IDEAS home Printed from https://ideas.repec.org/p/arx/papers/1710.11019.html
   My bibliography  Save this paper

Simulating the deep decarbonisation of residential heating for limiting global warming to 1.5C

Author

Listed:
  • Florian Knobloch
  • Hector Pollitt
  • Unnada Chewpreecha
  • Vassilis Daioglou
  • Jean-Francois Mercure

Abstract

Whole-economy scenarios for limiting global warming to 1.5C suggest that direct carbon emissions in the buildings sector should decrease to almost zero by 2050, but leave unanswered the question how this could be achieved by real-world policies. We take a modelling-based approach for simulating which policy measures could induce an almost-complete decarbonisation of residential heating, the by far largest source of direct emissions in residential buildings. Under which assumptions is it possible, and how long would it take? Policy effectiveness highly depends on behavioural decision- making by households, especially in a context of deep decarbonisation and rapid transformation. We therefore use the non-equilibrium bottom-up model FTT:Heat to simulate policies for a transition towards low-carbon heating in a context of inertia and bounded rationality, focusing on the uptake of heating technologies. Results indicate that the near-zero decarbonisation is achievable by 2050, but requires substantial policy efforts. Policy mixes are projected to be more effective and robust for driving the market of efficient low-carbon technologies, compared to the reliance on a carbon tax as the only policy instrument. In combination with subsidies for renewables, near-complete decarbonisation could be achieved with a residential carbon tax of 50-200Euro/tCO2. The policy-induced technology transition would increase average heating costs faced by households initially, but could also lead to cost reductions in most world regions in the medium term. Model projections illustrate the uncertainty that is attached to household behaviour for prematurely replacing heating systems.

Suggested Citation

  • Florian Knobloch & Hector Pollitt & Unnada Chewpreecha & Vassilis Daioglou & Jean-Francois Mercure, 2017. "Simulating the deep decarbonisation of residential heating for limiting global warming to 1.5C," Papers 1710.11019, arXiv.org, revised May 2018.
  • Handle: RePEc:arx:papers:1710.11019
    as

    Download full text from publisher

    File URL: http://arxiv.org/pdf/1710.11019
    File Function: Latest version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Mercure, J.-F. & Pollitt, H. & Chewpreecha, U. & Salas, P. & Foley, A.M. & Holden, P.B. & Edwards, N.R., 2014. "The dynamics of technology diffusion and the impacts of climate policy instruments in the decarbonisation of the global electricity sector," Energy Policy, Elsevier, vol. 73(C), pages 686-700.
    2. Jean-François Mercure, 2015. "An age structured demographic theory of technological change," Journal of Evolutionary Economics, Springer, vol. 25(4), pages 787-820, September.
    3. Geels, Frank W., 2002. "Technological transitions as evolutionary reconfiguration processes: a multi-level perspective and a case-study," Research Policy, Elsevier, vol. 31(8-9), pages 1257-1274, December.
    4. Achtnicht, Martin & Madlener, Reinhard, 2014. "Factors influencing German house owners' preferences on energy retrofits," Energy Policy, Elsevier, vol. 68(C), pages 254-263.
    5. Olsthoorn, Mark & Schleich, Joachim & Gassmann, Xavier & Faure, Corinne, 2017. "Free riding and rebates for residential energy efficiency upgrades: A multi-country contingent valuation experiment," Energy Economics, Elsevier, vol. 68(S1), pages 33-44.
    6. Alan P. Kirman, 1992. "Whom or What Does the Representative Individual Represent?," Journal of Economic Perspectives, American Economic Association, vol. 6(2), pages 117-136, Spring.
    7. Jerry A. Hausman, 1979. "Individual Discount Rates and the Purchase and Utilization of Energy-Using Durables," Bell Journal of Economics, The RAND Corporation, vol. 10(1), pages 33-54, Spring.
    8. Arthur, W Brian, 1989. "Competing Technologies, Increasing Returns, and Lock-In by Historical Events," Economic Journal, Royal Economic Society, vol. 99(394), pages 116-131, March.
    9. J. -F. Mercure & H. Pollitt & A. M. Bassi & J. E Vi~nuales & N. R. Edwards, 2015. "Modelling complex systems of heterogeneous agents to better design sustainability transitions policy," Papers 1506.07432, arXiv.org, revised Feb 2016.
    10. van Ruijven, Bas J. & van Vuuren, Detlef P. & de Vries, Bert J.M. & Isaac, Morna & van der Sluijs, Jeroen P. & Lucas, Paul L. & Balachandra, P., 2011. "Model projections for household energy use in India," Energy Policy, Elsevier, vol. 39(12), pages 7747-7761.
    11. Mercure, Jean-François, 2018. "Fashion, fads and the popularity of choices: Micro-foundations for diffusion consumer theory," Structural Change and Economic Dynamics, Elsevier, vol. 46(C), pages 194-207.
    12. Hecher, Maria & Hatzl, Stefanie & Knoeri, Christof & Posch, Alfred, 2017. "The trigger matters: The decision-making process for heating systems in the residential building sector," Energy Policy, Elsevier, vol. 102(C), pages 288-306.
    13. F. Knobloch & J. -F. Mercure, 2016. "The behavioural aspect of green technology investments: a general positive model in the context of heterogeneous agents," Papers 1603.06888, arXiv.org.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Stéphane Poncin, 2018. "Energy policy tools in Luxembourg - Assessing their impact on households’ space heating energy consumption and CO2 emissions by means of the LuxHEI model," DEM Discussion Paper Series 18-23, Department of Economics at the University of Luxembourg.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Knobloch, Florian & Pollitt, Hector & Chewpreecha, Unnada & Lewney, Richard & Huijbregts, Mark A.J. & Mercure, Jean-Francois, 2021. "FTT:Heat — A simulation model for technological change in the European residential heating sector," Energy Policy, Elsevier, vol. 153(C).
    2. J.-F. Mercure & A. Lam & S. Billington & H. Pollitt, 2018. "Integrated assessment modelling as a positive science: private passenger road transport policies to meet a climate target well below 2 ∘C," Climatic Change, Springer, vol. 151(2), pages 109-129, November.
    3. Mercure, Jean-François, 2018. "Fashion, fads and the popularity of choices: Micro-foundations for diffusion consumer theory," Structural Change and Economic Dynamics, Elsevier, vol. 46(C), pages 194-207.
    4. F. Knobloch & J. -F. Mercure, 2016. "The behavioural aspect of green technology investments: a general positive model in the context of heterogeneous agents," Papers 1603.06888, arXiv.org.
    5. Li, Francis G.N. & Trutnevyte, Evelina & Strachan, Neil, 2015. "A review of socio-technical energy transition (STET) models," Technological Forecasting and Social Change, Elsevier, vol. 100(C), pages 290-305.
    6. J. -F. Mercure & H. Pollitt & A. M. Bassi & J. E Vi~nuales & N. R. Edwards, 2015. "Modelling complex systems of heterogeneous agents to better design sustainability transitions policy," Papers 1506.07432, arXiv.org, revised Feb 2016.
    7. Michael Grubb & Jean-Francois Mercure & Pablo Salas & Rutger-Jan Lange & Ida Sognnaes, 2018. "Systems Innovation, Inertia and Pliability: A mathematical exploration with implications for climate change abatement," Working Papers EPRG 1808, Energy Policy Research Group, Cambridge Judge Business School, University of Cambridge.
    8. Hafner, Sarah & Anger-Kraavi, Annela & Monasterolo, Irene & Jones, Aled, 2020. "Emergence of New Economics Energy Transition Models: A Review," Ecological Economics, Elsevier, vol. 177(C).
    9. Mercure, J.-F. & Pollitt, H. & Chewpreecha, U. & Salas, P. & Foley, A.M. & Holden, P.B. & Edwards, N.R., 2014. "The dynamics of technology diffusion and the impacts of climate policy instruments in the decarbonisation of the global electricity sector," Energy Policy, Elsevier, vol. 73(C), pages 686-700.
    10. J-F Mercure & H. Pollitt & N. R. Edwards & P. B. Holden & U. Chewpreecha & P. Salas & A. Lam & F. Knobloch & J. Vinuales, 2017. "Environmental impact assessment for climate change policy with the simulation-based integrated assessment model E3ME-FTT-GENIE," Papers 1707.04870, arXiv.org, revised Jan 2018.
    11. Lamperti, F. & Dosi, G. & Napoletano, M. & Roventini, A. & Sapio, A., 2020. "Climate change and green transitions in an agent-based integrated assessment model," Technological Forecasting and Social Change, Elsevier, vol. 153(C).
    12. Jean-François Mercure, 2015. "An age structured demographic theory of technological change," Journal of Evolutionary Economics, Springer, vol. 25(4), pages 787-820, September.
    13. Goldthau, Andreas & Sovacool, Benjamin K., 2012. "The uniqueness of the energy security, justice, and governance problem," Energy Policy, Elsevier, vol. 41(C), pages 232-240.
    14. Steffen S. Bettin, 2020. "Electricity infrastructure and innovation in the next phase of energy transition—amendments to the technology innovation system framework," Review of Evolutionary Political Economy, Springer, vol. 1(3), pages 371-395, November.
    15. Fischbacher, Urs & Schudy, Simeon & Teyssier, Sabrina, 2021. "Heterogeneous preferences and investments in energy saving measures," Resource and Energy Economics, Elsevier, vol. 63(C).
    16. Stavins, Robert & Jaffe, Adam & Newell, Richard, 2000. "Technological Change and the Environment," Working Paper Series rwp00-002, Harvard University, John F. Kennedy School of Government.
    17. Lamperti, F. & Dosi, G. & Napoletano, M. & Roventini, A. & Sapio, A., 2018. "Faraway, So Close: Coupled Climate and Economic Dynamics in an Agent-based Integrated Assessment Model," Ecological Economics, Elsevier, vol. 150(C), pages 315-339.
    18. van den Bergh, Jeroen C.J.M., 2008. "Optimal diversity: Increasing returns versus recombinant innovation," Journal of Economic Behavior & Organization, Elsevier, vol. 68(3-4), pages 565-580, December.
    19. Jean-Michel Dalle, 1995. "Dynamiques d'adoption, coordination et diversité : la diffusion des standards technologiques," Revue Économique, Programme National Persée, vol. 46(4), pages 1081-1098.
    20. Kemp, R. & van den Bergh, J., 2006. "Economics and Transitions: Lessons from Economic Sub-disciplines," MERIT Working Papers 2006-038, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:arx:papers:1710.11019. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: . General contact details of provider: http://arxiv.org/ .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: arXiv administrators (email available below). General contact details of provider: http://arxiv.org/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.