Stranded asset implications of the Paris Agreement in Latin America and the Caribbean
Abstract
Achieving the Paris Agreement's near-term goals (Nationally Determined Contributions, NDCs) and long-term temperature targets could result in pre-mature retirement, or stranding, of carbon-intensive assets before the end of their useful lifetime. We use an integrated assessment model to quantify the implications of the Paris Agreement for stranded assets in Latin America and the Caribbean (LAC), a developing region with the least carbon-intensive power sector in the world. We find that meeting the Paris goals results in stranding of 37-90 billion and investment of 1.9-2.6 trillion worth of power sector capital (2021-2050) across a range of future scenarios. Strengthening the NDCs could reduce stranding costs by 27-40%. Additionally, while politically shielding power plants from pre-mature retirement or increasing the role of other sectors (e.g. land-use) could also reduce power sector stranding, such actions could make mitigation more expensive and negatively impact society. For example, we find that avoiding stranded assets in the power sector increases food prices 13%, suggesting implications for food security in LAC. Our analysis demonstrates that climate goals are relevant for investment decisions even in developing countries with low emissions.
- Authors:
-
[1];
[3];
[6];
- Pacific Northwest National Lab. (PNNL), College Park, MD (United States)
- (Jae) [Pacific Northwest National Lab. (PNNL), College Park, MD (United States)
- Inter-American Development Bank, Washington, D.C. (United States)
- Univ. Del Rosario, Bogota (Colombia)
- Univ. de los Andes, Bogota (Colombia)
- Pontificia Univ. Catolica de Valparaiso, Valparaiso (Chile)
- Univ. Federal do Rio de Janeiro, Rio de Janeiro (Brazil)
- Univ. of Maryland, College Park, MD (United States)
- Publication Date:
- Research Org.:
- Pacific Northwest National Lab. (PNNL), Richland, WA (United States)
- Sponsoring Org.:
- USDOE
- OSTI Identifier:
- 1572090
- Report Number(s):
- PNNL-SA-141669
Journal ID: ISSN 1748-9326
- Grant/Contract Number:
- RG-K1447; RG-T2728; AC05-76RL01830
- Resource Type:
- Accepted Manuscript
- Journal Name:
- Environmental Research Letters
- Additional Journal Information:
- Journal Volume: 15; Journal Issue: 4; Journal ID: ISSN 1748-9326
- Publisher:
- IOP Publishing
- Country of Publication:
- United States
- Language:
- English
- Subject:
- 54 ENVIRONMENTAL SCIENCES
Citation Formats
Binsted, Matthew, Iyer, Gokul C., Edmonds, James, Vogt-Schilb, Adrien, Arguello, Ricardo, Cadena, Angela, Delgado, Ricardo, Feijoo, Felipe, Lucena, Andre F. P., McJeon, Haewon C., Miralles-Wilhelm, Fernando, and Sharma, Anjali. Stranded asset implications of the Paris Agreement in Latin America and the Caribbean. United States: N. p., 2020.
Web. doi:10.1088/1748-9326/AB506D.
Binsted, Matthew, Iyer, Gokul C., Edmonds, James, Vogt-Schilb, Adrien, Arguello, Ricardo, Cadena, Angela, Delgado, Ricardo, Feijoo, Felipe, Lucena, Andre F. P., McJeon, Haewon C., Miralles-Wilhelm, Fernando, & Sharma, Anjali. Stranded asset implications of the Paris Agreement in Latin America and the Caribbean. United States. https://doi.org/10.1088/1748-9326/AB506D
Binsted, Matthew, Iyer, Gokul C., Edmonds, James, Vogt-Schilb, Adrien, Arguello, Ricardo, Cadena, Angela, Delgado, Ricardo, Feijoo, Felipe, Lucena, Andre F. P., McJeon, Haewon C., Miralles-Wilhelm, Fernando, and Sharma, Anjali. Fri .
"Stranded asset implications of the Paris Agreement in Latin America and the Caribbean". United States. https://doi.org/10.1088/1748-9326/AB506D. https://www.osti.gov/servlets/purl/1572090.
@article{osti_1572090,
title = {Stranded asset implications of the Paris Agreement in Latin America and the Caribbean},
author = {Binsted, Matthew and Iyer, Gokul C. and Edmonds, James and Vogt-Schilb, Adrien and Arguello, Ricardo and Cadena, Angela and Delgado, Ricardo and Feijoo, Felipe and Lucena, Andre F. P. and McJeon, Haewon C. and Miralles-Wilhelm, Fernando and Sharma, Anjali},
abstractNote = {Achieving the Paris Agreement's near-term goals (Nationally Determined Contributions, NDCs) and long-term temperature targets could result in pre-mature retirement, or stranding, of carbon-intensive assets before the end of their useful lifetime. We use an integrated assessment model to quantify the implications of the Paris Agreement for stranded assets in Latin America and the Caribbean (LAC), a developing region with the least carbon-intensive power sector in the world. We find that meeting the Paris goals results in stranding of 37-90 billion and investment of 1.9-2.6 trillion worth of power sector capital (2021-2050) across a range of future scenarios. Strengthening the NDCs could reduce stranding costs by 27-40%. Additionally, while politically shielding power plants from pre-mature retirement or increasing the role of other sectors (e.g. land-use) could also reduce power sector stranding, such actions could make mitigation more expensive and negatively impact society. For example, we find that avoiding stranded assets in the power sector increases food prices 13%, suggesting implications for food security in LAC. Our analysis demonstrates that climate goals are relevant for investment decisions even in developing countries with low emissions.},
doi = {10.1088/1748-9326/AB506D},
journal = {Environmental Research Letters},
number = 4,
volume = 15,
place = {United States},
year = {Fri Apr 03 00:00:00 EDT 2020},
month = {Fri Apr 03 00:00:00 EDT 2020}
}
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Works referencing / citing this record:
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