CIRED

Nogent-sur-Marne, France
Nogent-sur-Marne, France

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Li J.,CIRED | Colombier M.,Institute du developpement durable et des relations internationales
Climatic Change | Year: 2011

The relevance and cost-effectiveness are key criteria for policymakers to select appropriate policy and economic instruments for reducing carbon emissions. Here we assess the applicability of carbon finance instruments for the improvement in building energy efficiency by adopting the high efficiency standards as well as advanced energy supply systems, building on a case study in a northern city in China. We find that upgrading the current Chinese BEE standard to one of the best practices in the world coupled with the state-of-the-art energy supply system implies an abatement cost at 16US$/tCO2, which is compatible with the international carbon market price. The institutional reorganization turns out to be indispensable to facilitate the implementation of the proposed scheme of local government-led energy efficiency programme in the form of programmatic CDM in China's buildings sector. We show that with international support such as carbon finance, the BEE improvement will facilitate city's transition to low-carbon supply in the longer term. More importantly, it is argued that demand-side energy performance improvement in buildings should be considered a prerequisite to shifting low-carbon energy supply technologies such as fuel-switching, renewable power generation and Carbon Capture and Storage to address climate mitigation in light of cost-effectiveness and environmental integrity. © 2010 Springer Science+Business Media B.V.


Leblois A.,CIRED | Quirion P.,Lmd Ipsl Laboratoire Of Meteorologie Dynamique Institute Pierre Simon Laplace
Meteorological Applications | Year: 2013

In many low-income countries, agriculture is mostly rainfed and crop yield depends highly on climatic factors. Furthermore, farmers have little access to traditional crop insurance, which suffers from high information asymmetry and transaction costs. Insurances based on meteorological indices could fill this gap since they do not face such drawbacks. However, a full-scale implementation has been slow so far. In this article, the most advanced projects that have taken place in developing countries using these types of crop insurances are described. Following this, the methodology that has been used to design such projects in order to choose the meteorological index, the indemnity schedule and the insurance premium, is described. Finally the main research issues are discussed. In particular, more research is needed on implementation, assessment of benefits, how to deal with climate change, spatial variability of weather and interactions with other hedging methods. © 2011 Royal Meteorological Society.


Roudier P.,CIRED | Sultan B.,University Pierre and Marie Curie | Quirion P.,French National Center for Scientific Research | Berg A.,CIRED
Global Environmental Change | Year: 2011

In West Africa, agriculture, mainly rainfed, is a major economic sector and the one most vulnerable to climate change. A meta-database of future crop yields, built up from 16 recent studies, is used to provide an overall assessment of the potential impact of climate change on yields, and to analyze sources of uncertainty.Despite a large dispersion of yield changes ranging from -50% to +90%, the median is a yield loss near -11%. This negative impact is assessed by both empirical and process-based crop models whereas the Ricardian approach gives very contrasted results, even within a single study. The predicted impact is larger in northern West Africa (Sudano-Sahelian countries, -18% median response) than in southern West Africa (Guinean countries, -13%) which is likely due to drier and warmer projections in the northern part of West Africa. Moreover, negative impacts on crop productivity increase in severity as warming intensifies, with a median yield loss near -15% with most intense warming, highlighting the importance of global warming mitigation.The consistently negative impact of climate change results mainly from the temperature whose increase projected by climate models is much larger relative to precipitation change. However, rainfall changes, still uncertain in climate projections, have the potential to exacerbate or mitigate this impact depending on whether rainfall decreases or increases. Finally, results highlight the pivotal role that the carbon fertilization effect may have on the sign and amplitude of change in crop yields. This effect is particularly strong for a high carbon dioxide concentration scenario and for C3 crops (e.g. soybean, cassava). As staple crops are mainly C4 (e.g. maize, millet, sorghum) in WA, this positive effect is less significant for the region. © 2011 Elsevier Ltd.


Branger F.,CIRED | Quirion P.,French National Center for Scientific Research
Wiley Interdisciplinary Reviews: Climate Change | Year: 2014

In a world with uneven climate policies, the carbon price differentials across regions could shift the production of energy-intensive goods from carbon-constrained countries to 'carbon havens', or countries with laxer climate policy. This would reduce the environmental benefits of the policy (carbon leakage) while potentially damaging the economy (competitiveness concerns). A review on these questions is provided in this article. First we discuss the main terms involved, such as carbon leakage, competitiveness, sectors at risk, or climate spillovers. Then we analyze the studies evaluating the carbon leakage risk. Most ex ante modeling studies conclude to leakage rates in the range of 5-20% (if no option to mitigate leakage is implemented), whereas ex post econometric studies have not revealed statistically significant evidence of leakage. Different policy options to face these issues are then examined with an emphasis on Border Carbon Adjustments (BCA). BCA consist in reducing the carbon price differentials of the goods traded between countries. Properly implemented, they can reduce leakage (by around 10 percentage points in ex ante modeling studies) in a cost-effective way but are controversial because they shift a part of the abatement costs from abating countries to nonabating countries. Their impact on international negotiations is unclear: they could encourage third countries to join the abating coalition or trigger a trade war. Besides, their consistency with World Trade Organization (WTO) rules is contentious among legal experts. © 2013 John Wiley & Sons, Ltd.


Li J.,CIRED | Wang X.,Institute du developpement durable et des relations internationals IDDRI
Energy Policy | Year: 2012

The twelfth five-year plan (FYP) endorsed by the People's National Congress in March 2011 plays a crucial role in shaping China's development trajectory over the next decades, and especially for the fulfillment of the 40-45 carbon intensity reduction target by 2020. The plan will condition both the medium and long term perspectives of economic restructuring, rebalance between the inclusive economic growth and environmental objectives, which are compounded by multiple constraints faced by China such as aging population, natural resources depletion, energy supply security and environmental deterioration. This article investigates the major energy and climate targets and actions specified in the 12th FYP to gain insights into the nature and magnitude of challenges and difficulties with regard to the medium and long run economic and environmental policies. It points out that China should articulate sectoral policies with the global climate mitigation targets to avoid long term carbon lock-in. Based on an in-depth analysis of the objectives in the plan, it is argued that the implementation should include mainstreaming developments of appropriate instruments to support cost-effective energy efficiency improvements and carbon intensity reduction in the next five years. © 2011 Elsevier Ltd.


This econometric study assesses the efficiency of the income tax credit system introduced in France in 2005 on investment decisions for household retrofits, focusing on insulation measures. A logit model with random individual effects is estimated using an unbalanced panel of 23,879 households surveyed over the period 2002-2011. An estimation in difference is performed to identify the impact of the policy. The tax credit is found to have had no significant effect during the first two years, suggesting a latency period related to inertia in households' investment decisions, possibly due to the complexity of the tax credit scheme. The tax credit had an increasing, significant positive effect from 2007 to 2010, before slightly decreasing in 2011. This is in line with changes in the tax credit rates, suggesting a correlation with the level of subsidy. Defined as the situation in which the subsidized household would have invested even in the absence of the subsidy, free-ridership progressively decreased over the period, was lower for insulation of opaque surfaces (roofs, walls, etc.) than for insulation of windows and depended on individual characteristics. The estimated average proportion of free-riders varies between 40% and 85% after 2006. In addition, we assess the potential bias caused by time-varying unobservable variables and conclude that our estimates of the impacts of the policy are conservative. © 2014 Elsevier B.V.


Vogt-Schilb A.,CIRED | Hallegatte S.,The World Bank
Energy Policy | Year: 2014

Decision makers facing abatement targets need to decide which abatement measures to implement, and in which order. Measure-explicit marginal abatement cost curves depict the cost and abating potential of available mitigation options. Using a simple intertemporal optimization model, we demonstrate why this information is not sufficient to design emission reduction strategies. Because the measures required to achieve ambitious emission reductions cannot be implemented overnight, the optimal strategy to reach a short-term target depends on longer-term targets. For instance, the best strategy to achieve European's -20% by 2020 target may be to implement some expensive, high-potential, and long-to-implement options required to meet the -75% by 2050 target. Using just the cheapest abatement options to reach the 2020 target can create a carbon-intensive lock-in and make the 2050 target too expensive to reach. Designing mitigation policies requires information on the speed at which various measures to curb greenhouse gas emissions can be implemented, in addition to the information on the costs and potential of such measures provided by marginal abatement cost curves. © 2013 Elsevier Ltd.


How to sustain rapid economic and urban growth with minimised detriment to environment is a key challenge for sustainable development and climate change mitigation in developing countries, which face constraints of technical and financial resources scarcity as well as dearth of infrastructure governance capacity. This paper attempts to address this question by investigating the driving forces of transport demand and relevant policy measures that facilitate mitigating GHG emissions in the urban transport sector in Indian cities based on a critical review of the literature. Our overview of existing literature and international experiences suggests that it is critical to improve urban governance in transport infrastructure quality and develop efficient public transport, coupled with integrated land use/transport planning as well as economic instruments. This will allow Indian cities to embark on a sustainable growth pathway by decoupling transport services demand of GHG emissions in the longer term. Appropriate policy instruments need to be selected to reconcile the imperatives of economic and urban growth, aspiration to higher quality of life, improvements in social welfare, urban transport-related energy consumption and GHG emissions mitigation target in Indian cities. © 2011 Elsevier Ltd.


Finon D.,CIRED
Climate Policy | Year: 2012

Policy instruments for carbon capture and storage (CCS) technology investment during the learning phase are analysed and compared. The focus is on specific barriers to investment in learning during early commercial deployment. Imperfections in the carbon price signal and market failures from barriers indicate a need for support during the learning investment phase and the initial roll out of CCS in electricity generation. Different ways for CCS technology to cross the so-called investment 'death valley' are analysed and compared: a command and control instrument (CCS mandate), investment support (grant, tax credit, loan guarantee, subsidy by trust fund) and production subsidies (guaranteed carbon price, feed-in price, etc.). Three criteria are used in this comparison: effectiveness, static efficiency and dynamic efficiency. Policy instruments need to be adapted to the technological and commercial maturity of the CCS system. Mandate policies require handling with much care, and subsidization mechanisms must be designed to be market-oriented. © 2012 Copyright Taylor and Francis Group, LLC.


The mainstream community of energy experts is not aware of the long-term impacts that carbon policies directly concerned with promoting the development of low-carbon technologies produce on the electricity market regime. Long-term market coordination should be replaced by public coordination with long-term arrangements. The current market coordination makes carbon pricing ineffective in orienting investors towards capital-intensive low-carbon technologies. Fossil fuel generation technologies are preferred because their investment risks are much lower in the market regime, even with a high but unstable carbon price. Thus, in order to avoid delaying investment that is aimed at the decarbonization of the electricity system, a number of new market arrangements that lower the investment risk of low-carbon technologies and provide output-based subsidization have or are being selected by governments. As the use of low-carbon equipment to produce electricity develops, long-term market coordination for other technologies (e.g. peaking units, combined cycle gas turbine) will fade away because they alter the market price setting. Thus it is likely that, in the future, public coordination and planning will replace the decisions of market players not only for low-carbon technologies but also for every other type of capacity development. Policy relevance The development of renewables as promoted by both feed-in tariffs and green certificate obligations, which answer to different market failures, is well known. Similar long-term arrangements, which both subsidize and de-risk low-carbon investments for every small-sized and large-sized technology, shift learning costs and risks onto consumers. Energy experts and regulators have ignored that the expansion and generalization of these arrangements are changing the coordination function of the electricity markets. Apart from those in the UK, they are still unaware of the impacts that such technology-focused policies produce on the electricity market regime. The transition from market coordination to public coordination, which is inconsistent with the market principles of European electricity legislation, and long-term contracting is inevitable and should be anticipated. © 2013 Copyright Taylor and Francis Group, LLC.

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