Globalization of supply chains has resulted in rapid increases in emission transfers from the developing to the developed world. As outsourcing has risen, developed countries have been able to decarbonize domestically, at the expense of increased emissions in developing countries. However, the rapid improvement of carbon efficiency in developing regions together with the post-2008 deceleration in international trade raises the question of whether such embodied emission transfers have peaked. Here we update historical analysis, finding that emission transfers between OECD and non-OECD countries peaked in 2006, and have been declining since. The reversal is principally due to the reduction in the emissions intensity of traded goods, rather than the volume of trade. A more recent decline in embodied emissions transfers is also observed in trade between developing countries. We analyse whether these trends are likely to continue, by exploring a baseline and a Nationally Determined Contribution (NDC) scenario with the Macro-econometric Energy-Environment-Economy Model (E3ME) model. The results suggest that absolute embodied emissions will plateau at current levels or slowly return to pre-2008-crisis levels, and differences between the NDC and baseline scenarios imply that NDC policies will not result in significant carbon leakage. However, the share of national footprint embodied in imports, at least for countries with ambitious decarbonization policies, will likely increase. This suggests that, despite the worldwide stabilization of emissions transfers, addressing emissions embodied in imports will become increasingly important for reducing carbon footprints. Key policy insights. Emissions embodied in imports have plateaued since 2006, and are unlikely to return to the peak of the mid-2000s.. For developed countries, as domestic decarbonization occurs, the share of emissions embodied in imports as a percentage of the total national carbon footprint will increase.. The Paris NDCs in themselves are unlikely to cause significant carbon leakage.. Climate policy will ideally focus on reducing both production and consumption emissions, through a variety of mechanisms, especially centred around international assistance.
As the world increasingly runs up against physical constraints of energy, land, water, and food, there is a growing role for policy to reduce environmental pressures without adversely affecting increases in prosperity. There is therefore a need for policy makers to understand the potential trade-offs and/or synergies between the uses of these different resources, i.e., to encompass the water–energy–food–land nexus for policy and decision making, where it is no longer possible to ignore the limitations in land availability and its links to other natural resources. This paper proposes a modelling approach to help to assess various policies from a nexus perspective. The global macro-econometric model (E3ME) explores a low-carbon transition through different sets of energy and climate policies applied at different spatial scales. The limitations of the E3ME model in assessing nexus interactions are discussed. The paper also argues and offers an explanation for why no single traditional or classic model has the potential to cover all parts of the nexus in a satisfactory way, including feedback loops and interactions between nexus components. Other approaches and methodologies suitable for complexity science modelling (e.g., system dynamics modelling) are proposed, providing a possible means to capture the holistic approach of the nexus in policy-making by including causal and feedback loops to the model components. Based on three case studies in Europe, the paper clarifies the different steps (from policy design towards conceptual model) in modelling the nexus linkages and interactions at the national and regional levels. One case study (The Netherlands) considers national low-carbon transitions at national level. Two other case studies (Latvia and southwest UK) focus on how renewable energy may impact the nexus. A framework is proposed for the generic application of quantitative modelling approaches to assess nexus linkages. The value of the nexus concept for the efficient use of resources is demonstrated, and recommendations for policies supporting the nexus are presented.
This article gives a detailed account of part of the modelling that was carried out for the assessment of the EU's proposed energy and climate targets for 2030. Using the macro-econometric simulation model, E3ME, and drawing on results from the PRIMES energy systems model, it shows that a 40% reduction in GHG emissions (compared to 1990 levels) could lead to an increase in employment of up to 0.7 million jobs in Europe. Furthermore, if the same GHG reduction target was combined with targets for renewables and energy efficiency, the net increase in jobs could be as high as 1.2 million. Both results are in contrast to the standard findings from computable general equilibrium (CGE) models, reflecting the different underlying assumptions (e.g. labour supply) to the modelling approach. Additional sensitivity testing shows that the ways in which the energy efficiency and renewable measures are funded are important factors in determining overall economic impact. Policy relevanceIn recent years there has been much debate as to whether the European Union should have a single GHG reduction target or a set of targets that also cover renewables and energy efficiency. This paper elaborates on part of the modelling that was carried out for the official assessment of the European Union's proposed energy and climate targets for 2030. Using an empirical, model-based approach, it compares a scenario where there is a single 40% GHG reduction target to a scenario that also includes a 30% renewables target and stricter energy efficiency standards. The model results show that the large investment stimulus needed to meet the combined targets leads to higher levels of GDP and employment. This suggests that there could be medium-term economic and social benefits to including all three targets in the future energy and climate package.
Land, food, energy, water and climate are linked and interconnected into a Nexus, characterized by complexity and feedbacks. An integrated management of the Nexus is critical to understand conflicts/synergies and secure efficient and sustainable use of resources, especially under climate change. The Nexus perspective is applied to Sardinia, as regional case study, to better understand and improve integrated resource management and relevant policy initiatives. Vulnerability of Sardinia Nexus is assessed under several climate projections by articulated balances of resources (water, energy) availability and sustainable development goals, at regional and subregional scales, accounting for demands and conflicts among key economic sectors (agriculture, hydro-power, tourism).
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