Developing World

Climate Change Mitigation in Developing Countries: Brazil, China, India, Mexico, South Africa, and Turkey

Download Report

Climate Change Mitigation in Developing Countries: Brazil, China, India, Mexico, South Africa, and Turkey

Prepared for the Pew Center on Global Climate Change
October 2002

By:
William Chandler,Battelle Memorial Institute
Roberto Schaeffer, Federal University of Rio de Janeiro
Zhou Dadi, China Energy Research Institute
P.R. Shukla, Indian Institute of Management
Fernando Tudela, El Colegio de Mexico
Ogunlade Davidson, University of Cape Town
Sema Alpan-Atamer, Med-Consult, Turkey

Press Release

Download Entire Report (pdf)

Download Report (ZIP file)

Foreword

Eileen Claussen, President, Pew Center on Global Climate Change

One of the most contentious issues in the debate over global climate change is the perceived divide between the interests and obligations of developed and developing countries. Equity demands that developed countries-the source of most past and current emissions of greenhouse gases-act first to reduce emissions. That principle is embedded in the 1992 United Nations Framework Convention on Climate Change and in the 1997 Kyoto Protocol, which sets binding emission targets for developed countries only. With the Protocol now likely to enter into force, the focus will turn increasingly to the question of developing country emissions.

Addressing climate change in developing countries poses a fundamentally different challenge. For most, emission reduction is not a viable option in the near term. With income levels far below those of developed countries-and per capita emissions on average just one-sixth those of the industrialized world-developing countries will continue to increase their emissions as they strive for economic growth and a better quality of life. But their steadfast resistance to the idea of limiting their emissions has led to claims in some quarters that developing countries are not doing their fair share. Indeed, the Bush administration, in rejecting Kyoto, declared the Protocol unfair to the United States because it does not mandate action by large developing countries.

Accepting emission limits, however, is not the only measure of whether a country is contributing to climate change mitigation. Efforts that serve to reduce or avoid greenhouse gas emissions, whether or not undertaken in the name of climate protection, nonetheless contribute to climate mitigation. These efforts can occur across virtually every sector of an economy. This report seeks to document and quantify the climate mitigation resulting from such efforts in six developing countries-Brazil, China, India, Mexico, South Africa, and Turkey.

The report demonstrates that efforts undertaken by these six countries have reduced their emissions growth over the past three decades by approximately 300 million tons a year. Further, it finds that many of these efforts are motivated by common drivers: economic development and poverty alleviation, energy security, and local environmental protection. Put another way, there are multiple drivers for actions that reduce emissions, and they produce multiple benefits. The most promising policy approaches, then, will be those that capitalize on natural synergies between climate protection and development priorities to simultaneously advance both.

Just as equity demands that developed countries act first, the physical workings of our planet demand that in time developing countries limit and, ultimately, reduce their emissions as well. The search for consensus on an equitable sharing of responsibility must begin with a fair accounting of how nations already are contributing to this common effort. The authors and the Pew Center gratefully acknowledge Charles Feinstein, Alan Miller, Jiahua Pan, Cedric Philibert, and Leena Srivastava for their review of previous drafts of this report.

Executive Summary

Greenhouse gas emissions from developing countries will likely surpass those from developed countries within the first half of this century, highlighting the need for developing country efforts to reduce the risk of climate change. While developing nations have been reluctant to accept binding emissions targets, asking that richer nations take action first, many are undertaking efforts that have significantly reduced the growth of their own greenhouse gas emissions. In most cases, climate mitigation is not the goal, but rather an outgrowth of efforts driven by economic, security, or local environmental concerns. This study attempts to document the climate mitigation resulting from such efforts in six key countriesBrazil, China, India, Mexico, South Africa, and Turkeyand to inform policy-making aimed at further mitigation in these and other developing nations.

The six countries examined here reflect significant regional, economic, demographic, and energy resource diversity. They include the worlds two most populous nations, a major oil exporter, Africas largest greenhouse gas emitter, and the country with the largest expanse of tropical forest. While their circumstances vary widely, these countries share common concerns that have motivated actions resulting in reduced greenhouse gas emissions growth. Primary among these concerns are economic growth, energy security, and improved air quality. The analysis presented here demonstrates that actions taken by these countries to achieve these and other goals have reduced the growth of their combined annual greenhouse gas emissions over the past three decades by nearly 300 million tons a year. If not for these actions, the annual emissions of these six countries would likely be about 18 percent higher than they are today. To put these figures in perspective, if all developed countries were to meet the emission targets set by the Kyoto Protocol, they would have to reduce their emissions by an estimated 392 million tons from where they are projected to be in 2010.1

The six case studies identify a broad range of mitigation activities and potentials:

Brazil's annual emissions are 91 million tons, or 10 percent lower than they would be if not for aggressive biofuels and energy efficiency programs aimed at reducing energy imports and diversifying energy supplies. A tax incentive for buyers of cars with low-powered engines, adopted to make transportation more affordable for the middle class, accounted for nearly 2 million tons of carbon abatement in the year 2000. If alcohol fuels, renewable electricity, cogeneration, and energy efficiency are encouraged in the future, carbon emissions growth could be further cut by an estimated 45 million tons a year by 2020. Deforestation, however, produces almost twice as much carbon dioxide as the energy sector. Government policy, with few exceptions, indirectly encourages emissions growth in the forestry sector.

China has dramatically reduced its emissions growth rate, now just half its economic growth rate, through slower population growth, energy efficiency improvements, fuel switching from coal to natural gas, and afforestation. Emissions growth has been reduced over the past three decades by an estimated 250 million tons of carbon per year, about one-third of China's current emissions. Continued policies for economic reform, efficiency, and environmental protection could reduce emissions growth by an additional 500 million tons a year in 2020.

India's growth in energy-related carbon dioxide emissions was reduced over the last decade through economic restructuring, enforcement of existing clean air laws by the nation's highest court, and renewable energy programs. In 2000, energy policy initiatives reduced carbon emissions by 18 million tons-over 5 percent of India's gross carbon emissions. About 120 million tons of additional carbon mitigation could be achieved over the next decade at a cost ranging from $0-15 per ton. Major opportunities include improved efficiency in both energy supply and demand, fuel switching from coal to gas, power transmission improvements, and afforestation.

Mexico was the first large oil-producing nation to ratify the Kyoto Protocol. Major factors affecting Mexican greenhouse gas emissions are population growth, economic development, energy supply growth, technological change, and land use change. Mexico has begun to reduce deforestation rates, switch to natural gas, and save energy, reducing annual emissions growth over the last decade by 5 percent, or 10 million tons of carbon per year. Mexican carbon dioxide emissions are projected to grow 69 percent by 2010, but alternative strategies could cut this growth by 45 percent.

South Africa's post-Apartheid government places its highest priority on development and meeting the needs of the poor. Over one-third of the nation's households are not even connected to a power grid. Yet, emissions growth could be reduced 3-4 percent a year by 2010 through efforts to reform the economy and improve energy efficiency. The government is already taking steps to phase out subsidies to its unusual, carbon-intensive coal liquefaction industry and to open the country to natural gas imports. As in many other developing countries, the absence of rigorous and publicly available studies of future energy use and greenhouse gas emissions remains an obstacle to future emissions mitigation.

Turkey's high rate of energy-related carbon emissions growth is expected to accelerate, with emissions climbing from 57 million tons in 2000 to almost 210 million tons in 2020. Carbon intensity in Turkey is higher than the western developed nation average. Energy-intensive, inefficient industries remain under government control with soft budget constraints, contributing to undisciplined energy use. Planned industrial privatizations may close the oldest and most inefficient operations and modernize surviving ones. Elimination of energy price subsidies could stimulate energy conservation, reducing energy and emissions growth below current projections.

Taken together, these six country studies support four broad conclusions:

  • Many developing countries are already taking action that is significantly reducing their greenhouse gas emissions growth.
  • These efforts are driven not by climate policy but by imperatives for development and poverty alleviation, local environmental protection, and energy security.
  • Developing nations offer large opportunities for further emissions mitigation, but competing demands for resources may hamper progress.
  • Developing countries can use policies to leverage human capacity, investment, and technology to capture large-scale mitigation opportunities, while simultaneously augmenting their development goals.

The six case studies also identified common barriers to climate mitigation. In many cases, the lack of good data impedes efforts to identify and realize mitigation potential. Insufficient human capacity-to analyze energy and emission futures, identify mitigation opportunities, execute economic reforms, and cultivate investment opportunities-represents another significant barrier. In most countries, public control of at least a portion of energy resources works against emissions mitigation by preventing the emergence of more efficient private actors.
Finally, a range of concerns-from the absence of transparency and rule of law to the extra risk associated with nontraditional energy investment-impedes investment and technology transfer that would contribute to emission mitigation.

The experiences of these six countries have implications for future policy at multiple levels-for national efforts within developing countries, for the evolving international climate framework, and for other bilateral or multilateral efforts aimed at encouraging emission reduction in developing countries.

One broad lesson, given the diversity of drivers and co-benefits, is the need at both the national and international levels for flexible policy approaches promoting and crediting a broad range of emission reduction and sequestration activities. Other policy priorities include: continuing to promote market reforms, such as more realistic energy pricing, that can accelerate economic growth while reducing emissions growth; working within developing countries and through bilateral and multilateral efforts to improve investment environments and create stronger incentives for climate-friendly investments; targeting capacity-building assistance to most effectively capitalize on natural synergies between climate mitigation and other development priorities; and supporting policies that address both climate and local environmental needs, such as improving air quality and reducing deforestation.

While this analysis has documented significant greenhouse gas mitigation in key developing countries, energy use and emissions will continue to climb as these countries attain higher levels of development. Far greater efforts to reduce emissions in both developed and developing countries will be required in the coming decades to avert the worst consequences of global climate change. These efforts must include stronger national policies as well as an evolving international regime that ensures adequate efforts by all major emitting countries. By highlighting the current and potential contribution of developing countries to emission mitigation, this report aims to enhance the prospects for stronger international cooperation toward the shared goal of climate protection. 

0

Transportation in Developing Countries: Greenhouse Gas Scenarios for South Africa

Download Report

Transportation in Developing Countries: Greenhouse Gas Scenarios for South Africa

Prepared for the Pew Center on Global Climate Change
February 2002

By:
Jolanda Pretorius Prozzi, Cambridge Systematics
Clifford Naudé, Council for Scientific and Industrial Research: Transportek, South Africa
Daniel Sperling and Mark Delucchi, University of California, Davis

Press Release

Download Entire Report (pdf)

Foreword

Eileen Claussen, President, Pew Center on Global Climate Change

South Africa has relatively high aggregate and per capita greenhouse gas (GHG) emissions compared to other developing countries, and to world averages. Transportation sector emissions are increasing, but climate change competes with urgent economic, social, and public health concerns for government attention. As a party to the UN Framework Convention on Climate Change and an active participant in the Kyoto Protocol negotiations, South Africa may be able to address transportation emissions through projects under the Protocol's Clean Development Mechanism.

The two major forces affecting South Africa's transportation sector are the country's legacy of apartheid and privatization. Apartheid-era policies cause high greenhouse gas emissions in two ways: (1) Blacks lived in separate townships and homelands, forcing them to travel long distances to jobs in commercial or white residential areas; and (2) anti-apartheid sanctions resulted in South Africa using high-carbon synthetic fuels based on domestic coal and boosting the local vehicle manufacturing industry. Privatization in the 1980s resulted in freight transportation shifting from rail to more energy-intensive trucks. Intense competition within the trucking industry has resulted in poor maintenance and extended use of inefficient vehicles by small entrepreneurial companies. This problem is more widespread in the minibus 'jitney' sector, which evolved to serve the unmet travel needs of black South Africans.

This report creates two scenarios of greenhouse gas emissions in 2020. In the high business as usual scenario, residual land use policies continue to aggravate transportation problems. Personal car use accelerates as car prices drop and consumer credit becomes more widely available. In the low GHG scenario, mobility, accessibility, and safety concerns drive the government to play an active role in land use and transportation policies. More efficient use of urban land and energy resources improves the quality of life and reduces GHG emissions. Low-emissions scenario strategies are not necessarily costly but require strong political commitment.
Some key results are:

  • GHG emissions increase 82 percent in the high scenario; but decrease 12 percent in the low scenario.
  • Coordinating land use, housing, and passenger transportation policies would promote more efficient urban land use patterns that reduce travel distances and correct spatial imbalances.
  • Both (1) restructuring commuter services so that rail serves the densest population centers, buses serve secondary routes, and minibus jitneys provide feeder or local services; and (2) dedicated taxes on vehicle purchases and use, would improve and help sustain public transportation.
  • Changing technology, such as cleaner feedstock for synthetic fuel, would reduce GHG emissions.
  • Providing incentives to domestic auto manufacturers to produce buses and minibuses instead of cars would reduce the car orientation of the transportation system.

Transportation in Developing Countries: Greenhouse Gas Scenarios for South Africa is the third report in a five-part series examining transportation sector GHG emissions in developing countries. The findings are based on a Lifecycle Energy Use and Emissions Model developed by the Institute of Transportation Studies at the University of California at Davis, which estimates GHG emissions from the transportation sector. The Pew Center gratefully acknowledges Ogunlade Davidson of the University of Cape Town, Ralph Gakenheimer of MIT, Talia McCray of the Université de Laval, and Michael Walsh, an independent transportation consultant, for their review of earlier drafts. 

Executive Summary

The performance and structure of South Africas transportation system is largely explained by two phenomena: the legacy of apartheid and privatization. Apartheid had far-reaching impacts, even extending deep into the country's transportation and energy system. Largely as a result of these policies, the country's contributions to global greenhouse gas (GHG) emissions are high compared to those of other African nations, both in aggregate and per capita terms. Some of the transportation and energy effects of apartheid include the following:

  • Land use policies were based on race and ethnicity, in which black residential areas were moved to the outskirts of growing urban areas and beyond, creating long commuting distances for most of the black poor.
     
  • Energy investments in innovative coal-based synthetic fuel processes were greatly expanded following international sanctions during the 1970s and 1980s.
  • Import substitution economic policies promoted the domestic motor vehicle manufacturing industry.
     
  • Generous company car allowances and subsidized vehicle schemes nurtured a market for private cars to support the domestic auto industry.
     
  • Public transportation services designed to serve long-distance commuters with low levels of service inspired black entrepreneurs to create informal services by minibus jitneys - van-type vehicles - for the many unserved travel needs. These services tend to be provided with inefficient vehicles resulting in higher energy consumption and emissions.
     

The good news is that South Africa has emerged from decades of apartheid policies with a functioning economy and extensive social and physical infrastructure. The bad news is that besides creating pervasive economic and social problems, apartheid polices led to a set of travel behaviors and transportation-related investments that increased energy use and GHG emissions.

Privatization is a second major phenomenon shaping South Africa's transportation system and its energy and environmental performance. The country is steadily privatizing both its passenger and freight transportation systems, largely because of shrinking government funds and an inability to manage urban sprawl. The effects of privatization in the transportation sector have been positive in many ways - including expanded transit service and lower freight costs. But dwindling government subsidies and rapid growth in minibus jitney services have led to sharp ridership losses on the extensive rail and bus systems. This change has resulted in more energy use, GHG emissions, pollution, road deaths, and, paradoxically, continuing urban sprawl.

Minibus jitneys have come to dominate the provision of passenger transportation services. They are almost totally owned by black South Africans. In only two decades, jitneys have expanded to account for two-thirds of all public transportation services and over one-third of total passenger travel in South Africa. They are expensive relative to bus and rail transit, but ubiquitous, providing service to many poor travelers. Financial problems in the minibus jitney industry have led to increasingly old, dilapidated, uncomfortable, and unsafe vehicles, resulting in higher energy consumption and GHG emissions. The government is now attempting to organize and regulate the minibus jitney sector.

Privatization in the freight sector has also propelled large modal shifts from rail to truck. Until 1988, trucks were not allowed to compete with the government-owned railroad. When the freight sector was deregulated in 1988, truck use rapidly expanded, resulting in lower freight tariffs, and a large drop-off in rail use.

Overall, the combined effect of privatization and the apartheid legacy is inflated travel demand, growing use of motor vehicles and trucks, and use of high-carbon fuels. The challenge is to devise policies and strategies to redirect these behaviors and investments to create a more economical, environmental, and socially beneficial transportation system.

Numerous policy options exist to reduce GHG emissions from the transportation sector. These policies affect when, how, where, and why people travel. Options range from adopting efficient advanced vehicle technologies to various administrative controls (including parking controls and car restriction zones) and economic measures (including additional vehicle and fuel taxes).

Environmental quality is not a high priority in South Africa, one of the few countries that does not regulate motor vehicle emissions of air pollutants. However, leaders are motivated to improve mobility, accessibility, and road safety, and reduce traffic congestion. Many of the strategies targeted at those goals will restrain GHG emissions:

  • Improve accessibility and mobility. Due to racial segregation, most South Africans live far away from employment centers and economic services. Improved public transportation is the most efficient means of enhancing mobility and accessibility. Enhanced public transportation would restrain growth in the use of personal vehicles, with associated reductions in the growth of GHG emissions.
     
  • Improve road safety. Road safety is a serious concern in South Africa. Policies that improve road safety, such as enforcing speed limits, scrapping older vehicles, and improving vehicle maintenance could help reduce GHG emissions.
     
  • Reduce traffic congestion. Congestion is increasing in all major areas and is expected to become a major problem shortly. Since South Africa does not have the funding to build many more roads, an improved public transportation system will be vital to ensure mobility for the vast majority of its people.
     
  • Increase tax revenue. Increasing fuel and vehicle taxes - an important source of government revenue - would help pay for social expenditures and raise the cost of private vehicle use.
     
  • Respond to international pressure. By ratifying the United Nations Framework Convention on Climate Change, South Africa has become part of the global community that is committed to taking responsibility for its GHG emissions.
     

Two transportation scenarios were designed for South Africa - one that yielded higher GHG emissions by 2020, and one that yielded lower emissions. These scenarios draw upon extensive interviews with decision-makers and experts in South Africa.

The higher GHG scenario assumes a continuation of observable and emerging trends. In this 'business-as-usual' scenario, the government remains entangled in crisis management. It focuses on health, education and social unrest related to skewed income distributions, and ignores transportation concerns. Residual land use policies from apartheid continue to aggravate transportation problems. Cities remain divided and land developers give little consideration to the implications of long commuting distances. The automotive industry remains a pillar of economic development. Personal car use accelerates as car prices drop and consumer credit becomes more widely available.

In this scenario, private cars and minibuses increase their share of total passenger-kilometers from 51 percent in 2000 to 59 percent in 2020, while public transits share decreases from 49 to 41 percent. Minibus jitneys retain 60 percent of the public transit modal share. The effect on greenhouse gases is significant: South African emissions increase by 82 percent from 2000 to 2020.

In the lower GHG scenario, the motivation for change and government action are driven by mobility, accessibility, and safety concerns. The government plays an active role in land use policies and surface passenger transportation. Land use and housing policies are adopted that promote more efficient urban land use patterns, gradually correcting spatial imbalances and reducing travel distances. The government promotes public transportation, restructuring the minibus jitney, bus, and commuter rail sectors. Under the new structure, trains serve the routes with the densest population, buses serve the secondary routes and minibus jitneys provide feeder or local services. The sustainability of the public transportation system is ensured through revenues raised from dedicated taxes on vehicle buyers and users. South African auto manufacturers are provided with incentives to design and build buses and minibuses appropriate to the local market. Sasol, the large industrial company in South Africa that produces synthetic oil from coal, starts to use natural gas as feedstock in the production of synthetic fuel. This change would avoid the high costs of impending capital investments in coal mining, while harnessing the environmental benefits associated with the use of a cleaner feedstock.

This low-emissions scenario leads to enhanced quality of life and more efficient use of resources - urban land and energy - and decreased GHG emissions. The modal share of private cars and public transit remains approximately constant at 48 and 52 percent, respectively, but minibus jitneys suffer a significant decline in public transit modal share, from 65 percent in 2000 to 56 percent in 2020. Bus and rail transportation account for the remaining share of public transit mode share at 19 and 25 percent respectively. The result is a 12-percent decrease in GHG emissions despite the fact that passenger-kilometers increase by about 54 percent. The strategies in the low-emissions scenario are not necessarily costly, but they do require strong political will and a commitment that has yet to be demonstrated by South African leaders. 

About the Author

Jolanda Pretorius Prozzi

Ms. Jolanda Prozzi holds a Master of Science in Transportation Technology and Policy from the University of California (Davis) and a Master of Commercial Sciences from the University of Stellenbosch (South Africa), with specialization in transport economics. Ms. Prozzi has almost nine years of professional and research experience in transportation economics and policy analysis, including a number of environmental policy studies. Prior to joining the Center for Transportation Research at the University of Texas, Austin, Ms. Prozzi was a Transportation Analyst at Cambridge Systematics, Inc., a Consultant Transport Economist for the World Bank and a Researcher at the Council for Scientific and Industrial Research (CSIR): Division of Roads and Transport Technology in Pretoria, South Africa. 

Clifford Naude
Daniel Sperling
Jolanda Pretorius Prozzi
Mark Delucchi
0

Transportation in Developing Countries: Greenhouse Gas Scenarios for Shanghai, China

Download Report

Transportation in Developing Countries: Greenhouse Gas Scenarios for Shanghai, China

Prepared for the Pew Center on Global Climate Change
July 2001

By:
Hongchang Zhou, Tongji University, Shanghai
Daniel Sperling, Mark Delucchi, and Deborah Salon, Institute of Transportation Studies, University of California, Davis

Press Release

Download Entire Report (pdf)

Foreword

Eileen Claussen, President, Pew Center on Global Climate Change

The transportation sector is a leading source of greenhouse gas (GHG) emissions worldwide, and one of the most difficult to control. In developing countries, where vehicle ownership rates are considerably below the OECD average, transport sector emissions are poised to soar as income levels rise. This is especially true for China, whose imminent accession to the World Trade Organization will contribute to economic growth and could make consumer credit widely available for the first time. These factors are likely to accelerate automobile purchases, and GHG emissions.

Shanghai is one of China's most dynamic cities. Extremely densely populated, with very low personal vehicle ownership rates for its income level, Shanghai is also home to a nascent Chinese automotive industry. Transportation plans and policies there are designed to achieve broader urban objectives of population decentralization, with an eye to controlling increases in traffic congestion and improving environmental quality. Because Shanghai's transportation system and planning process are so sophisticated, Shanghai may be a 'best case' for controlling transportation sector GHG emissions in the absence of climate change mitigation goals.

This report creates two scenarios of GHG emissions from Shanghais transportation sector in 2020. It finds:

  • Greenhouse gas emissions quadruple in the low-GHG scenario; they increase sevenfold in the high scenario. On a passenger-kilometer basis, the estimated increase ranges from 10 to 100 percent.
  • Providing an array of high-quality options to travelers can help meet the demand for transportation services while keeping traffic congestion in check and meeting other urban objectives.
  • Special lanes and other infrastructure to accommodate vehicles such as buses, minicars, and bicycles can save money and improve traffic circulation.
  • Using clean technology and fuels in motorized vehicles lowers the environmental impact of various transportation modes.
  • Perfecting the use of 'intelligent' traffic control systems through improved coordination will yield higher returns on capital investments.

Transportation in Developing Countries: Greenhouse Gas Scenarios for Shanghai, China is the second report in a series examining transportation sector GHG emissions in developing countries. The report's findings are based on a Lifecycle Energy Use and Emissions Model developed by the Institute of Transportation Studies at the University of California at Davis, which estimates GHG emissions from the transportation sector.

The Pew Center would like to thank Kebin He of Tsinghua University, Feng An of Argonne National Laboratory, Ralph Gakenheimer of MIT, and Michael Walsh, an independent transportation consultant, for their review of earlier drafts. 

Executive Summary

Shanghai is experiencing rapid economic growth. Affluence is motivating dramatic and far-ranging changes in urban structure, transportation, and energy use. This report examines two transportation trajectories that Shanghai might follow and how they would affect greenhouse gas (GHG) emissions. Shanghai’s metropolitan population of over 13 million people continues to grow relatively slowly, but its economy is growing rapidly. The average annual per capita income is $4,000, three times higher than the rest of China, and the Shanghai economy is expected to grow at more than 7 percent per year through 2020.

Massive new transport system investments planned for the next two decades are aimed at lowering Shanghai’s extremely high population density, supporting economic growth, and enhancing the quality of life. The list of new investments is impressive: expansion of the new airport, construction of a deep-water harbor, three new bridges and tunnel river crossings, completion of a 200-kilometer modern rapid transit rail system, expansion of suburban highways, and construction of 2,000 kilometers of new and upgraded urban roads. These investments will improve the city's transportation system, but are costly and threaten greater energy use and air pollution.

A central issue in Shanghai’s development is the role of personal vehicles, especially cars. The city currently devotes little land to roads and has only 650,000 cars and trucks — very few of which are privately owned — placing vehicle ownership levels well below virtually all cities of similar income. Even with this small number of vehicles, Shanghai already suffers from serious transport-induced air pollution and traffic congestion.

Shanghai city planners project a quadrupling of cars and trucks in the city by 2020. This projected increase is premised principally on two factors. First is rapid income growth, which will make car ownership possible for a much larger segment of the population. And second is vehicle prices, which are likely to plummet due to China’s imminent accession to the World Trade Organization (WTO). Lower prices will result from increased competition, compulsory reductions in vehicle tariffs, and easier access to consumer credit.

These projected increases in vehicle use are not certain.  Even apart from the WTO membership, vehicle ownership and use--and GHG emissions--will be strongly influenced by three interrelated policy debates: industrial policy toward the automotive industry, air quality policy, and transportation and urban growth policy.

The city's decision about vehicle use will be critical in shaping Taiwan's future.
This report addresses the forces about to transform the transportation system of Shanghai, and examines policies and strategies that that direct it toward greater economic, social and environmental sustainability.

The two transportation scenarios draw upon extensive interviews with decision-makers and experts in Shanghai and Beijing.  One scenario is premised on rapid motorization, the other on dramatic interventions to restrain car use and energy consumption, resulting in lower GHG emissions.  Neither is the "business-as-usual" scenario, since this characterization is meaningless in a time of massive investments and policy shifts.  Instead, these scenarios are meant to estimate likely upper and lower bounds of greenhouse gas emissions from Shanghai transport in 2020, taking as given the projected strong economic growth.  If the economy grows more slowly, emissions will likely be lower than the scenarios indicate.

The rapid motorization scenario is based on the projected quadrupling of cars by 2020, coupled with a substantial increase in population.  It results in a seven-fold increase in GHG emissions.  The restrained scenario results in a four fold increase in GHG emissions.  In this restrained scenario, almost all emissions growth is due to increase in travel, not increases in energy intensity or GHG intensity of the travel.  Emissions per passenger-kilometer increase only about 10 percent the restrained scenario compared to a doubling in the rapid motorization scenario.

Caution is urged in generalizing the findings of this report to other cities in developing nations.  Shanghai is not a typical Asian city, given its surging economy and its world-class planning capabilities.  However, the conditions for alternative transportation options are more propitious here than perhaps any other megacity in the world.  If the city is effective at restraining growth in vehicle use (and GHG emissions), Shanghai may serve as a model for other cities in the developing world. 

Daniel Sperling
Deborah Salon
Hongchang Zhou
Mark Delucchi
0

Transportation in Developing Countries: Greenhouse Gas Scenarios for Delhi, India

Download Report

Transportation in Developing Countries: Greenhouse Gas Scenarios for Delhi, India

Prepared for the Pew Center on Global Climate Change
May 2001

By:
Ranjan Bose and K.S. Nesamani, Tata Energy Research Institute (TERI)
Geetam Tiwari, Indian Institute of Technology-Delhi
Daniel Sperling, Mark Delucchi, and Lorien Redmond, Institute of Transportation Studies, University of California, Davis
Lee Schipper, International Energy Agency

Press Release

Download Entire Report (pdf)

Foreword

Eileen Claussen, President, Pew Center on Global Climate Change

Greenhouse gas emissions in developing countries are increasing most rapidly in the transportation sector. Even people with low incomes are meeting their need for mobility, and projected income growth over the next two decades suggests that many more will acquire personal modes of transportation. How this will affect the earth's climate is a great concern.

In Delhi, India, transportation sector greenhouse gas emissions are expected to soar. There are policy and technology choices that could significantly lower the emissions growth rate while increasing mobility, improving air quality, reducing traffic congestion, and lowering transport and energy costs. To realize these benefits, vision, leadership, and political will must be brought to bear. Delhi has high vehicle ownership rates for the city's income level, increasing congestion, poor air quality, poor safety conditions, and insufficient coordination among the responsible government institutions. Travelers in Delhi desire transportation services, reflected by the increasing numbers of inexpensive but highly polluting scooters and motorcycles.

This report creates two scenarios of greenhouse gas emissions from Delhi's transportation sector in 2020. It finds:

  • Greenhouse gas emissions quadruple in the high-GHG, or business-as-usual, scenario; but only double in the low scenario.
  • Transportation policies are readily available that will not only slow emissions growth, but also significantly improve local environmental, economic, and social conditions.
  • Improved technology would maximize the efficiency of automobiles, buses, and other modes of transportation and could play a key role in reducing emission increases.
  • Keeping many travel mode options available - including minicars and new efficient scooters and motorcycles - will help individuals at various income levels meet their mobility needs.
  • The time to act is now. The issues facing Delhi represent opportunities for improvement, but the longer authorities wait to address transportation inefficiencies, the more difficult and expensive it will be to produce a positive outcome.

Transportation in Developing Countries: Greenhouse Gas Scenarios for Delhi, India is the first report in a five-part series examining transportation sector greenhouse gas emissions in developing countries. The report findings are based on (1) a regression model developed by TERI to forecast future increases in vehicle ownership and travel by different modes and (2) a Lifecycle Energy Use and Emissions Model developed by the Institute of Transportation Studies at U.C.-Davis which estimates greenhouse gas emissions from the transportation sector.

The Pew Center gratefully acknowledges Anita Ahuja of Conserve, Ralph Gakenheimer of MIT, and Michael Walsh, an independent transportation consultant, for their review of earlier drafts. 

Executive Summary

Delhi, India is a rapidly expanding megacity. Like many other cities its size, Delhi faces urban gridlock and dangerous levels of air pollution. Vehicle ownership is still a fraction of that in industrialized countries, but remarkably high considering the population's relatively low income. Worldwide, energy use is increasing faster in the transport sector than in any other sector, and fastest of all in developing countries. From 1980 to 1997, transportation energy use and associated greenhouse gas (GHG) emissions increased over 5 percent per year in Asia (excluding the former Soviet Union) and 2.6 percent in Latin America, compared to one percent growth in greenhouse gases from all sectors worldwide.

Delhi faces the same transportation, economic, and environmental challenges of other megacities. Population, motor vehicles, pollution, and traffic congestion are all increasing. Air pollution levels greatly exceed national and World Health Organization health-based standards, and transportation is by far the largest source of pollution. In the past 30 years, Delhi's population more than tripled and the number of vehicles increased almost fifteenfold.

By 2000, Delhi had about 2.6 million motor vehicles - 200 for every 1,000 inhabitants, a rate far higher than most cities with similar incomes. Most of these vehicles are small, inexpensive motorcycles and scooters, rather than automobiles. This proliferation of vehicles in a relatively poor city indicates the strong desire for personal transport - a phenomenon observed virtually everywhere. Delhi is an example of how that desire can now be met with relatively low incomes.

Delhi is expected to continue growing at a rapid rate. Its population is expected to surpass 22 million by 2020. Motor vehicles, including cars, trucks, and motorized two- and three-wheelers, are expected to grow at an even faster rate. The domestic auto industry is predicting car sale increases of 10 percent per year. With an extensive network of roads and increasing income, there is every reason to expect vehicle sales and use to continue on a sharp, upward trajectory. 

0

Developing Countries & Global Climate Change : Electric Power Options in Argentina

Developing Countries & Global Climate Change : Electric Power Options in Argentina

Prepared for the Pew Center on Global Climate Change
May 2000

By:
Daniel Bouille, Institute for Energy Economics, Bariloche Foundation
Hilda Dubrovsky, Institute for Energy Economics, Bariloche Foundation
William Chandler, Battelle, Advanced International Studies Unit
Jeffery Logan, Battelle, Advanced International Studies Unit
Fernando Groisman, Institute for Energy Economics, Bariloche Foundation

Press Release

Download Entire Report (pdf)

Download Report (ZIP file)

Foreword

Eileen Claussen, President, Pew Center on Global Climate Change

The Republic of Argentina is positioning itself at the forefront of the climate change debate among non-Annex I countries. It initiated market reforms in the early 1990s that made the economy more efficient while providing mixed, but on balance, positive, environmental results. In 1999, Argentina set a voluntary target to lower greenhouse gas emissions to between 2 and 10 percent below the projected baseline emissions for 2012. Additional policy choices that it makes to improve economic growth and lower emissions could serve as important examples for others facing similar challenges.

Argentina's electric power demand is expected to more than triple over the next 15 years, expanding by 6 percent a year. Emissions of greenhouse gases, however, do not have to increase at the same rate. The successful implementation of the market-based reforms and increased competition in power generation could continue to play an important role in the near future in lowering emissions from projected levels. This report describes the context for new investments in this sector and identifies principal trends under three alternative policy scenarios. The report finds that:

  • Under a business-as-usual scenario, electric power generating capacity, primarily from large natural gas turbines and combined-cycle plants, is expected to increase 170 percent, growing from 17 gigawatts in 1995 to 46 gigawatts in 2015, at a cost of $26 billion. Carbon dioxide emissions are expected to nearly triple, growing from 4.8 million tons in 1995 to 14 million tons in 2015.
  • Natural gas combined-cycle plants have become the most competitive alternative over hydro and nuclear power, and are currently the main choice of private sector power developers in Argentina. These plants produce less than half the greenhouse gas emissions of similar coal-fired plants, and have essentially no emissions of sulfur dioxide and particulates. If low-cost natural gas resources become restricted due to shortages, however, investments would flow to nuclear and coal-fired power plants. This outcome could raise total costs to nearly $45 billion, although greenhouse gas emissions would remain essentially unchanged due to the offsetting characteristics of nuclear and coal-fired plants.
  • Adopting policies that favor renewable energy sources and nuclear power cost $32 billion by 2015 — about 23 percent more than the baseline — and would decrease carbon dioxide emissions from 14 million tons in the baseline to 11 million tons in 2015.
  • Increasing energy efficiency by end-users and demand-side management would reduce total costs by $6.3 billion and carbon dioxide, sulfur dioxide and nitrogen oxide emissions would all decline 20 percent compared to the baseline.

Developing Countries and Global Climate Change: Electric Power Options in Argentina is the last of a series commissioned by the Center for Climate and Energy Solutions to examine the electric power sector in developing countries, including four other case studies in Brazil, China, India, and Korea.

The Pew Center was established in 1998 by the Pew Charitable Trusts to bring a new cooperative approach and critical scientific, economic, and technological expertise to the global climate change debate. We believe that climate change is serious business, and only through a better understanding of circumstances in individual countries can we hope to arrive at a serious response.   

Executive Summary

Argentina boasts a distinctly market-oriented electricity generating system. Power sector reforms have progressed further than in most nations, including the United States, and hold important lessons for climate policy. Competition in Argentina has favored natural gas over hydropower and nuclear power, thus increasing emissions at the margin, but has also virtually eliminated coal from the market despite its abundance. While competition has lowered the price of electricity, and thereby increased demand, it has done so by reducing inefficiency that in turn reduced carbon emissions. Privatization and competition in the energy sectors of Argentina and several other South American countries is influencing power reform across the continent.

There are numerous trends driving growth in energy demand. The electric power sector consumes about 22 percent of Argentina's total energy supply. Today, overall energy demand growth is driven by transportation energy use, which increased by half since 1990. The residential sector grew by more than one-quarter over the same period. Abundant natural gas provides one-third of total energy use and continues to increase market share. Transportation and agriculture still rely on petroleum, but industry, commercial buildings, and residences have increasingly switched to direct use of natural gas. Argentina also exports petroleum and natural gas, currently about one-eighth of total production. The country has a relatively strong energy conservation and efficiency program focusing on cogeneration of heat and power, energy appliance labeling, and efficient lighting.

Argentina is emerging as a leader in environmental issues. In October 1999, Argentina announced a voluntary effort to restrict greenhouse gas emissions within a range of 2 to 10 percent below the projected baseline level during 2008-2012. Argentina became the first developing country under the United Nations Framework Convention on Climate Change to establish a voluntary target. The impact of this action on other developing countries is still not clear, but it could catalyze some of the relatively small emitters to take on similar voluntary targets.

While Argentinian power demand is expected to continue to grow rapidly at over 6 percent each year, growth will not necessarily mean a corresponding increase in emissions. Carbon emissions in particular can be offset by improving energy conversion efficiencies, promoting carbon-friendly renewable energy sources, and introducing policies such as the Clean Development Mechanism (CDM) or domestic actions to change fuel-choice decisions. This study explores these and other issues in four scenarios including a baseline of continuing policies and trends, an emissions mitigation case, a natural gas shortage scenario, and a scenario of end-use efficiency improvements.

The scenarios provided the following results:

Baseline Scenario. This scenario, which assesses power supply and demand based on current trends and fuel availability, projects installed power generating capacity to grow from about 17 gigawatts1 in 1995 to 46 gigawatts in 2015, an increase of 170 percent. The share of power provided by hydroelectric resources will fall from half of all generation in 1995 to about one-quarter, while nuclear power will drop from 10 percent of supply to only 3 percent in 2015. Gas-fired plants provided about 46 percent of power in 1995, a share that will grow to 72 percent over the next decade-and-a-half. Total cost in the baseline scenario from 1995 to 2015, including discounted capital, operations and maintenance, and fuel components, is estimated to be $26 billion. Carbon dioxide emissions from the power sector grow from 4.8 million tons of carbon in 1995 to an estimated 14 million tons in 2015, almost tripling.

Emissions Mitigation Scenario. This scenario tests the impact of policies to reduce the capital cost of power supply in order to favor non-carbon energy sources such as hydropower and wind. The reduction in capital costs is simulated by lowering the discount rate from 12 percent in the base case to 5 percent, and would require an outright social or environmental subsidy. This approach might simulate the use of domestic subsidies and soft loans or investments from the CDM. In this scenario, hydropower's share continues to fall but only to 39 percent, while nuclear's share drops to 4 percent. Power supply grows 7 percent more than in the baseline, thus requiring a total of almost 49 gigawatts of capacity in 2015. The value of the "subsidy" would amount to $6 billion over the 20-year period as total costs increase by 23 percent to $32 billion. Carbon dioxide emissions are around 11 million tons, or one-fifth less than baseline levels.

Natural Gas Shortage Scenario. This scenario assumes that low-cost natural gas resources are restricted — compared to the baseline scenario — for use in the power sector starting in 2005. Methodologically, the scenario applies the 12 percent discount rate used in the baseline but severely constrains gas supply to reflect the assumed resource depletion. Consequently, the least-cost model simulation predicts investment flowing to nuclear and coal-fired power stations. Total power capacity reaches 48 gigawatts, 4 percent above the baseline, although actual power generation remains the same. Nuclear power's share in generation rises dramatically to over 15 gigawatts by 2015. The scenario also applies environmental externalities to coal use, and this accounts for the marked increase in nuclear power. Power demand would exceed 181 terawatt-hours, compared to roughly 55 terawatt-hours today. Total costs would rise to nearly $45 billion, over 70 percent higher than the baseline. Carbon emissions would decline by 2 percent, but sulfur dioxide and particulate emissions would increase dramatically due to the increased use of coal-burning power plants. The likelihood of a natural gas shortage this severe is remote so the scenario results should be viewed as an upper-end outcome.

Efficiency Scenario. This scenario tests the effect of demand-side energy-efficiency policies, including strengthening standards for appliances and buildings, increasing competition in energy-using equipment by liberalizing trade, and providing informational or financial assistance to industrial consumers. Efficiency is assumed to reduce energy use in the buildings sector by 9 percent and by 7 percent in the industrial sector by 2015 compared to the baseline. Industrial cogeneration plays a significant role in this scenario. Total power costs are $6.3 billion lower than in the baseline and more than 50 percent below the natural gas shortage scenario. Carbon dioxide, sulfur dioxide, particulate, and nitrogen oxide emissions would all decline by approximately 20 percent compared to the baseline.

Several of the above scenarios raise questions about implementation costs. While the CDM might be one option in the mitigation scenario, this study makes no claim to describe how such a mechanism could be implemented to achieve the major shift in private discount rates. The efficiency scenario, similarly, depends on policies with uncertain effectiveness and does not indicate the level of effort that would be required. Achieving the potential revealed in these scenarios will depend on major new policy initiatives and on policy research to describe an effective set of policies that decision-makers can adopt.

The impact of increased use of market forces on the environment and specifically on greenhouse gas emissions in Argentina has been mixed but, on balance, positive. While hydropower and nuclear are seriously disadvantaged by market economics, gas is highly favored over coal. Because the environmental and social considerations of hydropower, nuclear, and coal are substantial, it cannot be said that the market produces an unfavorable environmental result. More to the point, the market in Argentina has provided a prudent path for energy development and environmental protection, one that sensible public policy can build on to further protect Argentina's environment and the global climate.

About the Authors

Daniel Bouille
Daniel Bouille is Senior Researcher at the Institute for Energy Economics/Bariloche Foundation in Buenos Aires, Argentina. An economist by training, his academic background includes post-graduate studies in Energy Economics at the University of Cologne in Germany.

His professional background presently focuses on research and technical assistance related to climate change issues. Professor Bouille was National Coordinator of the Argentine Report on Greenhouse Gas Mitigation in the Energy Sector. He has served as Coordinator of numerous projects including, "Study on Flexibility Mechanisms within the Context of the United Nations Framework Convention on Climate Change and the Kyoto Protocol;" "Study of the Andean Pact: the Benefits of the Integration on Greenhouse Gas Emissions;" Technical Assistance to the First Mitigation Study for El Salvador; and Energy Study to fix the Argentine Voluntary Commitment.

Professor Bouille is also a member of the expert roster of the GEF, and Lead Author of the IPCC Working Group III Third Report.


HILDA SUSANA DUBROVSKY

CURRICULUM VITAE

NAME AND SURNAME: Hilda Susana Dubrovsky
CITIZENSHIP: Argentine
BIRTH DATE: September 6th, 1953
PRESENT POSITION: Instituto de Economía Energética Academic Researcher

MAJOR FIELDS OF STUDY:

Civil Engineer directed to hydraulic vocational guidance.
Researcher, Postgraduate in Economic and Energy Planning.

PROFESSIONAL AND RESEARCH BACKGROUND:

Experience obtained through different research-studies and works dealing with Economics and Energy Planning, requested by national and international agencies such as: PNUD, FAO, CEE (DG XVII), IDRC (Canada), IDB, OLADE, The World Bank, CIER (Commission of Regional Electricity Integration) and The Andean Promoting Corporation- CAF. Other institutions as the National Secretariat for Energy (Argentina) and different national and provincial public or private bodies: INVAP, CNEA, also with various universities and electricity companies.

SUBJECTS:

Electricity Planning, energy prices and tariffs, energy and agriculture-husbandry production techniques; projection methodology covering energetic requirements; integral energy planning at national level; energy integration; strategies dealing with national use of the energy, environment impacts of the energy systems.

Author and collaborating member in numerous research studies, covering the above mentioned areas.


WILLIAM CHANDLER

William Chandler is currently Senior Staff Scientist and Director of Advanced International Studies at Battelle Memorial Institute's Pacific Northwest National Laboratory in Washington, D.C. He is a member of the international energy panel of the U.S. President's Council of Advisors on Science and Technology, and an adjunct professor at Johns Hopkins University.

Mr. Chandler has authored or co-authored ten books, and has often published in both technical and popular journals, including Climatic Change and Scientific American. He occasionally appears on national radio and television, most recently in a Peter Jennings ABC special on climate change.

His international work has included institution building, policy development, and project finance. He led the creation of independent, not-for profit energy efficiency centers in six nations, including Russia and China. Chandler received the 1992 Champion of Energy-Efficiency Award from the American Council for an Energy Efficient Economy for his work. He has also led case studies of energy and climate in most of the transition economies and is lead author for the Intergovernmental Panel on Climate Change, currently focusing on technology transfer.

Mr. Chandler manages the U.S.-Ukrainian collaborative program on energy-efficiency investment under the Gore-Kuchma Commission and is a member of the National Committee on U.S.-China Relations. He holds a B.S. from the University of Tennessee, and an MPA from Harvard University.


JEFFREY LOGAN

Jeffrey Logan is a Research Scientist in the Advanced International Studies Unit of the Pacific Northwest National Laboratory in Washington, D.C. His work focuses primarily on the environmental and economic impacts of energy system decisions, with a heavy geographic focus on China.

He has published extensively on China's electric power sector, natural gas industry, energy conservation efforts, and renewable energy potential. He led a 1998 study entitled "China's Electric Power Options: An Analysis of Economic and Environmental Costs, " which received wide attention. He has also advocated greater natural gas use in China as a substitute for coal and published related articles in the Oil and Gas Journal and the China Business Review.

Mr. Logan began his career at General Electric modeling satellite orbits. He later joined the Peace Corps and taught applied science in rural Nepal. A growing interest in the rapid development of Asian economies and their associated environmental and social dislocations then took him to China where he worked with the United Nations. He has five years of field experience in Asia and speaks Chinese and Nepali.

Logan has a B.S. degree in Aerospace Engineering from the Pennsylvania State University. He also holds a joint Masters degree in Environmental Science and Public Administration from the School of Public and Environmental Affairs at Indiana University. He has also worked at the East-West Center in Hawaii researching the dynamics of Chinese energy and economic activity.


FERNANDO GROISMAN

CURRICULUM VITAE

NAME AND SURNAME: Fernando Groisman
CITIZENSHIP: Argentine
BIRTH DATE: June 30th, 1921
PRESENT POSITION: Instituto de Economía Energética Senior Researcher

MAJOR FIELDS OF STUDY:

Mechanical-Electrician Engineer, Senior. Expertise in Economics, Energy Policy and Planning. Methodologies and Applications directed to Energy Planning connected to the requirements, supply and environment impacts.

PROFESSIONAL AND RESEARCH BACKGROUND:

Experience and training in: Integral Energy Studies worked in different Argentine provinces and National regions, as well as in foreign countries. Studies covering the diagnosis, energy demand and supply scenarios, on medium and long term; environment impacts and mitigation sceneries related to environmental pollution. Studies dealing with the rational use of energy. Energy and environment policies patterns; assessment and supply by means of non-conventional energy sources. Various study-works referred to the different effects of technology. Advisor on subjects referred to Energy Legislation.

Author and collaborating member in numerous research study-works in the above mentioned fields.   

 

Daniel Bouille
Fernando Groisman
Hilda Dubrovsky
Jeffrey Logan
William Chandler
0

Developing Countries & Global Climate Change: Electric Power Options in Brazil

Developing Countries & Global Climate Change: Electric Power Options in Brazil

Prepared for the Pew Center on Global Climate Change
May 2000

By:
Roberto Schaeffer, Federal University of Río de Janeiro
Jeffery Logan, Battelle, Advanced International Studies Unit
Alexandre Salem Szklo, Federal University of Río de Janeiro
William Chandler, Battelle, Advanced International Studies Unit
João Carlos de Souza Marques, Federal University of Río de Janeiro

Press Release

Download Entire Report (pdf)

Foreword

Eileen Claussen, President, Pew Center on Global Climate Change

Brazil is the fifth largest country in the world and its economy is roughly equal to that of all other South American countries combined. Yet, its greenhouse gas emissions are less than one-third of the continent's total due to the dominant role of hydropower. Total energy consumption is less than one-tenth the level in the United States and per capita carbon emissions are just 0.5 tons, compared to approximately 1.0 ton in Argentina and Mexico.

Brazil is already considered an environmental leader among developing countries and plays a significant role in the international climate change debate. Whether it is able to stay on this path will depend in part on its energy choices over the next fifteen years. This report describes the context for new power sector investments and presents three alternative policy scenarios for 2015. The report finds that:

  • Construction of new hydroelectric plants is increasingly expensive and controversial due to social and environmental impacts. As a result, many new investors may favor natural gas-fired combined-cycle plants. Under a business-as-usual trajectory, carbon dioxide emissions will grow from 3.4 million tons in 1995 to 14.5 million tons in 2015, mainly due to this shift to natural gas.
  • Further tightening of local environmental regulations and adoption of renewable energy policies could reduce carbon dioxide and sulfur dioxide emissions by 82 percent and 75 percent, respectively, by 2015 compared to the baseline scenario, at little additional cost.
  • Creating a carbon-free power sector would require an additional $25 billion in cumulative costs by 2015 — about 15 percent more than the business-as-usual scenario — and would expand the use of renewable energy resources.
  • Wind power potential could be harnessed — increasing from zero to 2 percent of total installed capacity by 2015 — depending on the extent of government subsidies.

Developing Countries and Global Climate Change: Electric Power Options in Brazil is the fifth of a series commissioned by the Center for Climate and Energy Solutions to examine the electric power sector in developing countries, including four other case studies of Korea, India, China, and Argentina.

The Pew Center was established in 1998 by the Pew Charitable Trusts to bring a new cooperative approach and critical scientific, economic, and technological expertise to the global climate change debate. We believe that climate change is serious business, and only through a better understanding of circumstances in individual countries can we hope to arrive at a serious response.   

Executive Summary

Brazil generates over 90 percent of its electricity by capturing the energy in falling water. Per capita carbon emissions in Brazil are less than half the world average, largely because of the country's heavy reliance on hydropower, which produces few greenhouse gas emissions. Many of the country's new power plants, however, will likely use natural gas since many investors view hydroelectric plants as increasingly costly, controversial, and risky.

This study analyzes the options for meeting power demand in the Brazilian power sector through 2015. Meeting this demand at least-cost — including the estimated costs of environmental impacts — is a topic of great concern for decision-makers in government and industry. The electric power choices Brazil makes may influence the global response to climate change out of proportion to its emissions, as Brazil is considered an environmental leader among developing countries.

Current reforms in the power sector have been designed mainly to cut costs by introducing competition in electricity generation. Other objectives include reducing government investment in power plant construction and the risk of electricity shortages. These reforms have catalyzed institutional changes in Brazil: privatization, elimination of tariff equalization across regions, and the introduction of supply contracts between power generation and distribution utilities.

The authors begin with a brief review of Brazil's economic and energy situation, then turn to a detailed account of the nation's electric power sector. The report presents results of regional electric power demand forecasts through 2015 and assessments of available energy resources and technologies. An analysis using a linear programming model determines the least-costly combinations of power supply technologies that meet projected power demand.

Three policy cases were devised to test economic and environmental policy measures against a baseline: advanced technologies, local environmental control, and carbon elimination. Least-cost modeling simulated these scenarios through changes in emissions fees and caps, costs for advanced technologies, demand-side efficiency, and clean energy supplies.

The authors conclude that, without alternative policies, new additions to Brazil's electric power sector will shift rapidly from hydroelectricity to combined-cycle natural gas plants. Greenhouse gas emissions will thus increase rapidly, although the absolute quantities will remain relatively low. While combined-cycle natural gas plants generate power with 60 percent less carbon dioxide emissions than coal units, greenhouse gas emissions will still rise rapidly as the gas plants replace hydropower facilities that are nearly carbon-free. Specifically, the scenarios produced the following results:

Baseline Scenario. This scenario assumes that institutional reform such as privatization and increased competition among generators is successfully implemented over the coming decade. The installed capacity grows from 56 gigawatts in 1995 to 94 gigawatts in 2015, an increase of 68 percent. Natural gas plants increase from essentially zero to 11 percent of installed capacity over the period of analysis. Energy efficiency and cogeneration play important roles in limiting an even greater reliance on fossil fuel power generation. The total cost of meeting demand is $183 billion,1 which includes capital, fuel, and operation and maintenance costs. Carbon dioxide emissions rise more than four-fold from 3.4 million tons of carbon in 1995 to 14.5 million tons in 2015. However, the intensity of CO2 emissions in Brazil remains low, even in 2015, as hydropower still accounts for 74 percent of total generation. Sulfur dioxide and particulate emissions grow proportionately with power generation, while nitrogen oxides increase five-fold to reflect the greater use of natural gas in power generation turbines.

Advanced Technology Scenario. The advanced technology scenario simulates capital cost reductions for power plant equipment due to technological progress driven by government incentives. Environmental costs are also at least partially accounted for in the least-cost analysis by including some of the external costs of emissions, hydropower construction, and nuclear decommissioning that are normally ignored. Wind power increases from zero to almost 2 percent of total installed capacity by 2015 due to the environmental fees imposed on fossil-fuel use. The total cost of this scenario is $181 billion, 1.6 percent less than the baseline, mainly due to the cheaper costs of building and operating combined-cycle power plants in the later years. This figure does not include the research, development, and deployment costs needed to improve technologies. Carbon dioxide emissions drop slightly from the baseline, reaching 13.3 million tons of carbon in 2015. Sulfur dioxide emissions decline by approximately 50 percent due to the elimination of diesel generators after 2005.

Local Environmental Control Scenario. In this scenario, renewable energy policies and the use of higher environmental externalities influence the technologies employed. The environmental costs of pollution are assessed at a higher value than in the technology scenario, and cost reductions for cleaner, advanced technologies are also assumed. Hydropower plays a larger role in this scenario, rising to over 88 percent of total installed capacity. The environmental and social impacts of expanding hydroelectric power production this much are difficult to estimate, but could be significant. Biomass capacity rises from 2 percent in the 2015 baseline case to 5 percent. The cost of this scenario is $179 billion. Carbon dioxide emissions drop from 3.4 million tons of carbon in 1995 to 2.6 million tons in 2015. Sulfur dioxide emissions decline substantially, while particulate emissions increase due the growth in biomass combustion for power generation.

Carbon Elimination Scenario. In the carbon elimination scenario, Brazil installs electric power generation technologies that produce no net carbon dioxide emissions and only minor impacts on watersheds and landscapes. Installed capacity in 2015 reaches 97 gigawatts, and hydropower continues to account for over 80 percent of installed capacity. Renewable energies account for 97 percent of power generation in 2015, with biomass accounting for over 16 percent. The remaining 3 percent is generated from existing nuclear power plants. The total cost of the expansion is $208 billion, 14 percent above the baseline scenario. Carbon emissions cease and sulfur dioxide emissions drop, but particulate emissions rise five-fold due to the heavy reliance on biomass.

Conclusions

Brazilian power supply will continue to rise at appreciable rates over the next two decades regardless of the country's current economic difficulties. Reforms under way in the power sector, however, will greatly influence how power demand is met and the emissions that result. Hydropower will continue to play a dominant role through 2015, although its relative share will most likely decrease.

Carbon emissions more than quadruple in the baseline scenario to 14.5 million tons, but remain extremely low in absolute terms. (For comparison, the U.S. power industry released approximately 550 million tons of carbon dioxide in 1998.2) This output is equivalent to the emissions from 10 large coal-fired power plants. Biomass and wind power might play a larger role in Brazil's power future if the government focuses on developing advanced technologies and accounts for at least some of the costs to the environment. Coal-based technologies are not competitive with other forms of power generation, allowing Brazil to largely avoid the tradeoff between improving the quality of the local environment and reducing global greenhouse gas emissions.

In the local environmental control and carbon elimination scenarios, there is a strong interdependence between electricity generation based on sugar cane bagasse and ethyl alcohol production for automotive use. By accounting for the environmental impacts of local pollutants or restricting power generation options to those with no carbon dioxide emissions, sugar cane bagasse becomes feasible, making it the power generation technological option that is most widely used in both scenarios after hydropower. This indicates that Brazil has the potential to service the electricity market without carbon emissions if the market or the international community can support the 14 percent higher costs.

In all four scenarios, energy efficiency and cogeneration play an important role in the least-cost power solution. Saving electricity through increased efficiency offsets the need for new supply and has enormous potential in Brazil's industrial sector. Efficiency also reduces the environmental burden associated with electricity production and transmission (most likely via natural gas combined-cycle plants) without compromising the quality of services that end users demand.

Carbon dioxide emissions from Brazil's power sector will remain low in absolute terms over the next two decades. Brazil appears able to play a unique role within the context of the UN Framework Convention on Climate Change by fostering economic growth that does not sacrifice local or global environmental quality. Achieving cleaner development would serve as a powerful example for other developing countries. 

Alexandre Salem Szklo
Jeffrey Logan
João Carlos de Souza Marques
Roberto Schaeffer
William Chandler
0

Developing Countries & Global Climate Change: Electric Power Options in China

Developing Countries & Global Climate Change: Electric Power Options in China

Prepared for the Pew Center on Global Climate Change
May 2000

By:
Zhou Dadi, Beijing Energy Efficiency Center
Guo Yuan, China Energy Research Institute
Shi Yingyi, Beijing Energy Efficiency Center
William Chandler, Battelle, Advanced International Studies Unit
Jeffrey Logan, Battelle, Advanced International Studies Unit

Press Release

Download Entire Report (pdf)

Download Report (ZIP file)

Foreword

Eileen Claussen, President, Pew Center on Global Climate Change

With annual releases of over 918 million metric tons of carbon dioxide into the atmosphere, the People's Republic of China takes center stage among developing countries in the climate change debate. If China could achieve significant emission reductions from the business-as-usual scenario, particularly within the electric power sector, it could be considered a major advance in addressing climate change. Yet the task is daunting. Decision-makers must have a better understanding of the paths that are possible for electric power investment in China, and the impacts of these investments.

This report is designed to improve that understanding. It describes the context for new power sector investments and presents five alternative policy scenarios through 2015. The report presents concrete policy strategies that could enable China to meet growing electricity demand while continuing economic growth, and reducing sulfur dioxide and greenhouse gas emissions.

The principal drivers of the technology choices for the next fifteen years are:

  • Growing awareness that under a business-as-usual path, carbon emissions from thermal plants will increase from 189 million tons in 1995 to 491 million in 2015, and sulfur dioxide emissions from 8.5 million to 21 million due to the heavy reliance on coal-fired power generation.
  • Increasing demand-side energy efficiency by 10 percent from business-as-usual projections could reduce carbon dioxide and sulfur dioxide emissions by 19 and 13 percent, respectively, in 2015, while lowering cost to 12 percent below the baseline.
  • Expanding the availability of low-cost natural gas through market reforms could reduce emissions of carbon dioxide and sulfur dioxide in the power sector by 14 and 35 percent, respectively, and increase cost by only 4 percent relative to the baseline.
  • Accelerating the penetration of cleaner coal technologies could help China reduce sulfur dioxide and particulate emissions, but the associated impact on carbon emissions would be minimal and would increase costs by 6 percent relative to the baseline.

Developing Countries and Global Climate Change: Electric Power Options in China is the fourth of a series commissioned by the Center for Climate and Energy Solutions to examine the electric power sector in developing countries, including four other case studies of Korea, India, Brazil, and Argentina.

Executive Summary

China plays a leading role among developing nations in the field of energy and climate policy. The nation now ranks second in the world in energy consumption and greenhouse gas emissions. The electric power sector alone could consume as much as one billion tons of coal in 2015, and emit 300 million additional tons of carbon per year. Chinese decisions affecting energy development and emissions mitigation will significantly impact world climate. However, China currently has no formal plans to reduce its greenhouse gas emissions for their own sake.

China has changed dramatically since the country adopted economic reforms in the late 1970s. The nation's economy has grown and living standards have improved for over two decades. Although income per capita remains far less than in industrialized countries, its gross domestic product is large enough to affect the global economy. As the country's economy improves, China's influence will continue to grow.

China has fueled this robust growth with plentiful supplies of domestic coal. In 1997, the country consumed nearly 1.3 billion tons of coal, (accounting for three-quarters of all commercial energy demand), the highest in the world. Heavy reliance on coal has also caused severe environmental problems, including acid rain in southern China, deadly particulate levels in most cities, and increasing concentrations of greenhouse gases in the global atmosphere. Yet, for two decades energy use has grown only half as fast as the economy. According to official statistics, China has recently been far more successful than the United States in improving energy efficiency.

The power sector currently accounts for more than one-third of China's annual coal consumption. Coal-fired thermal power plants generate over 75 percent of the nation's electric power and are among the largest sources of air pollution in China. Continued growth in economic output and living standards implies that electric power demand will grow rapidly in the foreseeable future. How to meet demand at least cost — including local environmental impacts — is a topic of great concern for decision-makers in government and the power industry.

This analysis, which explores China's electric power options, has three primary goals:

  • Assess the current and future state of the power sector
  • Determine the least-cost combination of technologies to meet projected power demand through 2015 under various scenarios
  • Evaluate policies that could minimize both economic and local environmental costs.

This report begins with a brief review of China's economic and energy situation, then turns to a detailed account of the nation's electric power sector. The paper assesses available energy resources and generation technologies, and results of regional electric power demand forecasts through 2015. Results are presented from an analysis using a linear programming model to determine least-cost combinations of power supply technologies that meet projected power demand in 2015. The authors constructed a baseline and five policy cases to test economic and environmental policy measures, including sulfur dioxide and carbon dioxide controls, natural gas reform, clean coal investment mechanisms, and increased energy efficiency. The model simulated these scenarios by applying emissions caps, fees, cost reductions, increased fuel availability, improved plant performance, or lower demand estimates that then influence the selection of alternative technologies.

The authors conclude that without a strong environmental policy, China's electric power mix will become even more coal-dependent, with dramatic increases in emissions of sulfur dioxide, oxides of nitrogen, particulates, and carbon dioxide. These emissions would have serious effects on human health, property, and ecosystems.

When policy measures such as fuel availability, technical performance, and full-cost accounting are considered, however, the mix of electric power generation technologies — if not necessarily the fuels — changes significantly. The six scenarios produced the following results:

Baseline case. Power generating capacity and power consumption are expected to nearly triple by 2015 from their values in 1995, requiring some $449 billion in total costs. In the baseline scenario, coal then provides 85 percent of power, and coal use for power generation alone would reach 1 billion tons per year. Emissions of sulfur dioxide and carbon dioxide from the power sector would reach roughly 20 million tons and one-half billion tons per year, respectively. This scenario assumes that the current environmental policy remains the same, which appears increasingly unlikely.

Sulfur emissions control case. Annual sulfur dioxide emissions from the power sector could be cut to 12.7 million tons by 2015 — a 40 percent reduction from the baseline level — by imposing fees ranging from $360-$960 per ton of sulfur released. Total costs using the sulfur fees would rise by 4 percent. Sulfur control policies would reduce total coal use very little but greatly increase coal washing and flue gas desulfurization. These options cost less in China than alternatives such as nuclear power, hydropower, and advanced coal technologies that reduce sulfur emissions by a comparable amount. Achieving sulfur reductions would also require stricter regulatory enforcement. However, greenhouse gas emissions would change little as a result of stricter sulfur dioxide emissions control.

Carbon control case. This scenario tested the effect of reducing carbon emissions in the power sector by 10 percent, or 50 million tons per year, by 2015. The study simulates these reductions by assuming the construction of new, less carbon-intensive power plants; it does not consider alternatives to lower emissions in existing plants. A 10 percent reduction from the baseline would add an additional $20 billion to total costs by 2015, an increase of about 4 percent. Greater reliance on washed coal, hydropower, nuclear power, and fuel switching to natural gas would be the cheapest ways of reducing emissions. Moderate carbon taxes were also tested in this analysis, but they were not found to be particularly effective in encouraging fuel switching. Only very high taxes — over $75 per ton of carbon — produced significant emissions reductions.

Natural gas case. China currently uses very little natural gas for power generation. For change to occur, the government would need to establish new policies and reforms to increase the availability of natural gas. This scenario simulates the impact of policies to boost gas use in the power sector. Increased availability of low-cost natural gas in the power sector — combined with improved turbine efficiency and a $300 fee per ton of sulfur dioxide emissions — could cut carbon and sulfur dioxide emissions by about 14 and 35 percent, respectively, from the baseline. Natural gas power in this scenario is cheaper than coal-fired power only along the coastal regions (where coal is relatively expensive), but gas would need to be available for $3 per gigajoule. This value is lower than some forecasts, but still higher than gas prices in Europe and North America. The power sector would consume approximately 65 billion cubic meters of gas, accounting for roughly half of China's total gas demand in 2015.

Clean coal case. A set of scenarios tested the effect of reducing the cost of advanced coal technologies such as integrated gasification combined-cycle (IGCC) or pressurized fluidized bed combustion (PFBC) to help them capture additional market share relative to the baseline. A 40 percent reduction in capital costs for IGCC and PFBC, combined with a mid-level sulfur dioxide emissions fee of $300 per metric ton, would reduce carbon dioxide and sulfur dioxide emissions by 9 and 75 percent, respectively. However, approximately $140 billion in additional investment — perhaps through international cooperation on technology transfer and clean development — would be required to subsidize the cost of building these plants.

Efficiency scenario. This scenario tested the effect of reducing electric power use by 10 percent compared to the baseline. Such a reduction would lower carbon and sulfur dioxide emissions by 19 percent and 13 percent, respectively, in 2015, and save $55 billion in investment and fuel costs by postponing the need for 52 gigawatts of coal-fired generation capacity. The analysis did not consider the required policies or costs to lower power demand.

These scenarios revealed two important findings:

1. Policy options exist to reduce carbon emissions substantially in the Chinese power sector at relatively low incremental cost. Emissions reductions of more than 10 percent compared to projected baseline emissions in 2015 can be achieved for less than 5 percent of the total cost of power. Continued improvement in demand-side efficiency is a particularly attractive option to lower carbon emissions.

2. Not all of these reductions will be achieved for reasons that are in China's own interest, such as reducing sulfur dioxide emissions. Consequently, cooperation with other countries would be required to achieve more dramatic results.   

Guo Yuan
Jeffrey Logan
Shi Yingyi
William Chandler
Zhou Dadi
0

Developing Countries & Global Climate Change: Electric Power Options in Korea

Developing Countries & Global Climate Change: Electric Power Options in Korea

Prepared for the Pew Center on Global Climate Change
October 1999

By:
Jin-Gyu Oh, Korea Energy Economics Institute
Jeffrey Logan, Battelle, Advanced International Studies Unit
William Chandler, Battelle, Advanced International Studies Unit
Jinwoo Kim, Korea Energy Economics Institute
Sung Bong Jo, Korea Energy Economics Institute
Dong-Seok Roh, Korea Energy Economics Institute

Press Release

Download Entire Report (pdf)

 

Foreword

Eileen Claussen, Executive Director, Pew Center on Global Climate Change

The Republic of Korea straddles the line between developed and developing countries. Power demand is expanding rapidly - a "business-as-usual" path doubles consumption by 2015 - and the economy is driven largely by basic, energy-intensive industries. In addition, Korea imports over 90 percent of its fuel. Because of this, the energy choices Korea makes are complicated and may have ramifications for the global environment that outstrip the nation's size. They could leave Korea's greenhouse gas emissions virtually unchanged - or more than double them.

What will be the likely drivers of the technology choices for the next twenty years of new power generation?

  • Economic forces pulling Korea toward additional restructuring of the power sector and reform of industrial policy can reduce emissions of carbon dioxide by 9 percent relative to the baseline, with slightly lower costs per unit of electricity generated. Increasing the supply of natural gas and reducing import tariffs on that fuel have similar impacts.
  • Economic concerns also might lead to more widespread adoption of cost-effective energy efficiency measures and, by reducing demand for power by 15 percent, could also reduce carbon and sulphur dioxide emissions by almost 25 percent.
  • Further tightening of local environmental requirements might shift technology choices toward natural gas and nuclear and achieve reductions in the emissions of sulphur dioxide (59 percent) and carbon dioxide (28 percent), with only a small increase in costs. Developing Countries and Global Climate Change: Electric Power Options in Korea is the second in a series examining the electric power sectors in developing countries, and will be followed by four more case studies of India, China, Brazil, and Argentina. The report's findings are based on a lifecycle cost analysis of several possible alternatives to current projections for expanding the power system.

The Center was established in 1998 by the Pew Charitable Trusts to bring a new cooperative approach and critical scientific, economic, and technological expertise to the global climate change debate. The Pew Center believes that climate change is serious business and a better understanding of circumstances in individual countries helps achieve a serious response.   

Dong-Seok Roh
Jeffrey Logan
Jin-Gyu Oh
Jinwoo Kim
Sung Bong Jo
William Chandler
0

Developing Countries & Global Climate Change: Electric Power Options for Growth

Developing Countries & Global Climate Change: Electric Power Options for Growth

June 1999

By: Mark Bernstein, Pam Bromley, Jeff Hagen, Scott Hassell, Robert Lempert, Jorge Munoz, David Robalino, RAND

Press Release

Download Entire Report (pdf)

Foreword

Eileen Claussen, Executive Director, Pew Center on Global Climate Change

Understanding the possibilities for greenhouse gas emission reductions in developing countriescan inform the debate over long-term equitable commitments and global participation in a climate change regime. This study investigates policy and technology choices in the electric power sector that can lower carbon dioxide and other air emissions, while maintaining or improving economic growth.

The standard projection shows electric sector CO2 emissions in developing countries nearly tripling over the next twenty years as a result of investments of approximately $1.7 trillion. This sector already represents 10 percent of global emissions. The study presents four alternative paths for new power generation that could maintain economic growth and reduce new emissions to levels below this projection:

  • Including the costs of electricity delivery - not just generation - makes planning and investment decisions more efficient and makes distributed renewable energy more viable, decreasing CO2 emissions by up to 2.5 percent;
  • Increasing privatization of the electricity sector could reduce CO2 emissions by up to 1 percent and boost economic benefits by up to 5 percent;
  • Using low-emissions technologies - for example, increasing the use of natural gas and renew-ables - could reduce CO2 emissions by almost 25 percent while producing the same economic benefits; and
  • Increasing the efficiency of electricity supply and demand could reduce CO2 emissions by roughly 10 percent in one scenario.

T hese findings were based on an aggregated analysis and may not hold for individual countries.For similar benefits to accrue, specific reforms that account for national conditions would have to be implemented in each country. Countries could also participate in the Clean Development Mechanism to increase the available up-front financing to accomplish these reforms.

This report is the fourth in a series by the Center for Climate and Energy Solutions examining policy questions both domestically and internationally. Five case studies - evaluating electric power options in more detail - will be published for Argentina, Brazil, China, India, and the Republic of Korea.

The Pew Center was established in 1998 by the Pew Charitable Trusts to bring a new coopera-tive approach and critical scientific, economic, and technological expertise to the global climate change debate. The Pew Center and its Business Environmental Leadership Council believe that climate change is serious business. Better understanding of those sensible actions that reduce emissions without hurt-ing the economy brings us closer to a serious solution.

Executive Summary

In 1995, 34 percent of global carbon dioxide (CO2 ) emissions were produced by electric power generation, approximately one-third of which came from developing countries. Between 1995 and 2020, developing countries will invest roughly $1.7 trillion building 50 percent of all new global power generation capacity. If these investments are made according to business-as-usual (BAU) investment trends, CO2 emissions from developing country power generation will nearly triple their 1995 levels within 20 years.

This report presents the results of a RAND study that suggests that BAU investment trends are not the only path to strong economic growth. If developing countries adopt different policies and plan-ning methods for their power generation sectors, technologies other than those included in BAU projec-tions could provide lower local and global environmental impacts and produce similar or even higher economic benefits. This study compared the possible impacts that different policies and technology mixes could have on economic growth, air pollution, and CO2 emissions from new electric power genera-tion in developing countries.

In order to consistently and quantitatively examine the economic and environmental impacts of different policies and mixes of power generation technologies, this study developed a simulation model that sought to capture the macro-level relationships between electric power generation, economic growth, and capital investment in the world's developing countries. The simulation model was used to compare current forecasts and BAU trends for electric power to several policy alternatives that also met projected capacity needs. The policy alternatives investigated in this study were: the inclusion of infra-structure costs in new capacity investment decisions; the acceleration of private-sector participation in power generation; the use of low-emissions technologies; and improvements in energy efficiency.

Figure ES-1 presents the range of potential CO2 emissions based on this study's findings. The upper bound of this range shows that accelerated privatization could, under some circumstances, increase new CO2 emissions up to 20 percent relative to BAU investment trends that include infrastruc-ture costs. Other scenarios could decrease the expected growth. Low-emissions technologies could reduce that growth by almost half.

0
Syndicate content