PNAS Study Implicitly Confirms Climate Treaty Threatens Developing Country Economies

A study published this week in Proceedings of the National Academy of Sciences (PNAS) frets that the “carbonization” of energy resulting from the “renaissance of coal” in developing countries could render “ambitious” emission stabilization goals “infeasible.” Gee, really — who’da thunk it?

Although the main takeaway conclusion is obvious, the study provides lots of information about the factors (population, GDP per capita, energy intensity of GDP, carbon intensity of energy) driving global and regional emission trends.

As illustrated in the chart below, the big drivers of emissions growth, especially in recent years, are increases in GDP per capita, primary energy consumption, and the carbon intensity of energy. Population growth is not a significant factor. Decreasing energy intensity of production has worked to restrain emissions growth.

The authors recognize that coal consumption in developing countries is strongly correlated with high rates of economic growth. Moreover, they find that the upsurge in consumption since 2000 is due to coal’s competitive price in global markets rather than domestic resource availability.

In summary, in recent years non-OECD countries have relied increasingly on coal to meet their energy needs. The poorer a country is and the higher its rate of economic growth, the stronger is this effect. Both effects become more pronounced over time, suggesting that increasing coal use is a general trend among poor, fast-growing countries and is not restricted to a few specific countries. These results confirm the hypothesis of a global renaissance of coal. This conclusion is strengthened by the fact that excluding China and India from the regression hardly affects the results (see SI Appendix for details), indicating that these two countries are not driving the results but rather are representative for the global sample. . . .This renaissance of coal has even accelerated in the last decade; this acceleration can be explained by the low prices of coal relative to other energy sources.

PNAS undoubtedly published the study because the results spell danger for the COP 21 climate treaty conference in Paris. In the authors’ words:

Our results raise the more general question of the role of developing countries in climate-change mitigation. Developing economies now account for such a large share of global energy use that the trend toward higher carbon intensity in these countries cancels out the effect of decreasing carbon intensities in industrialized countries. If the future economic convergence of poor countries is fueled to a major extent by coal, i.e., if current trends continue, ambitious mitigation targets likely will become infeasible.

The same conclusion implies, of course, that ambitious stabilization goals could make developing country efforts to eradicate poverty infeasible. Isn’t that the more important concern and issue?

The authors grope for ways to reconcile developing countries’ existential interest in “cheaply available energy for economic growth” and the alleged climatological imperative to avoid “lock-in of carbon-intensive energy infrastructures” over the next few decades. For example, they propose that all new coal power plants be “capture-ready,” i.e. easily retrofitted with carbon capture and storage (CCS) technology. But CCS is still a long way from being commercially-viable even in industrialized nations. Moreover, when combined with enhanced oil recovery – the most economic (or least uneconomic) option – CCS may actually increase CO2 emissions on a life-cycle basis.

One way to stop the coal surge would be to block coal exports to developing countries — a key objective of the Sierra Club’s ‘Beyond Coal’ campaign. I have no idea where the authors stand on that strategy. However, they do regard proposals to buy out or forcibly close coal mines as politically counterproductive:

In consideration of decarbonization efforts, two recent publications . . . propose schemes to restrict the supply of coal. However, given their severe distributional impacts, these approaches are unlikely to be more politically acceptable than quantitative emission caps, than a carbon tax to curb emissions (combined with a transfer mechanism to compensate poor countries for their incremental abatement costs), or than incentivizing developing countries to participate in a global climate agreement.