The Deep Decarbonization Pathways Project (DDPP): insights and emerging issues

1. Why ‘deep decarbonization’? What are DDPs?

International climate policy discussions have fundamentally changed since the fifteenth Conference of the Parties (COP 15) in Copenhagen. Before, the debate was organized around short-term, incremental actions and common but differentiated responsibility (CBDR) was interpreted as putting the responsibility for action on developed countries. Since then, international negotiations have evolved under the increasing pressure from scientific evidence of the negative development impacts of climate change drivers and outcomes (e.g. coal combustion air pollution and sea level rise) and of the increasingly stringent mitigation requirements for climate stabilization. This resulted in international agreement to limit the mean surface temperature increase to 2°C compared with pre-industrial levels, as formalized in the Cancun COP 16 agreement, and recognition that formal participation by all major emitters would be required, as formalized in the Durban COP 17 agreement that each nation would offer voluntary national low-carbon development strategies. These are now called Intended Nationally Determined Contributions (INDCs). Combined, these elements lead to three principles. First, scientific analysis has provided evidence that the 2°C limit requires all economies to reach close to zero GHG emissions by the second half of this century. Second, full and meaningful participation by all countries means that all must define their own decarbonization plan, mindful of their country-specific social and economic circumstances. Third, the CBDR principle is now reinterpreted in terms of the international cooperation needed to enable national efforts. These three principles are now enshrined in the COP 21 Paris Agreement, wherein ambition has also been increased to ‘ … holding the increase in the global average temperature to well below 2°C above pre-industrial levels and pursuing efforts to limit the temperature increase to 1.5 °C’ (UNFCCC, 2015, Art.2.1(a), p. 22.¹).

This change in the climate policy debate has important consequences for the methods used to inform the process. Prior to COP 15, when only partial decarbonization was considered, research efforts were focused on marginal abatement cost curves as a way to inform economic efficiency in terms of the abatement of CO₂-equivalent (CO₂e) emissions. When full instead of partial decarbonization is considered, however, walking up the marginal abatement cost curve does not work. What is appropriate at the bottom (US$0–50 per tCO₂e, e.g. converting from coal to natural gas) is not appropriate at the top, and could lead to a lock-in of infrastructure and assets that are incompatible with long-term near-zero emissions and an unsatisfactory alignment with social and economic priorities. Backcasting to a downward attractor such as complete decarbonization, on the other hand, foresees these difficulties and suggests short-term policy options that are consistent with the long-term target.

A national deep decarbonization pathway (DDP) uses this backcasting approach to inform the low-carbon transformation envisaged by the Paris Agreement. A DDP is a national blueprint of the changes in physical infrastructure, the deployment of technologies (e.g. energy-efficient and low-carbon vehicles, buildings, power plants, industrial processes and boilers), sectoral investment and associated behavioural patterns (including rebound effects) that are required over time. Economic structural changes and general macroeconomic effects were considered by some, but not all, participating teams in the project. For each nation there are many possible DDPs, and their fundamental purpose is to inform and encourage stakeholders and decision makers to debate and choose amongst them, building the political consensus necessary for policy implementation. DDPs are built around three principles.

First, DDPs are defined at the country scale, with an economy-wide perspective and sectoral disaggregation that ensures that national technical, social and economic priorities and circumstances are explicitly taken into account.

Second, DDPs consider a long-term timeframe (2050 in the present study) and provide an explicit description of the trajectory from the present to the long-term objective in order to inform the sequencing of decisions at different time horizons, and especially the consistency of short-term policy and actions with long-term deep decarbonization. Third, DDPs provide detailed and explicit information on how deep decarbonization can occur. A detailed transformation is described for all energy-supply and end-use sectors according to three key components of decarbonization: energy efficiency, decarbonization of energy carriers (e.g. electricity) and switching to low-carbon energy forms like electricity in end uses. Process and fugitive emissions and land-use change were considered by some but not all country teams in the project. A key feature of the DDP approach is that it combines a rigorous accounting framework that is common across scenarios and country teams using many different and more or less sophisticated modelling frameworks. The common DDP ‘dashboard’ tracks carbon, energy, infrastructure stocks and investment costs at the sector and subsector levels, capturing the physical changes required to reduce emissions and providing a basis for aggregation and comparison across countries.

The development of pathways that satisfy these three methodological principles is the purpose of the DDPP. Formed in October 2013 under the auspices of the Institute for Sustainable Development and International Relations (IDDRI) and the Sustainable Solutions Development Network (SDSN), the DDPP is a collaborative global initiative whose initial purpose was to demonstrate how individual countries can establish 2°C-consistent pathways. As of early 2016, the DDPP was composed of leading researchers and institutions that represented sixteen industrialized and emerging economies, covering 74% of global energy-related GHG emissions: Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, South Africa, South Korea, the UK and the US. The teams explicitly did not represent the positions of their national governments, but were all engaged in their domestic policy debates. Each country team developed a set of national DDPs according to the above-defined principles in order to explore the physical, financial and policy requirements for achieving deep decarbonization while taking into account domestic social and economic conditions, development priorities, existing infrastructure, natural resource endowments and other relevant factors. The 2015 global synthesis and country reports can be found at http://www.deepdecarbonization.org.

The DDPP is different from other studies that consider deep reductions (defined as >80%, e.g. the Low Carbon Society studies, the Energy Modelling Forum 22) in that the DDPP was meant not only to analyse the possibility of deep mitigation, but to be a proof of concept for a different way of approaching deep decarbonization scenario building and the reason for doing so. The use of downward attractors (technological benchmarks and GHG per capita) and a common dashboard for a wide variety of modelling types and skill levels are two of the key methodological contributions of the DDPP, as is the focus on using them as communication and debate tools to build political consensus.

2. What DDPs contribute to good climate policy practice

DDPs can help to avoid ‘dead end’ investments that reduce emissions in the short term but are not compatible with deep decarbonization in the long term, and hence carry the risk of becoming stranded assets and possibly impeding future decarbonization. Although 2050 may seem far away, the operational lifetimes of much of the infrastructure and equipment that drive CO₂ emissions – power plants, buildings, industrial boilers and heavy duty vehicles – are long compared with the time remaining between now and the mid-century point.

DDPs are needed to coordinate policy and investment across jurisdictions, sectors and levels of government. By providing a transparent understanding of what a low-carbon transition entails – the scope and timing of infrastructure changes, technology options, investment requirements and research, development and demonstration needs, as well as market potential – DDPs can help to align public and private-sector interests and expectations. DDPs can provide a framework for the coordination of policy and investment between sectors, across jurisdictions and between jurisdictional levels (e.g. federal, provincial, local).

DDPs can identify opportunities for international cooperation, in areas ranging from technology research and development to market transformation and trade.

DDPs provide a framework for understanding how deep decarbonization can work in harmony with other sustainable development priorities. Having DDPs as a public point of reference can help countries to ensure that the energy transformation and other decarbonization measures (e.g. land-use changes) also support long-term goals such as energy access, employment opportunities, environmental protection and public health.

DDPs may increase trust in the international climate policy process. DDPs represent a transparent approach to understanding the long-term policy challenges, technology needs and cost structures of deep decarbonization in different countries. This can do much to change the tenor of the international climate discourse and place greater focus on opportunity-seeking and collective problem-solving. Much of the analysis informing past negotiations has been of a black box nature. DDPs, in contrast, are about putting all the cards on the table, making long-term national aspirations and the underlying assumptions that inform them clear to other countries.

DDPs are needed to remain within carbon budgets and to increase the ambition of country commitments to reducing their GHG emissions under the UNFCCC. By describing the full extent of the transformation required over a longer timeframe, DDPs provide a clear context for understanding the ambition of current INDCs and the further measures that deep decarbonization will entail. Although DDPs are best seen as roadmaps of options and enabling conditions, they can nonetheless play a critical role in increasing the ambition of future national commitments and provide long-term benchmarks for measuring short-term progress.

3. The purpose and content of this special issue

This special issue is meant to show how the DDPP evolved from and contributes to the energy and climate policy literatures, as an analytic, communications and stakeholder confidence-building process by which effective climate policy may be more successfully pursued. The article topics fall into three main categories: overarching methodology and policy design, the incorporation of domestic policy circumstances and the situation of national analyses in a global context.

3.1. Overarching method and policy design

DDPs and the DDPP are founded on three key principles: detailed and explicit information on how deep decarbonization can occur, short-term policy guidance set within long-term goals and, finally, an appropriate scale to match national circumstances and jurisdictional powers to implement policy. Bataille and colleagues (2016) show how these are established and work together, and what they contribute to climate policy.

DDP analyses are supported by modelling tools, but as part of a larger process. Models are used to organize the assumptions defined by national experts, provide detailed technology and sector coverage, clarify policy implementation points and account for complex interactions and possible unintended consequences. The DDP approach is model-agnostic; different modelling approaches can be useful according to the focal question posed in given country’s analysis. Pye and Bataille (2016) focus on the modelling developments necessary to allow more countries to construct DDPs. They review the models currently being used (i.e. accounting, bottom-up, hybrids of various forms, linked, top-down or integrated assessment models), their strengths and weaknesses and the improvements that are required. A key conclusion is the need for transparent entry-level modelling tools to allow more parties to prepare DDPs. For more advanced practitioners, sufficient bottom-up technological detail is necessary for deep decarbonization, and macroeconomic capability will be required to address welfare, gross domestic product and economic structure issues, leading to the eventual necessity for hybrid or linked approaches. A recommendation for the DDP process from the analysis is to match appropriate modelling tools to the challenges of a given set of national circumstances, instead of shoehorning the DDP analysis into possibly inappropriate tools. The article finishes with a proposed analysis framework to aid practitioners in clarifying policy issues, establishing scenarios and selecting tools.

Policy is the end goal of all DDP analyses, with an innovative approach to the question of decision-making in a context of strong uncertainties. A DDP analysis encourages the discussion of several trajectories leading to the ultimate objective in order to reveal, through comparisons and benchmarking, the crucial transformational points on which policy action should be focused to build a robust and resilient transition. Mathy, Criqui, Knoop, Fischedick, and Samadi (2016) focus on adaptive policy management procedures and institutions to make DDP policy more resilient to uncertainties. They find that dedicated mechanisms and institutional frameworks are necessary, ones that can monitor progress, tweak existing policies and signal to policy makers whether goals are being missed and larger changes are needed.

3.2. Incorporation of domestic policy circumstances

A key tenet of DDPs is the centrality of national circumstances in emissions-reduction planning and their effect on policy. Oshiro, Kainuma, and Masui (2016) analyse the dual priorities of decarbonization and energy security from the Japanese perspective. Japan has very few domestic resources, imports virtually all of its oil and natural gas and shut down its nuclear resource in 2011 – some of it perhaps permanently. The article finds that although decarbonization through renewables is possible in the long term (2050), on the 2030 timeframe Japan’s import dependency and energy security may worsen without nuclear and require other, stronger energy security policies (e.g. source and type diversification).

For South Africa, the overriding objective is poverty and inequality alleviation in a country with great difficulties in improving labour productivity. Altieri and colleagues (2016) used advanced macroeconomic modelling techniques to depict policy to reallocate low-skilled labour from the GHG-intensive coal sector to the low-skilled but less GHG-intensive agricultural sectors and thereby reduce emissions, improve welfare and reduce inequality.

3.3. National analyses in a global context

A national scope, and more specifically one that matches jurisdictional powers to implement the Paris Agreement, is central to DDPs. To ensure a multitude of national analyses add up to the global target, the DDPP made use of technological guidance (e.g. GHG intensity guidelines for electricity and vehicles) and downward attractor guidelines like 2050 GHG per capita allowances. These are not always enough to ensure overall integrity of the final composite result, however. In Pye and colleagues (2016) it was found by adding up supply and demand for key fossil fuel commodities across the DDPP that small imbalances and changes in regional demand could have large effects on producer economies in terms of trade (e.g. Chinese demand for Australian coal, and US demand for Canadian oil). Conversely, although global models typically do balance global supply and demand, they can miss key technological, economic and political details. By analysing the DDPs of several producer countries, several instances were found where the structure of a commonly used integrated assessment model missed key details of the operating stock of fossil fuel producers (e.g. the differentiation of metallurgical versus thermal coal, the continued operation of sunk-cost facilities at variable cost, etc.). The authors found that DDP analyses could benefit from linking with a global model to maintain the balance of supply and demand, whereas global models can learn from the deep detail of national models used for DDPs.

In the same vein, global analyses – if sufficiently detailed – can help national analyses to balance supply and demand in traded GHG-intensive materials. In Denis-Ryan, Bataille, and Jotzo (2016) it was found that even with the best current technologies and reduced demand, iron, steel and cement demand could use up 20–25% of the 2°C global carbon budget, and that concentrated research and development in these areas is a key priority for meeting deep decarbonization targets. Given that the production of these commodities is concentrated in a few countries, they also reviewed key policies for dealing with these emissions in a world without common carbon pricing or emissions trading.

4. Future of the DDPP: expansion, engagement, & future research

The DDPP project has shown how deep decarbonization consistent with +2°C is technically possible in a set of countries that represent 74% of global energy system emissions. It has also shown that investment needs, mostly a diversion of investment from carbon-intensive infrastructure and equipment, are only slightly larger than those for a fossil fuel-based system, and may be compensated by lower ongoing fuel bills. Finally, it has begun to sketch out the long- and short-term policy needed to get there.

There are three main components to future plans for the DDPP: expansion, engagement and research. As per the idea that each sovereign country or region needs a DDP, it is planned to expand the DDPP methodology to other countries, in particular developing and emerging countries that may not have sufficient domestic resources. This will involve the creation and dispersal of an entry level DDPP toolkit to allow new low-capacity countries to join, as well as knowledge-sharing from the experience of the DDPP. One of the prime purposes of the project is to directly engage with international and national deep decarbonization stakeholders to help them build DDPs to help structure local policy debates in a problem-solving perspective.

Although this issue dealt with some research topics raised by the DDPP, much research remains to be done. Much more analysis is required to explore the cost of decarbonizing heavy industry, freight transportation and aviation. Work needs to be done on the design of robust and resilient policy frameworks for diverse settings, beyond the implementation of regulations and pricing (see Mathy et al. 2016). Overall macroeconomic impacts (GDP, welfare and economic structure) were addressed by only some of the country teams (see Bataille et al. 2016; Pye & Bataille 2016), and the challenge of analysing fundamental shifts in economic structure has not yet been mastered in modelling (see Grubb et al. (2015) for further discussion in the Chinese context). Changes in operational and consumption behaviors, lifestyles and spatial organization (notably urbanization) are all crucial drivers of emissions and have been treated only qualitatively at the global level or as scenario assumptions. A more fulsome treatment of uncertainty is also required, as well as a more in-depth analysis of the linkages between national transformations and global dynamics, notably trade in energy and GHG-intensive materials (see Denis-Ryan et al. 2016; Pye et al. 2016).

In summary, DDPs and the DDPP are designed to help domestic stakeholders and decision makers engage in sufficient discussion and negotiation to reach the necessary political consensus to proceed with short-term national climate policy that is consistent with the long-term decarbonization goals that are enshrined in the Paris Agreement.

Disclosure statement

No potential conflict of interest was reported by the authors.

ORCID

Chris Bataille http://orcid.org/0000-0001-9539-2489

Additional information

Funding

This work was supported by Agence Nationale de la Recherche [grant number ANR-10-LABX-14-01].

Notes

1. Ambition on the mitigation side is complemented by two other aims for adaptation (Art.2.1(b)) and finance (Art 2.1(c)).