On the other hand, as the use of energy entails high costs in these countries, non-energy and non-material production factor, like investment and employment, will be demanded more than in other countries. The case of Japan is illustrative. Because substitution mechanisms dominate the effects from diminishing domestic activity, investment and employment are found to change positively in the emission reduction case. Keeping up employment also helps maintaining real wages hence private income and domestic consumption. This acts as a moderator on GDP losses a mechanism. Similarly, depending on the situation of the main trade partners, which can be also illustrated by observing that terms of trade also improve in these cases. Page 5

6 Countries like China, India, Latin America and East Asia do not participate in the emission reduction effort but bear the effects of higher import prices leading to higher domestic prices. Their relative position in international trade improves allowing them to moderate the negative effects and limit the losses in terms of GDP. Countries that export fossil fuels even if not participating in the emission reduction effort bear high consequences. This is the case of North Africa & Middle East, and the case of Former Soviet Union. The modelling results show that generally the spillover effects are high. The consequences on developing countries are important. The effects on world GDP in 2010 also is significant (loss of 1.3% or about 500 billion $). Two sorts of countries bear GDP losses higher than the average: some of those participating in the emission reduction effort and all those that export fossil fuels. Investment (-0.3%) is less affected than GDP, since through perfect capital mobility it also serves for substituting fossil energy. Employment (-0.04%) is also less affected than GDP, but households see higher than GDP fall of their real income (-1.5%). Energy consumption decreases by about 7.7% which is less than the overall fall of carbon dioxide emissions (-11.25%). Since the no trade case is less efficient in economic terms than trading of emissions, the relative higher drop of production activity and consumption leads to higher emission reduction than expected at the world level. Of course the bulk of reduction is undertaken in the Annex B countries (98.9%). The non Annex B countries face higher reduction of their GDP than the reduction of energy and carbon dioxide emissions, which means that both their energy and carbon intensity deteriorate. The marginal abatement costs (in other words the national permit prices) are generally high (239 $/tnc in average) and unequal across the Annex B countries. In 2010, the highest marginal costs are observed for the Nordic EU and Japan, and the lowest for North America. Eastern European countries face a very small marginal cost but for Former Soviet Union the emission constraint is not binding (therefore the marginal cost is zero). Despite this the indirect economic implications on these countries are significant, especially for Russia who is an exporter of fossil fuels. Beyond 2010 the emission reduction effort intensifies while emission trading is not permitted. The economic consequences are considerable leading to about 10% drop of world GDP in Cumulatively over a period of 30 years the world economy is avoiding the emission of about 130 billion of tons of CO2 at a cumulative (non discounted) GDP loss of the order of 35 trillion $ or a one year s loss of world GDP. The marginal abatement costs are also excessively high in 2030 reaching about 1500 $/tnc in average. It should be mentioned that the model version used for this exercise does not allow for endogenous technology progress. Such high abatement costs are likely to induce acceleration of technology progress, in particular in the energy field, leading to lower marginal costs. 3.3 Implications of Annex B Trading Annex B trading implies facing a collective emission ceiling. Given that the no trading exercise revealed high marginal cost differences among the Annex B countries, it is logical to expect significant cost savings from trading in the Annex B group. Page 6

7 The basic mechanism is of course similar to that described above. However the magnitude of all effects is significantly smaller as compared to the no trading case. The cost savings and the moderation of the indirect negative effects on production and consumption lead at a global level to lower emission reduction (-6% in 2010 from baseline) than in the no trading case (- 11.5%). The avoidance of GDP loss is more than proportional: the loss of global GDP under Annex B trading is 0.4% instead of 1.3% in the no trading case. Similar are the effects on all macroeconomic aggregates. The effects are more equally distributed across the Annex B countries and the spillover effects on developing countries are also smaller as compared to the no trade case. The only exception is Former Soviet Union who bears relatively higher costs. This is related to the fact that Former Soviet Union has to decrease emissions domestically (from baseline) under Annex B trading, as facing the marginal abatement cost collectively applied to the Annex B group. Former Soviet Union of course is the main seller of permits and gets high revenues from this. But the model as it stands now limits the effects of these high revenues only to the improvement of public finance deficit (which shows a spectacular surplus under Annex B trading). Should the Former Soviet Union benefits from such surplus to lower for example interest rates, the macroeconomic effects would be different. In addition, as in this country firms sell permits, domestic prices fall. Exports do increase but the terms of trade strongly deteriorate. As the model stands now, workers will see higher real wages and some them will refrain from supplying labour to the labour market pushing downwards real wages. Households are net buyers of permits therefore some of their income is spent to buy permits. To re-establish their private income households need to further accept lower real wages and keep up employment, hence private income and consumption lower. If the government was recycling the positive revenues to subsidy households revenue, then private income and consumption would be maintained, if not increased, allowing for higher domestic activity and GDP for Former Soviet Union. The conclusion is that the mechanism of the model concerning recycling of revenues in case of selling permits has to be revised in the model. Annex B trading implies a more than four times drop of the marginal abatement cost, which approaches in $/tnC for Annex B as a whole. The marginal abatement costs increase beyond 2010, as the emission reduction effort intensifies. The macroeconomic implications for the long-run are still considerable (-6.6% loss of global GDP in 2030). The relative gains from trading as compared to no trading diminish over time since the so-called hot air also decreases in magnitude within the Annex B group. 3.4 Implications of World Trading This scenario explores the hypothetical case of establishing a pollution permit market at the world level. This implies that the developing countries participate in the collective effort of reducing emissions, an assumption that is not provided in the Kyoto protocol. It is also assumed that the Annex B countries do not compensate the developing countries for the incurring costs from participating in the emission reduction effort. The results of the model show a general gain of economic efficiency and a lowering of negative effects, as compared to the other emission reduction scenarios. At the global level, world trading leads to moderate GDP loss in 2010 (-0.24% instead of 0.4% for Annex B Page 7

8 trading case). The general rise of prices is also limited (0.33%) although CO2 emissions are globally reduced as much as in the Annex B trading case. An important change from previous scenarios is that the necessary improvement of energy intensity (which entails relatively high costs through substitution) is much lower than in the other scenarios while the carbon intensity (through changes in the fuel mix) plays a more important role. This of course is related to the fact that developing countries use relatively more coal than developed ones, so by participating in the collective effort they allow for cheaper emission reduction mostly by means of fuel mix changes. China and India generally face slightly higher GDP losses than in the case of Annex B trading. This has consequences on their employment and on global employment which is significantly more affected than in other scenarios. However, the new allocation corresponds to higher sectoral investment, as compared to the other cases. The exporters of fossil fuels generally suffer less under world trading. Former Soviet Union is also less affected. However it still sells permits allowing for lower prices and more exports. However the limitations of the revenue recycling mechanisms as represented in the current version of the model explain also in the case the loss of GDP for Former Soviet Union. Under world trading of emissions about 60% of emission reduction is undertaken in the Annex B countries and 40% in the developing countries. This of course reveals that there is great scope for undertaking emission reduction in the developing world. Over the period of , the cumulative gain (in terms of avoided GDP loss) is of the order of 200 billion $ which of course can be considered as a fund sufficient to partly compensate the developing countries for their emission reduction efforts. In that sense, the results show great scope for intensifying the clean development mechanisms provided for under the Kyoto protocol, if of course this is possible from an institutional point of view. The marginal abatement cost for 2010 halves from its value under Annex B trading, becoming 26$/tnC. In addition the long-run macroeconomic implications from intensifying the reduction effort beyond 2010 are considerably smaller in case of world trading. For example, the marginal abatement cost in 2030 becomes 195$/tnC under world trading, while it was higher equal to1000 $/tnc and even higher in the other emission reduction cases. Under world trading, it will possible to avoid the emission of 100 billion tons of CO2 over a period of 30 years at a cumulative non-discounted loss of 9 trillion $ over the same period, which represents on fourth of one year world GDP. The following tables and figures summarise the results of the model and compares the three scenarios. Page 8

9 Table 3 : Comparison of GDP effects for the three emission reduction scenarios Change of GDP from baseline in % No Trade AnnexB Trading Full World Trading WORLD Australia Japan East Asia China India North America Latin America Nordic EU Germany UK Rest of EU Other Europe Eastern Europe F. Soviet Union N. Africa & ME Africa Rest of World Table 4 : Comparison of CO 2 emission reduction for the three scenarios Change of CO2 from baseline in % No Trade AnnexB Trading Full World Trading WORLD Australia Japan East Asia China India North America Latin America Nordic EU Germany UK Rest of EU Other Europe Eastern Europe F. Soviet Union N. Africa & ME Africa Rest of World Page 9

10 Table 5 : Comparison of pollution permit prices for the three emission reduction scenarios Price of Pollution Permits in $/tc No Trade AnnexB Trading Full World Trading WORLD Australia Japan East Asia China India North America Latin America Nordic EU Germany UK Rest of EU Other Europe Eastern Europe F. Soviet Union N. Africa & ME Africa Rest of World Figure 1 : Pollution permit prices Price of Pollution Permits in No Trading AnnexB Trading World Trading WORLD Australia Japan East Asia China India North America Latin America Nordic EU Germany UK Rest of EU Other Europe Eastern Europe F. Soviet Union N. Africa & ME Africa Rest of World Page 10

11 4 Tables with Summary Results from GEME3 World model 4.1 No trading case Scenario: No trade Case model Results for World % change from baseline Gross Domestic Product Employment Private Investment Private Consumption Domestic Demand Intra World trade Energy consumption in volume Consumers' price index GDP deflator in factor prices Nominal Wage rate Real wage rate CO NOX SO VOC PM Page 11

12 No Trade Scenario % change from baseline World AUZ JAP EAS CHI IND NAM LAM NEU Gross Domestic Product in Employment Private Investment Private Consumption Domestic Demand Exports in volume Imports in volume Intra World Trade Energy consumption in volume Consumers' price index GDP deflator in factor prices Nominal Wage rate Real wage rate Current account as % of GDP (diff.) Terms of Trade CO2 Emissions No Trade Scenario % change from baseline GEU BEU REU OEU CEA FSU NAF AFR ROW Gross Domestic Product in Employment Private Investment Private Consumption Domestic Demand Exports in volume Imports in volume Intra World Trade Energy consumption in volume Consumers' price index GDP deflator in factor prices Nominal Wage rate Real wage rate Current account as % of GDP (diff.) Terms of Trade CO2 Emissions No Trade Scenario Results for the World Domestic Production Investment Exports Imports % change from baseline 2010 Long-term 2010 Long-term Agriculture Coal Oil Gas Electricity Ferrous and non ferrous metals Chemical Products Other energy intensive Electronic Equipment Transport equipment Other Equipment Goods Other Manufacturing products Construction Food Industry Trade and Transport Textile Industry Other Market Services Non Market Services Page 12

13 No Trade Scenario Percent change of CO2 Emissions from baseline scenario % change from baseline Australia, New Zeland Japan Dynamic East Asia China India and rest of Asia North America Latin America EU Nordic countries EU Germany EU Unit. Kingdom EU rest of Member-states Other Europe OECD Central European Associates Former Soviet Union Middle East and North Africa Rest of Africa Rest of the World World World: Effects from No Trading % changes from Baseline Gross Domestic Product Employment Private Investment Domestic Demand Private Consumption Page 13

14 World: Effects from No Trading 0.00 % changes from Baseline CO2 Energy consumption in volume 4.2 Annex B trading case Scenario: Annex B Trading Case model Results for World % change from baseline Gross Domestic Product Employment Private Investment Private Consumption Domestic Demand Intra World trade Energy consumption in volume Consumers' price index GDP deflator in factor prices Nominal Wage rate Real wage rate CO NOX SO VOC PM Page 14

15 Annex B Trading Scenario % change from baseline World AUZ JAP EAS CHI IND NAM LAM NEU Gross Domestic Product in Employment Private Investment Private Consumption Domestic Demand Exports in volume Imports in volume Intra World Trade Energy consumption in volume Consumers' price index GDP deflator in factor prices Nominal Wage rate Real wage rate Current account as % of GDP (diff.) Terms of Trade CO2 Emissions Annex B Trading Scenario % change from baseline GEU BEU REU OEU CEA FSU NAF AFR ROW Gross Domestic Product in Employment Private Investment Private Consumption Domestic Demand Exports in volume Imports in volume Intra World Trade Energy consumption in volume Consumers' price index GDP deflator in factor prices Nominal Wage rate Real wage rate Current account as % of GDP (diff.) Terms of Trade CO2 Emissions Annex B Trading Scenario Results for the World Domestic Production Investment Exports Imports % change from baseline 2010 Long-term 2010 Long-term Agriculture Coal Oil Gas Electricity Ferrous and non ferrous metals Chemical Products Other energy intensive Electronic Equipment Transport equipment Other Equipment Goods Other Manufacturing products Construction Food Industry Trade and Transport Textile Industry Other Market Services Non Market Services Page 15

16 Annex B Trading Scenario Percent change of CO2 Emissions from baseline scenario % change from baseline Australia, New Zeland Japan Dynamic East Asia China India and rest of Asia North America Latin America EU Nordic countries EU Germany EU Unit. Kingdom EU rest of Member-states Other Europe OECD Central European Associates Former Soviet Union Middle East and North Africa Rest of Africa Rest of the World World World: Effects from Annex B Trading % changes from Baseline Gross Domestic Product Employment Private Investment Domestic Demand Private Consumption Page 16

17 World: Effects from Annex B Trading 0.00 % changes from Baseline CO2 Energy consumption in volume 4.3 World trading case Scenario: Full World trade Case model Results for World % change from baseline Gross Domestic Product Employment Private Investment Private Consumption Domestic Demand Intra World trade Energy consumption in volume Consumers' price index GDP deflator in factor prices Nominal Wage rate Real wage rate CO NOX SO VOC PM Page 17

18 Full World Trade Scenario % change from baseline World AUZ JAP EAS CHI IND NAM LAM NEU Gross Domestic Product in Employment Private Investment Private Consumption Domestic Demand Exports in volume Imports in volume Intra World Trade Energy consumption in volume Consumers' price index GDP deflator in factor prices Nominal Wage rate Real wage rate Current account as % of GDP (diff.) Terms of Trade CO2 Emissions Full World Trade Scenario % change from baseline GEU BEU REU OEU CEA FSU NAF AFR ROW Gross Domestic Product in Employment Private Investment Private Consumption Domestic Demand Exports in volume Imports in volume Intra World Trade Energy consumption in volume Consumers' price index GDP deflator in factor prices Nominal Wage rate Real wage rate Current account as % of GDP (diff.) Terms of Trade CO2 Emissions Full World Trade Scenario Results for the World Domestic Production Investment Exports Imports % change from baseline 2010 Long-term 2010 Long-term Agriculture Coal Oil Gas Electricity Ferrous and non ferrous metals Chemical Products Other energy intensive Electronic Equipment Transport equipment Other Equipment Goods Other Manufacturing products Construction Food Industry Trade and Transport Textile Industry Other Market Services Non Market Services Page 18

19 Full World Trade Scenario Percent change of CO2 Emissions from baseline scenario % change from baseline Australia, New Zeland Japan Dynamic East Asia China India and rest of Asia North America Latin America EU Nordic countries EU Germany EU Unit. Kingdom EU rest of Member-states Other Europe OECD Central European Associates Former Soviet Union Middle East and North Africa Rest of Africa Rest of the World World World: Effects from Full World Trading % changes from Baseline Gross Domestic Product Employment Private Investment Domestic Demand Private Consumption Page 19

20 World: Effects from Full World Trading 0.00 % changes from Baseline CO2 Energy consumption in volume 5 Conclusions from World simulations The scenarios with the world version of aimed at analysing the macroeconomic implications of carbon dioxide emission reduction under different emission trading regimes. The analysis showed clear benefits from trading, as compared to a no trading case. The economic efficiency is highly improved. The analyses also showed that the spillover effects on developing countries from Annex B countries undertaking emission reduction are significant. In particular, fossil fuel exporting countries are negatively affected. The role of international trading under the new equilibrium corresponding to a less carbon-emitting world is considerable. World level trading of emissions is even more efficient at a global scale than Annex B trading. However, some of the developing countries bear consequences that are higher than in the case of Annex B trading. The analysis identified great scope for intensifying the clean development mechanism and the Annex B trading as provided for in the Kyoto protocol. The analysis has several limitations and needs to be extended and improved. A major difficulty with the model, as it stands at present, regards the representation of effects from endogenously redistributing the revenues from selling permits in case a country is a net seller of permits. This is of particular interest to study the effects on the Former Soviet Union countries in case of emission trading. Page 20

COMMISSION STAFF WORKING DOCUMENT. Energy prices and costs report. Accompanying the document

COMMISSION STAFF WORKING DOCUMENT. Energy prices and costs report. Accompanying the document EUROPEAN COMMISSION Brussels, 22.1.2014 SWD(2014) 20 final PART 4/4 COMMISSION STAFF WORKING DOCUMENT Energy prices and costs report Accompanying the document COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN

More information

How carbon-proof is Kyoto?

How carbon-proof is Kyoto? How carbon-proof is Kyoto? Carbon leakage and hot air Arjan Lejour and Ton Manders* 1 Abstract Carbon leakage reduces the effectiveness of policies to reduce greenhouse gas emissions as agreed upon by

More information

Energy Prices, Climate Change Policy and U.S. Economic Growth

Energy Prices, Climate Change Policy and U.S. Economic Growth Energy Prices, Climate Change Policy and U.S. Economic Growth Prepared for: Southern Growth Policies Board Annual Conference Biloxi, Mississippi June 8, 2009 By: Dr. Margo Thorning, Ph.D. Senior Vice President

More information

Six greenhouse gases covered by the United Nations Framework Convention on Climate Change (UNFCCC) and its Kyoto Protocol are:

Six greenhouse gases covered by the United Nations Framework Convention on Climate Change (UNFCCC) and its Kyoto Protocol are: Fact sheet: The need for mitigation United Nations Framework Convention on Climate Change Along with adaptation, mitigation is one of the two central approaches in the international climate change process.

More information

Co-ordinated versus uncoordinated European carbon tax solutions analysed with GEM-E3 1 linking the EU-12 countries

Co-ordinated versus uncoordinated European carbon tax solutions analysed with GEM-E3 1 linking the EU-12 countries Co-ordinated versus uncoordinated European carbon tax solutions analysed with GEM-E3 1 linking the EU-12 countries by P. Capros, P. Georgakopoulos, S. Zografakis (NTUniversity Athens) D. Van Regemorter,

More information

2014 BP Madrid forum on energy & sustainability BP 2014

2014 BP Madrid forum on energy & sustainability BP 2014 14 BP Madrid forum on energy & sustainability BP 14 Contents Global energy trends Liquid fuels Refining implications European focus Energy Outlook 35 BP 14 Primary energy consumption growth slows and the

More information

Annex 5A Trends in international carbon dioxide emissions

Annex 5A Trends in international carbon dioxide emissions Annex 5A Trends in international carbon dioxide emissions 5A.1 A global effort will be needed to reduce greenhouse gas emissions and to arrest climate change. The Intergovernmental Panel on Climate Change

More information

Economic Outcomes of a U.S. Carbon Tax. Executive Summary

Economic Outcomes of a U.S. Carbon Tax. Executive Summary Economic Outcomes of a U.S. Carbon Tax Executive Summary [ Overview [ During the ongoing debate on how to address our nation s fiscal challenges, some have suggested that imposing a carbon tax would improve

More information

Energy Megatrends 2020

Energy Megatrends 2020 Energy Megatrends 2020 Esa Vakkilainen 1 NOTE The data included in the following is mainly based on International Energy Agency's (IEA) World Energy Outlook 2007 IEA is considered the most reliable source

More information

Subsidizing Household Capital: How Does Energy Efficiency Policy Compare to a Carbon Tax?

Subsidizing Household Capital: How Does Energy Efficiency Policy Compare to a Carbon Tax? Subsidizing Household Capital: How Does Energy Efficiency Policy Compare to a Carbon Tax? Warwick J. McKibbin*, Adele C. Morris**, and Peter J. Wilcoxen*** This study uses a general equilibrium model to

More information

5 Comparison with the Previous Convergence Programme and Sensitivity Analysis

5 Comparison with the Previous Convergence Programme and Sensitivity Analysis 5 Comparison with the Previous Convergence Programme and Sensitivity Analysis 5.1 Comparison with the Previous Macroeconomic Scenario The differences between the macroeconomic scenarios of the current

More information

PBL Working Paper 15 October 2013. Cost of greenhouse gas mitigation - comparison between TIMER and WorldScan *

PBL Working Paper 15 October 2013. Cost of greenhouse gas mitigation - comparison between TIMER and WorldScan * PBL Working Paper 15 October 2013 Cost of greenhouse gas mitigation - comparison between TIMER and WorldScan * Corjan Brink, Andries Hof, Herman Vollebergh PBL Netherlands Environmental Assessment Agency,

More information

ANNEX 1 - MACROECONOMIC IMPLICATIONS FOR ITALY OF ACHIEVING COMPLIANCE WITH THE DEBT RULE UNDER TWO DIFFERENT SCENARIOS

ANNEX 1 - MACROECONOMIC IMPLICATIONS FOR ITALY OF ACHIEVING COMPLIANCE WITH THE DEBT RULE UNDER TWO DIFFERENT SCENARIOS ANNEX 1 - MACROECONOMIC IMPLICATIONS FOR ITALY OF ACHIEVING COMPLIANCE WITH THE DEBT RULE UNDER TWO DIFFERENT SCENARIOS The aim of this note is first to illustrate the impact of a fiscal adjustment aimed

More information

An Environmental Perspective on International Greenhouse Gas Emission Trading

An Environmental Perspective on International Greenhouse Gas Emission Trading An Environmental Perspective on International Greenhouse Gas Emission Trading Speaking Notes for Chris Rolfe West Coast Environmental Law Association Speaking Notes for a Presentation to After Kyoto --

More information

Economic Impacts of Potential Colorado Climate Change Initiatives: Evidence from MIT and Penn State Analyses. July 2007

Economic Impacts of Potential Colorado Climate Change Initiatives: Evidence from MIT and Penn State Analyses. July 2007 Economic Impacts of Potential Colorado Climate Change Initiatives: Evidence from MIT and Penn State Analyses July 2007 Introduction California and other western states are actively pursuing a variety of

More information

Summary of the Impact assessment for a 2030 climate and energy policy framework

Summary of the Impact assessment for a 2030 climate and energy policy framework Summary of the Impact assessment for a 2030 climate and energy policy framework Contents Overview a. Drivers of electricity prices b. Jobs and growth c. Trade d. Energy dependence A. Impact assessment

More information

The Economic Impacts of Reducing. Natural Gas and Electricity Use in Ontario

The Economic Impacts of Reducing. Natural Gas and Electricity Use in Ontario The Economic Impacts of Reducing Natural Gas and Electricity Use in Ontario Prepared for Blue Green Canada July 2013 Table of Contents Executive Summary... i Key Findings... i Introduction...1 Secondary

More information

Some micro- and macro-economics of offshore wind*

Some micro- and macro-economics of offshore wind* Some micro- and macro-economics of offshore wind* EPSRC SUPERGEN Wind Energy Hub University of Strathclyde May 2016 Fraser of Allander Institute Energy Modelling Team Fraser of Allander Institute Department

More information

Proposal of Upstream Emissions Trading in Japan

Proposal of Upstream Emissions Trading in Japan OECD GLOBAL FORUM ON SUSTAINABLE DEVELOPMENT: EMISSIONS TRADING CONCERTED ACTION ON TRADEABLE EMISSIONS PERMITS COUNTRY FORUM OECD Headquarters, Paris 17-18 March, 2003 Proposal of Upstream Emissions Trading

More information

World Energy Outlook 2007: China and India Insights. www.worldenergyoutlook.org International Energy Agency

World Energy Outlook 2007: China and India Insights. www.worldenergyoutlook.org International Energy Agency World Energy Outlook 27: China and India Insights www.worldenergyoutlook.org International Energy Agency Why Focus on China & India? Increase in World Primary Energy Demand, Imports & Energy-Related CO

More information

Discussion Paper No. 01-65. Contraction of Global Carbon Emissions: How Acceptable Are Alternative Emission Entitlement Schemes?

Discussion Paper No. 01-65. Contraction of Global Carbon Emissions: How Acceptable Are Alternative Emission Entitlement Schemes? Discussion Paper No. 01-65 Contraction of Global Carbon Emissions: How Acceptable Are Alternative Emission Entitlement Schemes? Christoph Böhringer and Heinz Welsch ZEW Zentrum für Europäische Wirtschaftsforschung

More information

Project LINK Meeting New York, 20-22 October 2010. Country Report: Australia

Project LINK Meeting New York, 20-22 October 2010. Country Report: Australia Project LINK Meeting New York, - October 1 Country Report: Australia Prepared by Peter Brain: National Institute of Economic and Industry Research, and Duncan Ironmonger: Department of Economics, University

More information

Comparing Levels of Development

Comparing Levels of Development 2 Comparing Levels of Development Countries are unequally endowed with natural capital. For example, some benefit from fertile agricultural soils, while others have to put a lot of effort into artificial

More information

Saving energy: bringing down Europe s energy prices

Saving energy: bringing down Europe s energy prices Saving energy: bringing down Europe s energy prices Saving energy: bringing down Europe s energy prices By: Dr. Edith Molenbroek, Prof. Dr. Kornelis Blok Date: May 2012 Project number: BUINL12344 Ecofys

More information

Appendix SM1: Sources of Modal Data and Calculation of Modal Shares

Appendix SM1: Sources of Modal Data and Calculation of Modal Shares Online Appendix for Trade and the Greenhouse Gas Emissions from International Freight Transport, Cristea Anca, David Hummels, Laura Puzzello and Avetisyan Misak: Supplementary Materials The supplementary

More information

NEW NUCLEAR POWER PLANT UNIT IN FINLAND ACCEPTED BY THE FINNISH PARLIAMENT

NEW NUCLEAR POWER PLANT UNIT IN FINLAND ACCEPTED BY THE FINNISH PARLIAMENT International Conference Nuclear Energy for New Europe 2002 Kranjska Gora, Slovenia, September 9-12, 2002 www.drustvo-js.si/gora2002 NEW NUCLEAR POWER PLANT UNIT IN FINLAND ACCEPTED BY THE FINNISH PARLIAMENT

More information

I. World trade developments

I. World trade developments I. World trade developments World merchandise exports stagnated in value terms in 2012 while exports of commercial services increased by 2 per cent. Key developments in 2012: a snapshot Trade data List

More information

THE UPDATE OF THE EURO EFFECTIVE EXCHANGE RATE INDICES

THE UPDATE OF THE EURO EFFECTIVE EXCHANGE RATE INDICES September 2004 THE UPDATE OF THE EURO EFFECTIVE EXCHANGE RATE INDICES Executive summary In September 2004, the European Central Bank (ECB) has updated the overall trade weights underlying the ECB nominal

More information

2052 - A Global Forecast

2052 - A Global Forecast 252 - A Global Forecast for the Next Forty Years Jorgen Randers Professor Center for Climate Strategy Norwegian Business School BI J Randers 1 Pioneers of Energy Transition - Conference Vienna, Austria

More information

Netherlands National Energy Outlook 2014

Netherlands National Energy Outlook 2014 Netherlands National Energy Outlook 2014 Summary Michiel Hekkenberg (ECN) Martijn Verdonk (PBL) (project coordinators) February 2015 ECN-E --15-005 Netherlands National Energy Outlook 2014 Summary 2 The

More information

World Energy Outlook 2009. Presentation to the Press London, 10 November 2009

World Energy Outlook 2009. Presentation to the Press London, 10 November 2009 World Energy Outlook 29 Presentation to the Press London, 1 November 29 The context The worst economic slump since the 2 nd World War & signs of recovery but how fast? An oil price collapse & then a rebound

More information

Lecture 1: The intertemporal approach to the current account

Lecture 1: The intertemporal approach to the current account Lecture 1: The intertemporal approach to the current account Open economy macroeconomics, Fall 2006 Ida Wolden Bache August 22, 2006 Intertemporal trade and the current account What determines when countries

More information

The impact of increased efficiency in the use of energy: A computable general equilibrium analysis for Spain

The impact of increased efficiency in the use of energy: A computable general equilibrium analysis for Spain The impact of increased efficiency in the use of energy: A computable general equilibrium analysis for Spain Pablo Arocena Universidad Pública de Navarra Nafarroako Unibertsitate Publikoa OUTLINE o Motivation:

More information

Factors affecting the inbound tourism sector. - the impact and implications of the Australian dollar

Factors affecting the inbound tourism sector. - the impact and implications of the Australian dollar Factors affecting the inbound tourism sector - the impact and implications of the Australian dollar 1 Factors affecting the inbound tourism sector - the impact and implications of the Australian dollar

More information

The Japanese economy?

The Japanese economy? The Japanese economy? Franz Waldenberger Japan Center and Munich School of Management --University Munich LMU waldenberger@bwl.lmu.de 1 Outline 2 1. GDP economic recovery 2. GDP per head two lost decades

More information

From Carbon Subsidy to Carbon Tax: India s Green Actions 1

From Carbon Subsidy to Carbon Tax: India s Green Actions 1 From Carbon Subsidy to Carbon Tax: India s Green Actions 1 09 CHAPTER 9.1 INTRODUCTION The recent steep decline in international oil prices is seen by many as an opportunity to rationalize the energy prices

More information

New Zealand s response to climate change. March 2008 www.nzinstitute.org

New Zealand s response to climate change. March 2008 www.nzinstitute.org New Zealand s response to climate change March 2008 www.nzinstitute.org THE AIM OF THIS PRESENTATION This presentation summarises the research, analysis, and recommendations made in the New Zealand Institute

More information

Nuclear power is part of the solution for fighting climate change

Nuclear power is part of the solution for fighting climate change Nuclear power is part of the solution for fighting climate change "Nuclear for Climate" is an initiative undertaken by the members of the French Nuclear Energy Society (SFEN), the American Nuclear Society

More information

ECONOMIC GROWTH* Chapter. Key Concepts

ECONOMIC GROWTH* Chapter. Key Concepts Chapter 5 MEASURING GDP AND ECONOMIC GROWTH* Key Concepts Gross Domestic Product Gross domestic product, GDP, is the market value of all the final goods and services produced within in a country in a given

More information

Why are developing countries exempt from the emissions targets?

Why are developing countries exempt from the emissions targets? Kyoto Protocol Overview The Kyoto Protocol is a legally binding, international agreement that sets targets for industrialized countries to limit or reduce their emissions of greenhouse gases (GHG) by the

More information

Framework of the energy taxation: the situation in OECD countries!

Framework of the energy taxation: the situation in OECD countries! Framework of the energy taxation: the situation in OECD countries! Presentation at the seminar JORNADA SOBRE LA FISCALIDAD AMBIENTAL EN LA ENERGÍA Y SU APLICACIÓN EN ESPAÑA Hosted by the Institute for

More information

Energy Projections 2006 2030 Price and Policy Considerations. Dr. Randy Hudson Oak Ridge National Laboratory

Energy Projections 2006 2030 Price and Policy Considerations. Dr. Randy Hudson Oak Ridge National Laboratory Energy Projections 2006 2030 Price and Policy Considerations Dr. Randy Hudson Oak Ridge National Laboratory There is perhaps no single current topic so potentially impacting to all life on this planet

More information

Working Paper #54. Greenhouse Gas Implications in Large Scale Infrastructure Investments in Developing Countries: Examples from China and India

Working Paper #54. Greenhouse Gas Implications in Large Scale Infrastructure Investments in Developing Countries: Examples from China and India Greenhouse Gas Implications in Large Scale Infrastructure Investments in Developing Countries: Examples from China and India Mike Jackson, Sarah Joy, Thomas C. Heller, and David G. Victor Working Paper

More information

Outline. 1. Climate and energy: where do we stand? 2. Why a new framework for 2030? 3. How it works. 4. Main challenges. 5.

Outline. 1. Climate and energy: where do we stand? 2. Why a new framework for 2030? 3. How it works. 4. Main challenges. 5. 1 Outline 1. Climate and energy: where do we stand? 2. Why a new framework for 2030? 3. How it works 4. Main challenges 5. and benefits 6. Other key points 7. Next steps 2 1. Climate and energy: where

More information

Revealing the costs of air pollution from industrial facilities in Europe a summary for policymakers

Revealing the costs of air pollution from industrial facilities in Europe a summary for policymakers Revealing the costs of air pollution from industrial facilities in Europe a summary for policymakers A new European Environment Agency (EEA report, Revealing the costs of air pollution from industrial

More information

World Energy Outlook. Dr. Fatih Birol IEA Chief Economist Paris, 27 February 2014

World Energy Outlook. Dr. Fatih Birol IEA Chief Economist Paris, 27 February 2014 World Energy Outlook Dr. Fatih Birol IEA Chief Economist Paris, 27 February 2014 The world energy scene today Some long-held tenets of the energy sector are being rewritten Countries are switching roles:

More information

0 100 200 300 Real income (Y)

0 100 200 300 Real income (Y) Lecture 11-1 6.1 The open economy, the multiplier, and the IS curve Assume that the economy is either closed (no foreign trade) or open. Assume that the exchange rates are either fixed or flexible. Assume

More information

Economic Development and the Risk of Global Climate Change

Economic Development and the Risk of Global Climate Change 14 Economic Development and the Risk of Global Climate Change Who is primarily responsible for creating the risk of global climate change? 78 Since the industrial revolution, economic development has been

More information

EU study on company car taxation: presentation of the main results

EU study on company car taxation: presentation of the main results European Commission EU study on company car taxation: presentation of the main results Presentation in the OECD workshop on estimating support to fossil fuels, Paris 18-19 November 2010 Katri Kosonen European

More information

The Economics of Climate Change C 175. To Kyoto and Beyond. Spring 09 UC Berkeley Traeger 7 International Cooperation 22

The Economics of Climate Change C 175. To Kyoto and Beyond. Spring 09 UC Berkeley Traeger 7 International Cooperation 22 To Kyoto and Beyond 7 International Cooperation 22 International Cooperation on Climate Change 1988 United Nations General Assembly adopted resolution urging the protection of global climate for present

More information

An Evaluation of the Possible

An Evaluation of the Possible An Evaluation of the Possible Macroeconomic Impact of the Income Tax Reduction in Malta Article published in the Quarterly Review 2015:2, pp. 41-47 BOX 4: AN EVALUATION OF THE POSSIBLE MACROECONOMIC IMPACT

More information

An Early Action Proposal with Known Costs: A Sensible and Realistic Option for Emissions Trading in Australia

An Early Action Proposal with Known Costs: A Sensible and Realistic Option for Emissions Trading in Australia An Early Action Proposal with Known Costs: A Sensible and Realistic Option for Emissions Trading in Australia Warwick J. McKibbin Australian National University and The Brookings Institution Paper to be

More information

Executive summary. Global Wage Report 2014 / 15 Wages and income inequality

Executive summary. Global Wage Report 2014 / 15 Wages and income inequality Executive summary Global Wage Report 2014 / 15 Wages and income inequality Global Wage Report 2014/15 Wages and income inequality Executive summary INTERNATIONAL LABOUR OFFICE GENEVA Copyright International

More information

Methane emissions trading

Methane emissions trading 24 Chapter 3: Methane emissions trading Methane emissions trading One of the key issues in this report is whether methane trading is a viable option for the UK. Market based trading schemes are currently

More information

CHAPTER 11. AN OVEVIEW OF THE BANK OF ENGLAND QUARTERLY MODEL OF THE (BEQM)

CHAPTER 11. AN OVEVIEW OF THE BANK OF ENGLAND QUARTERLY MODEL OF THE (BEQM) 1 CHAPTER 11. AN OVEVIEW OF THE BANK OF ENGLAND QUARTERLY MODEL OF THE (BEQM) This model is the main tool in the suite of models employed by the staff and the Monetary Policy Committee (MPC) in the construction

More information

Module 1: Introduction to Industrial Energy Management

Module 1: Introduction to Industrial Energy Management Module 1: Introduction to Industrial Energy Management Organisations that successfully manage energy have business processes to plan, monitor, and control energy use, just as they do for other corporate

More information

Exploring the Potential for International Mitigation Clubs for the Road from Paris - An initial exploration -

Exploring the Potential for International Mitigation Clubs for the Road from Paris - An initial exploration - Exploring the Potential for International Mitigation Clubs for the Road from Paris - An initial exploration - Preliminary results Steven Rose and Richard Richels 15th IEA-IETA-EPRI Annual Workshop on Greenhouse

More information

JET-SET. Joint Emissions Trading as a Socio-Ecological Transformation. Cross-Section Project 3

JET-SET. Joint Emissions Trading as a Socio-Ecological Transformation. Cross-Section Project 3 JET-SET Joint Emissions Trading as a Socio-Ecological Transformation Cross-Section Project 3 Linking the EU Emissions Trading Scheme under Alternative Climate Policy Stringencies: An Economic Impact Assessment

More information

Interview: Aurélie Faure, Financial Analyst at Dexia Asset Management

Interview: Aurélie Faure, Financial Analyst at Dexia Asset Management Research letter n 09/03 October 2009 http://www.carbonium.fr/pdf/research0903.pdf CONTENTS Interview: Aurélie Faure, Financial Analyst at Dexia Asset Management... p. 1 Hot topics in Copenhagen... p. 3

More information

GLOBAL RENEWABLE ENERGY MARKET OUTLOOK 2013

GLOBAL RENEWABLE ENERGY MARKET OUTLOOK 2013 GLOBAL RENEWABLE ENERGY MARKET OUTLOOK 213 FACT PACK GUY TURNER HEAD OF ECONOMICS AND COMMODITIES APRIL 26, 213 GLOBAL RENEWABLE ENERGY MARKET OUTLOOK, 26 APRIL 213 1 INTRODUCTION This year s Global Renewable

More information

Norwegian position on the proposed EU framework for climate and energy policies towards 2030

Norwegian position on the proposed EU framework for climate and energy policies towards 2030 Norwegian position on the proposed EU framework for climate and energy policies towards 2030 The EU plays an important role as a global leader in climate policy and has a fundamental interest in strengthening

More information

Roadmap for moving to a competitive low carbon economy in 2050

Roadmap for moving to a competitive low carbon economy in 2050 Roadmap for moving to a competitive low carbon economy in 2050 COUNTRY CAPITAL XXX, 9 March 2011 NAME XXX DG Climate Action European Commission 1 Limiting climate change a global challenge Keeping average

More information

Implementing the EU renewable target through green certificate markets.

Implementing the EU renewable target through green certificate markets. Implementing the EU renewable target through green certificate markets. by Finn Roar Aune, Hanne Marit Dalen and Cathrine Hagem Statistics Norway, Research Department, PO Box Dept., N-0033 Oslo, Norway

More information

UNEP IMF GIZ - GSI workshop. Reforming Fossil Fuel Subsidies for an Inclusive Green Economy

UNEP IMF GIZ - GSI workshop. Reforming Fossil Fuel Subsidies for an Inclusive Green Economy UNEP IMF GIZ - GSI workshop Reforming Fossil Fuel Subsidies for an Inclusive Green Economy April, 2014 1 Index I. Pricing Policy and Implicit Subsidies: a) Fossil fuels b) Electricity II. Mexican Fiscal

More information

Global growth rates Macroeconomic indicators CEDIGAZ Reference Scenario

Global growth rates Macroeconomic indicators CEDIGAZ Reference Scenario Medium and Long Term Natural Gas Outlook CEDIGAZ February 215 Global growth rates Macroeconomic indicators CEDIGAZ Reference Scenario 4 3 %/year 199-213 213-235 6 Main consuming markets - %/year (213-235)

More information

Analysis of the Impact of High Oil Prices on the Global Economy. International Energy Agency May 2004

Analysis of the Impact of High Oil Prices on the Global Economy. International Energy Agency May 2004 Analysis of the Impact of High Oil Prices on the Global Economy International Energy Agency May 2004 SUMMARY Oil prices still matter to the health of the world economy. Higher oil prices since 1999 partly

More information

NEW RENEWABLE ENERGY INNOVATION PARTNERSHIPS: ELEMENTS OF A CONSTRUCTIVE CARBON STRATEGY FOR NORWAY S INDUSTRY AND GOVERNMENT

NEW RENEWABLE ENERGY INNOVATION PARTNERSHIPS: ELEMENTS OF A CONSTRUCTIVE CARBON STRATEGY FOR NORWAY S INDUSTRY AND GOVERNMENT J4-3 NEW RENEWABLE ENERGY INNOVATION PARTNERSHIPS: ELEMENTS OF A CONSTRUCTIVE CARBON STRATEGY FOR NORWAY S INDUSTRY AND GOVERNMENT J. Buen, Research Fellow, Centre for Technology and Society, Norwegian

More information

Session 7: Accounting and avoiding double counting Breakout Group Exercises

Session 7: Accounting and avoiding double counting Breakout Group Exercises Session 7: Accounting and avoiding double counting Breakout Group Exercises Introduction It is anticipated that some countries will use internationally transferred carbon assets to help meet their emission

More information

THE UK CLIMATE CHANGE PROGRAMME AND EXAMPLES OF BEST PRACTICE. Gabrielle Edwards United Kingdom

THE UK CLIMATE CHANGE PROGRAMME AND EXAMPLES OF BEST PRACTICE. Gabrielle Edwards United Kingdom Workshop on Best Practices in Policies and Measures, 11 13 April 2000, Copenhagen THE UK CLIMATE CHANGE PROGRAMME AND EXAMPLES OF BEST PRACTICE Gabrielle Edwards United Kingdom Abstract: The UK published

More information

Units of Trade in the New Zealand Emissions Trading Scheme Briefing for the Climate Change Leadership Forum

Units of Trade in the New Zealand Emissions Trading Scheme Briefing for the Climate Change Leadership Forum Units of Trade in the New Zealand Emissions Trading Scheme Briefing for the Climate Change Leadership Forum Prepared by the Emissions Trading Group Published in December 2007 by the Ministry for the Environment

More information

Global Investing 2013 Morningstar. All Rights Reserved. 3/1/2013

Global Investing 2013 Morningstar. All Rights Reserved. 3/1/2013 Global Investing 2013 Morningstar. All Rights Reserved. 3/1/2013 World Stock Market Capitalization Year-end 2012 18.5% 9.6% United States International: Other Europe United Kingdom Japan Other Pacific

More information

UNIT I NATIONAL INCOME AND MACROECONOMICS

UNIT I NATIONAL INCOME AND MACROECONOMICS UNIT I NATIONAL INCOME AND MACROECONOMICS 1 National Income National Income is defined as the sum total of all the goods and services produced in a country, in a particular period of time. Normally this

More information

Biomass Pellet Prices Drivers and Outlook What is the worst that can happen?

Biomass Pellet Prices Drivers and Outlook What is the worst that can happen? Biomass Pellet Prices Drivers and Outlook What is the worst that can happen? European Biomass Power Generation 1st October 2012 Cormac O Carroll Director, London Office Pöyry Management Consulting (UK)

More information

Updated development of global greenhouse gas emissions 2013

Updated development of global greenhouse gas emissions 2013 Updated development of global greenhouse gas emissions 2013 Hans-Joachim Ziesing Low Carbon Markets and the Legacy of Nuclear Power 19 th REFORM Group Meeting, Schloss Leopoldskron, Salzburg September

More information

Practice Problems on Current Account

Practice Problems on Current Account Practice Problems on Current Account 1- List de categories of credit items and debit items that appear in a country s current account. What is the current account balance? What is the relationship between

More information

Statistics Netherlands. Macroeconomic Imbalances Factsheet

Statistics Netherlands. Macroeconomic Imbalances Factsheet Macroeconomic Imbalances Factsheet Introduction Since the outbreak of the credit crunch crisis in 2008, and the subsequent European debt crisis, it has become clear that there are large macroeconomic imbalances

More information

WORLD ENERGY INVESTMENT OUTLOOK 2014 FACTSHEET OVERVIEW

WORLD ENERGY INVESTMENT OUTLOOK 2014 FACTSHEET OVERVIEW OVERVIEW More than $1.6 trillion was invested in 2013 in energy supply, a figure that has more than doubled in real terms since 2000, and a further $130 billion to improve energy efficiency. Renewables

More information

2052 A Global Forecast for the Next Forty Years

2052 A Global Forecast for the Next Forty Years 252 A Global Forecast for the Next Forty Years Jorgen Randers Professor Center for Climate Strategy Norwegian Business School BI J Randers 1 European Investment Bank Luxembourg, November 2, 213 12 scenarios

More information

Economic Systems. 1. MARKET ECONOMY in comparison to 2. PLANNED ECONOMY

Economic Systems. 1. MARKET ECONOMY in comparison to 2. PLANNED ECONOMY Economic Systems The way a country s resources are owned and the way that country takes decisions as to what to produce, how much to produce and how to distribute what has been produced determine the type

More information

ACCOUNTING FOR ASIA S NATURAL CAPITAL

ACCOUNTING FOR ASIA S NATURAL CAPITAL ACCOUNTING FOR S NATURAL CAPITAL DRIVING THE TRANSITION TO A RESOURCE-EFFICIENT GREEN ECONOMY Asia s rapid economic growth during recent decades has been accompanied by serious depletion of the region

More information

How To Change The Global Greenhouse Gas Cost Curve

How To Change The Global Greenhouse Gas Cost Curve Impact of the financial crisis on carbon economics Version 2.1 of the Global Greenhouse Gas Abatement Cost Curve McKinsey & Company takes sole responsibility for the final content of this report, unless

More information

Fossil fuels and climate change: alternative projections to 2050

Fossil fuels and climate change: alternative projections to 2050 Fossil fuels and climate change: alternative projections to 2050 Key questions in the climate change debate are to what extent fossil fuel depletion will reduce emissions, and what country-by-country emissions

More information

The Global Chemical Industry: US, China and Global Status and Opportunities, 2015

The Global Chemical Industry: US, China and Global Status and Opportunities, 2015 The Global Chemical Industry: US, China and Global Status and Opportunities, 2015 August 28, 2005 American Chemical Society Martha Gilchrist Moore Moore Economics mmoore@mooreeconomics.com Opportunities

More information

Emission Trading beyond Europe: Linking Schemes in a Post-Kyoto World

Emission Trading beyond Europe: Linking Schemes in a Post-Kyoto World Emission Trading beyond Europe: Linking Schemes in a Post-Kyoto World Niels Anger Centre for European Economic Research (ZEW) P.O. Box 103443, 68034 Mannheim, Germany. Email: anger@zew.de Abstract. This

More information

THE SOCIOECONOMIC IMPLICATIONS OF RENEWABLE ENERGY AND LOW CARBON TRAJECTORIES IN SOUTH AFRICA

THE SOCIOECONOMIC IMPLICATIONS OF RENEWABLE ENERGY AND LOW CARBON TRAJECTORIES IN SOUTH AFRICA THE SOCIOECONOMIC IMPLICATIONS OF RENEWABLE ENERGY AND LOW CARBON TRAJECTORIES IN SOUTH AFRICA Tara Caetano and James Thurlow Green and Social Workshop 12-13 March 2014 Bonn, Germany Introduction Literature

More information

Week 4 Tutorial Question Solutions (Ch2 & 3)

Week 4 Tutorial Question Solutions (Ch2 & 3) Chapter 2: Q1: Macroeconomics P.52 Numerical Problems #3 part (a) Q2: Macroeconomics P.52 Numerical Problems #5 Chapter 3: Q3: Macroeconomics P.101 Numerical Problems #5 Q4: Macroeconomics P102 Analytical

More information

ON OECD I-O DATABASE AND ITS EXTENSION TO INTER-COUNTRY INTER- INDUSTRY ANALYSIS " Norihiko YAMANO"

ON OECD I-O DATABASE AND ITS EXTENSION TO INTER-COUNTRY INTER- INDUSTRY ANALYSIS  Norihiko YAMANO ON OECD I-O DATABASE AND ITS EXTENSION TO INTER-COUNTRY INTER- INDUSTRY ANALYSIS " Norihiko YAMANO" OECD Directorate for Science Technology and Industry" " 1 February 2012" INTERNATIONAL WORKSHOP ON FRONTIERS

More information

Ghana South Korea United States. Real GDP per capita (2005 dollars) Per centage of 1960 real GDP per capita. 2009 real GDP per capita

Ghana South Korea United States. Real GDP per capita (2005 dollars) Per centage of 1960 real GDP per capita. 2009 real GDP per capita Long-Run Economic Growth chapter: 24 9 ECONOMICS MACROECONOMICS 1. The accompanying table shows data from the Penn World Table, Version 7.0, for real GDP in 2005 U.S. dollars for Argentina, Ghana, South

More information

In 2012, GNP in constant prices increased by 1.8% compared with 2011.

In 2012, GNP in constant prices increased by 1.8% compared with 2011. 8 Economy In 2012, GNP in constant prices increased by 1.8% compared with 2011. The building and construction sector fell by 7.7% in value added terms in 2012 compared to 2011. Manufacturing industry decreased

More information

II. Merchandise trade

II. Merchandise trade II. Merchandise trade Merchandise trade increased by 5 per cent in volume in 211. The strongest momentum was achieved by trade in manufactured goods, which grew by.5 per cent. Key developments in 211:

More information

Intended Nationally Determined Contribution

Intended Nationally Determined Contribution Department of Environment Islamic Republic of Iran Intended Nationally Determined Contribution 19 November 2015 National Climate Change Committee: Iran INDC, page 1 1. Introduction The Islamic Republic

More information

Resolution: Energy and climate. Year and Congress: November 2009, Barcelona. Category: Environment and Energy. Page: 1. Energy and climate change

Resolution: Energy and climate. Year and Congress: November 2009, Barcelona. Category: Environment and Energy. Page: 1. Energy and climate change The European Liberal Democrat and Reform Party, convening in, Catalonia on 19th and 20th November 2009: Notes that: The EU is responsible for approximately 10 per cent of global greenhouse gas emissions

More information

EU renewable energy and biofuel targets what will they mean?

EU renewable energy and biofuel targets what will they mean? EU renewable energy and biofuel targets what will they mean? Background The EU Commission has today tabled proposals for reductions in carbon dioxide emissions a 20% cut by 2020. Alongside this legally

More information

WP1 Task 1 The Drivers of Electricity Demand and Supply

WP1 Task 1 The Drivers of Electricity Demand and Supply PROJECT NO 518294 SES6 CASES COST ASSESSMENT OF SUSTAINABLE ENERGY SYSTEMS Observatoire Méditerranéen de l Energie WP1 Task 1 The Drivers of Electricity Demand and Supply Version April 2007 1. Drivers

More information

Meeting with Analysts

Meeting with Analysts CNB s New Forecast (Inflation Report IV/) Meeting with Analysts Tibor Hlédik Prague, 7 November, Outline Assumptions of the forecast The new macroeconomic forecast Comparison with the previous forecast

More information

Comprehensive emissions per capita for industrialised countries

Comprehensive emissions per capita for industrialised countries THE AUSTRALIA INSTITUTE Comprehensive emissions per capita for industrialised countries Hal Turton and Clive Hamilton The Australia Institute September 2001 the Parties included in Annex I shall implement

More information

INTRODUCTION TO MACROECONOMICS MIDTERM- SAMPLE QUESTIONS

INTRODUCTION TO MACROECONOMICS MIDTERM- SAMPLE QUESTIONS INTRODUCTION TO MACROECONOMICS MIDTERM- SAMPLE QUESTIONS MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) In May 2009, Ford Motor Company's sales

More information

WORLDWIDE RETAIL ECOMMERCE SALES: EMARKETER S UPDATED ESTIMATES AND FORECAST THROUGH 2019

WORLDWIDE RETAIL ECOMMERCE SALES: EMARKETER S UPDATED ESTIMATES AND FORECAST THROUGH 2019 WORLDWIDE RETAIL ECOMMERCE SALES: EMARKETER S UPDATED ESTIMATES AND FORECAST THROUGH 2019 Worldwide retail sales including in-store and internet purchases will surpass $22 trillion in 2015, up 5.6% from

More information

Climate Change and Reduction of CO 2 Emissions: the role of Developing Countries in Carbon Trade Markets

Climate Change and Reduction of CO 2 Emissions: the role of Developing Countries in Carbon Trade Markets DRAFT PAPER, DO NOT QUOTE Climate Change and Reduction of CO 2 Emissions: the role of Developing Countries in Carbon Trade Markets Carlos de Miguel a Carlos Ludena b Andres Schuschny a Paper prepared for

More information

www.pwc.co.uk/economics Global wage projections to 2030 September 2013

www.pwc.co.uk/economics Global wage projections to 2030 September 2013 www.pwc.co.uk/economics Global wage projections to 2030 Summary: Wage gap between emerging and advanced economies will shrink significantly by 2030 By 2030, our projections in this report suggest that

More information