-
TRANSITIONS PATHWAYS AND RISK ANALYSIS FOR CLIMATE
CHANGE MITIGATION AND ADAPTATION STRATEGIES
D3.3: A final brief of 14 country case studies
Project Coordinator: SPRU, Science Policy Research Unit, (UoS)
University of Sussex
Work Package 3 Leader Organisation: SPRU
Contributing authors and organisation: See Appendix A for full
list of contributors. Introduction
and editing by Ed Dearnley (SPRU).
August 2018
-
D3.3: A final brief of 14 country case studies Page 2
TRANSrisk
Transitions pathways and risk analysis for climate
change mitigation and adaptation strategies
GA#: 642260
Funding type: RIA
Deliverable number
(relative in WP) 3.3
Deliverable name: A final brief of 14 country case studies
WP / WP number: 3
Delivery due date: Month 36 (31st August 2018)
Actual date of submission: 23rd August 2018
Dissemination level: Public
Lead beneficiary: SPRU (WP3 Leader)
Responsible scientist/administrator: Jenny Lieu (SPRU)
Estimated effort (PM): 1 (Production of this Deliverable
only)
Contributor(s): See Appendix A
Estimated effort contributor(s) (PM): 1 (Deliverable write up
only)
Internal reviewer: Ed Dearnley (SPRU)
-
D3.3: A final brief of 14 country case studies Page 3
Preface
Both the models concerning the future climate evolution and its
impacts, as well as the models
assessing the costs and benefits associated with different
mitigation pathways face a high degree
of uncertainty. There is an urgent need to not only understand
the costs and benefits associated
with climate change but also the risks, uncertainties and
co-effects related to different mitigation
pathways as well as public acceptance (or lack of) of low-carbon
(technology) options. The main
aims and objectives of TRANSrisk therefore are to create a novel
assessment framework for
analysing costs and benefits of transition pathways that will
integrate well-established approaches
to modelling the costs of resilient, low-carbon pathways with a
wider interdisciplinary approach
including risk assessments. In addition TRANSrisk aims to design
a decision support tool that should
help policy makers to better understand uncertainties and risks
and enable them to include risk
assessments into more robust policy design.
PROJECT PARTNERS
No Participant name Short Name Country code Partners’ logos
1 Science Technology Policy Research, University of Sussex
SPRU UK
2 Basque Centre for Climate Change BC3 ES
3 Cambridge Econometrics CE UK
4 Energy Research Centre of the Netherlands ECN NL
5 Swiss Federal Institute of Technology (funded by Swiss
Gov’t)
ETH Zurich CH
6 Institute for Structural Research IBS PL
7 Joint Implementation Network JIN NL
8 National Technical University of Athens NTUA GR
9 Stockholm Environment Institute SEI SE, KE
10 University of Graz UniGraz AT
11 University of Piraeus Research Centre UPRC GR
12 Pontifical Catholic University of Chile CLAPESUC CL
-
D3.3: A final brief of 14 country case studies Page 4
Executive Summary
This Documents presents the results of TRANSrisk’s 14 country
case studies. It builds on the earlier
D3.2 ‘Context of 15 country case studies’, which detailed the
background to each of the case
studies.
Here we provide an overview of each case study using a common
template. Each case study
provides a brief description of its background, research methods
and findings. Detailed outputs
are provided in associated documents for each case study (links
are provided); these aim to
disseminate case study findings to a wide variety of audiences.
Case study leaders have been
encouraged to produce documents aimed at both technical and
non-technical audiences, with
outputs including (but not limited to):
Technical audiences:
Journal papers.
Contributions to a special issue of ‘Environmental Innovation
and Societal Transitions’.
Chapters in the TRANSrisk books “Case study narratives on risks
and uncertainties
associated with climate mitigation pathways” and ‘Understanding
risks and uncertainties
in energy and climate policy: Multidisciplinary methods and
tools towards a low carbon
society’.
Conference presentations and posters.
Non-technical audiences:
Policy briefs.
Conference presentations (e.g. trade conferences).
Newsletter articles (e.g. TRANSrisk, organisation’s own, trade
press, etc).
Articles for the EU research dissemination website
climatechangemitigation.eu
One-to-one meetings with key actors.
Each case study also briefly explains its key outreach
activities, and details any research impact
achieved at the time of writing. Note that, as case studies are
currently in the process of finalising
their work, in many cases it is too early to capture significant
research impacts.
Several of the dissemination documents associated with the case
studies are currently in
development. This is especially the case for those with long
publication processes such as book
chapters and journal articles. Drafts can be provided on
request. Further to this, the Deliverable
will be updated at the end of TRANSrisk (December 2018) to
provide updated links and include
further outputs developed during TRANSrisk’s dissemination
period (September to December
2018).
-
D3.3: A final brief of 14 country case studies Page 5
Table of Contents
1 EC Summary Requirements
...................................................................
10
1.1 Changes with respect to the DoA
....................................................... 10
1.2 Dissemination and uptake
...............................................................
10
1.3 Short Summary of results (
-
D3.3: A final brief of 14 country case studies Page 6
6.1.2 Research Methods
......................................................................
44
6.1.3 Findings
..................................................................................
45
6.2 Case Study Outputs
.......................................................................
48
6.3 Case Study Outreach and Impact (also Expected Outreach and
Impact) ....... 49
7 Greece: Solar Power, Buildings and Micro-Generation &
Storage ..................... 50
7.1 Case Study Summary
......................................................................
50
7.1.1 Context/ Background
..................................................................
50
7.1.2 Research Methods
......................................................................
51
7.1.3 Findings
..................................................................................
52
7.2 Case Study Outputs
.......................................................................
55
7.3 Case Study Outreach and Impact (also Expected Outreach and
Impact) ....... 61
8 India: Solar & Wind Power
....................................................................
62
8.1 Case Study Summary
......................................................................
62
8.1.1 Context/ Background
..................................................................
62
8.1.2 Research Methods
......................................................................
63
8.1.3 Findings
..................................................................................
64
8.2 Case Study Outputs
.......................................................................
65
8.3 Case Study Outreach and Impact (also Expected Outreach and
Impact) ....... 67
9 Indonesia: Transition Pathways Through Biogas Development
......................... 68
9.1 Case Study Summary
......................................................................
68
9.1.1 Context/ Background
..................................................................
68
9.1.2 Research Methods
......................................................................
69
9.1.3 Findings
..................................................................................
69
9.2 Case Study Outputs
.......................................................................
72
9.3 (Expected) Case Study Outreach and Impact
........................................ 74
10 Kenya: Geothermal Power and Sustainable Charcoal
.................................... 75
10.1 Case Study Summary
...................................................................
75
10.1.1 Context/ Background
..................................................................
75
10.1.2 Research Methods
......................................................................
76
10.1.3 Findings
..................................................................................
76
10.2 Case Study Outputs
.....................................................................
78
10.3 Case Study Impact and Expected Impact
........................................... 81
11 The Netherlands: Low Emission Transition Pathways in the
Livestock Sector ...... 82
11.1 Case Study Summary
...................................................................
82
11.1.1 Context/ Background
..................................................................
82
11.1.2 Research Methods
......................................................................
83
11.1.3 Findings
..................................................................................
84
-
D3.3: A final brief of 14 country case studies Page 7
11.2 Case Study Outputs
.....................................................................
86
11.3 Case Study Outreach and Impact (also Expected Outreach and
Impact) ..... 89
12 The Netherlands: Solar Energy
...............................................................
90
12.1 Case Study Summary
...................................................................
90
12.1.1 Context/ Background
..................................................................
90
12.1.2 Research Methods
......................................................................
90
12.1.3 Findings
..................................................................................
91
12.2 Case Study Outputs
.....................................................................
92
12.3 Case Study Outreach and Impact (also Expected Outreach and
Impact) ..... 94
13 Poland: Power Sector
..........................................................................
95
13.1 Case Study Summary
...................................................................
95
13.1.1 Context/ Background
..................................................................
95
13.1.2 Research Methods
......................................................................
95
13.1.3 Findings
..................................................................................
96
13.2 Case Study Outputs
.....................................................................
98
13.3 Case Study Impact and Expected Impact
.......................................... 103
14 Spain: Renewable Energy
....................................................................
104
14.1 Case Study Summary
..................................................................
104
14.1.1 Context/ Background
................................................................
104
14.1.2 Research Methods
....................................................................
105
14.1.3 Findings
................................................................................
105
14.2 Case Study Outputs
....................................................................
108
14.3 Case Study Impact and Expected Impact
.......................................... 111
15 Sweden: Decarbonisation of Road Freight
................................................ 112
15.1 Case Study Summary
..................................................................
112
15.1.1 Context/ Background
................................................................
112
15.1.2 Research Methods
....................................................................
112
15.1.3 Findings
................................................................................
113
15.2 Case Study Outputs
....................................................................
114
15.3 Case Study Impact and Expected Impact
.......................................... 116
16 Switzerland: Nuclear Exit
....................................................................
117
16.1 Case Study Summary
..................................................................
117
16.1.1 Context/ Background
................................................................
117
16.1.2 Research Methods
....................................................................
117
16.1.3 Findings
................................................................................
119
16.2 Case Study Outputs
....................................................................
120
16.3 Case Study Outreach and Impact (also Expected Outreach and
Impact) .... 123
-
D3.3: A final brief of 14 country case studies Page 8
17 United Kingdom: Nuclear Expansion Versus Nuclear Phase Out
...................... 125
17.1 Case Study Summary
..................................................................
125
17.1.1 Context/ Background
................................................................
125
17.1.2 Research Methods
....................................................................
126
17.1.3 Findings
................................................................................
127
17.2 Case Study Outputs
....................................................................
129
17.3 Case Study Outreach and Impact (also Expected Outreach and
Impact) .... 131
18 Appendix A – Full List of Contributors
..................................................... 133
-
D3.3: A final brief of 14 country case studies Page 9
Figures
Figure 1 Poverty Rate of households, using three chosen
indicators .................................. 35
Figure 2 Compensating variation households for the highest price
of electricity, Millions of dollars
...................................................................................................................
37
Figure 3 Risks on both pathways: household biogas and
large-scale biogas for electricity ........ 71
Tables
Table 1: TRANSrisk’s Case Studies
..........................................................................
12
Table 2 Summary of links between case studies (WP3) and
Deliverables in other WPs ............. 16
Table 3 Households in Energy Poverty, according to the "Ten
Percent Rule," after the
implementation of the CO2 tax
..............................................................................
36
Table 4 Basic design of two low emission transition pathways
......................................... 82
-
D3.3: A final brief of 14 country case studies Page 10
1 EC SUMMARY REQUIREMENTS
1.1 Changes with respect to the DoA
There are no changes with respect to the DoA.
1.2 Dissemination and uptake
This Deliverable serves as a concise overview of TRANSrisk’s
case studies, and provides links to a
diverse body of work documenting their outputs. Taken as a
whole, this Deliverable can be used
in one of two ways:
To gain an overview of TRANSrisk’s 14 country case studies.
As a library of links to documents associated with each case
study, which provide more in-
depth results of their findings. Generally, our case study
leaders have produced
publications aimed at both technical (e.g. journal articles and
book chapters) and non-
technical audiences (e.g. policy briefs, newsletter articles,
etc).
1.3 Short Summary of results (
-
D3.3: A final brief of 14 country case studies Page 11
1.4 Evidence of accomplishment
This Deliverable and associated documents.
-
D3.3: A final brief of 14 country case studies Page 12
2 INTRODUCTION
2.1 The TRANSrisk Case Studies
The core of the TRANSrisk project is 14 country case studies;
each one examines specific
technologies in different country contexts. In addition to their
value as individual pieces of work,
the case studies have fed into TRANSrisk’s overall investigation
of risk and uncertainty in low
carbon transitions. They have also acted as testbeds for the
policy development tools and
techniques pioneered by the project.
Table 1 lists the case studies and the sectors they covered.
TRANSrisk deliberately selected a
diverse range of case studies from across the world: from Europe
and North America to the fast
growing economies of Asia, Africa and South America. Case
studies were divided into ‘full’ and
‘limited’ categories depending on the resources applied to them.
In practice the boundary
between the two categories has become somewhat blurred, with
several limited studies providing
a more detailed study than originally envisaged.
Table 1: TRANSrisk’s Case Studies
Country/Region
Sector covered Full case study
(≥ 15 interviews; ≥
1 workshop)
Limited case
study
(≤ 15 interviews;
optional workshop)
1. Austria Energy and steel X
2. Canada Oil Sands/ energy X
3. Chile Energy and industry X
4. China Building sector X
5. Greece Solar power and building sector X
6. India Solar power and wind X
7. Indonesia Biomass and cook stoves X
8. Kenya Geothermal and charcoal X
-
D3.3: A final brief of 14 country case studies Page 13
9. Netherlands Solar PV and integrated manure
management X
10. Poland Energy sector X
11. Spain Transport, biofuels, biomass X
12. Sweden Solar and Wind X
13. Switzerland Renewable energy electricity
14. UK Nuclear power X
15. Global & regional overview
General discussion on direction of
global trends, climate agreements X
* Part of D3.2 only
Note that both the Greece and Netherlands case studies are
comprised of two separate parts, i.e.
they study two separate technology sectors. In this Deliverable
the Netherlands studies are
described separately in sections 11 and 12, whilst the Greece
studies are described together in
section 7.
A complete introduction and context for each case study is
available in D3.2 ‘Context of 14 country
case studies’, which was submitted in November 2016.
2.2 Research Approach
At the start of the TRANSrisk project a common research approach
was agreed to guide the case
study work. This approach was detailed in D3.1 ‘Matrix of
technological innovation systems for
14 country case studies’ and D3.2 ‘Context of 14 country case
studies’. Here we briefly recap the
research statements and questions used across all case
studies.
The 3 research statements, as summarised in Box 1, were used to
guide the background analysis
required for each case study, ensuring each case study was
grounded in a common understanding
of the global and local context. Research statements 1 and 2
help to set the stage by describing
global and regional targets and agreements. Here we acknowledged
the risks of continuing on the
current pathway, and provided the global and regional case study
to ensure a common
understanding of the issues. The case studies then explored
research statement 3 by providing the
context for each country case study, as documented in D3.2
-
D3.3: A final brief of 14 country case studies Page 14
BOX 1: Research Statement (RS) background analysis: setting the
stage
RS1: Understand the risks of climate change. Reference IPCC 2°C
target in The Global & Regional Case Studies.
RS2: Understand the risks of continuing on the current pathway.
Reference existing research in The Global & Regional Case
Studies
RS3. Understand how we got here and where we are now
a. What is our current energy mix, what are the technological
lock-ins, and what are the (natural) resource
constraints/opportunities?
We then developed an overarching research questions and, under
this, 4 more sub-questions.
These are shown in Box 2.
BOX 2: Overarching Research Question (RQ):
What are the costs, benefits and risks associated with
transitions pathways for climate change mitigation
policies/strategies at the global, regional level and the national
level?
RQ1. What are possible future(s) in our case study
country/sector context and how might we get there? a. What are the
economic, social and environmental priorities to be considered in a
low-
carbon transition to arrive at our desired future(s)? RQ2. What
changes are required for us to get to our desired future(s)? a.
Which specific transition pathways are to be examined, each
ensuring the future we want,
while considering our priorities? b. What are the, costs,
benefits, risks and opportunities of the low-carbon options
included
in the pathways (e.g. economic, social and environmental
impacts)? c. What are the interests and capabilities of actors
involved and what are the external
pressures that may influence the identified changes?
RQ3. What are the policy options for realising pathway(s) and
what are their risks, uncertainties and opportunities?
a. What policy options can help accelerate implementation of the
identified pathways? b. What are the uncertainties involved, in
which dimensions are these uncertainties and what
are they dependent on? c. What are the risks & opportunities
of the policy options connected to these transition
pathways, given the uncertainties?
RQ4. How can we prepare to deal with these risks and options,
and what policy tools and actions could we take within and across
transition pathways?
Each case study explored research questions 1, 2 and 3, which
identify: possible futures; changes
that are needed; and the potential policy options. However, case
studies did not intend to explore
research question 4 in detail, as it is more concerned with
implementation, which is generally
beyond the scope of the TRANSrisk project. This research
question was formulated to pave the
ground for future research based on answering the first three
research questions.
Each case study considered the overarching research questions,
whilst also developing country
specific research questions. More detail is provided in the
summaries of each case study provided
later in this report.
-
D3.3: A final brief of 14 country case studies Page 15
2.3 Documenting the TRANSrisk Case Studies
To reach the widest possible audience, case study leaders have
been encouraged to document
(‘write up’) their case studies using a variety of methods and
media. This Deliverable therefore
contains only a summary of each case study, with the bulk of
each case study’s documentation
available as supplementary documents. These documents fall into
two main categories:
Technical documents. These are aimed at audiences with a science
background, and
include (for example) journal articles, book chapters (Springer
book) and presentations
from scientific conferences.
Non-technical documents. These are aimed at groups such as
policy makers, NGOs,
journalists, etc. who do not necessarily have a scientific
background. They include (for
example) policy briefs, book chapters (Routledge book)
newsletter articles, videos and
media interviews.
In addition to existing opportunities to publish results (such
as scientific journals) TRANSrisk has
directly developed several opportunities for case study leaders
to showcase their work. These
include:
Two scientific books to be published in late 2018/ early 2019:
“Case study narratives on
risks and uncertainties associated with climate mitigation
pathways”, to be published by
Routledge; and “Understanding risks and uncertainties in energy
and climate policy:
Multidisciplinary methods and tools towards a low carbon
society”, to be published by
Springer.
A special issue in the Environmental Innovation and Societal
Transitions (EIST) journal, with
the title “Assessing risks and uncertainties of low-carbon
transition pathways”.
A TRANSrisk policy brief and working document series.
climatechangemitigation.eu, a website showcasing the work of
H2020 funded climate
change project (established by the CARISMA project in
partnership with TRANSrisk and
several other H2020 projects).
The exact mix of documents has been decided by each case study
leader, working in partnership
with TRANSrisk’s dissemination team. Note that at the time of
this Deliverable’s submission some
of these documents are yet to be published. This Deliverable
will be updated towards the end of
the project to provide a final list of supplementary documents
and associated web links.
2.4 Case Study Inputs to Other TRANSrisk Deliverables
In addition to their individual outputs, the case studies have
been used to provide input for many
of TRANSrisk’s Deliverables. They have also been used to test
the tools and approaches developed
by the project to aid development of low carbon pathways. These
inputs are summarised in Table
2 below:
-
D3.3: A final brief of 14 country case studies Page 16
Table 2 Summary of links between case studies (WP3) and
Deliverables in other WPs
Country/Region D2.3 D2.5 D4.2 D4.3 D4.4 D5.2 D5.3 D5.4 D5.5 D6.1
D6.2 D6.3 D6.4 D6.5
(TBC)
D7.1 D7.2 D7.3
1. Austria X X X X X
2. Canada X X X
3. Chile X X X X
4. China X X
5. Greece X X X X X X X X X X
6. India X X
7. Indonesia X X X X X X
8. Kenya X X X X X X X X X
9. Netherlands X X X X X X
10. Poland X X X X X
11. Spain X X X X
12. Sweden X X X
13. Switzerland X X X X X X
14. UK X X X X X X
-
D3.3: A final brief of 14 country case studies Page 17
3 AUSTRIA: DECARBONISING THE IRON & STEEL AND ELECTRICITY
SUPPLY SECTOR
3.1 Case Study Summary
3.1.1 Context/ Background
For achieving the EU’s 2050 decarbonisation goals, steeper
emission reductions after 2030 are
required than before. Therefore not only combustion,
energy-related emissions (e.g. from burning
gasoline) and emissions from agriculture and forestry have to be
reduced, but also industrial
process emissions (i.e. chemical processes like reduction of
oxygen from iron ore). If the demand
of process-intensive products cannot decrease, the only way to
reduce emissions is a radical switch
to alternative technologies. This involves a wide spectrum of
risks and uncertainties, not only for
this sector but (due to economic and energy interdependencies)
also for other sectors. The iron &
steel sector and the electricity supply sector comprise nearly
half of Austrian greenhouse gas
(GHG) emissions (ETS and outside the ETS), and contribute 16% to
the real gross domestic product
(GDP) (Anderl et al., 2017; Statistics Austria, 2017).
The Austrian case study therefore focuses on these sectors and
explores the impacts, risks and
uncertainties of transition pathways thereof. The analysis
builds on an extensive stakeholder
involvement throughout the entire project. This included
developing transition pathways,
exploring risks and uncertainties (as well as measures to
overcome or minimise them), and the
perpetual dialogue between stakeholders and scientists in order
to refine specific technology
scenarios and discuss modelled impacts. This brought together
sector specific insights with
macroeconomic impacts - the latter had not previously been
considered in decisions on the
business or political level.
The “deep decarbonisation” pathway explored combines an
electricity sector transition towards
almost 100% renewables with the iron and steel industry
simultaneously going for zero-process
emission steel production (i.e. a switch from coke-based to
hydrogen-based technologies).
3.1.2 Research Methods
We applied a transdisciplinary approach linking macroeconomic
modelling with heavy stakeholder
involvement over the course of two years.
Qualitative methods were bilateral calls, semi-structured
interviews, a survey and two workshops,
which were at the core of the stakeholder dialogue. The
overarching method applied is
“participatory backcasting” which starts with a shared vision of
a desired future and then develops
pathways and milestones along these pathways to get there.
-
D3.3: A final brief of 14 country case studies Page 18
Semi-structured interviews were conducted in order to gain
understanding and learn about the
case study context prior to the workshops. We applied several
settings within the two workshops,
e.g. card surveying, group work, World Café, silent feedback
method, with the aim of developing
transition pathways, exploring risks and uncertainties,
prioritising risks and developing measures
to reduce or overcome the main risks.
Qualitative methods were strongly integrated and iterated with
quantitative modelling work. The
WEGDYN model (Mayer et al., 2017) - a global multi-regional,
multi-sectoral computable general
equilibrium (CGE) model - was applied to assess the economy-wide
effects of economic (e.g.
sectoral) system interventions of the transition pathway.
3.1.3 Findings
In our TRANSrisk case study work on the steel and electricity
sector we found out, that
implementation risks – i.e. barriers to low-carbon pathways
being implemented – are relatively
more prominent than consequential risks. The most important
implementation risks are the
absence of a solid, reliable national long-term policy framework
(leading to reluctant investment
for consumers and business) and missing cross-sectoral policy
integration. We have learned that
industry is more willing to mitigate climate change, as it sees
many opportunities for innovation
and first-mover-advantages than politicians have perhaps failed
to yet identify.
Part of what stakeholders refer to as implementation risks can
be traced back to perceived
consequential risks, like the fear of unemployment. In
quantifying consequential risks in our
analysis, we attempted to put these perceived impacts of the
transition pathways in perspective:
GDP growth decreases slightly in all deep decarbonisation
scenarios (range in between -0.02% and
-0.07%-points). Unemployment rates are in the same vein but tend
to converge to baseline
numbers in the long run.
Other consequential, high ranked risks comprise risks of lock-in
effects for industries in specific
technologies and value chains, the risk of play–off between
social justice and climate mitigation,
risks associated with storage and the risk of instability of
grids when choosing the deep
decarbonisation pathway. Stakeholders identified an additional
electricity demand of 33TWh in
2050 (i.e. about half of national electricity production in
2017) as a major risk. However,
quantitative analysis showed that this number halves when
indirect feedback effects within the
economy system are considered. This shows how stakeholders could
benefit from modelling work
and. conversely, that modeller’s work is not possible without
ongoing exchange and reflection on
technological and cost assumptions enabling more realistic
pathways for transition.
-
D3.3: A final brief of 14 country case studies Page 19
3.2 Case Study Outputs
Output Category Date Link
Routledge book chapter ‘Austria: Designing a low-carbon
transition pathway focusing on energy supply for the iron
and steel sector’
Book chapter July 6th 2018 Submitted (under revision)
Presentation of ‘Macro-economic implications of a 2°C-
compatible transition path in the European iron and steel
industry’ at the ‘AUROE - Nachwuchsworkshop’;
University of Basel (SUI)
Conference
presentation
14th February
2017
http://www.auroe.info/documents/2017_Nachwuch
sworkshop_Programm.pdf
Presentation of ‘Macro-economic implications of a 2°C-
compatible transition path in the European iron and steel
industry’ at the ‘EcoMod Conference 2017’; University of
Ljubljana (SLO)
Conference
presentation
5th July 2017 https://ecomod.net/conferences/ecomod2017
-
D3.3: A final brief of 14 country case studies Page 20
Presentation of ‘Macro-economic implications of a 2°C-
compatible transition path in the European iron and steel
industry’ at the ‘International Energy Workshop 2017’;
University of Maryland (USA)
Conference
presentation
13th July 2017
http://www.internationalenergyworkshop.org/meeti
ngs-10.html
Presentation of ‘Macroeconomic implications of
switching to process-emission-free iron and steel
production in Europe’ at the ‘World Congress of
Environmental and Resource Economists’; University of
Gothenburg (SWE)
Conference
presentation
27th June 2018 https://www.eaere-conferences.org/
1st TRANSrisk Stakeholder Workshop (Vienna) Organisation
and
Presentation
4th November
2016
Agenda and Short Report available on request
2nd TRANSrisk Stakeholder Workshop (Vienna) Organisation
and
Presentation
17th November
2017
Agenda, Short Report available on request
Presentation of ‘Macroeconomic implications of
switching to process-emission-free iron and steel
Poster
presentation
24th April 2018
https://www.ccca.ac.at/de/dialogformate/oesterr-
klimatag/
-
D3.3: A final brief of 14 country case studies Page 21
production in Europe’ at the ‘CCCA Climate Day Austria’;
University of Salzburg (AUT)
Presentation at the lunchtime seminar to European
Commission (DG CLIMA)
Presentation
at a seminar
7th March 2017 Agenda available on request
EIST paper ‘Risk Assessment of Low Carbon Transition
Pathways for Austria’s Steel and Electricity Sectors –
Insights from a Co-Production Process’
Scientific
paper
16th July 2018 Submitted (under revision)
Climatechangemitigation.eu article, ‘The carbon bubble
and investment risk – getting capital costs ‘right’ in
Europe’s electricity sector transition’
Website
article
25th June 2018
http://climatechangemitigation.eu/2018/06/the-
carbon-bubble-and-investment-risk-getting-capital-
costs-right-in-europes-electricity-sector-transition/
Presentation of ‘Macroeconomic implications of
switching to process-emission-free iron and steel
production in Europe’ at the ‘EAERE-ETH Winter School’;
Ascona (SUI)
Winter school
presentation
1st February
2018
http://www.resec.ethz.ch/research/eaere-eth-
european-winter-school/2018-winter-school1.html
TRANSrisk working document ‘Macroeconomic
implications of switching to process-emission-free iron
and steel production in Europe’
Working
paper
30th November
2017
https://ideas.repec.org/p/grz/wpaper/2017-
14.html
-
D3.3: A final brief of 14 country case studies Page 22
TRANSrisk working document ‘The economy-wide effects
of deep decarbonisation and their uncertainties - The
case of the European iron and steel industry’
Working
paper
Apr-18 Available on request
TRANSrisk working document ‘The carbon bubble and
investment risk – getting capital costs ‘right’ in Europe’s
electricity sector transition’
Working
paper
Apr-18 Available on request
-
D3.3: A final brief of 14 country case studies Page 23
3.3 Case Study Outreach and Impact (also Expected
Outreach and Impact)
Preliminary findings of the macroeconomic modelling of the
decarbonisation pathways were
presented and discussed among the scientific community. On the
international level presentations
were given on the EcoMod Conference 2017 at the University of
Ljubljana
(https://ecomod.net/conferences/ecomod2017), the International
Energy Workshop 2017 at the
University of Maryland
(http://www.internationalenergyworkshop.org/meetings-10.html),
the
World Congress of Environmental and Resource Economists 2018 in
Gothenburg
(https://www.eaere-conferences.org/) and the AUROE-Workshop 2017
at the University of Basel
(http://www.auroe.info/documents/2017_Nachwuchsworkshop_Programm.pdf).
On the national
level results were presented at the CCCA Climate Day Austria
2018 in Salzburg.
Besides discussions and presentations among the scientific
community, we estimate the impacts
of our work even more important through the continuous
involvement of stakeholders. This took
place throughout the entire research process, starting with the
development of pathways, then
exploring and prioritising risks, refining technology scenarios
and developing measures. By means
of bilateral interviews, surveys and two Stakeholder Workshops
held on November 4th 2016 and
November 17th we created a forum for the most relevant
stakeholders from the energy sector
(leading energy supply companies), the steel and iron companies,
NGOs as well as from
administration and politics – such a forum was unique for
Austria. As a positive side-effect,
stakeholders from NGOs and the industry were brought together
and discussed common solutions,
this after a long term history of cooling of relations. We
carried out additional stakeholder
interviews with non-Austrian steel companies in May and June
2018 to validate our results.
A detailed description of the stakeholder process that can be
transferred to and applied for other
case studies led into a paper submitted to a special issue of
‘Environmental Innovation and Societal
Transitions’. Furthermore, the research team has been invited to
the ‘Future of Steel Dialogue’
with NGOs and leading steel and iron companies to present
modelling results (October 2017).
After the second workshop, it was very evident that there was
strong demand for continuing these
neutral fora to discuss issues of transition and work on
measures to overcome risks. Opportunities
for an in depth exchange across sectors seemed very scare, but
were highly needed for a deep
decarbonisation. Annual meetings within the same stakeholder
group are now planned for the
future, organised by the different industries involved.
TRANSrisk’s work showed that a role of
increasing relevance for scientists is to arrange such fora and
act as mediator between agents
(industry, administration, and policymaking) besides providing
research results, especially when
politics does not identify this need.
https://ecomod.net/conferences/ecomod2017http://www.internationalenergyworkshop.org/meetings-10.htmlhttps://www.eaere-conferences.org/http://www.auroe.info/documents/2017_Nachwuchsworkshop_Programm.pdf
-
D3.3: A final brief of 14 country case studies Page 24
References:
Anderl, M., Burgstaller, J., Gössl, M., Haider, S., Heller, C.,
Ibesich, N., Kuschel, V., Lampert, C.,
Neier, H., Pazdernik, K., Poupa, S., Purzner, M., Rigler, E.,
Schieder, W., Schneider, J., Schodl,
B., Stix, S., Storch, A., Stranner, G., Vogel, J., Wiesenberger,
H., Winter, R. and Zechmeister, A.,
2017a. Klimschutzbericht. (2017). [online] Wien:
Umweltbundesamt. Available at:
[Accessed 22
Jan. 2018].
Mayer, J., Bachner, G., Steininger, K.W., 2017. Macroeconomic
implications of switching to
process emission-free iron and steel production in Europe. Graz
Economic Papers 2017-14.
Statistics Austria, (2017). Gross Domestic Product by sectors,
current prices. [online] Available at:
http://statistik.at/web_de/statistiken/wirtschaft/volkswirtschaftliche_gesamtrechnungen/brutt
oinlandsprodukt_und_hauptaggregate/jahresdaten/019715.html>
[Accessed 18 May 2018].
-
D3.3: A final brief of 14 country case studies Page 25
4 CANADA: OIL SANDS
4.1 Case Study Summary
4.1.1 Context/ Background
Canada contributes 1.6 % of global greenhouse gas (GHG)
emissions and it is one of the top ten
emitters - on both total and per capita - in the world. Fossil
fuel production and transportation
are the largest contributors to this total, with 27 % and 23 %
respectively. The province of Alberta
contributed to 37.4 % of national emissions in 2014,
representing the biggest emitter among all
provinces in Canada (Statistics Canada, 2006). Canada has the
second largest oil reserves in the
world, most of which primarily exist in the form of crude
bitumen. The majority of proven reserves
are found in oil sands in Western Canada. Unproven (expected)
reserves, however, are considered
to be significantly larger and are likely to reside in Alberta’s
oil sands. The oil sands production
process emits significant GHGs and pollution, and this has led
to damaging environmental and
health impacts. The industry has been making efforts to address
the problem by developing new
technologies to cut GHGs, but environmental degradation
persists. Clear links have not yet made
between oil sand production and health impacts.
This case study explored both the broader environmental impacts
of the oil sand production in
Alberta as well as the environmental, economic and social
impacts. The case study intended to
explore the complex issues of First Nations interests, and the
vested interests of oil sand
developers, by engaging a wide range of stakeholders in the
study. In addition, the case study
aimed to gain a better understanding of how Alberta can meet
climate change goals by exploring
the current fossil fuel energy system. In doing so it helped by
identifying risks and uncertainties
in potential low carbon transitions pathways.
4.1.2 Research Methods
The approach selected for the development of the narrative
consisted of two stages: pathway
development and elicitation of preference and risks associated
with the pathways. The broader
public sentiment with regards to climate action policies and
low-carbon futures for the oil sands,
was collected through media articles including newspapers, blogs
and websites from government,
industry and institutional (NGOs, companies). We also collected
information from Statistics
Canada, the government’s national statistics body. The three
pathways represent three distinct
views originated from policy makers, an Indigenous community
(Fort McKay First Nation) and
institutions (including firms, electricity regulators, experts
and NGOs) with regards to potential
solutions for decreasing the environmental impact of the oil
sands. The pathways were developed
from existing policies and studies that consulted a range of
stakeholders.
-
D3.3: A final brief of 14 country case studies Page 26
Aside from including existing policies and research initiatives,
we have independently carried out
17 open ended interviews with stakeholders over the period of
November 2016 to April 2018. These
included: academics (4 interviews), Indigenous Community members
(6 interviews), industry
players (5 interviews), a non-profit organisation (1 interview)
and a policy maker (1 interview).
We also carried out a risk elicitation by capturing the opinion
of stakeholders during two public
workshops. The first workshop was part of an existing
conference, the Alberta Ecotrust
Environmental Gathering. Researchers carried out a ‘Solution
Forum’ to explore how consensus
can be reached within groups with various perspectives about
sustainable development of natural
resources in Alberta. The event took placed on Mount Royal
University on March 10th, 2018. There
was a total of 24 participants. The attendees consisted of
government bodies, politicians, industry
members, researchers and NGOs. Reponses were captured through
small group role-playing
exercises and a live polling. The second workshop ‘Creating a
common language for low-carbon
futures in Alberta’ was organised within an existing seminar
series run by the Graduate Collages
at the University of Calgary. The workshops consisted of a panel
discussion. The interview panel
included an industry representative, a policy consultant, an
Elder from the Fort McKay community,
a representative from the Fort McKay Sustainability Office and
an academic. The panel discussion
took place on March 12th, 2018.
4.1.3 Findings
Three main low-carbon pathways scenarios were identified for the
Canadian oil Sands sector. One
followed the official proposal from the provincial government,
one was based on Indigenous needs
and priorities and one was based on a combined strategy created
by collaboration of several groups
and aligned with the federal strategy. Within these pathways,
implementation and consequential
barriers were captured from stakeholders as potential risks for
this future to materialise. These
barriers were mostly concentrated around economic losses,
environmental degradation, social
imbalance and health impacts. Also, the visibility of each risk
was dependant on the point of view
of each stakeholder. However, a bigger risk is based in the lack
of consensus among stakeholders
and the absence of a pathway capable of unify and represent all
view points.
From the pathways studied, the Indigenous communities, most
directly impacted by the oils sands
development (the sector uses traditional land in the vicinity of
their communities), was the least
represented among all. Although efforts to consult and include
Indigenous communities has been
made for all narratives, true inclusion or representation is not
evident in their actions plans. This
means that Indigenous communities, who are most impacted by any
action or policy towards
reducing emissions in the oil sands sector, will have little
ability to influence their fate. Such
realities call for urgent action in incorporating
Indigenous/local communities in the process of co-
developing policies effective to meet the commitments of Canada
in the Paris Agreement.
As a way forward, a consensus-building framework - The Consensus
Building Engagement Process
(CBEP) - focused on step-by-step consensus building through
consultation and inclusion of all
-
D3.3: A final brief of 14 country case studies Page 27
affected stakeholders, could serve as an important tool to
maintain the interest and commitment
of the participants. In one of our outputs we have presented a
CBEP framework that includes
Indigenous consensus, knowledge, interests and rights as a focal
point of a consultation process
required for decision making. The consultation process is
presented within the context of land use
decisions impacting on a low carbon future for oil sands
development. The framework is based on
seeking consensus from all parties involved and aims to help to
reduce risks resulting from
decisions that do not consider the interests and rights of
communities most impacted by resource
development or climate mitigation pathways. The framework could
consider Indigenous needs,
priorities and knowledge and, by building consensus along the
planning and execution of the
project/initiative. Understanding the local values and allowing
local communities to have an
active role in the developing process, could generate benefits
in the area of effectiveness, social
support, and finding innovative ways to promote climate
action.
The results of this study indicate that the three pathways could
be successful in reducing carbon
emissions. However, this reduction may not be enough to meet the
NDC goals if the social
priorities, such as economic and environmental security, are not
considered during the policy
development stage. Social acceptance and unfavourable policy
frameworks were identified as
relevant risks to meet the sustainability goals. Global climate
action is expected to negatively
impact the oil sands sector and the Canadian economy, increasing
the risks of rejection of low-
carbon policies in Canada. Nevertheless, economic contraction is
expected to be accentuated if
Canada takes no action on climate change. Regional analysis from
model outputs showed that the
future of Canadian climate goals and economic development is
highly impacted by foreign actions,
stressing the need for innovations in the development of natural
resources to decrease exposure
to foreign market decisions. These findings point to the need
for low-carbon policy development
based on factors relatable to the local communities and
supported by evidence based from model
outputs based and stakeholder knowledge.
The study of the multiple pathways shared by stakeholders in the
Canadian oil sands, highlights
the need for developing effective climate action capable to
incorporate and represent local
interests and concerns. Although, efforts have been done in the
past to improve representation of
several sectors, even-leveled participation through
incorporation and consensus could be more
effective that simple inclusion. A process to consider local
communities as equal participants in
the co-development process of policy could be more effective to
those changes implemented so
far that have brought plenty of criticisms for the lack of
community representation. There is no
formula for this approach, since such action would require
acknowledging varying cultures and
worldviews. However, if policies are developed and/or
implemented with this notion, the
evidence gap between climate policy and real impact could be
decreased.
-
D3.3: A final brief of 14 country case studies Page 28
4.2 Case Study Outputs
Output Category Date Link
COP23 Side Event, ‘UK pavilion’, ‘The case
of the oil sands in Alberta’
Conference
presentation
09th November 2017 https://www.gov.uk/government/news/uk-at-
cop23-in-bonn
Stakeholder Engagement, Solution Forum,
‘What is the best way to reach consensus
within groups with various perspectives
about sustainable development of natural
resources in Alberta?’
Conference
presentation
10th March 2018 https://albertaecotrust.com/gathering2018/
Stakeholder Engagement, Panel discussion,
‘Creating a common language for low-
carbon futures in Alberta’
Panel discussion 12th March 2018
https://arctic.ucalgary.ca/creating-common-
language-low-carbon-futures-alberta
Presentation at the 2018 HELORS
conference, ‘Consensus building in
stakeholder engagement processes for
natural resources management’
Conference
presentation
14th June 2018 http://eeee2018.maich.gr/
-
D3.3: A final brief of 14 country case studies Page 29
Presentation at the 2018 HELORS
conference, ‘Mixed methods for assessing
risks in low-carbon futures for the
Athabasca Oil Sands, Canada’
Conference
presentation
15th June 2018 http://eeee2018.maich.gr/
TRANSrisk Policy Brief, ‘Low carbon future
for the oils sands sector’
Policy brief Nov-18 TBC
Springer book chapter, ‘Consensus Building
in Engagement Processes’ for reducing risks
in developing sustainable pathways:
Indigenous interest as core elements of
engagement’ (in progress)
Scientific book chapter Sep-18 www.springer.com/gp/
Routledge book chapter, ‘Developing a
common low-carbon language. Inclusion of
Indigenous knowledge in the energy futures
of the Athabasca Oil Sands, Canada’ (in
progress)
Scientific book chapter Sep-18 https://www.routledge.com/
-
D3.3: A final brief of 14 country case studies Page 30
EIST Paper, ‘Mixed methods for assessing
risks and uncertainties for low-carbon
futures in the Athabasca Oil Sands,
Canada’ (in progress)
Scientific paper Sep-18
www.sciencedirect.com/journal/environmental-
innovation-and-societal-transitions/
Talanoa Dialogue, Non-Party stakeholders’
inputs Submission – Alberta, Canada
UNFCC Submission 10th April 2018
https://unfccc.int/process-and-meetings/the-
paris-agreement/2018-talanoa-dialogue-platform
-
D3.3: A final brief of 14 country case studies Page 31
4.3 Case Study Outreach and Impact (also Expected
Outreach and Impact)
Preliminary results of the case study findings have been
presented to Mr. Neal Tanna,
Environmental Assessment & Management Professional, who was
part of the initial generalists
interviewed. Following this meeting, we have been invited to
present the obtained evidence to
the COSIA (Canada’s Oil Sands Innovation Alliance -
https://www.cosia.ca/) Scientific Committee,
a group formed by scientists specialising in GHG emissions from
oil sands, which will provide a
platform to share our results to the most important oil
producers in Alberta. Details about this
meeting are currently in planning stage.
We have been invited to host a seminar to disseminate our case
study results as part of the
ConocoPhillips IRIS Seminar Series of the Haskayne School of
Business of the University of Calgary
(https://haskayne.ucalgary.ca/research-centres/ccs/events/conocophillips).
This event aims to
share sustainability research to industry and community
audiences. The event is being planned for
November 29th 2018, and details about the format and agenda are
currently in progress.
-
D3.3: A final brief of 14 country case studies Page 32
5 CHILE: RENEWABLE ENERGY AND ENERGY POVERTY
5.1 Case Study Summary
Chile is facing increasing demands on energy resources to
respond to the expected social,
environmental and economic welfare of the population; as well as
to contribute to the global
efforts to deal with climate change and improving the
environment. For these purposes, the
Chilean government is trying to improve the use of its resources
by increasing the efficiency and
quality of energy generation and exploring different
technological options that support its
ambitions to reduce greenhouse gases (GHGs) emissions.
This case study attempted to answer the overarching research
question, “How can Chile move
towards a more efficient use of energy resources to support
sustainable growth?”. There were two
major strands to our work, which were:
Exploration of the links between air quality (public health) and
climate change, the results
of which were detailed in TRANSrisk Deliverable 4.4.
Investigation of the impacts of energy policies on energy
poverty, which is summarised
here in D3.3 with more detail provided in associated
documents.
5.1.1 Context/ Background
Over the last five years, most nations have become increasingly
committed to improved
environmental policies. Both international and local actions
have been taken to improve
environmental indicators. An example is the 2015 Paris
agreement. Emerging countries such as
Chile are characterised by their active participation in, and
proactive contribution to, the
international environmental agenda. Nevertheless, these
countries face complex challenges in
maintaining both economic growth and environmental standards,
which regularly pull in opposite
directions.
Chile, as a member of the UNFCCC, has committed to reducing GHG
emissions by 30% by 2030
(Gobierno de Chile, 2015). The mitigation efforts should occur
in different sectors that produce
GHGs, focusing on:
Energy, industry, mining and other sectors using fossil
fuels;
Processes in the industrial sector;
Use of land; and
Waste.
To achieve the reduction in GHGs by 2030, Chile has made the
following commitments:
-
D3.3: A final brief of 14 country case studies Page 33
Chile will reduce its greenhouse emissions by 30% vis-à-vis its
2007 levels, provided it is
possible to keep its economic growth pace, and implement the
required policies to achieve
the objective.
Chile will reduce its GHGs emissions by 35% to 45% vis-à-vis its
2007 levels, provided it is
possible to keep economic growth pace and obtain international
grants to finance the
additional required measures to attain the objective.
In the land management sector, Chile commits to the restoration
of 100,000 hectares of
forestry, which corresponds to the reduction of 600,000 tons of
GHGs emissions per year.
The primary Chilean energy mix is oil (32.9%), coal (24.4%),
wood and biomass (23.7%) and
hydroelectricity (6.4%) (Ministerio de Energía de Chile, 2014).
It is important to notice that 95% of
oil is imported, and thus the primary energy matrix is heavily
dependent on international
resources. During 2014, the primary energy supply reached
314,163 teracalories (TCal).
Chile’s GDP per capita has increased at a fastest pace than its
Latin American neighbours. Chile
experienced average per capita GDP growth of 3% between 1980 and
2013, a higher rate than
other countries such as Uruguay (2%), Colombia (1.9%), Argentina
(1.4%), Brazil (0.9%), Venezuela
(-0.1%) and Haiti (-1.2%), among others.
Chile aims to increase its GDP per capita to converge with
advance economies,1 which represents
an important economic challenge for the country. This might
require doubling its current level of
GDP per capita. At current rates, and discounting population
growth, Chile would require almost
70 years to double its actual per capita income. Thus, a main
challenge is to increase its long-
term GDP growth. In addition, Chile has a large income
inequality. Its GINI index is around 0.5,
and there are social and political pressures to expand fiscal
expenditure and engage in social
reforms to reduce income inequality. Thus, a second economic
challenge is to implement
economic policies that favour the poor and decrease income
inequality, but without hurting the
performance of the economy and avoiding the middle-income trap
(Eichengreen, Park and Shin,
2014).
Energy policy is at the heart of public policies in Chile.
Energy is seen as a potential driver of
economic growth and productivity. In fact, energy issues may be
one the reasons behind depressed
total factor productivity over the past few years. As an
example, the former Finance Minister
Alberto Arenas2 suggested that lower growth, at least since
2014, was due partially to the large
1 The World Bank, Data. How does the World Bank classify
countries?, [online] Available at
https://datahelpdesk.worldbank.org/knowledgebase/articles/378834-how-does-the-world-bank-classify-countries
[Accessed 28 November 2016] 2 Electricidad. La revista energética
de Chile:
http://www.revistaei.cl/2014/03/12/ministro-de-hacienda-lamenta-altos-costos-de-energia-y-baja-productividad/[Accessed
09 November 2016].
https://datahelpdesk.worldbank.org/knowledgebase/articles/378834-how-does-the-world-bank-classify-countrieshttps://datahelpdesk.worldbank.org/knowledgebase/articles/378834-how-does-the-world-bank-classify-countrieshttp://www.revistaei.cl/2014/03/12/ministro-de-hacienda-lamenta-altos-costos-de-energia-y-baja-productividad/http://www.revistaei.cl/2014/03/12/ministro-de-hacienda-lamenta-altos-costos-de-energia-y-baja-productividad/
-
D3.3: A final brief of 14 country case studies Page 34
marginal cost of energy. The current Minister of Energy, Maximo
Pacheco, has a similar view.3
Therefore, a decrease in marginal costs of energy could provide
a fresh driver for economic
growth.
Climate change is not a principal driver of public policy to
address GHGs reduction in Chile.
People’s perceptions of climate change are very important, and
public views were taken in a 2015
survey (MMA, 2016a). 65% of the citizens surveyed identified the
top three most severe
environmental challenges as air pollution, urban waste and
noise. Only 1% of the surveyed citizens
perceived that the climate change was a severe environmental
challenge.
5.1.2 Research Methods
Our work focused on the impact of energy policy, and a proposed
carbon tax, on energy poverty
in Chile.
To start, we identified suitable, well established indicators
for energy poverty and calculated
baselines for Chile. The three indicators selected were:
(1) The Ten Percent Rule (TPR). As proposed by Boardman (1988),
a household is considered in
energy poverty when it dedicates more than 10% of its disposable
income to pay for an
adequate level of energy services.
(2) An adaptation of the indicator based on the lowest minimum
income standard (MIS). As
proposed by Moore (2012), this refers to the minimum income that
allows the members of the
household to choose and consume to satisfy the needs implied in
a society.
(3) The Low Income and High Cost (LIHC), which is the recent
indicator recommended and
adopted by Hills (2012) and is now the official energy poverty
indicator for England. Here
households are in energy poverty if they experience a
combination of relatively low income
and relatively high energy expenditure.
The results of these, for Chile as a whole, are shown by income
decile in Figure 1 below. Overall
energy poverty with the TPR indicator is 12.9%; with the MIS, it
is 15.7%; and, with the LIHC, it is
5.2%.
3 La Tercera newspaper:
http://www.msn.com/es-xl/noticias/other/ministro-pacheco-sin-energ%c3%ada-no-es-posible-crecer-lo-que-la-econom%c3%ada-de-chile-puede-crecer/ar-AAPBvK
[Accessed 09 November 2016].
http://www.msn.com/es-xl/noticias/other/ministro-pacheco-sin-energ%c3%ada-no-es-posible-crecer-lo-que-la-econom%c3%ada-de-chile-puede-crecer/ar-AAPBvKhttp://www.msn.com/es-xl/noticias/other/ministro-pacheco-sin-energ%c3%ada-no-es-posible-crecer-lo-que-la-econom%c3%ada-de-chile-puede-crecer/ar-AAPBvK
-
D3.3: A final brief of 14 country case studies Page 35
Figure 1 Poverty Rate of households, using three chosen
indicators
Source: Own elaboration based on Hills (2012)
Note that energy poverty varies significantly by household type
and location. For example, single-
person households have higher rates of fuel poverty in the
Metropolitan Region (18.3%) than in
other regions (13.7%). In contrast, households with larger
numbers of people, whether adult or
dependent, have a substantially higher fuel poverty rate in
other regions (15.1%), compared to
the poverty rate in the Metropolitan Region (12.7%).
Having calculated our baselines, we considered four scenarios.
These varied according to different
assumptions of levels of uncertainties in investment in the
energy sector. The sources of
uncertainty are (1) the cost of solar investment, (2) liquefied
natural gas (LNG) prices, and (3) the
potential use of hydroelectricity in the most southern area of
Chile.
The first scenario is a moderate case in terms of solar
investment costs and LNG prices, but the
development of large hydroelectric projects in the south of
Chile is not considered. Similarly, the
second scenario, does not consider hydroelectric projects in the
south, although, unlike scenario
1, it entails relatively low solar investment. Scenario 3 is
similar to scenario 1, but it considers an
additional potential of 2,750 MW from hydroelectric projects in
southern Chile. Finally, scenario
4 is like scenario 1, but it is more optimistic in terms of LNG
prices.
Our analysis then proceeded in two stages. First, we used the
results of Benavides, Gonzales et al
(2015), which simulate the level of increase in electricity
prices for consumers when a CO2 tax is
implemented. In this paper, scenarios are simulated for tax
levels of 5, 10, 20, 30, 40, and 50 US
dollars per ton of CO2.
In a second stage, and, with the simulated electric price
increase range, we proceeded to calculate
the increase in electricity expenditure of each household. For
this exercise, we used the price-
-
D3.3: A final brief of 14 country case studies Page 36
elasticity for residential electricity demand presented in
Agostini et al (2016) equal to (-0.38 to -
0.40)4 - the increase in electricity costs in each household
increases according to the increase in
electric prices. We then calculate how many households increase
their energy expenditure, after
the implementation of the carbon tax, and assessed whether they
were then energy poor,
according to the MIS criterion.
The model used in this exercise consisted of two environments.
The first was a Dynamic Stochastic
General Equilibrium model that represents the Chilean economy
with a simple representation of
the energy sector. The second environment is a minimising
electricity cost model. The interaction
of these two models is described in detail in our associated
documents (see 5.2).
5.1.3 Findings
The results of our energy poverty calculations under the
different scenarios and levels pf carbon
tax are shown in Table 3.
Table 3 Households in Energy Poverty, according to the "Ten
Percent Rule," after the implementation of the CO2 tax
CO2 Tax 5 10 20 30 40 50
Scenario 1 15.85% 15.89% 15.94% 16.00% 16.11% 16.16%
Scenario 2 15.86% 15.89% 15.94% 15.99% 16.06% 16.11%
Scenario 3 15.85% 15.89% 15.94% 15.98% 16.06% 16.11%
Scenario 4 15.85% 15.89% 15.94% 16.00% 16.11% 16.19%
It is interesting to note that poverty rates do not vary
significantly between energy scenarios, but,
rather by tax levels. The scenario of a CO2 tax of US $5
corresponds to energy poverty rates of
15.85%, whilst with the US $50 tax per ton of emissions the
energy poverty rate reaches 16.1% -
an increase of 11,900 households. These households that fall
into poverty after the tax are
vulnerable to energy policy. In this way, there are households
that are harmed by the
implementation of the policy, due to increases in electricity
prices.
4 This estimation is in line with previous works like Benavente
et al (2015) and Marshall (2010)
-
D3.3: A final brief of 14 country case studies Page 37
We then examined how compensation could be provided to
households by means of some fiscal
transfer, maintaining the tax of US $5 per ton of CO2 emissions.
This would allow the emission
reduction generated by the policy, without affecting households.
Table 3 shows the fiscal cost of
compensating households in each of the income deciles for the
increase in electricity prices.
Under this compensation scheme, the negative effect on family
budgets is avoided, and a rising
rate of fuel poverty is prevented. The results are shown in
Figure 2. Interestingly, the fiscal cost
per decile, and even the total fiscal cost of compensating these
households, is very limited and is
never greater than 28.5 million dollars for the different
scenarios. In this case the net tax
collection would be US $151.5 million. Focusing solely on the
first four deciles, the total fiscal
cost of compensating would be US $9.3 million. Conversely,
focusing on the first six deciles would
reach a higher fiscal cost, of US $ 15.5 million.
Figure 2 Compensating variation households for the highest price
of electricity, Millions of dollars
To summarise, our study shows that energy expenditure by
households experiencing (or at risk of
experiencing) energy poverty would be higher if a carbon tax is
implemented, causing harm to
these households. However, it is possible to compensate them by
means of subsidies, for example,
through household electricity bills. This policy has a limited
fiscal cost and, therefore, allows the
state to retain a significant portion of the tax revenue from
the carbon tax policy implementation.
These compensation schemes allow the offsetting of some of the
negative effects of this type of
policy.
The compensation policy does not correct negative effects on
production, which were illustrated
in Benavides et al. (2015), but does, at least, compensate
consumers. From this point of view, to
assess the feasibility of compensating for the negative effects,
it is important that all taxes on the
energy sector, as well as on other public policies, include not
only an impact assessment on the
-
D3.3: A final brief of 14 country case studies Page 38
economy and productivity (something that the Government of Chile
has advanced in recent years)
but also an impact assessment on individuals and households.
This is something that must still be
incorporated into our public policies.
-
D3.3: A final brief of 14 country case studies Page 39
5.2 Case Study Outputs
Output Category Date Link
Stakeholders meeting Note in web page 9th June
2017
http://www.clapesuc.cl/intensa-agenda-
transrisk-chile/
Op Ed in La Tercera Op Ed article 29th June
2018 Not available
Article JiQ Magazine ‘Magazine on climate and sustainability’
Policy Brief July 2017 http://jin.ngo/jiq-magazine/10-jiq-
magazine/200-jiq-july17
TRANSrisk Policy Presentation Seminar, ‘Cambio Climático y
Desarrollo Sustentable en Chile’ ClapesUC Policy
presentation
8th June
2018
http://www.clapesuc.cl/investigaciones/
seminario-cambio-climatico-desarrollo-
sustentable-chile-ppt-luis-e-gonzales/
-
D3.3: A final brief of 14 country case studies Page 40
TRANSrisk Workshop ‘Assessing Uncertainties and Risk in the
Transition to Low Carbon and Sustainable Societies’ at
Basque
Center for Climate Change BC3
Presentation
3rd and
4th July
2017
http://www.clapesuc.cl/clapes-uc-
participa-seminario-espana/
Article in EMOL newspaper, ‘Estudio revela que casi 500.000
hogares en Chile están expuestos a la vulnerabilidad energética’
Press article
19th June
2017
http://www.emol.com/noticias/Economi
a/2017/06/19/863303/Vulnerabilidad-
energetica-480000-hogares-en-Chile-
estan-expuestos-a-ella.html
Article in La Tercera newspaper Press article 19th June
2017
http://www2.latercera.com/noticia/chil
e-vulnerabilidad-energetica/
Springer book chapter, ‘Nuclear safety developments in
Springfield’’
Scientific book
chapter
To be
publish
TRANSrisk Paper, “Socioeconomic Impacts of Air Pollution in
the
Chilean Metropolitan Area” Scientific Paper
9th May
2017
http://www.transrisk-
project.eu/sites/default/files/Document
s/4.4.2_Socioeconomic%20Impacts%20of%
20Air%20Pollution%20in%20the%20Chilean
%20Metropolitan%20Area.pdf
-
D3.3: A final brief of 14 country case studies Page 41
Working paper, ‘Pobreza energética e impuesto a las
emisiones
de Co2 en Chile’ ClapesUC Scientific paper
6th June
2017
http://www.clapesuc.cl/assets/uploads/
2017/06/27-06-17-cerda-y-gonzales-
2017-vf.pdf
Presentation ‘Desarrollo Productivo, Justicia Social y
Sostenibilidad Ambiental’ at Universidad Catolica Boliviana
Seminar
Participation
10th
October
2017
TRANSrisk Workshop, ‘Cambio Climático y Desarrollo
Sustentable
en Chile’ Video of Workshop
12th June
2017
http://www.clapesuc.cl/video/seminario
-cambio-climatico-desarrollo-
sustentable-chile/
Tackling climate change can improve public health Website
article
(CCM.eu)
2nd June
2017
http://climatechangemitigation.eu/2017
/06/tackling-climate-change-can-
improve-public-health/
-
D3.3: A final brief of 14 country case studies Page 42
5.3 Case Study Outreach and Impact (also Expected
Outreach and Impact)
Preliminary findings from our case study were presented at the
TRANSrisk Seminar organised by
Centro Latinoamericano de Políticas Económicas y Sociales
(ClapesUC) (link). Stakeholders from
civil society, academics and government participated in the
seminar. In particular, the Chilean
sub secretary of Energy Mr Ricardo Irrarazabal was one of the
speakers in the panel. Following this
we were invited to present our results in several instances at
government Ministries and we were
interviewed by the newspapers El Mercurio On Line (EMOL) (link)
and La Tercera (link).
After this media coverage we were invited to participate in the
Red de Pobreza Energética (RedPE)
together with multidisciplinary members from all over the
regions in Chile (link). Subsequently,
the government proposed our work as official policies to work on
energy vulnerability during their
four years term (link).
http://www.clapesuc.cl/video/seminario-cambio-climatico-desarrollo-sustentable-chile/http://www.emol.com/noticias/Economia/2017/06/19/863303/Vulnerabilidad-energetica-480000-hogares-en-Chile-estan-expuestos-a-ella.htmlhttp://www2.latercera.com/noticia/chile-vulnerabilidad-energetica/http://redesvid.uchile.cl/pobreza-energetica/miembros/https://www.latercera.com/opinion/noticia/encarando-la-vulnerabilidad-energetica-paso-mas-hacia-desarrollo/225153/
-
D3.3: A final brief of 14 country case studies Page 43
6 CHINA: GREEN BUILDING
6.1 Case Study Summary
6.1.1 Context/ Background
China has become both the world’s largest energy producer and
consumer. It has a comprehensive
energy supply system based on coal, electricity, oil, natural
gas and renewable energy, meeting
the basic demands for socio-economic development. However,
China’s energy production and
consumption are also facing difficult challenges to decarbonise,
due to its rapid economic
development, abundant endowment of coal, population growth and
urban development.
The country has experienced the quickest economic expansion of
any major economy in the world,
and has taken 500 million of its population out of property
(World Bank, 2018). Today, China is
the second largest economy in the world, with an overall GDP of
67.67 trillion yuan (11.06 trillion
US Dollars) in 2015 (Bureau, 2016a). This growth has been
accompanied by increasing energy
demand. Economic growth is now slowing, falling to 6.9% in 2015
compared with the average rate
of 9.7% from 1979 to 2014. During the “13th Five Year Plan”
(2016-2020) period, China’s potential
average growth rate is expected to drop to 6.3%, indicating that
China’s economy is transitioning
from high growth to medium-high growth.
China also has substantial resources of coal. Even though the
energy supply and consumption
structure has been improving in China, long term socio-economic
development will still rely on
coal consumption, resulting in rising carbon emissions. Energy
consumption in the building,
transport and daily living sectors in particular will keep on
increasing. As of 2014, transport and
housing have become the largest growth areas for energy
consumption in China (Li, 2014).
In addition, as the world’s most inhabited country, China’s
population exceeded 1.38 billion in
2016. Urbanisation levels reached over 57% - around 3% higher
than the global average. (National
Bureau of Statistics of China, 2018a) Although the speed of
urbanisation has slowed somewhat -
down from nearly 4% in 2010 to around 2.5% in 2016 - the urban
population is expected to reach
65% by 2020 (THUBERC). Along with urban population growth,
rising living standards in cities,
locked-in energy infrastructure and transport related activities
will contribute significantly to
increasing carbon emissions. Cities will therefore need to make
major carbon emission reductions
in the present and future.
Increasing urban population and density had fuelled the rapid
development of the building
industry, and has driven energy consumption growth in China. The
construction industry
contributed 26.4% of China’s GDP, and building energy use
accounted for 33% of the total energy
use in China in 2015 (Yuan, Zhang et al. 2017). Total carbon
emission from China’s building sector
-
D3.3: A final brief of 14 country case studies Page 44
have increased from 985 million tons of CO2 in 2005 to 3,754
million tons in 2014. Between 2001
and 2014, both primary energy consumption and electricity
consumption in China’s building sector
increased more than two-fold. Rapid urbanisation and economic
development has driven the
demand for higher quality living space, including improved
indoor comfort, with a corresponding
increase in energy consumption. Therefore, energy conservation
in new buildings and increasing
demand in the existing building stock has become one of the
largest challenges for China’s energy
conservation and emissions-reduction work (IEA 2015). Building
energy conservation plays an
important role in ensuring emissions peak before 2030, a
commitment set by the Chinese
government in China’s Nationally Determined Contribution (NDC)
under the Paris Agreement.
Guidance and support from government policies are crucial for
achieving the energy conservation
targets for the building sector. Through national regulations
and plans related to building energy
conservation, this research describes the low carbon transition
pathways of building sector in
China.
The transition pathway presented in this narrative will focus on
residential buildings in urban
areas. Energy consumption in public and commercial buildings
represents a dominant share in
China’s building sector, which is almost three times that of
residential building in rural or urban
areas. However, rapid urbanisation has boosted continuous
development and scaled-up the
construction industry, especially in residential buildings.
Among the new buildings in China, the
construction areas of residential housing accounted for about
75% and public buildings 25%
(Bureau, 2016c). Furthermore, residential buildings in urban
areas reached the highest energy
consumption. For instance, space and water heating in the north
urban buildings is the largest
energy consumer, making up 52% of the total building energy
consumption. In addition, demand
for space heating for southern households in urban areas has
been increasing rapidly due to climate
change and higher living space comfort (China Statistical
Yearbook on Construction, 2014;2015
Annual Report on China Building Energy Efficiency, 2015).
A low-carbon transition in residential buildings is more
complicated than other building categories.
The increased complexity is due to: the wide range of housing
types; differences in household
demographics; varying climate conditions across China that
impact households’ ability to regulate
indoor temperature; and economic-social contexts such as the
housing rental market, social
custom and culture.
6.1.2 Research Methods
The study was based on a qualitative research design that
includes two methodical approaches:
stakeholder analysis (workshop and interviewing) and policy
document analysis.
The data collection started with governmental documents,
archives and related literature reviews
that covered the more than 50 documents issued by national
governments and more than 19
regulations or programs in the local level. These documents
helped identify key factors, processes,
actors and the political framework of the building context.
Based on that, a key set of questions
-
D3.3: A final brief of 14 country case studies Page 45
was discussed with stakeholders in workshops and interviews,
which developed a general
understanding of transition pathway in building sector:
(1) Is the current policy mix deemed adequate for achieving the
desired green transition in the
building sector? What additional policies are required to
promote the transition pathway?
(2) What are the barriers and challenges in the implementation
of transitioning the building
sector? What are the criteria from the stakeholders for
estimating them?
(3) What are the (positive or negative) impacts of green
transitions on the social-technological
structures?
Furthermore, the participatory research approach contributed to
provide a multiplicity of opinions
and perceptions about the driver factors, implementation risks,
consequential risks and
uncertainty under green building pathways in different climate
zones.
Three workshops and two focus group interviews were held in
Beijing and Shanghai respectively.
The participants in each focus group were invited from different
stakeholder groups including local
governments, architects, constructors, NGOs, experts for green
building design, urban planning
and low-carbon technologies and researchers. The events counted
a total of 189 participants,
including 132 governmental officials, 18 experts, 6 architects,
6 NGOS, 4 constructors, 8 residents
and 21 researchers. The workshops helped in identifying the
transition pathway, achieving a
general understanding of the drivers for uptake by stakeholders
and barriers to green transition.
In the interview part, it aimed to gain in-depth expert and
practitioner knowledge. Most of the
participants came from the local administration and experts in
Beijing and Shanghai’s building
sectors, which identified the risk categorisations
(implementation and consequential risks, as well
as uncertainty) and their potential impacts under the transition
pathway for the building sector.
As a third step, under the qualitative outline of the pathway
and its risks (or uncertainties),
quantitative modelling may help in addressing the potential
impacts from the risks in the multiple
scenarios. Further validation of the model’s output would be
improved by feedback and comments
from the stakeholders.
6.1.3 Findings
From the pathways studied, the low carbon transition pathway in
China’s green building sector
emphasises the present policy ambition to scale up green
buildings through increasing energy
efficiency and promoting renewable energy in buildings. The
pathway considers the existing
energy policies and urbanisation strategies in China and
explores the risks and uncertainties in the
green building transition pathway, drawing on examples from
cities in northern and southern
climatic regions.
From the risk analysis of the transition pathways,
implementation risks identified differed between
stakeholders’ perspectives; stakeholders included those from
government (local and national),
construction firms, public residents and area experts. However,
implementation risks mainly
-
D3.3: A final brief of 14 country case studies Page 46
derived from four clusters including: policies, technology
innovation, financing and energy
consumption behaviour. In the low carbon building pathways, the
stakeholders highlighted lack of
policies for green building operation and financial policies to
incentivise renewable energy use as
a priority risk. However, the locked-in behaviour of building
end-users and technological
innovation would be the main barriers in the future transitions
of green new buildings and
retrofitting existing buildings.
Stakeholders also mentioned that energy saving technologies for
the enclosure structure and
equipment systems often failed to consider the local needs to
control indoor temperature based
on the local climate zone. Energy efficiency measures in
northern regions, which has relatively
dry cold and hot conditions, cannot be directly replicated in
the more humid southern regions
where building require additional ventilation.
Aside from different user needs, awareness of cost-benefits
analysis for green buildings is still
weak in the design of Chinese buildings. Besides this,
stakeholders from the governmental and the
public groups considered that the efficiency of equipment
systems still suffer from a lack of
innovation. This especially applies to passive energy saving
technology and heating (air
conditioning) system based on the full use of renewable energy
such as solar and wind. For
instance, most buildings still rely on air conditio