China: issues and options in greenhouse gas emissions by Todd Johnson

By Todd Johnson

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287 East Asia's Environment: Principles and Priorities for Action. Jeffrey S. Hammer and Sudhir Shetty No. 288 Africa's Experience with Structural Adjustment: Proceedings of the Harare Seminar, May 23-24, 1994. Edited by Kapil Kapoor No. 289 Rethinking Research on Land Degradation in Developing Countries. Yvan Biot, Piers Macleod Blaikie, Cecile Jackson, and Richard Palmer-Jones No. 290 Decentralizing Infrastructure: Advantages and Limitations. Edited by Antonio Estache No. 291 Transforming Payment Systems: Meeting the Needs of Emerging Market Economies.

Such models have been used to simulate the effect of increasing concentrations of CO2 in the atmosphere. 2 While the impacts of future climate change are hard to predict, several studies have been concluded or are underway that explore potential global impacts. Most at risk from climate change will be communities that are least able to adapt and sectors that are most dependent on climate, such as agriculture. According to simulations done by the Intergovernmental Panel on Climate Change (IPCC), a doubling of CO2 will lead to a decline in global agricultural production of 68 percent, while in the developing countries the decline would be on the order of 1012 percent.

Cm. (World Bank discussion papers ; 330 Includes bibliographical references.  Series. 73'92'0951dc20 96-20971 CIP Page iii Contents Foreword v Acknowledgments vii Abstract ix Data Notes x Executive Summary 1 Introduction 1 Methodology 2 Factors affecting GHG emissions and options for reduction 3 The costs of GHG emission reduction 4 Recommendations 5 Chapter 1 Study Objectives and Background 9 Study objectives 9 Potential climate change impacts in China 10 Agricultural production 10 Sea-level rise 11 Terrestrial ecosystems 11 GHG sources and sinks inventory for China, 1990 12 Energy consumption 13 Energy production, storage, and distribution 14 Agricultural sector emissions 14 Cement 15 Forests and land use changes 15 Chapter 2 Macroeconomic Analysis 16 Introduction 16 The China Greenhouse Gas Model 16 Baseline GHG Scenario 18 Economic development and GHG emissions 18 Economic growth 19 Economic structure 20 A baseline energy use scenario 20 Sources of future declines in energy intensity 23 Options for limiting GHG emissions 24 Energy efficiency 24 Improvements in industrial energy efficiency 25 Alternative energy 28 Electric power alternatives 28 Non-power alternatives 29 Forestry 30 Agriculture 30 Conclusions 31 Future emissions 31 Environmental implications of the Baseline GHG Scenario 32 Summary of options for reducing GHG emissions 32 Chapter 3 The Costs of Limiting Emissions 34 Summary of least-cost options 34 Costs of GHG reduction 34 Significance testing 34 Energy efficiency 35 Alternative energy 35 Forestry 36 Agriculture 36 Page iv Energy efficiency 36 Introduction 36 Case study analysis: Concepts and methods 37 Industrial energy efficiency 38 Industrial restructuring projects 38 Incentives and constraints to implementing restructuring projects 39 Industrial energy conservation projects 40 Energy conservation projects in unhealthy enterprises 41 Incentives and constraints to conservation project implementation 41 High-efficiency energy-consuming equipment 42 Equipment producers 42 Consuming enterprises 43 Constraints to dissemination of high-efficiency equipment 43 Improved coal processing 44 Implementation issues and constraints 44 Energy-efficiency improvements in buildings and the residential sector 45 Alternative energy 45 Prospects for alternative energy technologies 46 Cost estimates for low-carbon energy sources 46 Coal substitutes for electric power generation 47 Alternative sources for direct use 48 GHG control in the forestry sector 50 China's forestry sector 50 Forest resources 50 FGHY program 50 Barriers to large-scale FGHY forestry development 51 Modeling carbon sequestration in China 51 Scenario assumptions 51 National forestry model 51 Forestry plantation models: Financial and economic analysis 51 Results of the financial analysis 52 Conclusions 53 GHG control in the agricultural sector 54 Reducing methane emissions from ruminant animals 54 Rice production 55 Chapter 4 Conclusions and Recommendations 56 Guiding principles 56 Recommended strategy for reducing GHG emissions in China 57 Economic reform 57 Enterprise reform 57 Incentives and regulatory framework 58 Factor market development 58 Environmental regulatory policy 58 Priority project areas 59 Improvements in energy efficiency 59 Alternative energy development 62 GHG control in the forestry sector 63 GHG control in the agricultural sector 63 International assistance for reducing GHG emissions in China 64 Conventional development assistance programs 64 Policy reform 64 Support for restructuring and no-regrets projects 64 Role of the Global Environment Facility 64 Expected criteria for GEF support 65 Overcoming market and non-market barriers 65 Page v Foreword Global climate change is one of the looming environmental threats of the 21st century.

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