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Environmental and economic effects of the Copenhagen pledges and more ambitious emission reduction targets

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  • Peterson, Everett B.
  • Schleich, Joachim
  • Duscha, Vicki

Abstract

A multi-region, multi-sector dynamic computable general equilibrium model is applied to explore the economic and welfare effects of the pledges submitted by developed countries (Annex I countries) and major developing (non-Annex I) countries for 2020 under the Copenhagen Accord. In addition to analyzing scenarios reflecting the upper and lower bounds of the Copenhagen Pledges, one additional policy scenario where Annex I countries as a group reduce CO2-emissions by 30% in 2020 compared to 1990 levels, and where major non-Annex I countries reduce CO2 emissions 15% below baseline, is also analyzed. Economic effects are measured as changes in GDP compared to baseline and welfare effects are measured via the equivalent variation. Assuming that countries with emission targets may trade certificates, average reductions in GDP for countries with targets range between 0.1% and 0.7% in 2020 for the policy scenarios. While the GDP losses are larger for major non-Annex I countries with emission targets compared to Annex I countries, this is not the case for the changes in welfare. With the exception of Mexico, the welfare losses for the major non-Annex I regions, as a percentage of projected GDP in 2020, are lower than for the large Annex I countries.

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  • Peterson, Everett B. & Schleich, Joachim & Duscha, Vicki, 2011. "Environmental and economic effects of the Copenhagen pledges and more ambitious emission reduction targets," Energy Policy, Elsevier, vol. 39(6), pages 3697-3708, June.
    • Handle: RePEc:eee:enepol:v:39:y:2011:i:6:p:3697-3708
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    8. Lim, Jaekyu, 2011. "Impacts and implications of implementing voluntary greenhouse gas emission reduction targets in major countries and Korea," Energy Policy, Elsevier, vol. 39(9), pages 5086-5095, September.
    9. A. F. Hof & M. G. J. Elzen & A. Mendoza Beltran, 2016. "The EU 40 % greenhouse gas emission reduction target by 2030 in perspective," International Environmental Agreements: Politics, Law and Economics, Springer, vol. 16(3), pages 375-392, June.
    10. Francesco Bosello & Lorenza Campagnolo & Carlo Carraro & Fabio Eboli & Ramiro Parrado & Elisa Portale, 2013. "Macroeconomic Impacts of the EU 30% GHG Mitigation Target," Working Papers 2013.28, Fondazione Eni Enrico Mattei.
    11. Olivia Ricci & Sandrine Selosse, 2013. "A cost analysis of the Copenhagen emission reduction pledges," Economics Bulletin, AccessEcon, vol. 33(1), pages 764-771.
    12. Delpiazzo, Elisa & Parrado, Ramiro & Standardi, Gabriele, 2017. "Extending the Public Sector in the ICES Model with an Explicit Government Institution," EIA: Climate Change: Economic Impacts and Adaptation 254041, Fondazione Eni Enrico Mattei (FEEM).
    13. Peterson, Everett B. & Schleich, Joachim & Duscha, Vicki, 2012. "Sectoral Targets as a Means to Reduce Global Carbon Emissions," Conference papers 332200, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    14. Wada, Kenichi & Sano, Fuminori & Akimoto, Keigo & Homma, Takashi, 2012. "Assessment of Copenhagen pledges with long-term implications," Energy Economics, Elsevier, vol. 34(S3), pages 481-486.
    15. John Byrne & Lado Kurdgelashvili & Job Taminiau, 2012. "Social change to avert further climate change: defining the scale of change and principles to guide a new strategy," Wiley Interdisciplinary Reviews: Energy and Environment, Wiley Blackwell, vol. 1(1), pages 17-40, July.
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