U.S. CO2 Mitigation in a Global Context: Welfare, Trade and Land Use

We describe carbon dioxide mitigation scenarios specified by the Energy Modeling Forum study (EMF-24) “U.S. Technology Transitions under Alternative Climate Policies,†using a global computable general equilibrium model that simulates world energy and agricultural systems through 2050. One set of scenarios covers variation across five major technology groups: end-use technology, carbon dioxide capture and storage, nuclear electricity generation, wind and solar power, and bioenergy. Other scenarios cover variation across policies. Policies such as a renewable portfolio standard for electricity generation or a clean electricity standard have the potential for significant emissions reductions, but at a greater cost than a cap-and-trade scenario with the same reduction in emissions. Cap-and-trade scenarios resulted in carbon dioxide leakage rates of 11 to 20 percent depending on the stringency of the targets. Oil-exporting regions without a mitigation policy may still have significant welfare losses when other world regions reduce emissions.