sectoral economic costs and benefits of ghg mitigation - IPCC

Jonathan Pershing
uneven, and that regions with high reserves in one fuel do not necessarily have similarly high
reserves in others.
While this data is too aggregated to evaluate national impacts (a more disaggregated discussion is
provided below), it does provide a sense of where the heaviest impacts would be expected: North
America and the Asia-Pacific region have both the greatest abundance of coal and are the world’s
largest coal exporters, the Middle East has the greatest abundance of oil and is the largest
exporter, and the FSU and Middle East have the largest gas reserves while the FSU exports the
highest volumes.
A second issue that must be understood is the demand for the fossil fuels – and the projected
demand over the period covered by the Kyoto Protocol and beyond. Table 2, drawn from the
IEA’s World Energy Outlook, indicates the demand, by region, for each of the fossil fuels. It is
clear that the “business-as-usual-case”, demand is projected to grow significantly from 1990 to
2010: for example, gas use in South America is projected to grow at 4.6% per year gas (+147%
over the period), oil is projected to grow at 3.7% per year (+107% over the period), and coal is
projected to grow at 6.73% per year in the Middle East (+273% over the period). This is tied to a
growth in the global economy projected over the same period (the final column indicates the
percent growth in GNP projected for each region).
At present (and in the year 2010), the largest demand for fossil fuels comes from North America.
However, the largest growth comes from the Asia Pacific region. Linking issues of supply and
demand will fundamentally alter how individual national revenues will be affected and in
particular how the fossil fuel exporters will be affected by efforts to reduce emissions.
Table 2
Change in demand for Fossil Fuels 1990 – 2010 (million tonnes oil equivalent)
Region
N. America
(excl. Mexico)
Gas Demand Oil Demand Coal Demand GNP
1990 2010 % 1990 2010 % 1990 2010 % %
493.6 704.6 1.8 % 837.6 1025 1 % 551.8 736.6 1.5 % 2.3 %
S. America 74.8 185.1 4.6 % 248.9 243.8 2.7 % 20.3 44.2 -13.7 % 3.4 %
OECD Europe 243.3 506.1 3.7 % 617.1 779.1 1.2 % 398 371.5 -0.3 % 2.1 %
Middle East 79.9 164.2 3.7 % 151.3 218.8 1.9 % 3.4 12.7 6.7 % 2.4 %
FSU 614.1 646.7 0.3 % 473.2 329 -1.8 % 411.6 357 -0.7 % -0.5 %
Africa 31.9 70.5 4.0 % 87.8 145.4 2.6 % 74.7 111.7 2 % 2.1 %
Asia- Pacific 140.4 444.1 5.9 % 661.4 1372 3.7 % 829.3 1635 3.5 % 5.0 %
Bunkers 119 175 1.9%
World 1678 2721 2.5 % 3196 4468 1.7 % 2289.1 3269 1.8 % 3.1 %
Source: IEA, World Energy Outlook, 1998
Coal
The top ten coal producing countries account for nearly 90% of all coal reserves. The primary
use of coal is in power generation; more than 80% is used in transformation (including combined
heat and power), with the industry sector accounting for an additional 15%. Six percent of total
coal production is used as coking coal in the production of steel. In terms of its greenhouse gas
emissions, coal, in terms of units of CO 2 per unit of power generated, is 25 percent more CO 2
intensive than oil, and 60 percent more CO 2 intensive than natural gas. Because coal is relatively
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