How CO2-to-Diesel Technology Could Help Reach Net-Zero Emissions Targets: A Canadian Case Study

Carbon capture, utilization, and storage (CCUS) is an attractive technology for the decarbonization of global energy systems. However, its early development stage makes impact assessment difficult. Moreover, rising popularity in carbon pricing necessitates the development of a methodology for deriving carbon abatement costs that are harmonized with the price of carbon. We develop, using a combined bottom-up analysis and top-down learning curve approach, a levelized cost of carbon abatement (LCCA) model for assessing the true cost of emissions mitigation in CCUS technology under carbon pricing mechanisms. We demonstrate our methodology by adapting three policy scenarios in Canada to explore how the implementation of CO2-to-diesel technologies could economically decarbonize Canada’s transportation sector. With continued policy development, Canada can avoid 932 MtCO2eq by 2075 at an LCCA of CA$209/tCO2eq. Technological learning, low emission hydroelectricity generation, and cost-effective electricity prices make Quebec and Manitoba uniquely positioned to support CO2-to-diesel technology. The additional policy supports beyond 2030, including an escalating carbon price, CO2-derived fuel blending requirements, or investment in low-cost renewable electricity, which can accelerate market diffusion of CO2-to-diesel technology in Canada. This methodology is applicable to different jurisdictions and disruptive technologies, providing ample foci for future work to leverage this combined technology learning + LCCA approach.

Uncovering Cleaner Method for Underground Metal Mining: Enterprise-Level Assessment for Current and Future Energy Consumption and Carbon Emission from Life-Cycle Perspective

China has committed to peak its carbon emissions by 2030, which puts forward a new issue for underground metal mines—selecting a cleaner mining method which requires less energy and generates less carbon emissions. This paper proposes an enterprise-level model to estimate life-cycle energy consumption and carbon emissions, which takes more carbon sources (e.g., cement and carbon sink loss) into consideration to provide more comprehensive insights. Moreover, this model is integrated with the energy-conservation supply curve and the carbon abatement cost curve to involve production capacity utilization in the prediction of future performance. These two approaches are applied to 30 underground iron mines. The results show that (1) caving-based cases have lower energy consumption and carbon emissions, i.e., 673.64 GJ/kt ore, 52.21 GJ/kt ore (only considering electricity and fossil fuel), and 12.11 CO2 eq/kt ore, as compared the backfilling-based cases, i.e., 710.08 GJ/kt ore, 63.70 GJ/kt ore, and 40.50 t CO2 eq/kt ore; (2) caving-based cases present higher carbon-abatement potential (more than 12.95%) than the backfilling-based vases (less than 9.68%); (3) improving capacity utilization facilitates unit cost reduction to mitigate energy consumption and carbon emissions, and the energy-conservation and carbon-abatement potentials will be developed accordingly.

Cost And Welfare: A Simulation of Establishing A Unified Carbon Market In China

BackgroundGlobal warming has aroused wide concern of international community, which has reached a consensus on the carbon abatement. In 2017, China should have established a unified market for carbon emission trading, while the government has postponed the establishment because the uncertainty of cost calculation and welfare. Therefore, the cost and welfare of carbon abatement in simulated scenarios could help the government in establishing a unified carbon market and setting suitable policy. In the national carbon trading market, the variations of different abatement cost are the precondition of carbon exchange. This paper set forth theories related to carbon market and used parametric directional distance function model to derive the shadow prices of 30 provinces from 2011 to 2017. Then the classic logarithmic model is used to simulate marginal abatement cost curves, which is further applied to empirically investigate the welfare of 30 provinces in two scenarios of carbon trading market in China. ResultsThe results indicate that marginal abatement cost would rise with the increasing of emission reduction and vary significantly among provinces, and undeveloped provinces have greater potential in emission reduction than developed regions. Moreover, all provinces could benefit from the establishment of the nationwide ETS.ConclusionsThis article combines the theoretical model of shadow prices with the analysis of China’s carbon trading market in an attempt to analyze the cost and welfare of Chinese provinces and cities on the unified carbon trading market, adding the time trend factor to the directional distance function, and then further combines the parameter method to estimate the shadow price of CO2. Finally, the paper gives some proposals regarding to China’s ETS and carbon reduction targets.

Opportunity Cost of Environmental Regulation in China’s Industrial Sector

In this paper, we employ a directional distance function to estimate the opportunity cost arising from environmental regulations in China’s industrial sector. The change of opportunity cost is decomposed mathematically into two components including technical change and input change. Our results show that the opportunity cost attributed to environmental regulation is nil in some regions. The change of opportunity cost is marginal at the national level, as the positive effect of technical change is canceled out by the negative impact of input change on opportunity cost. Built on our mathematical decomposition, we further estimate the effects of environmental regulations on opportunity cost using a mediation model. It shows that environmental regulation has a significantly positive direct effect and a significantly negative indirect effect through foreign direct investment on opportunity cost. Our findings suggest, firstly, that inward FDI in China’s industrial sector represents relatively dirty production technology; and, secondly, industrial production has transited towards a less carbon-intensive input mix. This paper, therefore, provides new insights for the recent dynamics of carbon abatement performance of China’s industrial sector with policy implications.