remindmodel / remind

REMIND - REgional Model of INvestments and Development
Other
93 stars 123 forks source link

New realizations diffExp2Lin and diffLin2Lin in 45_carbonprice #1723

Closed laurinks closed 2 weeks ago

laurinks commented 2 weeks ago

Purpose of this PR

  1. Enable stronger carbon price differentiation - see new switch cm_co2_tax_spread (introduced by Nico)
  2. Combine exponentially increasing carbon prices and carbon price differentiation which is needed for overshoot scenarios in ScenarioMIP - see new realization diffExp2Lin (with cm_iterative_target_adj = 5)
  3. Enable exponentially increasing carbon prices until peak year that remain constant thereafter (or increase linearly at fixed slope) - this corresponds to theoretically optimal Hotelling's rule - see new realization diffExp2Lin (with cm_iterative_target_adj = 9 and cm_co2_tax_spread = 1)
  4. Creating new realization diffLin2Lin based on current default diffCurvPhaseIn2Lin. The changes concern 1., minor code clean up and a quick fix for more near-term realism in PkBudg runs - see also this issue. More changes are expected in the next weeks. The goal is that diffLin2Lin will eventually replace diffCurvPhaseIn2Lin as the default forPkBudg runs.
  5. Updating default growth rate for exponential carbon pricing (cm_co2_tax_growth) to 4.5% instead of 5% in order to be consistent with this change. Note that this does not affect any AMT runs.

Type of change

(Make sure to delete from the Type-of-change list the items not relevant to your PR)

Checklist:

Further information (optional):

At Reviewers: It's my first pull request, so I am thankful for a careful check and for any feedback!

laurinks commented 2 weeks ago

Comparison of diffCurvPhaseIn2Lin (left) and diffLin2Lin (right) (see /p/tmp/laurinko/hpc/remind/compScen-diffCurvPhaseIn2LinVSdiffLin2Lin-2024-07-04_17.19.36-H12.pdf): image Observations and comments:

  1. CO2 prices in 2025 are substantially lower in diffLin2Lin due to linear curve going through 0 in 2020 instead of 2010. This quick fix leads to more near-term realism. Further improvements will follow (e.g. to deal with somewhat too low CO2 prices in PkBudg1050). This naturally leads to higher CO2 prices at peak.
  2. Updated carbon price differentiation changed spread factors for some mid-income countries
laurinks commented 2 weeks ago

Comparison of convergence year 2050 and 2070 (see /p/tmp/laurinko/hpc/remind/compScen-conv-2050VS2070-2024-07-04_17.22.40-H12.pdf): image Illustration of later convergence year (default = 2050 on LHS, 2070 on RHS) for CO2 budget of 650 Gt with different shapes of CO2 prices (diffLin2Lin on TOP, diffExp2Lin with PkBudg in MIDDLE, diffExp2Lin with EocBudg on BOTTOM) image Delayed convergence leads to lower CO2 prices (world average) mid-century, but then requires higher CO2 prices (world average) at the end of the century.

laurinks commented 2 weeks ago

Comparison of diffLin2Lin (left) and diffExp2Lin (right) for different peak budgets (see /p/tmp/laurinko/hpc/remind/compScen-diffExpVSLin2Lin-2024-07-04_17.25.37-H12.pdf): image Comments:

  1. diffLin2Lin has lower CO2 prices in 2025 because the linear curve (if visually extended) goes through 0 in 2020. This leads to improved near-term realism.
  2. diffExp2Lin has quite high CO2 prices in 2025. This is inherent to the realization because the developed countries follow an exponential CO2 price path with rate given by the internal interest rate (from Hotelling's rule, here 4.5%). The realization can only shift up and down the carbon price in the start year in order to match the prescribed peak budget.
laurinks commented 2 weeks ago

Comparison of old default of 5% (green) and new default of 4.5% (red) in a run with 650 Gt end-of-century budget and exponential CO2 price increase until 2100 (see /p/tmp/laurinko/hpc/remind/compScen-exp-rate-change-2024-07-04_17.16.17-H12.pdf): image

laurinks commented 2 weeks ago

The stronger carbon price differentiation mostly affects regions with relatively low GDP per capita (PPP): image Indeed, differences in the plots only become visible upon closer inspection. This will be more pronounced if convergence in delayed to 2070: image image