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General equilibrium models for Norway and technological change - some lessons learned. Taran Fæhn, SSB Modellforum CenSES OG CREE 24. oktober i 2013. Background.
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Taran Fæhn, SSB
CenSES OG CREE
24. oktober i 2013
Traditional approaches to abatement costs overestimate the costs of climate policies - potential abatement options are omitted
TOP-DOWN models – CGE (SSB’s MSG6)
Complement each other Iteration of integration are possible solutions
(Bjertnæs,Martinsen&Tsygankova 2013, Martinsen 2011)
1) Shiftedtheclimate policy (a uniform CO2tax) in MARKAL
2) Madethe same shift in MSG
3a) AddedontoMSG’semissioneffectsthose from MARKAL
4a) Alsoinsertedannuitiesofinvestment and operationcostsinto MSG
5a) Studiedrevenues and recycling in the MSG modelwithnoiterations
3b) Feddemandresponses from MSG6 into MARKAL
4b) Re-simulatedthetaxshift in MARKAL-account for endo. demand
(labour-consumingcommunication, solutions, many runs)
Easier to usethe inputs (beforethemodel’sendogeneity) than
the outputs (aftersimulation) of MARKAL.
Social abatement costs of meeting global, European and domestic emission caps within 2020 (Stortingetsklimaforlik)
illustration: Petroleum industry:
The MSG adjustments:
10 detailed projects, types:
Wind power installations
Power efficiency improvements
The technological abatement curve
Fæhn og Jacobsen, 2010(ØA5 /2010)
Allowing for technologicaladaptations
The significance in terms ofabatementcosts
Same domesticcap in MSG6 and MSG-TECH
Marginal costs fall to 1/3 comparedwiththose in a traditional CGE modelwhenallowing for agents’ technologyoptions (in manufacturing, petroleum and road transport).
Fæhn,Gulbrandsen&Lindegaard,2010; (Smføk 5)
Klimakur 2020 approachedthequestionofabatementcosts in two different ways – bottom-up and macroeconomicanalysis. Didtheanswerscoincide?
Systematicidentificationofthe optimal abatementoptions in bothapproaches
Fæhn, Isaksen&Rosnes; 2013 (SSB Report 39)
Whatabatementwilltakeplace in Norway given a carbon price as in the 2 degree scenario
Process: Studyinganswers from MSG-TECH and MARKAL/TIMES(IEA,2013)
Reference=New policy scenario (current and expectedpolicies)
Fæhn, Isaksen & Rosnes; 2013
(Bye&Jacobsen,2011; Heggedal&Jacobsen,2011)Until now presented modelling of diffusion – the costs are exogenous, but diffusion endogenous
Reasonable that technological development and cost reductions are endogenous in models of Norway?
We have modelled Norwegian R&D on CCS technologies og studied effects of public support and carbon pricing
Ambition: Make useofourlessonson hybrid modelling
SNoW-No under development
Bjertnæs Tsygankova&Martinsen, 2013 Energy Economics 39, 147-58
Bye&Jacobsen, 2011 Energy Economics 33/3, 543-55
Fæhn Gulbrandsen&Lindegaard, 2010 Samfunnsøkonomen5, 4-15
Fæhn Isaksen& Rosnes, 2013 Rapporter 39, SSB
Fæhn&Jacobsen, 2010 Økonomiske analyser 5, 11-16
Heggedal&Jacobsen, 2011 Resource&EnergyEconomics33/4,913-37
Klimakur2020, 2010 Rapport TA2590 KLIF (MDIR)
Martinsen, 2011 Energy Policy 39/6, 3327-36