Mitigation Pathways for Net Zero GHG Emission by 2050: A Case of - - PowerPoint PPT Presentation

Mitigation Pathways for Net Zero GHG Emission by 2050: A Case of Nepal

Ram M. Shrestha1, Bundit Limmeechokchai2 Bijay Bahadur Pradhan2 Salony Rajbhandary2

1Asian Institute of Technology and Management, Lalitpur, Nepal 2Sirindhorn International Institute of Technology, Thammasat University, Thailand

24th AIM International Workshop, November 5-6, 2018 National Institute of Environmental Studies (NIES), Tsukuba, Japan

Key Issues

• GHG missions from energy use under different

economic growth scenarios

• Would net zero emission be achievable in

2050 under medium economic growth scenario?

• How big should be the carbon price?
• Role of afforestation?

Implications of Different Economic Growth Scenarios

GDP Projection

2018-2020 2020-2025 2025-2030 2030-2035 2035-2040 2040-2045 2045-2050 Low 5% 5% 5% 5% 5% 5% 5% Medium 5.5% 6.5% 7% 7% 7.5% 7.25% 7% High 5.5% 8% 9% 9.5% 10% 9.5% 9%

50 100 150 200 250 300 350 400 2015 2020 2025 2030 2035 2040 2045 2050 billion (2015) US$ high medium low 2000 4000 6000 8000 10000 12000 2015 2020 2025 2030 2035 2040 2045 2050 GDP per capita (2015 US$) high medium low

GDP GDP per Capita

Total Primary Energy Supply under Different Economic Growth Scenarios

TPES would grow at CAGR of

• 2.0% in BAU-L to 5.0% in BAU-H

Biomass would grow less rapidly at CAGR of

• 0.6% in BAU-L, 1.6% in BAU-M and 2.8% in

BAU-H Hydro power would grow more rapidly at CGAR of

• 8.1% in BAU-L, 10.0% in BAU-M and

11.6% in BAU-H

10 20 30 40 50 60 70 2015 2025 2035 2045 Mtoe BAU-H BAU-M BAU-L 0% 20% 40% 60% 80% 100% BAU-L BAU-M BAU-H BAU-L BAU-M BAU-H 2015 2030 2050 Elec Import Other Renewables Hydro Petroleum Coal Biomass

TPES Energy Mix

Fossil Fuel Consumption under Different Economic Growth Scenarios

Coal use would increase at a CAGR of

• 3.7% in BAU-L, 5.4% in BAU-M and

7.3% in BAU-H Oil use would increase at a CAGR of

• 3.8% in BAU-L, 5.5% in BAU-M and

7.9% in BAU-H

2000 4000 6000 8000 10000 12000 14000 16000 18000 2010 2020 2030 2040 2050 2060 Mtoe

Petroleum

1000 2000 3000 4000 5000 6000 7000 2010 2020 2030 2040 2050 2060 Mtoe

Coal

BAU-H BAU-M BAU-L

GHG Emissions

Cumulative GHG emissions during 2015- 2050

• 497 MtCO2e in BAU-L
• 658 MtCO2e in BAU-M
• 927 MtCO2e in BAU-H

GHG emissions would grow during 2015- 2050 at

• 2.9% in BAU-l
• 4.5% in BAU-M
• 6.5% in BAU-H

10 20 30 40 50 60 70 80 2015 2020 2025 2030 2035 2040 2045 2050 MtCO2eq BAU-H BAU-M BAU-L 0% 20% 40% 60% 80% 100% BAU-L BAU-M BAU-H BAU-L BAU-M BAU-H 2015 2030 2050 Agriculture Commercial Power Industry Residential Transport

Growth of GHG Emission Sectoral Shares in GHG Emission

Achieving the Net Zero Emission Target in Medium Economic Growth Scenario

• Effect of carbon tax on energy related GHG emission reduction?
• Role of sequestration?

Carbon Tax Profile

2020 2030 2040 2050 CT-L

49 80 130 211

CT-H

163 265 432 704

100 200 300 400 500 600 700 800 2020 2030 2040 2050 Carbon price (2015 US$) CT-L CT-H

CT-L: average discounted carbon price of 30US$ at 2010 US$ based on GCAM model (discounted at 5%) CT-H: average discounted carbon price of 100 US$ at 2010 US$ based on REMIND model (discounted at 5%)

Primary Energy Supply under Carbon Tax Scenarios

5 10 15 20 25 30 35 40 BAU-M CT-L CT-H BAU-M CT-L CT-H 2015 2030 2050 Mtoe Elec Import Other Renewables Hydro Petroleum Coal Biomass

TPES in 2050 would decrease by 7.6% in CT-L and 10.8% in CT-H

TPES

Fossil Fuel Consumption under Carbon Tax Scenarios

In 2030, Fossil fuel consumption would decrease by

• 35.0% in CT-L and 48.4% in CT-H

In 2050, Fossil fuel consumption would decrease by

• 43.2% in CT-L and 57.1% in CT-H

During 2015-2050, cumulative fossil fuel consumption would decrease by 34.4% in CT-L and 48.8% in CT-H

2 4 6 8 10 12 2010 2020 2030 2040 2050 Mtoe

BAU-M CT-L CT-H

Fossil Fuel Consumption

Primary Energy Mix in 2030 under Carbon Tax Scenarios

Biomass 69% Coal 5% Petroleum 16% Hydro 9% Other Renewables 1% Elec Import 0%

BAU

16.6 Mtoe

Biomass 73% Coal 3% Petroleum 11% Hydro 12% Other Renewables 1% Elec Import 0%

CT-L

16.3 Mtoe

Biomass 67% Coal 3% Petroleum 9% Hydro 20% Other Renewables 1% Elec Import 0%

CT-H

14.2 Mtoe

• Biomass use in industrial sector would increase under both CT-L and CT-H
• In CT-H, biomass use in residential sector would be displaced by electricity

Primary Energy Mix in 2050 under Carbon Tax Scenarios

Biomass 45% Coal 10% Petroleum 17% Hydro 25% Other Renewables 3% Elec Import 0%

BAU

35.7 Mtoe

Biomass 47% Coal 3% Petroleum 11% Hydro 36% Other Renewables 3% Elec Import 0%

CT-L

33 Mtoe

Biomass 46% Coal 4% Petroleum 7% Hydro 39% Other Renewables 4% Elec Import 0%

CT-H

31.8 Mtoe

• Biomass use in industrial sector would increase under both CT-L and CT-H
• Electricity would replace biomass use in residential sector under both CT-L and CT-H

GHG Emissions under Carbon Tax Scenarios

In 2030, GHG emissions would be reduced by

• 28% in CT-L and 43% in CT-H

In 2050, GHG emissions would be reduced by

• 43% in CT-L and 55% in CT-H

5 10 15 20 25 30 35 40 45 2015 2020 2025 2030 2035 2040 2045 2050 MtCO2e

CT-L

Agriculture Commercial Power Transport Residential Industrial

BAU-M Emission CT-L Emission

Reduction from 5 10 15 20 25 30 35 40 45 2015 2020 2025 2030 2035 2040 2045 2050 MtCO2e

CT-H

Agriculture Commercial Power Transport Residential Industrial

BAU-M Emission CT-H Emission

Reduction from

In 2050 CT-H: Largest reduction from Industrial sector, then from transport, residential and

• thers

CT-L: largest reduction from industrial, then from residential, transport and others

Local Pollutant Emissions

NOx emission would decrease by

• 5% in CT-L and 18% in CT-H in 2030
• 21% in CT-L and 54% in CT-H in 2050

SO2 emission would decrease by

• 21% in CT-L and 28% in CT-H in 2030
• 46% in CT-L and 59% in CT-H in 2050

50 100 150 200 250 300 BAUM CT-L CT-H BAUM CT-L CT-H 2015 2030 2050 kton NOx NOx 5 10 15 20 25 30 BAUM CT-L CT-H BAUM CT-L CT-H 2015 2030 2050 kton SO2 SO2

Electricity Generation

In 2030, electricity generation would increase by

• 45% in CT-L and 101% in CT-H

In 2050, electricity generation would increase by

• 30% in CT-L and 15% in CT-H

In 2030, installed capacity would increase by

• 1,772 MW in CT-L and 8,325 MW in CT-H

In 2050, installed capacity would increase by

• 3,969 MW in CT-L and 13,119 MW in CT-H

25 50 75 100 125 150 175 2015 2020 2025 2030 2035 2040 2045 2050 TWh CT-H CT-L BAU-M 5 10 15 20 25 30 35 40 45 50 2015 2020 2025 2030 2035 2040 2045 2050 GW BAU-M CT-L CT-H

Solar PV is cost-effective at $600/kW

Energy Security Implications

Net Energy Import Dependency, %

BAU-M CT-L CT-H 2015 14.8 14.8 14.8 2030 21.5 13.8 12.2 2050 26.8 14.7 10.6

Major technological shift

Mitigation options in the Residential and Commercial Sectors:

• Improved cook stoves
• Biogas cooking
• Electric cooking
• Solar water heater
• LED lamps in lighting

Mitigation options in Agriculture

• Electric pumps
• Electric tractors

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Mitigation options in the Transport Sector:

• Biofuel vehicles (ethanol and biodiesel

blend) in CT-L

• Flexi-fuel vehicles in CT-L
• Electric cars in both scenarios
• Fully Electric vehicles in CT-H (including

trucks and buses) Mitigation options in the Industrial Sector

• Efficient electric motor (motive power)
• Improved fixed chimney brick kiln
• Energy efficient boilers
• Biomass fired boiler
• Biomass in Brick industry
• Fuel mix changes to significantly higher use of renewable energy (mainly hydro) based

electricity and bioenergy

• Use of energy efficient technologies

Total cost and investment Requirement (2015-2050)

Investment Requirement would increase by

• 3.4% (19.4 billion USD) in CT-L and
• 9.9% (56.5 billion USD) in CT-H

Total cost would increase by

• 6.1% (46 billion USD) in CT-L and
• 20.3% (153.3 billion USD) in CT-H

572 591 628 540 560 580 600 620 640 BAU-M CT-L CT-H billion USD

Investment

754 800 907 100 200 300 400 500 600 700 800 900 1000 BAU-M CT-L CT-H billion USD

Total Cost

Role of Carbon Price and Afforestation

Afforestation Potential

• Forest coverage is 44% in the BAU case during

2020-2050.

• Sequestration rate of existing forest would

remain at 24.5 MtCO2/year in the BAU case.

• Additional 8% of land available for

afforestation (Sequestration potential = 13 MtCO2e).

Would net zero emission be possible under CT $100?

• 40
• 20

20 40 60 80 100

• 40
• 20

20 40 60 80 100 2020 2030 2040 2050 MtCO₂e MtCO₂e

BAU emission (without afforestation)

Forest Sequestration (Existing) Agriculture Energy BAU Net Emission

• 40
• 20

20 40 60 80 100

• 40
• 20

20 40 60 80 100 2020 2030 2040 2050 MtCO₂e MtCO₂e

Emissions under CT $100 (without afforestation) Net emission in 2050 without afforestation = 51.3 MtCO2e Net emission in 2050 without afforestation = 20.8 MtCO2e Additional sequestration potential = 13 MtCO2e With the afforestation potential, net zero emission (NZE) feasible during 2020-2040 but infeasible in 2050 and thereafter.

What is needed to achieve net zero emission by 2050?

Net emission in 2050 without afforestation = 11.7 MtCO2e With carbon tax of $325, additional sequestration required to achieve net zero emission: 2.9 MtCO2e in 2020; 2.5 MtCO2e in 2030 8.0 MtCO2e in 2040; 11.7 MtCO2e in 2050 (about 90% of afforestation potential)

• 40
• 20

20 40 60

• 40
• 20

20 40 60 2020 2030 2040 2050 MtCO₂e MtCO₂e

Emissions with CT $325 (without afforestation)

Forest Sequestration (Existing) Agriculture (with mitigation) Energy CT-H Net Emission

High carbon tax of $325 needed to achieve net zero emission in 2050.

Key Insights

• Achieving 1.5°C target would require very high use of

electricity based mainly on hydropower in all sectors.

• Carbon tax of $325/tCO2e (average discounted value) would

be needed for achieving net zero emission by 2050 under medium economic growth.

• Higher tax above $325/tCO2e would not achieve significant

decrease in energy related emissions

• In addition 90% of afforestation potential would have to be

used to achieve net zero emission by 2050.

Preliminary Results of CGE Analysis

• n Economy-wide Effects of GHG

Emission Reduction

• Based on an ongoing work by Salony Rajbhandari et al.,2018.

GHG Emissions in Nepal under Medium Economic Growth Scenario

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CAGR during 2010-2050 = 4.51% Estimated using AIM/Enduse

Preliminary Results: Impact on GDP

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GDP loss of 0.8% to 1.2% in 2050 under ERT scenarios

Cumulative GDP loss in the range of 0.49% to 0.67%

Preliminary Results:

GHG Intensity & GHG Price

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Higher GHG emission reduction targets imposes higher GHG prices Increasing emission reduction targets causes reduction in the GHG emission intensities

• GHG reductions vary from 37% to 40% in 2030 and

55% to 59% in 2050 under the ERT10 to ERT30 scenarios as compared to the BAU emissions. Manufacturing Industries & land transport sectors

• The major contributors to GHG reductions

Increasing electricity use & decreasing fossil fuel consumptions

Some Future Tasks of Nepal CGE Model

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Assessment of energy, environmental & economy-wide implications of

• Carbon tax
• Energy efficiency improvement in the energy supply and final demand

sectors.

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Thank You