204897382
What are sources of carbon lock-in in energy-intensive industry? A case study into Dutch chemicals production
Abstract Keeping global mean temperature rise well below 2 °C requires deep emission reductions in all industrial sectors, but several barriers inhibit such transitions. A special type of barrier is carbon lock-in, defined as a process whereby various forms of increasing returns to adoption inhibit innovation and the competitiveness of low-carbon alternatives, resulting in further path dependency. Here, we explore potential carbon lock-in in the Dutch chemical industry via semi-structured interviews with eleven key actors. We find that carbon lock-in may be the result of (i) technological incompatibility between deep emission reduction options over time, (ii) system integration in chemical clusters, (iii) increasing sunk costs as firms continue to invest in incremental improvements in incumbent installations, (iv) governmental policy inconsistency between targets for energy efficiency and deep emission reductions, and (v) existing safety routines and standards. We also identify barriers that do not have the self-reinforcing character of lock-in, but do inhibit deep emission reductions. Examples include high operating costs of low-carbon options and low risk acceptance by capital providers and shareholders. Rooted in the Dutch policy setting, we discuss policy responses for avoiding carbon lock-in and overcoming barriers based on the interviews, such as transition plans for individual industries and infrastructure subsidies.
55631187
The transition of energy intensive processing industries towards deep decarbonization : characteristics and implications for future research
Energy-intensive processing industries (EPIs) produce iron and steel, aluminum, chemicals, cement, glass, and paper and pulp and are responsible for a large share of global greenhouse gas emissions. To meet 2050 emission targets, an accelerated transition towards deep decarbonization is required in these industries. Insights from sociotechnical and innovation systems perspectives are needed to better understand how to steer and facilitate this transition process. The transitions literature has so far, however, not featured EPIs. This paper positions EPIs within the transitions literature by characterizing their sociotechnical and innovation systems in terms of industry structure, innovation strategies, networks, markets and governmental interventions. We subsequently explore how these characteristics may influence the transition to deep decarbonization and identify gaps in the literature from which we formulate an agenda for further transitions research on EPIs and consider policy implications. Furthering this research field would not only enrich discussions on policy for achieving deep decarbonization, but would also develop transitions theory since the distinctive EPI characteristics are likely to yield new patterns in transition dynamics.
44681088
INCREASING RETURNS AND LOCK-IN BY HISTORICAL EVENTS
This paper examines the dynamics of allocation under increasing returns within a model where agents choose between technologies competing for adoption and where each technology improves as it gains in adoption. It shows that the economy, over time, can become locked-in, by "random" historical events, to a technological path that is not necessarily efficient, not possible to predict from usual knowledge of supply and demand functions, and not easy to change by standard tax or subsidy policies. Rational expectations about future agents' technology choices can exacerbate this lock-in tendency. It discusses the implications for economic history, policy, and forecasting. Copyright 1989 by Royal Economic Society.
114426649
Lock-in of mature innovation systems, The transformation toward clean concrete in the Netherlands
Energy-intensive processing industries like the concrete industry form the base of the economy and account for a large part of greenhouse gas emissions. Sectoral transformation to cleaner basic materials is therefore crucial, and institutional pressure to do so is increasing. These sectors have nevertheless been largely omitted by socio-technical studies. This paper therefore sets out to analyze the systemic problems that inhibit the transformation of the mature innovation system of the concrete sector toward the development, diffusion and adoption of clean concrete innovations, for the case of the Netherlands. A coupled structural-functional approach has been frequently applied to identify such systemic problems, but has been limited to emerging technological innovation systems. Consequently, the approach tends to overlook the systemic lock-in that arises from interdependent systemic problems and vested interests that characterize mature innovation systems. This paper analyzes these characteristics to extend the application of the structural-functional approach to the transformation of mature innovation systems. Interviews with 28 stakeholders were conducted and triangulated with reports, websites and other documents. A list of systemic problems was identified that originate within actors, institutions, networks, technology and infrastructure and that impaired the performance of all system functions except knowledge development. Systemic problems are indeed found to be strongly interdependent, leading to systemic lock-in. Through strategic, often collective action, established firms with vested interests were able to reinforce these systemic problems to inhibit clean concrete innovation. The study concludes that systemic lock-in inhibits the sustainability transformation of the mature innovation system of concrete in the Netherlands and confirms that the application of the structural-functional approach can be extended from emerging to mature innovation systems.
54918772
On a wing and hot air: Eco-modernisation, epistemic lock-in, and the barriers to greening aviation and ruminant farming
Abstract The aviation and livestock agriculture sectors are major producers of greenhouse gas emissions, and have been the subject of extensive examination to develop lower impact, more energy and resource efficient technologies. Yet little attention has been paid to the challenges faced in the adoption of these lower impact technologies in these industry sectors. In this paper we seek to understand the interactions between technological innovation and socio-behavioural contexts in the adoption of more environmentally sustainable practices. Focusing on the UK (although recognising the global context of aviation and agriculture) and using a combination of literature analysis and interview data we undertake a detailed examination of these interactions. We examine why the claims of eco-modernisation theory that argue that the drive for economic efficiency will lead also to improved energy and resource efficiency appear unfounded in our cases. We identify lock-in in both sectors, finding that the barriers to greener innovation hinge particularly on the knowledge practices that pertain in the two sectors. This ‘epistemic lock-in’, rather than simple inertia and resistance to unfamiliarity, appears crucial, and must be overcome to enable adoption of lower impact technologies.
153794917
Lock-in and path dependence: an evolutionary approach to eco-innovations
The article presents an overview of the evolutionary approach to eco-innovations with particular emphasis on the role of lock-in and path dependence. In doing so, it focuses on the processes of radical change and the transition of technological systems that require the co-evolution of technology, firms, institutions and the society as a whole. Starting from clarifying the different notions of eco-innovations used in the literature, the article discusses the issues of lock-in and path dependence, by investigating the technological, organizational, institutional and social processes that strengthen as well as weaken path dependence. To this aim, it draws upon the evolutionary literature and discusses the relevance of path dependence and lock-in processes to understand the development of eco-innovations.
152992948
Institutional inertia and climate change: a review of the new institutionalist literature
Climate scientists and policy analysts alike have repeatedly called for urgent mitigating action to avoid the most adverse effects of climate change. However, within the political arena this action is largely lacking. To understand this discrepancy, we consider the institutions in climate change policy to be of central importance. Renewed interest in institutions has been generated to a great extent by ‘new institutionalism’, a field of research combining economics, political science, and sociology, and which has become increasingly popular since the 1980s. The tendency of institutions to resist change and thereby stabilize policy can be understood by using the concept of institutional inertia. Our review of the new institutionalist literature on climate change identifies five main mechanisms that generate institutional inertia: costs, uncertainty, path dependence, power, and legitimacy. Means of addressing these mechanisms are proposed by referring to the literature on institutional entrepreneurship and institutional work. A focus on the mechanisms that generate and regenerate institutional inertia is beneficial for future research on institutions and climate change, as it can be used to study bottlenecks for action and address more clearly the urgency of necessary policy interventions. WIREs Clim Change 2014, 5:639–648. doi: 10.1002/wcc.292



For further resources related to this article, please visit the WIREs website.



Conflict of interest: The authors have declared no conflicts of interest for this article.
159010800
Stability and climate policy? Harnessing insights on path dependence, policy feedback, and transition pathways
Abstract Instilling climate policy with stability has emerged as a central concern in both the academic literature and societal discourse around climate change. Societal actors have called for stable climate policy to enable low-carbon investment; decisionmakers have sought to provide credible signals; and scholars have developed insights to inform “stickier” instrument design. However, given the sources of instability confronting climate policy and the transformative changes entailed by decarbonization, this paper argues that climate policy stability may not only be unattainable but also undesirable. Instead of striving for stability as an overriding feature of climate policy, we suggest attending to a broader aim: stabilizing the overarching orientation of climate policy as a transition towards a low greenhouse gas emission economy. We review the complementary concepts of path dependence, policy feedback, and transition pathways to distill strategies that may help in addressing this aim.
53968815
The role of lock-in mechanisms in transition processes: The case of energy for road transport
a b s t r a c t This paper revisits the theoretical concepts of lock-in mechanisms to analyse transition processes in energy production and road transportation in the Nordic countries, focussing on three technology platforms: advanced biofuels, e-mobility and hydrogen and fuel cell electrical vehicles. The paper is based on a comparative analysis of case studies. The main lock-in mechanisms analysed are learning effects, economies of scale, economies of scope, network externalities, informational increasing returns, technologi- cal interrelatedness, collective action, institutional learning effects and the differentiation of power. We show that very different path dependencies have been reinforced by the lock-in mechanisms. Hence, the characteristics of existing regimes set the preconditions for the development of new transition pathways. The incumbent socio-technical regime is not just fossil-based, but may also include mature niches specialised in the exploitation of renew- able sources. This implies a need to distinguish between lock-in mechanisms favouring the old fossil-based regime, well-established (mature) renewable energy niches, or new pathways.
13703331
Carbon lock-in through capital stock inertia associated with weak near-term climate policies
Stringent long-term climate targets necessitate a limit on cumulative emissions in this century for which sufficient policy signals are lacking. Using nine energy-economy models, we explore how policies pursued during the next two decades impact long-term transformation pathways towards stringent long-term climate targets. Less stringent near-term policies (i.e., those with larger emissions) consume more of the long-term cumulative emissions budget in the 2010–2030 period, which increases the likelihood of overshooting the budget and the urgency of reducing GHG emissions after 2030. Furthermore, the larger near-term GHG emissions associated with less stringent policies are generated primarily by additional coal-based electricity generation. Therefore, to be successful in meeting the long-term target despite near-term emissions reductions that are weaker than those implied by cost-optimal mitigation pathways, models must prematurely retire significant coal capacity while rapidly ramping up low-carbon technologies between 2030 and 2050 and remove large quantities of CO2 from the atmosphere in the latter half of the century. While increased energy efficiency lowers mitigation costs considerably, even with weak near-term policies, it does not substantially reduce the short-term reliance on coal electricity. However, increased energy efficiency does allow the energy system more flexibility in mitigating emissions and, thus, facilitates the post-2030 transition.
153816520
Not irrational but habitual: The importance of "behavioural lock-in" in energy consumption
A substantial body of literature has shown that our behaviour is often guided by habits. The existence of habits -- not fully conscious forms of behaviour -- is important as it contradicts rational choice theory. Their presence thus calls for the setting of new instruments as they make it unlikely that consumers be capable of exercising control over their energy consumption in reaction to given incentives. This is further increased in the evolutionary perspective where the current carbon-based Socio-Technical System constrains and shapes consumers' choices through structural forces. Habits being potentially "counterintentional," they may explain the "efficiency paradox" in energy as well as the continued increase of energy consumption despite the rising environmental awareness among the population. Policies aiming at reducing energy consumption should thus specifically address the performance context of habits. For instance, targeting new residents has proven to be more effective given that their preceding habits have been disturbed. The results of our empirical analysis confirm this idea by showing how a change of context makes people more receptive to a proposed measure. Our analysis of the role played by habits also suggests that individuals do not consider the need to change existing habits as an obstacle even though this is contradicted implicitly in the answers they provided to open questions. This "unconsciousness" is one of the most delicate features of habits and it should thus be accounted for when designing measures. Given the other characteristics of habits, the joint use of feedbacks and commitment strategies appears promising.
14701754
Increasing Returns and Path Dependence in the Economy
When the University of Michigan Press approached me to bring out a book of collected papers on increasing returns in economics I was surprised. I had thought that only older researchers, venerable and near retirement, issued collected works. But Timur Kuran, my editor, and Colin Day, the Press’s director, argued that although the papers collected here have been receiving much attention lately, several of them have appeared in obscure places and are not easy to track down. In book form they would be accessible. Moreover, if they were brought together, a wider picture might emerge from the mosaic they create than from the individual pieces. This sounded like sufficient rationalization to me, and I accepted their invitation with gusto.
153605822
Understanding carbon lock-in
Abstract This paper narrative argues that industrial economies have been locked into fossil fuel-based energy systems through a process of technological and institutional co-evolution driven by path-dependent increasing returns to scale. It is asserted that this condition, termed carbon lock-in, creates persistent market and policy failures that can inhibit the diffusion of carbon-saving technologies despite their apparent environmental and economic advantages. The notion of a Techno-Institutional Complex is introduced to capture the idea that lock-in occurs through combined interactions among technological systems and governing institutions. While carbon lock-in provides a conceptual basis for understanding macro-level barriers to the diffusion of carbon-saving technologies, it also generates questions for standard economic modeling approaches that abstract away technological and institutional evolution in their elaboration. The question of escaping carbon lock-in is left for a future paper.
3714870
Carbon Lock-In: Types, Causes, and Policy Implications
Existing technologies, institutions, and behavioral norms together act to constrain the rate and magnitude of carbon emissions reductions in the coming decades. The inertia of carbon emissions due to such mutually reinforcing physical, economic, and social constraints is referred to as carbon lock-in. Carbon lock-in is a special case of path dependency, which is common in the evolution of complex systems. However, carbon lock-in is particularly prone to entrenchment given the large capital costs, long infrastructure lifetimes, and interrelationships between the socioeconomic and technical systems involved. Further, the urgency of efforts to avoid dangerous climate change exacerbates the liability of even small lock-in risks. Although carbon lock-in has been recognized for years, efforts to characterize the types and causes of carbon lock-in, or to quantitatively assess and evaluate its policy implications, have been limited and scattered across a number of different disciplines. This systematic review of ...
154750664
Escaping carbon lock-in
This article explores the climate policy implications of the arguments made in “Understanding carbon lock-in” (Unruh, 2000), which posited that industrial countries have become locked-into fossil fuel-based energy systems through path dependent processes driven by increasing returns to scale. Carbon lock-in arises through technological, organizational, social and institutional co-evolution, “culminating” in what was termed as techno-institutional complex (TIC). In order to resolve the climate problem, an escape from the lock-in condition is required. However, due to the self-referential nature of TIC, escape conditions are unlikely to be generated internally and it is argued here that exogenous forces are probably required.
155074685
Globalizing carbon lock-in
This paper extends the arguments surrounding carbon lock-in elaborated in Unruh (Energy Policy 28 (2000) 817; 30 (2002) 317) to countries currently undergoing industrialization. It argues that, for numerous reasons, industrializing countries are unlikely to leapfrog carbon intensive energy development. On the contrary, carbon lock-in may be globalizing and could further constrain climate change mitigation options. It is then argued that many policy recommendations ignore carbon lock-in, possibly limiting their potential for successful implementation. The paper then discusses four policy approaches that appear to have advantages given lock-in conditions. It is recognized, however, that relative ease of implementation does not necessarily equate with superiority. Instead, it is merely a path dependent outcome of past development decisions. Pursuing policies on the basis of relative implementation ease may help address the issue of climate change, but could also result in sub-optimal outcomes along other dimensions of sustainable development.
154844287
FUTURE TECHNOLOGIES FOR ENERGY-EFFICIENT IRON AND STEEL MAKING
The iron and steel industry is the largest energy-consuming manufacturing industry in the world. In 1990, its global energy consumption was estimated to be 18–19 EJ, or 10–15% of the annual industrial energy consumption [WEC, 1995]. Figure 5.1 shows that the annual world steel production has increased from about 100 million tonnes in 1945 to about 770 million tonnes in 1990 [IISI, 1992; IISI, 1996a]. The global steel production is expected to grow further by about 1.7% a year, mainly because of an increase in steel consumption in developing countries [Tilton, 1990; WEC, 1995]. At present the apparent steel consumption per capita in these countries is only one seventh of that in OECD-countries, but this situation is likely to change [WEC, 1995]. Whereas the crude steel production in OECD countries has remained fairly stable at 320–370 million tonnes per year since 1980, the production in developing countries is growing steadily at a rate of more than 6% annually and reached about 240 million tonnes in 1993 [WEC, 1995]. This growth is expected to continue. As a result, the global steel production might rise to 1280 million tonnes in the year 2020, assuming a business-as-usual scenario. In this scenario the global energy consumption of the iron and steel industry is projected to increase to more than 25 EJ in the year 2020 [WEC, 1995].
56031436
Up in the air: Barriers to greener air traffic control and infrastructure lock-in in a complex socio-technical system
Abstract Greater automation of air traffic control (ATC) could reduce aviation's climate change impacts, but improvements predicted long ago have been slow to happen. This resistance to ATC modernisation is framed as an issue of lock-in, and the detailed case study described here enables an analysis of the factors involved in slowing change. Although the classic lock-in effects of ‘increasing returns’ and ‘network externalities’ are important, a major barrier to modernisation is due to the political and organisational challenges of coordinating change across a large, complex socio-technical system. However, lock-in effects are crucial with respect to the perceived increasing returns accrued from experience with manual ATC operations, and the difficulty of quantifying the risks of automation (particularly as regard the use of complex software) is a major barrier to further improvements. Overcoming this obstacle to further automation depends on finding ways to test and operate new ATC software and procedures without compromising safety.
154860619
Increasing Returns, Path Dependence, and the Study of Politics
It is increasingly common for social scientists to describe political processes as “path dependent.” The concept, however, is often employed without careful elaboration. This article conceptualizes path dependence as a social process grounded in a dynamic of “increasing returns.” Reviewing recent literature in economics and suggesting extensions to the world of politics, the article demonstrates that increasing returns processes are likely to be prevalent, and that good analytical foundations exist for exploring their causes and consequences. The investigation of increasing returns can provide a more rigorous framework for developing some of the key claims of recent scholarship in historical institutionalism: Specific patterns of timing and sequence matter; a wide range of social outcomes may be possible; large consequences may result from relatively small or contingent events; particular courses of action, once introduced, can be almost impossible to reverse; and consequently, political development is punctuated by critical moments or junctures that shape the basic contours of social life.
154313945
Systemic instruments for systemic innovation problems: A framework for policy makers and innovation scholars
Systemic policy instruments are receiving increased attention among innovation scholars as a means to stimulate sustainability oriented technological innovation. The instruments are called systemic in the expectation that they will improve the functioning of entire (innovation) systems. A first step in designing systemic instruments is an analysis of the systemic problems that hinder the development of a specific technological trajectory. This paper argues that two approaches to studying innovation systems—structural and functional analyses—can be combined in a systemic policy framework that helps to first, identify the systemic problems; and second, to suggest the systemic instruments that would address these problems.
153629093
Carbon capture and storage, bio-energy with carbon capture and storage, and the escape from the fossil-fuel lock-in
Abstract Carbon capture and storage (CCS) is increasingly depicted as an important element of the carbon dioxide mitigation portfolio. However, critics have warned that CCS might lead to “reinforced fossil fuel lock-in”, by perpetuating a fossil fuel based energy provision system. Due to large-scale investments in CCS infrastructure, the fossil fuel based ‘regime’ would be perpetuated to at least the end of this century. In this paper we investigate if and how CCS could help to avoid reinforcing fossil fuel lock-in. First we develop a set of criteria to estimate the degree of technological lock-in. We apply these criteria to assess the lock-in reinforcement effect of adding CCS to the fossil fuel socio-technical regime (FFR). In principle, carbon dioxide could be captured from any carbon dioxide point source. In the practice of present technological innovations, business strategies, and policy developments, CCS is most often coupled to coal power plants. However, there are many point sources of carbon dioxide that are not directly related to coal or even fossil fuels. For instance, many forms of bio-energy or biomass-based processes generate significant streams of carbon dioxide emissions. Capturing this carbon dioxide which was originally sequestered in biomass could lead to negative carbon dioxide emissions. We use the functional approach of technical innovations systems (TIS) to estimate in more detail the strengths of the “niches” CCS and Bio-Energy with CCS (BECCS). We also assess the orientation of the CCS niche towards the FFR and the risk of crowding out BECCS. Next we develop pathways for developing fossil energy carbon capture and storage, BECCS, and combinations of them, using transition pathways concepts. The outcome is that a large-scale BECCS development could be feasible under certain conditions, thus largely avoiding the risk of reinforced fossil fuel lock-in.
158340092
A review of technology and policy deep decarbonization pathway options for making energy-intensive industry production consistent with the Paris Agreement
Abstract The production of commodities by energy-intensive industry is responsible for 1/3 of annual global greenhouse gas (GHG) emissions. The climate goal of the Paris Agreement, to hold the increase in the global average temperature to well below 2 °C above pre-industrial levels while pursuing efforts to limit the temperature increase to 1.5 °C, requires global GHG emissions reach net-zero and probably negative by 2055–2080. Given the average economic lifetime of industrial facilities is 20 years or more, this indicates all new investment must be net-zero emitting by 2035–2060 or be compensated by negative emissions to guarantee GHG-neutrality. We argue, based on a sample portfolio of emerging and near-commercial technologies for each sector (largely based on zero carbon electricity & heat sources, biomass and carbon capture, and catalogued in an accompanying database), that reducing energy-intensive industrial GHG emissions to Paris Agreement compatible levels may not only be technically possible, but can be achieved with sufficient prioritization and policy effort. We then review policy options to drive innovation and investment in these technologies. From this we synthesize a preliminary integrated strategy for a managed transition with minimum stranded assets, unemployment, and social trauma that recognizes the competitive and globally traded nature of commodity production. The strategy includes: an initial policy commitment followed by a national and sectoral stakeholder driven pathway process to build commitment and identify opportunities based on local zero carbon resources; penetration of near-commercial technologies through increasing valuation of GHG material intensity through GHG pricing or tradable performance based regulations with protection for competitiveness and against carbon leakage; research and demand support for the output of pilot plants, including some combination of guaranteed above-market prices that decline with output and an increasing requirement for low carbon inputs in government procurement; and finally, key supporting institutions.
156225847
Managing the costs of CO2 abatement in the cement industry
This article investigates how the costs associated with deep reductions in CO2 emissions from the cement industry will influence the costs across the entire value chain from cement production to the eventual end-use, in this case a residential building. The work is motivated by the substantial difference between the pricing of CO2 emissions and the costs of mitigation at the production sites of energy-intensive industries, such as cement manufacture. By examining how CO2 trading and investments in low-carbon kiln systems affect costs and prices further up the supply chain of cement our analysis provides new perspectives on the costs of industry abatement of CO2 and on the question of who could or should pay the price of such abatement. The analysis reveals that the cost impacts decrease substantially at each transformation stage, from limestone to final end-uses. The increase in total production costs for the residential building used as the case study in this work is limited to 1%, even in the cases where the cement price is assumed to be almost doubled. Policy relevance With the price of emission allowances under the EU Emissions Trading System (EU ETS) currently far below the levels required to unlock investments in low-CO2 production processes in carbon-intensive industry (i.e. petroleum refining, iron and steel production and cement manufacturing), this article seeks to pave the way for a discussion on complementary policy options. The results from this study, using the supply of cement and concrete to a residential building as a case study, suggest that because cement and concrete typically account for a limited proportion of the total cost of most construction and civil engineering projects, a policy scheme designed to allocate more of the costs of CO2 abatement to the end-users (of cement) would neither (significantly) alter the cost structure nor (dramatically) increase overall project costs.
154389567
Time to stop investing in carbon capture and storage and reduce government subsidies of fossil-fuels
Government investment in carbon capture and storage (CCS) is a large and expensive fossil-fuel subsidy with a low probability of eventual societal benefit. Within the tight resource constrained environments that almost all governments are currently operating in, it is irresponsible to sustain this type of subsidy. CCS has been promoted as a ‘bridging’ technology to provide CO2 reductions until non-fossil-fuel energy is ramped up. But the past decade of substantial government investment and slow progress suggests that the challenges are many, and it will take longer to build the CCS bridge than to shift away from fossilfuels. Optimism about the potential of CCS is based primarily on research on technical feasibility, but very little attention has been paid to the societal costs of governments perpetuating fossil-fuels or to the sociopolitical requirements of long-term regulation of CO2 stored underground. Deep systemic change is needed to alter the disastrous global fossil-fuel trajectory. Government investment in CCS andotherfossil-fueltechnologiesmustendsothatthedistractionandcomplacency of the false sense of security such investments provide are removed. Instead of continuing to invest billions in CCS, governments should invest more aggressively in technologies, policies, and initiatives that will accelerate a smooth transition to non-fossil-fuel-based energy systems. We need to divest from perpetuating a fossil-fuel infrastructure, and invest instead in social and technical changes that will help us prepare to be more resilient in an increasingly unstable and unpredictable future. © 2013 The Authors. WIREs Climate Change published by John Wiley & Sons, Ltd. How to cite this article:
157099137
Locked-in post-socialism: rolling path dependencies in Liberec’s district heating system
Abstract This paper uses the experience of post-socialist district heating reforms to tell a broader story about the continued and shared challenges that central and eastern European cities face as they grapple with the legacies of the recent and more distant past. We argue that the restructuring of this infrastructural domain has been contingent upon geographically embedded trajectories stemming from previous historical periods, while leading to the creation of new socio-technical lock-ins. The paper thus develops the notion of “rolling path-dependencies” in order to explore how post-socialist developments both overcome and supplant previous trajectories of transformation. It focuses on the northern Czech town of Liberec – a place that is known for having some of the highest heating prices in the country – to elucidate how a socially, economically, and environmentally detrimental lock-in has come into existence as a result of ill-conceived policies of marketization, municipalization, and privatization. Using evidence from official documents and interviews with policy-makers, we demonstrate how the infrastructural legacies of post-socialism both persist and are being reproduced at the urban scale even within “advanced” reforming states like Czechia.
152467461
Assessing carbon lock-in
The term 'carbon lock-in' refers to the tendency for certain carbon-intensive technological systems to persist over time, 'locking out' lower-carbon alternatives, and owing to a combination of linked technical, economic, and institutional factors. These technologies may be costly to build, but relatively inexpensive to operate and, over time, they reinforce political, market, and social factors that make it difficult to move away from, or 'unlock' them. As a result, by investing in assets prone to lock-in, planners and investors restrict future flexibility and increase the costs of achieving agreed climate protection goals. Here, we develop a straight-forward approach to assess the speed, strength, and scale of carbon lock-in for major energy-consuming assets in the power, buildings, industry, and transport sectors. We pilot the approach at the global level, finding that carbon lock-in is greatest, globally, for coal power plants, gas power plants, and oil-based vehicles. The approach can be readily applied at the national or regional scale, and may be of particular relevance to policymakers interested in enhancing flexibility in their jurisdictions for deeper emissions cuts in the future, and therefore in limiting the future costs associated with 'stranded assets'.
49398214
Future Prospects for Energy Technologies: Insights from Expert Elicitations
Expert elicitation is a structured approach for obtaining judgments from experts about items of interest to decision makers. This method has been increasingly applied in the energy domain to collect information on the future cost, technical performance, and associated uncertainty of specific energy technologies. This article has two main objectives: (1) to introduce the basics of expert elicitations, including their design and implementation, highlighting their advantages and disadvantages and their potential to inform policymaking and energy system decisions; and (2) to discuss and compare the results of a subset of the most recent expert elicitations on energy technologies, with a focus on future cost trajectories and implied cost reduction rates. We argue that the data on future energy costs provided by expert elicitations allows for more transparent and robust analyses that incorporate technical uncertainty, which can then be used to support the design and assessment of energy and climate change mitigation policies.
197777708
The impact of implementing a consumption charge on carbon-intensive materials in Europe
ABSTRACT The production of basic materials accounts for around 25% of global greenhouse gas emissions. Existing measures to reduce emissions from industry are limited due to a combination of competitiveness concerns and a lack of technological options available to producers. In this paper, we assess the possibility of implementing a materials charge to reduce demand for basic industrial products and, hence, also reduce industrial emission levels. The modelling shows that a charge equivalent to around €80/tCO2 could reduce the EU’s total (energy plus process) CO2 emissions by up to 10% by 2050, depending on the substitution options available. The materials charge could lead to small GDP increases and a minor reduction in overall employment levels. Key policy insights Full carbon price pass through along the materials value chain creates incentives for resource efficiency and substitution in the value chain of material use. Most macroeconomic models ignore mitigation opportunities in the value chain, as do carbon pricing mechanisms for industrial emitters, which largely mute incentives for mitigation opportunities with free allowance allocation. Including consumption at a benchmark level in emission trading systems reinstates a full carbon price incentive for all mitigation opportunities while avoiding competitive distortions and carbon leakage risks. Macroeconomic modelling shows that this allows for an additional 10% emission reduction accompanied by a slight GDP increase and employment reduction. Long-term clarity on carbon leakage protection furthermore strengthens low-carbon investment frameworks.
158897959
Pricing carbon consumption: synthesizing an emerging trend
ABSTRACT Nearly every carbon price regulates the production of carbon emissions, typically at midstream points of compliance such as power plants, consistent with typical advice from the literature. Since the early 2010s however, policymakers in Australia, California, China, Japan and Korea have implemented carbon prices that regulate the consumption of carbon emissions, where points of compliance are further downstream, such as distributors or final consumers. This article identifies the pivot towards placing the point of compliance for carbon prices further downstream as an emerging international trend, describes the designs of different prices on carbon consumption around the world, and explains the various motivations of the policymakers implementing them. Findings reveal that policymakers tend to layer prices on carbon consumption on top of prices on carbon production in an effort to improve economic outcomes by addressing incomplete pass-through of the carbon price from producer to consumer, thereby facilitating more cost-effective abatement. Policymakers also use prices on carbon consumption to reduce emissions leakage or because large producers of carbon are not within their jurisdiction. The prevalence of prices on carbon consumption will likely increase as evidenced by proposals in China and Europe. Key policy insights The recent surge in the number of jurisdictions implementing prices on carbon consumption represents an emerging international trend. Policymakers use prices on carbon consumption in an effort to improve economic outcomes and capture environmental benefits. While this article offers insights that detail initial challenges and successes, whether these prices on carbon consumption actually achieve their intended goals is an academically rich topic that requires further research on individual policies.