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This article provides an analysis of the EU Emissions Trading Scheme (ETS) and the harmonized benchmark-based allocation procedures by comparing two energy-intensive sectors with activities in three Member States. These sectors in...
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This article provides an analysis of the EU Emissions Trading Scheme (ETS) and the harmonized benchmark-based allocation procedures by comparing two energy-intensive sectors with activities in three Member States. These sectors include the cement industry (CEI) and the pulp and paper industry (PPI) in the UK, Sweden, and France. Our results show that the new procedures are better suited for the more homogeneous CEI, in which the outcome of stricter allocation of emissions allowances is consistent between Member States. For the more heterogeneous PPI - in terms of its product portfolios, technical infrastructures, and fuel mixes - the allocation procedures lead to diverse outcomes. It is the lack of product benchmark curves, and the alternative use of benchmark values that are biased towards a fossil fuel-mix and are based on specific energy use rather than emission intensity, which leads to allocations to the PPI that do not represent the average performance of the top 10% of GHG-efficient installations. Another matter is that grandfathering is still present via the historically based production volumes. How to deal with structural change and provisions regarding capacity reductions and partial cessation is an issue that is highly relevant for the PPI but less so for the CEI.
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摘要 :
This article provides an analysis of the EU Emissions Trading Scheme (ETS) and the harmonized benchmark-based allocation procedures by comparing two energy-intensive sectors with activities in three Member States. These sectors in...
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This article provides an analysis of the EU Emissions Trading Scheme (ETS) and the harmonized benchmark-based allocation procedures by comparing two energy-intensive sectors with activities in three Member States. These sectors include the cement industry (CEI) and the pulp and paper industry (PPI) in the UK, Sweden, and France. Our results show that the new procedures are better suited for the more homogeneous CEI, in which the outcome of stricter allocation of emissions allowances is consistent between Member States. For the more heterogeneous PPI - in terms of its product portfolios, technical infrastructures, and fuel mixes - the allocation procedures lead to diverse outcomes. It is the lack of product benchmark curves, and the alternative use of benchmark values that are biased towards a fossil fuel-mix and are based on specific energy use rather than emission intensity, which leads to allocations to the PPI that do not represent the average performance of the top 10% of GHG-efficient installations. Another matter is that grandfathering is still present via the historically based production volumes. How to deal with structural change and provisions regarding capacity reductions and partial cessation is an issue that is highly relevant for the PPI but less so for the CEI.
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The paper aims to identify and analyse potential legal avenues for phasing out fossil fuel subsidies (FFS) in the European Union (EU) using State aid rules. Our analysis reveals that the EU State aid rules would allow the European...
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The paper aims to identify and analyse potential legal avenues for phasing out fossil fuel subsidies (FFS) in the European Union (EU) using State aid rules. Our analysis reveals that the EU State aid rules would allow the European Commission to effectively target and monitor a vast number of FFS. From a policy perspective, the requirements for notification, examination, transparency, reporting, and recovery of unlawfully granted aid are of particular importance. The legal framework also provides avenues for the EU Commission to start a 'Fossil Fuel Inquiry', while providing important tools for civil society to apply pressure on states for the removal of FFS. Based on our legal analysis and pertinent literature, we discuss which of these different FFS and corresponding estimates are likely (or not) to fall under the EU State aid rules. Despite inherent uncertainties, the EU State aid toolbox offers various possibilities to the EU to actively advance its climate change policy and comply with its international commitments to reduce FFS. Key policy insights Member States in the EU still subsidize both the consumption and production of fossil fuels by a myriad of different measures, despite pledges to reduce FFS as part of the EU's ambitious climate policy. A major part of these fossil fuels subsidies could be addressed by the already existing EU State aid rules, which provide an effective system that is not dependent on Member States political will and has a powerful enforcement mechanism. A first key step would be for the EU Commission to start a 'Fossil Fuel Inquiry', which would identify and quantify all support for fossil fuels within Member States. The EU State aid rules could also provide civil society with the possibility to actively lobby for State aid control, while offering the court systems in Member States as an additional avenue for enforcement.With this in mind, the EU State Aid rules could be used effectively to help the EU to phase out a major part of FFS.
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End-use efficiency, demand response and coupling of different energy vectors are important aspects of future renewable energy systems. Growth in the number of data centres is leading to an increase in electricity demand and the em...
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End-use efficiency, demand response and coupling of different energy vectors are important aspects of future renewable energy systems. Growth in the number of data centres is leading to an increase in electricity demand and the emergence of a new electricity-intensive industry. Studies on data centres and energy use have so far focused mainly on energy efficiency. This paper contributes with an assessment of the potential for energy system integration of data centres via demand response and waste heat utilization, and with a review of EU policies relevant to this. Waste heat utilization is mainly an option for data centres that are close to district heating systems. Flexible electricity demand can be achieved through temporal and spatial scheduling of data centre operations. This could provide more than 10 GW of demand response in the European electricity system in 2030. Most data centres also have auxiliary power systems employing batteries and stand-by diesel generators, which could potentially be used in power system balancing. These potentials have received little attention so far and have not yet been considered in policies concerning energy or data centres. Policies are needed to capture the potential societal benefits of energy system integration of data centres. In the EU, such policies are in their nascent phase and mainly focused on energy efficiency through the voluntary Code of Conduct and criteria under the EU Ecodesign Directive. Some research and development in the field of energy efficiency and integration is also supported through the EU Horizon 2020 programme. Our analysis shows that there is considerable potential for demand response and energy system integration. This motivates greater efforts in developing future policies, policy coordination, and changes in regulation, taxation and electricity market design.
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If we are to limit global warming to 2 degrees C, all sectors in all countries must reduce their emissions of GHGs to zero not later than 2060-2080. Zero-emission options have been less explored and are less developed in the energ...
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If we are to limit global warming to 2 degrees C, all sectors in all countries must reduce their emissions of GHGs to zero not later than 2060-2080. Zero-emission options have been less explored and are less developed in the energy-intensive basic materials industries than in other sectors. Current climate policies have not yet motivated major efforts to decarbonize this sector, and it has been largely protected from climate policy due to the perceived risks of carbon leakage and a focus on short-term reduction targets to 2020. We argue that the future global climate policy regime must develop along three interlinked and strategic lines to facilitate a deep decarbonization of energy-intensive industries. First, the principle of common but differentiated responsibility must be reinterpreted to allow for a dialogue on fairness and the right to development in relation to industry. Second, a greater focus on the development, deployment and transfer of technology in this sector is called for. Third, the potential conflicts between current free trade regimes and motivated industrial policies for deep decarbonization must be resolved. One way forward is to revisit the idea of sectoral approaches with a broader scope, including not only emission reductions, but recognizing the full complexity of low-carbon transitions in energy-intensive industries. A new approach could engage industrial stakeholders, support technology research, development and demonstration and facilitate deployment through reducing the risk for investors. The Paris Agreement allows the idea of sectoral approaches to be revisited in the interests of reaching our common climate goals.Policy relevanceDeep decarbonization of energy-intensive industries will be necessary to meet the 2 degrees C target. This requires major innovation efforts over a long period. Energy-intensive industries face unique challenges from both innovation and technical perspectives due to the large scale of facilities, the character of their global markets and the potentially high mitigation costs. This article addresses these challenges and discusses ways in which the global climate policy framework should be developed after the Paris Agreement to better support transformative change in the energy-intensive industries.
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In the attempt to reduce greenhouse gas emissions from steel production, several large industry decarbonization projects have emerged in Europe. The commercialization of low-emission steel technology, however, faces systemic barri...
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In the attempt to reduce greenhouse gas emissions from steel production, several large industry decarbonization projects have emerged in Europe. The commercialization of low-emission steel technology, however, faces systemic barriers such as a lack of infrastructure and unclear demand for greener steel. As part of its new commitment to climate-neutrality, the European Commission has announced plans to more actively create and reshape markets for green basic materials. The approach is inspired by the recent success story of renewable energy, where market interventionist policy has successfully led to cost reductions and supported the diffusion of wind and photovoltaics. However, the applicability of this type of policy to decarbonize basic materials has so far not been investigated. In this study, we evaluate the effectiveness, feasibility, efficiency and fairness of early commercialization policy support for the decarbonization transition of steel. We compare two approaches: demand side market creation and direct production subsidies through carbon contracts for difference. We find that the subsidy approach can more effectively enable the realization of primary green steel production. A complementary use of market creation policy instruments can reduce the production subsidy volumes needed and aid the global diffusion of new production methods. Although effective, we find that production subsidies will distribute the costs and benefits of the transition unequally. In order to improve effectiveness and fairness of the policy, parallel programmes such as electricity price guarantees and transitional assistance policies for disadvantaged regions are needed. Key policy insights Carbon contracts for difference are the most promising policy instrument to commercialize low-emission primary steel but are likely to lead to unequal distribution of transition costs. Market creation policies can support the global diffusion of low-emission primary steelmaking. Material efficiency and demand reduction can reduce the need for primary steel production by more than 50%. Regions without access to large amounts of renewable electricity are especially disadvantaged. Unclear EU ETS benchmarks currently create a perverse incentive that keeps firms from investing in breakthrough technologies.
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The production of commodities by energy-intensive industry is responsible for 1/3 of annual global greenhouse gas (GHG) emissions. The climate goal of the Paris Agreement, to hold the increase in the global average temperature to ...
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The production of commodities by energy-intensive industry is responsible for 1/3 of annual global greenhouse gas (GHG) emissions. The climate goal of the Paris Agreement, to hold the increase in the global average temperature to well below 2 degrees C above pre-industrial levels while pursuing efforts to limit the temperature increase to 1.5 degrees C, requires global GHG emissions reach net-zero and probably negative by 2055-2080. Given the average economic lifetime of industrial facilities is 20 years or more, this indicates all new investment must be net-zero emitting by 2035-2060 or be compensated by negative emissions to guarantee GHG-neutrality. We argue, based on a sample portfolio of emerging and near commercial technologies for each sector (largely based on zero carbon electricity & heat sources, biomass and carbon capture, and catalogued in an accompanying database), that reducing energy intensive industrial GHG emissions to Paris Agreement compatible levels may not only be technically possible, but can be achieved with sufficient prioritization and policy effort. We then review policy options to drive innovation and investment in these technologies. From this we synthesize a preliminary integrated strategy for a managed transition with minimum stranded assets, unemployment, and social trauma that recognizes the competitive and globally traded nature of commodity production. The strategy includes: an initial policy commitment followed by a national and sectoral stakeholder driven pathway process to build commitment and identify opportunities based on local zero carbon resources; penetration of near-commercial technologies through increasing valuation of GHG material intensity through GHG pricing or tradable performance based regulations with protection for competitiveness and against carbon leakage; research and demand support for the output of pilot plants, including some combination of guaranteed above-market prices that decline with output and an increasing requirement for low carbon Inputs in government procurement; and finally, key supporting institutions. (C) 2018 Elsevier Ltd. All rights reserved.
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The target of zero emissions sets a new standard for industry and industrial policy. Industrial policy in the twenty-first century must aim to achieve zero emissions in the energy and emissions intensive industries. Sectors such a...
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The target of zero emissions sets a new standard for industry and industrial policy. Industrial policy in the twenty-first century must aim to achieve zero emissions in the energy and emissions intensive industries. Sectors such as steel, cement, and chemicals have so far largely been sheltered from the effects of climate policy. A major shift is needed, from contemporary industrial policy that mainly protects industry to policy strategies that transform the industry. For this purpose, we draw on a wide range of literatures including engineering, economics, policy, governance, and innovation studies to propose a comprehensive industrial policy framework. The policy framework relies on six pillars: directionality, knowledge creation and innovation, creating and reshaping markets, building capacity for governance and change, international coherence, and sensitivity to socio-economic implications of phase-outs. Complementary solutions relying on technological, organizational, and behavioural change must be pursued in parallel and throughout whole value chains. Current policy is limited to supporting mainly some options, e.g. energy efficiency and recycling, with some regions also adopting carbon pricing, although most often exempting the energy and emissions intensive industries. An extended range of options, such as demand management, materials efficiency, and electrification, must also be pursued to reach zero emissions. New policy research and evaluation approaches are needed to support and assess progress as these industries have hitherto largely been overlooked in domestic climate policy as well as international negotiations. Key policy insights Energy and emission intensive industries can no longer be complacent about the necessity of zero greenhouse gas (GHG) emissions. Zero emissions require profound technology and organizational changes across whole material value chains, from primary production to reduced demand, recycling and end-of-life of metals, cement, plastics, and other materials. New climate and industrial policies are necessary to transform basic materials industries, which are so far relatively sheltered from climate mitigation. It is important to complement technology R&D with the reshaping of markets and strengthened governance capacities in this emerging policy domain. Industrial transformation can be expected to take centre stage in future international climate policy and negotiations.
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The Swedish steel industry stands before a potential transition to drastically lower its CO2 emissions using direct hydrogen reduction instead of continuing with coke-based blast furnaces. Previous studies have identified hydrogen...
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The Swedish steel industry stands before a potential transition to drastically lower its CO2 emissions using direct hydrogen reduction instead of continuing with coke-based blast furnaces. Previous studies have identified hydrogen direct reduction as a promising option. We build upon earlier efforts by performing a technological innovation system study to systematically examine the barriers to a transition to hydrogen direct reduction and by providing deepened quantitative empirics to support the analysis. We also add extended paper and patent analysis methodology which is particularly useful for identifying actors and their interactions in a technological system. We conclude that while the innovation system is currently focused on such a transition, notable barriers remain, particularly in coordination of the surrounding technical infrastructure and the issue of maintaining legitimacy for such a transition in the likely event that policies to address cost pressures will be required to support this development. (C) 2019 The Authors. Published by Elsevier Ltd.
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Global steel production is currently dependent on coal and capital-intensive production facilities with long economic lifetimes. While the Paris Agreement means carbon neutrality must be reached globally by 2050-2070, with negativ...
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Global steel production is currently dependent on coal and capital-intensive production facilities with long economic lifetimes. While the Paris Agreement means carbon neutrality must be reached globally by 2050-2070, with negative emissions thereafter, coal-based steel production today accounts for around 8% of global energy related CO2 emissions. Its production may stabilize or even decline in industrialized countries, but it will increase significantly in the emerging economies. In the past, the focus of CO2 reduction for steel has been on moderate emissions reductions through energy efficiency measures and on exploring carbon capture and storage. However, as (1) the cost of renewable electricity is declining rapidly, (2) carbon capture and storage has not materialized yet, and (3) and more and more countries set deep emission reduction targets, electricity- and hydrogen-based steel making has gathered substantial momentum over the past half-decade. Given the short time frame and the sector's deep carbon lock-in, there is an urgent need to understand the national climate and energy policy as well as the current implementation of low-CO2 and renewable electricity that would enable a shift from coal-based to electricity-based steel making. In this paper, we first identify the countries that are likely to be major steel producers in the future and thus major CO2-emitters. Then we map medium- and long-term CO2 reduction and renewable targets as well as the current share of low-CO2 and renewable electricity by country. Based on these data, we develop a set of indicators that map the readiness of steel-producing countries for a sustainable transition. Our findings show that although binding long-term CO2 reduction targets are being implemented, medium-term CO2 reduction do not yet affect coal based steel production. Overall, the global steel industry seems not be on track yet, though differences between steel producing countries are large. Common shortcomings across countries are a lack of access to renewable electricity and a lack of demanding medium-term CO2 reduction targets. The paper ends with recommendations on how to enable a low-carbon transition of the global steel industry in line with the Paris Agreement.
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