Carmen Bunzl - Universidad Pontificia Comillas

Chapter 4. Case Study: Spain 197
Implementing the package would require a considerable economic effort and
increased investment in renewable energy. Power plants, appliances and
transport must be made more energy-efficient. The Commission has estimated
the direct cost of achieving both the 20% GHG reduction target and the 20%
renewable energy target simultaneously at 0.58% of EU GDP or €91billion in
2020. Oil and gas imports are expected to go down by some € 50bn in 2020,
while electricity prices are likely to go up by 10-15% in comparison to today’s
level. Overall, this leads to an energy intensity improvement of approximately
32% between 2005 and 2020. If emission reduction credits from projects in third
countries such as CDM are allowed, costs are estimated to decrease to 0.45 % of
GDP (see EC 2008).
The proposal is to be discussed in parallel in the Council and the European
Parliament; if approved, the package would become operational after the
conclusion of the first commitment period of the Kyoto Protocol, in 2013. If
climate change is to be limited to 2ºC above the temperature in pre-industrial
times, global emissions need to be halved by the middle of this century. The
recently adopted Bali Roadmap in the latest Conference of the Parties was a
breakthrough, with all countries – included the US and major developing
countries – agreeing to start formal negotiations for a future international
climate change agreement as a follow-up to the Kyoto Protocol, to be concluded
by 2009.
3.3 Model analysis (FAIR 2.1)
This section analyses the emission reductions, abatement costs and reduction
measures for Spain for the two options for post-2012 EU burden-sharing and
ETS allocation presented in Section 3.2.
The analysis focuses on three scenarios based on different assumptions for
the level of international participation and the EU reduction objective:
• EU 20% unilateral without CDM. Emission allowances are traded freely
between the EU Member States, but this case assumes no availability of
Escuela Técnica Superior de Ingeniería ICAI Carmen Bunzl Boulet Junio 2008