The climate-security nexus for Europe,
examined with the POLES model
Patrick Criqui
Silvana Mima
LEPII-EPE
SECURE project, Milano, June 15-16, 2009
1
SECURE: purpose of the study

The SECURE project – in FP7 – aims at an
analysis of future energy Security of Supply
for Europe

The research needs to also take into account
the potential impacts of climate policies on the
world energy system

The Poles model is used to produce a limited
number of framing scenarios, to explore the
« climate change and energy security nexus »
SECURE project, Milano, June 15-16, 2009
2
The POLES model

POLES is a partial equilibrium model of the world energy system, with
year by year simulation to 2100 of supply, demand and price

Population, GDP by region, Oil and Gas resources, are exogenous

Technology costs and performances of 50 key energy technologies,
either exogenous (TECHPOLdb) or endogenous with Two Factor
Learning Curves

Simulation provides international energy prices, full energy balance for
47 regions, CO2 and other GHG emissions for 13 final sectors

Simulation of GHG abatement policies with a central role of explicit
prices and costs of energy technologies

Introduction of the impacts of climate change on the energy sector and
to perform assessment of the adaptation costs

Limitations: no explicit macro-economic model and built-in feed-back
SECURE project, Milano, June 15-16, 2009
3
1+3 scenarios explored with the POLES model

The Baseline case is a counter-factual no climate
policy scenario, used mostly for benchmarking

The Muddling Through scenario describes the
consequences of non-coordinated, low profile climate
policies

The Europe Alone case represents the outcome of a
scenario in which every country is free-riding (almost)
in climate policy … except the Union

The Global Regime explores a new world energy
system, under strong emission constraint (EU-type)
SECURE project, Milano, June 15-16, 2009
4
SECURE scenarios, hypotheses and outcomes
Carbon
Price 2050
(€/tCO2)
Emissions
2050 / 2000
AR4
categories
Baseline
0
131%
Type VI
700 CO2
Muddling
Through
40 in Eur
30 in RoW
36%
Type IV
500 CO2
Europe Alone
300 in Eur
30 in RoW
30%
Type IV
500- CO2
-50%
Type II
400 CO2
Global Regime
300
SECURE project, Milano, June 15-16, 2009
5
Baseline
Muddling Through
Europe Alone
Global Regime
Energy Dependence / Vulnerability
SECURE project, Milano, June 15-16, 2009
6
The Baseline

In the Baseline case, world energy consumption
and CO2 emissions double in 2050
 Oil and Gas peak in 2030 and 2040, while coal
more than doubles, to 6.5 Gtoe in 2050
 EU energy consumption stabilizes after 2030 (EU
gas at 540 Gm3 in 2050)
EU27 primary energy
World primary energy
20
2 500
2 000
Gtoe
15
3 000
Other Renewables
Biomass
Nuclear
Coal, lignite
Natural gas
Oil
Mtoe
25
1 500
10
1 000
5
500
0
0
2000
2010
2020
2030
2040
2050
SECURE project, Milano, June 15-16, 2009
2000
2010
2020
2030
7
2040
2050
Pratt (1942)
Duce (1946)
Pouge (1946)
Weeks (1948)
Leverson (1949)
Weeks (1949)
MacNaughton (1953)
Hubbert (1956)
Weeks (1958)
Weeks (1959)
Hendricks (1965)
Ryamn (1967)
Shell (1968)
Weeks (1968)
Hubbert (1969)
Moody (1970)
Weeks (1971)
Warman (1972)
Bauquis (1972)
Schweinfurth (1973)
Linden (1973)
Bonillas (1974)
Howitt (1974)
Moody (1975)
WEC (1977)
Nelson (1977)
De Bruyne (1978)
Klemme (1978)
Nehring (1978)
Nehring (1979)
Halbouty (1979)
Meyerhoff (1979)
Roorda (1979)
Halbouty (1979)
WEC (1980)
Strickland (1981)
Coliti (1981)
Nehring (1982)
Masters (1983)
Kalinin (1983)
Martin (1984)
Ivanhoe (1984)
Masters (1987)
Campbell (1991)
Masters (1991)
Townes (1993)
Petroconsult. (1993)
Masters (1994)
USGS (2000)

Oil production
profiles and URRs
are in the upper
range of the available
bottom-up estimates
(P.R. Bauquis, ASPO)
Mbd
60
0
SECURE project, Milano, June 15-16, 2009
Gbl
Unsustainability, chapter 1
100
Total
Gulf
Conventionnal
Oil Production
0
2000
2010
1940
1949
5 000
2020
1950
1959
2030
Gb
1960
1969
Conventional Oil Reserves - World
4 500
80
4 000
3 500
3 000
40
20
2040
2050
2 500
2 000
Oil Reserves
1 500
1 000
500
0
2000
2010
Cumulative Production
1970
1979
8
2020
URR
2030
1980
1989
Source: IFP/DSEP adapted from Martin (1985) and Campbell (1992) - Updated 2000
2040
3500
3000
2500
2000
1500
1000
500
1990
2000
2050
* Cumulative production + proven reserves +
possible reserves yet to be discovered
Cumulative Discoveries
Unsustainability, chapter 2
World Primary consumption by region
World CO2 emissions by sector (energy)
25
50


40
Transformation
Transport
Res-Ser-Agr
Industry
20
CAN
JAP. PACIFIC
CHN
BRA
MIEA
RLAM
35
15
30
Gtoe
GHGs emission
profiles correspond
to the highest
category identified
in IPCC-AR4
The corresponding
expected
temperature
increase is of more
than 5°C
… from risk to
radical uncertainty
(M. Weitzman)
GtCO2

45
USA
EUROPE
CIS
NDE
AFR
RASIAJ
25
20
10
15
10
5
5
0
2000
SECURE project, Milano, June 15-16, 2009
2010
2020
2030
2040
2050
0
2000
2010
9
2020
2030
2040
2050
Baseline
Muddling Through
Europe Alone
Global Regime
Energy Dependence / Vulnerability
SECURE project, Milano, June 15-16, 2009
10
Muddling Through

Introcucing a 40 €/tCO2 in EU and 30 in RoW
carbon price doesn’t change drastically the
conditions of international energy markets
Carbon Value - Sc. 1
45
Europe
40
Rest of the w orld
35
€05/tCO2
30
25
20
15
10
5
0
2000
2010
2020
2030
2040
SECURE project, Milano, June 15-16, 2009
2050
11
Muddling Through



World fossil consumption is stabilized after 2020 due to
lower demand, higher non carbon energies
Emissions stabilize at a lower level compared to 2000,
thanks to CCS (Type IV in IPCC AR4)
European energy is mostly impacted through the
substitution of nuclear to coal in power generation and
by CCS
Total Em issions by region
World Prim ary consum ption - Sc. 1
20
45
Other Renew ables
Biomass
Nuclear
Coal, lignite
Natural gas
Oil
RLAM
40
GtCO2 eq
25
Gtoe
15
10
5
RASIAJ
35
AFR
30
MIEA
BRA
25
NDE
20
CHN
15
CIS
10
JANZC
WEUR
5
CAN
0
2000
0
2000
2010
2020
2030
2040
2010
2020
2030
2050
SECURE project, Milano, June 15-16, 2009
12
2040
2050
USA
Baseline
Muddling Through
Europe Alone
Global Regime
Energy Dependence / Vulnerability
SECURE project, Milano, June 15-16, 2009
13
Europe Alone

The carbon value diverges between EU and
RoW from one order of magnitude:
300 vs 30 €/tCO2
Carbon Value - Sc. 2
350
Europe
300
Rest of the w orld
€05/tCO2
250
200
150
100
50
0
2000
2010
2020
2030
2040
SECURE project, Milano, June 15-16, 2009
2050
14
Europe alone

This allows a reduction of 70% in EU CO2
emissions in 2050
EU27 - Total and CO2 emissions - Sc. 2
EU27 Primary consumption - Sc. 2
3 000
6
Other Renew ables
CO2 EU27
Biomass
2 500
CO2Eq EU27
Nuclear
5
Coal, lignite
Natural gas
4
Oil
GtCO2eq
Mtoe
2 000
1 500
3
2
1 000
1
500
0
0
2000
2000
2010
2020
2030
2040
2010
2020
2030
2050
SECURE project, Milano, June 15-16, 2009
15
2040
2050
Europe Alone

A significant part of emission reductions
comes from the electricity sector, from the
development of Renewable, Nuclear and CCS
EU27 Electricity Production w ith and w /o Sequestration
EU27 Electricity production
6 000
6 000
Other renew ables
Nuclear
5 000
Thermal With SEQ
Thermal WO SEQ
Biomass
5 000
Other
Coal, lignite
Natural gas
4 000
Oil
TWh
TWh
4 000
3 000
3 000
2 000
2 000
1 000
1 000
0
2000
2010
2020
2030
2040
2050
SECURE project, Milano, June 15-16, 2009
0
2000
2010
2020
2030
16
2040
2050
Baseline
Muddling Through
Europe Alone
Global Regime
Energy Dependence / Vulnerability
SECURE project, Milano, June 15-16, 2009
17
Global Regime


In the Global Regime, a world 300 €/tCO2 carbon value
allows for halving world emissions in 2050
With strong consequences on fossil demand and prices,
i.e. a stabilization of oil and gas prices
Carbon Value
350
Annex1
300
Rest of the w orld
€05/tCO2
250
200
150
100
50
0
2000
2010
2020
2030
2040
SECURE project, Milano, June 15-16, 2009
2050
18
Global Regime: world


This case implies much lower world demand, at 16
Gtoe, and a new fuel mix
Fossil consumption in 2050 is near to the 2000
situation (lower oil, higher gas) CCS makes the rest of
abatement
Total Emissions by
World Prim ary consum ption
35
40
35
30
30
RLAM
Transformation
Transport
Res-Ser-Agr
Industry
RASIAJ
AFR
MIEA
25
GtCO2
Gtoe
15
Other Renew ables
Biomass
Nuclear
Coal, lignite
Natural gas
Oil
10
GtCO2 eq
20
World CO2 emissions by sector (energy)
20
25
BRA
NDE
20
CHN
15 15
CIS
10 10
5
5
JANZC
WEUR
5
CAN
0
0
2000
2010
2020
2030
2040
2050
SECURE project, Milano, June 15-16, 2009
0
2000
2000
USA
2010
2010
2020
2020
2030
2030
19
2040
2050
2040
2050
Global Regime: Europe

EU’s total demand is lower in 2050 than in 2000, but half
of total supply is from non carbon energies, renewable
and nuclear
Natural gas is peaking at 530 Gm3 in 2020, to 390 Gm3
in 2050, oil demand is halved in 2050
EU27 Prim ary cons um ption
3 000
2 500
2 000
Mtoe

Other Renew ables
Biomass
Nuclear
Coal, lignite
Natural gas
Oil
1 500
1 000
500
0
2000
2010
SECURE project, Milano, June 15-16, 2009
2020
2030
2040
2050
20
Baseline
Muddling Through
Europe Alone
Global Regime
Energy Dependence / Vulnerability
SECURE project, Milano, June 15-16, 2009
21
Dependence rate, by energy and global

The dependence rate does not change very
much from one scenario to the other
 While global dependence rate (on total GIC)
is significantly altered
Dependance rate
Baseline
Dependance rate
Muddling Through
Dependance rate
Europe alone
Dependance rate
Global Regime
Coal, lignite
Oil
Natural gas
Total
Coal, lignite
Oil
Natural gas
Total
Coal, lignite
Oil
Natural gas
Total
Coal, lignite
Oil
Natural gas
Total
SECURE project, Milano, June 15-16, 2009
2000
30%
76%
46%
45%
30%
76%
46%
45%
30%
76%
46%
45%
30%
76%
46%
45%
2010
33%
81%
51%
48%
32%
81%
52%
48%
33%
81%
52%
48%
33%
81%
51%
48%
2020
39%
84%
57%
51%
36%
83%
58%
50%
34%
83%
58%
50%
34%
83%
58%
50%
2030
48%
87%
64%
54%
46%
86%
64%
53%
44%
85%
62%
49%
44%
86%
63%
50%
22
2050
56%
86%
73%
53%
53%
85%
72%
48%
51%
78%
59%
34%
50%
87%
69%
38%
GIC and volume of fossil imports

Dependence may be lower and also applied to
smaller quantities

In terms of vulnerability, importing 40% of
200 Mtoe is not equivalent to 40% of 400 Mtoe
GIC (Mtoe)
Imports (Mtoe)
Baseline
GIC (Mtoe)
Imports (Mtoe)
Muddling Through
GIC (Mtoe)
Imports (Mtoe)
Europe alone
GIC (Mtoe)
Imports (Mtoe)
Global Regime
Coal, lignite
Oil
Natural gas
Coal, lignite
Oil
Natural gas
Coal, lignite
Oil
Natural gas
Coal, lignite
Oil
Natural gas
SECURE project, Milano, June 15-16, 2009
2000
1725
-94
-505
-180
1725
-94
-505
-180
1725
-94
-505
-180
1725
-94
-505
-180
2010
1764
-102
-532
-217
1758
-95
-533
-221
1760
-97
-533
-220
1759
-96
-533
-220
2020
1882
-130
-560
-271
1822
-98
-542
-276
1803
-86
-533
-278
1798
-86
-533
-276
2030
2003
-192
-564
-335
1921
-149
-536
-328
1806
-119
-474
-291
1804
-118
-486
-301
23
2050
2050
-286
-439
-355
1899
-190
-399
-323
1663
-138
-239
-189
1667
-125
-281
-231
Value of energy imports

From 1.05 to 2.3% of EU GDP between 2000 and
2050 in Baseline
Value of imports (G€05)
Baseline
Value of imports (G€05)
Muddling Through
Value of imports (G€05)
Europe alone
Value of imports (G€05)
Global Regime
Coal, lignite
Oil
Natural gas
Total
Coal, lignite
Oil
Natural gas
Total
Coal, lignite
Oil
Natural gas
Total
Coal, lignite
Oil
Natural gas
Total
SECURE project, Milano, June 15-16, 2009
2000
4,9
96,1
24,1
125,1
4,9
96,1
24,1
125,1
4,9
96,1
24,1
125,1
4,9
96,1
24,1
125,1
2010
8,8
203,0
51,6
263,4
8,2
203,3
52,6
264,1
8,3
203,2
52,4
264,0
8,3
203,4
52,4
264,1
2020
12,4
250,8
68,8
332,0
9,2
240,8
70,1
320,1
8,1
235,9
70,7
314,8
7,7
226,8
68,2
302,8
2030
19,9
311,4
101,1
432,3
14,9
282,9
95,4
393,3
11,9
246,6
83,7
342,2
11,4
219,7
77,3
308,3
24
2050
34,3
359,6
160,1
554,0
21,7
288,8
134,7
445,2
15,6
168,0
77,0
260,7
13,7
118,9
62,7
195,3
Conclusions – 1: risks and policies
Riskc/e =
Probabilitye
x Magnitudee
x Vulnerabilityc/e
Muddling Through
High
High
High
Europe Alone
High
High
Low
Global Regime
Low
Low
Low

Strong climate policies bring a significant double
dividend in terms of reduced vulnerability to energy
shocks, even in a non-cooperative framework

This holds for Europe, but may be true for any
importing region
SECURE project, Milano, June 15-16, 2009
25
Conclusions - 2

The SECURE scenario allow to analyse the key policy
issues in strategic terms

They show that climate policies are strongly
structuring the energy security problem, whether in a
cooperative or non-cooperative world

Beyond pure modelling and scenarios, many issues
should be kept in mind in the storylines and analyses,
in particular the institutional dimension for:
- Framework and incentives for energy investment
- Degree of integration of the European electricity system
- Institutional factors in new technology chains (scale-up of CCS)
- Regulatory framework for nuclear development
SECURE project, Milano, June 15-16, 2009
26