AIM/CGE for global and country analysis

Toshihiko Masui, Azusa Okagawa, Kenichi Matsumoto, Shinichiro Fujimori, and Hancheng Dai(National Institute for Environmental Studies)

The 16th AIM WorkshopNational Institute for Environmental Studies, Tsukuba, Japan

19 February 2011

Impact/Adaptation Model

Emission Model

Overall of AIM

【Country】

【Global】

【Enduse model】

【Economic model】

【Account model】

【sequentialdynamics】

【dynamicoptimization】

【Local/City】

Agriculture

Water

Human health

Simple Climate Model

Other Models

future society

Population Transportation Residential

GHGemissions

temperature 

【Global】 【National/Local】

feedback

AIM/Impact[Policy]

Burden share Stock‐flow

mid‐term target

IPCC/WG3

IPCC/WG2

IPCC/integrated scenario

carbon tax

long‐term vision

Accounting

2adaptation

low carbon scenario

CGE models development and their application

• Global model– Long‐term emission 

scenarios: RCP and SSP– AME and EMF– Contribution to other 

analyses such as LCS study (S‐6; Env. research fund, MoE)

• Country model– Mid‐long term GHG

emission reduction target in Japan

– Application to China

• New model development‒ Global model: more detailed sectors and regions‒ Country model: training workshop toward LCS study

Main purposes of CGE models‒ Consistency check of scenarios‒ Quantification of economic impacts of GHG mitigation policies 

3

Global Model

4

Features of present AIM/CGE [Global]

• Global general equilibrium model with recursive dynamics. • Benchmark data of the economic activity is GTAP6 (the year 

2001). IEA energy balance table is introduced for energy– Numbers of region: 24– Types of commodity: 21– Treated Gas: CO2, CH4, N2O, SOx, NOx, CO, NMVOC, BC, OC, 

NH3• Production factor: capital, labor, resource and land• Future scenarios

– technology change (TFP, AEEI, material inputs, …)– consumption pattern change

• Designed to link with the global technology selection (endusetype) model and country CGE model

5

Region and commodity in AIM/CGE [Global]

JapanChinaKoreaIndonesiaIndiaThailandOther South‐east AsiaOther South AsiaAustraliaNew ZealandRest of Asia‐PacificCanadaUSAEU‐15 in Western EuropeEU‐10 in Eastern EuropeRussiaRest of EuropeBrazilMexicoArgentineOther Latin AmericaMiddle EastSouth AfricaOther Africa

AgricultureLivestockForestryFishingMining (except fossil fuels)Energy intensive productsMetal and machineryFoodsOther manufacturesWaterConstructionTransportCommunicationPublic serviceOther serviceCoalCrude oilPetroleum productsNatural gasGas manufacture distributionElectricity

Coal fire*, Oil products fire*, Gas fire*, Nuclear, Hydro, Biomass*, Waste, Geothermal, Solar, Wind, and Other renewables*: with/without CCS 6

RCP and SSP toward IPCC/AR5

• RCP: Representative Concentration Pathways– Inputs to climate models: Concentrations of GHGs, land use change, ...– Following model teams are contributing;

• 2.6W/m2 IMAGE• 4.5W/m2 MiniCAM• 6.0W/m2 AIM• 8.5W/m2 MESSAGE

– NIES (climate modeling team), JAMSTEC and Ibaraki Univ. support AIM team. 

– Emission forecasts and historical data for RCP:  http://www.iiasa.ac.at/web‐apps/tnt/RcpDb

• SSP: Shared Socio‐economic Pathways– Inputs to impact models: Socio‐economic activities– Different future directions: Adaptive Capacity and Mitigation Capacity

RCP

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Results on RCP

Total CO2 emissions by scenarios

Electricity in 6W/m2 Electricity in reference

RCP

8

Asian Modeling Exercise

• Model comparison project

• Final goals1. Asian scenarios toward low carbon 

society (‐2100)• Policy options and their costs in Asia

2. Input outcomes to AR5

• Schedule– 1st meeting in Tsukuba, Sep 2009– 2nd meeting in Beijing, Mar 2010– 3rd meeting in Seoul, Sep 2010– Final data submission, Jan 2011– The 4th meeting in Xian, Mar 2011– Paper deadline:  June 1st 2011

AIM/Enduse [Global]Bottom‐up model

AIM/CGE [Global]Top‐down model

Technology information(Energy Efficiency Improvement)

AME

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Results from AIM/CGE [Global]

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China (BAU)China (550ppm)China (450ppm)Japan (BAU)Japan (550ppm)Japan (450ppm)India (BAU)India (550ppm)India (450ppm)

Total CO2 emission(Mt CO2)

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TPES/GDP(EJ/billion US$)

CO2/GDP(Mt CO2/billion US$)

World carbon price(US$2005/t CO2)

AME

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Preliminary results for EMF24 (1st round)

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Scenario 1 Base Scenario 2 Base

Scenario 3 Base Scenario 4 Base

Scenario 5 450 CO2e Scenario 6 550 CO2e

Scenario 7 550 CO2e Scenario 8 550 CO2e

Scenario 9 550 CO2e Scenario 10 Idealized G8

Scenario 13 Muddling through Scenario 14 Muddling through

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Scenario 3 Base Scenario 4 Base

Scenario 5 450 CO2e Scenario 6 550 CO2e

Scenario 7 550 CO2e Scenario 8 550 CO2e

Scenario 9 550 CO2e Scenario 10 Idealized G8

Scenario 13 Muddling through Scenario 14 Muddling through

Global GDP Global CO2 emissions

EMF24

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2 approaches toward Low Carbon Society

Low Carbon Society

Backcastingto estimate roadmap

Top‐down approach: global model analysisGHG emissions from Asia region corresponding to global target

Bottom‐up approach: country/local scenario developmentQuantification of activity in the future achieving country/local GHGemission reduction target

How to bridge“GAP”?

LCS

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Asia in scenario of global GHG emission reduction by half

CO2 emissions (bil. tCO2) Primary energy supply (EJ)

Renewable energy supply (EJ)

Japan ChinaKorea IndonesiaThailand Other Sounth & East AsiaIndia Other Sounth AsiaOther Asia Rest of the WorldReference (global) Reference (Asia)

LCS

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Country Model

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▲15%▲19%▲25%

1,261 1,344 1,355 1,282 1,3741,257 1,076 1,018 949

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技術

固定

参照

▲15

%

▲20

%

▲25

%

Linkage between AIM/Enduse[Japan] and AIM/CGE[Japan]

This information estimated from AIM/Enduse [Japan] is input into AIM/CGE [Japan].

Additional investment to reduce GHG emissions

2011-2020▲15% ▲20% ▲25%

industry Energy intensive industries 1.8 1.8 1.8Industrial furnace, boiler, etc 1.2 1.2 1.4

3.0 3.0 3.3residential High insulation house 10.1 15.3 19.9

High efficient & solar water heater 6.1 7.9 9.6High efficient appliances & HEMS 4.8 7.9 11.3

21.1 31.1 40.8Commercial Energy efficient building 3.6 5.8 6.1

High efficient & solar water heater 0.4 1.1 1.5High efficient appliances 2.0 2.7 3.6

6.0 9.7 11.2Transportation Next generation vehicles 7.0 7.9 8.7

Low fuel consumption 0.8 0.8 0.87.8 8.7 9.5

energy PV 11.0 13.0 15.2Wind power 2.8 2.8 2.8Small scale hydro & geo-thermal 1.7 3.2 5.3Biomass power 1.0 1.0 1.0power system stabilization 2.3 3.6 5.1Gas pipelines 0.3 0.3 0.4CCS 0.0 0.0 0.1

19.0 23.8 29.9Non-CO2 Agriculture 0.1 0.1 0.1

Waste 0.3 0.3 0.3F-gas 0.6 1.4 1.8

1.0 1.8 2.1Total from 2011 to 2020 58.2 78.3 96.8Annual average 5.8 7.8 9.7unit : trillion yen

(as of 21 December 2010)

GHG emissions (MtCO2eq)

Non-energyEnergyTransportationCommercialResidentialIndustry

Fixed techno

logy

Reference

Year 2020

Japan

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GDP and carbon price from AIM/CGE [Japan](as of 21 December 2010)

2020reference ▲15% ▲20% ▲25%

GDP growth rate(2010‐2020；%/year) 2.07% 1.96% 1.89% 1.77%

GDP change from reference in 2020 (%) ‐1.11% ‐1.78% ‐2.94%

CO2 price(yen at 2000 price/tCO2) 14,643 21,198 41,446

Japan

Within 10 years, GDP growth rate will slow down, but new industries related energy saving equipment and renewable energy will be activated.

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China Dynamic CGE Model Features 

Model: Recursive dynamic CGE model, 41 sectorsTime period: 2005‐2050, 5 year stepGas: Energy related CO2, Process CO2, other GHGsTechnology: 

• 12 power generation technologies 7 fossil and 5 non‐fossil

• CCS technology in: Coal and gas fired electricity sectors, sectors of cement, chemistry, iron and steel.

China

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il. Yuan

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Carbon Price

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COL OIL NGS HYD

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Power generation in RS

COL OIL GAS COLc GASc

HYD NUC WND BIO SOL

China Dynamic CGE Model: Preliminary ResultsChina

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New model development

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Main features of a new Global CGE modelNew model Present model

Region 35 (Asian countries; 14) 24 (Asian countries; 8)Industry 38 (manufacture sector is 

disaggregated in detail)20

Emissions CO2, CH4, N2O, NH3, SOx, NOx, BC, OC

Institution Household, government, Enterprise

Representative household

Dynamics Recursive dynamic(1 year step)

Recursive dynamic (10 year step)

Base year 2005 2001

Base data Original energy balance and SAM (data reconciliation system)

GTAP and IEA energy balances

Program GAMS / MCP  GAMS / MPSGE

Global

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Preliminary results of global CGE model

Global GHG emissionsGlobal GDP

Global power structure (450ppm‐delay scenario) GHG emission price

0500100015002000250030003500400045005000

2005

 US$/t CO2 eq

ChinaKoreaUSAIndiaIndonesiaMalaysiaJapanSingaporeThailandVietnamPhilipineRest of South AsiaRest of South east Asia

020406080100120140160180

Tril US$/ y

ear

BaU550ppm450ppm450ppm‐delay

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Global

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Country CGE model and example of the results‐a case of Japan‐

• Most of the features are same as global model.• Each national characteristic (eg renewable energy potential) 

should be considered.• National governmental target and plan will be implemented 

in the scenario.

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Training workshop on Country CGE model

• We will have a training workshop for development of country LCS scenario by using a CGE model. – Date; June 1 or 2 weeks (Tentative)– Location; NIES @ Tsukuba

• Required abilities to attend this training workshop– Basic knowledge about microeconomics, input‐output 

analysis and GAMS– Experience to publish a peer‐reviewed scientific paper– Enthusiasm to show the economic aspects of LCS

Country

23