Excited to share a new paper!

We find that estimated costs of renewable subsidies may be inflated because subsidies can correct a market failure that is often ignored. Same applies to CO2 pricing.

Open-access: 1/6 findingspress.org/article/94993-…
Liberalized power markets are characterized by a missing market problem. Investors in new generation face a lot of risk, which - if markets worked perfectly - investors could hedge by signing long-term contracts. But long-term contracts are not always available. 2/6

How should climate policies be combined? How much should we rely on standards vs. CO2 pricing?

Our paper with @KnittelMIT offers general and quantitative guidance based on theoretical and energy system modeling.

Hot-off-the-press & open access! doi.org/10.1016/j.enec… We previously shared a pre-print, which led to helpful discussions. Here, I will try to summarize the final version and offer more reflections on what it means for policy.

https://twitter.com/EmilDimanchev/status/1326148254271238144?s=20

✨New working paper!✨🧵

How expensive is transport decarbonization via hydrogen? What role is there for policy?

H2 has potential, but will require nothing less than a deliberate climate policy mix.

by Jonas Martin, myself & @anne_f_neumann

Link: ceepr.link/3FcC2MQ Why hydrogen? While electrification is the most promising pathway for lighter-duty transport, some sectors remain hard to abate. Specifically, trucking, shipping, & aviation are the main CO2 sources around 2050 across many decarbonization scenarios.

I’m excited to share new research with everyone!

We explore the role of EVs in deep decarbonization, model implications for near-term EV policy, and review EV state and trends, w/ @DavoodQorbani & @MagnusKorpas, in a peer-reviewed book chapter: onlinelibrary.wiley.com/doi/10.1002/97… 🧵 1/13 It’s widely acknowledged that EVs are important for decarbonization, but how much?

We provide a systematic review of decarbonization pathways for 2C and 1.5C, specifically focusing on pathways that represent vehicle fleets (all cars on the road) in technology-level detail. 2/13

This figure illustrates a really key point about #ElectricVehicles - cost parity is not the end of the road. They are on track to be *cheaper* to buy than gasoline vehicles (not to mention cheaper to drive and maintain).

Source: @TheICCT theicct.org/publications/u…. This is an example of how decarbonization is worth doing with or without climate change. We could be spending less on cars in a decarbonized future than if we don't decarbonize. More on that below.

https://twitter.com/EmilDimanchev/status/1315619195904720898?s=20

As clean industry grows, good information about it becomes more valuable & put behind paywalls. As a CO2 market analyst working behind a paywall for 5 years & having gone through a similar acquisition, my sympathies. It's nice to see the effort by @Ed_Crooks here. My 2 cents:

https://twitter.com/Ed_Crooks/status/1360308235434008576

A lot of the paywalled knowledge can be shared. Our clients at Point Carbon (bought by Thomson Reuters) generally didn't mind us sharing headline forecasts. What they paid for was the analysis & arguments behind the values, which is what made the information useful to them. #OCTT

Wow - many popular climate models have been assuming electric vehicles will remain more expensive than internal combustion engine cars all the way to 2100. As a modeler, I sympathize cost assumptions are hard but there’s a lot of room for improvement here. sciencedirect.com/science/articl… At current battery cost trends, EVs will reach cost parity with ICE in years, not decades or centuries as in these models (see thread below). E.g. BNEF projects cost parity in 2023. These are order of magnitude differences between bottom-up forecasting and climate modeling!

https://twitter.com/emildimanchev/status/1310591016630734849

A few thoughts on Tesla's battery day: 🔋🔋🔋

What does it mean for EV cost parity, and how about those V2G comments? Tesla said it will produce a $25,000 EV in 3 years. This will be achieved with cheaper battery cells, which were projected to cost 56% less in three years. wsj.com/articles/tesla…

For reference, average battery pack costs have declined 20%/year on average since 2010, per BNEF.

It’s here! Our new working paper w/ @WildeEcon explores the role of Canadian hydro in deep decarbonization, & shows we can get to zero CO2 faster & at lower cost by *both* deploying renewables in the US & making the most of existing hydro. THREAD.

ceepr.mit.edu/publications/w… @WildeEcon A growing number of Northeastern US states (New England states and New York) is making commitments for zero-carbon electricity by 2040 or 2050. greentechmedia.com/articles/read/… via @JMPyper

In New England we are taking a step back by retiring nuclear.

@HannahEDaly In addition to the other responses "Renewables" by @MichaelAklin and @jurpelai; Planetary Economics by @MichaelGrubb9 on carbon pricing in particular, e.g. EU failed 90s CO2 tax, but also energy taxation in general (e.g. Clinton BTU tax). David Victor, esp. for the intl. angle. @HannahEDaly @MichaelAklin @jurpelai @MichaelGrubb9 Of course, Australia's carbon tax provides ample fodder. Not seeing a paper in my records just now but a good start might be:

-nytimes.com/2014/07/25/opi…
-wsj.com/articles/austr…

New MIT paper corroborates narrative that 100% renewable pathway would probably be more expensive than incorporating other low-carbon sources. For strident climate hawks this might raise the question: why do we care so much about costs? 1. news.mit.edu/2018/adding-po… After all, no policy is ever 100% cost-effective. Society has always tolerated some inefficiency, to a large extent because democratic politics requires messy compromises. 2.