United States
             Environmental Protection
             Agency
              Strategic Studies Staff
              Office of Policy and
              Resources Management
              Washington, DC 20460
                            September 1983
v>EPA
Can We Delay A
Greenhouse Warming?

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COVER-APOLLO 13 VIEW OF EARTH WITH SOUTHWESTERN U.S. AND NORTHERN MEXICO VISIBLE
       NASA PHOTO

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    CAN WE DELAY A GREENHOUSE WARMING?
    The Effectiveness and Feasibility

      of Options to Slow a Build-Up

   of Carbon Dioxide in the Atmosphere
              STEPHEN SEIDEL
   U.S. Environmental Protection Agency

                   and

                DALE KEYES
                Consultant
         Strategic Studies Staff
        Office of Policy Analysis
Office of Policy and Resources Management
          Washington, D.C. 20460
             September  1983

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For sale by the Superintendent of Documents, U.S. Government Printing Office
                        Washington, D.C. 20402

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                        TABLE OF CONTENTS

CHAPTER                                                     PAGE

EXECUTIVE SUMMARY	  i

   1. C02 AND THE GREENHOUSE EFFECT:   STUDY OVERVIEW	  1-1

        BACKGROUND  TO  THE  GREENHOUSE  EFFECT	  L-2
        CURRENT UNDERSTANDING OF THE  POTENTIAL
          FOR GLOBAL WARMING	  1-3
        IMPLICATIONS OF THE GREENHOUSE EFFECT	  1-5
        POSSIBLE ADVERSE CONSEQUENCES	  1-7
        POSSIBLE BENEFICIAL CONSEQUENCES	  1-9
        NET  EFFECTS AND TRANSITIONAL  PROBLEMS	  L-9
        DEFINING THE APPROPRIATE RESPONSE	  1-10
        EVALUATING  THE PREVENTION STRATEGY	  1-13

           METHODOLOGICAL  APPROACH	  1-14
           BASELINE SCENARIOS	  1-15
           POLICY OPTIONS	  1-16
           MEASURES OF EFFECTIVENESS	  1-16
           MEASURES OF FEASIBILITY	  1-18

        FINDINGS AND CONCLUSIONS	  1-19

   2. SCIENTIFIC BASIS FOR A GREENHOUSE WARMING	  2-1

        ROLE OF GREENHOUSE GASES	,	  2-1

           COMPARISONS WITH OTHER PLANETS	  2-3
           EVIDENCE FROM CLIMATE MODELS	  2-4

        TIMING OF TEMPERATURE RISE	  2-6
        THE  ORIGIN  AND EXCHANGE OF CO2
          IN THE ENVIRONMENT	  2-7

           THE CARBON  CYCLE: PAST, PRESENT, AND FUTURE...  2-9
           FRACTION OF CO2 FROM FOSSIL FUELS THAT
           REMAINS  AIRBORNE	  2-11

        INCREASES IN OTHER GREENHOUSE GASES	  2-12

           NITROUS  OXIDE	  2-12
           METHANE	  2-13
           CHLOROFLUOROCARBONS	  2-14
           COMBINED TEMPERATURE EFFECTS: 1970-80	  2-15

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                              -  2  -


CHAPTER                                                     PAGE

        POSSIBLE EFFECTS OF A WARMER EARTH	  2-15

           RECONSTRUCTING  PAST  CLIMATES	  2-16
           MODELING FUTURE CLIMATES	  2-20

        DETECTING A FUTURE GREENHOUSE WARMING	  2-21
        SUMMARY	  2-22

   3. METHODOLOGY FOR PROJECTING  FUTURE ENERGY
        AND CO2 SCENARIOS	  3-1

        PROJECTING ENERGY  USE AND C02 EMISSIONS	  3-3

           ENERGY DEMAND PARAMETERS	  3-7
           ENERGY SUPPLY PARAMETERS	  3-11
           BALANCING SUPPLY AND DEMAND	  3-17
           ESTIMATING CO2  EMISSIONS	  3-18

        PROJECTING ATMOSPHERIC  CO2  LEVELS	  3-19
        PROJECTING ATMOSPHERIC  TEMPERATURE LEVELS	  3-22

   4. THE EFFECTIVENESS OF ENERGY POLICIES
        FOR CONTROLLING CO2	  4-1

        BASELINE SCENARIOS	  4-2

           MID-RANGE BASELINE	  4-2
             Energy Supply and  Demand	  4-2
             CO2 and Atmospheric  Responses	  4-7

           OTHER BASELINE  SCENARIOS	  4-14
             Energy Supply and  Demand .,	  4-14
             CO2 and Atmospheric  Responses	  4-23

           OTHER BASELINE  SENSITIVITY TESTS	  4-26

        POLICY OPTIONS	  4-27

           TAXES ON CO2 EMISSIONS	  4-27
             Energy Supply and  Demand	  4-28
             CO2 and Atmospheric  Responses	  4-31

           FUEL BANS	  4-33
             Energy Supply and  Demand	  4-33
             C02 and Atmospheric  Responses	  4-36

        SUMMARY	  4_41

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CHAPTER                                                     PAGE

   5. THE ECONOMIC AND POLITICAL FEASIBILITY
        OF ENERGY POLICIES	  5-1

        EFFECTS OF POLICIES  ON  COAL RESOURCES	  5-2

           GLOBAL DISTRIBUTION  OF COAL	  5-2
           CHANGES IN VALUE  OF  COAL RESERVES	  5-5
           CHANGES IN FUEL PRICES	  5-7
           CAPITAL INVESTMENTS  IN COAL	  5-7

        EFFECTS OF BANS  ON SHALE OIL AND SYNFUELS	  5-14
        OTHER  IMPEDIMENTS TO POLICY IMPLEMENTATION	  5-15
        SUMMARY	  5-19

   6. NONENERGY OPTIONS  FOR  CONTROLLING CO2 EMISSIONS....  6-1

        OPTIONS FOR CONTROLLING CO2 EMISSIONS	  6-1
        SEQUESTERING CO2 USING  TREES	  6-5

           LAND REQUIREMENTS	  6-6
           FERTILIZER REQUIREMENTS	  6-7
           COSTS OF SEQUESTERING	  6-9

        OFFSETTING THE GREENHOUSE WARMING	  6-13
        SUMMARY	  6-14

   7 . CONCLUSIONS	  7-1

        EFFECTIVENESS OF POLICIES AND SENSITIVITY
          OF RESULTS	  7-1
        FEASIBILITY OF POLICY OPTIONS	  7-5
        MODELING ASSUMPTIONS	  7-6
        IMPLICATIONS OF  FINDINGS	  7-7

APPENDICES

   A.   ENERGY SUPPLY OPTIONS
   B.   THE IEA ENERGY AND C02  EMISSIONS MODEL
   C.   THE ORNL CARBON  CYCLE MODEL
   D.   THE GISS ATMOSPHERIC TEMPERATURE MODEL
   E.   COUPLING THE ORNL AND GISS MODELS TO ESTIMATE
        THE RETENTION RATIO

GLOSSARY OF ENERGY UNITS

REFERENCES

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                        LIST OF FIGURES

FIGURE                                                     PAGE

1-1     Range of Global-Scale Mean Temperature, With
        and Without the Projected Greenhouse Effect	 1-6

2-1     Monthly Atmospheric Carbon Dioxide Concentration
        at Mauna Loa Observatory	 2-8

2-2     Exchangeable Carbon Reservoirs and Fluxes.	 2-10

2-3     Temperature Increases for Several Greenhouse
        Gases	,	 2-17

2-4     Modeled Versus Observed Temperature Trends..	 2-23

3-1     Study Methodology	 3-2

3-2     Geopolitical Regions in the IEA Model	 3-5

3-3     Structure of the IEA Model	 3-6

3-4     Final Atmospheric CO2 Retention Ratios
        for Four Types of CO2 Emissions Scenarios	 3-21

4-1     Mid-range Baseline Scenario:  Energy Use
        Characteristics	 4-4

4-2     CO2 Modeling Results for the Mid-range Baseline
        Scenario	 4-8

4-3     Geographic Distribution of CO2 Emissions
        for the Mid-range Baseline Scenario	 4-10

4-4     Sensitivity of Mid-range Baseline Temperature
        Estimates	 4-12

4-5     High Renewable vs. Mid-range scenarios:
        Fuel Use Characteristics	 4-16

4-6     High Nuclear vs. Mid-range Scenarios:
        Energy Use Characteristics	 4-18

4-7     High Electric vs. Mid-range Scenarios:
        Energy Use Characteristics	 4-20

4-8     Low Demand vs. Mid-range Scenarios:
        Energy Use Characteristics	 4-22

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                             - 2 -
FIGURE                                                      PAGE

4-9     High Fossil vs. Mid-range Scenarios:
        Energy Use Characteristics. .	  4-24

4-10    CO2 Modeling Results for Alternative Baseline
        Scenarios	  4-25

4-11    CO2 Tax Policies vs. Mid-range Baseline
        Scenarios:  Energy Use Characteristics	  4-29

4-12    CO2 Modeling Results for Tax Policy
        and Mid-range Baseline Scenarios	  4-32

4-13    Fuel Bans vs. Mid-range Baseline Scenarios:
        Energy Use Characteristics	  4-34

4-14    CO2 Modeling Results for Fuel Bans
        and Mid-range Baseline Scenarios	  4-37

4-15    Geographic Distribution of CC>2 Emissions
        for Selected Fuel Bans and the Mid-range
        Baseline Scenario	  4-38

5-1     Global Coal Resources	  5-4

5-2     Proved Recoverable Coal Reserves	  5-4

5-3     Process Leading to Action	  5-16

7-1     Changes in the Date of a Two Degree Warming	  7-2

7-2     Changes in Temperature Projected for 2100	  7-4

B-l     Application of CC>2 Emissions Coefficients
        in the IEA Model	  B_8

C-2     Structure of the ORNL Global Carbon Cycle Model...  c-2

E-l     Key Features of the ORNL-GISS Coupling
        Methodology	  E_2

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                         LIST OF TABLES

TABLE                                                      PAGE

3-1     Baseline Values for Population, GNP, Technological
        Change	 3-8

3-2     Breakthrough Prices for Emerging Energy Sources
        in the Mid-range Baseline Scenario	 3-15

3-3     Breakthrough Prices for Traditional Energy
        Sources in the Mid-range Baseline Scenario	 3-21

3-4     Parameter Values for the GISS Model	 3-26

5-1     Approximate Capital Investment for International
        Coal Chain:  Western U.S. to Japanese Power Plant. 5-9

5-2     Approximate Capital Investment for Domestic
        Coal Chain:  Western U.S. to West South Central
        Power Plant	 5-10

5-3     WOCOL Forecasted Net Additions of Coal-Fired
        Power Plants in OECD Countries: 1977-2000	 5-12

5-4     WOCOL Forecasted Cumulative Coal Chain Investments
        for WOCOL Countries in OECD: 1977-2000	 5-13

6-1     Costs of Generating Electricity With and Without
        CO2 Control for Initial Power Plant Capacity of
        200-MW(e)	 6-4

6-2     Fertilizer Requirements for Growing American
        Sycamore Trees, Compared With World Fertilizer
        Production — July 1979-June 1980	 6-8

6-3     Fertilizer Requirements for Giant Leucaena,
        Compared with U.S./Canada and World Production
        Fertilizer Production — July 1978-June 1979	 6-11

A-l     Worldwide Energy Production in 1979	 A-2

A-2     Summary of Energy Supplies	 A-4/5

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                        ACKNOWLEDGEMENTS








     Many individuals made valuable contributions to this study.



In particular, Dr. James Hansen and his colleagues at NASA's



Goddard Institute for Space Studies provided an atmospheric



temperature model, and Dr. William Emanuel of Oak Ridge National



Laboratories made available a carbon cycle model, both of



which we employed in the study. They also provided valuable



guidance in the application of these models. An energy and CO2



emissions model was obtained from the Institute for Energy



Analysis. Alan Truelove of Pechan and Associates, Inc. assisted



in operating and integrating the various computer programs.



We would also like to thank Ken Schweers and Mike Gibbons of



ICF Inc., who contributed background information and insights



into the economic costs of limiting fossil fuel use.



     Martin Wagner, Acting Director of EPA's Energy Policy Division,



and John Hoffman, who directs EPA's research program on greenhouse



effects, provided useful comments on previous drafts. We are



also indebted to several other reviewers: Dr. Martin Miller



and Dr. David Rose, both of the Massachusetts Institute of



Technology; Dr. Henry Lee, the Director of Harvard's Energy



and Environmental Policy Center; and Jesse Ausebel of the



National Academy of Sciences. However, the contents and conclusions



of the study remain the responsibility of the authors.

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                        EXECUTIVE SUMMARY






     Evidence continues to accumulate that increases in atmos-



pheric carbon dioxide (CC>2) and other "greenhouse" gases will



substantially raise global temperature.  While considerable



uncertainty exists concerning the rate and ultimate magnitude



of such a temperature rise, current estimates suggest that a 2°C



(3.6°F) increase could occur by the middle of the next century,



and a 5°C (9°F) increase by 2100.  Such increases in the span of



only a few decades represent an unprecedented rate of atmospheric



warming.



     Temperature increases are likely to be accompanied by dramatic



changes in precipitation and storm patterns and a rise in global



average sea level.  As a result, agricultural conditions will be



significantly altered, environmental and economic systems poten-



tially disrupted, and political institutions stressed.



     Responses to the threat of a greenhouse warming are polarized.



Many have dismissed it as too speculative or too distant to be of



concern.  Some assume that technological options will emerge to



prevent a warming or, at worst, to ameliorate harmful consequences.



Others argue that only an immediate and radical change in the rate



of CC>2 emissions can avert worldwide catastrophy. The risks are



high in pursuing a "wait and see" attitude on one hand, or in



acting impulsively on the other.

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                              - 11 -






     This study aims to shed light on the debate by evaluating



the usefulness of various strategies for slowing or limiting a



global warming.  Better information is essential if scientific



researchers, policymakers, and private sector decisionmakers



are to work together effectively in addressing the threat of




climate change.






FOCUS OF STUDY



     Because increases in atmospheric CC>2 primarily result from



the use of fossil fuels, one logical response to the threat of



climate change is to reduce global dependence on these energy



sources.  This study takes a first look at whether specific



policies aimed at limiting the use of fossil fuels would prove



effective in delaying temperature increases over the next 120



years.  Specifically, it examines whether a tax on the use of



fossil fuels or a ban on the use of coal, shale oil, or synfuels



could be effective  in delaying a greenhouse warming.  These



policies are also evaluated for their economic and political



feasibility.  To put our findings in perspective, alternative,



nonenergy approaches to limiting a greenhouse warming are also



reviewed.






METHODOLOGY



     Evaluating the effectiveness of energy policies to reduce



levels of C02 requires the estimation of future patterns of



energy use, the effect of these patterns on CO2 emissions, the

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                             - Ill -


fate of CC>2 once emitted, and the relationship between levels of

atmospheric CO2 and temperature.  Three models were used in the

estimation process:

     •  a world energy model to project future supply and demand
        for alternative fuels and to estimate CC>2 emissions based
        on fuel use mixes;

     •  a carbon cycle model to translate CC>2 emissions into
        increases in atmospheric CO2 concentrations; and

     •  an atmospheric temperature model to estimate changes
        in temperature based on increases in atmospheric CO2
        and other greenhouse gases.

We used these models to explore a range of possible assumptions

about, energy demand and technologies, atmospheric responses, and

policy alternatives.

     We evaluated both medium-run (by the middle of the next

century) and long-run (by 2100) effects, placing greater confi-

dence in the shorter run results.  The timing of a 2°C rise is

employed as the measure of medium-run effectiveness.  A temper-

ature increase of this magnitude by mid-century would represent

a dramatic departure from historical trends — a rate of increase

equal to roughly 0.3°C per decade, compared with a rise of 0.04°C

per decade during the past 100 years.  Over the long run, the

absolute temperature rise in 210U is used as the measure of

effectiveness.  Rough estimates of technical constraints, costs,

and the need for political cooperation are used to judge

feasibility.

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                              - IV -






BASELINE TRENDS



     We developed the Mid-range Baseline scenario as a "best



guess" of future energy patterns.   Under this scenario/ atmos-



pheric CC>2 levels would reach 590 ppm, or double pre-industrial



levels, by 2060, and a 2°C temperature rise would occur around



2040.  By 2100, global warming would approach 5°C.  These esti-



mates are particularly sensitive to (1) the assumed temperature



response to a doubling of CC>2f and (2) the rate of increase of



greenhouse gases other than CO2 (i.e., methane, nitrous oxide,



and chlorofluorocarbons).  By varying these factors within



reasonable ranges, the projected date of a 2°C warming shifts



from roughly 2015 to 2095.  In direct contrast, changes in the



projected costs of alternative fuels or in fuel users' behavior



(i.e., the degree of conservation in response to rising energy



prices and other factors) has almost no effect on the estimated



timing of a 2°C rise in temperature.  Specifically, scenarios



reflecting significant reductions in the future cost of nuclear



power and renewable energy, increased conservation, and expanded



electrification have little influence on the date of a 2°C warming,



and only a minor effect on the temperature rise in 2100 (5-10



percent).  Similarly, significant reductions in the baseline



costs of shale oil or synfuels fail to accelerate a projected



2°C warming, and estimated temperature in 2100 increases by less



than 5 percent.  These findings attest to the substantial momentum



built into temperature trends, due to the effect of other green-



house gases and to the difficulty in changing fuel-use patterns

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                              - v -
SUMMARY OF FINDINGS

     Our analysis of energy and nonenergy policies to slow or

limit a global warming produced the following results:

     Only One of the Energy Policies Significantly
     Postpones a 2°C Warming

     •  Worldwide taxes of up to 300% of the cost of fossil fuels
        (applied proportionately based on C02 emissions from each
        fuel) would delay a 2°C warming only about 5 years beyond
        2040.

     •  Fossil fuel taxes applied to just certain countries or
        applied at a 100% rate would not affect the timing of
        of a 2°C rise.

     •  A ban on synfuels and shale oil would delay a 2°C warming
        by only 5 years.

     •  Only a ban on coal instituted by 2000, would effectively
        slow the rate of temperature change and delay a 2°C change
        until 2055.  A ban on both coal and shale oil would delay
        it an additional 10 years — until 2065.        ;

     Major Uncertainties Include Growth of Other Greenhouse
     Gases and Temperature Sensitivity of the Atmosphere,
     but Not Baseline Energy Scenarios

     •  Uncertainties concerning the rate of growth of other
        greenhouse gases could advance the date of a 2°C warming
        by 15 years or delay it by 30 years.

     •  The plausible range of sensitivity of the atmosphere
        to increases in greenhouse gases creates a 35-year band
        of uncertainty around the projected year (2040) for a
        2°C warming.

     •  In contrast, alternative energy futures, including sig-
        nificant shifts in the relative costs of fuels, changes
        in energy demand, and reduced economic growth, cause only
        minor (i.e., five years or less) changes in the date of
        a 2°C warming.

These findings are illustrated in the following chart.  Each bar

represents the number of years the 2°C date is delayed (bar above

line) or advanced (bar below line), compared with the Mid-range

Baseline projections.

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                                  CHANGES IN THE DATE OF A 2° C WARMING
                                     (PROJECTED DATE IN MID-RANGE BASELINE: 2040)
                      ALTERNATIVE ENERGY
                            BASELINES
               2070
(MID-RANGE CASE) 2040*
               2025
                              5 YRS
                        0 YRS  t|
5 YRS
           OTHER
           GASES*
        30 YRS
               HIGH
              GROWTH
TEMPERATURE
 SENSITIVITY t
                                                             25 YRS
                        HIGH    HIGH    LOW       NO
                        FOSSIL ELECTRIC DEMAND   GROWTH
                               HIGH
ENERGY POLICIES
                                                                                          25 YRS
                                                                                    15 YRS
                                                                             5 YRS
                                                              LOW
                                                                                                 5 YRS  < 5 YRS

                                                                   10 YRS
                                                   15 YRS
                                        BAN ON
                                        SHALE
                                         AND
                                         SYN-
                                         FUELS
                       BAN ON
                         COAL
      BAN ON
       COAL
       AND
       SHALE
 300%
WORLD
FOSSIL
 FUEL
 TAX
 100%
WORLD
FOSSIL
FUEL
TAX
  •REFERS TO GREENHOUSE GASES OTHER THAN CO2: NITROUS OXIDE, METHANE, AND CHLOROFLUOROCARBONS.

  tREFERS TO THE TEMPERATURE RISE IN RESPONSE TO A GIVEN INCREASE IN GREENHOUSE GASES
  ONCE AN EQUILIBRIUM HAS BEEN REACHED.

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                        - vii -
Bans on Coal and Shale Oil Are Most Effective
in Reducing Temperature Increases in 2100

•  A worldwide ban on coal (and thus coal-derived synfuels)
   instituted by 2000 would reduce temperature  change by
   30% (from 5°C to 3.5°C).

•  Together, a ban on shale oil and coal would  reduce the
   projected warming in 2100 from 5°C to 2.5°C.

•  Bans on shale oil alone or synfuels alone would be
   less effective.

•  A 100% worldwide tax would reduce warming by less than
   1.0°C in 2100.

A Ban on Coal Seems Economically and
Politically Infeasibile

•  Though detailed estimates of total costs of  a ban on coal
   were beyond the scope of this study, initial approxima-
   tions based only on asset losses and increases in prices
   of alternative fuels suggest that a coal ban is economi-
   cally infeasible.

•  A worldwide ban on coal also appears to be politically
   infeasible.  Because the burden would be unevenly distri-
   buted (e.g., most of the world's coal is concentrated in
   only three nations, and use of coal varies dramatically
   between developed and developing nations), worldwide
   cooperation required to ban coal is unlikely.

At Best, Nonenergy Options to Limit
Global Warming Are Highly Speculative

•  Scrubbing CC>2 emissions from power plants is of limited
   effectiveness and prohibitively expensive.

•  Capturing ambient CC>2 through massive forestation would
   place too great a burden on land, fertilizer, and
   irrigation requirements.

•  In theory, adding SO2 to the stratosphere might counter-
   balance the greenhouse warming effect, but at great cost.
   Moreover, the effectiveness and potential adverse environ-
   mental consequences of this proposal require much additional
   research.

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                             - Vlll -






IMPLICATIONS OF FINDINGS



     The implications of our findings point to action directed



in the following three areas:



     Accelerate and Expand Research on Improving Our Ability to



     Adapt to a Warmer Climate —  This research should focus



     on enhancing the positive and minimizing the negative



     aspects of a greenhouse warming.  It should also address



     problems likely to occur during the transitional stage when



     social and economic systems are adapted to the consequences



     of increased CC>2 and temperature.  A key element of this



     research must be developing regional climate scenarios that



     can be used to evaluate the costs and benefits associated



     with possible changes in climate and that can serve as a



     baseline against which possible adaptive actions can be



     evaluated.



     Narrow Uncertainties About the Future Effects Greenhouse



     Gases Other Than CO? — Research relating to other greenhouse



     gases should focus on developing a better understanding of



     the natural and man-made sources and sinks of these gases,



     of their interactions with other atmospheric gases, (espec-



     ially their effects on atmospheric ozone), and of possible



     strategies to mitigate their influence on future global



     warming.

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                              - IX -






     Reducing Uncertainty About the Thermal Sensitivity of the




     Atmosphere — Narrowing the range of uncertainty regarding




     the temperature sensitivity of the atmosphere to increases




     in greenhouse gases will depend on expanded modeling efforts.




     Cloud formation and ocean systems must be more realistically




     represented in climate models, and our ability to use these




     models in predicting transient warming effects must be




     improved.



     Our analysis underscores the need to reduce remaining scien-




tific uncertainties as quickly as possible.  Substantial increases




in global warming may occur sooner than most of us would like to




believe.   In the absence of growing international consensus on




this subject, it is extremely unlikely that any substantial actions




to reduce CO2 emissions could or would be taken unilaterally.



Adaptive strategies undertaken by individual countries appear to




be a better bet.  But for these strategies to succeed, much more




precise and detailed information will be needed on the timing



and regionally disaggregated consequences of a global warming.

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                            CHAPTER 1



          CO? AND THE GREENHOUSE EFFECT; STUDY OVERVIEW   "






     The scientific community is growing increasingly  concerned



about the build-up of carbon dioxide  (CC^)  in the atmosphere.



Resulting primarily from the use of fossil  fuels, CC>2  emissions



may alter the radiative balance of the earth, increasing global



temperature, and dramatically changing global climate.  Although



much uncertainty remains concerning the magnitude, timing, and



possible effects of rising levels of CO2, this issue is considered



to be one of the most important facing the  scientific  community,



and one that raises significant questions for policymakers.



     This study explores one particularly important aspect of



the CO2 issue — the potential effectiveness and feasibility of



alternative public actions aimed at limiting or delaying a CO2~



induced rise in temperature.  It focuses on policies to reduce



the use of fossil fuels, including energy taxes and bans on the



use of synfuels, shale oil, and coal.  It also reviews other



approaches to delaying temperature change.  These include removing



CC>2 from flue gases after fuel combustion, sequestering CO2 from



the atmosphere by planting trees, and seeding the atmosphere with



SC>2 to block incoming solar energy.  By providing new  information



on both energy and nonenergy approaches to modifying the green-



house effect, we hope to focus current and  future discussions on



what to do about rising

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                               1-2






BACKGROUND TO THE GREENHOUSE EFFECT



     The "greenhouse theory" — that increases in CC>2 will warm



the earth — was first developed by scientists before the turn



of the century (Arrenhius, 1896).  This theory holds that certain



"greenhouse" gases in the atmosphere allow the sun's ultraviolet



and visible radiation to penetrate and warm the earth, but then



absorb the infrared energy the earth radiates back into the



atmosphere.  By blocking the escape of this radiation, these



gases effectively form a thermal blanket around the earth.  To



rebalance the incoming and outgoing radiation, the earth's



temperature must increase.  Based on the current level of CC>2



in the atmosphere, the average global temperature now stands at



288°K, approximately 35°K warmer than it otherwise would be



(Chamberlain, et al., 1982).



     Carbon dioxide is the principal greenhouse gas.  Methane,



chlorofluorocarbons, and nitrous oxide, along with water vapor,



also exhibit greenhouse properties.  Increases in the atmospheric



levels of these other trace gases could add significantly to any



future CC>2-induced global warming.



     Since the onset of the industrial revolution, increases in



atmospheric CC>2 levels have been small, but significant.  From



1860 to the present, the concentration of CC>2 has grown from



about 270-290 parts per million (ppm) to 339 ppm (Keeling, 1982).



Our increased reliance on fossil fuels is directly responsible



for most of this growth.  By burning large quantities of these

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                               1-3






fuels every year, we are shifting enormous quantities of  carbon



— roughly 5 billion metric tons annually — to the atmosphere



from the earth where it had been inactive over millions of years



(Rotty, 1983).






CURRENT UNDERSTANDING OF THE POTENTIAL FOR GLOBAL WARMING



     The greenhouse theory assumes that, holding everything else



constant, altering the composition of the atmosphere by adding



large quantities of CC>2 and other greenhouse gases will warm the



earth.  While the physical laws underlying the theory are well



established and straightforward, the assumption that all else



will remain constant is not reasonable.



     The global climatic system is extremely complex.  It consists



of many interrelated components that, in themselves, are only



partially understood.  Changing one of these components — in this



case, increasing the quantity of atmospheric greenhouse gases —



will undoubtably have repercussions throughout the natural systems



that determine global climate.



     To identify the extent to which increases in CC>2 would raise



atmospheric temperature or, conversely, to isolate the nature



and magnitude of countervailing forces, the National Academy of



Sciences (NAS) convened a study panel chaired by Dr. Jule Charney



in 1979.  After reviewing the existing scientific evidence, this



panel concluded that a doubling of pre-industrial atmospheric CC>2



levels would most likely increase global climate 3.0 + 1.5°C

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                               1-4


(Charney, 1979).*  Recognizing that these findings would be

"comforting to scientists but disturbing to policymakers," the

panel further stated:

     To summarize, we have tried but have been unable to
     find any overlooked or underestimated physical effects
     that could reduce the current estimated global warmings...
     to negligible proportions or reverse them altogether....
     It appears that the warming will eventually occur....
     (Charney, 1979)

A second NAS panel, convened in 1982, reexamined these conclusions

in light of more recent research.  It concluded: "The present

study has not found any new results that necessitate substantial

revision of the conclusions of the Charney report" (Smagorinsky,

1982).**

     Several  investigators have projected that CO2 will double

by the middle of the next century (e.g., Anderer, 1981; Nordhaus,

1977).  When  viewed  in the context of historical changes in

temperature,  the projected temperature rise must be considered

substantial.
*  The NAS panel examined increases in temperature due only to
   CO2-  Other greenhouse gases could further increase global
   warming by 50% - 100% (see Chapter 2).

** Despite reaffirming the first panel's conclusions, consider-
   able uncertainty remains.  For example, while the second
   panel agreed that a temperature rise of 3.0 +_ 1.5°c is the
   most likely response to a doubling of CC>2, it hedged this
   projection with a footnote that the first panel intended
   the true value would fall within this range with only a 50%
   probability.

-------
                               1-5






Temperature changes of 5.0°C cover the entire temperature  range



experienced during the past 125,000 years, which extend from  the



last interglacial period to the present one  (Mitchell, 1977).



The projected warming induced by increases in CC>2 thus could



equal historical changes in climate in a matter of only 120 years.



     The possible magnitude of temperature change tells only  part



of the story.  The rapid occurrence of this  change must be empha-



sized to more clearly put  it in historical perspective.  Although



the earth has experienced  significant changes in temperature,



they generally have occurred over tens of thousands of years  and



must be viewed in terms of geologic time, instead of the several



decades during which an equivalent CO2~induced warming is  likely



to occur.  As a result, we will soon experience climatic trends



that significantly deviate from the past (see Figure 1-1).



     Chapter 2 of this report explains in greater detail the



scientific basis and uncertainties surrounding projections of a



greenhouse warming.





IMPLICATIONS OF THE GREENHOUSE EFFECT



     Warmer global temperatures are just one aspect of CO2~induced



changes to the natural environment.  A rise  in sea level,  changes



in precipitation and water availability, altered storm patterns



and frequencies, and changes in growing seasons are all signifi-



cant climatic events likely to accompany a greenhouse warming.



Many parts of the world are likely to suffer from these changes,



yet others are likely to benefit.

-------
                                1-6
                             FIGURE  1-1


   RANGE OF GLOBAL-SCALE MEAN TEMPERATURE,  WITH AND WITHOUT THE
                        PROJECTED C02  EFFECT
        -5
        0)

        3
        TO


        I
         c
         10
         Q>
5 -

4


3r-

2

1
               Observed past changes
                    \
 Present
                         Range of natural j
                             t'ons    ;
                             ic "noise"):
                                         I
                                    I
                   ID'
                    9
                    8
                    7

                    6
                    5
                    4
                    3
                    2
                    1
                    0
                   -1
                   -2
            1850
       1900
1950
2000
2050
2100
Source: CEQ  (1981).  Based on J.M.  Mitchell, Jr.,  (1977)  "Some
        Considerations of Climate  Variability in  the  Context of
        Future  CO2 Effects on Global-Scale Climate,"  in  Elliot
        and  Machta,  Carbon Dioxide Effects Research and  Assess-
        ment Program; Workshop on  the Global Effects  of  Carbon
        Dioxide from Fossil Fuels.

-------
                             1-7






     Given the limited knowledge of specific regional effects



resulting from higher levels of CC>2r it is now impossible to



predict the net effect of such changes.  Moreover, the analysis



of ultimate effects must also account for difficulties encountered



during the transitional period when climate is changing, and for



the possibility that some negative effects will be mitigated,



depending on the success and speed of efforts to adapt economic



activity to altered climatic conditions.






POSSIBLE ADVERSE CONSEQUENCES



     A warmer climate could dramatically change existing eco-



systems, affect the habitability of many areas of the world, and



alter the relationship between developed and developing nations.



Adverse impacts will result primarily from increases in temper-



ature, changes in precipitation, changes in storm patterns, and



increases in sea level.



     A warmer climate will raise sea level by warming and



expanding the oceans, and by melting ice and snow now on land.



By itself, thermal expansion could raise sea level significantly.



Further in the future, this rise may be enhanced by significant



ice melting and discharges from land-based glaciers.  Given



current uncertainties, an initial effort to estimate the range



of possible sea level rise concluded that increases of



anywhere from about 48 to 380 cm (2 to 12 ft.)  are possible



in the next 120 years (Hoffman, 1983). An increase of

-------
                               1-8
of even 48 cm could flood or cause storm damage to many of the



major ports of the world, disrupt transportation networks, alter



aquatic ecosystems, and cause major shifts in land development




patterns.



     The consequences of climate change will differ depending on



whether or not adjustments are feasible.  For example, changes



in climate will require significant adjustments in agricultural



practices (e.g., breeding new strains of seeds adapted to changed



CC>2 levels and climate) and in land-use patterns (e.g., shifting



away from coastal areas).  To the extent that these adjustments



are made in a timely manner, many of the adverse consequences of



a CO2 warming can be minimized.  In other situations, however,



adjustments simply may not be feasible and a total loss may result.



For example, despite adjustments to agricultural practices, some



currently productive land may no longer be suitable for farming



because of significant changes in the length of the growing season



or in rainfall patterns.  Similarly, if water resource planning



does not anticipate shifts in rainfall patterns, water shortages



could reach catastrophic proportions.



     Recent changes in weather conditions experienced throughout



many parts of the world (attributed by some to the El Nino meteoro-



logic phenomenon) give some indication of the economic and social



consequences of dramatic shifts in climate.  Initial estimates



place damages due to droughts and floods at over $8 billion and



deaths at over 1,000 (Washington Post, 1983).

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                               1-9






POSSIBLE BENEFICIAL CONSEQUENCES



     In contrast to these negative effects,  increases  in  atmos-



pheric CO2 are likely to enhance photosynthesis and decrease



moisture requirements for plant growth — both of which should



increase agricultural productivity.  A global warming  could also



improve climate for high latitude areas, increase precipitation



for some parts of the world, and reduce heating costs  worldwide.



     To a limited extent, these altered conditions, by themselves,



will enhance certain economic activities.  For example, without



any changes in agricultural practices, higher CC>2 levels  will



enhance the productivity of many crops.  However, some plants will



respond to this stimulus more than others.   Only by taking steps



to identify and expand  the use of those plants that benefit the



most will nations be able to maximize the advantages of higher



levels of
NET  EFFECTS AND  TRANSITIONAL  PROBLEMS



      Even  areas  that  directly benefit  from or  that ultimately




adapt to altered conditions may  experience difficulties redirecting



their economies  to meet  the challenges of rapidly changing clima-




tic  conditions.   Decisions concerning  agricultural practices,




land-use patterns, and coastal structures often assume that  cli-




matic conditions will be roughly the same as in the past.  For




example, many  decisions  about tree  selection,  road and bridge




construction,  and 'coastal development  have been based on a

-------
                               1-10






continuation of historical climate trends during the useful life



of these activities, which is 50 years or more.  Future damages



can be minimized only if these assumptions are changed for the



next generation of decisions.  Of course, the precision and



detail of the predictions of climatic change must be greatly



improved if they are to be used in public works and resource



planning.



     Whether an individual country benefits or is harmed will



depend on its location, its resource and industrial base, and,



most importantly, its ability to prepare and adapt to changing



climatic conditions.  If climate dramatically changes, it will



likely affect nearly the entire range of human activity.  The



magnitude of these effects, and whether they are positive or



negative, depends to a large extent on how quickly these changes



occur — or on our ability to delay climatic change -- and how



successfully global society anticipates and adjusts to them.





DEFINING THE APPROPRIATE RESPONSE



     Given the potential magnitude of the CO2 problem, it is not



surprising that many have raised the question:  What can be done?



Are there steps that we can and should take to prevent COo from



rising to some unacceptable level?  Or, instead, should we explore



actions aimed at minimizing the costs of adapting to COo-induced



changes?  In either case, how soon do we have to act?

-------
                               1-11


     While there are no simple answers to these questions,  a

growing body of experts is calling for action now.  For example,

in its 1979 report, the National Academy of Sciences warned against

further delay in responding to the CC>2 problem — "A wait and  see

attitude may mean waiting until it's too late" (Charney, 1979).

     Along similar lines, a report by the President's Council  on

Environment Quality concluded: "If a global response to the CC>2

problem is postponed for a significant time, there may not be

time to avoid substantial economic, social, and environmental

disruptions once a CC^-induced warming trend is detected"

(CEQ, 1981).

     Calls for an immediate response have also been voiced at

Congressional hearings, in newspaper editorials, and in news

magazines across the nation.  Such calls for action are not

surprising, given the magnitude of the potential climatic changes

that might accompany further  increases in atmospheric CC^.  In

the minds of many, concern about these changes far outweighs

remaining uncertainties surrounding their exact nature and timing.

     Two very different strategies could be employed to respond

to this call for action.*   The first approach is an adaptive

strategy.  Rather than seeking to limit CC>2 increases, it focuses
*  For another discussion of these strategies, compare "Reduction
   at the Source," Scroggin and Harris, and "A More Feasible Soical
   Response," Lave, both in Technology Review, Nov./Dec. 1981.

-------
                               1-12






on steps that would minimize the negative and maximize  the  posi-



tive effects of CO2-  For example, land development would be



directed in-land to avoid damage from the rise in sea level,  and



agricultural practices would be shifted to take advantage of



increases in photosynthesis.



     In contrast, a prevention strategy seeks to delay  or limit



the build-up of greenhouse gases in the atmosphere.  Since  CC>2



results primarily from the burning of fossil fuels, this strategy



necessarily implies a shift in current patterns of energy use.



     These two alternatives are, of course, not mutually exclusive.



By limiting use of fossil fuels and, slowing the rise of CC>2, we



would be buying more time to design and implement adaptive  actions.



     Given the large uncertainty in projecting likely climatic



changes and resulting socioeconomic effects, any comparison of



the costs and benefits of these alternative approaches  would  now



be little more than guesswork.  Although researchers have called



for development and evaluation of regional scale scenarios  that



could be used for analyzing the impacts of CC>2, with few excep-



tions, these projects remain as items on future research agendas



(Kellogg, 1981).  Only after initial estimates are developed  of



the economic effects of rising CC>2 levels will researchers  be able



to quantitatively compare the desirability of adaptive  versus



preventive approaches to dealing with the CO2 problem.

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                               1-13






     Nevertheless, by focusing specifically on the potential



effectiveness of alternative policy actions aimed at delaying  or



limiting a rise in atmospheric CC>2 levels, we can provide useful



insights into whether "adaptation or prevention" or some combina-



tion thereof is the appropriate response.  This study contributes



to that goal.






EVALUATING THE PREVENTION STRATEGY



     Two general approaches to slowing or limiting CO2  increases



have been mentioned — one that relies on altering patterns of



energy use, and one that employs nonenergy strategies.  The first



approach attempts to mitigate the CC>2 problem indirectly.  Burning



less coal, oil, and gas, would slow the rate of increase in CC>2



emissions.  Shifting away from fossil fuels, however, would entail



a radical change  in the energy foundation upon which current



economic activity rests.  Under the second approach, CC>2 is



captured either before or after emission to the atmosphere (i.e.,



removed from flue gases using scrubbers or sequestered  from the



ambient air using trees), or the amount of incoming solar radia-



tion absorbed by  the earth is reduced via novel schemes.  Chapter



6 of this analysis examines the effectiveness, costs, and feasi-



bility of these options.



     Altering fuel-use patterns has been the most commonly dis-



cussed approach to preventing a global warming.  However, such



an approach carries with it several potentially severe  effects.

-------
                               1-14
These include:

     •  reducing the value of the vast global fossil fuel
        resources;

     •  making prematurely obsolete some portion of the capital
        infrastructure that supports current patterns of produc-
        tion, transportation, and use of fossil fuels; and

     •  increasing the percentage of total capital invested in
        the energy sector to pay for more expensive energy
        alternatives.

     The magnitude of these economic disruptions would depend on

how rapidly alternative energy sources must substitute for fossil

fuels.  The acceleration of the rate at which fossil fuels are

displaced will, in turn, depend on the shift to nonfossil fuels

due to market forces alone, and on the rate of acceptable climatic

change.  Furthermore, the shift away from fossil fuels perhaps

could be instituted more gradually and therefore less expensively

if energy policies were adopted now rather than several decades

later.

     METHODOLOGICAL APPROACH

     Determining the effectiveness and feasibility of shifting

energy consumption to prevent or limit a rise in temperature

involves modeling the complex interaction among energy technolo-

gies and resources, world economies, the carbon cycle, and atmos-

pheric physics.  For this analysis we used three models: the

world energy model of the Institute for Energy Analysis, the

carbon cycle model of the Oak Ridge National Laboratory, and

the atmospheric temperature model of the Goddard Institute for

-------
                               1-15






Space Studies.  By integrating these models, we developed a method



for (1) estimating the likely global warming for a range of alter-



native energy futures, and (2) evaluating the effectiveness of



alternative policies to delay or limit that warming.  Chapter 3



explains each of these models and their underlying assumptions in



greater detail.



     We evaluated the nonenergy strategies less rigorously,



although still quantitatively.  Using simple conceptual models



and extrapolating from literature reports, we made first-order



estimates of  the effectiveness and feasibility of each of the



three  strategies.



     BASELINE SCENARIOS



     The energy scenarios examined as part of this study start



with a baseline that assumes mid-range estimates for alternative



fuel costs, economic growth, and other key parameters.  In addi-



tion,  alternative future scenarios examine CC>2 and temperature



changes that would result if the costs of nonfossil alternatives



(e.g., nuclear or solar) prove to be lower than expected, if



projections of energy conservation or future energy demand prove



to be  high, or if, on the other hand, mid-range estimates of the



costs  of new  fossil fuel technologies prove to be low.  Together,



these  alternative baselines provide a range of possible energy



futures against which various policies aimed at reducing fossil



fuel use can be examined.

-------
                               1-16


     POLICY OPTIONS

     Two basic energy policy options are examined in Chapter 4 of

this study:

     •  fossil fuel taxes based on the relative quantity of
        carbon emissions from each energy source; and

     •  bans on future worldwide consumption of coal, synfuels,
        and shale oil in various combinations.

The CO2 tax option is first applied to the United States to

determine the effects of unilateral actions, next to OECD coun-

tries, and finally on a global-scale to determine the need for

international cooperation.  All fuel ban policies are applied

worldwide.

     Chapter 5 discusses the nonenergy policy options for miti-

gating a greenhouse warming:  CO2 emission controls, forestation

programs for sequestering atmospheric C02, and  injecting SO2 into

the stratosphere to increase atmospheric reflectivity.  Each option

is assessed for effectiveness and feasibility.

     MEASURES OF EFFECTIVENESS

     The effectiveness of each energy policy option is measured

in terms of delaying or limiting temperature increases.  If a

policy is not effective, costs and future feasibility are of

little significance.

     The primary measure of effectiveness is the number of years

a particular option delays a temperature increase of 2°C.  A 2°C

temperature rise was selected because it represents a global

warming significantly beyond the historical change for any 120

-------
                               1-17






year period, and one guaranteed to produce substantial  climatic



consequences.  As noted earlier in this chapter, 2°C  is signifi-



cant in comparison with temperature changes that produced  ice ages.



Moreover, a 2°C change by the middle of the 21st century would



produce an average warming of about 0.3°C per decade.   During



the past 100 years, the average change has been only  0.04°C per



decade.  In addition, temperature serves as a useful  indicator



of changes  in overall climatic conditions (e.g., storm  frequency,



precipitation, wind direction), which are largely determined by



spatial temperature gradients.



     A secondary measure of effectiveness is how much the esti-



mated temperature  in the year 2100 is lowered.  Because these



estimates span a far longer time frame, the conclusions they



support are substantially more speculative than conclusions based



on a 2°C temperature change.



     Earlier studies examining possible options to reduce the rise



in CO2 focused primarily on the steps necessary to prevent a doubling



of pre-industrial  levels of atmospheric CO2 (Nordhaus,  1977).  In



addition, most climate models have been employed to estimate the



temperature effects of doubled atmospheric CC>2 •  The different



focus here — the  timing of a 2°C temperature change  rather than



a doubling  in CO2  — offers several advantages.  First, it allows



other greenhouse gases and their effects on temperature to be con-



sidered as part of the analysis.  Second, it allows the range of

-------
                               1-18






current uncertainty in predicting temperature change (3.0 +_ 1.5°C)



for doubled CC>2 levels to be incorporated into the analysis.



Third, it highlights the significance of time lags between CC>2



and temperature rises.  Finally, it shifts attention away from



what has become simply a convenient convention for analysts to a



more meaningful measure of the greenhouse effect — global



temperature.



     Measures of effectiveness employed in the analysis of non-



energy strategies are less specific, largely because our findings



are extrapolated from other studies.  In general, we compared



either projected annual reductions in CC>2 with current emission



rates, or projected reductions in temperature with expected



CC>2-induced increases.



     MEASURES OF FEASIBILITY



     If a policy is to prove desirable, it must be technologically,



economically, and politically feasible, in addition to being



effective.  Unlike effectiveness, no simple and direct measure



exists to determine the feasibility of the policy options examined



in this study.  The world energy model used in the study does not



contain a sophisticated enough structure of regional economies nor



complete enough representation of cost factors in the energy sector



to provide a reliable basis for evaluating economic feasibility.



In addition, considerations of international cooperation fall far



beyond the model's scope to support an evaluation of political

-------
                               1-19






feasibility.  As an alternative analytical approach, Chapter 6



of this study uses a series of examples to illustrate the potential



economic and political ramifications of adopting policies that



limit fossil fuel use.






FINDINGS AND CONCLUSIONS



     Finally, Chapter 7 brings together the previous discussions



of effectiveness and feasibility and presents a summary of findings



and conclusions.  It also highlights critical uncertainties and



areas for future analysis.

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                            CHAPTER 2



            SCIENTIFIC BASIS FOR A GREENHOUSE WARMING






     This chapter discusses the scientific evidence linking



increases in carbon dioxide and other greenhouse gases to climatic



change.  Although many aspects of this linkage need to be further



resolved and clarified, much is now known from past and ongoing




research efforts.






ROLE OF GREENHOUSE GASES



     The temperature of the earth is determined by a balance be-



tween the radiation it absorbs and emits.  By reflecting or



absorbing and then reradiating certain wavelengths of the sun's



radiation as it enters the atmosphere, some atmospheric consti-



tuents  reduce the amount of energy reaching the earth's surface



and thus decrease global temperature,  volcanic aerosols and



certain forms of particulate matter are examples of atmospheric



components  with these  characteristics.



     Other  atmospheric components, commonly referred to as green-



house gases, have the  opposite effect.  These gases allow visible



and ultraviolet radiation  from the sun to penetrate to the planet's



surface, but absorb some of the  infrared energy that is reradiated



from the earth.   In a  sense, greenhouse gases form a "thermal



blanket" around the earth.  As these gases increase in concentra-



tion,  incoming  radiation temporarily exceeds that leaving the



earth.   In  reestablishing  a radiation balance, the earth-atmos-



phere  system  increases in  temperature.

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                               2-2


     Several gases found in the atmosphere exhibit the properties

of a greenhouse gas.  Carbon dioxide is the most abundant and best

known.  Other potentially significant greenhouse gases include

methane, nitrous oxide, and chlorofluorocarbons.  In addition,

water vapor demonstrates a sizable greenhouse effect.  Thus,

increasing levels of water vapor from evaporation and melting,

which will accompany a CO2~induced global warming, further

enhance the greenhouse effect.

     Because of the complexity of the natural systems involved,

experiments to further test and clarify the greenhouse effect

are not feasible.  In fact, the only meaningful field experiment

that could be conducted is the uncontrolled one now taking place

as we burn large quantities of fossil fuels.  The nature of this

experiment was best expressed in an early article written by

Revelle and Suess in 1957:

     ....Human beings are now carrying out a large-scale
     geophyscial experiment of a kind that could not have
     happened in the past, nor be repeated in the future....
     The experiment, if adequately documented, may yield a
     far-reaching insight into processes determining weather
     and climate....

The challenge facing researchers and policymakers today is to

determine a course of action in which we maintain the flexibility

to respond in a timely and effective manner as this ongoing

experiment unfolds.

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                               2-3






     There are, however, at least two approaches to obtaining



insights into how increases in greenhouse gases might affect



atmospheric temperature and climate.  First, we can investigate



the relationship between the chemical composition and temperature



of the atmosphere surrounding different planets for clues of how



greenhouse gases influence temperature.  Second, global climate



models can be manipulated to simulate the climate of a world



with higher levels of atmospheric CC>2.



     COMPARISONS WITH OTHER PLANETS



     Recent space probes to other planets have provided informa-



tion on atmospheric composition and temperature that substantiates



the greenhouse theory.  From them, we have learned that the



atmosphere of Venus is composed of approximately 97 percent carbon



dioxide, and its surface temperature is about 700°K.  In contrast,



the atmosphere of Mars contains only a small amount of CC>2 and



therefore does not block the escape of infrared radiation. Its



temperature is approximately 220°K. The earth's atmosphere



contains about 0.03 percent CC>2 (and more water vapor than Venus or



Mars),and its observed temperature is 288°K.



     Taking into account differences in solar radiation received



by these planets and differences in their albedos (i.e., ground



and cloud cover, which influences the reflectivity of the planet's



surface), their estimated surface temperatures based on the hypo-



thesized effects of greenhouse gases are very close to observed



values.  Although this analysis by analogy falls far short of



verifying estimates of future atmospheric warming on earth, it



does provide fundamental evidence supporting the validity of



the greenhouse theory.

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                               2-4





     EVIDENCE FROM CLIMATE MODELS



     Efforts are now under way to better understand the rela-



tionship between atmospheric composition and temperature on our



planet.  The principal approach involves developing mathematical



models of the geophysical conditions that produce global climate.



To various degrees of complexity, these models simulate radiation



from the sun as it penetrates the various layers of the atmosphere,



the distribution of energy over the earth's surface, the radiative



effects of greenhouse gases, the effect of the earth's albedo,



reradiation of energy from the earth back into the atmosphere,



and the flux of heat from the atmosphere to the earth and into



the oceans -- all of which interact to produce circulation and



climate patterns within our atmosphere.



     In effect, the more elaborate three dimensional general cir-



culation models (GCMs) represent, in simplified mathematical form,



the physical processes that combine to create short-term weather



patterns.  These patterns, over time, produce climate.  The most



advanced of these models provide output for time intervals as



short as 15 minutes and for relatively small areas (thousands of



square kilometers).  In contrast, relatively simple one-dimensional



radiative-convective models (referred to as 1-D RC models) can



be used to calculate long-term trends in globally averaged temper-



ature changes.

-------
                               2-5





     Despite the complexity of the tasks, climate models have



demonstrated considerable accuracy.  For example, a National



Academy of Sciences (NAS) review of these models concluded that



attempts at recreating existing climate patterns have produced



"a reasonably satisfactory simulation of the present large-scale



climate and its average seasonal variation" (Smagorinsky, 1982).



In addition, consistency has been demonstrated both among different



GCMs, and between GCMs and 1-D RC models.  These models have also



successfully recreated past climates.



     In 1979, and again in 1982, NAS reviewed the state-of-the-art



in climate modeling.  It concluded that temperature could rise



3.0 _+ 1.5°C for a doubling of preindustrial atmospheric CO? levels



(Charney, 1979; Smagorinsky, 1982).  These conclusions were based,



in part, on the experimental results of two GCMs that pre-



dicted a 2°C change (Manabe, 1980) and close to a 4°C increase



(Hansen, 1983) with a doubling of CC>2 •



     The differences in these results can be explained by examining



how each of the models treats various components and feedbacks of



the climate system.  Specifically, the Hansen model shows a small



increase in mean cloud height and a slight decrease in cloud



cover for runs with doubled CC^.  Both of these feedbacks increase



convective warming, and in so doing increase temperature approxi-



mately 1.3°C.  In contrast, the Manabe model holds cloud altitude



and cover constant.  The two models also differ in their treatment



of heat transport by the oceans and changes in sea ice.

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                               2-6






     Climate models provide an essential analytical tool for



understanding the potential changes in climate brought about by



increases in greenhouse gases.  Their usefulness is likely to



increase over time as the models are further refined and as



existing uncertainties are reduced.  Critical areas requiring



more sophisticated treatment  include the storage and transport



of heat by the oceans, the role of clouds in determining climate,



and possible changes to clouds as the earth warms.  To improve



these components of climate models, additional observational



efforts will be required to close existing gaps in data bases.



     The deficiencies in and disagreements among climate models



described above should not obscure the large amount of useful



information and the extent of agreement that exists in this



field.  In the absence of unambiguous empirical evidence of the



relationship between atmospheric CC>2 and temperature, climate



models provide the next best tool for characterizing this



relationship.






TIMING OF TEMPERATURE RISE



     To date, GCMs have not been used to estimate the timing of



global warming or climatic change.  Instead, these models have been



run assuming that atmospheric levels of C02 have doubled and that



temperature has reached its equilibrium level.



     The actual nature of the warming process will be quite dif-




ferent.  Additional emissions of CC>2 will cause atmospheric con-



centrations of this gas to increase gradually and continually.

-------
                              2-7





Futherraore, due to the capacity of the ocean to absorb and dis-



tribute the heat produced by the greenhouse effect, temperature



rises should lag CO2 increases by several decades  (Smagorinsky,




1982).  A proper accounting of the transitional period, as CC>2



levels increases, must consider nonequilibrium conditions and



time lags due to the carbon cycle and heat exchange processes.





THE ORIGIN AND EXCHANGE OF CO2 IN THE ENVIRONMENT



     Unlike the uncertainty surrounding climate model estimates,



the trend in atmospheric CCU levels since the Industrial Revolu-



tion is well documented.  Around 1890, at the beginning of the



industrial period, atmospheric concentrations are estimated to



have been in the 280 to 290 ppm range (Barnola, 1983).  Precise



measurements of atmospheric CO2 were initiated at Mauna Loa, Hawaii,



in  1958  (see Figure 2-1).  At that time, these readings registered



CO2 levels of 315 ppm or approximately a 12.5 percent increase



since the 1890s.



     The most recent readings place CC>2 levels at  339 ppm, an



additional 7 percent increase in just over 20 years (Keeling,



1982).  This increase is due in large part to the approximately



160 gigations of CC>2 emitted from fossil fuel consumption since



1900  (Rotty, 1983).  Although not all of those emissions have



remained in the atmosphere — considerable controversy surrounds



this question -- a large percentage has.

-------
                                 2-8
                              FIGURE 2-1



    MONTHLY ATMOSPHERIC  CARBON DIOXIDE  CONCENTRATION AT  MAUNA

                           LOA OBSERVATORY*
 E
 Q.
 o
 c
 a>
 u

 O
 o

  CM
 O
 O
      340 -
      336
      332
      328
324
      320
      316
      312
           j	I
                        I
         1958   1960   1962   1964  1966  1968  1970  1972  1974  1976  1978   1980
*Seasonal  effects have been  normalized.


Source:  CEQ (1981), based on data derived  from Keeling,  Scripps

 ,        Institute of Oceanography.

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                               2-9






     THE CARBON CYCLE; PAST, PRESENT AND FUTURE



     Figure 2-2 depicts the stocks of carbon in each natural



reservoir and the annual flows that take place among reservoirs.



Taken together, these stocks and flows constitute the carbon cycle.



Carbon distributed through this cycle plays an important role in



the ecological balance of the atmosphere, biosphere, and oceans.



     Fossil fuels are merely preserved forms of carbon (and other



elements) previously created in the biosphere.  Thus, burning



fossil fuels simply redistributes carbon from one reservoir to



another.  In effect, however, it represents a substantial new



flow due to man's activities alone.  Carbon stored over hundreds



of thousands of years in fossilized forms may be released into



the atmosphere in a matter of a few centuries.



     Carbon also enters the atmosphere through deforestation.



Exact estimates of the magnitude of the flow vary because of a



lack of  consensus regarding the amount of carbon stored in the



soil and rivers, and the countervailing rates of deforestation



and reforestation.  Early estimates suggested that changes in



land-use patterns released as much as 20 gigatons of carbon



annually during this century (Woodwell, 1978).  Recent estimates



have lowered that figure considerably, with some researchers now



suggesting that changes in land use offset each other (defore-



station and reforestation), resulting in no net increase in atmos-



pheric carbon  (Olson, 1982).

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                                 2-10


                              FIGURE  2-2

             EXCHANGEABLE CARBON RESERVOIRS AND  FLUXES
                                Atmosphere
711 (335 ppm of C02)
'
l t I

'


5 56 56 2-3 90 90


I I

12,000
(7,500
ultimately
recoverable)






1,760

1

, ,
'

Fossil fuels Terrestrial
and shales biosphere




.
580

38,400

-




Surface

Intermediate
and deep
Oceans
      Reservoirs in 10 metric tons

      Fluxes in 10 metric tons/year
Source:  CEQ (1981), as  shown in World  Meteorological  Society,
         "Report of the  Scientific Workshop on CO2," Report
         474,  Geneva 1977.

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                               2-11


     FRACTION OF CO? FROM FOSSIL FUELS THAT REMAINS AIRBORNE

     The amount of carbon emitted from fossil fuels retained in

the atmosphere is critically important to the pace and magnitude

of global warming.  This percentage is called the airborne frac-

tion or retention ratio.  If the airborne fraction is high, more

CO2 emitted into the atmosphere will remain there, and climatic

change is likely to occur sooner than if it is low.  Scientists

have used recent data on worldwide fuel usage, rates of defores-

tation and reforestation, and increases in atmospheric CO2 to

obtain an estimate of 0.4-0.6 for the historic airborne fraction

(Clarke, 1982).*

     In the future, an increasing percentage of CO2 from fossil

fuel emissions is likely to remain in the atmosphere.   This is

based on the belief that the top layers of the ocean,  which serve

as the primary repository of carbon not retained in the atmosphere,

will become saturated.  Moreover, as temperatures rise, the capa-

city of the ocean to absorb C02 is diminished.  On the other hand,

rising CO2 may stimulate plant growth thus enhancing the biosphere's

carbon retention capacity.
*  Considerable uncertainity exists concerning the historic atmos-
   pheric levels of C02.  Researchers are unsure of the contribu-
   of past deforestation.  To the extent that deforestation has
   been significant, its contribution to airborne CO2 would be
   higher than previously estimated, and the fraction of fossil
   fuel emissions retained in the atmosphere consequently lower.

-------
                              2-12





     Given these uncertainties, one recent estimate of the likely



future airborne fraction concluded that it would fall somewhere



within the 0.38 - 0.72 range.  If existing carbon cycle models




are accurate, the actual fraction is likely to be closer to the



higher level of that range (Oeschger, 1983).






INCREASES IN OTHER GREENHOUSE GASES



     Human activities may also be responsible for increasing the



atmospheric content of other greenhouse gases.  These gases are



principally nitrous oxide, methane, and chlorof luorocarbons.



Although they have generally received less attention and are



present in the atmosphere in smaller concentrations than CO2



(and are sometimes called "trace gases"), their increase may



contribute significantly to global warming.



     NITROUS OXIDE
     Nitrous oxide (^O) emissions result primarily from biological



dentrif ication processes in soil and in the oceans.  By increasing



the use of nitrogen fertilizers and by adding nitrogen-rich sewage



to water bodies, we are indirectly adding nitrous oxide to the



atmosphere.  Measurements of ^0 concentrations from 1970 to 1980



show an increase of 6 parts per billion (ppb) to a level of 295



ppb (Lacis, 1981).  Estimates suggest that a doubling of nitrous



oxide would directly increase temperature by 0.30-0.44°C ( Donner



and Ramanathan, 1980; Wang and Sze, 1980).

-------
                              2-13






     In addition, increases in N2O may indirectly contribute



to an even greater warming.  Through various reactions with




other gases in the atmosphere, greater amounts of ^O may lead



to higher levels of ozone in the lower stratosphere and upper



troposphere.  Wang and Sze have calculated that the resulting



indirect greenhouse warming could raise temperature another



0.18°C for a total increase of 0.48-0.62°C due to a doubling



of N2O (Wang and Sze, 1980).



     As greater demands are placed on world food supplies,



increased use of nitrous oxide-producing fertilizers is likely.



However, because the natural sources and sinks of this trace gas



are not well understood, more research is required before reli-



able projections can be made of future levels.



     METHANE



     Methane (CH^), is a second important trace greenhouse gas.



The known sources of CH4 are anaerobic fermentation in rice fields



and swamps, and enteric fermentation from termites, cows, and other



animals.  As the need for food from livestock and rice fields



increases over time, atmospheric levels of CH^ are likely to



increase.  In addition, increases in carbon monoxide (from fuel



combustion) in the troposphere will lower the concentration of



compounds that destroy methane.  Based on current estimates of a



2 percent per year increase in concentration, by the middle of



the next century CH4 could increase global warming by about 0.2-




0.3°C  (Lacis, 1981).

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                               2-14






     Future increases in methane could, however, be far higher



than the estimated 2 percent per year of the recent past.  As



the earth warms, extensive peat bogs containing as much as 2000



gigatons of CH4 in the form of methane hydrates now frozen in



northern latitudes may thaw, releasing considerable quantities



of this gas into the atmosphere.  While much of this methane is



buried 250-1,000 meters under the ground and therefore, unlikely



to be released for several centuries, a contribution of eight



gigatons per year from methane nydrates under shallow water is



possible within the next 100 years (Bell, 1982).



     CHLORQFLUOROCARBQNS



     Entirely a product of human activity, chlorofluorocarbons



have only recently appeared in significant quantities in the



atmosphere.  Although the shift away from gas-propelled spray



cans in many countries reduced one important source of CFCs,



they are still used in refrigeration equipment and insulated



packaging materials.



     Based on the known rates at which CFCs are destroyed in the



stratosphere, one study estimated that the direct effects of CFCs



should increase temperature by approximately 0.3°C if annual



production were maintained at 1973 levels (Wang and Pinto, 1980).



This estimate is probably high, since CFCs reduce the concentration



of ozone, another greenhouse gas.  On the other hand, future emissions



of CFCs may be higher or lower than 1973 levels depending on



the effects of the U.S. ban on aerosol propellants, and the extent



to which a ban is applied to other uses and in other countries.

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                               2-15






     COMBINED TEMPERATURE EFFECTS;  1970-80



     Researchers at the Goddard Institute for Space Studies used



a one-dimensional radiative-convective model to estimate the



temperature increase from the rise in CC>2 and other greenhouse



gases during the 1970s.  They assumed the temperature rise for a



CO2 doubling was 2.8°C.  For this ten-year period, they found



that temperature increased a total of 0.24°C.  Of that increase,



0.14°C was attributed to a 12-ppin rise in CO2«



     The researchers attributed the remaining 0.10°C to the other



greenhouse gases (N2O, CH4, and CFCs) included in their analysis.



Given the uncertainties in their analysis, they concluded that



the other greenhouse gases were responsible for an additional



50-1QO percent of the temperature rise which resulted from in-



creases in atmospheric CC>2 alone (Lacis, 1981).  (See Figure 2-3.)



Other investigators have reached similar conclusions (Ramanathan,



1980; MacDonald, 1982; and Chamberlain, 1982).





POSSIBLE EFFECTS OF A WARMER EARTH



     If climate models prove accurate, changes in world climate



are likely to occur at an unprecedented rate.  All human activi-



ties are likely to be in some way affected.  Farming, transpor-



tation, coastal habitation, and the provision of water supplies



are the most obvious.  Some nations are likely to benefit from



changes in climate; others will suffer.  The same dichotomy will



generally be true for areas within countries.

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                               2-16





     However, even the areas that will benefit from changes in



climate may experience difficulties during a transitional period.



For example, if precipitation were to increase in the Colorado



Basin, the Southwest would certainly benefit in the long run.



But, these benefits could only be fully realized if water storage



and control facilities were constructed to accommodate different



monthly patterns of precipitation and runoff.  The 1983 flooding



and resulting economic losses in the Colorado Basin are a case



in point.



     Estimates of what the world's climate will be like if CC^-



induced increases in global temperatures occur have been derived



primarily from two sources: paleoclimatic evidence and general



circulation models.  Although both of these sources have their



shortcomings, they provide useful insights into possible regional



climatic changes accompanying different levels of a global warming.



     RECONSTRUCTING PAST CLIMATES



     Paleoclimatic studies attempt to reconstruct historical



climatic conditions using a variety of methods, including analysis



of tree rings and ice core samples, and carbon dating techniques.



By piecing together various clues, paleoclimatic analysis provides



useful indications of past regional climatic conditions when global



average temperature was warmer.

-------
                                  2-17
                               FIGURE 2-3
                 TEMPERATURE  INCREASES FOR  SEVERAL
                      GREENHOUSE  GASES (1970-80)
      0.2
   to,
      0.0
                      Equilibrium  Greenhouse  Warmings
                         Of Gases Added in I970's
                 0.14
                                      Sum = 0.10
                                               0.034
                                     0.016
                                                          0.020
                 C02       CH4       N20      CCI2F2     CCI3F
               (•HZppm)    (tlSOppb)   (+6ppb)    (-H90pp!)  (+I35ppt)
                   Equilibrium greenhouse warmings for estimated  1970-
           1980 abundance increases of several trace gases, based  on
           climate model with sensitivity ~3°C for doubled C02
SOURCE:  Lacis, 1981

-------
                               2-18


     One important advantage of this approach is that interactions

within the complex systems that determine climate can be examined

as a whole.  Unlike experiments using climate models, this approach

includes all factors that influence climate.

     It does have its drawbacks, however.  Like most field experi-

ments, it is impossible to control for individual variables.  All

we generally know about the time period being studied is that

global temperature was warmer.   Often we lack information required

to fully understand the cause or causes of warmer climates in the

past.  Without this knowledge,  we must assume that, whatever

forces produced the climate, the effects are similar to those

caused by increases in greenhouse gases.  Also,  the record is far

from complete; estimates are missing for many regions at various

points in time.

     An additional problem in using paleoclimatic studies to pre-

dict future climate patterns arises because of past shifts in

sea level, in the location and  size of mountains, and in other

geomorphological features that  significantly influence regional

climatic patterns.

     Despite these drawbacks, paleoclimatic studies can be a

useful analytic tool:

     •  to show that significant changes in local conditions
        (e.g., an ice-free Arctic) have accompanied relatively
        small shifts in past climates; and

     •  to identify relationships between global conditions
        and local phenomena, and to assist in filling in
        details concerning the  possible range of impacts
        accompanying a global warming.

-------
                               2-19






     Within the range of possible CO2~induced temperature changes



reported by the NAS (3.0 +_ 1.5°C), several geologic periods have



been identified as possible climatic analogies.  An extensive



analysis of these periods has been conducted by Herman Flohn



as part of his work for the International Institute for Applied



Systems Analysis.



     Flohn examined the early Middle Ages, about 1,000 years ago,



as an example of a time when global temperatures exceeded current



temperatures by approximately 1°C.  Using paleoclimatic techniques,



Flohn found that the treeline during this period had advanced



considerably farther north in Europe and Canada, that Vikings had



settled on southern Greenland, and that frequent droughts affected



Europe.



     If the average global temperature increases by 2.5°C, Flohn



suggests regional climatic conditions might be similar to those



experienced during the last interglacial period, 120,000 years



ago.  During this period, the oceans were 5-7 meters higher than



today's.  As a result, the sea substantially inundated the shore-



lines of Europe and western Siberia, and Scandinavia became an



island.



     Finally, Flohn examined the time just before the current



glacial-interglacial period, approximately 10 million years ago,



when the global temperature was 4°C warmer.  During this period,



evidence suggests that the Arctic was ice-free, while the eastern



Antarctic continent still remained covered by glaciers.  The

-------
                               2-20





resulting imbalance between an ice-free Arctic and an ice-bound



Antarctic dramatically affected regional climatic patterns.  It



caused the arid areas of the Southern Hemisphere to expand toward



the equator, and it extended the arid belt in the Northern



Hemisphere.  In general, Flohn predicts that a 4°C warming would



shift the earth's climatic zones northward by 400-800 kilometers.




     MODELING FUTURE CLIMATES



     Although the results of GCMs are far more accurate when dis-



cussed in terms of global averages, several broad conclusions about



regional climatic changes can be drawn from recent experiments.



     First, because of melting ice, increased water vapor, and



the resulting change in the earth's albedo, far more dramatic



temperature changes will occur at the poles than at the equator.



For example, where average global temperatures are estimated to



increase by 3°C, the projected change at the poles is 10°-12°C,



and less than 3°C at the equator.  Since the temperature differ-



ential between the equator and the poles is a primary driving



force behind regional weather patterns, a change of this magnitude



could dramatically alter current weather conditions.



     A second conclusion based on GCM experiments involves shifts



in precipitation patterns.  While it is not clear exactly which



areas will become dryer or wetter, significant departures from



current patterns are projected.  Overall, it appears likely that



both evaporation and precipitation will increase worldwide



(Smagorinsky, 1982).  Preliminary results from region specific

-------
                               2-21






climate modeling suggests that time patterns of precipitation




and evaporation may be far different as well (NASA,  1983).   Major



changes in monthly precipitation, runoff, and soil moisture  would



hold profound implications for agriculture and water resources



planning.






DETECTING A FUTURE GREENHOUSE WARMING



     The greenhouse theory, with GCM experiments and paleoclimatic



studies in support of  it, offers convincing evidence for the



likelihood and potential  impact of changes in climate  induced by



CC>2 and other greenhouse  gases.  However, despite the  useful



information produced by experiments and field studies, much



uncertainty remains.



     Given the complexity of the climatic system, detecting  a



change in global climate  and attributing it to increases in



atmospheric greenhouse gases is difficult.  Yet, because of  the



potentially high costs and large-scale disruptions involved  in



responding to the threat  of climatic change, policymakers.seek



a  clear signal that increases in CC>2 and other gases are directly



responsible for warmer temperatures.  Simply detecting a future



warming trend will not be enough.  It must be convincingly attri-



buted  to the greenhouse effect.



     As a prelude to this future task, recent efforts  have been




aimed  at explaining the historic variability in climate and  at



isolating that portion that might be attributed to rising levels

-------
                               2-22


of greenhouse gases.  These efforts have focused on identifying

the effects on temperature of various factors, including increases

in greenhouse gases, the frequency of volcanic eruptions, and

changes in solar radiance.

     Hansen and his associates used a one-dimensional model to

isolate the effects of CC>2 — compared with those of other factors

— on global warming experienced since 1880 (Hansen, 1981).  As

Figure 2-4 indicates, estimates of atmospheric temperature due

to CC>2 alone do not match observed temperatures very well.  With

the addition of the changes in volcanic activity and solar radiance

during this period, the fit improves substantially.  Hansen1s

study suggests that since the 1880s, CC>2 increases are responsible

for a 0.4°C increase in temperature.*

     This analysis is one of the first attempts at developing a

better understanding of the variations in historical temperatures.

Only by isolating CO2~induced changes from other factors affecting

temperature will scientists be able to develop a conclusive case

in support of global warming due to CC>2 and other greenhouse gases.


SUMMARY

     This chapter highlighted evidence both of the potential

magnitude of a greenhouse warming and of the critical importance

of resolving existing uncertainties.  There is no doubt that
*  A comparable method has been used with similar results by
   Gilliland (1982) and Budkyo, et al. (1969).

-------
                                 2-23


                             FIGURE 2-4

           MODELED VERSUS  OBSERVED TEMPERATURE TRENDS
                       Observotions
                       Model
                                  CO? + Volcanoes
                                       + Volcanoes + Sun
            I860   1900     1920     1940   I960    1980
                   Global temperature  trend computed with a climate
          model with sensitivity 2.8°C for doubled C0£ and an
          exchange  rate K - 1.2 cm2 s"1 between a 100-m mixed layer
           ocean and  the thertnocline.
Source:   Hansen (1981).

-------
                              2-24





atmospheric C02 levels have increased and will continue to rise



as long as the world remains dependent on fossil fuels.  Models



that estimate the climatic effects of this change in atmosphere,



along with increases in other greenhouse gases, are by no means



exact, but provide strong evidence of the likelihood of unprece-



dented rates of temperature increases during the next 120 years.



Based on the strength of what we now understand about the green-



house effect, and the social and economic implications of such



climatic change, extensive research efforts aimed at addressing



the remaining unknowns and at evaluating response options appear



to be warranted.

-------
                            CHAPTER 3

                    METHODOLOGY FOR PROJECTING
                 FUTURE ENERGY AND CO? SCENARIOS


     Increases in CO2 will depend on both the total amount of

energy demanded and the mix of fuels employed to satisfy energy

demands.  The importance of fuel mixes is reflected by differences

in the amount of CO2 emitted by alternative fuel types, from a

high of 47.6 terragrams of carbon/EJ (1.02 million tons/quadrillion

Btus) for shale oil to zero net emissions for biomass, solar, and

nuclear fuels.  Thus, two basic energy strategies for limiting or

slowing the rise of CO2 present themselves—reduce the total

demand for energy, and shift the fuel mix toward fuels with low

CO2 emission coefficients.

     To evaluate the effectiveness of energy-based policies in

slowing or limiting the rise in atmospheric C02» we developed a

methodology for projecting patterns of energy use, estimating

future CO2 emissions, and translating emissions into atmospheric

CO2 concentrations and temperature increases.  This methodology

relies heavily on a set of computerized models for manipulating

data and simulating relationships.  The primary components of

the methodology and the key characteristics of the individual

models are depicted in Figure 3-1.

     This chapter describes each step in the method including

the key features of each model.  It emphasizes the assumptions

and parameter values used to initialize model runs, since the

-------
                3-2


             FIGURE 3-1

         STUDY METHODOLOGY
Project Energy Use and CO? Emissions

   •  Estimate Changes in Population
       and Productivity

   •  Estimate Fuel Costs and Demand
       Elasticities

   •  Estimate CO2 Emission Rates

   •  Estimate Energy Efficiency
       Improvements and Other Parameters

   •  Run IEA Energy/CO2 Model
  Project Atmospheric CO? Levels
        Run ORNL Carbon Cycle Model

        Select Representative Time
         Series of Atmospheric
         Retention Ratios
 Project Atmospheric Temperature

    •  Estimate CO2 - Temperature Sensitivity

    •  Estimate Thermal Diffusivity

    •  Project Concentrations of Other
        Greenhouse Gases

    •  Run GISS Temperature Model

-------
                               3-3






confidence placed in our findings depends on the reasonableness



of these assumptions and values.  The sensitivities of model



outputs to the most important assumptions are described in



Chapter 4.



     A general discussion of energy supplies and technologies  is



presented in Appendix A.  It serves as background to the more



specific treatment of energy supply modeling used in this chapter.






PROJECTING ENERGY USE AND CO? EMISSIONS



     The Institute for Energy Analysis (IEA) energy and CC>2 emis-



sion model (Edmonds and Reilly, 1983a) served as the basic vehicle



for developing alternative energy and CC>2 emission scenarios.*



The IEA model is attractive for this type of application for



several reasons.  First, it is global in scope and thus encom-



passes world energy markets and international trading in all



principal fuels.  Second, it is designed as a sketch model —



that is, as a representation of general structural relationships



between fuel supplies and energy demands.  This is highly desir-



able for a study of long-term energy supply and demand.  Finally,



the IEA model has been structured to facilitate the evaluation



of energy policy options.
*  See Appendix B for a more detailed description of the IEA model,

-------
                               3-4





     Based on a series of sensitivity analyses conducted by both



Edmonds and Reilly, and us, the model also appears to be highly



robust.  That is, it is not overly sensitive to any single para-



meter or assumption.  This is due, at least in part, to the



use of logit share equations and the resulting continuity of



change in market fuel shares.  In other words, the market



responses to major changes in prices, supplies, and demand are



modulated and lagged.



     The IEA model divides the world into nine geopolitical



regions (Figure 3-2).  Population, economic growth, energy supply



and demand, and all other key variables are specified for each



of these regions.  The model estimates prices for each fuel in



each region sufficient to balance supply and demand at each



future point in time (currently, 1975-2100 in 25-year intervals).



Interregional trading in all fuels except electricity (for which



no world market exists) is simulated as part of the market price



solution process.  The total quantity of CC>2 emitted is calculated



from the worldwide consumption of the various fuels and the CO2



emissions coefficients of each fuel.  Figure 3-3 depicts the key



inputs and outputs and the major computational pathways in the



IEA model.



     Although the basic structure of the IEA model was not modi-



fied for this study, many of the parameter values and assumptions



were altered to specify new baseline energy and policy scenarios.



To emphasize these changes, we will refer to our runs as IEA/



EPA scenarios.

-------
                                                          3-5


                                                     FIGURE  3-2

                                 GEOPOLITICAL  REGIONS  IN  THE  IEA  MODEL
Key:

1. U.S.A.
2. OECD WEST (Canada and Western Europe)
3. JANZ (Japan, Australia and New Zealand)
4. EUSSH (Eastern Europe and USSR)
5. ACENP (Asian Centrally Planned)
6. WIDEST (Middle East)
7. APR (Africa)
8. LA (Latin America)
9. SEASIA (South and East Asia)

-------
                                         3-6

                                      FIGURE 3-3

                              STRUCTURE OF THE IEA MODEL
                                           r
   _L
 REGIONAL
POPULATIONS
REGIONAL
LABOR
FORCES


REGIONAL
GNP
                REGIONAL
                 LABOR
                PRODUC-
                TIVITIES
TECHNO-
LOGICAL
CHANGE
                                 REGIONAL
                                TAXES AND
                                 TARIFFS
                                 REGIONAL
                                 RESOURCE
                                   CON-
                                 STRAINTS
                                REGIONAL
                                BACKSTOP
                               TECHNOLOGY
                               DESCRIPTION
              REGIONAL
              ENERGY
              DEMANDS
             REGIONAL
               PRICES
WORLD
PRICES
              REGIONAL
               ENERGY
              SUPPLIES
 GLOBAL
SUPPLIES
  AND
DEMANDS
   CO2
EMISSIONS
                                           L.

-------
                                3-7


     ENERGY DEMAND PARAMETERS

     As shown in Figure 3-3, the major determinants of energy

demand in each region are (1) population and labor force,  (2)

labor productivity, and (3) enhanced energy efficiency, on the

positive side, and energy prices on the negative side.  These

determinants work together within the economy of each region

to create the underlying demand for fuel liquids, gases, solids,

and electricity.

     Values for regional populations and gross national products

(the product of labor forces and labor productivities) used in

the IEA/EPA Mid-range Baseline scenario (see Chapter 4) are shown

in Table 3-1.  The values for 1975-2050 are based on a detailed

study of each region and are taken without change from Edmonds

and Reilly (1983b).*  Values beyond 2050 extend the 1975-2050

trends, with worldwide population reaching a zero growth level

by 2075.  In terms of growth rates, worldwide population averages

1.0 percent per year between 1975 and 2050, and worldwide GNP

averages 2.7 percent per year between 1975 and 2100.
*  The Edmonds and Reilly study combined an exhaustive review
   of the energy demand literature with specially commissioned
   investigations of population growth and productivity change
   in each of the nine regions.  See Appendix B for additional
   documentation.

-------
                                                            3-8
                                                         TABLE  3-1

                               BASELINE VALUES FOR POPULATION, GNP, AND TECHNOLOGICAL CHANGE
                                                                                                                  £/
                      Population  (billions)               GNP (trillions of 1975 $)	  Enhanced Energy Efficiency
  Region
U.S.

Canada & W.
 Europe
               1975  2000  2025  2050  2075  2100   1975  2000  2025  2050  2075  2100  1975  2000  2025  2050  2075  2100
                .21   .25   .28   .29   .29   .29   1.52  2.85  4.59  6.84 10.11 14.661

                .41   .48   .53   .55   .56   .56   1.82  3.60  6.42 10.38 16.18 24.65
Japan, Aust.,   .13   .15   .16   .17   .17   .17    .59  1.59  3.21  5.38  8.41 12.82-
 & New Zealand
-1.00  1.28  1.64  2.11  2.70  3.47
E. Europe &
 U.S.S.R.
                .40   .47   .52   .53   .54   .54    .97  1.76  2.85  4.31 13.85 21.10i
Asian Centrally .91  1.25  1.50  1.61  1.65  1.65    .32   .85  1.75  3.31 13.47 28.20
 Planned

                .08   .15   .21   .24   .25   .25    .14   .50  1.24  2.49  9.14 14.99
Mideast

Africa          .40   .70   .94  1.10  1.15  1.15    .15   .48  1.14  2.14  9.28 18.07

Latin America   .31   .54   .72   .82   .85   .85    .32  1.09  2.84  5.16 17.89 29.35

S.& E. Asia    1.13  1.90  2.56  2.89  2.99  2.99    .23   .71  1.65  3.11 11.07 21.03J
-1.00  1.11  1.26  1.44  1.68  1.99
a/ This is an index that reflects improvements in energy efficiency, in addition to those induced by
   energy price rises.  In the Mid-range Baseline scenario, it applies to only the industrial sector
   in the OECD countries, and to the single aggregate sector elsewhere.

-------
                              3-9


     Accelerated increases in GNP in the current underdeveloped

and developing regions reflect a high population growth rate

earlier in the 21st century combined with higher labor pro-

ductivity later in the century as the economies in these regions

mature.*  Viewed from a different perspective, initially high

population growth rates in these regions are brought to zero

through improvements in the standard of living as reflected in

GNP values.  This is consistent with the generally held view

that birth rates are negatively correlated with per capita GNP.

     With respect to the enhanced energy efficiency index, note

that this parameter reflects improvements in energy efficiency

beyond those induced by increases in energy prices.  Our Mid-

range Baseline scenario assumes such improvements occur only

in the industrial sector where the rate of technological innova-

tion historically has been higher than in the other economic

sectors.  The average rate of increase over the 125-year period

is 1.0 percent per year in the OECD (first three regions in

Figure 3-2) industrial sectors, and about 0.6 percent per year

in the single aggregate sector elsewhere.
*  Average annual rates of increase over the 125-year period
   range from about 2.8 percent per year to over 3.0 percent
   for the less developed countries.

-------
                               3-10


     The effect of energy prices on demand is captured in the

set of long-term (25-year) price elasticities of demand for each

region.*  For the OECD regions, the sectoral elasticities are:

-0.90 for residential/commercial, -0.80 for industrial, and -0.70

for transportation.  (The residential/commercial elasticity

accounts for the increased use of passive and active solar energy

in these sectors.)  Since the other regions are not disaggregated

by sectors, a single -0.8 elasticity is employed.  Because prices

vary individually for different fuels,  interfuel elasticities are

used to reflect the tendency for substitution among fuels.  How-

ever, these elasticities vary with the  market share of each fuel

and thus over time as the mix of fuels  changes in each region.

     Total energy demand is driven by GNP both through the con-

sumption of goods and services that require energy for produc-

tion, and through the direct consumption of energy by consumers.

These effects are summarized by income  elasticities of demand,

which are set for the OECD countries at 1.0 (with respect to

per capita income) for the residential/commercial and transport

sectors, and 1.0 (with respect to GNP)  for the industrial sector.

For the single-sector regions, the aggregate elasticity declines

from 1.25 to 1.0 in Eastern Europe and  the USSR, and from 1.4

to 1.0 elsewhere, over the period 1975-2050.  Thereafter, it
*  A price elasticity of demand is the percent change in demand
   caused by a one percent change in the mean price.

-------
                              3-11


remains at 1.0 everywhere.  The growth in GNP is also affected

by the energy price increases, but the effect is the opposite

of income changes.  The GNP-price elasticity is -0.10.

     The demand for energy is further disaggregated into fuel

types based on market shares of each fuel in 1975 and assumed

changes in fuel share parameters over time.  Market penetration

of alternative fuel types also depends on the relative prices

of these fuels, as reflected in a series of cross-price elas-

ticities.  The combination of market share parameters and fuel

price differentials controls the rate at which new energy tech-

nologies emerge and old ones are supplanted.  Thus, as noted

previously, sudden changes over any one 25-year period are

avoided.

     ENERGY SUPPLY PARAMETERS

     Three generic energy supply categories are defined based

on the physical availability of the resource:

     Resource-            Resource-        Unconstrained
     Constrained          Constrained         Sources
     Conventional         Renewable
       Sources             Sources                      	
      Conventional         Hydro            Unconventional Oil
         Oil               Biomass          Unconventional Gas
      Conventional           (Solids and     Coal  (Solids and
         Gas        :         Synthetic        Synthetic Fuels)
                            Fuels)           Solar Nuclear


 Definitions  of  each  fuel  type  can be  found in Appendix A.

-------
                               3-12


     The rates of production of conventional oil and gas are

represented by simple resource depletion curves.  This assumes

that the rates of oil and gas extraction over the next few decades

follow historical trends and are insensitive to changes in market

prices.  Although this assumption is not literally valid and

leads to some distortion in estimated oil and gas prices, the

inaccuracies are mitigated since conventional oil and gas will

have become relatively minor sources of energy by the middle of

the next century — well within our time frame.

     Hydropower for generating electricity is modeled in a fashion

similar to unconventional oil and gas, with one exception.  Rather

than resource depletion, maximum resource utilization is simulated.

Biomass is both resource-limited and price-sensitive.  That is,

maximum land areas for growing fuel crops have been estimated

for each region, and these limits bound a land area-energy price

supply curve.  Upper limits on the amount of waste available for

use as fuel are estimated as a function of GNP in each region.

     All other fuels are assumed to be present in large enough

quantities as to be inexhaustible within the time horizon of

this study.*  Production of these fuels is thus influenced only

by their market price.  However, a distinction is made between
*  For nuclear power, the development and use of breeder reactors
   is assumed.  See Appendix A for further elaboration.

-------
                               3-13


unconventional oil (primarily shale oil),* unconventional  (deep)

gasf and coal, on the one hand, and nuclear and solar on the

other.  The first group is assumed to follow both a long-run

"normal" rate of growth (which occurs at constant real prices)

and a shorter (25-year) supply schedule that adjusts the produc-

tion level above or below the "normal" level corresponding to

higher or lower than "normal" prices.

     Both nuclear and solar-electric** power are considered true

"backstop" fuels.  That is, their costs of production remain

constant (or decrease) for all time scales.  Moreover, the demand

for these fuels is derived from the total demand for electricity,

and the costs of producing electricity from nuclear and solar

power relative to competing fuels.

     The demand for and market price of liquids and gases similarly

influences the production of synthetic fuels from coal and biomass,

although synfuels are modeled by a logit-share function, rather

than by superimposition of long- and short-run supply schedules

as  above.
*  Unconventional oil  includes both heavy oil and tar sands/shale
   oil  (see Appendix A).  However, although the IEA/EPA model
   runs  include all types of unconventional oil in their resource
   estimates, production costs are based on shale oil costs.

** Solar for nonelectric uses is  included in the IEA conservation
   category.

-------
                               3-14


     A key production parameter for all emerging energy sources

is the minimum production cost, or breakthrough price.  This is

the lowest market price at which any production is feasible.*

Breakthrough prices are shown in Table 3-2 for each emerging

energy source in the IEA/EPA Mid-range Baseline scenario.  Note

that the price for each source, other than unconventional gas,

declines over time (a smooth nonlinear curve connects 1975 and

2100), reflecting technological advances in extraction and pro-

cessing technologies.  Since unconventional gas is currently

being produced in several parts of the world (and is thus not

actually an "emerging" source), the associated technology can

be considered mature and subject to a modest increase in real

costs over time.

     For purposes of comparison, breakthrough prices for the

other principal fuel types are shown in Table 3-3.  These cost

estimates include pollution control and other nonenergy costs.

They are based on the results of an energy technology comparison

as reported in Reilly and associates (1981), with extrapolations

to 2100 and with modifications based on more recent cost data.
*  For synfuels, the "breakthrough price" concept is not directly
   applicable.  Production costs relative to market prices for
   liquids and gases are used to determine the relative amounts
   of liquid, gaseous,  and solid fuels made from coal and biomass.
   A small amount of synfuel production may occur even when market
   prices are slightly below production costs.

-------
                                            3-15


                                         TABLE 3-2

             BREAKTHROUGH PRICES FOR EMERGING ENERGY SOURCES IN THE MID-RANGE
                                     BASELINE SCENARIO
       Fuel"
           a/
                 Breakthrough Price (1980 $)

Beginning (1975)          Final (2100)        Production Initiated
Unconventional Oil
(primarily shale)

Unconventional Gas

             c/
Synthetic Oil
             c/
Synthetic Gas"
Centralized Solar-
 Electric
12.0 - 17.8  ($/GJ)
 70  - 103   ($/boe)

  5.2 ($/GJ)
0.005 ($/cf)

  100 ($/GJ)
  580 ($/boe)

  100 ($/GJ)
 0.10 ($/cf)

    153-570" ($/GJ)
2.32 - 8.63  ($/kWh)
                          7.1 ($/GJ)
                           41 ($/boe)

                           6.4  ($/GJ)
                         0.006  ($/cf)
                           6.7
                            39
($/GJ)
($/boe)
                           5.0 ($/GJ)
                         0.005 ($/cf)
                                 b/
                             9-22  ($/GJ)
                         0.29-0.33  ($/kWh)
  8.8 ($/GJ)
   51 ($/boe)

  5.5 ($/GJ)
0.006 ($/cf)

    7 ($/GJ)
    41 ($/boe)

  5.5 ($/GJ)
0.006 ($/cf)

   20 ($/GJ)
 0.30 ($/kWh)
a/ See Appendix A for definitions.

b/ Varies by region.

£/ Synthetic fuels are not, strictly speaking, modeled with breakthrough prices.
   Rather, the production costs are used together with other factors to estimate
   the fractions of raw material (coal and biomass) that are used to produce
   solid, liquid, and gaseous fuels.  In addition, the costs of producing syn-
   fuels are higher for biomass than for coal.

-------
                              3-16
                           TABLE 3-3

       BREAKTHROUGH PRICES FOR TRADITIONAL ENERGY SOURCES
               IN THE MID-RANGE BASELINE SCENARIO
   Fuel                     Breakthrough Price (1980 $)

                      Beginning (1975)          Final (2100)
Coal                    0.37 ($/GJ)             0.49 ($/GJ)
                         11  ($/mtce)            15  ($/mtce)


Biomass                 0.57 ($/GJ)             0.57 ($/GJ)
                         17  ($/mtce)            17  ($/mtce)
Nuclear              9.6 - 36.4  ($/GJ)        10.0  ($/GJ)
                     0.15 - 0.55  ($/kWh)       0.15 ($/kWh)
f/ Varies by region.

-------
                              3-17





     For two fuel sources (unconventional gas and coal) modeled



by superimposing long-run and medium-run supply schedules, the



reference price of the "normal" production level also increases



over time.  In other words, the long-run supply schedules slope



upward.  The time-rate of increase in reference price equals the



rate of increase in breakthrough price.  In a similar but opposite



sense, the long-run "normal" supply curve for unconventional oil



slopes downward, paralleling the decline in breakthrough price.



     All IEA/EPA scenarios assume that significant commercializa-



tion of exotic energy sources will not be realized within the



next 120 years.  Thus, rapid development of fusion technology



or new methods of generating hydrogen during the first half of



the next century, for example, could make model projections of



fossil fuel use unreliable by the end of the next century, even



if all other assumptions were to hold.  (See Appendix A for a



discussion of exotic sources.)



     BALANCING SUPPLY AND DEMAND



     Once supply and demand schedules have been estimated for each



fuel type in each region, the model solves for market-clearing



prices in each region.  Starting points are the world prices for



each fuel traded internationally, plus transport costs and tariffs,



if any.  Regional prices are then adjusted for each fuel (gases,



liquids, solids, and electricity) until supplies and demands match



within a predesignated increment.

-------
                               3-18


     ESTIMATING CO? EMISSIONS

     The total quantity of CC>2 emitted is calculated as  the pro-

duct of fuel used in each time period and CC>2 emitted per unit

quantity of each fuel.  The following CC>2 (carbon) emission

coefficients are employed (Edmonds and Reilly, 1983b):

             CO? Emissions (Terragrams of Carbon/EJ)


     Fuel                      Preparation    Combustion  Total

     Conventional Oil             —            19.7      19.7

     Unconventional Oil          27.9           19.7      47.6
       (Shale Oil)

     Gas                          —            13.8  •    13.8

     Coal                         —            23.9      23.9

     Synthetic Oil               18.9           19.7      38.6
       (f rom coa1)

     Synthetic Gas               26.9           13.8      40.7
       (from coal)

All other fuels are assumed to contribute no CO2 to the atmosphere.

In the case of synthetic fuels from biomass, this implies that

biomass is used to generate the energy needed for liquifaction

and gasification.

     Using these coefficients, estimates of global CO2 emissions

are generated for each 25-year period.  Estimates at 5-year inter-

vals are then prepared for the next analytical step by interpola-

tion using a curve-fitting procedure.  The starting date for

estimating atmospheric CO2 is 1980.

-------
                               3-19






PROJECTING ATMOSPHERIC CO? LEVELS



     A global carbon cycle model developed at Oak Ridge National



Laboratory (ORNL)  (Emmanuel, et al., 1981) was employed to  esti-



mate the fate of CC>2 emitted into the atmosphere and, ultimately,



the airborne fraction  (retention ratio).*  The ORNL model simu-



lates stocks of carbon in three major compartments: the atmosphere,



the ocean  (surface and deep layers), and the biosphere  (ground



vegetation, trees, and soil).  Changes  in the quantities of  carbon



in these reservoirs are affected primarily by (1) CO2 emissions,



(2) land clearing  and  reforestation, and (3) temperature changes.



The last factor  implies a major feedback loop, since  increasing



atmospheric CO2  levels will raise atmospheric and ocean tempera-



tures which,  in  turn,  will  increase  the flow of carbon  from  the



ocean to the  atmosphere.  Moreover,  the flows of carbon among



other compartments are also affected by temperature.



     Since temperature is a key variable in estimating  the  fate



of emitted CO2,  a  special effort was made to represent  the  tempe-



rature  effects of  rising CO2  in the  atmosphere as realistically



as possible.  This involved coupling the ORNL and Goddard



Institute  for Space Studies  (GISS) models, since CO2~temperature



relationships are  represented  in a more sophisticated  (and  pre-



sumably more  accurate) fashion in the GISS model than  in the



ORNL model.   Details of the coupling procedures are described



in Appendix E.
 *   See  Appendix C for a more detailed  description of  the ORNL model,

-------
                               3-20





     To simplify the analysis, we assumed no net change  in  forest



cover over the 120-year period of interest.  This is not unrea-



sonable, given the offsetting trends in land clearing and refore-



station currently observed in different parts of the world.



     Using the coupled ORNL-GISS models we made several runs for



a variety of energy use/C02 emission scenarios.  These generated



a large set of 10-year average retention ratios, from which we



selected four representative series.  These correspond to very



low, low, medium, and high CC>2 emission scenarios, as indicated



in Figure 3-4.  High rates of growth in CC>2 emissions imply a



gradual saturation of natural carbon sinks and thus an increase



in atmospheric retention of CC>2 over time, while low emission



rates suggest a constant or even slightly falling retention ratio.



     Note also that the retention ratios calculated by the ORNL



model are somewhat higher than those estimated from empirical data



on historical fuel use, land use changes, and measured increases



in CC>2 concentrations.  However, substantial uncertainty1 accom-



panies the interpretation of past empirical estimates, and higher



future retention ratios are consistent with current scientific



understanding of the carbon cycle (see Chapter 2).



     The CC>2 emission categories in Figure 3-4 cover a wide range



of scenarios.  The designation of only four separate categories



may appear to introduce substantial error, since the retention



ratios assigned to these categories differ considerably, especially



in the later years.  In addition, the rates of growth in emissions

-------
                              FIGURE  3-4
  FINAL ATMOSPHERIC CO2 RETENTION RATIOS FOR FOUR TYPES OF
                      C02 EMISSION SCENARIOS
        (ADDITIONAL TONS OF ATMOSPHERIC CO2/TONS OF CO2 EMITTED)
.sor
.70
.60
.50
    I
                                                             OJ
                                                             I
                                                             to
I
I
  1980   1990   2000  2010  2020   2030   2040   2050  2060  2070  2080   2090   2100


 DEFINITIONS: VERY LOW SCENARIO = DECLINING ANNUAL EMISSIONS
           LOW SCENARIO = 1.0 - 1.49% ANNUAL GROWTH IN EMISSIONS
           MEDIUM SCENARIO = 1.5 - 1.79% ANNUAL GROWTH IN EMISSIONS
           HIGH SCENARIO = GREATER THAN 1.79% ANNUAL GROWTH IN EMISSIONS
 NOTE: NO SCENARIOS WERE INVESTIGATED WITH GROWTH RATES BETWEEN ZERO AND 1.0% PER YEAR.

-------
                               3-22






used in defining the emission scenarios in Figure 3-4 are average



annual rates over the 120-year time span of this study.  These



average rates obviously mask significant trends in annual rates



within this time span, which may imply changes in retention ratios.



However, the end product of these investigations — changes in



atmospheric temperature — is much less sensitive to variations



in retention ratio than is atmospheric CO2»  A comparison of (1)



estimated temperature levels derived from atmospheric CC>2 concen-



trations computed by the ORNL model with (2) temperature levels



associated with CC>2 concentrations calculated from the represen-



tative retention ratios revealed no significant differences.



     Using representative series of retention ratios derived from



the ORNL models output accomplishes two goals.  First, it incor-



porates, in an approximate fashion, the flows of carbon and changes



in carbon reservoirs in the global carbon cycle as estimated by



the ORNL model. Second, it avoids the necessity of running the



costly ORNL model for each new scenario. Instead, the appropriate



retention ratio series is selected and atmospheric levels of C02



computed directly by the GISS model.






PROJECTING ATMOSPHERIC TEMPERATURE LEVELS
     Once atmospheric levels of CO2 have been estimated for



future time periods, these levels are translated into changes in



atmospheric temperature using a simplified heat flux model of



the earth-atmosphere system.  This is the GISS model — a simpli-

-------
                               3-23


fication of a one-dimensional radiative/convective  (RC) atmospheric

temperature model developed at GISS (Hansen, et al., 1981; and

Lacis, et al., 1981).*

     In essence, the GISS model computes changes in the flux of

heat from atmosphere to land and ocean, which results from CC^'s

capacity to absorb infrared radiation from the earth.  As dis-

cussed in Chapter 2, some of this energy is reradiated toward

the earth's surface, thus raising the temperature of the earth

and the atmosphere at the surface and rebalancing total energy

received and emitted by the earth-atmosphere system.  The rate

at which this occurs for a given rise in C02 depends on the

degree to which the additional heat is dissipated in the ocean

and on several feedback mechanisms, the most important of which

is the increase in water vapor with rising temperature.

      The GISS model represents both the heat flux from the atmos-

phere to the surface (well-mixed) layer of the ocean, and from

this  layer  into 63 lower layers (the thermocline) of the ocean.

A simple "box diffusion" scheme is employed to represent the

diffusion and transport of heat in the ocean.  Since this process

is a  relatively slow, several years may be required for the

earth-atmosphere system to reach thermal equilibrium for a given
* See Appendix D for a more detailed description of the GISS
  model.

-------
                               3-24


increase in CC>2.*  Thus, atmospheric temperature rises always

lag CO2 rises.  For large rates of growth in annual CC>2 emissions,

this time lag may be as much as a few decades.

     The effects of rising temperature on atmospheric water vapor

and on cloud cover and height are treated explicity in the GISS

model.  These feedback mechanisms also delay the attainment of

thermal equilibrium, although the timing effect is short compared

with that of heat dissipation in the ocean.

     The GISS model incorporates various factors that influence

atmospheric temperature, in addition to CO2-  These include the

level of other greenhouse gases (specifically, nitrous oxide,

methane, and chlorofluorocarbons), the change in atmospheric

optical depth** due to volcanic activity, and variations in solar

luminosity.  Values for those parameters are based on extrapola-

tions of past trends or on average measured  levels.  However,

since data on historical trends and current  levels for these

parameters are sketchy at best, the assignment of future values

must be considered highly speculative.  The  temperature sensitivity

(the net change in temperature at equilibrium from a doubling of

pre-industrial CC>2) and the rate of heat diffusion in the ocean

are the final two key parameters.
*   Of course, the atmosphere never attains equilibrium if
    the concentrations of greenhouse gases change continually.

**  Optical depth is a dimensionless parameter that measures
    the opacity of the atmosphere.

-------
                               3-25





     Values assigned to all parameters are shown in Table 3-4.



References and brief explanations for these values are also  in-



cluded in Table 3-4 and are described in more detail in Appendix D.



     Since most of the effects of CC>2 will be manifest in terms



both of rises in atmospheric temperature and of the consequences



of these rises, much of the discussion in Chapter 4 will focus on



temperature trends.  It is useful to keep in mind, however,  that



tracing changes in fuel use through to the impact on atmospheric



temperature requires many assumptions about behavioral responses



to changing technologies and costs, energy use, and production,



and about physical and biological relationships involving CC>2.

-------
                                                         3-26

                                                       TABLE 3-4

                                          PARAMETER VALUES  FOR  THE GISS MODEL
      Parameter
 Atmospheric Level of €({4
 Atmospheric Level of
 Atmospheric Level  of  CC12F2
 Atmospheric  Level  of  CC13F
Volcanic Activity
Change  in  Solar  Luminosity
Temperature Sensitivity
                         Value

                •  Constant  1.6 ppm  for all
                   years
                •  1.6 ppm through 1980,
                   increased by 2.0% per year
                   thereafter

                •  Constant  0.300 ppm for all
                   years
                •  0.300 ppm through 1980,
                   increased by 0.2% per year
                   thereafter

                •  Constant  0.306 ppb for    a/
                   all years starting in 1980

                •  0.306 ppb in 1980, increased
                   in 10-year decreasing incre-
                   ments to  1.50 ppb in 2100

                •  Constant 0.176 ppb for    a/
                   all years starting in 1980
                •  0.176 ppb in 1980, increased
                   in decreasing 10-year incre-
                   ments to 0.642 ppb in 2100

                •  Constant level of activity:
                   increase in optical depth
                   of a constant 0.007 every
                   year from 1980-2100

                •  Zero
                   1.5°C
                   3.0°C
                   4.5°C
     Comments

Estimates of growth for
1970-80 range from 0.5
to 3.0% per year.
                                                                         Estimates  of growth  for
                                                                         1975-80  range  from 0.1
                                                                         to  0.5%  per year.
Growth estimates are
based on measured levels
between 1970 and 1980, and
assume a decrease in
emissions over the 120
year time period
                                                                         This  is  the average
                                                                         measured value over
                                                                         the last 100 years
No net change is
projected for the
next 120 years

Spans the estimated
50% confidence
interval for Te
    Reference

Lacis, et al.,
 1981
Rasmussen and
   Khalil, 1981
                            Lacis, et al.,
                             1981
                            Weiss, 1981
                                                                                                     Lacis, et  al.,
                                                                                                      1981.
                            Lamb, 1970
                            Hansen, et al.,
                             1981
                                                                                                     Hoyt,  1979
                                                                                                     Hansen,  et  al.,
                                                                                                      1981

                                                                                                     Charney,  1979
Diffusivity
                                      1.18 cm2/sec
  Abbreviations:
CH4 = methane, N2O = nitrous oxide, CC12F2
and CC13F = chlorofluorocarbons, ppm = parts
per million, ppb = parts per billion
                                                      This is within the
                                                      accepted range of
                                                      diffusivity values
                                                      for a "box diffusion"
                                                      model and consistent
                                                      with a 3.0"C temperature
                                                      sensitivity value in the
                                                      GISS model
                            Broecker et al,
                             1980
                            Hansen, et al. ,
                             1981
a/ Emissions of chlorofluorocarbons were  initiated  in  the  1940s  but  did  not  accumulate  to  significant atmospheric
~  levels until the 1960s and 70s.  Assuming  zero levels before  1980 does  not  distort estimates  of  atmospheric
   temperature appreciably.

-------
                            CHAPTER 4



     THE EFFECTIVENESS OF ENERGY POLICIES FOR CONTROLLING  CO?






     To explore the possible effects of future energy scenarios



on atmospheric CC>2 and temperature, a large number of analyses



were undertaken using the models described in Chapter 3.   Each



separate run focused on one or more key assumptions or examined



the effect of specific policies designed to slow the rate  of CC>2



rise.  The results of these analyses are described and interpreted



in this chapter.



     For clarity  in discussing the results, the energy scenarios



are divided into  two groups — baseline projections and policy



assessments.  The baseline projections depict alternative  future



patterns of energy use and resulting atmospheric CC>2/temperature



levels in the absence of any overt public effort to lower  CC>2



emissions.  These IEA/EPA projections include a reference  base-



line (Mid-range), four lower CC>2 baselines (High Renewable, High



Nuclear, High Electric, and Low Demand), and one higher CC>2 base-



line (High Fossil).  Policy assessments do just the opposite —



they evaluate the effectiveness of policies intended to slow or



limit the rate of CC>2 rise and atmospheric warming as measured



in terms of differences from the reference (Mid-range) baseline



projection.  Policy options investigated include taxes on  CC>2



emissions and various bans on specific types of fossil fuels.

-------
                               4-2






Although the distinction between baseline projections and policy




assessments is sometimes arbitrary (e.g., a low cost renewable



energy baseline could be the result of government subsidies for



renewable energy use), using a range of energy scenarios indepen-



dent of any policy considerations is useful in clarifying the



uncertainty involved in projecting future energy use, and thus



in providing a context for judging the effectiveness of policies.






BASELINE SCENARIOS



     The starting point in developing baseline scenarios is a



projection of future fuel use patterns which represents a com-



posite of "best guesses" about the state of the world through



the next century.  This case is named the Mid-range Baseline



scenario.  Predicting the future is not the goal here.   Rather,



the Mid-range Baseline serves simply as a reference point for



asking "what if" questions.   The answers to these questions shed



light on, first, the overall degree of uncertainty in estimating



atmospheric effects produced by future fuel-use patterns, and



second, the relative importance of specific assumptions concerning



energy behavior and atmospheric responses.



     MID-RANGE BASELINE



     Energy Supply and Demand




     Assumptions regarding growth in population and labor produc-



tivity, technological change (enhanced energy efficiency),  energy



use behavior,  and fuel production costs used to specify the

-------
                               4-3


Mid-Range Baseline scenario were listed in Chapter 3.  Figure

4-1 charts the estimated change in several fuel use  characteris-

tics from 1975 to 2100.  Point estimates at 25-year  intervals

are shown, with straight lines connecting the points for display

purposes.

     Note first the relatively modest rise in final* energy use

through 2050  (about 1.2 percent per year for final energy use)

and the steep rise thereafter (about 2.1 percent per year).

This is due to the substantial increase in GNP after 2050 in all

currently underdeveloped and developing regions (see Table 3-1).

Lower GNP growth rates in the less developed and developing regions

were used to  test the sensitivity of energy-use estimates to GNP

growth.  By lowering the average annual rate of GNP growth (2050-

2100) in all  less developed and developing regions from about

3.8 percent to 2.8 percent, final energy use in 2100 dropped by

17 percent to roughly 1100 EJ.

     The energy use curves also reflect a large amount of energy

conservation, that is, energy saved through solar applications

in the residential and commercial sectors plus reduced demand

due to increases in the price of energy.  In fact, the estimated

amount of final energy conserved is so large that it exceeds

the amount used after 2050. This conservation is also reflected
* Final energy use refers to the energy value of the fuels actually
  used.  That is, energy lost  in fuel preparation is not included.
  Total energy use is referred to as "primary energy".

-------
                                        4-4
                                    FIGURE 4-1
      MID-RANGE BASELINE SCENARIO: ENERGY USE CHARACTERISTICS S/
         ENERGY USE
    LIQUIDS PRODUCTION

    	 CONVENTIONAL
    — — UNCONVENTIONAL OIL
    	SYNTHETIC OIL
                                                                300
                                                                200
                                                                100
                                     GAS PRODUCTION

                                     	 CONVENTIONAL OIL
                                     — — UNCONVENTIONAL GAS
                                     	SYNTHETIC GAS
1975  2000   2025  2050  2075  2100

      SOLIDS PRODUCTION
1975  2000   2025  2050  2075   2100

  ELECTRICITY PRODUCTION
                                 1975 2000   2025   2050  2075   2100

                                  AVERAGE REGIONAL PRICES
     	 COAL (TOTAL)
     — — BIOMASS (SOLID FUEL
         ONLY)
    	 TOTAL
    	COAL
    	 NUCLEAR
         SOLAR
1975  2000   2025   2050  2075  2100
           T	1	ii
1975  2000  2025   2050  2075  2100
                                     	LIQUIDS
                                     — —GAS
                                     	SOLIDS
                                     	ELECTRICITY
                                 1975   2000   2025  2050   2075  2100
 PRODUCTION OF ELECTRICITY, UNCONVENTIONAL FUEL, AND SYNTHETIC FUEL IS SPECIFIED IN UNITS OF FINAL ENERGY.
 PRODUCTION OF OTHER FUELS IS IN UNITS OF PRIMARY ENERGY.

-------
                               4-5






in declining energy/GNP ratios from about 43 GJ/$ in 1973 to



about 16 GJ/$ in 2100, a decline of over 60 percent.  Thus, the



energy effects of increasing GNP are offset to some extent by



efficiency improvements.



     These energy-use estimates can be placed in perspective by



comparing them with estimates made by other investigators.  The



International Institute for Applied Systems Analysis has projected



primary energy use worldwide of between 705 and 1,123 EJ in 2030



(Anderer, et al., 1981).  A much lower energy-use future is



envisioned by Lovins—165 EJ in 2030 (Lovins, et al., 1981).



Our projection of about 710 EJ in 2025 thus falls in the middle



of this range of projections.



     The fuel production charts in Figure 4-1 reveal that increasing



energy demand is satisfied largely by coal, and after 2025,  by both



unconventional and synthetic sources of oil and gas.  Use of elec-



tricity also increases sharply after 2050.  Conventional sources



of oil decline rapidly after 2000 while conventional sources of



gas peak in 2025 with a steady decline thereafter.  Interestingly,



synthetic gas is estimated to be much more price-competitive than



unconventional gas throughout the next century, while synthetic



oil is first more (before 2075) and then less competitive than



unconvention oil (largely shale oil).  The crossover in production



curves for synthetic versus unconventional oil reflects the fact



that, despite technological improvements, synfuel costs are tied



to the steadily increasing cost of raw materials (almost exclusively

-------
                               4-6


coal), while costs for unconventional oil reflect only the de-

creases from maturation of the technology.  Coal shows unfaltering

strength throughout the entire period both as a solid fuel and

as the raw material for synthetic oils and gases.  Biomass and

solar electric remain minor fuel types.   Biomass is undercut

economically by coal, and solar is underpriced by both nuclear

and coal.

     Fuel-price patterns reveal differences in both production

costs and demands among fuel types.*  Higher prices for elec-

tricity and liquids are sustained by the fact that, for some end

uses, no other fuel can substitute.  For example, some industries

such as aluminum smelting are heavily invested in electrolytic

technologies, and transportation vehicles continue to be operated

by liquid fuels due to the high energy content per unit weight

and transportability of liquids.  The rising prices of all fuels

over time reflect the depletion of less  costly sources relative

to demand.  Since, of all the unconstrained fuels,  coal remains

plentiful and is characterized by the initially lowest and least

rapidly rising long-term cost function,  its rate of price increase

is the smallest.
* The fuel prices shown in Figure 4-1 are average regional prices
  unweighted by fuel use.

-------
                               4-7





     CO? and Atmospheric Responses



     The changing pattern of fuel use estimated  for  the  IEA/EPA



Mid-range Baseline scenario will produce a  specific  trend  in CO2



emissions over time.  These emissions in turn will raise the level



of atmospheric CC>2 and temperature,  the extent of the  estimated



increase being dependent on assumptions about how the  earth-



atmosphere system responds to additional CC>2 emissions.



     Figure 4-2 shows the time course of CC>2 emissions,  CC>2  con-



centrations, and atmospheric temperature at the  surface  of the



earth for the Mid-range Baseline scenario from 1980-2100.  Atmos-



pheric CC>2 and temperature values were estimated using the



following GISS model parameters: greenhouse gases other  than CC>2



were assumed to increase moderately  over time, the equilibrium



temperature for a doubling of CC>2 (Te) was  set at 3.0°C, and



the other parameters were set at their nominal values  (those



identified in Table 3-4).



     All three model outputs increase steadily in Figure 4-2



through 2040, with CC>2 concentrations doubling from  pre-indus-



trial levels around 2060.

-------
                                              4-8
                                         FIGURE 4-2

          CO2  MODELING RESULTS FOR THE MID-RANGE BASELINE SCENARIOS
       50
       40
       30
       20
       10
                                        CO 2 EMISSIONS
            1980   1990   2000   2010  2020  2030  2040   2050  2060  2070  2080  2090  2100
u
E
UJ
X
w 2



I
Ul
oc
700


600


500


400


300


200


100
                                     ATMOSPHERIC EFFECTS
CO2 LEVEL

TEMPERATURE
            1980   1990   2000  2020  2010   2030   2040   2050  2060  2070   2080   2090  2100
                                                                                  5.0
                                                                                  4.0
                                                                  H
                                                                  rn
_~  mm
3.0  3J _
    > z
                                                                  9 3

                                                              2'°  si
                                                                  O X
                                                                  O m
                                                              in    3D

-------
                               4-9






After this date, the rate of  increase  in CC-2 emissions  accelerates



dramatically.  This is due largely to  (1)  the assumed maturation



of the world's economies after 2050 and the resulting increase



in GNPs, and  (2) the accelerated use of synthetic  fuels  after



2025 and unconventional oil  (especially shale oil)  after 2050.



These factors combine to produce an average annual  rate  of  increase



in CC>2 emissions of about 2.4 percent  from 2050-2100.   (However,



this is still lower than the  rate of increase from  1950-1980,



roughly 4.1 percent per year  [Clark, 1982]).



     To further  illustrate patterns and time trends  in projected



CO2 emissions, the IEA model  estimates for each of  the  nine  regions



and for three time periods are shown in Figure 4-3.  In  2000, CC>2



emissions are dominated by the developed regions (Regions 1-4 in



Figure 4-3).  Together they  account for almost 73 percent of



global emissions.  However,  the growing importance  of the other



5 regions is  readily apparent.  By 2100, the proportion  of global



CC>2 emissions accounted for  by the three developed  regions has



fallen to just under 55 percent.  This fraction would be even



lower except  for the large quantities  of coal and shale  oil



located in  the developed regions  (especially the U.S., Canada,



Europe, and the  U.S.S.R.) and the resulting large quantities of



CC>2 generated in producing usable fuels from these  resources.



     To demonstrate the sensitivity of the atmospheric  tempera-



ture results  to  the primary  GISS modeling  parameters, the Mid-



range Baseline scenario was modeled for three values of  Te

-------
                                FIGURE 4-3

        GEOGRAPHIC DISTRIBUTION OF CO2 EMISSIONS FOR THE

                    MID-RANGE BASELINE SCENARIO
   10.0 i
    9.0
cc   8.0
    7.0
5   6-°
   5.0
   4.0
   3.0
   2.0
   1.0
                                   REGION 1-USA
                                         2-CANADA& W. EUROPE
                                         3-JAPAN, AUSTRALIA,
                                           N. ZEALAND
                                         4-USSR & E. EUROPE
                                         5-CENTRALLY
                                           PLANNED ASIA
                                         6-MIDDLE EAST
                                         7-AFRICA
                                         8-LATIN AMERICA
                                         9-S.E. ASIA
                                                                                            i
                                                                                           H"
                                                                                           O
          123456789
123456789
1  234567 89
               2000
     2060
     2100

-------
                               4-11






(1.5°Cf 3.0°C, and 4.5°C), both with and without growth in atmos-



pheric levels of other greenhous gases.  This range in Te encom-



passes the NAS confidence interval (3.0 +_ 1.5°C), while the range



in growth rates of other greenhouse gases, from 0 (i.e., constant



levels of trace gases) to those extrapolated from historical rates



(see Table 3-4), may or may not be a good approximation of the



variability in future levels of trace gases.  A uniformly higher



growth rate for all trace gases (2.0 percent per year) was also



used together with the highest value of Te (4.5°C) to establish



an upper bound for the rate of temperature increase.  The results



are snown in E'igure 4-4.



     Uncertainty in the Te and trace gas parameters produces



substantial variability in the rate of temperature increase.



Measured in terms of the year in which a temperature rise of



2°C is experienced, the overall variability is about 80 years



(from roughly 2015 to 2095 for the extreme cases).  Looking just



at the curves for a moderate growth rate in greenhouse gas levels



(middle curves in Figure 4-4), varying the assumed temperature



sensitivity of the atmosphere (temperature equilibrium) between



Te = 4.5°C and 1.5°C is seen to change the estimated 2°C year



from 2030 to 2070.  Likewise, assuming that other greenhouse gases



remain at their current levels (and that Te = 1.5°C) delays the



2°C date roughly 25 years, from about 2070 to 2095.   On the other



hand, assuming a very high growth rate of greenhouse gases other



than C02 (and that Te = 4.5°C) advances the 2°C date by another



15 years, from 2030 to 2015.

-------
                                   FIGURE 4-4
        SENSITIVITY OF MID-RANGE BASELINE TEMPERATURE ESTIMATES
0°
          Te: TEMPERATURE EQUILIBRIUM
OQG: OTHER GREENHOUSE
       1980   1990   2000   2010  2020   2030 2040  2050  2060  2070  2080  2090  2100

-------
                               4-13






     Figure 4-4 reveals considerable nonlinearity in the way



uncertaintities in temperature sensitivity and the rate of growth



of other greenhouse gases combine to change the estimated date



of a 2°C rise in temperature.  This is due in part to the angle



with which the 2°C line intersects the curves.  Moreover, the



realism of the range in parameter values remains in doubt, at



least for the greenhouse gas growth rates.  Nevertheless, this



type of sensitivity analysis provides a means for gauging the



relative importance of these two parameters.  Based on the curves



in Figure 4-4, uncertainty in temperature sensitivity appears



to introduce about 35-40 years of variability in the estimate of



when a 2°C temperature rise will be observed, while uncertainty



in the growth of other greenhouse gases introduces roughly 40-45



years of variability.



     The size of these changes in the rate of temperature increase



appear to be highly significant in the context of time needed by



public and private decisionmakers to develop and implement response



strategies.  Although a simple set of "more likely" assumptions



(Te = 3.0°C and moderately increasing levels of other greenhouse



gases) is employed for investigating baseline and policy scenarios,



the uncertainty which accompanies these assumptions must be kept



in mind when interpreting the significance of the analytical



results.

-------
                               4-14






     OTHER BASELINE SCENARIOS



     As the name implies, the Mid-range Baseline scenario is



believed to be representative of likely future conditions.  How-



ever, other scenarios may be equally probable given the incomplete



nature of the data base on which these projections are based and



the inherent risks in projecting events in the distant future.



To gauge the variability in atmospheric responses from changes



in baseline energy conditions, several alternative baseline



scenarios were investigated.



     Energy Supply and Demand



     The first alternative is a scenario with reduced CC>2 emis-



sions that features (1) lower production costs and therefore



higher use of renewable fuels, and (2) increased use of passive



solar building designs in the residential and commercial sectors



of the OECD regions.   This is called the High Renewable scenario.



First, the cost (assumed constant over time)  of producing biomass



from wastes and from energy farms is reduced  by half at every



step of the supply schedule.  Second, the rate of decline in



costs of producing solar-powered electricity  is accelerated and



the final costs reduced by between 68 and 77  percent,  depending



on the region.  Finally, use of passive solar energy is expanded



by increasing the "enhanced energy efficiency" parameter at a 0.2



percent average annual rate.

-------
                               4-15





     Figure 4-5 compares trends in selected fuel-use characteris-



tics between the High Renewable and Mid-range scenarios.  First,



energy use is higher.  The reduction in solar electric and biomass



production costs lower energy prices, thus stimulating energy



demand.  For example, the average regional price of electricity



is one third less by 2100 in the High Renewable scenario.  As a



result, electricity production is up "appreciably, as shown,



especially solar-powered production.  From a CC>2 emissions per-



spective, however, the positive effect of increased use of solar



electricity is eroded since nuclear rather than coal is primarily



replaced as the generation fuel.  (That is, solar replaces nuclear



as the marginal cost fuel. ) As will be shown later, the reduction



in C(>2 emissions compared with the Mid-range Baseline is substan-



tial but not dramatic (about 20 percent reduction between 2050 and



2100).  Figure 4-5 also reveals that the use of biomass as a solid



fuel is increased only slightly by the 50 percent reduction in



production costs since coal is still less expensive and can meet



demand for solids in most regions.



     A lower CO2~producing baseline which relies increasingly on



nuclear fuel was also investigated.  Increased use of nuclear



power  is simulated by (1) reducing the final (in 2100) production



costs of nuclear by half  (and thus production costs in earlier



years by somewhat less than half), and (2) increasing the para-



meters which control (along with relative cost) the fuel shares



for electrity generation.  The latter change implies fewer indirect

-------
                                                 4-16
                                            FIGURE 4-5

        HIGH RENEWABLE vs MID-RANGE SCENARIOS:  FUEL USE CHARACTERISTICS-S/
K.
Ill
Q.


3
K



EC

8!
UJ
1200



1000



 800



 600



 400



 200
1975
1400



1200



1000



 800



 600



 400



 200
           RNAL ENERGY USE


           —_ HIGH RENEWABLE

           	 MID-RANGE

2000
                2025
2050
                               2075
                                         2100
           SOLIDS PRODUCTION


           — HIGH RENEWABLE

           	 MID-RANGE
                       1975



                     700



                     600



                     500



                     400



                     300



                     200



                     100





                       1975
                                                     UNCONVENTIONAL OIL PRODUCTION
                                                   	HIGH RENEWABLE

                                                      •MID-RANGE
 2000   2025     2050    2075



ELECTRICITY PRODUCTION


 	HIGH RENEWABLE

 	 MID-RANGE
                                                         2000
                                                          2025
                                                                    2050
                                                                           2075
                                                                                      2100
        PRODUCTION OF SOLIDS IS SPECIFIED IN UNITS OF PRIMARY ENERGY. PRODUCTION OF OTHER FUELS IS IN UNITS OF FINAL

        ENERGY.

-------
                              4-17






cost restrictions on the construction of nuclear facilities such



as reductions in the time to obtain construction permits.  In



addition, a temporary reduction in generating capacity and a



longer term slow-down in the rate of nuclear power plant con-



struction as a result of a nuclear accident sometime between



2000 and 2025 is superimposed on this baseline.  The accident



scenario is intended to simulate the consequences of an intermit-



tent acceleration of nuclear power use.  These scenarios are



called High Nuclear and High Nuclear with Accident Baselines.



     Figure 4-6 shows the major fuel use features of these scena-



rios.  Lowering production costs and easing the restrictions on



nuclear power is a powerful stimulant to the use of electricity.



And as use of electricity expands, given this set of cost assump-



tions, production of coal and unconventional oil declines.  How-



ever, as costs decrease, total energy demand grows as well, up



to 20 percent by 2100.  The impact on CO2 emissions is a reduction



from the Mid-range Baseline but an increase above the High Renew-



able Baseline.  The effect of the simulated nuclear accident is



to cause a temporary reduction in energy demand, but the rate of



growth of nuclear power in the long-run is not affected.  The



realism of the High Nuclear with Accident scenario remains in



question since the IEA model does not explicitly consider disrup-



tions to supply factors which likely would occur if a moratorium



on new plants was declared for an extended period of time.  The



effect on CC>2 of a moratorium is to bring total emissions closer



to the Mid-range Baseline.

-------
                                            FIGURE 4-6
      HIGH NUCLEAR VS. MID-RANGE SCENARIOS: ENERGY USE CHARACTERISTICS £/
 EC

 EC
 UJ
1400

1200

1000

 800

 600

 400

 200
            FINAL ENERGY USE
            	MID-RANGE
            —— HIGH NUCLEAR
            	HIGH NUCLEAR WITH
                ACCIDENT
       1975
         2000
2025
2050
                             700

                             600

                             500

                             400

                             300

                             200

                             100
                            ELECTRICITY PRODUCTION
                            	MID-RANGE
                             	HIGH NUCLEAR
2075
                                      2100
1975
                                                           2000
2025
                                                                          2050
                                                                            2075
                                                                   2100
                                                                                                           I
                                                                                                          t-»
                                                                                                          oo
K


EC
Ul
O.
 600

 500

 400

 300

 200

 100
            UNCONVENTIONAL OIL PRODUCTION
            	 MID-RANGE
            — HIGH NUCLEAR
            	HIGH NUCLEAR WITH ACCIDENT
      1975
         2000
                             1400

                             1200

                             1000

                             800

                             600

                             400

                             200
                            COAL PRODUCTION
                            	 MID-RANGE
                             	HIGH NUCLEAR
                            	HIGH NUCLEAR
                                 WITH ACCIDENT
                     2025
       2050
                       1975
                        2000
              2025
                                                    2050
                                             2075
                                                           2100
       PRODUCTION OF COAL IS SPECIFIED IN UNITS OF PRIMARY DEMAND. PRODUCTION OF OTHER FUELS IS IN UNITS OF FINAL
       ENERGY.

-------
                               4-19


     A third lower C02~producing scenario is one  in which electri-

fication is encouraged coupled with low solar and nuclear costs.

This is called the High Electric Baseline and features  (1)  increased

market penetration of electricity in each economic sector in the

OECD regions, and (2) the same production cost functions for solar

and nuclear as in the High Renewable and High Nuclear Baseline

scenarios.  Higher market penetration would be accomplished, for

example, by greater use of heat pumps, electric boilers, and

electric cars, all encouraged by factors other than the relative

annualized costs of electricity and competing fuels.*

     This scenario produces substantially higher electricity

demand but only slightly higher total energy use, than the Mid-

range Baseline, as shown in Figure 4-7.  Only a small increase

in total demand occurs despite a decrease in the average regional

price of electricity in 2100 of 40 percent, compared to the Mid-

range scenario.  Although this price difference is substantial,

the price of electricity is still higher here than other fuels

available in the Mid-range scenario.  Since many consumers are

assumed to be using electrical equipment in this secenario irre-

spective of its price relative to other fuels, they would be

paying more for the same level of energy use estimated in the

Mid-range Baseline (since electricity costs more), thus their

level of demand decreases.
* These factors could be lower initial costs, greater reliability,
  or better ease of operation associated with electrical equipment.

-------
                                          FIGURE 4-7
      HIGH ELECTRIC VS. MID-RANGE SCENARIOS: ENERGY USE CHARACTERISTICS
   1600

   1400

   1200
 £  800
 a.
    400

    200
             FINAL ENERGY USE

           MID-RANGE
           HIGH ELECTRIC
      1975
             2000
                2025
                           2050
                                  2075
                       I
                     2100
                            1200

                            1000

                             800

                             600

                             400

                             200
     ELECTRICITY PRODUCTION

    MID-RANGE
    HIGH ELECTRIC
                                                  1975
   I
  2000
                                                            2025
                                                    2050
        I
       2075
        I
       2100
                                                                                                           I
                                                                                                           W
                                                                                                           O
£C
tc
600

500

400

300

200

100
         UNCONVENTIONAL OIL PRODUCTION
           	 MID-RANGE
           — — HIGH ELECTRIC
                                                         COAL PRODUCTION
                            1200

                            1000

                             800

                             600

                             400

                             200
	 MID-RANGE
	HIGH ELECTRIC
      1975
         2000
2025
                           2050
                                              1975
                                      2000
         2025
2050
2075
2100
        a/ PRODUCTION OF COAL IS SPECIFIED IN UNITS OF PRIMARY ENERGY. PRODUCTION OF OTHER FUELS IS IN
          UNITS OF FINAL ENERGY.

-------
                               4-21





     Figure 4-7 also shows a substantial reduction  in the use of



coal and unconventional oil.  Synthetic oil, however, remains at



about the same level as in the Mid-range Baseline.  All of these



effects work together to produce a substantial reduction in CC>2



emissions — 33% by 2100.



     The final low CC>2 baseline features high fossil fuel costs



and enhanced conservation.  These factors work together to lower



overall energy demand; thus, this senario is called the Low



Demand scenario.  The breakthrough and long-run reference prices



for coal, unconventional oil, and unconventional gas are each



increased by 50 percent.  (In effect, this raises the long-run



supply curves for these fuels without changing the slope of



the curves.)  The nonenergy costs of producing synfuels are



also increased by 50 percent.  Conservation is enhanced by intro-



ducing an arithmetic increase in the "enhanced energy efficiency"



parameter of 1.0 percent per year for OECD cuntries (residential



and commercial sector), and moderately increasing the rate of



increase for the aggregate sector in other regions.  (To illus-



trate the changes from the Mid-range Baseline, the parameter



index for 2100 is increased from 1.0 to 2.25 in the OECD sectors,



and from 1.99 to 2.25 elsewhere.)



     These changes produce significant reductions in estimated



energy demand, as illustrated in Figure 4-8.  Compared with the



Mid-range baseline, final energy demand falls about 24 percent



in 2050 and over 32 percent in 2100.  Reductions in primary

-------
                                        FIGURE 4-8

   LOW DEMAND VS. MID-RANGE SCENARIOS: ENERGY USE CHARACTERISTICS £/
   1400

   1200
   10001-
   800|_
   600

   400

   200
       FINAL ENERGY USE

       	  LOW DEMAND
       	MID-RANGE
                                      600

                                      500


                                      400

                                      300


                                      200


                                      100
        LIQUIDS PRODUCTION

        	LOW DEMAND
        	MID-RANGE
    1975
         2000
                   2025
                2050
                              2075
                                        2100
 1975
2000
2025
              2050
2075
                     2100
                                                                                                        I
                                                                                                       NJ
                                                                                                       NJ
GC
1200

1000

 800

 600


 400

 200
COAL PRODUCTION

—— LOW DEMAND
 	 MID-RANGE
250


200


150


100


 50
  1975
            2000
                   2025
                          2050
                               2075
                               2100
                                                  1975
                                                        GAS PRODUCTION

                                                        	LOW DEMAND
                                                        — MID-RANGE
                                                                               UNCONVENTIONAL GAS
                                               2000
                                                             2025
                       2050
                                                                              2075
                                                                                   2100
       PRODUCTION OF COAL IS SPECIFIED IN UNITS OF PRIMARY ENERGY. PRODUCTION OF OTHER FUELS IS IN UNITS OF FINAL ENERGY.

-------
                              4-23






energy use are somewhat higher in 2050  (about  30 percent)  but



somewhat lower lower in 2100  (about 26  percent).  As discussed



in the next section, the reduction in CC>2 emissions are  of a



comparable magnitude.



     One higher CO2~producing baseline  was explored.  Since the



costs of all fossil fuels but conventional oil and gas are reduced,



it is called the High Fossil  scenario.  Final  costs of production



(i.e., those in 2100) are reduced by 50 percent for unconventional



(shale) oil, unconventional gas, and coal.  The costs of converting



coal and biomass to synfuels  are also reduced  by half, but non-



energy costs of synfuel production are  unchanged.



     Figure 4-9 summarizes the resulting fuel  use patterns com-



pared with those of the Mid-range scenario.  As shown, the increase



in total demand (resulting from lower prices after 2000) is satis-



fied largely by increased production of (1) synthetic oil  and gas



from coal and  (2) unconventional oil.   Use of  these high CO2~



emitting fuels raises total emissions by about 20% in 2100.



     CO? and Atmospheric Responses



     The GISS modeling results for the  baseline scenarios  are



illustrated in Figure 4-10.   The variation in  CC>2 emissions and



especially in atmospheric temperature change appears small.



Using the "time to  increase by 2°C" measure, the differences



among the various baseline scenarios are negligible — less than



5 years.  In other words, the temperature curves are essentially



idential through 2040.  Even  the difference in estimated temper-

-------
                                              FIGURE 4-9
          HIGH FOSSIL VS. MID-RANGE SCENARIOS: ENERGY USE CHARACTERISTICS S/
E

K
£
1800

1600

1400

1200

1000

 800

 600

 400

 200
             FINAL ENERGY USE

             -"— HIGH FOSSIL
             — MID-RANGE
      1975
             2000
                 2025
2050
DC
1400

1200

1000

 800

 600

 400

 200
            COAL PRODUCTION
             	HIGH FOSSIL
            	 MID-RANGE
     1975
         2000
                    2025
2075
                                          2100
                        2050
       2075
                      800,-

                      700 -

                      600-

                      500-

                      400 .

                      300-

                      200.

                      100.
1975
                      LIQUIDS PRODUCTION

                      —- HIGH FOSSIL
                      — MID-RANGE
                                                       2000
                                      2025
                                      2050
                             2075
2100
                            GAS PRODUCTION
                             — HIGH FOSSIL
                            — MID-RANGE
                      500

                      400

                      300

                      200

                      100
                                          2100
                       1975
                        2000
               2025
                                                                     2050
      PRODUCTION OF COAL IS SPECIFIED IN UNITS OF PRIMARY ENERGY. PRODUCTION OF OTHER FUELS IS IN UNITS OF FINAL ENERGY.

-------
                             FIGURE 4-10

   CO 2 MODELING RESULTS FOR ALTERNATIVE BASELINE SCENARIOS

                  INCREASE IN ATMOSPHERIC TEMPERATURE
C/J
LU
Ul

O
LU
Q
   5.0
  4.0
3.0
           	 MID-RANGE
            	HIGH ELECTRIC
           	 HIGH NUCLEAR
           	HIGH RENEWABLE
            « » » HIGH FOSSIL
           * A A LOW DEMAND
   2.0
   1.0
                                                                                I
                                                                                to
                                                                                Ul
        I     I    I     I    I     I     I    T    I    1     I    I    I
       1980   1990   2000  2010  2020  2030  2040  2050  2060   2070 2080  2090  2100
                            CO 2 EMISSIONS
a:  60

cc
£  50


1  40
cc

?  30
   20
                                               fsgpg
O
5
   10
       1980  1990  2000  2010   2020  2030  2040  2050  2060   2070  2080  2090  2100

-------
                              4-26





atures in 2100 varies by only about 0.7°C or less than 15 percent



of the projected Mid-range temperature.  Clearly, conclusions



about the effectiveness of policy options which are reached in



this study will not be substantially affected by the choice of



baseline scenario.






     OTHER BASELINE SENSITIVITY TESTS



     In addition to specifying alternative energy use baselines,



the sensitivity of the principal model outputs to selected inputs



was tested separately.  As noted earlier in this chapter, lower



GNP growth rates were tested (2.8 versus 3.8 percent per year)



for the less developed and developing regions for the period



2050-2100.  Another test involved lowering income (or GNP) elas-



ticities of energy demand.  Initial values of 1.0-1.4 in the



Mid-range Baseline were reduced uniformly to 0.85 for all regions



and all time periods.



     Although changing each of these input variables reduced



energy demand by as much as 22 percent in 2100, the effects on



CC>2 emissions and concentrations and especially on atmospheric



temperature were substantially muted.  Lowering GNP growth rates



after 2050 obviously did not affect the projected year of a 2°C



rise (2040 in the Mid-range Baseline), and reduced the estimated



temperature rise in 2100 by only 0.2°C (less than five percent).



Decreasing the income elasticity of demand likewise had no per-



ceptable effect on the 2°C year, and lowered the rise in 2100 by



less than 0.5°C.

-------
                              4-27


     We conclude from these results that moderate changes  to

GNP growth rates (post-2050) and to income elasticity of energy

demand values will not significantly alter the findings and

conclusions of our study.


POLICY OPTIONS

     Policies selected for assessment are designed explicitly

to reduce emissions of (X>2 either indirectly by depressing

aggregate energy demand, or directly by shifting fuel-use

patterns toward fuels with low net emissions of CO2«  Most

policy options examined possess some elements of each strategy.

     TAXES ON CO-) EMISSIONS

     The first set of policy options are based on taxing fuel use

proportionately to the fuel's net CO2 emissions per unit of energy.

Three variations were examined:  (1) a tax only in the United Stated

(2) taxes in all OECD countries, and (3) taxes in all countries.

Tax schedules were specified to double the cost of the highest CO2

emitting fuel (unconventional oil):

        Fuel Type                          Tax (percent)

        Conventional Oil                       41%
        Conventional Gas                       29
        Unconventional (Shale) Oil            100
        Unconventional Gas                     29
        Synthetic Oil                          81
        Synthetic Gas                          86
        Coal                                   52
        All Others (solar, biomass, hydro)      0

Taxes of up to 300 percent were also investigated.

-------
                               4-28


     Taxes were initiated in 2000 and were applied at both the

points of end use and production such that the combination was

sufficient to achieve the total percent taxation indicated

above.*  In addition, fuel export bans were placed on the United

States (U.S. Tax scenario) and on all OECD countries (OECD Tax

scenario) to prevent the export of fuels from taxed to untaxed

regions, which would otherwise have undercut the global effec-

tiveness of the policy.

     Energy Supply and Demand

     Changes in total energy demand and in the use of selected

fuel types are illustrated in Figure 4-11 for each of the three

CC>2 tax scenarios.  First, an overall dampening of worldwide

energy demand is apparent in direct relation to increases in

fuel prices as a result of the taxes.  Second, a shift away from

high CC>2-emitting fuels is projected with one exception --

synthetic oil.  Production of syncrude is depressed relative to

the Mid-range Baseline early in the next century, but exceeds the

baseline levels by 2075 for all tax scenarios.  Apparently the

demand for liquid fuels remains high (especially in the transpor-

tation sector), and syncrude is selected over unconventional oil

to satisfy this demand.  (Recall that the tax on syncrude is 81
* Due to the structure of the IEA model, negative taxes (sub-
  sidies) had to be applied to biomass production to offset
  the end use taxes on biomass and biomass-derived synfuels.

-------
                                          FIGURE 4-11
CO 2 TAX POUCIES VS. MID-RANGE BASELINE SCENARIOS: ENERGY USE CHARACTERISTICS
                                                       a/
      1400

      1200

      1000

       800

       600

       400

       200
              FINAL ENERGY DEMAND
  	MID-RANGE
_	U.S. TAX
  	OECDTAX
  	WORLD TAX
 UNCONVENTIONAL OIL
      PRODUCTION
	MID-RANGE
	U.S. TAX
	OECDTAX
    WORLD TAX
                                                                           SYNTHETIC OIL PRODUCTION
    	 MID-RANGE
     	U.S. TAX
    	OECD TAX
    	 WORLD TAX
        1975   2000  2025  2050   2075  2100  1975  2000   2025  2050  2075  2100   1975  2000   2025  2050   2075  2100
       300

       250

     (£. 200

     cc
     SI 150
          SYNTHETIC GAS PRODUCTION
  	MID-RANGE
  -._ U.S. TAX
.	OECDTAX
  	 WORLD TAX
     IU
       100

        50
  AVERAGE REGIONAL
   PRICE OF UQUIDS
   . MID-RANGE
    U.S. TAX
   • OECD TAX
    WORLD TAX
14

12

10

 8

 6

 4

 2
         AVERAGE REGIONAL
          PRICE OF GASES
                                                                     . MID-RANGE
                                                                      U.S. TAX
                                                                     • OECD TAX
                                                                     ' WORLD TAX
         1975  2000   2025  2050   2075  2100  1975  2000   2025  2050   2075   2100  1975   2000  2025   2050  2075  2100
    !/
     PRODUCTION OF ALL FUELS IS SPECIFIED IN UNITS OF FINAL ENERGY.
                                                                                                                I
                                                                                                                N>
                                                                                                                vo

-------
                               4-30





percent while the tax on unconventional (shale) oil is 100 per-



cent. )  Note also that much of the effect achieved by taxing CC>2



emissions occurs after the middle of the next century when



large-scale production of unconventional oil and synthetic fuels



is underway.



     Figure 4-11 also reveals that the World Tax scenario is



much more effective in shifting energy demand and fuel-use pat-



terns than the other two scenarios.  This is a direct reflection



of energy use levels in the U.S. and all OECD countries compared



with total worldwide levels.  For example, in 2050 under the



Mid-range Baseline assumptions, the United States is projected



to account for 21 percent and all OECD countries 51 percent of



the world's energy consumption.  By 2100, these levels are pro-



jected to fall to 14 and 34 percent, respectively.



     Interestingly, none of the tax scenarios affects the use of



coal appreciably.  The demand for solid fuels remains strong and



the level of C02 taxes investigated does not provide sufficient



cost advantage for biomass to capture a substantial share of



this market.



     Tripling the level of taxation on all fossil fuels world-



wide (i.e., 300 percent on unconventional oil and proportional



increases for the others) enhances each of the fuel use trends



shown in Figure 4-11.  Projected energy demand in 2050 is just



over 300 EJ (60 percent of the Mid-range level), synfuel produc-



tion is delayed until after 2050, and even coal production is

-------
                               4-31





depressed (by over 50 percent relative  to  the  Mid-range  level).



Changes by 2100 are even more dramatic.  However,  the  penalty



paid for improved effectiveness  in reducing CC>2  emissions  is



a substantial rise in average regional  energy  prices:  approxi-



mately 60 percent for liquids, 40 percent  for  gas,  and 20  per-



cent for solids compared with the Mid-range Baseline price



schedules in 2050.



     CO2 and Atmospheric Responses



     The resulting CC>2 emissions and atmospheric temperature



trends are shown in Figure  4-12.  As suspected from the  fuel-



use effects, only the World Tax  scenario achieves  a significant



reduction in CC>2 emissions  and,  even here, only  toward the end



of the next century.  (Emissions are reduced from  5-18 percent



in 2050 and from 10-42 percent in 2100.)   In terms  of  changes



in atmospheric temperature, the  differences between the  tax



scenarios and the Mid-range Baseline are even  less  dramatic.



Only the World Tax scenario appears to  affect  the  timing of a



2°C increase in temperature and  only on the order  of a few years.



Even tripling taxes worldwide delays a  2°C rise  by just  over 5



years.  Temperature differences  are more pronounced in 2100, but



even this far into the future, the maximum estimated reduction



is only about 0.7°C.  Tripling taxes is more effective but not



overwhelmingly so (a  lowering of temperature in  2100 by  perhaps

-------
CO
UJ
IU
EC
13
Ul
O
    5.0
    4.0
    3.0
    2.0
    1.0
                                   4-32

                               FIGURE 4-12

               CO2 MODELING RESULTS FOR TAX POLICIES

                 AND MID-RANGE BASELINE SCENARIOS
                 INCREASE IN ATMOSPHERIC TEMPERATURE
          MID-RANGE

          U.S. TAX

          OECD TAX

          WORLD TAX
        1980  1990  2000  2010  2020  2030  2040   2050   2060  2070   2080   2090   2100
                                CO2 EMISSIONS
tc.
UJ
a.

u.
O
CO



I
O

(S
50


40


30


20



10
MID-RANGE

US TAX

OECD TAX

WORLD TAX
    1980   1990  2000  2010  2020  2030   2040   2050   2060  2070   2080   2090  2100

-------
                              4-33






     FUEL BANS



     A more direct approach to slowing the rate of CC>2 growth



is to prohibit all uses of selected high CC>2-emitting fuels.



Four separate combinations of fuel bans were investigated:  (1)



coal alone, (2) unconventional (shale) oil alone, (3) shale



oil and synthetic fuels, and (4) shale oil and coal.  The ban



on coal is phased-in between 1980 and 2000.  To obtain the max-



imum effect from these policies, worldwide cooperation among



governments is assumed.



     Energy Supply and Demand



     Figure 4-13 shows the energy patterns produced by the four



fuel ban scenarios.  Due to prohibitions on the indicated fuels,



energy prices  in general are bid upwards by consumers attempting



to satisfy their demands.  Price increases for liquid fuels are



especially dramatic (over a 300 percent increase) for the scenario



banning shale  oil and synthetic fuels.  Solid fuel prices are



increased the  greatest for the two scenarios banning coal (80-



120 percent increase).   (Gas prices also rise relative to the



Mid-range Baseline but in a somewhat muted fashion).  The ulti-



mate effects are substantial decreases in total energy demand



compared with  the reference baseline, from 20 to almost 80



percent in 2100.  The two scenarios banning coal achieve these



reductions earlier than  the other scenarios.

-------
                                                 4-34
                                             FIGURE 4-13
     FUEL BANS VS. MID-RANGE BASELINE SCENARIOS: ENERGY USE CHARACTERISTICS
             FINAL ENERGY USE
K
£
3
  1400

  1200

  1000

   800

   600

   400

   200
                                    700

                                    600
 — MID-RANGE
 — NO SHALE
 • — NO SHALE, NO SYNFUELS
 —NO SHALE. NO COAL     ,
••« NO COAL          / //  50°
                                    100
   SYNFUEL PRODUCTION
—— MID-RANGE
—— NO SHALE
......... MO SHALE, NO COAL
 ...... NO COAL
                                                          1400
                                                                    1200
                                                                                COAL PRODUCTION
 •     MID-RANGE
 —— NO SHALE
 	NO SHALE.
       NO SYNFUELS
    1975
          2000   2025  2050   2075  2100  1975   2000  2025   2050  2075  2100   1975  2000   2025  2050   2075  2100
BIOMASS (AS SOLID FUEL) PRODUCTION
  240

  200

  160
cc
a. 120
HI
o.
3  80

   40
       —— MID-RANGE
       ,—— NO SHALE
       ----- NO SHALE, NO SYNFUELS, *
                                    60
                                   =J 50
                                   AVERAGE REGIONAL
                                     PRICE OF LIQUIDS
                               	 MID-RANGE
                             r ___ NO SHALE
                               	NO SHALE. NO SYNFUELS
                               -«—— NO SHALE, NO COAL
                                           4-
                            60

                            50

                            40

                            30

                            20

                            10
   AVERAGE
     PRICE OF SOLIDS
     MID-RANGE
___NO SHALE
	—NO SHALE, NO SYNFUELS
«——NO SHALE, NO COAL   ^
 ...... NO COAL
                                                                                             „*••*•
                                                                             ....—ViVV'*"* * *

 a/
    1975   2000  2025   2050  2075  2100    1975  2000  2025   2050  2075  2100   1975  2000   2025  2050   2075  2100

   PRODUCTION OF COAL AND BIOMASS IS SPECIFIED IN UNITS OF PRIMARY ENERGY. PRODUCTION OF SYNFUELS IS IN UNITS OF FINAL
   ENERGY.

-------
                               4-35


     Production patterns for individual fuel types provide addi-

tional insights.  Synfuels are allowed under three scenarios.

When shale oil is banned, synthetic oil production grows to meet

demands for liquid fuels.  However, when coal is also banned,

synfuel production is limited by the availability (and price) of

biomass.  Thus, synfuel levels drop relative to the Mid-range

Baseline.  Similarly, the production of coal is affected by the

demand for coal-derived synthetic oil and gas; when synfuels are

banned, coal production drops below the Mid-range Baseline levels.

(This is also reflected in the constant or slightly decreasing

price of solid fuels.)

     Biomass and coal are direct competitors both as solid fuels

and as raw materials for synfuels.  Whenever coal is unconstrained,

it has a substantial competitive edge in almost all regions.   How-

ever, when coal is banned, the full potential of biomass to satisfy

demands for liquids, gases, and solids worldwide can be assessed.

Figure 4-13 reveals that, in the "No Shale, No Coal" scenario,

biomass accounts for about 225 EJ of synthetic liquid and gas

production and about 160 EJ of solid fuel production in 2100.

Together, this represents almost 60 percent of total energy

demand projected for this scenario.*  The penalty for relying
* The worldwide potential of energy farms to produce biomass for
  energy has been estimated at between 237 and 3374 EJ, depending
  on the types of crops planted and the agricultural practices
  employed.  Urban waste may add another 100 EJ potential by 2100
  (Reilly, et al., 1981). These estimates are considerably higher
  than the biomass resource estimates in Appendix A (Table A-2).
  However, the latter assume no dramatic change in the availability
  of coal, and thus implicitly incorporate considerations of cur-
  rent economic feasibility.  The resource availability estimates
  used in the IEA/EPA scenarios are intended to reflect extreme
  circumstances.

-------
                               4-36





on bioraass is reflected in the higher price of solid fuels —



approximately $5.25/EJ in 2100 compared to the reference price



of $2.25.



     CO? and Atmospheric Responses



     The time course of CO2 emissions and atmospheric tempera-



ture for the fuel ban scenarios are shown in Figure 4-14.  The



changes in energy demand and fuel use discussed above translate



into significant decreases in CC>2 emissions.  The most stringent



prohibition scenario (coal and shale oil bans) achieves absolute



reductions in CC>2 emissions over time; emissions in 2100 are



slightly more than 1000 gigatons of carbon worldwide compared to



about 4700 in 1975.  Moreover, reductions begin very early in



the 120-year time period due to the ban on coal phased-in



between 1980 and 2000.  The "No Shale, No Synfuels" scenario



is less effective in terms of total emissions avoided, but does



achieve reductions beginning about 2020 and totaling about two-



thirds of the projected 2100 emissions in the Mid-range Baseline.



Banning just shale is less effective although it still achieves



almost a 60 percent reduction in CC>2 emissions in 2100 compared



with the baseline emissions.  Finally, much of the effectiveness



of a "coal only" ban is eroded after 2040 when shale oil comes



on-line.



     To further illustrate the effect of fuel bans on reducing



C02 emissions, Figure 4-15 shows changes in emissions over time



for two scenarios in each of the nine geographic regions.  In the

-------
                                    FIGURE 4-14
CO2 MODELING RESULTS FOR FUEL BANS AND MID-RANGE BASELINE SCENARIOS
  U
  DC
  C3
  Ul
     5.0
     4.0
     3.0
     2.0
     1.0
                        INCREASE IN ATMOSPHERIC TEMPERATURE
   	 MID-RANGE
   — NO SHALE
   — • — NO SHALE, NO SYNFUELS
   ....... NO SHALE, NO COAL
   * * * NO COAL
                                                                                               I
                                                                                               W
                                                                                               -J
           •     I      iiiii     ii     ii|i
          1980  1990  2000   2010  2020  2030  2040  2050   2060  2070  2080  2090   2100
   oc
   > 50
   cc
   IU
   t 40
   u
      30
     20
   (a
   O 10
   C3
   a
                                   CO 2 EMISSIONS
   	MID-RANGE
   	NO SHALE
   	NO SHALE, NO SYNFUELS
   	NO SHALE, NO COAL
   *  « * NO COAL
       I     I     I     I     I     I     I     I     I     I     I
1980  1990   2000  2010  2020  2030  2040  2050   2060  2070  2080  2090   2100

-------
                    FIGURE 4-15
GEOGRAPHIC DISTRIBUTION OF CO2 EMISSIONS FOR SELECTED
   FUEL BANS AND THE MID-RANGE BASELINE SCENARIOS


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-------
                               4-39






earliest year (2000) when only a ban on coal reduces emissions,



the effects of the ban fall on regions roughly in proportion to



their emissions of CC>2 in the Mid-range Baseline scenario.



Exceptions to this rule are Region 6 (the Middle East), which



has very little coal, and Region 8 (Latin America), which has a



large biomass potential and is given credit for exporting biomass-



derived fuels.  By 2050, the effect of a coal ban becomes more



uneven, as the coal-rich regions — Region 1 (U.S.) and Region 4



(U.S.S.R. and Eastern Europe) — show proportionately the largest



drop in projected emissions.  By 2100, these two regions have



reduced emissions by about 95 and 98 percent respectively,



relative to the Mid-range Baseline projections.  (Africa and



Latin America both show zero net emissions due to the IEA model's



accounting scheme for exported biomass energy.)



     The pattern of impacts from a ban on shale oil and synfuels



is similar — those regions with large deposits of shale oil or



coal are affected the most.  Thus, by 2100, Region 1 (U.S.),



Region 2 (Canada and Western Europe), and Region 4 (U.S.S.R and



Eastern Europe) are forced to reduce emissions by the greatest



percentage.   In the opposite sense, regions with large capaci-



ties for biomass production are also disadvantaged by the ban



on synfuels and thus show higher emission levels than those in



the coal ban  scenario.

-------
                              4-40


     Looking at the atmospheric effect of reductions in C02

emissions associated with fuel bans (Figure 4-14), only the

scenarios which ban coal affect the timing of a 2°C rise in

atmospheric temperature.  For these, however, the size of the

effect is significant — the estimated 2°C year is delayed from

roughly 2040 in the baseline to approximately 2055 in the coal

ban scenario, and to 2065 under coal and shale oil bans.  The

scenario featuring a ban on shale and synfuels appears to delay

the 2°C date by no more than 5 years, while a ban on shale alone

is totally ineffective by this measure.*  All prohibition

scenarios achieve substantial reductions in temperature rise by

2100, with the most stringent scenario achieving almost a 50

percent reduction.

     Based on these results, a clear distinction between medium-

term and long-term strategies emerges.  The scenarios in which

coal is banned show significant medium-term effects (delay in a

2°C rise) since the ban affects fuel use and CC>2 emissions in

the early years (by 2000 and thereafter).  Bans on synthetic
* In other words, although banning shale alone is not effective
  in delaying a 2°C rise, banning shale in addition to coal
  appears to add about 10 years to the "coal only" delay (2055
  to 2065).  These results at first appear contradictory but
  can be reconciled; a prohibition on coal encourages an earlier
  emergence of shale oil (about 100 EJ of unconventional oil
  are produced in 2050 in the "coal only" scenario compared with
  only 10 EJ in the Mid-range Baseline), presumably because the
  lack of coal-derived synthetic oil makes shale oil more cost-
  competitive.

-------
                              4-41






fuels and unconventional oil only become effective when these



fuels would otherwise come on-line.  Thus, policies  incorpor-



ating synfuel and shale oil bans reduce long-run temperature



increases, but not the timing of a 2°C rise.



     It is also useful to note that a simultaneous ban on coal



and synfuels would be duplicative; no additional reduction in



either CO2 emissions or atmospheric temperature is achieved by



prohibiting synfuels once coal is banned.  Moreover, allowing



the production of synthetic liquids and gases while prohibiting



coal will provide for a biomass-based synfuel industry, thus



partially satisfying the demand for liquid fuels in a manner



that depresses CO2 emissions.





SUMMARY



     Of the various energy policies designed to slow the rate



of atmospheric warming over the next century that were examined



in this analysis, only two have been demonstrated to effectively



delay the timing of 2°C rise in temperature.  Both include a ban



on the use of coal which becomes fully effective in 2000.  This



ban (1) reduces demand for solid fuels by raising their price,



and (2) stimulates the use of biomass as a coal substitute.



Both effects reduce the aggregate amount of CC>2 emitted between



now and the middle of the next century.  When a ban on coal is



combined with a ban on shale oil, the projected 2°C warming may



be delayed by perhaps 25 years.

-------
                               4-42






     Banning shale and synthetic fuels alone will produce a



slowing of temperature rise in the second half of the next



century.  If coal is also banned, prohibitions on synthetic fuel



production are not necessary since all synfuels would be derived



from biomass.  The effectiveness of fuel bans in lowering the



projected temperature in 2100 is significant for all prohibition



policies studied, and greatest for policies which ban both coal



and shale oil.



     The imposition of fuel taxes applied in proportion to CC>2



emission characteristics of individual fuels appears to be much



less effective than outright fuel bans.  Taxes of several hun-



dred percent in magnitude would be needed to substantially



depress demand.  Even then, the distinction among different type



of fuels in terms of CC>2 emission characteristics is not nearly



as sharp as placing bans on selected fuels.  Thus, fuel taxes do



not appear to be effective medium-term policy options, and would



be effective in the long-run only if taxes were very high.



     Regardless of which general policy approach is under con-



sideration, any hope of success requires cooperation among at



least the major energy consuming and producing nations.  Over



time, almost all nations will fall into this category.  Without



worldwide cooperation, international fuel trading and uncon-



strained use of fuels in non-cooperating countries would impede



the effectiveness of any policy.

-------
                              4-43






     These findings must be placed in the context of uncertain-



ties surrounding the relationships between  (1) emissions and



atmospheric concentrations of CC>2 (that is, the nature of the



carbon cycle), and (2) atmospheric temperature and CC>2 concen-



trations (that is, the actual temperature equilibrium for doubled



CC>2).  The latter appears to be the more important, and introduces



substantial variability in projections of temperature rise.  This



variability is on the order of 35-40 years  in the estimate of when



a 2°C warming will occur.  Of at least equal significance are



uncertainties regarding future levels of other greenhouse gases



and their effect on atmospheric temperature.  These uncertainties



may account for another 40-45 years in the  variability of the



estimated 2°C warming date.

-------
                            CHAPTER 5



    THE ECONOMIC AND POLITICAL FEASIBILITY OF ENERGY POLICIES






     The analysis in Chapter 4 clearly shows that only policies



that ban coal, or coal and shale oil, would significantly delay a



warming of 2°C or more.  Furthermore, a ban on coal and shale oil



would be effective in reducing the temperature rise in 2100.  This



chapter examines whether these policies are also economically



and politically feasible.



     The economic implications of banning coal and shale oil are



likely to be significant.  Prohibitions on using these fuels



would necessitate a fundamental change in fuel use and would most



likely affect all sectors of the world economy.  It would dampen



economic growth by causing a shift to more expensive fuel substi-



tutes.  The asset value of existing coal and shale oil resources



would decline, as might the value of facilities supporting the



production, transportation, and use of fossil fuels due to pre-



mature retirement.  On the other hand, the value of alternative



fuels would be enhanced by coal and shale oil bans.



     The economic impact of these policies would affect different



countries in very different ways.  Impacts would be largest in



developed economies heavily dependent on fossil fuels or in



countries with large coal and shale oil deposits.  Higher energy



prices could also severely constrain the economic growth of



developing and less developed countries.  Such economic hardships

-------
                               5-2





could be mitigated by anticipating and planning for changes in



energy supplies.



     This chapter examines each of these issues.  In particular,



it looks at our current and likely future commitment to coal and



shale oil, and the economic consequences of banning their use.



Ideally, this analysis would be based on a detailed model of the



world economy capable of translating changes in the energy sector,



into changes in inflation, economic growth, income levels, and



other relevant economic indicators.  Unfortunately> no current



model provides the desired level of detail and specificity.



Given this limitation, we have focused on specific aspects of



likely economic impacts and have tried to illustrate the magni-



tude of potential effects through a series of examples.





EFFECTS OF POLICIES ON COAL RESOURCES



     A nation's natural resources can constitute a significant



percentage of its wealth.  An obvious example is the gold and



diamonds of South Africa.  Similarly, oil and gas resources have



created enormous wealth for Mideast nations.  Vast coal deposits



in several nations are considerably valuable now, and could be



even more valuable in the years to come.



     GLOBAL DISTRIBUTION OF COAL



     Most of the world's known coal resources are found in the



Northern Hemisphere.  The Southern Hemisphere contains fewer



large sedimentary basins where coal typically forms, and has

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                               5-3






not been as extensively explored because of limited  regional



demand.  However, many developing countries may  increase  their



rate of exploration in anticipation of  increased  industrial



activity and in pursuit of greater energy  independence.   Hence,



estimates of total coal resources are very likely to  increase in



the future.



     Figure 5-1 provides a summary of coal resources  throughout



the world.  Coal resources total approximately 10 trillion metric



tons of coal equivalent (mtce) worldwide, based on a  compilation



of estimates from various international organizations.  As shown,



the Soviet Union ranks first, with 44 percent of  total resources,



and the United States, China, and Australia are the next  three



leading nations.  The top three countries alone contain 83 percent



of the world's total coal resources.



     Figure 5-2 contains estimates of "economically recoverable"



coal resources, that is, of coal reserves.  The world's recover-



able reserves are estimated to be 688 billion tons — only 6.9



percent of known resources.  Yet, at 1980 production  levels, this



recoverable coal still represents about 258 years of  supply.  The



United States has the largest amount of reserves, followed closely



by the U.S.S.R. and China.  Combined, these three countries have



some two-thirds of the world's recoverable coal reserves.



     These data on coal resources and reserves have  important



implications for CC>2 mitigation strategies.  The economic burden



of any international agreement to limit the use of coal will fall

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                                            5-4
                FIGURE 5-1
            COAL RESOURCES
          ALL OTHER
           NATIONS
          TOTAL: 10.000 BILLION MTCE
     FIGURE 5-2
RECOVERABLE COAL
     RESERVES
TOTAL: 688 BILLION MTCE
SOURCE: UNITED NATIONS, 1981, 1979 YEariBOOK OF WORLD ENERGY STATISTICS. AND FEDERAL INSTITUTE FOR GEOSCIENCE AND
       NATURAL RESOURCES, 1980, SURVEY OF ENERGY RESOURCES. AS REPORTED IN GROSSLING, 1981, WORLD COAL RESOURCES.

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                               5-5
                                          \
primarily on three nations — the U.S.S.R.,  China,  and  the United
States.  Moreover, the exclusion of any one  of  these  nations
would permit the use of enough coal to erode the  effectiveness
of any CC>2 control policy based on banning its  use.
     CHANGES IN VALUE OF COAL RESERVES
     Any substantial shift away from  coal would have  a  dramatic
effect on the value of these resources.  A ban  (or  even a  tax)
on coal would reduce the demand for these resources and there-
fore depress their asset values.  Countries  and people  owning
deposits of the affected fossil fuels would  lose  the  revenues
these resources would otherwise earn.  In addition, the value
of the infrastructure used to produce, transport, and use  these
fuels would also decline if these facilities are  prematurely
retired.
     To some extent, the loss in value of these resources  would
be offset by the enhanced worth of substitute fuels and techno-
logies.  Whether the alternatives are solar,  nuclear, biomass,
or some combination thereof, the value of these technologies
should increase in direct proportion  to their increased demand.
Although it is clear which nations would lose from prohibitions
against certain fossil fuels, it is less clear which  ones  would
gain.  Who the winners and losers are will play an  important
role in determining the feasibility of international  CC>2 policies.

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                               5-6


     Estimating the magnitude of the loss in asset value is

straightforward in concept, but difficult in practice.  The diffi-

culty arises in estimating the value of the coal deposits with

and without a coal ban.  This value should be based on the future

stream of production levels, forecasted production costs, and

future prices.  It would vary based on expectations of how long

the ban would be imposed, the location of each deposit, and a

host of other factors.

     An approximation of lost asset value can be obtained by

comparing production levels and prices of coal in the two rele-

vant scenarios — the Mid-range Baseline and either one of the

coal ban scenarios — and ignoring the other relevant variables.

This'provides an estimate of lost revenue, a portion of which

reflects profits from coal, and thus is a measure of the loss in

asset value.  Using a real discount rate of 5 percent, the lost

revenues are estimated to be approximately $2.8 trillion (in 1980

dollars).  Using a real discount rate of 10 percent drops this

estimate to just over $700 billion.*  In either case, however,

the lost value would be enormous.  Moreover, this loss is under-

stated because it does not include the decline in value of the

coal resources that would have been used after 2100 in the absence

of a ban.
*  Many economists argue that the appropriate discount rate for
   long-run resources (or future investments) should be close to
   zero to fairly reflect the interests of future generations.

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                               5-7


     CHANGES IN FUEL PRICES

     Another indication of the impact of a ban on  coal  is  the

magnitude of the changes in energy prices resulting  from these

policies.  For example, in the year 2050, the projected price of

solids (coal or biomass) would increase from about $1.40/GJ  in

the Mid-range scenario to about $3.10/GJ (just biomass) if a ban

on coal were adopted.  If oil shale is also banned,  the price of

liquid fuels in the Mid-range Baseline similarly would be bid

upwards, almost doubling by 2100.

     Higher prices for energy encourage increased efficiency and

therefore reduce overall demand.  However, higher prices also

require that the production and use of energy absorb a greater

portion of total wealth.  As a result, less capital  is available

for other economic activities.

     CAPITAL INVESTMENTS IN COAL

     In addition to the loss in value of coal resources, other

aspects of the coal "market chain" may also be affected.  The

market chain provides a useful conceptual framework  for identi-

fying and analyzing capital investments directly linked to the

use of that resource.  The typical coal market chain consists of

three components:

     •  extraction — removing the fossil fuel from  the, earth
        either through a surface or deep mine;

     •  transportation/preparation — moving the fossil fuel
        from its resource location to a consuming market and
        preparing it for consumption, including coal washing;
        and

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                               5-8


     •  conversion — using the prepared fossil fuel directly
        as a heat source or indirectly to generate electricity.

     A comprehensive analysis of the costs involved in banning

coal would require extensive knowledge of local conditions in

each country.  It is thus considerably beyond the scope of this

study.  Instead, this section looks at two specific market chains

and a study of aggregate future coal investments to illustrate

the magnitude of capital invested in extracting, moving, preparing,

and converting coal.  These chains involve moving coal from the

western United States for use in (1) a power plant in Japan and

(2) a power plant in the southwestern United States.

     Table 5-1 summarizes the approximate investment necessary

to establish a coal chain between a western United States mine

and a Japanese 800-megawatt power plant.  The total capital

invested in the chain is about $1.2 billion (in 1980 dollars),

with nearly 75 percent of this total associated with the power

plant.  Hence, for each short ton of coal traded annually between

the United States and Japan related to this particular chain,

approximately $471 of capital will have been invested.

     The capital investment required for a domestic U.S. coal

chain is almost as much as the above example (Table 5-2).

Interestingly, even with the use of a capital-intensive slurry

pipeline to move western coal to a West South Central market,

the estimated share of total capital represented by the power

plant is over 80 percent.

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                                                         5-9
                                                     TABLE 5-1
Facility Required:
                            APPROXIMATE CAPITAL INVESTMENT FOR INTERNATIONAL COAL CHAIN:
                                    WESTERN UNITED STATES TO JAPANESE POWER PLANT
                                             (MILLIONS OF 1980 DOLLARS)
     Mine

  25% capacity
of a 10-million
 ton/yr. mine
  Trains

   3.9
   unit trains
        S/
 Seaport

25% capacity
of a seaport
                                                                                          a/
  4.9
  ships
  Power Plant

       One
800-MW power plant
Useful Life:
 20 years or
    more
15 years or
   more
 30 years or
    more
15 years
  45 years or
      more
Initial Capital Investment:
      $33
    $42
  $39
 $195
      $877
                            Total Coal Shipped
                            Total Initial Capital Investment
                            Capital Investment Per Ton-Year
                                       2.52 Million Short Tons/year
                                       $1,186  Million
                                       $471
a/  Facility required and capital investment are ICF interpretations of data reported in Coal
    to the Future, Report of the World Coal Study, WOCOL, 1980,  Figure 8-2,  page 205.

Source:  ICF Assessment, 1983
                                                                   - Bridge

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                                     5-10
                                  TABLE 5-2

           APPROXIMATE CAPITAL INVESTMENT FDR DOMESTIC COAL CHAIN:
           WESTERN UNITED STATES TO WEST SOUTH CENTRAL POWER PLANT
                          (millions of 1980 Dollars)

                                                      a/
                         Mine          Slurry Pipeline      Power Plant

Facility Required:    25% Capacity       10% Capacity        One 800-MW
                    of 10-million      of 24.75-million      power plant
                       ton/year           ton/year
                         mine        1,400-mile pipeline
Useful Life:          20 years        About 30 years         45 years
                      or more                                or more
Initial Capital         $33               $135                  $877
  Investment:
                      Total Coal Shipped               =2.52 million Short
                                                         Tons/Year
                      Total Initial Capital Investment = $1,045
                      Capital Investment Per Ton-Year  = $415
a/  Slurry pipeline capital costs per ton are the low assumption from ICF
    report to U.S. Department of Energy entitled  The Potential Energy and
    Economic Impacts of Coal Slurry Pipelines, January 1980, Table C-7,
    page C-48 (estimates for pipeline from Wyoming to Arkansas/Oklahoma/
    Louisiana).

Source:  ICF Assessment, 1983

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                               5-11






     These two examples suggest that the dominant component of



any future capital invested in the use of coal will be the power



plants used in generating electricity.  Moreover, coal-fired



power plants cannot easily be converted to nonfossil fuels



(e.g., nuclear) and, once built, they have a relatively long



life.  Some of the new coal-fired plants now under construction



and scheduled for operation by 1990 may still be operating in



2050.  Thus, to minimize the economic impact, any policy banning



the use of coal would have to be applied prospectively to the



construction of new facilities.



     The extent to which capital is invested in coal market



chains will depend on future demand for coal.  The World Coal



Study (WOCOL) provides the most comprehensive, although arguably



optimistic, analysis of both demand and investment.   This study



concluded that approximately 740 GW of new capacity would be



built in OECD countries from 1977 to 2000, with the United



States responsible for over half of that increase (see Table



5-3).



     Using WOCOL1s prediction of the level of future OECD



economies, the likely capital committed to coal market chains can



be put in perspective (Table 5-4).  This table takes into account



the costs of mining, transporting, and burning coal  at power



plants.  It does not include industrial use of coal.  Nonethe-



less, over one trillion dollars or approximately 2.3 percent of



the projected total OECD economy — would be committed to the

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                              5-12
                           Table 5-3

          WOCOL FORECASTED NET ADDITIONS OF COAL-FIRED
           POWER PLANTS IN OECD COUNTRIES: 1977-2000
OECD Countries

Australia
Canada
Denmark
Finland
France
Germany, F.R.
Italy
Japan
Netherlands
Sweden
United Kingdom
United States
Other Western Europe

      OECD TOTAL
Cumulative Coal-Fired Capacity Additions
Capacity           Capital Investment
  (GW)         (billions of 1980 Dollars)
   49
   49
   10
    4
   20
   27
   21
   48
   16
   12
   10
  423
   53

  740
 61
 61
 12
  4
 25
 34
 26
 61
 20
 15
 12
533
 67

931
Source:  Coal-Bridge to the Future, Report of the World Coal
         Study (WOCOL), Ballinger, Cambridge, 1980, Table 8-3,
         page 215.

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                              5-13
                           Table 5-4

       WOCOL FORECASTED CUMULATIVE COAL CHAIN INVESTMENTS
                                        a/
            FOR WOCOL COUNTRIES IN OECD:   1977-2000
                                   Cumulative Capital
                                 (billions of 1980 Dollars)
TOTAL ECONOMY

COAL CHAIN COMPONENTS
 Supply Facilities
    Mines
    Inland Transport
    Ports
    Ships
47,923
   133
    58
    18
    45
 Consumption Facilities

    Electric Power Plants
   866
 Total                                     1,120

COAL CHAIN AS PERCENT OF TOTAL ECONOMY      2.3%
a/ Consists of the following countries: Australia, Canada,
   Denmark, Finland, France, Federal Republic of Germany,
   Italy, Japan, Netherlands, Sweden, United Kingdom, United
   States.
Source:  Coal-Bridge to the Future, Report of the World Coal
         Study (WOCOL), Ballinger, Cambridge, 1980, Table 8-1,
         Table 8-3, pages 212-215.

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                               5-14





coal market chain during this time period.  This example further



illustrates the size of the potential economic dislocation if a



ban on the use of coal is adopted by the turn of the century.






EFFECTS OF BANS ON SHALE OIL AND SYNFUELS



     The examples used until now have focused on coal because



the results in Chapter 4 indicate that, if we are to signifi-



cantly delay a 2°C rise in temperature, a ban on coal by the



year 2000 is the only effective means of accomplishing that end.



Longer run temperature concerns extend beyond coal to include



prohibitions on shale oil and synfuels as an alternative to coal.



     Coal liquifaction would, of course, be prohibited by a ban



on the use of coal.  Similarly, a future ban on shale oil would



affect very few existing facilities.  The purpose of examining



their production costs is to illustrate the quantity of required



capital and the expected useful life of these facilities in the



absence of future bans on coal and shale oil.  If prohibitions



are instituted soon, the primary loss would be the research and



development costs invested in these industries to date.  Moreover,



if the industries do reach commercialization, future efforts at



limiting use of their products would prove more difficult to



implement and may involve premature retirement of the associated



infrastructure.



     Although costs for producing shale oil remain somewhat



speculative, the initial capital costs for a facility producing



50 thousand barrels of oil per day are likely to be about $2.85

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                               5-15






billion (1980 dollars).  At an assumed heat content of  5.8 million



Btu per boe and 19.91 million Btu per metric ton of coal, the



cost of this shale oil facility is about $537 per annual mtce



output (ICF, 1983).



     Using the same assumptions, the capital investment in a



coal liquifaction plant would be over $967 per annual mtce out-



put or a total of $5.6 billion (1980 dollars) for a 50 thousand



barrel per day facility (ICF, 1983).  Each facility has an expected



useful life of thirty years.



     Producing energy from shale and coal involves far more com-



plex technologies than those now used in producing oil or gas.



As a result, the start-up time of these projects is considerably



longer, the capital involved is far greater, and, generally, the



expected life is longer.  These factors would severely limit



society's flexibility and increase its costs should future



policies limit the use of coal liquifaction and shale oil pro-



duction after these industries have become commercialized.






OTHER IMPEDIMENTS TO POLICY IMPLEMENTATION



     The long life cycles of energy projects complicate the



problem of developing an effective response to the threat of



rising CO2-  Whether that response involves adaptation or pre-



vention, the earlier a concerted strategy is implemented, the



lower the risks and costs of dealing with the CC>2 problem.  Yet



the selection of a particular response can occur only after



several time-consuming preliminary steps have been taken:

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                               5-16






scientists and other researchers must provide substantial and



convincing evidence of the likely occurence and effects of the



greenhouse warming; an international agreement must be reached



specifying a consensus response to the problem; and this response



must be implemented (see Figure 5-3).  Until these steps are



completed, few, if any, significant actions are likely to be



taken by nations concerned with rising CC>2 levels.






                             Figure 5-3



                     PROCESS LEADING TO ACTION
Consensus that
Greenhouse Warming
Must be Addressed
— >
Negotiate International
Accord which Defines
Appropriate Response
— >
Implement
Response
Measures
     Chapter 2 of this report discussed efforts to isolate, from



the record of general climatic trends, any warming directly



attributable to greenhouse gases. Some researchers anticipate



that, by the beginning of the next decade, they will have suc-



cessfully demonstrated the magnitude of the relationship between



warming and the concentration of greenhouse gases.  Initial



recognition by individual researchers, however, falls far short



of an international scientific consensus.



     Efforts at reaching a consensus among political leaders to



act on the CO2 problem may prove even more difficult.  A number



of international organizations including the World Meterological

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                                5-17





Society, the International Institute of Applied Systems Analysis,



and the United Nations Environment Program, have been actively



researching the problem, and have convened several conferences



during the past decade.  Despite these activities, the prospects



for any future international accord remains uncertain.  In



general, environmental issues have not readily produced an



international consensus.  Acid rain and stratospheric ozone



depletion are two recent examples where transboundary pollutants



were involved, and where no international consensus on appropriate



responses was forthcoming.  In these cases, as is true with CC>2,



countries are able to point to lingering uncertainties in the



scientifip evidence as the basis for inaction or delay.



     Economic considerations may also play a role in the failure



to reach a consensus.  In the case of both acid rain and ozone



depletion, some countries would be required to incur greater



costs than others.  As the analysis of fossil fuel resources



presented earlier in this chapter clearly illustrates, this will



almost certainly be true should there be a future ban on coal or



shale oil.



     The problem of inequitable distribution of costs and bene-



fits is even more acute for CO2~induced climate change, since the



consequences from such changes will differ dramatically from



country to country.  In fact, some areas of the world are likely



to experience more desirable temperatures and increased rain-



fall, and therefore would benefit from rising CC>2.  Ironically,

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                               5-18






as general circulation models improve, more information on



regional climate effects may further complicate the issue by



better identifying the winners and losers throughout the world.



     Carbon dioxide may also become a cause of conflict between



developed and developing nations.  Developed nations are cur-



rently most dependent on fossil fuels and generally possess the



largest resource base.  They have the most to lose by accepting



a policy which limits the use of these resources.  In contrast,



developing nations are most in need of inexpensive energy sup-



plies to provide food and to improve their standard of living.



According to the IEA/EPA model projections used in this study,



a large percent of the future increase in C02 emissions will be



the result of population and economic growth in developing



nations.  In terms of equity, however, their contribution should



probably be balanced against past increases which overwhelmingly



were the product of industrialization in the developed nations.



One international conference has already proposed that developed



countries limit their CC>2 emissions to allow for greater fossil



fuel consumption by developing nations, while still limiting



overall emissions (Bach, 1980).



     Given these competing interests, the future of any inter-



national accord remains, at best, a distant prospect.  Unfortu-



nately, the findings and conclusions of this study indicate



clearly that only an international response will be effective



in delaying significant temperature change.

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                               5-19
SUMMARY



     The above illustrations fall far short of a complete eco-



nomic and political feasibility analysis.  They do, however,



provide considerable support for the conclusion that policies



banning the use of coal are unlikely to be adopted.  The magni-



tude of the economic disruptions and need for a consensus among



the United States, China, Russia and the developing nations are



major hurdles to the adoption of a worldwide coal ban.  A ban



on shale oil or on synfuels per se may be more tractable since



large scale production of these fuels has not yet begun.  But,



even here, international cooperation is far from assured.

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                            CHAPTER 6



         NONENERGY OPTIONS FOR CONTROLLING CO? EMISSIONS






     Although most discussions of ways to reduce a greenhouse



warming focus on manipulating fuel use, researchers have proposed



several dramatically different approaches.  These include con-



trolling CC>2 emissions at the source, sequestering CO2 from  the



atmosphere, and reducing the amount of solar radiation received



at the earth's surface.  Each of these alternatives is reviewed



in this chapter.  Technical and economic feasibility, and poten-



tial effectiveness are assessed.





OPTIONS FOR CONTROLLING CO? EMISSIONS



     Capturing CO2 from smokestacks would be a more direct means



of limiting its buildup in the atmosphere than switching to  alter-



native energy sources.  Many countries have successfully used



emission controls to limit the adverse effects of a variety  of



pollutants from industrial processes.  Firms are frequently



required to install control equipment or alter production pro-



cesses to reduce emissions below quantities that will harm the



public's health or welfare.



     A plan to control CO2 emissions would appear attractive for



several reasons.  First, if the CO2 problem could be remedied



through emission controls, there would no longer be any need to



consider potentially disruptive changes in fuel-use patterns.

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                              6-2






Alternatively, controlling CC>2 emissions could be an easier means



of .accommodation than making the required social and economic



adaptations to a warming climate.  Second, requiring those sources



emitting carbon dioxide to bear the burden of controlling their



emissions represents an equitable solution to the problem.  Third,



an emission control approach would satisfy those who favor a tech-



nologic "fix" to environmental problems.  Finally, the potential



to quickly install controls on many sources of CC>2 would allow us



to become more certain about the severity of the CC>2 problem



before taking action.



     Applying pollution controls (scrubbers) on major stationary



sources tp limit CC>2 emissions was first proposed by C. Marchetti



in an article in Climate Change in 1977.  Once CC>2 was captured,



Marchetti proposed to inject it deep into the ocean where it



would be carried to lower layers by natural currents.  Entrapped



CC>2 would thus be removed from the atmosphere for centuries.



     Brookhaven National Laboratory (Albanese, 1980) examined



several alternatives for controlling and disposing of carbon



dioxide from coal-fired power plants.  These plants, however,



account for only approximately 30% of current fossil fuel emis-



sions in this countury and even less worldwide.



     The only feasible control option used a chemical solvent —



monoethanolamine (MEA) — to absorb CC>2 from smokestack emissions.



Alban.ese also compared three methods for disposing of captured



CC>2: conversion into a gas, liquid, or solid blocks, each of which



would be deposited into deep layers of the oceans.

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                              6-3






     As shown in Table 6-1, the capital costs of an MEA  control



system installed at a new 200-MW power plant were estimated  to



be $46-$216 million (1980 $) for 50 percent removal efficiency



and $68-$290 million for 90 percent efficiency, depending on the



method of CC>2 disposal.  These costs  include the removal and



recovery systems (which capture CC^), and the significantly



more expensive facilities required to transport and dispose  of



the captured CC>2.



     They do not, however,  include the costs of supplying energy



to operate the scrubbing and disposal systems.  As Table 6-1  indi-



cates, the effective capacity of the power plant would drop  by up



to one-third for 50 percent CO2 control and by up to roughly four-



fifths for 90 percent control.  This reduction in capacity reflects



the energy penalty of the CC>2 scrubbing and disposal system.



     Overall, the least expensive option for both 50 percent  and



90 percent flue gas removal efficiency is gaseous disposal.   (See



"Electricity Generation Costs" in Table 6-1.)  Even for this



method of disposal, however, the cost increase is high enough to



seriously question the economic feasibility of controlling CC>2



using today's technologies.  These increases would almost double



electricity costs for 50 percent removal and would increase  costs



by a factor of four to achieve 90 percent efficiency.



     As high as these costs are, they underestimate the real



costs for several reasons.  As noted earlier, utilities contribute



only 30 percent of C02 emissions in the United States and an even

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                                                    TABLE  6-1

                                Costs of  Generating  Electricity With and Without G>> Control
                                for Initial  Power Plant Capacity of 200-MW(e)  (1980 dollars)

Net capacity, (D MW(e)
Capital investment (million $)
(a) Power plant (2)
(b) C02 control system*-3'
Total
Energy penalty for operating CC>2
Controls MW(e)
Total operating costs (4) (million $)
(a) Coal @ $30/ton
(b) O&M
(c) Barging costs (5,6)
(d) Capital charges @ 15% of
capital investment
Total
Electricity generation costs,
Mills/kWh (revenue requirements)
SC>2 removal with
no CO? control
200
160
160
18.9
4.8
24.0
47.7
30
SC>2 removed
Gaseous
disposal
161
160
152
312
39
18.9
5.8
46.8
71.5
56
+ 50% C02 <
Liquid
disposal
159
160
216
376
41
18.9
5.8
56.4
81.1
64
x>ntrol
Solid
disposal
134
160
46
206
66
18.9
7.2
5.0
30.9
62.0
58
SC>2 removed
Gaseous
disposal
86
160
194
354
114
18.9
5.8
53.1
77.8
113
+ 90% CO2
Liquid
disposal
83
160
290
450
117
18.9
5.8
67.5
92.2
139
control
Solid
disposal
37
160
68
228
163
18.9
7.2
5.0
34.2
65.3
221
 (1)   Electrical  energy  to drive  the CO?  control system  is assumed to be obtained from the electrical output of the power
      plant.   Therefore:  enet = ^ross^OO MWe) -
 (2)   Total  capital  investment  @ $800/kW(e),  including sulfur removal equipment.

 (3)   Total  capital  investment  @ 1.2 times  fixed capital  investment.

 (4)   Based  on 8,000 hours of operation per year.

 (5)   Dry-ice barging costs @ $15,000 per day.  Costs for transporting dry  ice from power plant to barge are not included.

 (6)   Barging costs  are based on a 100-mile barging distance (500-meter disposal depth).  For a 200-mile distance
      (3000-meter disposal depth), barging  costs are estimated at $9 million per year.
SOURCE:  Albanese, Environmental Control Technology pg. 44.

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                               6-5


smaller percentage worldwide.  Thus, the effectiveness of  such

an approach is dubious.  Moreover, the above analysis applies

only to control costs at new power plants located near large

bodies of water.  Costs would be considerably higher to control

CC>2 emissions at other types of power plants and at industrial

sources.  Thus, controlling CO2 emissions appears to be marginally

effective and prohibitively expensive.


SEQUESTERING CO? USING TREES

     If the costs of installing and operating CO2 controls are

prohibitive, one potentially attractive alternative is to  reduce

CC>2 after it has been emitted.  By storing or sequestering the

carbon through tree growth, an existing sink of CC>2 would  be

expanded.*

     The first notion of using trees to reduce atmospheric C02

was developed in 1976 by the noted physicist Freeman Dyson.

Dyson simply set forth the technical parameters of using trees

to sequester CC>2r and concluded that "there seems to be no law

of physics or of ecology that would prevent us from taking action

to halt or reverse the growth of atmospheric CO2..." (Dyson, 1976).
*  Some researchers have  suggested  that the  trees should be cut
   and pickled  in a manner  that prevents their decomposition
   and the release of carbon  to the atmosphere.  Because of
   other problems that must be overcome first, we have not
   analyzed this aspect of  the proposal.

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                               6-6






More recent analyses used Dyson's concepts as a starting point,



and examined in greater detail the feasibility of planting trees



on the scale required to absorb sufficient quantities of CC>2 to



limit or delay a global warming.



     Sequestering CC>2 through forestation is attractive because it



offers a decentralized solution to a global problem.  Many coun-



tries could contribute to a forestation effort.  This is in direct



contrast to the energy options, which would fall most heavily on



those few countries with most of the world's fossil fuel resources.



     Tree planting is also attractive in its own right as a means



of reversing past trends of deforestation.  In many areas of the



world, the growth of forests will help reestablish the nutrients



in soil, prevent runoff, and stop the spread of deserts.



     Despite the potential benefits of widespread forestation,



none of the earlier proponents of this idea now believes that it



is feasible (Greenberg, 1982).  As illustrated below, the magni-



tude of the reforestation effort required appears to make this



approach untenable.



     LAND REQUIREMENTS



     Based on Dyson's original proposal, American sycamore seed-



lings would be planted on 6.7 million km2 of land (Greenberg, 1982)



Sycamore trees were selected because they grow well in temperate



climates with a minimum of rainfall.

-------
                               6-7






     An enormous amount of land would be required to plant enough



trees to absorb substantial quantities of CC^.  Sycamores would



absorb an average 750 tons of carbon annually for each square



kilometer until a steady state is reached when the forest matures



(after about 50 years). Thus, a total of 37,500 tons of carbon



would be sequestered for each square kilometer of sycamores.  To



offset 50 years of CO2 emissions at the current annual rate



(approximately 5 billion gigatons per year of carbon from fossil



fuels), approximately 6.7 million km^ of sycamores would have



to be planted and maintained.  The required acreage would be



roughly equal to the land area of Europe.



     Identifying available land of this magnitude that is also



suitable for planting is a major problem.  Thirty-eight percent



of the world's total land is already covered with trees.   An



additional 9.5 percent is currently under cultivation and could



only be used to grow trees if food production were sacrificed



(MacDonald, 1982).  Neither could be considered available for



the purposes of planting trees to be used to sequester CC^.



Much of the remaining land consists of desert, rock,  sand, and



ice, and therefore would not be suitable for this endeavor.



     FERTILIZER REQUIREMENTS



     The enormous quantity of fertilizer that would be needed



to grow the sycamore plantations is a second critical barrier to



a successful sequestering plan.  It would call for an estimated



17 million tons of nitrogen, 5 million tons of phosphorus (as

-------
                               6-8
P2O5), and 10 million tons of potassium (as potash, K2O).  This

represents a very large percentage of the world's current ferti-

lizer production: approximately 30 percent for nitrogen, 40 per-

cent for potash, and 15 percent for phosphate (see Table 6-2).


                            TABLE 6-2

   FERTILIZER REQUIREMENTS FOR GROWING AMERICAN SYCAMORE TREES,
 COMPARED WITH WORLD FERTILIZER PRODUCTION JULY 1979-JUNE 1980
                   (in millions of metric tons)
Quantity of
Fertilizer World
Fertilizer Required Production
N 17 59.8
K2O 10 25.7
P2O5 5 32.3
Requirements as of %
of World Production
28.4%
38.9%
15.5%
Source:  Minerals Yearbook, 1978-79.


     Today's production figures do not clearly indicate the poten-

tial of the world's producers to raise output over time should

future demand increase substantially.  This analysis requires a

closer examination of unused capacity and of the costs and avail-

ability of the inputs to produce each fertilizer.

     Worldwide capacity to produce nitrogen fertilizer currently

stands at about 80 million metric tons (about 20 million tons

above current production).  It is expected to increase to about

100 million tons by the end of the decade. Thus, there is enough

currently unused capacity to satisfy the needs of a sycamore

-------
                                6-9






plantation, and planned  capacity  expansion  in  the  industry



suggests sufficient flexibility to  respond  to  future  increases



in demand.  However,  it  is not  at all  clear that future  increases



in capacity would be  committed  to growing sycamores.   A  significant



percentage would probably be diverted  to increasing agricultural



productivity throughout  the world.



     World potash capacity also appears adequate to meet  future



demands.  Known reserves in the U.S.S.R, Canada, and  New  Mexico



would be sufficient to supply the K20  required for the sycamore



plantation, if necessary.  Moreover, Canada  alone expects  to



nearly double its annual production between  1980 and  1990  from 11



million to 18 million tons (Harve,  1982), again demonstrating



flexibility to meet increases in  demand.



     The situation is less encouraging for phosphate  requirements.



The United States and Morocco are the  chief producers of phosphate



rock.  At current rates of consumption, reserves seem adequate



only for the next 20 years.  With a 15 percent increase in con-'



sumption resulting from the demands of the sycamore plantation,



known reserves would be exhausted several years sooner.  Unless



new resources are located, scarcity could become a significant



problem (Minerals Yearbook, 1978-79).



     COSTS OF SEQUESTERING



     To further evaluate the viability of a CC>2 sequestering



program, resource requirements  for supporting the program should



be translated into costs.  Data on the costs of large-scale tree-

-------
                              6-10





planting programs are drawn from studies examining the feasibility



of creating tree farms to produce biomass for energy consumption.



     One such study examined in detail the potential for growing



leucaenas on tree farms in Hawaii (Brewbaker, 1980).  Although



leucaenas could grow well only in tropical climates throughout



the world, they are an attractive species for limiting increases



in CC>2 because they consume carbon at a higher rate (11.8 dry



weight tons of carbon per acre of wood) than American sycamores.



These trees could sequester 2,827 tons carbon/km2/year until the



forests matured.  To sequester the same 50 years of carbon emis-



sions at the current annual rate, 1.77 million km2 of land would



have to be planted with leucaenas.  This acreage is only 25 percent



of that required for the American sycamore, but would have to be



drawn from the more limited tropical areas of the globe.



     Fertilizer requirements, shown with their percentage of world



production, are illustrated in Table 6-3.  Because the leucaena



is a nitrogen-fixing legume, additional nitrogen fertilizer is



not necessary.  But, it requires more than twice as much as the



sycamore of the fertilizer in the shortest supply — phosphate.



     To grow at the optimal rate, leucaenas need about 60 inches



of rain a year.  Hawaii gets about half that amount annually; the



remainder would have to be made up by irrigation.  Assuming all



planted areas would have a climate similar to Hawaii, irrigation



equipment to move the required 365,190 billion gallons of water a



year would be required.  Brewbaker estimated the cost of installing

-------
                               6-11
                            TABLE 6-3

           FERTILIZER REQUIREMENTS FOR GIANT LEUCAENA,
           COMPARED WITH U.S./CANADA AND WORLD PRODUCTION
                      FERTILIZER PRODUCTION
                      July 1978 - June 1979
                   (in millions of metric tons)
P205
K2O
CaCO3
Sulfur
Fertilizer
Requirements
for Leucaenas
11.9
8.7
1.0
0.7
World
Production
32.3
25.7
-
-
Require-
ments as a
% of World
Production
36.8
33.9
-
-
Source:  Greenberg, 1982


a system to handle this amount of water to be $600/acre (1980 $)

for equipment, and $78.40/acre/year for water and services.   The

total irrigation system for the entire plantation would require

a capital investment of §262 billion and annual operating expenses

of $34 billion.

     The cost to purchase land is also substantial.  On the

Hawaiian Island of Molakai, land costs are very high and not

representative of average global costs.  They would run about

$3,000/acre to buy or $100/acre to lease, which results in a

one-time expense of $1,311 billion, or annual payments of $34

billion.  Even if land prices were one-tenth these costs, or $300/

acre (lease payments of $10/acre), the costs would be $131 billion

-------
                               6-12


to buy or $4 billion a year to lease.  Preparing the land after

purchase was estimated to cost another $55 per acre, or a total

of $25 billion (Brewbaker, 1980).*

     Based only on land and irrigation costs, a total initial

cost of over $400 billion would be required.  When added to the

costs for pesticides, fertilizers, nursery facilities, storage

and other requirements, a leucaena plantation would be exorbitantly

expensive.

     Availability of land, total costs, and energy requirements

are not the only considerations in evaluating proposals to use

trees to sequester carbon.  Any undertaking of this magnitude

will itself affect the world's climate.  For example, by planting

trees on what is now fallow land, we will significantly alter

the earth's albedo (reflective characteristic) — more of the

sun's energy will be absorbed by the earth.  Marchetti

estimates a 20 percent reduction in reflectivity (1978), thus

increasing the earth's temperature.  The resulting temperature

rise would be roughly equivalent to the amount of CO2 emitted

during a seven-year period at current CC>2 emission rates

(Greenberg, 1982).
*  This figure agrees with the $50/acre land preparation costs
   estimated,in a similar study (Eraser, et al., 1976).

-------
                               6-13


     In conclusion, rudimentary analysis of proposals  found  in

the literature and extrapolations from energy tree-farm work

show that sequestering atmospheric CC>2 by trees  is an  extremely

expensive, essentially infeasible option for controlling CO2-


OFFSETTING THE GREENHOUSE WARMING

     In contrast to actions that control or capture CC>2 emis-

sions, an alternative proposal is directed at reducing the amount

of solar radiation that penetrates the troposphere.*   Under this

proposal, large quantities of sulfur dioxide injected  into the

stratophere would reduce solar radiance about 2  percent by

absorbing incoming visible sunlight.  This reduction in incoming

radiation would roughly neutralize the warming created by a CC>2

doubling.

     Depositing the required 35 million tons/year of SC>2 in the

stratosphere would require 750-800 daily airplane flights.  To-

gether with the costs of the sulfur dioxide, total costs would

be roughly $21 billion/year (Broecker, 1983).

     Costs aside, the practicality of such a scheme depends pri-

marily on the associated environmental effects.  Adding sizable

quantities of SC>2 to the stratosphere may affect many  chemical
*  This proposal was first suggested by Budyko (1974).  A recent
   paper by Broecker (1983) provides a preliminary analysis of
   the costs and environmental implications of this approach to
   counteracting a greenhouse warming.

-------
                               6-14


reactions in the stratosphere, including those that control the

concentrations of ozone and ^0.*  Changes in these gases could

significantly contribute to a warming.  It could also increase

acid rainfall in the troposphere.  Much more analysis of each of

these effects is required before the feasibility of this proposal

can be judged.


SUMMARY

     Current proposals to slow a greenhouse warming by nonenergy

means generally do not appear effective or feasible.  At best,

they require additional analyses before even tentative conclusions

can be reached.  Nonetheless, they retain their appeal if for

no other reason than energy options appear to be economically

and politically unacceptable.

     Of the three proposals reviewed in this chapter, the seques-

tering may hold some promise, but only if new biological organisms

can be developed.  Such organisms would have to be capable of

absorbing large quantities of CC>2 at low cost, and without adver-

sely effecting fragile ecosystems.  Until such time, however,

sequestering cannot be viewed as a feasible solution.

     Injecting SC>2 into the atmosphere is an intriging proposal,

but raises questions about costs and adverse environmental effects.

Much more research is needed.
*  Broecker projects a 2.5 fold increase in atmospheric N20, which
   is also a greenhouse gas.

-------
                            CHAPTER 7

                           CONCLUSIONS


     Based on the evidence marshalled to date, some warming of

the lower atmosphere over the next century from increasing levels

of C02 and other greenhouse gases seems inevitable.  The only

questions remaining are how large the temperature rise will be

and how fast it will occur.  These questions are critical.  The

consequences of a greenhouse warming and related societal re-

sponses will depend strongly on both the size and the speed of

temperature rise.


EFFECTIVENESS OF POLICIES AND SENSITIVITY OF RESULTS

     The timing of a projected 2°C rise in temperature is the

primary yardstick used to judge the effectiveness of alternative

policies aimed at delaying a greenhouse warming.  The magnitude

of global warming in 2100 is a secondary measure.  In addition to

policy effectiveness, we extensively explored the sensitivity of

temperature estimates to current scientific uncertainties.

     In the Mid-range Baseline, a 2°C warming is reached in 2040.

Figure 7-1 compares this case with the results for alternative

baseline, sensitivity, and policy scenarios.  The main conclusions

are:

     •  The future mix of fuel use has almost no effect on the
        date of a 2°C warming.  Neither reductions in energy
        use (e.g., increased conservation) nor increases in the
        use of fossil fuels would appreciably change the timing
        of a 2°C rise.

-------
                                                      FIGURE 7-1

                                  CHANGES IN THE DATE OF A 2° C WARMING
                                     (PROJECTED DATE IN MID-RANGE BASELINE: 2040)
                      ALTERNATIVE ENERGY
                            BASELINES
               2070
(MID-RANGE CASE) 2040*
               2025
                              5 YRS   5 YRS
                                                    HIGH
                                                   GROWTH
TEMPERATURE
 SENSITIVITY t
 25 YRS
                        HIGH   HIGH   LOW       NO
                        FOSSIL ELECTRIC DEMAND   GROWTH
                                                                    HIGH
                                                                             5 YRS
                                                              LOW
ENERGY POLICIES
                                                                                          25 YRS
                                                                                   15 YRS
                                                                                                5 YRS  < 5 YRS
                                                                                                                      to
                                                                   10 YRS
                                                   15 YRS
                 BAN ON
                 SHALE
                  AND
                  SYN-
                  FUELS
BAN ON
 COAL
BAN ON
 COAL
  AND
 SHALE
 300%   100%
WORLD WORLD
FOSSIL FOSSIL
 FUEL   FUEL
 TAX   TAX
  •REFERS TO GREENHOUSE GASES OTHER THAN CO2: NITROUS OXIDE, METHANE, AND CHLOROFLUOROCARBONS.

  tREFERS TO THE TEMPERATURE RISE IN RESPONSE TO A GIVEN INCREASE IN GREENHOUSE GASES
   ONCE AN EQUILIBRIUM HAS BEEN REACHED.

-------
                               7-3
     •  Of the energy policy options analyzed, a ban on coal
        instituted in 2000 would effectively delay a 2°C
        warming by 15 years.  Bans on both coal and shale oil
        would result in a 25-year delay.  Taxes on all fossil
        fuels, or bans on individual fuels other than coal pro-
        duce only minor delays and are not considered effective.
        For example, a 300% U.S. tax on fossil fuels would have
        almost no effect on shifting the date of a 2°C warming;
        a worldwide tax at this level would only delay the warming
        by about 5 years.  Similarly, a 100% tax applied worldwide
        would delay the date of a 2°C rise by less than 5 years.

     •  Different assumptions about other greenhouse gases and
        the actual temperature sensitivity of the atmosphere to
        increases in CC>2 are by far the most significant factors
        in projecting the timing of a 2°C rise.  Assuming green-
        house gases (other than CC>2) remain at constant levels
        delays the projected date of a 2°C warming by 30 years.
        If these gases increase at a much higher rate than in
        the Mid-range Baseline, a 2°C warming might occur as soon
        as 2025.  Using the probable range of values for the
        temperature sensitivity of the atmosphere (from 1.5°C to
        4.5°C) delays the target date 25 years or advances it 10
        years (respectively).

     A similar comparison of results using the projected tempera-

ture in 2100 also proves insightful, although less confidence can

be placed in these very long-term projections.  The estimated

temperature in the Mid-range Baseline is 5°C.  Figure 7-2 summarizes

results for other baselines, changed assumptions, and energy policy

scenarios.

     Several useful, albeit tentative, conclusions can be drawn:

     •  Alternative assumptions about future energy patterns
        contribute negligibly to variations in projected
        temperature in 2100.

     •  Policy options that involve bans on fossil fuels could
        significantly reduce the warming by 2100. A ban on coal
        would reduce the temperature rise in 2100 from 5°C to
        3.4°C; when coupled with a ban on shale oil, the total
        projected warming would be cut in half (to 2.5°C).

-------
                                                            FIGURE 7-2
                                      CHANGES IN TEMPERATURE PROJECTED FOR 2100

                                         (PROJECTED MID-RANGE BASELINE TEMPERATURE: 5° C)
                8° Cr
(MID-RANGE CASE)  5° C
                2° CL.
                        ALTERNATIVE ENERGY
                              BASELINES
                          +0.30   HIGH    LOW
                              ELECTRIC DEMAND
  NO
GROWTH
                         HIGH
                         FOSSIL   -°-6°
                                      -0.7°
                TEMPERATURE
                  SENSITIVITY*
                                                                        +1.2°
LOW
        HIGH
       GROWTH
                                                 -1.6°
                     ENERGY POLICIES
                    100%    100%
             BAN ON WORLD   U.S.
              COAL  FOSSIL  FOSSIL
BAN ON  BAN ON  AND   FUEL   FUEL
SHALE   COAL   SHALE  TAX   TAX
                                                                        HIGH
               -0.6°
                                                                                       -1.6°
                    I   I
                    -0.7°
                                                                                             -2.5°
                  -2.9°
                                        -0.2°
              •REFERS TO GREENHOUSE GASES OTHER THAN CO2; NITROUS OXIDE, METHANE, AND CHLOROFLUOROCARBONS.

               tREFERS TO THE TEMPERATURE RISE IN RESPONSE TO A GIVEN INCREASE IN GREENHOUSE GASES
               ONCE AN EQUILIBRIUM HAS BEEN REACHED.

-------
                               7-5
     •  Neither a U.S. nor a worldwide tax on fossil fuels
        (even a tax of 300%) would be as effective as selected
        fuel  bans.

     •  Uncertainties regarding the growth in greenhouse gases
        other than CC>2 and the temperature sensitivity of the
        atmosphere are major sources of variability in projected
        temperature.
FEASIBILITY OF POLICY OPTIONS

     Though a ban on coal (or coal and shale oil) is the only

policy that could significantly delay a 2°C warming, it appears

to be economically and politically infeasible.  This is due to

(1) the substantial costs of these policies, (2) the unequal

distribution of costs and benefits across nations, and (3) the

need for worldwide cooperation to ensure their effectiveness.

     We also found other efforts to reduce CO2 levels to be

infeasible, at least at present.  Scrubbing C02 emissions has

limited applicability — it only applies to large power plants

— and is prohibitively expensive.  Forestation, on the scale

required to absorb significant amounts of CO2f would cause severe

competition for available land, fertilizer, and irrigation.

Injecting SO2 into the stratosphere to increase reflection of

incoming solar energy appears somewhat more practical (although

still expensive), but major uncertainties regarding environmental

side effects remain to be investigated.

-------
                               7-6


MODELING ASSUMPTIONS

     We made numerous assumptions and approximations, which

moderate the strength of our conclusions.  The most important

assumptions are:

     •  Worldwide population is assumed to reach zero growth
        levels by 2075.

     •  The projections of future fuel-use patterns assume
        that no exotic energy technologies (e.g., nuclear
        fusion, solar production of hydrogen, "energy plants")
        would be commercially available within the 120-year
        time frame of this study.

     •  Possible reductions in energy demand due to lower
        heating requirements as the earth warms were assumed
        negligible.

     •  The heat diffusivity of the ocean was set at 1.18
        cm^/sec, and the effects of volcanic activity and
        variations in solar luminosity were assumed to follow
        historical patterns.

No attempt was made to evaluate the significance of these assump-

tions in quantitative terms.  In our opinion, however, the assump-

tions are reasonable "educated guesses".

     Two other key assumptions were subjected to a limited sensi-

tivity analysis.  These are the rate of economic growth in the

less developed and developing countries after 2050, and the income

(or GNP) elasticity of energy demand.  In both cases, changing

the value of these paramenters within reasonable ranges produced

only minor changes in projected temperature.

-------
                                7-7






IMPLICATIONS OF  FINDINGS



     Our findings  support  the  conclusion that  a  global  greenhouse



warming is  neither trivial  nor just  a  long-term  problem.   They



•also- underscore  the large  degree  of  uncertainty  embedded  in the



temperature projections.   Taken together,  these  characteristics



of our results point to the need  for additional  research  aimed



at reducing the  range of uncertainty in  temperature  projections.



Specific research  needs should focus on  (1)  how  atmospheric



temperature responds to changes in greenhouse  gases  (i.e.,



narrowing the range of the temperature sensitivity parameter,  Te),



-and  (2) the sources,  fate,  and effects of  greenhouse gases  other



than CC>2 (specifically, nitrous oxide, methane,  CCl2^2  and  CC^F).



     But even with better  knowledge  of the magnitude and  pace  of



global warming,  we will still  be  faced with  the  challenge of



developing  appropriate responses.  Innovative  thinking  and



strategy-building  are sorely needed.   Means  must be  found to



explore the advantages of  climate change where they  appear, and



to minimize the  adverse effects.



     Finally, our  findings call for  an expeditious response.



A 2°C increase in  temperature  by  (or perhaps well before) the



middle of the next century leaves us only  a  few  decades to  plan



for  and cope with  a change in  habitability in  many geographic



regions.  Changes  by the end of the  21st century could  be cata-



strophic taken in  the context  of  today's world.  A soberness



and  sense of urgency should underlie our response to a  greenhouse




warming.

-------
                            APPENDIX A



                      ENERGY SUPPLY OPTIONS






     The mix of fuels employed to satisfy energy demands varies



considerably among geographic regions and is likely to shift



substantially over the next several decades.  Table A-l is a



compilation of energy production by fuel type in 1979 for the



United States, the developed and developing market economy



countries, the centrally planned countries, and the world.  As



shown, all nations are heavily dependent on fossil fuels; solids



(mainly coal) are the primary fuels produced in all developed



countries, while liquids predominate in the developing countries.



This reflects both the domestic demand for these fuels and the



relative abundance in each country.  Electricity is primarily



important in the developed part of the world, with nuclear power



important only in the countries with developed market economies.



     Not identified separately in this table are gases and liquids



made from biomass and coal, use of biomass as a solid fuel,  passive



solar applications, and decentralized use of active solar systems.



Biomass is a large source of energy in many developing countries,



while all forms of active and passive solar systems are growing



in popularity in the developed nations.  In addition, a variety



of new fuel sources and energy production technologies have



appeared on the horizon.  Key characteristics of both traditional

-------
                                               A-2



                                            TABLE A-l

                               WORLDWIDE ENERGY PRODUCTION IN 1979
                               Primary Energy Production (EJ)£/
Region

U.S.
Solids

17.8
Developed Market   32.7
Economies

Developing Market   3.6
Economies

Centrally Planned  44.0
Economies
World
80.2
Liquids  Gases

 20.4    21.1

 29.9    32.0


 77.1     5.0


 30.5    16.9


137.5    54.0
  Electricity (GWh)
Nuclear  Other  Total
0.3

0.5


  0


0.1


0.6
2.0

4.7


0.8


1.9


7.4
2.3

5.2


0.8


2.0


8.0
Total


 61.2

100.5


 87.0


 92.7


280.2
a/ Production for all fuels except electricity is in units of primary energy; for electricity,
~  production is in units of final energy.

Source:  United Nations, Dept. of International Ecnomic and Social Affairs,
         (1981), Yearbook of World Energy Statistics, 1979, U.N., New York,
         N.Y.

-------
                              A-3


and emerging fuel sources, and their likely utilization into the

next century are discussed below.*


CURRENT AND FORESEEABLE ENERGY SOURCES
     Table A-2 summarizes the current estimates of energy sources

which are likely to predominate throughout the next century.  As

indicated, it appears that conventional sources of oil and gas

will continue to fuel world economies at least until the turn of

the century, and that coal will gain an increasing share of the

market throughout the next century.  The high demand for liquid

and gaseous fuels is likely to continue, due to their high energy

content, transportability, storability, and utilization in end

use technologies.  As conventional supplies of oil and gas become

increasingly expensive, unconventional oil and gas supplies and

synthetic fuels from biomass and coal become economically more

attractive.  Use of non-fossil energy sources will also grow.

Nuclear and solar fuels should gain a larger share of the electric

market, although expansion of nuclear power on a sustainable basis

depends on development of breeder technology.  Solar applications

in the residential and commercial sectors will continue to grow.

The degree to which these trends materialize will depend in part,

on continued reduction in the cost of shale oil, synthetic fuel,

and solar options.
*  For more  information on energy supplies, see, for example,
   Anderer,  et al,  1981.  Much of the information presented
   here  is taken  from  this source.

-------
                                                         A-4


                                                      TABLE A-2

                                             SUVIMARY OF ENERGY SUPPLIES
Energy Category

Conventional Gas



Unconventional Gas
Conventional Oil
Unconventional Oil
Coal (Solid)


Bicmass (Solid)
Specified Fuel Types

Gas recoverable with
traditional procedures
Gas in geopressure zones
and tight formations
Oil recoverable with
traditional procedures
Heavy oil needing
enhanced recovery, tar
sand oil, shale oil
Coal used as a solid
fuel

Bionass from energy
farms and wastes, used
as solid fuel
Location of Major Deposits

Middle East, Africa, Eastern
Europe, USSR, North America
Same as conventional gas
resources
Middle East, Africa, North
America, Western Europe,
USSR

Broadly distributed with
2/3 of shale oil in North
America
U.S., China, USSR


Widely distributed
Supply Levels

About 9,500 EJ
Perhaps 9,000-
31,000 EJ
About 12,500 EJ
About 12,500 EJ
of heavy and tar
sand oil, and
about 16,000 EJ
of shale oil
About 95,000 EJ
About 160 EJ/yr
fron crops and
perhaps 30 EJ/yr
from waste
Comments

Production
should peak
after 2000

More explo-
ration is
needed to
map these
deposits

Production
should peak
before 2000

Production
costs are
considerably
higher than
for conven-
tional oil
Availability
of  land,
conpetition
with food
uses, and
production
costs limit
 its use

-------
                                                      A-5
                                             TABLE A-2 (Continued)
Energy Category

Synthetic Fuels
Specified Fuel Types

Liquids and gases frcm
coal and biotiass
Location of Major Deposits

See Coal and Bionass
Solar
Res idential/conmercial
applications (passive
and active), centralized
solar electric
Dependent on the amount of
solar radiation
Nuclear
Uranium ore
Supply Levels

See Coal  and
Bionass
Availability
of land does
not appear to
be limiting
(10 million km2
may be available)
Comnents

Availability
is related
to produc-
tion costs.
Coal-derived
synfuels
appear less
costly than
biomass syn-
fuels

Res./com.
applications
are wide-
spread, high
capital
costs limit
solar-
electric
Africa, Southeast Asia, North
America, USSR, E. Europe,  Latin
America
Depends on nuclear
technology (fission
vs. breeder)
a/ Expressed in energy equivalents of primary energy,  where appropriate.

SOURCE:  Anderer, J. et al., (1981),  Energy in a Finite World,  IIASA, Ballinger Publishing Co., Cambridge,  Mass.

-------
                               A-6






EXOTIC AND HYBRID FUEL SYSTEMS



     The farther into the future projections extend, the more



likely that totally new energy forms will come into play.



Following are currently exotic energy sources, some of which may



become commercially significant before the end of the 21st century,



     •  Nuclear Fusion — Fusion involves the extraction of



        "heavy" hydrogen (deuterium) from water and the combi-



        nation of two hydrogen atoms to form helium.  Although



        it has long been hailed as the path to unlimited energy,



        scientific feasibility has yet to be established.  Demon-



        strations of technological feasibility must then follow,



        with mastery of materials development and system



        engineering looming as major hurdles.





     •  Hydrogen — Hydrogen may become the "energy carrier of



        the future."  Most schemes for generating hydrogen are



        based on splitting water using solar energy directly



         (thermolysis or photolysis) or indirectly via electricity



         (electrolysis).  Hydrogen would then be used as  a substi-



        tute for natural gas.  Although the technical feasibility



        of water splitting on  a  large scale has yet to be estab-



        lished, a  "hydrogen economy" remains at least a  distant



        possibility.

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                          A-7






•  Solar Satellites — Collecting solar energy  in  space



   and transmitting it to earth via microwave is another



   long-range possibility.  Due to the large size  of the



   required collector, current launch and deployment costs



   render this scheme economically infeasible.  However,



   future advances in space equipment may change this



   assessment.






•  Energy Plants — Rapid improvements in bioengineering



   may provide the basis for improving the efficency or



   redirecting the end products of photosynthetic processes



   to produce commercial fuels such as hydrogen.  At this



   time, scientific feasibility of developing "super species'



   remains to be established.






•  Combinations — Concepts for combining end uses and



   supply generation facilities to better utilize waste



   heat already are being employed.  These include co-



   generation of steam and electricity and district



   heating.  Future combination may include the use of



   nuclear energy to generate heat for coal gasification



   and liquifaction.  The requisite hydrogen for synfuel



   production may be provided by splitting water with



   solar energy.  Other hybrid systems may emerge as the



   component parts become practical.

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                               A-8


ENVIRONMENTAL AND SAFETY CONSTRAINTS

     Certain supply options are likely to be constrained by nega-

tive environmental effects (other than C02 emissions).  Nuclear

power, for example, is currently facing a severe handicap due to

(1) the lack (as yet) of politically acceptable means of waste

disposal, and (2) concern over reactor safety and nuclear fuel

theft.*  The growth of the nuclear industry hinges in large part

on overcoming public fears, as well as on solving the purely

technical issues involved in waste disposal, reactor safety, and

fuel security.  Other sources of energy (1) are more environ-

mentally benign (e.g., solar), (2) are subject to technically

feasible (but perhaps costly) environmental controls (e.g., high

sulfur coal), or (3) create less visible problems (e.g.; safety

for oil rig workers).  Environmental problems resulting from

extensive use of future energy sources such as shale oil and

synthetic fuels have yet to be completely understood.  If major

problems emerge, development could be delayed.  At a minimum,

the costs of mitigating these problems will make the affected

fuels less economically attractive.
*  These problems have stymied the nuclear industry in the U.S.
   No new reactors have been ordered by utility companies since
   1978 while 60 previously planned facilities have been can-
   celled over this 5-year time period.  On the other hand,
   nuclear generating capacity has continued to grow in other
   countries.  For example, total capacity expanded from about
   50 to 70 gigawatts in all free world countries other than the
   United States (U.S. Dept. of Energy, 1981).

-------
                            APPENDIX B

              THE TEA ENERGY AND CO? EMISSION MODEL


     The IEA/ORAU,* energy and C02 emission model was developed

by Jae Edmonds and John Reilly at the Institute for Energy Analysis

as an assessment tool for policy analysis.  It provides a consis-

tent representation of economic, demographic, technical, and policy

factors as they affect energy use and production, and CC>2 emissions.

The general structure and key analytical features of the model are

described in the text.  This discussion provides a more detailed

description of the structure, data base, output, and usage of the

model, all of which are extensively documented elsewhere.**


ENERGY DEMAND

     Energy demand for each of the six major fuel categories is

developed for each of the nine regions separately.  Five major

exogenous inputs determine energy demand: population, economic

activity, technological change, energy prices, and energy taxes

and tariffs.
*  The Institute  for Energy Analysis  is part of the Oak Ridge
   Associated Universities.

** See the  following volumes: Edmonds, Reilly, and Dougher  (1981)
   and Reilly, Dougher,  and Edmonds  (1981).

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                               B-2





     An estimate of GNP for each region is used as a proxy for



both the overall level of economic activity and as an index of



income.  While the level of GNP is an input to the system, it is



derived from demographic projections of the labor age population



and an assessment of likely labor force participation rates and



levels of labor productivity.  These estimates were generated



in conjunction with Nathan Keyfitz of Harvard University and



Philander Claxton of the World Population Society.



     Improvements in energy technology beyond those induced by



real price increases or income decreases is reflected in a para-



meter called "enhanced energy efficiency".  In the past, tech-



nological- progress has had an important influence on energy use



in the manufacturing sector of advanced economies.  The inclusion



of an energy technology parameter allows scenarios to be developed



which incorporate either continued improvements or technological



stagnation as an integral part of scenarios.



     The final energy factor influencing demand is energy price.



Each region has a unique set of energy prices which are derived



from world prices (determined in the energy balance component of



the model),transportation costs, and region-specific taxes and



tariffs.  The model can be modified to accommodate non-trading



regions for any fuel or set of fuels.  It is assumed that no



trade is carried on between regions in solar, nuclear, or hydro-



electirc power, but all regions trade other types of fuels.

-------
                               B-3


     The four secondary fuels  (refined oil,  refined gas,  refined

solids [coal and biomass], and electricity)  are  consumed  to pro-

duce energy services.  In the  three OECD regions (Regions 1,  2,

and 3 in Figure 3-2), energy is  consumed by  three end-use sectors:

residential/commercial, industrial, and transport.  In the remaining

regions, final energy is  consumed by a single aggregate sector.

     The demand for energy services in each  region's end-use

sector(s) is determined by tne cost of providing these services,

and the levels of  income  and population.  The mix of secondary

fuels used to provide these services is determined by the relative

costs of providing the services  using each alternative fuel.  A

log it share function is employed to calculate these shares.

     The price of  secondary fossil fuels is  a function of the

regional price of  primary fuels  and the cost of  refining:

                        Pjr =  pir<9ij) + nj

                        Pir =  (Pi + TRir) TXir

Where:  Pjr is the price  of secondary fuel j in  region r;
        P£r is the price  of primary fuel i in region r;
        gij is the efficiency  of refining i  into j; hj is
        the non-energy cost of refining; P^  is the world
        market price of fuel i;  TRir is the  cost of
        transporting fuel i to region r, and TXir is the tax
        on fuel i  in region r.


The price of electric power is estimated as  a weighted sum of

the prices of the  alternative  electricity-generating fuels, and

the cost of energy conversion.   Likewise, the price of synthetic

oil and gas from coal and biomass are functions  of the price  of

coal  (biomass) and the cost of liquification or  gasification.

-------
                               B-4



     Prices calculated in this general manner serve as key inputs


to the demand estimation process.  Total regional demand for


secondary energy services is calculated as a function of aggregate


energy price, income level, and population (or level of economic


activity -- GNP) in each region; price and income elasticities


modulate the effect of the price and income values, respectively.


Demand is then allocated among secondary fuels using (1) historic


market shares and (2) the relative cost of providing energy services


from each fuel within, as noted above, a logit share formulation.


     For fuels which are not traded internationally (i.e., nuclear-,


solar-, and hydro-electric), demands and supplies calculated this


way are, by identity, equal.  For the other fuels, however, a


market-clearing mechanism is simulated in which prices for gas,


liquids, and solids are altered in order to balance supplies and


demands.  This is described in the Energy Balance section.



ENERGY SUPPLY


     Three generic types of energy supply categories are distin-


guished: resource-constrained conventional energy, resource-


constrained renewable energy, and unconstrained energy resources.


There are eight different supply modes across these categories as


shown in Chapter 3.  Production of conventional gas and oil are


represented by a logistics curve which reflects historic supply


levels and estimates of remaining deposits:


                      	F(fc) = exp(a + bt)
                      l-F(t)

-------
                                B-5
Where: F(t) is the cumulative  fraction  of  the  total  resource
       exported by time  t,  and a  and  b  are empirical parameters.


Production rates of  these  fuels are thus  insensitive to  price

levels.

     Production levels of  unconventional oil and  gas,  nuclear,

solar, and solids  (coal  and biomass)  are modeled  as  "backstop

technologies".  That is, a base level of production  is assumed

over time  if  real  prices remain constant.   Shorter term  supply

schedules  are then super-imposed  on these  long-term  trends  to

reflect  the increase or  decrease  in production due to  price  rises

or declines.   If  the price falls  below  a breakthrough  price  level,

then production ceases.  These relationships are  encompassed in

the following general expression:

                         P  = a  [exp(g/b)c]

Where:   P  is  the  price of  the  backstop  fuel; a is the  break-
         through price; b is a  parameter which  determines  the
         "normal"  backstop  price;  c is a price  elasticity  con-
         trol  parameter;  g  is the  ratio  of  output  in  year  t  to
         the base  level output  associated with  the backstop  price.


     Production schedules  of synthetic  oil and gas are determined

by the price  (supply schedules) of solids, the cost  of producing

the synthetic fuel,  and  associated non-energy  costs.   The share

of coal  or biomass allocated to the production of synfuels  is

specified  by  a logit share equation,  with  the  relative cost of

synfuels versus other sources  of  gas  and oil and  the price  elas-

ticity of  production as  key terms.

-------
                               B-6





     Resource-constrained renewable fuels are considered constant-



flow sources.  That is, the rates of energy production are limited



by the availability of the resource.





ENERGY BALANCE



     The supply and demand modules each generate energy supply



and demand estimates based on exogenous input assumptions and



energy prices.  If energy supply and demand match when summed



across all trading regions in each group for each fuel, then the



global energy system balances.  Such a result is unlikely at any



arbitrary set of initial energy prices.  The energy balance com-



ponent of the model is a set of rules for choosing energy prices



which, on successive attempts, brings supply and demand nearer a



system-wide balance.  Successive energy price vectors are chosen



until energy markets balance within a pre-specified bound.





CO? RELEASE



     Given the solution from the energy balance component of the



model, the calculation of CC>2 emissions rates is conceptually



straightforward.  The problem merely requires the application of



appropriate carbon coefficients (carbon release per unit of



energy) at the points in the energy flow where carbon is released.



Carbon release is associated with the consumption of oil, gas,



and coal.  Large amounts of CC>2 are released from the production



of shale oil from carbonate rock and from the production of



synthetic fuels from coal.  A zero carbon release coefficient

-------
                               B-7





is assigned to bioraass, nuclear, hydro, and solar.  The specific



coefficients used in the modelling analysis and listed in Chapter



3 were compiled by IEA from various sources, and conform to the



IEA fuel accounting conventions as shown in Figure B-l.

-------
                                     B-8
                                 FIGURE  B-l

                APPLICATION OF CO2 EMISSION  COEFFICIENTS
                              IN THE IEA MODEL
Primary
Energy
Secondary
  Energy
            Repressing Flarin8
Coal


"'S
-*. 
-------
                            APPENDIX C



                   THE ORNL CARBON CYCLE MODEL






     The Oak Ridge National Laboratory carbon cycle model repre-



sents flows and stocks of carbon on a global scale.  Terrestrial



carbon is modeled in considerable detail while ocean carbon is



represented by a simple box-diffusion concept.  A general over-



view of the model is presented here.*




     Figure C-l depicts the overall structure of the model.



Carbon in living material is divided between ground vegetation



and trees, and, within trees, between "woody" and "nonwoody"



parts.  Dead organic matter is divided between detritus/decomposer



and active soil carbon.  Finally, carbon in the ocean is subdivided



into surface (260m) and deep layers.



     For each of the carbon reservoirs, equations specify maximum



stocks of carbon and rates of flow into and out of the reservoirs.



In general, terrestrial flows are modeled as linearly dependent



on carbon content of the ith donor reservoir (F^j = a^j C^) or as



a more complicated logistics function.



     The logistic functions for trees includes a term for carbon



release to the atmosphere from forest clearing.  Permanent forest



clearing is reflected by reductions in the parameters governing



storage capacity.  Where clearing is temporary, reestablishment



of forests occurs in a delayed exponential fashion.  (The forest



clearing option was not activated for this study).
*  For a more detailed discussion see Emanuel, et al. (1981).

-------
                                  C-2



                               FIGURE C-l

             STRUCTURE OF THE ORNL GLOBAL CARBON CYCLE MODEL
ATMOSPHERE
                                                                       I
   GROUND
 VEGETATION
NONWOODY PARTS
    TREES
                             WOODY PARTS
                                TREES
                       DETRITUS/
                     DECOMPOSERS
                     ACTIVE SOIL
                       CARBON
SURFACE OCEAN
                                                                       I
                                   DEEP OCEAN
            THIS FIGURE IS TAKEN FROM AN UPDATED MANUSCRIPT BY W.R.
            EMANUEL AND OTHER AT OAK RIDGE NATIONAL LABORATORY.

-------
                               C-3






     Net uptake of carbon by  the ocean  is  limited  by  the  avail-



ability of carbonate ion.  The rate at  which gaseous  CC>2  is  dis-



solved in seawater depends on the rate  of  reaction with CO3,



which is the first step of a  process by which CC>2  is  incorporated



into various seawater carbonate compounds.



     Most,flux equations are  temperature-sensitive.   Sensitivity



to temperature is significant as a rise in temperature is the



most direct consequence of an increase  in  atmospheric C02»   The



original version of the ORNL  represented this temperature-CC>2



relationship by a simple exponential equation rather  than through



a series of heat-flux equations.  This  aspect of model was ignored



in favor of the relatively sophisticated heat flux relationships



in the GISS model.  These relationships were utilized by coupling



the two models (see the Appendix E).



     The model inputs are estimates of  fossil fuel carbon emis-



sions on a yearly or longer time period basis from 1980 until



some future year.   (The IEA model outputs  are on a 25-year basis.



Estimates were provided on a  5-year basis  by interpolating between



the 25-year estimates).  Outputs are atmospheric CC>2  for 5-year



time intervals.



     The model simulates historical patterns of carbon cycling



from 1740 to 1980 on an annual basis.   The resulting  time trend



in CO2 was modified slightly  so that the concentration in 1980



was 339 ppm.  This  corresponds to the level estimated by  the GISS



model in 1980 given estimates of fossil fuel carbon emissions  in

-------
                               C-4
1975 (the starting point of the IEA model) used in this study,



and matches observed CC>2 levels for 1980.  The model was then



run to produce estimates of atmospheric CC>2 from 1980 to 2100.

-------
                            APPENDIX D

              THE GISS ATMOSPHERIC TEMPERATURE MODEL


     The GISS model used in this study is based on a one-dimensional

(1-D) radiative-convective  (RC) model for estimating temperature

increases associated with atmospheric C02 rises.*  The 1-D, RC

model computes vertical temperature profiles over time from net

radiative and convective energy fluxes.  Radiative fluxes, in

turn, depend on changes in  atmospheric gases, especially C02-  The

GISS model is an empirical  representation of the 1-D, RC model, as

modified by  Hansen and co-workers to include terms for greenhouse

gases other  than C02.


HEAT FLUX COMPUTATIONS

     The heat flux into the earth's surface  is estimated by an

equation which contains all key temperature-related terms:

     F(t) = 2.6x10-5(AC02)   _    -  5.88x10-3  (AT) + 3.68.5x10-4  (AT) 2
           [1 + .0022(  C02)]°-6   ~T^V

          - 4.172x10-7  (AC02)  (AT) +  1.197xlQ-3 (ACH4)0-5
           -Te—

          + 5.88x10-3  (AN20)0-6  +  3.15x10-4  (ACC3) + 3.78x10-4  (ACC2)

          - 1.197x10-4  (ACH4)(AN20)  +  2.40xlO'2 (AV) +  2.10x10-3  (AV)2

          - 1.17X10-3  (AT)(AV)  + 3.184x10-1  (AS)
 *   See  Hansen,  et  al.  (1981 ).

-------
                               D-2


Where:   F(t) is the heat flux as a function of time in cal/min-cm2,
        AC02 is the change in atmospheric C02 from the 1880  value
        (293 ppm) in ppm.
        AT is the change in atmospheric temperature (surface level)
        from the 1880 value in °C
        ACH4 is the change in atmospheric CH4 from the 1880  value
        (1.6 ppm) i n ppm.
        AN20 is the change in atmospheric N20 from the 1880  value
        (0.300 ppm) in ppm.
        ACC3 is the change in CClaF from the 1880 value (0 ppb)
        in ppb.
        ACC2 is the change in CC12F2 from the 1880 value (0  ppb)
        in ppb.
        AV is the change in atmospheric optical  depth  from a base-
        line level  due to volcanic activity in dimensionless units.
        AS is the change in solar luminosity from a baseline
        level in fractional units.
         Te is the equilibrium temperature—the assumed temperature
        rise when C02 doubles from the 1880 level  (from 293  to
        586 ppm).


      The heat flux is estimated from time periods ranging  from

each  month to each year  (a semi-monthly time step was  used in this

study).  The appropri ate AT value for calculating F(t) in  each

time  period (t=n) is the value estimated for the previous  period

(t=n-l).  For a simple one-layer ocean model,  T is obtained by

solving the following differential equation:

                           dAT = F(t.)
                           ~~dT   ~t^~

Where:  C0 is the heat capacity of the mixed layer of  the  ocean
        per unit area (cal/cm2).

      Estimates of heat flux from the empirical equation described

above were compared by Lacis with the RC model calculations.  The

two estimates agreed to within one percent for  C02 values of 0 -

1220  ppm, and to within  5 percent for  C02 values of 1220-1700 ppm

(Lacis, et al., 1981).

-------
                                D-3


      Values for the parameters in the empirical heat flux equation

 were summarized in Table 3-4 and are detailed below:

         AC02: value obtained from the IEA and ORNL models
         ACH4: 1.6 ppm through 1980, increased by 2%
               per year thereafter (Recent measurements
               of methane suggest a worldwide average
               of roughly 1.6 ppm.  Concentrations are
               believed to have increased from between
               0.5% and 3.0% over the last decade; levels
               are assumed constant before 1980 as a
               simpli fi cation).
         AN20: 0.300 ppm through  1980, increased at 0.2%
               per year thereafter (This is the best
               estimate for 1980, with levels believed
               to have changed only slightly over time.)

ACC2 and ACC3: 0 before 1980, increased as shown thereafter:

                            Year        ACC2         ACC3
1980
1990
2000
201 0
2020
2030
2040
2050
2060
2070
2080
2090
2100
0.306 ppb
0.469
0.616
0.749
0.870
0.979
1.080
1.166
1.247
1.320
1.386
1.446
1.500
0.176 ppb
0. 269
0. 345
0.407
0.458
0.500
0.534
0.562
0. 585
0.604
0.619
0.632
0.642

-------
                               D-4
        (Levels  of  chlorofluorocarbons began to increase from
         zero  in  the  1940s, with  a rapid rise in the 1970s.
         The  1980 estimates are based on recent measurements.
         Assuming an  immediate  increase from zero to current
         levels  in  1980  introduces some error in temperature
         estimates  between  1950 and  1980, but does not influence
         future  estimates.)
     AV:  constant 0.007  each year from 1880 - 2100
     AS:  0 from  1880  - 2100
     Te:  1.5°C,  3.0°C,  and  4.5°C

DIFFUSION OF  HEAT IN  THE OCEAN
     The  ocean model  consists of  a mixed layer of depth Hm = 100m
and a thermocline with 63  layers  and a total depth H = 900m.  The
mixed layer temperature  is  assumed to be independent of depth,
while the thermocline temperature is defined by a diffusion equa-
tion with constant  thermal  diffusivity.  The layering is diff-
erent from that  used  in  the ORNL  model, but the difference is not
important.
     The  temperature  in  the mixed layer (ATm) is a solution of
the equation:
                             = F(t) + FD(t)
where C is the heat  capacity  of  water,  F(t) is the heat flux from
the atmosphere into  the  ocean and
                '"<*>•    -^H1     z  = Hm;
is the heat flux from the  thermocline  into the mixed  layer.

-------
                               D-5

Note that the z-axis is directed toward the bottom of the ocean.
Also, since all values are in units of g, cm, sec, and cal; heat
conductivity  x  is numerically equal to heat diffusivity K.  The
value for diffusivity was set at 1.18 cm2/sec.
     The temperature change in the thermocline (AT) is determined
by the diffusion equation:
                                      2
               C   9 AT(z,t)   = K   8AT(z,t)
                     8 t               8 zz
The boundary conditions for AT are:
                       AT - ATm  at z = Hm
and zero heat flux at the bottom of the thermocline:
                    K  8 AT = 0 at z = H  .
                       9 Z
Thus it  is assumed that no energy escapes through the lower
boundary of the thermocline.  Note that ATm and AT are temperature
changes  of the mixed layer and the thermocline between the initial
time (1880) and time t.  It is assumed that in the year 1880 ATm
= AT = 0, and thus that the ocean temperture was  in a state of
equilibrium with the atmosphere at that time.
     Required input data are atmospheric C02 levels on a  yearly
or longer time period basis.  Five-year estimates were obtained
from the ORNL, or alternatively, were obtained by multiplying a
specified retention ratio times the interpolated  5-year estimates
of carbon emissions from the IEA model.  GISS outputs are estimates
of atmospheric temperature increases on a 5-year  basis.

-------
                            APPENDIX E

          COUPLING THE ORNL AND GISS MODELS TO ESTIMATE
                       THE RETENTION RATIO


     As noted in Chapter 3, the ORNL and GISS models were coupled

in order to estimate that fraction of CO2 emitted which remains

airborne (the retention ratio).  Recall that the rationale for

coupling the models is based on (1) the temperature-sensitive

representation of carbon flows in the ORNL model, and (2)  the

superior treatment of atmospheric C02~temperature relationships

in the GISS model.  The coupling procedures are diagrammed in

Figure E-l, and are described in this appendix.


CALCULATING INITIAL TEMPERATURE VS. TIME CURVES

     The starting point is the estimation of a family of tempera-

ture-time curves using the GISS model.  These curves are employed

in the ORNL model to describe a range of future increases in

atmosperic temperature (in response to rising atmospheric CO2)

which, in turn, will affect the rate of C02 exchange among sources

and sinks.  In essence, the time trends in temperature, generated

through a more sophisticated (though still simplified) treatment

of heat flux in the GISS model, replace very simple CO2~tempera-

ture relationships in the ORNL model.

     To generate the GISS temperature-time curves, it is first

necessary to estimate an atmospheric CO2~time curve which serves

as the main driving function for the GISS model.  The most

-------
                               E-2
                            FIGURE E-l
        KEY FEATURES OF THE ORNL-GISS COUPLING METHODOLOGY
      Assumed
    Retention Ratios
 Fossil Fuel
Carbon Emissions
  vs. Time
 Giss Atmospheric
Temperature Model
                                V
  Atmospheric
  Temperature
  vs. Time
                               V V V
                           ORNL Carbon
                           Cycle Model
                         Retention Ratio
                            vs. Time
Atmospheric
CO? vs. Time

-------
                             E-3
straightforward approach is to apply a series of assumed  retention



ratios to the time trend of C02 emissions generated by  the  IEA



model.  Values from about 0.6 in 1980 to about 0.8 in 2100  were



used to generate the preliminary atmospheric COg-time curves.



     The GISS model is then run with high and low temperature -



CC>2 sensitivity (Te) values, with and without other greenhouse



gases, to produce a family of atmospheric temperature versus time



curves.  These curves are represented by a quadratic equation of



temperature versus time with parameters a and b.  The parameter



a is the temperature difference between 2100 and 1980, and  b is



the temperature difference between 2040 and 1980 divided by a.



These parameters are then used to calculate coefficients for the



quadratic equation T = ct + dt2 + 293, where T is the temperature



rise after 1980 (°K) and t is the number of years after 1980.



     Four new curves reflecting the extreme values observed



for a and b are then specified:



                               a
            Highest
            Lowest
                      Highest
Case 1
Case 3
           Lowest
Case 2
Case 4
These curves bound all possible changes in temperature given the



time trend in atmospheric CC>2 specified previously.  The four



combinations of values for a and b are then transmitted to the



ORNL model.

-------
                               E-4






CALCULATING CO? VS. TIME CURVES WITH THE ORNL MODEL



     The ORNL model is next employed to estimate future increases



in atmospheric CO2, using the fossil fuel CO2 emission scenarios



from the IEA model and the four sea surface temperature-time



trends from the GISS model.  Since four separate temperature -



time curves are employed, four separate C02~time curves are



generated as output.  Each C02 curve is represented by estimates



of atmospheric CO2 concentrations in 10-year intervals from 1980



to 2100.  Thus, a 4 by 13 matrix of values (corresponding to the



4 time vs. temperature curves and the 13 inclusive decades between



1980 and 2100) is generated as output.





ESTIMATING FINAL TEMPERATURE VS. TIME CURVES



     The four "refined"  time projections of CO2 are returned to



the GISS model to obtain a consensus temperature versus time



curve.  This is accomplished by selecting one of the CO2 curves



as a starting point.   (Tests demonstrated that starting from any



one of the four curves will yield the same result.)  The GISS



model is then run to obtain a corresponding temperature curve



from 1980 to 2100.  This temperature curve is compared with the



four temperature curves  originally generated by the GISS model



and transmitted to the ORNL model.  The new temperature curve  is



composed by  interpolating among the four previous  curves, and  a



new CO2 curve is estimated corresponding to the interpolated



temperature  curve.   (In  essence, this is a two-way interpolation

-------
                               E-5






for each 10-year interval).  The whole process is repeated until



two successive temperature curves closely approximate each other.



Usually, this takes no more than two iterations.



     To check the "accuracy" of such an iterative approach, the



final temperature-time curve from GISS was used as input to the



ORNL model for a small sample of runs.  The resulting C02~time



curve from ORNL was compared to the final CO2-time curve in GISS.



In all cases, the two agreed within 2 ppm for each 10-year



interval.






COMPUTING RETENTION RATIOS



     Once the final atmospheric CO2 vs. time curve is obtained



from the ORNL, it is divided by the C02 emissions vs. time curve



to obtain a time-trend in retention ratios.  In practice, 10-year



average values were computed.  These were then used with estimates



of 10-year average CO2 emissions (from the IEA model) to compute



10-year average atmospheric levels of C02.  These were used as



input to the GISS model for final estimates of atmospheric



temperature trends.

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                     GLOSSARY OF ENERGY UNITS
Definitions

     Btu:  British Thermal Units (Btus) are the basic energy
           units in the English System.  One Btu is the energy
           needed to raise one pound of water one degree
           farenheit.

   Joule:  Joules (J) are the basic energy units in the metric
           system.  One joule = 0.0009 Btus.
Abbreviations
     Watt-hour: Wh*
     Watt-year: Wy
     Quad: 1015 Btus
             Barrel of Oil Equivalent:  boe
             Metric Tons of Coal Equivalent:  mtce
             Cubic Feet of Gas:  ft-* gas
Prefixes
     Kilo(k): 103      Mega(M): 106     Giga(G): 109

     Terra(T): 1012    Deta(D): 1015    Exa(E): 1018
Conversions

1.0 GJ
1.0 EJ
1.0 kWy
1.0 TWy
1.0 mtce
1.0 boe
1.0 ft3 gas
0.995 x 106 Btus
0.995 Quads
31.5 GJ
31.5 EJ
29.9 GJ
6.12 GJ
1.06 x 10~3GJ
   Wh(e) means watt-hours of  electrical energy

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