In this paper, we quantify the energy transition and economic consequences of the long-term targets from the Paris agreement, with a particular focus on the targets of limiting global warming by the end of the century to 2 and 1.5 °C. The study assumes early actions and quantifies the market penetration of low carbon technologies, the emission pathways and the economic costs for an efficient reduction of greenhouse gas (GHG) emissions such that the temperature limit is not exceeded. We evaluate the potential role of direct air capture (DAC) and its impact on policy costs and energy consumption. DAC is a technology that removes emissions directly from the atmosphere contributing to negative carbon emissions. We find that, with our modelling assumptions, limiting global temperature to 1.5 °C is only possible when using DAC. Our results show that the DAC technology can play an important role in realising deep decarbonisation goals and in the reduction of regional and global mitigation costs with stringent targets. DAC acts a substitute to Bio-Energy with Carbon Capture and Storage (BECCS) in the stringent scenarios. For this analysis, we use the model MERGE-ETL, a technology-rich integrated assessment model with endogenous learning.
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MERGE-ETL is developed and maintained by the Energy Economics Group in the Paul Scherrer Institute.
Note that an infeasible optimization problem does not necessarily imply an infeasible target in the real world. It refers to the fact that with the current modelling assumptions, the problem cannot be solved.
Cumulative economic output losses are calculated using a 5% discount rate.
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S. Kypreos thanks ETSAP for supporting his participation to the IEW-2015. A. Marcucci and E. Panos thank the financial support of Swiss Competence Center for Energy Research (SCCER) CREST and SCCER—Supply of Electricity, which are in turn financially supported by the Swiss Commission for Technology and Innovation (CTI). We would also like to thank the three anonymous reviewers for their valuable suggestions and comments.
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Marcucci, A., Kypreos, S. & Panos, E. The road to achieving the long-term Paris targets: energy transition and the role of direct air capture. Climatic Change 144, 181–193 (2017). https://doi.org/10.1007/s10584-017-2051-8