Modeling cost-effective climate change mitigation strategies

The challenge of reducing anthropogenic emissions of greenhouse gases calls for a wide variety of analyses to make the mitigation effort efficient and achievable. This thesis explores five different issues related to carbon abatement. The first paper examines interactions between the stationary energy sector and the transportation sectors in a carbon constrained world. We find that an energy system dominated by solar energy or nuclear energy tends to make biofuels in plug-in hybrids cost-effective in a 400 ppm carbon dioxide scenario. If instead coal with carbon capture and storage dominates the energy system, hydrogen cars rather than plug-in hybrids tend to become cost-effective. From a Monte Carlo analysis we conclude that the stationary energy system does not alone determine how the transportation sector develops, but that its impact on the absolute and the relative cost of energy carriers has a significant impact. The second paper examines induced technological change in a global energy system model with limited foresight. We find that the introduction of induced technological change reduces the total net present value of the abatement cost over this century by 3-9% (depending on the stabilization target) compared to a case where technological learning is exogenous. Further, we show that technology-specific policies can counter technology lock-in and reduce the abatement cost compared to a case with cap and trade system only. The third paper concerns land-use competition between bioenergy plantations that reduce fossil fuels in the energy sector and long-lived carbon sinks that sequester and store atmospheric carbon. These two abatement options may compete for the same land under a stringent climate target. Using an energy system model we examine whether bioenergy or carbon sinks are the most cost-effective option. We show that long-rotation forests for the purpose of carbon sequestration will not be cost-effective in the long run under a stringent climate policy. Thus, economic efficiency considerations tend to favour short-rotation plantations for high carbon prices. In the fourth paper a framework for analyzing the impact of energy policies in the EU-25 on the expected cost of oil disruptions is developed. We find that substituting pellets for oil in households is a cost-efficient policy if greenhouse gas benefits are included. Neither domestically-produced wheat ethanol nor hybrid cars are found to be cost-efficient, even if both the expected cost of oil disruption and greenhouse gas benefits are included. In the fifth paper we investigate global income and resource inequality from 1960 to the late 1990s. We find that the inequality in terms of GDP/capita measured in purchasing power parity terms is rather stable in relative terms, but increasing in absolute terms. We also conclude that resource inequality tends to improve faster than income inequality, even though inequality in electricity and paper consumption in absolute terms has increased significantly since the 1960s