ALBERT

Description: Buildings energy consumption is one of the most important contributors to GHG emissions worldwide, responsible for 23% of energy-related CO2 emissions. Decarbonising buildings energy demand will pass through two types of strategies: first through an overall reduction of energy demand, that could to some extent be reaped at negative costs; and second through a reduction of the carbon content of energy via fuel switching and supply side decarbonisation. This study assesses the contributions of each of these strategies for the decarbonisation of the buildings sector in line with a 1.5°C global warming. We show that in a 1.5°C scenario combining mitigation policies and a reduction of market failures in efficiency markets, 81% of the reductions in buildings emissions are achieved through the reduction of the carbon content of energy, while the remaining 19% are due to efficiency improvements which reduce energy demand by 31%. Without supply side decarbonisation, efficiency improvements almost entirely suppress the doubling of emissions that would otherwise be expected, but fail to induce an absolute decline in emissions. Our modelling and scenarios show the impact of both climate change mitigation policies and of the alleviation of market failures pervading through energy efficiency markets. The results show that the reduction of the carbon content of energy through fuel switching and supply-side decarbonisation is of paramount importance for the decarbonisation of buildings.

Description: The decarbonisation of industry is a bottleneck for EU's 2050 target of climate neutrality. Replacing fossil fuels with low-carbon electricity is at the core of this challenge; however, the aggregate electrification potential and resulting system-wide CO2 reductions for diverse industrial processes are unknown. Here, we present the results from a comprehensive bottom-up analysis of the energy use in eleven industrial sectors (accounting for 92% of Europe's industry CO2 emissions), and estimate the technological potential for industry electrification in three stages. 78% of the energy demand is electrifiable with technologies that are already established, while 99% electrification can be achieved with the addition of technologies currently under development. Such a deep electrification reduces CO2 emissions already based on the carbon intensity of today's electricity (~300 gCO2/kWhel). With an increasing decarbonisation of the power sector (IEA: 12 gCO2/kWhel in 2050), electrification could cut CO2 emissions by 78%, and almost entirely abate the energy-related CO2 emissions, reducing the industry bottleneck to only residual process emissions. Despite its decarbonisation potential, the extent to which direct electrification will be deployed in industry remains uncertain and depends on the relative cost of electric technologies compared to other low-carbon options.

Description: Die Kommission hat ihr “Fit For 55” Paket vorgelegt, welches das 55%-Reduktionsziel für 2030 wie folgt auf die Sektoren aufteilt: Die Sektoren im bestehenden EU-Emissionshandelssystem (ETS), also hauptsächlich Strom und Industrie, sollen ihre Emissionen um 61% gegenüber 2005 mindern. Alle anderen Sektoren fallen unter die Effort Sharing Regulation (ESR) und sollen ihre Emissionen um 40% gegenüber 2005 mindern. In diesem Papier analysieren wir die notwendigen CO2-Preise zur Zielerreichung unter der Annahme, dass eine Bepreisung von CO2 das einzige Instrument der Emissionsminderung ist. Werden weitere Politikinstrumente eingesetzt, zum Beispiel Technologiestandards, dann können zwar die CO2-Preise abgesenkt und die Verteilung der Vermeidungskosten auf Haushalte und Unternehmen verändert werden; jedoch kann das Niveau der gesamtwirtschaftlichen Vermeidungskosten nur dann vermindert werden, wenn die zusätzlichen Politikinstrumente bestehende Marktversagen verringern und dabei nicht mehr neue Ineffizienzen schaffen. Die notwendigen CO2-Preise im Jahre 2030 erreichen dabei 275 EUR/t in den ESR-Sektoren (Bandbreite: 210-405 EUR/t). Diese Preise sind mehr als doppelt so hoch wie die für das ETS-Ziel notwendigen CO2-Preise (130 EUR/t, Bandbreite 95-210 EUR/t). Allerdings wird die Höhe der notwendigen CO2-Preise maßgeblich davon beeinflusst, a) wie die Emissionsminderungen zwischen ETS und ESR aufgeteilt werden, b) wie schnell der Markthochlauf emissionsfreier Technologien – insbesondere der Elektromobilität – realisiert wird und wie schnell Wind- und Solarstrom ausgebaut, sowie die notwendigen Flexibilitäten im Stromsystem durch Netzausbau, Speicher und Lastmanagement bereitgestellt werden können. Für den Fall, dass der ETS 50% der zusätzlichen Minderungen des ESR übernimmt, gleichen sich beide Preise stark an: 190 EUR/t im ETS und 195 EUR/t in der ESR. Für die Politikinstrumente ergeben sich zwei Schlussfolgerungen: Ein höherer Vermeidungsbeitrag der ETS-Sektoren könnte die CO2-Preise angleichen, und somit das 2030-Ziel kostengünstiger erreichen. Allerdings könnte eine solche Aufteilung auch zu sehr hohen ESR-CO2-Preisen zu einem späteren Zeitpunkt führen, falls kurzfristig niedrigere CO2-Preise in den ESR-Sektoren den Markthochlauf emissionsfreier Technologien ausbremsen. Dies wird aber nur dann der Fall sein, wenn der langfristige Pfad der CO2-Preise von den Investoren als nicht glaubwürdig wahrgenommen wird. Die Kostenersparnisse hängen sowohl von den Erwartungen der Investoren als auch davon ab, welche zusätzlichen Maßnahmen noch auf europäischer und nationaler Ebene implementiert werden, die die Glaubwürdigkeit der langfristigen Zielerreichung stärken. Die große Bandbreite der notwendigen CO2-Preise je nach Annahmen zum Markthochlauf zeigt die Bedeutung von komplementärem Infrastrukturausbau und Technologiepolitik. So könnten beispielsweise der Ausbau der Ladeinfrastruktur und Investitionsanreize den Markthochlauf emissionsfreier Technologien fördern. Solche Maßnahmen – wie sie auch im Fit-for-55 Paket der EU Kommision vorgesehen sind – können bestehende Marktversagen korrigieren und so den notwendigen CO2-Preis senken sowie die Sicherheit der Klimazielerreichung erhöhen. Allerdings gehen diese Maßnahmen oftmals mit versteckten Kosten einher, und ein sozialer Ausgleich ist zudem schwerer möglich, da keine Einnahmen aus der CO2-Bepreisung zur Verfügung stehen.

Description: Dieses Kurzdossier analysiert die Auswirkungen der Energiekrise auf die Transformation des deutschen Energiesystems zur Klimaneutralität 2045 sowie Strategien zur Beseitigung der Abhängigkeit Deutschlands von russischen Erdgasimporten.

Description: Green hydrogen and derived electrofuels are attractive replacements for fossil fuels in applications where direct electrification is infeasible. While this makes them crucial for climate neutrality, rapidly scaling up supply is critical and challenging. Here we show that even if electrolysis capacity grows as fast as wind and solar power have done, green hydrogen supply will remain scarce in the short term and uncertain in the long term. Despite initial exponential growth, green hydrogen likely (≥75%) supplies 〈1% of final energy until 2030 in the European Union and 2035 globally. By 2040, a breakthrough to higher shares is more likely, but large uncertainties prevail with an interquartile range of 3.2–11.2% (EU) and 0.7–3.3% (globally). Both short-term scarcity and long-term uncertainty impede investment in hydrogen end uses and infrastructure, reducing green hydrogen’s potential and jeopardizing climate targets. However, historic analogues suggest that emergency-like policy measures could foster substantially higher growth rates, expediting the breakthrough and increasing the likelihood of future hydrogen availability.

Description: Cheap and abundant coal fuelled the industrialization of Europe, North America and Asia1. However, the price tag on coal has never reflected the external cost to society; coal combustion produces more than a third of today’s global CO2 emissions and is a major contributor to local adverse effects on the environment and public health, such as biodiversity loss and respiratory diseases. Here, we show that phasing out coal yields substantial local environmental and health benefits that outweigh the direct policy costs due to shortening of the energy supply. Phasing out coal is thus a no-regret strategy for most world regions, even when only accounting for domestic effects and neglecting the global benefits from slowing climate change. Our results suggest that these domestic effects potentially eliminate much of the free-rider problem caused by the discrepancy between the national burden of decarbonization costs and the internationally shared benefits of climate change impact mitigation. This, combined with the profound effect of closing around half of the global CO2 emissions gap towards the 2 °C target, makes coal phase-out policies attractive candidates for the iterative strengthening of the nationally determined contributions pledged by the countries under the Paris Agreement.

Description: The COVID-19 pandemic continues to strongly affect global energy systems. Global power sector CO2 emissions have shown a substantial decline, thanks to (a) the COVID-19-induced economic downturn and resulting reduction of electricity demand and (b) a decrease of carbon intensity of power generation as coal generation is decreased most strongly. These effects illustrate the opportunity for different policies to support a structural and accelerating decline of power sector emissions.

Description: E-fuels promise to replace fossil fuels with renewable electricity without the demand-side transformations required for a direct electrification. However, e-fuels’ versatility is counterbalanced by their fragile climate effectiveness, high costs and uncertain availability. E-fuel mitigation costs are €800–1,200 per tCO2. Large-scale deployment could reduce costs to €20–270 per tCO2 until 2050, yet it is unlikely that e-fuels will become cheap and abundant early enough. Neglecting demand-side transformations threatens to lock in a fossil-fuel dependency if e-fuels fall short of expectations. Sensible climate policy supports e-fuel deployment while hedging against the risk of their unavailability at large scale. Policies should be guided by a ‘merit order of end uses’ that prioritizes hydrogen and e-fuels for sectors that are inaccessible to direct electrification.

Description: The Paris Agreement calls for a cooperative response with the aim of limiting global warming to well below two degrees Celsius above pre-industrial levels while reaffirming the principles of equity and common, but differentiated responsibilities and capabilities1. Although the goal is clear, the approach required to achieve it is not. Cap-and-trade policies using uniform carbon prices could produce cost-effective reductions of global carbon emissions, but tend to impose relatively high mitigation costs on developing and emerging economies. Huge international financial transfers are required to complement cap-and-trade to achieve equal sharing of effort, defined as an equal distribution of mitigation costs as a share of income2,3, and therefore the cap-and-trade policy is often perceived as infringing on national sovereignty2–7. Here we show that a strategy of international financial transfers guided by moderate deviations from uniform carbon pricing could achieve the goal without straining either the economies or sovereignty of nations. We use the integrated assessment model REMIND–MAgPIE to analyse alternative policies: financial transfers in uniform carbon pricing systems, differentiated carbon pricing in the absence of financial transfers, or a hybrid combining financial transfers and differentiated carbon prices. Under uniform carbon prices, a present value of international financial transfers of 4.4 trillion US dollars over the next 80 years to 2100 would be required to equalize effort. By contrast, achieving equal effort without financial transfers requires carbon prices in advanced countries to exceed those in developing countries by a factor of more than 100, leading to efficiency losses of 2.6 trillion US dollars. Hybrid solutions reveal a strongly nonlinear trade-off between cost efficiency and sovereignty: moderate deviations from uniform carbon prices strongly reduce financial transfers at relatively small efficiency losses and moderate financial transfers substantially reduce inefficiencies by narrowing the carbon price spread. We also identify risks and adverse consequences of carbon price differentiation due to market distortions that can undermine environmental sustainability targets8,9. Quantifying the advantages and risks of carbon price differentiation provides insight into climate and sector-specific policy mixes.

Description: Ambitious climate policies, as well as economic development, education, technological progress and less resource-intensive lifestyles, are crucial elements for progress towards the UN Sustainable Development Goals (SDGs). However, using an integrated modelling framework covering 56 indicators or proxies across all 17 SDGs, we show that they are insufficient to reach the targets. An additional sustainable development package, including international climate finance, progressive redistribution of carbon pricing revenues, sufficient and healthy nutrition and improved access to modern energy, enables a more comprehensive sustainable development pathway. We quantify climate and SDG outcomes, showing that these interventions substantially boost progress towards many aspects of the UN Agenda 2030 and simultaneously facilitate reaching ambitious climate targets. Nonetheless, several important gaps remain; for example, with respect to the eradication of extreme poverty (180 million people remaining in 2030). These gaps can be closed by 2050 for many SDGs while also respecting the 1.5 °C target and several other planetary boundaries.