Abstract
Chapter 3 generated costs for twenty emission reduction projects in eleven countries. These costs were higher than many studies have predicted and they, at least initially, suggest a different ranking or cost ‘hierarchy’ of emission reduction methods than is commonly held to exist. Many studies argue that emission reduction by demand side energy efficiency and fuel switching is inexpensive, that carbon sequestration is expensive and that there are many negative cost emission reduction opportunities (see section 4.3). Chapter 3 suggested a carbon hierarchy in which supply side energy efficiency projects are inexpensive, carbon sequestration is of moderate expense and emission reduction by fuel switching is expensive.
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Notes
The relationship between the additionality and carbon focus of a project is interesting. If a project is not carbon focused, but is focused on making a profit, the project will probably perform well in terms of additionality. If the project is making money by other means, it does not need to exaggerate the amount of carbon emission reduction that it achieves. By contrast, those projects that really are carbon focused may try to exaggerate the carbon emission reduction that they achieve, in order to attract funding and in order to secure as many carbon credits as possible.
This figure does not apply to carbon sequestration projects. However, the secondary benefits of carbon sequestration could be high.
If an allowance trading system, a firm’s pollution becomes a new financial asset of the firm and is consequently more imaginatively managed. This is not the case with an emission reduction credit trading system.
The relationship between economic and engineering studies is extremely interesting. Cline states that in one sense bottom up studies,’ serve as reassurance that physical options for reducing emissions exist on the engineer’s drawing board as well as on the economist’s spreadsheet’(Cline, 1992, p. 199)
Studies (such as this) that identify high cost emission reduction methods may tempt purveyors of these technologies not to enter the market or to reduce their emission reduction costs. This would have the result of making the prices given here seem high.
The five fuel switching projects are quite different: they are a coal to gas conversion project (in Poland); two waste to energy projects (Pakistan and Mauritius), a wind and solar power project (India) and a geothermal project (the Philippines).
The main differences between the models’ results are explained by the price elasticity of energy demand and the speed at which the capital stock can adjust: high price elasticity and high capital malleability imply lower taxes.
Meetings were held with Yamil Bonduki, Ministry of Environment and Natural Resources (7 March 1996), Luis Vilaneuva, Director of Energy Planning, Energy Planning Division, Ministry of Energy and Mines, (7 March 1996) and the Banco Interamericano de Desarrollo (Interamerican Development Bank).
For more information on the breakdown of Venezuela’s emissions, see appendix A.
Ci = 2.8 + 92.7 Ti + 0.0042 Wi
CFi, = 5.0 + 38.3 Ri + 0.0018 Wi
The moderate target sees a 31% fall in emissions from the 1987 level of 1.3 GtC emissions by the year 2015, the tough target a 76% fall.
The greenhouse gas abatement in the Zimbabwe option accrues from stopping agriculture and saving energy used in commercial farm tractors; yet this option ignores the costs to the nation of stopping commercial agriculture (Shukla p. 681-682)!
The GEF is not supporting Venezuelan projects to reduce gas flaring and venting. It did approve $10 million for a project to reduce pipeline leaks in the western Maracaibo district. The pipeline system was built in the 1930s and was partly updated in the 1970s. So fer, however, only $1 million had been forthcoming. The Venezuelan government believes the further $9 million may not be forthcoming.
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© 1998 Springer Science+Business Media Dordrecht
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Ridley, M.A. (1998). The Carbon Hierarchy Revisited. In: Lowering the Cost of Emission Reduction: Joint Implementation in the Framework Convention on Climate Change. Environment & Policy, vol 10. Springer, Dordrecht. https://doi.org/10.1007/978-94-011-5256-3_4
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