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851. Clean Coal: U.S.-China Cooperation in Energy Security

Author:
David Wendt
Publication Date:
05-2008
Content Type:
Policy Brief
Institution:
EastWest Institute
Abstract:
As major consumers of the world's energy resources, the United States and China are in dire need of secure energy solutions that can keep pace with their large appetites for energy. Enter coal. Both countries possess abundant coal reserves measured in the hundreds of billions of tons. But the approach to coal policy has been one of favoring cheap extraction rather than taking into serious consideration the societal costs of coal. For the United States, coal represents a major source of electrical power—and a major source of pollution. In China, the accessibility of coal has overtaken the environmental and health arguments against its widespread use. China uses more coal than the United States and European Union combined. The damaging side effects of coal mining and consumption have been overlooked in the face of easy availability and undeveloped or less accessible alternatives. In the current context of global energy uncertainty, coal has been forgiven much.
Topic:
Climate Change, Energy Policy, Environment, Treaties and Agreements, and International Affairs
Political Geography:
United States and China

852. The sting of climate change

Author:
Sarah Potter
Publication Date:
11-2008
Content Type:
Policy Brief
Institution:
Lowy Institute for International Policy
Abstract:
Global climate change will intensify the already significant malaria and dengue problems in maritime Southeast Asia and the Pacific Islands. Those countries with the fewest resources and poor public health infrastructure are likely to feel the impact of increasing disease the most acutely. Australia itself is a 'fringe country' to the expanding endemic zone of mosquito-borne diseases to its north. Climate change may well make more of northern Australia more vulnerable to malaria and dengue outbreaks.
Topic:
Climate Change, Environment, and Health
Political Geography:
Asia and Australia/Pacific

853. The Economics of CO2 Mitigation: the Stern Review and its critics

Author:
Marilyn Power
Publication Date:
01-2008
Content Type:
Working Paper
Institution:
The New School Graduate Program in International Affairs
Abstract:
The debate surrounding Global Warming and potential policies to curve its consequences has been ever-growing in noise and status. Sir Nicholas Stern's Review on the Economics of Climate Change in 2006 stimulated more debate and research with its conclusions of immediate policy action based on cost-benefit techniques; its critics coming from both the mainstream and ecological economic backgrounds. This paper will examine Stern Review's use of discounting in environmental cost-benefit analysis, its critiques, and possible alternatives to analyze the economic understandings of global warming. And, in the end, it will tie together the above economics to the political atmosphere of today.
Topic:
Climate Change, Economics, Globalization, and Political Economy

854. Expecting the Unexpected: Macroeconomic Volatility and Climate Policy

Author:
Warwick J. McKibbin, Adele Morris, and Peter J. Wilcoxen
Publication Date:
11-2008
Content Type:
Working Paper
Institution:
The Brookings Institution
Abstract:
To estimate the emissions reductions and costs of a climate policy, analysts usually compare a policy scenario with a baseline scenario of future economic conditions without the policy. Both scenarios require assumptions about the future course of numerous factors such as population growth, technical change, and non-climate policies like taxes. The results are only reliable to the extent that the future turns out to be reasonably close to the assumptions that went into the model.
Topic:
Climate Change, Development, Economics, and Energy Policy

855. Technological Scarcity, Compliance Flexibility and the Optimal Time Path of Emissions Abatement

Author:
Bryan K. Mignone
Publication Date:
11-2008
Content Type:
Working Paper
Institution:
The Brookings Institution
Abstract:
The overall economic efficiency of a quantity-based approach to greenhouse gas mitigation depends strongly on the extent to which such a program provides opportunities for compliance flexibility, particularly with regard to the timing of emissions abatement. Here I consider a program in which annual targets are determined by choosing the optimal time path of reductions consistent with an exogenously prescribed cumulative reduction target and fixed technology set. I then show that if the availability of low-carbon technology is initially more constrained than anticipated, the optimal reduction path shifts abatement toward later compliance periods. For this reason, a rigid policy in which fixed annual targets are strictly enforced in every year yields a cumulative environmental outcome identical to the optimal policy but an economic outcome worse than the optimal policy. On the other hand, a policy that aligns actual prices (or equivalently, costs) with expected prices by simply imposing an explicit price ceiling (often referred to as a "safety valve") yields the opposite result. Comparison among these multiple scenarios implies that there are significant gains to realizing the optimal path but that further refinement of the actual regulatory instrument will be necessary to achieve that goal in a real cap-and-trade system.
Topic:
Climate Change, Economics, and Environment

856. Prices in Emissions Permit Markets: The Role of Investor Foresight and Capital Durability

Author:
Bryan K. Mignone
Publication Date:
11-2008
Content Type:
Working Paper
Institution:
The Brookings Institution
Abstract:
Of the many regulatory responses to climate change, cap-and-trade is the only one currently endorsed by large segments of the scientific, economic and political establishments. Under this type of system, regulators set the overall path of carbon dioxide (CO2) reductions, allocate or auction the appropriate number of emissions allowances to regulated entities and – through trading – allow the market to converge upon the least expensive set of abatement opportunities. As a result, the trading price of allowances is not set by the regulator as it would be under a tax system, but instead evolves over time to reflect the underlying supply and demand for allowances. In this paper, I develop a simple theory that relates the initial clearing price of CO2 allowances to the marginal cost premium of carbon-free technology, the maximum rate of energy capital replacement and the market interest rate. This theory suggests that the initial clearing price may be lower than the canonical range of CO2 prices found in static technology assessments. Consequently, these results have broad implications for the design of a comprehensive regulatory solution to the climate problem, providing, for example, some intuition about the proper value of a possible CO2 price trigger in a future cap-and-trade system.
Topic:
Climate Change, Economics, Environment, and Markets

857. What do we know about the economics of adaptation?

Author:
Asbjørn Aaheim and Marianne Aasen
Publication Date:
02-2008
Content Type:
Policy Brief
Institution:
Centre for European Policy Studies
Abstract:
An attempt to summarise the state of knowledge about social and economic challenges related to climate change, for example based on the latest IPCC reports, would probably give the impression that impacts, adaptation and vulnerability are a question of interactions between people and institutions within small local communities (IPCC, 2007a), whereas mitigation can be addressed by political analyses and economics (IPCC, 2007b). In most economic studies, the motivation behind mitigation is presented as that of limiting greenhouse gas emissions to a given target
Topic:
Climate Change, Economics, and Energy Policy
Political Geography:
Europe

858. Adaptation and Mainstreaming of EU Climate Change Policy: An Actor-Based Perspective

Author:
Darryn McEvoy, Kate Lonsdale, and Piotr Matczak
Publication Date:
02-2008
Content Type:
Policy Brief
Institution:
Centre for European Policy Studies
Abstract:
Adaptation to climate change (in comparison to the mitigation agenda) is a relatively new focus for both research and policy communities. Drawing from ongoing 'actor-based' research being carried out for the ADAM project, this briefing paper reports on the knowledge base being developed through a process of engagement with experts and key stakeholders across a variety of countries, landscape types, sectors, institutions and actors. The concluding discussion then focuses on some of the implications of these early findings for both EU policy and decision-making more generally.
Topic:
Climate Change, Energy Policy, and Environment
Political Geography:
Europe

859. What lessons can be learned from the EU emissions trading scheme?

Author:
Christian Egenhofer and Noriko Fujiwara
Publication Date:
02-2008
Content Type:
Policy Brief
Institution:
Centre for European Policy Studies
Abstract:
The EU emissions trading scheme (EU ETS) is designed to help EU member states achieve their commitments to limit or reduce greenhouse gas (GHG) emissions in a cost-effective way. It was not meant to work as a stand-alone tool but as part of the package of abatement measures across the board. It is a cap-and-trade system. Member states first impose caps on GHG emissions – initially only CO2 until 2012 – from installations in specified sectors, mainly the power sector and industry subsectors (e.g. steel, cement, glass, paper and pulp). Emissions from these sectors amount to 40% of total EU emissions. Next, they allocate allowances to installations. Each installation surrenders a number of allowances equal to the total emissions from that installation during the preceding year.
Topic:
Climate Change, Economics, and Environment
Political Geography:
Europe

860. Adaptation to Climate Change: Why is it needed and how can it be implemented?

Author:
Christian Egenhofer, Asbjørn Aaheim, Darryn McEvoy, Frans Berkhout, Reinhard Mechler, Henry Neufeldt, Anthony Patt, Paul Watkiss, Anita Wreford, Zbigniew Kundzewicz, and Carlo Lavalle
Publication Date:
06-2008
Content Type:
Policy Brief
Institution:
Centre for European Policy Studies
Abstract:
This Policy Brief provides a first overview of the state of ADAM research that was discussed during the first ADAM-CEPS seminar on 12 October 2007. It brought together academic experts, policy-makers and the civil society to discuss adaptation issues and (preliminary) ADAM research results.
Topic:
Climate Change, Environment, and Regional Cooperation
Political Geography:
Europe