Download this Paper Open PDF in Browser

The Role of R&D and Technology Diffusion in Climate Change Mitigation: New Perspectives Using the Witch Model

42 Pages Posted: 4 May 2009 Last revised: 28 Aug 2012

Valentina Bosetti

Fondazione Eni Enrico Mattei (FEEM); Bocconi University; CMCC - Euro Mediterranean Centre for Climate Change

Carlo Carraro

Fondazione Eni Enrico Mattei (FEEM); Ca' Foscari University of Venice; CMCC - Euro Mediterranean Centre for Climate Change (Climate Policy Division); IPCC; Centre for Economic Policy Research (CEPR); CESifo (Center for Economic Studies and Ifo Institute); Centre for European Policy Studies, Brussels; Green Growth Knowledge Platform; International Center for Climate Governance

Romain Duval

Organization for Economic Co-Operation and Development (OECD)

Alessandra Sgobbi

Fondazione Eni Enrico Mattei (FEEM) ; Centro Euro-Mediterraneo per i Cambiamenti Climatici (CMCC)

Massimo Tavoni

Fondazione Eni Enrico Mattei (FEEM); Princeton University - Princeton Environmental Institute

Date Written: April 30, 2009

Abstract

This paper uses the WITCH model, a computable general equilibrium model with endogenous technological change, to explore the impact of various climate policies on energy technology choices and the costs of stabilising greenhouse gas concentrations. Current and future expected carbon prices appear to have powerful effects on R&D spending and clean technology diffusion. Their impact on stabilisation costs depends on the nature of R&D: R&D targeted at incremental energy efficiency improvements has only limited effects, but R&D focused on the emergence of major new low-carbon technologies could lower costs drastically if successful - especially in the non-electricity sector, where such low-carbon options are scarce today. With emissions coming from multiple sources, keeping a wide range of options available matters for stabilisation costs more than improving specific technologies. Due to international knowledge spillovers, stabilisation costs could be further reduced through a complementary, global R&D policy. However, a strong price signal is always required.

Keywords: Climate policy, Energy R&D, Fund, Stabilisation costs

JEL Classification: H0, H2, H3, H4, O3, Q32, Q43, Q54

Suggested Citation

Bosetti, Valentina and Carraro, Carlo and Duval, Romain and Sgobbi, Alessandra and Tavoni, Massimo, The Role of R&D and Technology Diffusion in Climate Change Mitigation: New Perspectives Using the Witch Model (April 30, 2009). FEEM Working Paper No. 14.2009; CMCC Research Paper No. 63. Available at SSRN: https://ssrn.com/abstract=1397076 or http://dx.doi.org/10.2139/ssrn.1397076

Valentina Bosetti (Contact Author)

Fondazione Eni Enrico Mattei (FEEM) ( email )

C.so Magenta 63
Milano, 20123
Italy

Bocconi University ( email )

Via Gobbi 5
Milan, 20136
Italy

CMCC - Euro Mediterranean Centre for Climate Change

Viale Gallipoli, 49
Lecce, 73100
Italy

Carlo Carraro

Fondazione Eni Enrico Mattei (FEEM) ( email )

Isola di San Giorgio Maggiore 8
Venezia, 30124
Italy
+39 04 12700460 (Phone)
+39 04 12700412 (Fax)

Ca' Foscari University of Venice ( email )

Cannaregio 873
Venice, 30121
Italy
+39 04 1234 9166 (Phone)
+39 04 1234 9176 (Fax)

HOME PAGE: http://www.carlocarraro.org/

CMCC - Euro Mediterranean Centre for Climate Change (Climate Policy Division) ( email )

Via Augusto Imperatore 16
Lecce, 73100
Italy
+39 0832 288650 (Phone)
+39 0832 277603 (Fax)

IPCC ( email )

C/O World Meteorological Organization
7bis Avenue de la Paix
Geneva, CH-1211
Switzerland
+41-22-730-8208/54/84 (Phone)
+41-22-730-8025/13 (Fax)

Centre for Economic Policy Research (CEPR)

77 Bastwick Street
London, EC1V 3PZ
United Kingdom

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

Centre for European Policy Studies, Brussels

1 Place du Congres
B-1000 Brussels, 1000
Belgium
+32 2 229 3911 (Phone)
+32 2 219 4151 (Fax)

Green Growth Knowledge Platform ( email )

International Environment House
11-13 chemin des Anemones
Geneva, 1219
Switzerland

HOME PAGE: http://www.greengrowthknowledge.org/

International Center for Climate Governance ( email )

Island of San Giorgio Maggiore 8
Venice, I-30124
Italy

HOME PAGE: http://www.iccgov.org/

Romain Duval

Organization for Economic Co-Operation and Development (OECD) ( email )

2 rue Andre Pascal
Paris Cedex 16, 75775
France

Alessandra Sgobbi

Fondazione Eni Enrico Mattei (FEEM) ( email )

Corso Magenta 63
20123 Milan
Italy

Centro Euro-Mediterraneo per i Cambiamenti Climatici (CMCC) ( email )

Viale Gallipoli, 49
Lecce, 73100
Italy

Massimo Tavoni

Fondazione Eni Enrico Mattei (FEEM) ( email )

Corso Magenta 63
20123 Milan
Italy

Princeton University - Princeton Environmental Institute

22 Chambers Street
Princeton, NJ 08544
United States

Paper statistics

Downloads
278
Rank
91,261
Abstract Views
1,377