An Integrated Assessment of Climate Change, Air Pollution, and Energy Security Policy

20 Pages Posted: 2 Dec 2009

See all articles by J. C. Bollen

J. C. Bollen

PBI, Netherlands Environmental Asessment Agency

Sebastiaan Hers

Energy research Centre of the Netherlands

Bob van der Zwaan

Columbia University - Lenfest Center for Sustainable Energy, Earth Institute

Date Written: December 1, 2009

Abstract

This article presents an integrated assessment of climate change, air pollution, and energy security policy. Basis of our analysis is the MERGE model, designed to study the interaction between the global economy, energy use, and the impacts of climate change. For our purposes we expanded MERGE with expressions that quantify damages incurred to regional economies as a result of air pollution and lack of energy security. One of the main findings of our cost-benefit analysis is that energy security policy alone does not decrease the use of oil: global oil consumption is only delayed by several decades and oil reserves are still practically depleted before the end of the 21st century. If, on the other hand, energy security policy is integrated with optimal climate change and air pollution policy, the world’s oil reserves will not be depleted, at least not before our modeling horizon well into the 22nd century: total cumulative demand for oil then decreases by about 20%. More generally, we demonstrate that there are multiple other benefits of combining climate change, air pollution, and energy security policies and exploiting the possible synergies between them. These benefits can be large: for Europe the achievable CO2 emission abatement and oil consumption reduction levels are significantly deeper for integrated policy than when a strategy is adopted in which one of the three policies is omitted. Integrated optimal energy policy can reduce the number of premature deaths from air pollution by about 14,000 annually in Europe and over 3 million per year globally, by lowering the chronic exposure to ambient particulate matter. Only the optimal strategy combining the three types of energy policy can constrain the global average atmospheric temperature increase to a limit of 3ºC with respect to the pre-industrial level.

Keywords: Climate Change, Air Pollution, Energy Security, Cost-Benefit Analysis

JEL Classification: H21, D58, C61, O33, Q40

Suggested Citation

Bollen, J.C. and Hers, Sebastiaan and van der Zwaan, Bob, An Integrated Assessment of Climate Change, Air Pollution, and Energy Security Policy (December 1, 2009). FEEM Working Paper No. 105.2009. Available at SSRN: https://ssrn.com/abstract=1516245 or http://dx.doi.org/10.2139/ssrn.1516245

J.C. Bollen

PBI, Netherlands Environmental Asessment Agency ( email )

Netherlands
Not Available (Phone)
Not Available (Fax)

Sebastiaan Hers

Energy research Centre of the Netherlands ( email )

Westerduinweg 3
Petten, 1755 LE
Netherlands

Bob Van der Zwaan (Contact Author)

Columbia University - Lenfest Center for Sustainable Energy, Earth Institute ( email )

314 Low Library
535 West 116th Street, MC 4327
New York, NY 10027
United States

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