LinkS

Linking global and regional energy Strategies

www.sintef.no/links

The global community has to agree on strategies that are efficient and acceptable in several regions.

LinkS was designed to analyze how global long-term strategies can be used as guidelines for the development of energy supply and technology deployment in the regional energy systems of Europe and China.

The EU has ambitious strategies for renewable energy and emission mitigation, while other regions have no specific strategies yet. If rapidly growing economies like Brazil, Russia, India and China delay their emission reduction efforts, the OECD countries have to do correspondingly more to keep total greenhouse gas (GHG) emissions within necessary limits by the end of this century.

Linking global and regional energy strategies

Thisemissionsmitigationstrategydiffersfundamentallyfromthe450and650ppmscenarios.Thelatteremployacarbonpricealone, whereastheformeremploysacombinationofpoliciesthatincluderegulatoryinstrumentsinadditiontoacap-and-traderegime.Thisnewpolicypackagewaseffectiveinachievinglargereductionsintheemissionofanthropogenicclimateforcingagents.

Thesocio-economiccostwas10-15percenthigherthanapurecarbontaxpolicy,butitloweredthetaxemergingfromthecarbonmarket.Thecarbonpriceliesbetweencarbontaxesinthe450and650ppmlimitcases,asmightbeexpectedsincetheGlobal20-20-20policypackageproducesradiativeforcingof3.2W/m2in2095,orapproximately505ppm CO2-e.Intheyear2095,carbonpricepertonneofCO2 forthe650ppmscenarioisapproximately$200,thecarbonpriceforthe505ppmCO2-elimitis$300,andcarbonpriceforthe450ppmscenarioisalmost$800.

Regional energy strategies: Europe and ChinaIntheEuropeanregionalstudiesthedevelopmentofthepowersystemisanalysedbytheEMPIREandtheEMPSmodelsbasedoninputdatafromtheoverallglobalGCAMmodelinatimeperspectiveto2060.IndividualcountriesinEuropehavefasterdevelopmentsintheenergysectorthanestimatedbyGCAM.Thisiscausedbytheambitiouspoliciesforenergyefficiency,renewableenergyandemissionsreductionsintroducedintheEUthelastyears.

TheGlobal20-20-20scenarioisespeciallyinterestingwithrespect to generation and transmission capacities, as it is the policyscenariowiththelowestdemandin2050comparedtothetwoothers.However,intermsofgenerationcapacity,investmentsarejustashighasinthe650ppmscenario,due

Global energy strategies AsanoverallapproachLinkSusedthegloballong-termmodelGCAMasthe“topmodel”thatgavelong-termscenariosforthedevelopmentofglobaleconomy,energy,landuseandclimatechangemitigationin14differentregionsoftheworldasshownonthemap.Wedevelopedandexploredeffectiveregionalstrategiestolimithumanclimateimpactsfor5differentscenarios.

FourofthescenariosaretraditionalscenariosforlimitingCO2equivalents(CO2-e)intheatmosphereby2095withdifferenttechnologyavailability:“450ppmlimit”,“650ppmlimit”,“650ppmlimitwithoutCCS”,“650ppmlimitwithoutnuclearorCCS”.

Boththe450ppmCO2-eand650ppmCO2-escenariossharethesamesocioeconomic,technologyavailabilityandpolicyinstrumentassumptions.Wefoundthatbothweretechnicallyfeasible,butbothrequiredimmediatedeparturesfromthereferencepathway.Themoreambitiousclimategoal was more expensive.

InthefifthandfinalscenarioweextendtheEU20-20-20policiesintimeandspacetoascenariotermed“Global20-20-20”whereanincreasingnumberoftheworld’sregionsgraduallyadopttheEUpolicies.

InGlobal20-20-20weassumedanapproachwhichhasfourpolicyelementswithgraduallyincreasingrequirements:• GHGemissionslimit• RenewableEnergyStandard• BiofuelStandard• EnergyEfficiencyStandard

tothehighpenetrationofwindenergyandtheneedforbalancingdemandandsupplyeverywhereinthesystem.Theamountsofnewtransmissioncapacityare60GW,96GWand108GWforthe650ppm,the450ppmandtheGlobal20-20-20scenarios,respectively.Toputthesenumbersintoperspective,theinitialtransfercapacitybetweenEuropeancountriesisaround67GWtoday.

ThecurrentelectricitydemandinChinaisalreadyhigherthanestimatedintheGCAMscenarios,whicharetunedto2005asbaseyear.Nuclearandrenewablepowergenerationcan’tfullymeettherapidgrowthofdemandduetotheconstraintsofavailableresources.Thus,coal-firedpowergenerationwillstillmaintainarapidgrowthmomentuminChinaduringtheperiod2010-2020,andwillmaintain the position as the power generation technology with the largest total installed capacity and highest energy production.However,duetoextensivemodernizationanduseoflarger-scaleunits,itispossibletolimittheCO2 emissionsfromtheChinesepowerindustry.

Linking different energy system modelsTheoriginalambitionintheLinkSprojectwastosoft-linkmultipleenergysystemmodelswithdifferenttechnological,spatialandtemporalresolution,anditeratetheseintoasufficientconvergenceinselectedregions.

ByrunningGCAMastheglobal“topmodel”itwaspossibletouselong-termresultsasinputfortheregionalmodels,typically CO2prices,fuelpricesanddemand.However,iteratingforconvergenceturnedouttobeabiggerchallengethananticipated.EvenbiggerchallengeswereencounteredwhenwetriedtoiterateinatrianglebetweenregionalelectricityandgasmodelsunderglobalGCAMprojections.Weeventuallyabandonedtheapproachofconvergenceforatriangleofmodels.

InthecaseofEurope,wecomparedtwodifferentmodelsforlong-termexpansionoftheelectricitysystem;EMPIREandEMPSexpandedwithaninvestmentalgorithm.Theformermodel has a more mathematically stringent investment algorithmwhilethelatterhasamuchbetterrepresentationofvariablerenewablegenerationinEurope.

Fromthepresentanalysis,itisnotpossibletoconcludethatoneresultismore“correct”thattheothersincethereisnosystematicdifferencebetweentheresultsfromthetwomodels.TheresultsoftheEMPIREmodelaresensitivetothechoiceofstatisticalyearforwindandsolarresources.Theresultsaresufficientlysimilartoindicatethateithermodelwouldbeafeasibletooltouseforelectricitysystemexpansionplanningina50-yearperspective.

Linking policy analysis and energy modellingWeperformedthelinkingofpolicyandmodellinginseveralstages:1) SpecificpolicymeasureswereintroducedinGCAM.2) ResultsfromtheGCAManalysesweretakenasinputto the regional models. 3) Resultsfromtheregionalmodelswherediscussedina policy context.

Inparticular,theGlobal20-20-20scenarioisaninterestingexampleofanapproachthatcouldyieldreasonablyhighemissionsreductions.Themainconclusionisthatbottom-up,regionallyindependentpolicymeasurescouldyieldsignificantclimatechangemitigationresultsasanalternativetoasingleglobalcarbonmarket.Further,wediscussedhowfeasiblethespecific20-20-20measureswouldbeintheregionsofUSA,EUandChina.

Threemainstepsshouldbeconsideredwhenevaluatinghowaspecificregioncancontributewithclimatechangemitigationefforts:

1. Identifytheanchorageofregionalclimatepolicies• Fromwhichpolicyleveldothe(climate)policyinitiatives intheregionstem?• Thepolicyanchoragemightindicatepoliticalwilland priority.

Research tasks in the LinkS project.

2. Linkageandco-benefitsofclimatepolicies• Are climate policy initiatives linked to other relevant policy fields?Arethereanypotentialco-benefits?• Systematicanalysisandoverviewoveraregion’sclimate- specificandclimate-relevantpoliciesmayproducenew suggestionsofacceptableclimate-relevantpoliciesif climate-specific policies are controversial.

3. Interdependencies• Identifyeconomicandpoliticalinteractionandmutual dependenciesasapathforcommonsolutionsbothwithin andbetweenregions.

The benefits of LinkS in a broader contextOneofthemostinterestingresultsfromtheLinkSprojectisrelatedtothedesignandimplicationsoftheGlobal20-20-20scenario.AlthoughwehaveassumedthatallworldregionscopytheEU20-20-20policiesatdifferentpointsintimeinourscenario,eachregioncaninprincipledesignandintroducetheirownpoliciesindependentlyofeachother.Providedtheseregionalpoliciesaresufficientlystrongandcorrectlytimed,asetofindependentregionalpoliciesseemstogivealmostaslargeemissionsreductionsasaglobalcarbonmarketbutatasomewhathighersocio-economiccost.Thismaythereforebeafeasibleapproachintheabsenceofasingleglobalagreementandshouldbeconsideredforfutureglobalclimatenegotiations.

InthecaseofEurope,SINTEF’sEMPSmodelhasbeenexpandedbyanewinvestmentmoduleanddetaileddatasetshavebeenestablishedutto2060.Inaddition,anewmodelEMPIREhasbeendevelopedforlong-termdevelopmentstrategiesforthepowersystem.Therearestillpossibilitiesforimprovingthehandlingofvariablerenewablesourcesinthemodel,butitwillbeanimportantcontributiontofutureEuropeanpowersystemstudiesandfurtherR&Dprojectsforinfrastructuredevelopmenttools.

The 5 years of LinkS have given the opportunity to link several world-class research teams:• JointGlobalChangeResearchInstitute(JGCRI),Maryland, USA• DeptofCivilandEnvironmentalEngineering,Universityof Maryland,USA• CenterforIntegrativeEnvironmentalResearch(CIER), UniversityofMaryland,USA• Energy,EnvironmentandEconomyInstitute(3E),Tsinghua University,China• Dept.ofIndustrialEconomicsandTechnologyManagement, NTNU,Norway• Dept.ofElectricalPowerEngineering,NTNU,Norway•Market-GridAnalysisgroup,SINTEFEnergyResearch,Norway• PolicyandGovernancegroup,SINTEFEnergyResearch, Norway

Models:GCAM–GlobalChangeAssessmentModel,acommunitymodeloftheglobaleconomic,energy,agricultural,landuseandtechnologysystemsownedbyJointGlobalChangeResearchInstitute/PacificNorthwestNationalLaboratory.

http://wiki.umd.edu/gcam

EMPS–EFI’sMulti-areaPowermarketSimulator,acommercialmodelforlarge-scalehydro-thermalpowersystemschedulingownedbySINTEFEnergiAS

www.sintef.no/EMPS

EMPIRE–EuropeanModelforPowersystemInvestmentswithRenewableEnergy,anewmulti-stageinvestmentmodelfortheEuropeanpowersystemunderdevelopmentatNTNU.

Acknowledgements:ThepartnersgratefullyacknowledgethesupportfromHydroandtheResearchCouncilofNorway(R&DProjectAgreementno.190913/S60).

Contacts: • ResearchManagerBjørnHaraldBakken Bjorn.H.Bakken@sintef.no• ResearchScientistIngeborgGraabak Ingeborg.Graabak@sintef.no

Cumulative investments by 2050 in exchange corridors between countries in the Gobal 20-20-20 scenario.

EMPIRE EMPS

SINTEF Energi AS - SINTEF Energy Research Phone: + 4773 59 72 00 • energy.research@sintef.no • www.sintef.no/energy