sectoral economic costs and benefits of ghg mitigation - IPCC

Terry Barker, Lenny Bernstein, Ken Gregory, Steve Lennon and Julio Torres Martinez
• Marc Darras made the point that most decisions related to carbon reduction are not motivated
by global issues, but rather by local issues such as health, local air quality, etc. More
information on this aspect needs to be factored into externality studies. However there tends
to be a lot of disagreement on the exact quantification of externalities. It is clear that
externality studies can not be regarded as homogenous. It is therefore advisable to indicate a
spread of external costs which would vary with local conditions. Moreira expressed broad
agreement with this point and went on to propose that the development of common
methodologies be initiated with simple factors such as the means of defining the cost of a job
opportunity, and using these methodologies to provide macro guidance for all studies.
• Oliver Headley commented that the break point for the impact of GHG emissions in the
atmosphere did not appear to have been considered. The implications were substantial and
dramatic technological decisions needed to be made urgently. In the absence of well defined
renewable energy uptake strategies, technologies such as nuclear power were preferable to
ones which emitted GHGs. In the same way that nuclear energy development was largely
driven by political considerations, the uptake of renewables also required political
intervention.
During the general discussion the following general points were made:
• Steve Lennon commented that South African experience, based on the photovoltaic
electrification of in excess of 1500 rural schools and clinics, as well as a relatively new solar
home system programme for rural communities, indicated substantial ancillary benefits for
the renewables sector. In particular benefits can be ensured from the implementation of new
renewable energy technology in cost-effective niche applications. These benefits include:
- Unit cost reduction as installations increase. This is aided if innovative financing options
are developed, including: micro lending schemes and utility scale, long- term financing.
- The development of the local PV industry and infrastructure.
- The development of local small businesses for system installation and maintenance.
- An enhanced market for low electricity consumption end use electro-technologies for
domestic and community application.
- Small business development in electrified communities.
- Social, education, health and community usage benefits.
It was however stressed that continuity of such programmes is essential to ensure
sustainability and to avoid the loss of confidence in the market and weakening of the support
infrastructure.
• Ogun Davidson agreed with the need for continuity of programmes, highlighting the strong
potential for ancillary benefits being realised in the renewable sector, especially when
applied for rural development. He also stresses the need for continuity in both the industry as
well as in support for the technology once installed. Without this continuity the technology
and related development programmes will not be sustainable.
• Steve Lennon further indicated that the large-scale implementation of renewables technology
in a developing country requires the parallel development of a technological support
infrastructure; not only skills, but also industrial, R&D and institutional infrastructure. It
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