Carbon capture and sequestration: how much does this uncertain option affect near-term policy choices?

Laurent Gilotte (1) , Valentina Bosetti (2)

1 CIRED - centre international de recherche sur l'environnement et le développement
2 FEEM - Fondazione Eni Enrico Mattei [Milano]

Policy makers as well as many economists recognize geological Carbon Capture and Sequestration (CCS) as a key option to avoid costly emission reduction. While an extreme perspective is to envision CCS as a magic bullet to solve the issue of climate change, the economics perspective is more balanced and see it as a part of a portfolio of mitigation actions. Besides, as any novel mitigation technology, CCS can be implemented with a twofold purpose; on one side it can substitute some other technological efforts to reach a given environmental target. On the other side, it offers the opportunity to go for additional emission reductions and
reach a "safer" climate target. In order to balance these two
possible utilizations of CCS and assess their respective effects on
early policystrategies, we undertake a twofold numerical experiment.
First, a cost-efficiency analysis is undertaken where CCS sole effect
is substitution of other efforts. This is followed by a cost-benefit analysis where both purposes have to be balanced. We find that future availability of CCS is less a reason to relax near-term abatement efforts than what could be inferred from previous analyses. Moreover, cost-benefit analysis indicates that the environmental target should be more ambitious when CCS is included in the picture.

Mots clés: Climate Change; Uncertainty; Sequestration; Cost-benefit analysis

Mots clés: Changement climatique; Incertitudes; capture et séquestration du carbone; analyse coût-bénéfice; CO2

Domaines: Economies et finances

Laurent Gilotte, Valentina Bosetti. Carbon capture and sequestration: how much does this uncertain option affect near-term policy choices?. 2006. ⟨halshs-00007298⟩