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Technologies, Policies and Measures for Mitigating Climate Change

buildings sector. This discussion focuses on four general policy Manufacturer incentive programmes in which a competiareas: (1) market-based programmes in which customers or tion is beld and a substantial reward provided for the devet manufacturers are provided technical support and/or incentives; opment/commercialization of a high-efficiency product (ü) mandatory energy efficiency standards, applied at the point of (e.g., the U.S. Super Efficient Refrigerator Program manufacture or at the time of construction; (ui) voluntary energy- (SERP)] (SAR II, 22.5.1.1). efficiency standards; and (iv) increased emphasis of private or • Utility demand-side management (DSM) programmes in public research, development and demonstration programmes for which incentives are provided to customers for the purthe development of more efficient products. Information and chase of energy-efficient products (SAR II, 22.5.1.4). training programmes are a necessary prerequisite for most of • Creation of energy service companies, often encouraged these measures, but it is difficult to directly estimate savings by government and utility programmes, that pay the full attributable to such programmes (SAR II, 22.5.1.6). Direct cost of energy efficient products in exchange for a portion government subsidies and loans will not be covered as a separate of future energy cost savings (SAR II, 22.5.1.4). policy category but rather treated in the context of other measures as a means to reduce private investment costs.

Market-based programmes can be used in place of, or in addi

tion to, standards. In combination with standards, marketThe measures discussed herein often work best in combination. based programmes can be designed to induce the acceptance Mutually reinforcing regulatory, information, incentive and of new and innovative technologies in the marketplace in other programmes offer the best means for achieving significant advance of wben they would otherwise be adopted. When portions of the cost-effective energy-efficiency potential (SAR combined with active, ongoing RD&D programmes, such II, 22.5.1.8). Demand-side projects can be "bundled“ in order to efforts are likely to have significant long-term impacts on the provide a larger energy "resource" and attract capital, especially availability and performance of advanced, more efficient techin pon-Annex I countries (SAR II, 22.5.1.7). Measures need to nologies. For appliances, lighting and office equipment, such be carefully tailored to address specific issues and barriers programmes can influence a very large number of purchasers, associated with various building characteristics, including com- many of whom have little knowledge of ar interest in the energy mercial versus residential buildings, new construction versus efficiency of the product. Combining market-based pro existing retrofits, and owner- versus repter-occupied buildings grammes and mandatory standards can belp overcome some (SAR II. 22.5.1).

of the difficulties of imposing standards, and could bave an

impact greater than standards alone. For all of the measures, environmental benefits associated with the use of more energy efficient equipment and buildings include Importantly, market-based programmes can be directed toward reduction of other power plant emissions (especially sulfur building systems (as opposed to individual pieces of equip oxides, nitrogen oxides and particulates), reduced impacts on meat) to reduce energy coosumption resulting from inadequate land and water resulting from coal mining, reduction of air toxics design, installation, maintenance and operation of heating and from fossil fuel combustion, and the whole range of environmen- cooling systems. There are numerous examples of systems tal benefits resulting from roduced extraction, transport and trans- problems, such as mismatches between air-bandling systems mission, conversion and use of energy (Levine et al., 1994). and chillers, absence or inadequate performance of building

control systems, simultaneous heating and cooling of different

parts of the same building, and so on. 2.3.1 Market-based Programmes

Based on expert judgment, the authors estimate that marketMarket-based programmes, which provide some sort of incen- based programmes will result in global carbon emission tive to promote increased use of energy efficient technologies reductions of about 5% of projected (1892 scenarios) buildand practices, can be divided into the following five types: ings-related emissions by 2010, about 5-10% by 2020 and Technologies, Policies and Measures for Mitigating Climate Change

about 10-20% by 2050 (see section of Table 2 entitled • Government or utility programmes that obtain voluntary "Potential Reductions from Energy-efficient Techoologies

agreements from customers (typically industries or owners Captured through Measures"), after allowing for an estimate operators of large commercial buildings) that they will of the portion of savings that is "taken back” in increased serimplement cost-effective energy-efficiency measures in vices (usage). exchange for technical support and/or marketing assistance (c.8., U.S. Departmeot of Energy and Environmental Surveys of the costs and benefits of these programmes as they Protection Agency programmes such as Green Lights, Motor have been applied in the United States generally indicate that

Challenge and Energy Star Computers) (SAR IL, 22.5.1.6). they are cost-effective (SAR II, 22.5.1.4). However, it is not Procuremens programmes in which very large purchasers possible to generalize, since there have been limited analyses

(typically governments) commission large numbers of and the costs and savings depend both on the specific tech high-efficiency units (SAR II, 22.5.1.1). Examples include Dologies that are promoted and the method of implementation the Swedish NUTEK technology procurement programme of the programme. and the International Energy Agency's Cooperative Procurement of Innovative Technologies.

• Also see Section 9. Economic Instruments.

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The major administrative, institutional and political issues in Project-level costs associated with mandatory standards include implemeating market-based programmes for residential and programme costs for analysis, testing and rating of the products. commercial building equipment follow:

Testing laboratories and equipment to certify the performance

of the appliances will be needed for a country or group of coun• Difficulties in improving integrated systems

tries without such facilities but with a growing demand for • The need for, and shortage of, skilled persons capable of appliances. Other major costs are the investment costs for initial diagnosing and rectifying systems problems

production of the more efficient products, the need for trained • The fact that energy users are often not those responsible personnel and the need for new institutional structures.

for paying energy bills, creating a barrier to increased efficiency (SAR IL, 22.5.1)

Administrative, institutional and political issues associated • The need to structure incentives so that intervention in with implementing mandatory energy-efficiency standards

buildings aims at achieving all cost-effective energy effi- include the following:

ciency measures • The need to create institutional structures for the market- • Opposition from industry for a variety of reasons (perbased programmes to work effectively

ceived loss of profitability, government requirements for • Perception (or reality) of cross subsidies and related increased investments, potential for putting companies out unfairness of expenditures.

of business and reducing competition) • Opposition from other groups that could be adversely

affected (e.g., electric utilities for some standards) 2.3.2 Regulatory Measures

• Difficulty in obtaining agreement among different coun

tries for uniform test procedures and comparable standards, Mandatory energy-efficiency standards—through which the where this proves desirable government enacts specific requirements that all products (or an Difficulty in raising investment money for testing Laborato average of all products) manufactured and buildings constructed ries and for the costs of performing the required tests (espemeet defined energy use criteria are an important regulatory cially acute in non-Annex I countries in spite of the fact option for residential and commercial buildings, such standards that the net benefits are much greater than these costs). have the potential to yield the largest savings in this sector (SAR IL, 22.5.1.2. 22.5.1.3). Appliances typically have lifetimes of Overcoming these difficulties will require substantial effort. 10-20 years (SAR II. 22.4.1.5), while beating and cooling equip Because many appliances are designed, licensed, manufactured ment is replaced over a slightly longer time period. These rapid and sold in different countries with varying energy costs and turnover rates mean that inefficient stock can be relatively consumer use patterns, regional initiatives coupled with rapidly replaced with more efficient stock that meets establisbed financing to set up standards and testing laboratories, especially standards. Residential and commercial buildings, however, more in Annex I countries with economies in transition and nontypically last between 50 and 100 years.

Annex I countries, may be needed to overcome many institu

tional bamiers. Depending on the stringency of the standard levels, the authors estimate (based on expert judgment) that mandatory standards There also are administrative, institutional and political beneapplied to appliances, other energy-using equipment in the build- fits associated with mandatory energy efficiency standards, ing, and the building envelope could result in global carbon emis- including responding to consumer and environmental consion reductions of about 5-10% of projected (1892 scenarios) ceros, reducing future generating capacity requirements, and buildings-related emissions by 2010, about 10-15% by 2020 and providing credibility to manufacturers that take the lead in about 10–30% by 2050 (see section of Table 2 entitled “Potential introducing energy-efficient products through uniform test proReductions from Energy-efficient Technologies Captured cedures. Harmonization of test procedures and standards could through Measures"), after allowing for an estimate of the portion reduce manufacturing costs associated with meeting various of savings that is "taken back” in increased services (usage). requirements.

Mandatory energy efficiency standards are typically set at levels that are cost-effective such that the benefits in terms of 2.3.3 Voluntary Standards energy savings outweigh any additional costs associated with the more efficient product or building. Thus, such standards Voluntary energy efficiency standards, where manufacturers yield reductions in carbon emissions at a net negative cost on and builders agree (without government-mandated legislation) average. Using the impact of U.S. National Appliance Energy to generate products or construct buildings that meet defined and Conservation Act (NAECA) residential appliance stan- energy use criteria, can serve as a precursor or alternative to dards during the period 1990–2015 as an example, the cumu- mandatory standards (SAR II, 22.5.1.2). For products covered Lative det present costs of appliance standards that bave already by these standards, there must be agreement on test procedures, been implemented in the United States are projected to be adequate testing equipment and laboratories to certify equip $32 000 million and the net present savings are estimated to be ment and product labeling-thus satisfying the prerequisites $78 000 million (in USS 1987) (Levine et al., 1994).

of mandatory standards. Voluntary standards have been more 20

Technologies, Policies and Measures for Mitigating Climate Change successful in the commercial sector than in the residential 900-Andex I countries and both Annex I and non-Annex I sector, presumably because commercial customers are more country RD&D specialists (SAR IL, 22.5.1.5). knowledgeable about energy use and efficiency of equipment than residential consumers.

A specific carbon emissions reduction estimate is not assigned

to RD&D in Table 2; rather, it is noted that vigorous RD&D on Boergy use and carbon emissions reductions for voluntary measures to use energy more efficieatly in buildings encomstandards vary greatly, depending upon the way in which they passing improvements in equipment, insulation, windows, exte are carried out and the participation by manufacturers. Based rior surfaces and especially building systems is essential if on expert judgment, the authors estimate that global carbon substantial energy savings are to be achieved in the period after emissions reductions from these standards could range from 2010. It is essential to note that the emissions reductions poten10-50% (or even more if combined with strong incentives) of tials for the residential, commercial and institutional buildings the reductions from mandatory standards.

sector will not be realized without significant RD&D activities.

Project-level costs associated with voluntary standards (costs of testing equipmeat and laboratories, and the initial invest- 24 Global Carbon Emladons Reductions through ment costs) are the same as those for mandatory standards. Technologles and Measures in the Residential, The increased investment for more efficient products, how- Commercial and Institutional Buildings Sector ever, will be lower than that for mandatory standards, as voluptary standards are expected to affect the market less. A range of total achievable emissions reductions for global res3. TRANSPORT SECTOR

ideatial, commercial and institutional buildings is provided in The administrative, institutional and political issues surround- Tables i and 2. These reductions are estimated to be about ing the achievement of voluntary standards are similar to those 10-15% of projected emissions in 2010, 15-20% in 2020 and for mandatory standards but of smaller magnitude, proportion- 20–50% in 2050, based on IS92 scenarios. Thus, total achievate to their ability to affect energy efficiency gaios in appli- able carbon emissions reductions for the buildings sector are ances, other equipment and buildings.

estimated to range (based on 1892 scenarios) from about 0.175-0.45 Gt Clyr by 2010, 0.25-0.70 Gt Clyr by 2020 and

0.35–2.5 G Clyr by 2050. 2.3.4 Research, Development and Demonstration

The measures described can be differentiated based on their RD&D programmes foster the creation of new technologies the potential for carbon emissions reductions, cost-effectiveness enable measures to have impacts over the longer term. In geo- and difficulty of implementation. All of the measures will have eral, only large industries and governments have the resources favorable impacts on an overall economy, to the extent that the and interest to conduct RD&D. The building industry, in con- energy savings are cost-effective. Eovironmental benefits are trast, is highly fragmented, which makes it difficul for the approximately proportional to the reductions in energy industry to pool its resources to conduct RD&D. Goveroment- demand, thus to carbon savings. The administrative and transsupported RD&D has played a key role in developing and action costs of the different measures can vary markedly. commercializing a number of energy-efficient technologies. While building codes and standards can be difficult to adminsuch as low-emissivity windows, electronic ballasts and high- ister, many countries now require some minimum level of efficiency refrigerator compressors. While Annea I RD&D energy efficiency in new construction. Many of the market pro results can often be transferred to non-Annex I countries, there grammes introduce some complexity, but they often can be are conditions specific to these countries that require special designed to obtain savings that are otherwise very difficult to attention, such as building design and construction for bot, capture. The appliance standards programmes are, in principle, bumid climates. For this reason, it is essential to develop a col- the least difficult to administer, but political consensus on these Laborative RD&D infrastructure between researchers based in

programmes can be difficult to achieve.

3.1

Introduction

3.2

Global Carbon Emission Trends and Projections

In 1990, CO2 emissions from transport sector energy use Table 4 shows energy use by different transport modes in 1990, amounted to about 1.25 Gt C-one-fifth of CO, emissions and two possible scenarios of Co, emissions to 2050 (SAR II. from fossil fuel use (SAR II, 21.2.1). Other important GHG 21.2). These two scenarios are used in this section as the basis emissions from the sector include N,O from tailpipe emissions for evaluating the effects of measures on GHG emissions. from cars with catalytic converters; CFCs and HFCs, which are Energy intensity fell by 0.5-1% per year in road transport leaked and vented from air-conditioning systems; and NO, between 1970 and 1990, and by 3–3.5% per year in air transemitted by aircraft near the tropopause (at this height, the port between 1976 and 1990. Ranges of future traffic growth ozone generated by NO, is a very potent GHG). World trans- and energy-intensity reduction shown in the table are expected port energy use grew faster than that in any other sector, at an to be slower than in the past (SAR II, 21.2.5). Most scenarios in average of 2.4% per year, between 1973 and 1990 (SAR II, the literature foresee a continuing reduction in growth rates for 21.2.1).

energy use whereas these two scenarios are based on constant

growth rates; thus, the HIGH estimates in this table are much GHG mitigation in the transport sector presents a particular higher than 1592e for 2050. The LOW scenario in 2050 is challenge because of the unique role that travel and goods about 10% below 1S92c, and would be unlikely to occur withmovement play in enabling people to meet personal, social, out some change in market conditions (such as a sharp rise in economic and developmental needs (SAR II, 21.2.3). The oil prices) or new policies, for example to reduce air pollution sector may also offer a particular opportunity because of the and traffic congestion in cities. commonality of vehicle design and fuel characteristics. Transport has many stakeholders, including private and com- The largest transport sector sources of GHG through to 2050 mercial transport users, manufacturers of vehicles, suppliers are likely to be cars and other light-duty vehicles (LDVs). of fuels, builders of roads, planners and transport service heavy-duty vehicles (HDVs) and aircraft. Current annual perproviders. Measures to reduce transport GHG emissions often centage growth in all of these is particularly high in southeast challenge the interests of one or another of these stakehold- Asia, while some central and eastern European countries are ers. Mitigation strategies in this sector run the risk of failure seeing a very rapid increase in car ownership. Two-wheelers, unless they take account of stakeholder concerns and offer better means of meeting the needs that transport addresses.

• This section is based on SAR II, Chapter 21. Mitigation Options in The choice of strategy will depend on the economic and tech- the Transportation Sector (Lead Authors: L. Michaelis, D. Bleviss, nical capabilities of the country or region under consideration J.-P. Orfeuil. R. Pischinger, J. Crayston, O. Davidson, T. Kram, N. (SAR II, 21.4.7).

Nakicenovic and L. Schipper).

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TOTAL RANGE

63-71

1 166-1 314

1 318 2094

1 418 2680

1 791 5774

Bered on SAR L, 2125 and 21.3.1, unless otherwise noted Bened on SAR L. 2121. «cristions in this table are calculated from energy consumption using a constant emission factor for all modes of 185 MICEJ. •Based on SAR IL. 21.24. •Enagy use per vehicle kilomeer in the case of cars, energy use per lon kilometre for goods vehicles and rail, marine and air freight, and energy per passen par kilometre for buses, air and rail transport

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Technologies, Policies and Measures for Mitigating Climase Change especially mopeds with two-stroke engines, are one of the in 2020 might amount to 10–25% of projected energy use, fastest growing means of personal transport in parts of south with vehicle price increases in the range

$500-1 500. Larger and east Asia and Latin America, but account for only 2-3% of savings in energy are possible at higher cost, but these would global transport energy use (SAR II, 21.2.4). These vehicles not be cost-effective (NRC, 1992; ETSU, 1994; DeCicco and have very high emissions of local pollutants.

Ross, 1993; Greene and Duleep. 1993).

Annex I countries accounted for about three-quarters of global The potential for cost-effective energy savings in commercial transport sector CO, emissions in 1990. This share is likely to vehicles has been studied less than that in cars, and is estimatdecline to about 60–70% by 2020 (SAR II, 21.2.2) and furtber ed to be smaller-perhaps 10% for buses, trains, medium and by 2050, assuming continuing rapid growth in noo-Annex I beavy trucks and aircraft-because commercial operators countries.

already have stronger incentives to use cost-effective technology (SAR II, 21.3.1.5).

cost.

3.3 Technologies for Reducing

Energy-intensity reductions are possible beyond the level that GHG Emissions in the Transport Sector

is cost-effective for users; bowever, vehicle design changes

that offer large reductions in energy intensity also are likely to Transport systems and technology are evolving rapidly affect various aspects of vehicle performance (SAR II, Although in the past this evolution has included reductions in 21.3.1.5). Achieving these changes would thus depend either energy intensity for most vehicle types, relatively little reduc- on a shift in the priorities of vehicle manufacturers and purtion occurred during the decade prior to 1996. Instead, recent chasers, or on breakthroughs in technology performance and technical advances mainly have been used to enhance performance, safety and accessories (SAR II, 21.2.5). There is liale or no evidence for any saturation of transport energy demand Where energy-intensity reductions result from improved vehicle as marginal income continues to be used for a more transport- body design. GHG mitigation may be accompanied by a intensive lifestyle, while increasing value-added in production reduction in emissions of other air pollutants, where these are involves more movement of intermediate goods and faster, not controlled by standards that effectively require the use of more flexible freight transport systems.

catalytic converters. On the other hand, some energy-efficient

engine designs (c.8.. direct fuel injection and lean-buru A number of technological and infrastructural mitigation engines) have relatively high emissions of NO, or particulate options are discussed in the SAR (II, 21.3). Several are already matter (SAR II, 21.3.1.1). cost-effective in some circumstances (ie., their use reduces private transport costs, taking into account coergy savings. Changes in vehicle technology can require very large investimprovements in performance, etc.). These options include ments in new designs, techniques and production lines. These energy-efficiency improvements; alternative energy sources; short-term costs can be minimized if energy-efficiency and infrastructure changes, modal shifts and fleet management. improvements are integrated into the normal product cycle of The cost-effectiveness of these technical options varies widely vehicle manufacturers. For cars and trucks, this means that among individual users and among countries, depending on there might be a ten-year delay between a shift in priorities or availability of resources, know-how, institutional capacity and incentives in the vebicle market, and the full results of that technology, as well as on local market conditions.

shift being seen in all the vehicles being produced. For aircraft, the delay is longer because of the long service life of air

craft, and because new technology is only approved for gen3.3.1 Energy-efficiency Improvements

eral use after its safe performance has been demonstrated

through years of testing. Some energy-intensity reductions are cost-effective for vehicle operators, because fuel savings will compensate for the additional cost of more energy efficient vehicles (SAR II. 21.3.1). 3.3.2 Alternative Energy Sources Several studies have indicated that these potential savings are not achieved for a variety of reasoos, in particular their low On a full-fuel-cycle basis, alternative fuels from renewable importance for vehicle manufacturers and purchasers relative energy sources have the potential to reduce GHG emissions to other priorities, such as reliability, safety and performance. from vehicle operation (i.e., excluding those from vehicle Many vehicle users also budget for vehicle operation separately manufacture) by 80% or more (SAR IL 21.3.3.1). At present, from vehicle purchase, especially wbere the latter depends on these fuels are more expensive than petroleum products under obtaining a loan, so that they do not trade off the vehicle price most circumstances, although vehicles operating on liquid directly against operating costs. Although fuel savings may not biofuels can perform as well as conventional vehicles and justify the time, effort and risk involved for the individual or manufacturing costs need be no higher in mass production. corporate vebicle purchaser, they could be achieved through Widespread use of these fuels depends on overcoming various measures that minimize or bypass these barriers. In cars and barriers, including the costs of transition to dew vehicle types, other personal vehicles, savings that are cost-effective for users fuel production and distribution technology. concerns about

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