Bottom-up Modeling of Sector-specific Low

Carbon Options and Technologies

John Allen Rogers

World Bank
27 January 2011, Kuala Lumpur, Malaysia
Low Carbon Development
Planning
All countries must act now (but differently) to mitigate
emissions or the 2oC trajectory is out of reach

Projected annual total global emissions (billion tons of CO2 equivalent) Low Carbon Studies:

Focused on high GHG

emitters

Asked: Is there a low

carbon option? Where is the
GHG mitigation potential?

Looked at development
objectives

Determined how to lower

carbon footprints to 2030
economically

Assessed financing needs

and other requirements
Smart Development
Involves a portfolio of cross sector adaptation and mitigation measures

Low Carbon Studies:

Need cross sector

approach

It will require strong

commitments and new
technology, finance and
capacity

National (cross ministry)

coordination essential

Countries must address

difficult barriers

It is not an easy process

 Low Carbon Development cannot be
achieved without a proper enabling
environment…
Rationalize energy, water and agricultural price, tax
Incentives incentives, fiscal and expenditure policies

Efficiency standards; codes, zoning; climate screening/

Public Outreach
Regulations proofing of investments

Capacity of public, private and financial sector institutions

Institutions
to assess and act on climate risks

Improve investment climate; deepen financial and capital

Markets markets; new markets (cap & trade, CDM)

Education, raising awareness and promoting change in

Public Outreach
consumer behavior and preferences

5
Types of Data and where to find it (Power sector only)
Required Data Ministry of Energy
The Institutional Process The Energy Commission
and Power Sector Energy Institutes and Academia
Challenges
Power Transmission and Distribution Companies

Greenhouse Gas Emission Load Dispatch Centre

Data Utilities (public and private)

Ministry of Environment
Renewable Energy Policies and UNFCCC Focal Point
Programs Designated National Authorities

Other Governmental Bodies

Supply Side Data
Planning Commissions

Regulators

Demand Side International

Data
Donors

International Finance Institutions

Oil and Gas Sector Private Sector

Data
Oil and Gas Companies
Involves Table 1 - Principal stakeholders involved in developing India’s First National Communication
Planning Commission
Ministries
Multiple
Ministry of Agriculture
Ministry of Coal
Ministry of Environment & Forests
Ministry of External Affairs
Stakeholders Ministry of Finance
Ministry of Heavy Industries & Public Enterprises
Ministry of Non-Conventional Energy Sources
Ministry of Petroleum & Natural Gas
Ministry of Power
Ministry of Road Transport & Highways
Ministry of Science & Technology
Councils
Confederation of Indian Industry
Council of Scientific and Industrial Research
Federation of Indian Chambers of Commerce and
Industry
Indian Council for Agricultural Research (ICAR)
Indian Council of Medical Research
National Council for Cement and Building Materials
Associations
Associated Chambers of Commerce and Industry
Principal
Cement Manufacturers’ Association
Laboratories
Forest Survey of India
stakeholders India Meteorological Departmen
India Meteorology Department
involved in
Indian Space Research Organisation
National Chemical Laboratory
National Physical Laboratory
developing
Regional Research Laboratory
Remote Sensing Applications Centre
NGOs and Centers
India’s First Centre for Environment Education
Centre for Inter-Disciplinary Studies of Mountain and
National
Hill Environment
Centre for Sustainable Technologies
Development Alternatives
Communication
Integrated Research and Action for Development
Integrated Research and Action for Development
Malaria Research Centre
Nehru Foundation for Development
Institutes
Central Fuel Research Institute
Central Glass and Ceramic Research Institute
Central Leather Research Institute
Central Mining Research Institute
Central Rice Research Institute
Central Road Research Institute
Forest Research Institute
G.B. Pant Institute of Himalayan Environment &
Development
Indian Agricultural Research Institute
Indian Institute of Forest Management, Bhopal
Indian Institute of Management
Indian Institute of Petroleum
Indian Institute of Science
Indian Institute of Technology
Indian Institute of Tropical Meteorology
Indira Gandhi Institute of Development Research
Institute for Social and Economic Change
Institute of Radio-physics and Electronics
Kerala Forest Research Institute
Maulana Azad National Institute of Technology
National Dairy Research Institute
National Environmental Engineering Research Institute
National Institute of Advanced Studies
National Institute of Oceanography
The Energy and Resources Institute
Wildlife Institute of India
Universities
Aligarh Muslim University
Jadavpur University
Jawaharlal Nehru University
School of Environmental Management
Tamil Nadu Agricultural University
Tripura University
University of Agricultural Sciences
University of Delhi
Several Tools are needed to answer the
questions………and prepare a LCD plan
Abatement Opportunities Multi-region
Technologies / Investment CGE
Marginal Abatement Cost
Dynamic
Etc
Stochastic
GE
EFFECT
TAMT Impact on Employment
MACtool Impact on Taxes
Impact on Trade
LULUCF Etc
Bottom-up vs. Top-down
In this presentation we will cover
EFFECT
Energy Forecasting Framework & Emissions Consensus
Tool
MACtool
Marginal Abatement Cost Tool
TAMT
Transport Activity Measurement Toolkit
LULUCF
Land Use, Land Use Change and Forestry Modeling
Linking Bottom-up with Top-down
Linking Macroeconomic and Bottom-Up Models
 How to EFFECT
Low Carbon Development
What is EFFECT?

Energy Forecasting Framework & Emissions Consensus Tool

• Excel-based, bottom-up, engineering style model

• Supports consensus building and planning in key
sectors of the economy
• Helps assess the impact of policy choices on GHG
emission levels
• Used in Brazil, India, Poland, and six Asian-Pacific
countries
Current modules

Transport Power Industry

Households Non-residential
EFFECT covers sectors of greatest growth
in GHG emissions
How does EFFECT Support Low Carbon
Development?
Consensus Building:
• Economy-wide development and climate change
goals
• Data and assumptions
• Best choice for a LCD pathway or plan for the future

Inclusive Structure:
• Targets decision-makers, planners and modelers
• Supports engagement on model inputs and analysis
How does EFFECT Support Low Carbon
Development?
Multi-sector focus:
• Power Generation
• On-Road Transport
• Household Electricity Use
• Nonresidential Energy Use
• Large-Scale Energy Intensive Industry

Scenario Planning:
• Develop emissions forecasts over a 25-year+ period
• Prioritize GHG emission reduction
• Design development and investment plans
• Identify conditions necessary for a supportive, enabling
environment for implementation
Low Carbon Development cannot be achieved
without a proper enabling environment…
Rationalize energy, water and agricultural price, tax
Incentives incentives, fiscal and expenditure policies

Efficiency standards; codes, zoning; climate screening/

Public Outreach
Regulations proofing of investments

Capacity of public, private and financial sector institutions

Institutions
to assess and act on climate risks

Improve investment climate; deepen financial and capital

Markets markets; new markets (cap & trade, CDM)

Education, raising awareness and promoting change in

Public Outreach
consumer behavior and preferences

16
EFFECT Ecosystem
The EFFECT Model
• Freely downloadable from WB website

e-Learning Courses
• How to EFFECT Low Carbon Development:
• For Policymakers
• The Power Module
• The Transport Module
• The Household Module

Supporting Materials
• 15 Minute Overview
• Help Function built-into Excel
• LCD Simulation Game
• Additional material from LCD studies
eLearning Courses

http://vle.worldbank.org/moodle/course/view.php?id=500
EFFECT Model Tutorial
MACtool
A tool to support the economic
analysis of low-carbon options
Objective

Simultaneous comparison of Mitigation

and Sequestration Options

To support efficient decision making

processes

Prototypical version developed for the Brazil Low-carbon

study
Four main sectors, more than 40 technologies from both
the Brazil and the Mexico Low-carbon studies
 Economic Analysis in the Low-carbon Study:
Inform the Decision Making Process
Key questions
Is there a low carbon option ?
What is the mitigation potential ?
Does it make sense economically from a
planning perspective ?
Would it happen spontaneously ?
Break-Even Carbon Price = +$8/tCO2
How much financing needed ?
Example:
Cogeneration from Sugarcane
YES: Extracting condensing turbine,
90 bars
158 MtCO2e (7.5MtCO2/year)
YES:
Marginal Abat. Cost = - $ 105 /tCO2
(8% social discount rate)
NO:
Sector Expected IRR is 18% > 8%
Incentive required = + $ 8 /tCO2
Additional investment = + $ 35 billion
(+$1.6 bi /year)
 Mitigation benefits ← →Mitigation costs
[US$/ton CO2e]

150
100
100

50
50

0
Bus rapid transit
Bus system optimization

Non-motorized transport

Freight logistics
Urban densification
Border vehicle inspection

Railway freight
Street lighting

1,000
Non-residential lighting
Gas flaring
Residential lighting
Utility efficiency
Industrial motors
Non-residential AC
Residential refrigeration
Fuel economy standards
Charcoal for steelmaking
Solar water heating
Zero tillage maize

2,000
Charcoal kilns
I&M in 21 cities
Improved cookstoves
Gas Leakage Reduction
Cogeneration in industry
Cogeneration in PEMEX
Residential AC
Biogas
Windpower

3,000 REDD

Cumulative mitigation 2009 -2030 [Mton CO2e]

Palm oil biodiesel
Afforestation
Bagasse cogeneration
Fuelwood co-firing (20%)
(UDS/t CO2e accumulative 2009 – 2030)

Reforestation & restoration

Geothermal
4,000

Sugarcane ethanol
Small hydro
Marginal abatement costs/benefits for Mexico

Biomass electricity
Sorghum ethanol
Refinery efficiency
 New investment costs [US$/ton CO2e]

0
10
20
30
40
50
60

0
Bus rapid transit
Bus system optimization

Non-motorized transport

Freight logistics
Urban densification
Border vehicle inspection

Railway freight
Street lighting

1,000
Non-residential lighting
Gas flaring
Residential lighting
Utility efficiency
Industrial motors
Non-residential AC
Residential refrigeration
Fuel economy standards
Charcoal for steelmaking
Solar water heating
Zero tillage maize

2,000
Charcoal kilns
I&M in 21 cities
Improved cookstoves
Gas Leakage Reduction
Cogeneration in industry
Cogeneration in PEMEX
Residential AC
Biogas
Windpower
Investment Required in Mexico

REDD
3,000

Cumulative mitigation 2009-2030 [Mton CO2e]

Palm oil biodiesel
Afforestation
Bagasse cogeneration
Fuelwood co-firing (20%)

Reforestation & restoration

for each MAC Intervention (2009 – 2030)

Geothermal
4,000

Sugarcane ethanol
Small hydro

Biomass electricity
Sorghum ethanol
Refinery efficiency
Source of investment: Public vs. Private in Mexico
for each MAC Intervention (2009 – 2030)

Net benefits
Net costs
Designed for

Systematic, rigorous and consistent information aggregation to

allow the comparison for:
• Different sectors and mitigation/sequestration options
(Energy, LULUCF, Transport, Waste Management)
• Different perspectives: Public and Private
• Different Countries, Regions, or Cities

Generate also sector specific information that speaks to usual

sector authorities, sector public agencies, MDB sector staff
examples:
 Installed power generation capacity for both the reference and the low-carbon
scenarios
 Volume of load transported by mode in for both the reference and the low-carbon
scenarios
The User’s Perspective

• Road-tested on real cases (Brazil, etc.)

• Free of charge

• Easy to use (step-by-step, user-friendly interface)

• Customized ready to use outputs/graphs

• Integrated Help File

• Supported by a training program

Progress

• Prototypical version already used in the Brazil Low-

carbon Study

• User interface development by June 2011

• Auditing: module by module by May 2011

• MACtool operational mid 2011

• Training programme over 2011 - 2012

 TAMT
Transport Activity Measurement Toolkit

19/04/2011
It’s all about how to get from
this…………
To this…..
GHG and local pollutant inventories at:
• National
• City
• Project levels

and scenario based

emissions forecasting
for distinct interventions
 Using GHG and local emissions models
• There are many good models that require
local data on vehicle activity
• TAMT will help local practitioners collect this
in a simple standardized manner

Image thanks to Colin K. Hughes, Institute of Transport & Development Policy

Transport Activity Measurement
Toolkit (TAMT) consists of:
Practitioners Guide
– That answers questions in a practical way:
– What to measure
– When to measure
– How to measure
– How many to measure
– Forms
– Quality Assurance and Quality control guides

Software tools to simplify data entry and processing

– For GPS collection and analysis
– For traffic counts and analysis
The Complexity Cube……
but all require activity measurements
Using GPS to measure travel time and
speed distribution in 5 km/h bins
• Low cost GPS loggers (US$50 -80)
• On different road types
• For different days/times
• Different vehicle categories
Vehicles per hour
3000

2500

2000

1500

1000

500

0
0 1 2 3 4 5 6 7
Minutes per km
TAMT software overview
• Platform independent
– Oracle VirtualBox client
• TAMT Appliance
– Operating system: Ubuntu 10.04
– Database: PostgreSQL with PostGIS extensions and PL/Java for stored
procedures; pgAdmin3 as database administration user interface
– Web Container: Apache Tomcat 6.0 - HTTP server and Servlet
container supporting Java Servlet 2.5 and JavaServer? Pages (JSP) 2.1.
– Software development kits: Java 1.5
– Integrated development environments: Eclipse 3.5.1 with Google
Plugin for Eclipse
– Internet browsers: Google Chrome, Mozilla Firefox
• Project documentation and downloads
– On code.google.com
http://code.google.com/p/tamt/wiki/DesignDocIntroduction
 Steps to get an activity-based GHG and
local pollutant emissions inventory
1 Divide routes into sections
with consistent traffic patterns
2 Measure traffic flow on each section
T by Day, Hour and Vehicle Class
A
3 Measure traffic speed and drive cycles
M
congested / uncongested flow
T
4 Measure Vehicle occupancy
to get passenger-km and freight-tonne-km
5 Use fleet composition data
Vehicle sales and registration data
Emissions test databases / Surveys

6 Use emissions (and traffic) models

to calculate GHG and local pollutant
emissions inventories and forecasts
With TAMT
• Use low cost GPS loggers in normal vehicle
operation
• Collect second-by-second data

• TAMT will automatically:

– Assign to road tags by vehicle type and time
of day
– Perform vehicle flow-weighted calculations
– Output in format required by model
Using YouTube for Help and Demos

http://www.youtube.com/watch?v=7dVWIKafmSE
Land Use,
Land Use Change
and Forestry Modeling

Prototypical version
developed and road-tested
under the Brazil Low Carbon
Country Case Study
LULUCF MODELLING

Three main steps:

1) Calculation of the Available Area for agricultural

expansion

2) Simulation model of spatial Land Use Change

(2010 - 2030)

3) Model for GHG Emissions as a function of

Land Use Change
1. CALCULATION OF AVAILABLE LAND
FOR AGRICULTURE EXPANSION
Urban Areas municipality
(IBGE census sector)

APPs
(50 m main rivers)
Areas available
for agriculture
Water
(land under water)

Areas available
Protected Areas by municipality
(several basis)

Declivity > 15%

(SRTM)
Current pastures
and crops
(IBGE)
soils =
Agriculture impediment
(Radam)
Area available for
Seasonal forests agriculture
(Prodes, Probio, SOS MA) expansion by
1 hectare of resolution municipality
100x100m
2. SPATIALLY EXPLICIT SIMULATION
MODEL FOR LAND USE CHANGE
(2010 - 2030)
 Partial Equilibrium Model to project Land Needed
(BLUM model, developed with ICONE)

Domestic
consumption

Costs

Net exports
Demand

Final stocks
(t-1) Expected
Price Area
return

Production

Supply Yields
Initial stocks

Source: ICONE. 45
 Land Use Modeling:
Rice
Interactions Among Sub Sectors

Corn

Ethanol

Sugarcane

Sugar
Industry and
Cotton biodiesel
Soybean oil

Drybean
Pork

Soybean meal
Soybean Poultry (eggs and
chicken)

Pasture Beef

Source: ICONE
46
SIM Brasil Land Use and Land Use
(CSR UFMG) Change Modeling results
Linking Macroeconomic and
Bottom-Up Models
A suite of models to assess carbon
abatement
Model suite for low carbon growth assessment
for Poland
•Multi-region CGE
•Peer-reviewed model
applied to Poland
•Impact of EU 20-20-20
package
ROCA Model
MacroMAC
curve

•TREMOVE model
MEMO
(road transport)
Model •Passenger, freight
•Dynamic stochastic
GE
•Poland model +
energy and climate
redesign MicroMAC
•Macro impact of TREMOVE
options
Curve Plus Model

•Marginal abatement cost

(NPV cost per tCO2e)
•~125 technology options
 Microeconomic marginal abatement cost (MicroMAC)
curve for Poland, 2030
Chemicals CCS, retrofit
Emission abatement cost Average cost: Off-shore wind
EUR/tCO2e ~10 EUR/tCO2e
Iron & Steel CCS, new built
Biomass co-firing
80 Retrofit building envelope, commercial
70 Biomass dedicated

60 Diesel LDV effectiveness Coal CCS

50 Gasoline LDV effectiveness On-shore wind

40 Biogas
30 Nuclear
20
New built efficiency package,
10 residential
0
-10 0 10 20 30 40 50 60 70 80 90 100 110 120 130 140 150 160 170 180 190 200 210 220 230
-20
-30
Organic soils Iron & Steel CCS, retrofit
-40 restoration
CCS in downstream
-50 Advanced retrofit building envelope –
residential
-60
Cogeneration
-70
-90 Abatement potential
Landfill – gas electricity
-100 generation MtCO2e in 2030
-110
-120 Recycling new waste
-130
-140 Basic retrofit building
-150 envelope, residential

Note: Each column is one of the 123 abatement measures. The height of the columns is the cost in € per abated tCO2e. The width is the
amount emissions can be reduced against business-as-usual levels projected for 2030. Some measures are shown with net benefits
(negative costs).
The switch to low-carbon energy and fuel efficiency
measures provide the bulk of GHG abatement.

Decomposition of abatement by micro-package,

MtCO2e
600 agriculture

550 industry CCS

500 chemical process

million tons of CO2e

optimization
450 energy efficiency
400
fuel efficiency
350
mixed energy/fuel
300 efficiency
energy sector
250 investments
BAU
200
1990 1995 2000 2005 2010 2015 2020 2025 2030 Low Carbon Path

Note: Model closure is increase in VAT.

Micro-packages with the largest abatement potential
do not necessarily impose the biggest macroeconomic
cost.
Decomposition of GDP impact of low carbon package, in %
1.5 chemical process
optimization
1.0 mixed energy/fuel
efficiency
0.5 agriculture interventions
0.2
0.0
industry CCS and distrib.
maintainance
-0.5
energy efficiency
-0.8
-1.0
fuel efficiency
-1.5 -1.5
energy sector investments
-1.8
-2.0
GDP deviation from BAU
2015 2020 2025 2030

Note: Change in real GDP is measured against business-as-usual scenario.

Categories are micro-packages (mitigation options grouped by economic
characteristics).
 Macroeconomic marginal abatement cost
MacroMAC curve, 2030

Note: Each column is one of the 119 abatement measures. The height of the columns is the marginal abatement impact in percent
of GDP (for each percent of GHG abatement) compared to business-as-usual in 2030. The width is the percent emissions can be
reduced. The area of any rectangle equals the GDP effect (loss or gain) of carbon abatement via any specific lever.
Model suite for low carbon growth assessment

MULTI-
REGION
CGE

Macro
MAC
curve LULUCF
MACtool
DYNAMIC
STOCHASTIC
CGE
EFFECT
TAMT
Take-away messages on modeling

• Consensus building needs data and assumptions to be

openly and transparently shared
• Data gathering takes time but is foundation for future
results monitoring
• You need a suite of different models to answer different
questions
• Build on existing proven approaches and models
• Build capacity to maintain and update scenarios and
models
Thank You

John Rogers
jarogers@worldbank.org
jarogers.wb@gmail.com