Markus Amann
Atmospheric Pollution and Economic Development ProgrammeInternational Institute for Applied Systems Analysis

Comparison of GHG mitigation efforts
between Annex 1 countries

Objectives• Independent and coherent comparison ofGHG mitigation potentials and costs
in Annex 1 countries for 2020
– using a systems approach,– based on publicly available data,– taking into account co-benefits on air pollution,– independent assessment, financed through IIASA’s core funds.

• Results, input data and interactive calculator freely
available in the public domain:
http://gains.iiasa.ac.atMethodology

Bottom-up approach• at detailed technical level,• all gases and sectors,• systems approach,• starting from IEA, FAO projections of economic activities,• technical, economic and market potentials (before trading).
Based on earlier work with IIASA’s GAINS (Greenhouse gas –Air pollution Interactions and Synergies) modelDisaggregation of emission sourcesin domestic and industry sectors• Domestic sector:– Residential/Commercial energy use,
– Heating+ventilation+AC/Water heating/Cooking/Lighting/Large appliances/Small appliances,– Up to 10 climate regions,– Flats/Single family houses,– Built before/after 2010

• Industry:– 6 sectors:
Iron and steel, Non-ferrous metals, Non-metal minerals,Chemicals, Pulp and paper, Other industries– For each sector up to 13 products:(e.g., Raw steel, Finished products, Scrap supply, Coke oven coke, Sinter,Pellets, Pig iron, Direct reduced iron, Open hearth furnace, Basic oxygen,
Electric arc furnace, Casting, rolling finishing, Thin slab casting)Estimating mitigation potentials
Four stepsa) Inventory of ~300 mitigation measures, with technical andeconomic featuresMitigation measures~300 options in each country

Structural measures

CO2 measures

N2O measures

F-gas measures
CH4 measures

Estimating mitigation potentials
Four stepsa) Inventory of ~300 mitigation measures, with technical andeconomic features
For each source sector in each country:b) For 2005: Match emissions reported to UNFCCC– with activity data from UNFCCC, IEA and national statistics,– adjust implementation rates of mitigation measures.

Estimating mitigation potentials
Four stepsa) Inventory of ~300 mitigation measures, with technical andeconomic features
For each source sector in each country:b) For 2005: Match emissions reported to UNFCCCc) For 2020:• Match baseline energy use of IEA World Energy Outlook 2008
- with activity rates projected by IEA,
modify implementation rates of energy efficiency measures
to reproduce IEA energy projection.
• Develop baseline emission projection- adjust implementation rates of mitigation measures asreported in National Communications.

Estimating mitigation potentials
Four stepsa) Inventory of ~300 mitigation measures, with technicaland economic features
For each source sector in each country:b) For 2005: Match emissions reported to UNFCCCc) For 2020: Match baseline energy use and develop
baseline emission projectiond) Determine further mitigation potential– from implementing the best available (energy efficiency andC mitigation) measures that are not assumed in the baseline,– considering constraints on replacement of existing capitalstock, structural limits, etc.

Estimating mitigation costs
Three steps:

1. Determine unit costs for each mitigation option:–

Annualized investments + operating costs – savings per unit ofreduced emissions–

Reflect resource costs without transfers(no taxes, subsidies, profits, transaction costs, etc.)–Alternative interest rates for annualization of investments:•Social (4%/yr)•Private (20%/yr)

2. For a given mitigation target:-Determine least-cost portfolio of mitigation measures(i.e., including upstream effects), through optimization model

3. Cost curves: Series of optimizations between baseline emissions
and maximum mitigation caseAn initial implementation• For largest Annex 1 countries (98% of 1990 emissions),
EU25 presented in aggregate• Based on activity projections ofIEA World Energy Outlook 2008 andFAO World Agriculture Perspective• Key assumptions:–––––

Only currently available technologies
Natural turnover of capital stock, no premature scrapping
No behavioural changes
Before trading
LULUCF excluded for now• Initial analysis based on publicly available information,
received only limited review by national experts

Baseline GHG emissions projections
for IEA WEO2008 projection

Emissions relative to 1990

160%
Australia
New Zealand

140%

Canada120%

Norw ay
United States of America

100%

Sw itzerland
Japan

80%

Annex-I
EU2760%Russian FederationUkraine40%
19902005Year2020Analysis not completed yet for: Belarus, Croatia, Turkey, Cyprus, MaltaMarginal cost curves for individual Parties

JapanEU27USARussia

Interest rate: 20%

Total costs for different interest rates
Annex 1, 2020, excl. LULUCF

Total cost (% of GDP2020)

0.4%

20%
10%

0.2%

0.0%
10%

4%

5%

0%

-5%

-10%-15%-0.2%
Emissions relative to 1990

-20%-25%

Total cost curves (% of GDP)
(10% interest rate)

Total cost (share of GDP2020)

AUS NZ CA NO US CH JP EU
RU

0.4%

UKR

0.3%
0.2%
0.1%
0.0%
-0.1%-0.2%50%40%

30%20%

10%0%-10% -20% -30% -40% -50% -60%Emissions relative to 1990

Comparison of mitigation efforts
for a 16.5% reduction of total Annex 1 emissions
Efficiency vs. equity
Change Perto 1990 capita

Carbon Costs Costs perprice% GDP capita

Carbon Costs Costs perprice% GDP capita

Change Perto 1990 capita

Carbon Costs Costs perprice% GDP capita

AUCAEU
JP
NZ
NO
RU
CH
UKR
USAUCA
EU
JP
NZNO
RU
CH
UKR
US

Change Perto 1990 capita
AUCAEUJP
NZNO
RUCH
UKR
US

Change Perto 1990 capita

Carbon Costs Costs perprice% GDP capita
AUCAEUJPNZNORUCHUKRUS

Co-benefits on air pollutant emissions

Emissions Air Pollutants
relative to Baseline 2020

0%SO2NOX
PM2.5-5%-10%-15%
5%Annex I2020
Interest rate: 20%

0%-5%-10%

GHG emissions (relative to 1990)-15%

Access to more information (1)http://gains.iiasa.ac.at• Data sheets on GHG
mitigation potentials
for all Annex 1 Parties

Access to more information (2)http://gains.iiasa.ac.atDocumentation of methodology:•Basic GAINS methodology(M. Amann et al., 2008)•Mitigation potentials fromenergy use and industry(J. Cofala et al., 2008)•Mitigation potentials fromtransportation (J. Borken-Kleefeldet al., 2008)•

Mitigation potentials for
non-CO2 gases(L. Höglund-Isaksson et al., 2008)•

Mitigation potentials from LULUCF(H. Böttcher et al., 2008)

Access to more information (3)http://gains.iiasa.ac.at• On-line calculator on the Internet:

Access to more information (4)http://gains.iiasa.ac.at

Review workshop:
March 16-18, 2009 at IIASARegistration:
http://gains.iiasa.ac.at

Conclusions• IIASA’s GAINS analysis:– Coherent impartial comparison of mitigation efforts– Analysis based on publicly available data
– Transparency: Open access to results and all input data:
http://gains.iiasa.ac.at• There are objective reasons for differences in mitigation efforts.
• Different equity criteria deliver different rankings of countries.
• Political agreement on the meaning of comparability of efforts
is required.
• The GAINS analysis provides a quantitative tool for suchnegotiations.