Full Paper - ESEE 2011 - Advancing Ecological Economics

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These environmentally extended multi-regional input-output (EEMRIO) models are able to track emissions impacts along international supply chains, across several trading partners. A full description of how MRIO models evolved is provided in the paper by Thomas Wiedmann (2009). The diagram in Figure 3 shows how different emissions accounts are constructed from a multiregional model, in this diagram the rest of the world is separated into four regions: OECD Europe, OECD non-Europe, non-OECD countries. 3 PRODUCTION (UK intermediate demand) 1 2 Production in the UK The image cannot be displayed. Your PRODUCTIONin computer may not have enough Rest memory of World to… 3 4 Production in Regions e, o and w 3a 3b Final consumption in the UK 5a, 5b CONSUMPTION (UK final demand) Exports from the UK Arrows should be read as “Emissions generatedby [beginning of arrow ] attributed to [end of arrow ]” Territorial Emissions(production-based indicator): 1 + 2 + 5a + 5b Consumer Emissions(consumption-based indicator): 1 + 3a + 4a + 5a + 5b Arrows should be read as 'emissions generated by [beginning of arrow] attributed to [end of arrow]'. This example is given with: Region e = OECD Europe, Region o = OECD non-Europe, Region w = non-OECD countries. Figure 3 Flow of GHG Emissions through the UK Economy (T Wiedmann et al. 2010b) 4a Consistent trade data is required in order to develop an MRIO model. These data are available for a range of base years at different levels of disaggregation. The most recent data is available in the Global Trade Analysis Project (GTAP 7) database (Narayanan et. al. 2008), which includes consistent bilateral trade data for 113 regions and 57 sectors 4 for the base year 2004. GTAP data are constructed from a worldwide network of national dataset providers as well as the UN Commodities Trade Database (UN Statistics 2008). In a full multi-directional model the trade flow matrices need to be imputed from the vector information provided (i.e. data on imports is provided as a vector from the supplying sector, it is not usually provide as a matrix to all sectors, (Thomas Wiedmann 2009)). The EEMRIO model is derived from Peters' (2007) multi-directional MRIO model of the GTAP6 database, which was updated by Hertwich and Peters (2010) based on the GTAP7 database which includes 113 countries. The EEMRIO model described in this paper is derived from results and output 3 Note: this diagram does not have the same regional split as the EEMRIO used in this project. The four regions used in this project are: the UK, the rest of the European Union, Other Annex B parties to the UNFCCC and non-Annex B parties to the UNFCCC. 4 The 57 sectoral classification is listed in Appendix B 4b 6
of this work. The resulting underlying EEMRIO model is a static representation of the economy detailing the transactions that have taken place over a set time frame of a year. The basic IO method has several characteristics which make it particularly well suited for simplified environmental analysis of complex systems. Firstly, the data are published internationally and available for free in most cases. This is in contrast with more detailed process-based life cycle inventory data which are costly or time consuming to collect and often unavailable due to proprietary concerns (Weinzettel, <strong>2011</strong>). Secondly, it produces results that are comparable across product groups, which is something that can be difficult to achieve in process life cycle assessments of individual products. It also offers accuracy, system completeness covering the entire economy, scalability, expandability and the possibility to combine the model with other economic or econometric modelling to develop scenarios. One of the main compromises with using the economy-wide input-output approach is the level of product and service disaggregation. The tables cannot include every single product or service purchased and consequently they are grouped into similar categories using a single classification (57 sectors in this case). In isolation an EEMRIO is therefore limited for understanding specific products and further restrictions such as a static economic structure, limited industrial energy demand data and limited scope for analysis the balance of energy use across different sectors of the economy mean that without additional tools or data it can be difficult to fully incorporate the assumptions of scenarios into a EEMRIO alone. The next section (Method) explains how the additional tools and techniques will be soft-linked with the EEMRIO in an effort to overcome some of these limitations. There are with EEMREIO, as with any model, additional technical and data limitations which should be understood when interpreting the results. The detailed technical aspects of the calculations involved and the problems encountered harmonising national datasets globally are described in detail in Appendix C, but for the purposes of this work we accept these limitations and will interpret any results accordingly. Method Modelling framework: the static baseline model The modelling framework uses an EEMRIO and extends it by soft-linking to an UK energy model and a consumption scenario tool and specific product process life-cycle analysis work. Soft-linking these framework extensions (additional scenario tools) to the EEMRIO model require manipulation of classification systems and some aggregation or disaggregation to align the different datasets. Softlinking allows the individual tools to retain their detail and independent analysis capabilities and they can be adjusted easily. This provides flexibility for the model in its current capacity and also for future alterations or additions. The EEMRIO model used in this project (as described in the Background to the modelling approaches section above) is aggregated from 113 regions to four, but retains the 57 GTAP sector breakdown. The aggregation of regions was done to reduce complexity, while maintaining the ability to examine trade relationships and climate policy ramifications and the potential impact of carbon leakage from countries with binding emissions reduction targets to countries outside the agreement. The four regions used to construct the model described in this paper are the UK, the rest of the European Union, other Annex B Parties to the UNFCCC and non-Annex B Parties to the UNFCCC. 7
Page 1 and 2: Paper prepared for the 9th conferen
Page 3 and 4: Abstract The official way of accoun
Page 5 and 6: Figure 1 UK GHG Emissions, 1992 to
Page 7: The Multi-Regional Input-Output Mod
Page 11 and 12: Bottom-up Top-down Simulation Simul
Page 13 and 14: E = energy use ES = energy service
Page 15 and 16: Changes to the direct emissions imp
Page 17 and 18: might lead to errors in the assignm
Page 19 and 20: References Agnolucci, P., Ekins, P.
Page 21 and 22: Office of National Statistics (2010
Page 23 and 24: Appendix A The standard generalised
Page 25 and 26: 50 atp Air transport 51 cmn Communi

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