Evaluating multiple emission pathways for fixed cumulative carbon dioxide emissions from global-scale socioeconomic perspectives

Reducing carbon dioxide (CO₂) and other greenhouse gas (GHG) emissions is essential for preventing dangerous levels of climate change. Because it is in the interest of societies and policymakers to understand the socioeconomic impact of reducing GHG emissions, a number of analyses have been implemented that use different energy–economic and integrated assessment models (IAMs) (Clarke et al. 2009; Edenhofer et al. 2010; Jakob et al. 2012; Luderer et al. 2011; Masui et al. 2011; Matsumoto et al. 2015, 2016; Riahi et al. 2015, and many other studies). Many of these studies have used CO₂ or GHG concentration levels or their radiative forcing effect in 2100 as climate change targets (e.g., atmospheric CO₂ concentration at 450 ppm to meet the United Nations Framework Convention on Climate Change goal of limiting global warming to an increase of 2 °C since the pre-industrial Era).

Recently, it has been shown that cumulative CO₂ emissions are a good indicator of climate stabilization (Allen et al. 2009; IPCC 2013; Matthews et al. 2009; Meinshausen et al. 2009; Zickfeld et al. 2009). For example, the transient climate response to cumulative carbon emissions (TCRE; IPCC 2013) is defined as the global mean surface temperature change per 1000 gigatonnes of carbon (GtC) emitted to the atmosphere. Based on a range of 0.8–2.5 °C per 1000 GtC, the TCRE can be estimated for cumulative emissions of up to 2000 GtC or the period when temperatures peak (IPCC 2013). In Integrated Assessment Modeling (IAM) studies, this indicator is also used to analyze the socioeconomic impacts of achieving a climate target (e.g., the aforementioned 2 °C target). For example, Rogelj et al. (2013a) implemented a systematic analysis of how different levels of short-term emissions (i.e., emission targets for 2020) would impact the technological and economic feasibility of achieving the 2 °C target by 2100. They used a cumulative emission budget, i.e., a value of 1500 Gt of CO₂ (or 409 GtC) over the twenty-first century, as an indicator for staying below 2 °C, while developing different scenarios. They found that the probability of achieving the target depends strongly on the prospects of key energy technologies, as well as on the effectiveness of efficiency measures to limit the growth of energy demand. In addition, targeting lower short-term emission levels would allow the 2 °C target to be achieved under a wide range of assumptions. Riahi et al. (2015), who compared nine IAMs in their study, used a cumulative emission budget as an indicator to track this 2 °C target. They also focused on the implications of short-term policies (i.e., the national pledges issued at the United Nations Framework Convention on Climate Change Copenhagen Accord and the Cancun Agreement) on the costs and feasibility of long-term climate objectives and found that these higher near-term emissions (compared with the optimal pathways) caused significant increases in mitigation costs, increased the risk of low stabilization targets becoming unattainable, and reduced the chances of staying below the proposed temperature change target of 2 °C in case of overshoot. They also found that such pathways to 2030 would narrow policy choices. Similarly, Bertram et al. (2015) also used nine IAMs to examine how weak near-term (up to 2030) climate policies would affect the achievement of the target. They found that both the likelihood of overshooting the carbon budget and the urgency of reducing GHG emissions after 2030 increased, particularly with regard to negative emissions in the latter half of the century. They also found that much of the near-term emissions growth was a result of additional coal-fired power generation, suggesting that early retirement of coal energy and rapid increases in low-carbon technology are required. Wang et al. (2015) proposed a new scheme for carbon permit allocation considering international cooperation in climate mitigation from the perspective of equity that considers equality, historical responsibility, capability, and future development opportunities with different weights on each, based on the IAM analysis. They determined that developed countries should reduce emissions immediately, while developing countries should be allowed initially to increase their emissions. They also suggest that dynamic choice in the weights on the four equity indicators for international agreements and emissions trading for cost-efficiency are both of great importance.

Many of the above studies focus on socioeconomic impacts from a technological perspective and with regard to the viability of achieving global warming targets, while Wang et al. (2015) focus on an emissions trading scheme and its permit allocation from the viewpoint of equity. However, they do not explore the impact of taking different emission pathways on cumulative emission budgets or fixed cumulative CO₂ emissions (FCEs). Understanding such impacts is important for society because our capacity to reduce CO₂ emissions may vary each year, reflecting changes in factors such as technology and economic conditions. This is also important background information for policymakers required to define worldwide practices.

There are also many studies that analyze the 2 °C target from socioeconomic perspectives by considering a delay in action on emission reduction. Den Elzen et al. (2010) analyzed the costs of a delay in mitigation action and found that, although costs were lower in the short-term, they were higher in the longer term. They also noted that, if emission reductions were postponed to 2030, higher emissions in the earlier periods were not likely to be fully compensated for in later decades. Full compensation would require emission reduction rates in the coming decades that were much higher than those found in the scenario literature. Luderer et al. (2011) compared the results of three IAMs for success in achieving the 2 °C target (atmospheric CO₂ content of 450 ppm) and showed that a delay in climate policy or restrictions to the development of low-carbon technologies could result in substantial increases to mitigation costs. They also indicated that the target would be unachievable if the delay was extended to 2030. Van Vliet et al. (2012) compared several pathways for achieving the temperature target and found that the emission pathway under the Copenhagen Accord (conditional pledges) was more costly than that of immediate full participation to achieve the target. In addition, the Copenhagen Accord (unilateral pledges), which delays emission reduction compared with the full participation scenario, reduced the probability of achieving this target. Jakob et al. (2012), who used three IAMs, analyzed the situation in which the implementation of a global climate agreement was delayed or in which major emitters participated in the agreement at a later stage. They found that the delay of a global agreement until 2020 increases the cost of mitigation to achieve 450 ppm CO₂ by about 50 % compared with the least-cost scenario, and the delay to 2030 made the target infeasible. Kriegler et al. (2013a), which evaluated the cost and probability of achieving the 2 °C target assuming different emission levels and different long-term concentration levels in their Low climate IMpact scenarios and the Implications of required Tight emission control Strategies (LIMITS) Project, also showed similar implications. Luderer et al. (2013) analyzed the influence of a further delay in action and technology availability on implementation of the 2 °C target. They found that if emission reduction started in the early years and if low-carbon technology was fully available, the likely probability was that warming in the twenty-first century would remain below 2 °C and at moderate economic cost. However, a delay in mitigation action and the unavailability of carbon capture and storage (CCS) increased the available temperature targets by about 0.3–0.4 °C. Admiraal et al. (2015) analyzed how the timing of emission reduction affects economic costs and benefits. This study considers the aspects of not only mitigation but also of adaptation and climate damage. They found that the total costs and net benefits are greater in the gradual mitigation pathway compared with the early or delayed mitigation scenarios. Warren et al. (2013) evaluated the impact (physical and economic) of delay in mitigation action using their physical- and economic-based models and found that early, stringent mitigation would avoid a large proportion of the future impacts but not all the impacts were avoided.

These studies suggest that if mitigation action is globally delayed, the costs to achieve the target will be much higher and that the target may even become infeasible. However, other characteristics of emission pathways that achieve a certain temperature target or a cumulative emission, including emission levels at the end of the century, have not yet been analyzed.

In addition, there have been a huge number of studies on climate change mitigation policy and measures on a global scale, particularly focusing on the 2 °C target. Edenhofer et al. (2010) compared the results of five IAMs for success in achieving the 2 °C target, with different probabilities for achieving the target (at 400, 450, and 550 ppm). They found that such a temperature target was technically feasible and economically viable. They also analyzed the effect of low-carbon technologies, such as CCS, biomass, and nuclear power, on achieving the target. Den Elzen et al. (2013) analyzed abatement costs to countries for achieving an ambitious global emission reduction target by 2050 (to 50 % of 1990 emissions) considering different efforts of developed countries. They found that abatement costs would be higher for developing countries when the emission reduction targets of developed countries are smaller (less than an 85 % reduction), whereas the costs would be higher for developed countries when their target is larger (greater than an 85 % reduction). Hof et al. (2013) evaluated the emission gap for achieving the 2 °C target and the probability thereof after updating the emission reduction pledges for 2020 and the business-as-usual scenario in the Cancun Agreement. They showed that although achieving the target is possible with the pledges, high reduction rates would be required after 2020. Kriegler et al. (2013b) focused on the importance of mitigation technologies, such as CCS, nuclear power, and renewable energy in their model comparison study, and found that technologies that realized negative emissions were the most important elements for climate mitigation. Rogelj et al. (2013b) assessed the cost distribution of achieving the target under uncertainties in geopolitical, technological, social, and political factors and found that political factor (delay in mitigation action) had the largest impact on the cost. Alexeeva and Anger (2016) evaluated the economic implications, in terms of welfare and competitiveness, of linking emissions trading schemes including the Clean Development Mechanism with the 2 °C target in mind, using their computable general equilibrium (CGE) model. They suggest that integrating these schemes yields economic welfare improvement. However, while the terms of trade were improved in the countries of European Union, the opposite consequence was seen in the other countries.

Matsumoto et al. (2015) analyzed the socioeconomic impact of mitigating emissions based on an FCE for the twenty-first century, using a CGE model. They systematically developed five emission pathways based on an FCE—all pathways show emissions beginning to decline from the reference level in 2040, to attain zero by 2100. However, because these emission pathways were simple, the number of pathways was small, and only one cumulative emission was analyzed, no in-depth analysis of the relationship between the various aspects of the pathways for cumulative emissions and their socioeconomic impact was implemented.

In climate modeling research, as mentioned above, cumulative CO₂ emissions are an important factor, indicating that a cumulative carbon emission determines the global temperature rise regardless of emission pathways taken. This means that the optimal emission pathway to achieve a global temperature target can be determined from socioeconomic perspectives. The purpose of this study is to understand if the relationship between cumulative emissions and socioeconomic factors holds true as well, in other words, to investigate the path dependence of socioeconomic impacts. To do this, we analyze the socioeconomic impact of various emission pathways under the constraint of FCEs on a global scale, using a CGE model. In particular, we examine their effects on carbon price (or marginal abatement cost), global total gross domestic product (GDP), and energy demands, as a basis for evaluating socioeconomic impacts. First, we examine the temporal features of the impacts to gain an overview of the results. We then further investigate the results of model calculation by using statistical methods. Although specific cumulative CO₂ emissions are required to achieve a global warming target (TCRE), the pathways to achieve this target are variable and the socioeconomic impact can be different according to the selected emission pathway. Carbon pricing increases energy prices, particularly fossil fuels. This increase in prices affects the economic activity of both the industrial sector and consumers. These effects then influence indicators of whole economic activities, such as total energy demand and GDP. Thus, understanding such influences is of global societal interest. In particular, because policymakers are concerned about the socioeconomic impacts of these different policies and emission pathways when implementing climate change measures, this economic information is crucial for policymaking. By analyzing such effects, we provide policymakers with the information required for selecting a suitable emission pathway that meets the future climate stabilization target. If they know that a given emission pathway will have less negative economic impact while reducing fossil fuel consumption, they can adopt policies to achieve that pathway with greater public acceptance. In addition, by comparing three cumulative emission levels, we try to promote a better understanding of the characteristics of cumulative emissions from socioeconomic perspectives. In other words, this study is a good starting point to evaluate the cumulative emissions under various pathways from a socioeconomic perspective.

To achieve the purpose of this study, a CGE model (Section 2.1) is used to analyze a reference scenario and multiple emission reduction pathways for three FCE scenarios (Section 2.3). In analyzing the FCE scenarios, the developed emission pathways are used as constraints when running the model. In addition, statistical methods (Section 2.2) are applied to further analyze the model results.

In achieving the emission pathways in the three scenarios, the model assumes that emissions are reduced cost effectively through emissions trading on a global scale, as described in Section 2.1. Among the various socioeconomic factors that can be analyzed using the CGE model (e.g., GDP, welfare, consumption, trade, investment, and energy supply and demand), this study focuses on carbon price, GDP, and energy demand on a global scale because they are suitable indicators for observing the socioeconomic impacts linked to reducing emissions and are often used in this type of research (e.g., Clarke et al. 2009; Masui et al. 2011; Matsumoto et al. 2016; Thomson et al. 2011). Section 3.1 shows the overall features of the results of the model calculations. Section 3.2 then shows the detailed analysis of path dependence of the results. Here, we focus on the global-scale results. However, some regional-scale results are provided in Appendix 1.

Because TCRE was nearly constant, future temperature increase is strongly correlated with cumulative CO₂ emission levels, regardless of the emission pathway. Hence, to determine the target emission pathway for a given climate stabilization target, for example, an acceptable temperature rise, we require an understanding of how dependent the global economy is on the emission pathway. In this study, we analyzed socioeconomic impacts of various emission pathways for three cumulative CO₂ emissions, corresponding to the emissions required to meet the 2 °C target, emissions 10 % higher than 2 °C target emissions, and emissions producing radiative forcing of 4.5 W/m² in 2100, using a CGE model. We also applied statistical methods to further analyze the features of the pathways. Global socioeconomic impacts would be different depending on the emission pathway selected even if the cumulative emissions were the same. The key global-scale findings of this study are as follows:

As shown in this study, emission reduction will negatively affect the global economy compared with the level of the reference scenario. However, pathways with earlier emission reduction (i.e., earlier emission peak) followed by a moderate rate of reduction achieving lower emission levels will minimize the economic impact in this century. Furthermore, in our model setting, 2020 is a desirable point for peak emissions to reduce mitigation cost, and emissions must peak by 2030 at the latest to meet the 2 °C target. Although the Paris Agreement was adopted at the 21st Conference of the Parties to the United Nations Framework Convention on Climate Change, the Intended Nationally Determined Contributions in the agreement are insufficient to achieve the early emission peak in the global level (Climate Action Tracker 2015). Thus, global talks to promote action (at the national and global level) to realize greater emission reductions and an earlier emission peak (e.g., emissions trading, carbon tax, and technological development and dissemination) are urgent for minimizing long-term economic impacts. However, our study results show that rapid emission reduction is unlikely to be necessary, while a moderate emission reduction pathway achieving lower (negative) emissions by the end of the century is better from an economic perspective. Moderate emission reduction would allow society to adapt more easily to the new low-carbon economy. For example, primary energy demand, which is a driver of economic activities, will not be greatly affected by moderate emission reduction. Renewable energy, meanwhile, is an indispensable but expensive technology for realizing a low-carbon society that can be introduced gradually. Furthermore, during the moderate reduction phase, society will have time to develop new low-carbon technology and to develop strategy for the eventual zero or negative emission world.