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Marginal Abatement Cost Curves and Quality of Emission Reductions: A Case Study on Brazil

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  • Adrien Vogt-Schilb

    () (CIRED - Centre International de Recherche sur l'Environnement et le Développement - CIRAD - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - EHESS - École des hautes études en sciences sociales - AgroParisTech - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique, World Bank - World Bank)

  • Stéphane Hallegatte

    (World Bank - World Bank)

  • Christophe De Gouvello

    () (World Bank - World Bank)

Abstract

Decision makers facing emission-reduction targets need to decide which abatement measures to implement, and in which order. This paper investigates how marginal abatement cost (MAC) curves can inform such a decision. We re-analyse a MAC curve built for Brazil by 2030, and show that misinterpreting MAC curves as abatement supply curves can lead to suboptimal strategies. It would lead to (i) under-investment in expensive, long-to-implement and large-potential options, such as clean transportation infrastructure, and (ii) over-investment in cheap but limited-potential options such as energy-efficiency improvement in refineries. To mitigate this issue, the paper proposes a new graphical representation of MAC curves that explicitly renders the time required to implement each measure. In addition to the cost and potential of available options, designing optimal short-term policies requires information on long-term targets (e.g., halving emissions by 2050) and on the speed at which measures can deliver emission reductions. Mitigation policies are thus best investigated in a dynamic framework, building on sector-scale pathways to long-term targets. Climate policies should seek both quantity and quality of abatement, by combining two approaches. A "synergy approach" that focuses on the cheapest mitigation options and maximizes co-benefits. And an "urgency approach" that starts from a long-term objective and works backward to identify actions that need to be implemented early. Accordingly, sector-specific policies may be used (i) to remove implementation barriers on negative- and low-cost options and (ii) to ensure short-term targets are met with abatement of sufficient quality, i.e. with sufficient investment in the long-to-implement options required to reach long-term targets.

Suggested Citation

  • Adrien Vogt-Schilb & Stéphane Hallegatte & Christophe De Gouvello, 2014. "Marginal Abatement Cost Curves and Quality of Emission Reductions: A Case Study on Brazil," Post-Print hal-00966821, HAL.
  • Handle: RePEc:hal:journl:hal-00966821
    DOI: 10.1080/14693062.2014.953908
    Note: View the original document on HAL open archive server: https://hal-enpc.archives-ouvertes.fr/hal-00966821v3
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    References listed on IDEAS

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    1. Vogt-Schilb, Adrien & Hallegatte, Stéphane, 2014. "Marginal abatement cost curves and the optimal timing of mitigation measures," Energy Policy, Elsevier, vol. 66(C), pages 645-653.
    2. Vogt-Schilb, Adrien & Meunier, Guy & Hallegatte, Stephane, 2012. "How inertia and limited potentials affect the timing of sectoral abatements in optimal climate policy," Policy Research Working Paper Series 6154, The World Bank.
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    Citations

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    Cited by:

    1. Oskar Lecuyer & Adrien Vogt-Schilb, 2013. "Assessing and ordering investments in polluting fossil-fueled and zero-carbon capital," CIRED Working Papers hal-00850680, HAL.
    2. Framstad, Nils Chr. & Strand, Jon, 2015. "Energy intensive infrastructure investments with retrofits in continuous time: Effects of uncertainty on energy use and carbon emissions," Resource and Energy Economics, Elsevier, vol. 41(C), pages 1-18.
    3. Jean Charles Hourcade & Michel Aglietta & B Perrissin-Fabert, 2014. "Transition to a Low-Carbon society and sustainable economic recovery, a monetary-based financial device," Post-Print hal-01692593, HAL.
    4. Lecuyer, Oskar & Vogt-Schilb, Adrien, 2014. "Optimal transition from coal to gas and renewable power under capacity constraints and adjustment costs," Policy Research Working Paper Series 6985, The World Bank.
    5. Halkos, George & Tzeremes, Nickolaos & Kourtzidis, Stavros, 2014. "Abating CO2 emissions in the Greek energy and industry sectors," MPRA Paper 60807, University Library of Munich, Germany.
    6. Adrien Vogt-Schilb & Stephane Hallegatte, 2017. "Climate Policies and Nationally Determined Contributions: Reconciling the Needed Ambition with the Political Economy," IDB Publications (Working Papers) 8319, Inter-American Development Bank.
    7. Stephane Hallegatte & Mook Bangalore & Laura Bonzanigo & Marianne Fay & Tamaro Kane & Ulf Narloch & Julie Rozenberg & David Treguer & Adrien Vogt-Schilb, 2016. "Shock Waves," World Bank Publications, The World Bank, number 22787, April.

    More about this item

    Keywords

    commitment; sectoral policies; climate change mitigation; marginal abatement cost curve;

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