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Benefits of low carbon development in a developing country: Case of Nepal

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  • Shrestha, Ram M.
  • Shakya, Shree Raj

Abstract

This paper analyzes the direct and indirect benefits of reducing CO2 emission during 2005 to 2100 in the case of Nepal, a low income developing country rich in hydropower resource. It discusses the effects on energy supply mix, local pollutant emissions, energy security and energy system costs of CO2 emission reduction targets in the country by using an energy system model based on the MARKAL framework. The study considers three cases of CO2 emission reduction targets and analyzes their benefits during the study period as compared to the reference scenario. The first two cases consist of a 20% cutback (Scenario ERT20) and 40% cutback (Scenario ERT40) (of CO2 emission in the reference scenario). The third case considers a 40% cutback of CO2 emission with the share of electric mass transport (EMT) in the land transport service demand increased to 30% (as compared to 20% in the reference scenario). The study shows that an implementation of Scenario ERT40 would increase the cumulative electricity generation (mainly from hydropower) by 16.5% (794 TWh), reduce the cumulative consumption of imported fuels by 42% (24,400 PJ) and increase the total energy system cost by 1.6% during 2005 to 2100 as compared to the reference scenario. Besides, there would be a reduction in the emission of local pollutants and generation of additional employment in the country. With the share of EMT increased to 30%, there would be a further reduction in local pollutant emissions, an improvement in energy security and a decrease in the energy system cost compared to that in Scenario ERT40.

Suggested Citation

  • Shrestha, Ram M. & Shakya, Shree Raj, 2012. "Benefits of low carbon development in a developing country: Case of Nepal," Energy Economics, Elsevier, vol. 34(S3), pages 503-512.
    • Handle: RePEc:eee:eneeco:v:34:y:2012:i:s3:p:s503-s512
    DOI: 10.1016/j.eneco.2012.03.014
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    2. Calvin, Katherine & Clarke, Leon & Krey, Volker & Blanford, Geoffrey & Jiang, Kejun & Kainuma, Mikiko & Kriegler, Elmar & Luderer, Gunnar & Shukla, P.R., 2012. "The role of Asia in mitigating climate change: Results from the Asia modeling exercise," Energy Economics, Elsevier, vol. 34(S3), pages 251-260.
    3. Lin, Boqiang & Raza, Muhammad Yousaf, 2020. "Analysis of energy security indicators and CO2 emissions. A case from a developing economy," Energy, Elsevier, vol. 200(C).
    4. Rubio-Varas, Mar & Muñoz-Delgado, Beatriz, 2017. "200 years diversifying the energy mix? Diversification paths of the energy baskets of European early comers vs. latecomers," Working Papers in Economic History 2017/01, Universidad Autónoma de Madrid (Spain), Department of Economic Analysis (Economic Theory and Economic History).
    5. Anwar, Javed, 2016. "Analysis of energy security, environmental emission and fuel import costs under energy import reduction targets: A case of Pakistan," Renewable and Sustainable Energy Reviews, Elsevier, vol. 65(C), pages 1065-1078.
    6. Pradhan, Bijay B. & Limmeechokchai, Bundit & Shrestha, Ram M., 2019. "Implications of biogas and electric cooking technologies in residential sector in Nepal – A long term perspective using AIM/Enduse model," Renewable Energy, Elsevier, vol. 143(C), pages 377-389.
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    11. Sarica, Kemal & Tyner, Wallace E., 2013. "Alternative policy impacts on US GHG emissions and energy security: A hybrid modeling approach," Energy Economics, Elsevier, vol. 40(C), pages 40-50.
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    More about this item

    Keywords

    GHG emission reduction target; Low carbon development co-benefits; Electric mass transport; Energy security; Hydropower development; Developing country;
    All these keywords.

    JEL classification:

    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East
    • Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water
    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects
    • Q52 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Pollution Control Adoption and Costs; Distributional Effects; Employment Effects
    • Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
    • R49 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Other

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