Title: A counterfactual simulation exercise of CO₂ emissions abatement through fuel-switching in the UK (2008-2012)

Authors: Julien Chevallier; Erik Delarue; Emeric Lujan; William D'haeseleer

Addresses: Université Paris Dauphine (CGEMP/LEDa), Place du Marechal de Lattre de Tassigny, 75775 Paris Cedex 16, France. ' University of Leuven (K.U. Leuven) Energy Institute, TME Branch (Applied Mechanics and Energy Conversion), Celestijnenlaan 300A, Box 2421, B-3001 Leuven, Belgium. ' Energy Futures Lab, Imperial College London, South Kensington Campus, London SW7 2AZ, UK. ' University of Leuven (K.U. Leuven) Energy Institute, TME Branch (Applied Mechanics and Energy Conversion), Celestijnenlaan 300A, Box 2421, B-3001 Leuven, Belgium

Abstract: This paper uses the E-simulate model of electricity generation to estimate how much the stacking order of different technologies changes when a carbon price is introduced. Different coal and gas price scenarios are explored, and some sensitivity analysis is made of the relative market share of coal and gas under various carbon price levels. The objective of the paper is to estimate how much CO₂ reduction could happen in the UK through fuel switching (coal to natural gas) for different carbon price levels during Phase II (2008-2012) of the EU ETS. This country is indeed reported to have the greatest potential within the EU thanks to its suitable fuel mix (39% of coal and 36% of gas in 2007). Our results feature that 27 Mton of CO₂/year can be abated at carbon prices around e25/ton (essentially through fuel-switching during the summer), 36 Mton of CO₂/year can be abated at carbon prices around e40/ton (in that case, the carbon price triggers fuel-switching during the whole year), and that a maximum of 40 Mton of CO₂/year can be achieved at high carbon prices (e125/ton). We also provide various scenarios depending on the relative levels of fuel prices.

Keywords: CO2 emissions abatement; fuel switching; UK; United Kingdom; E-simulate model; European Union Emissions Trading Scheme; EU ETS; carbon tax; carbon emissions; carbon dioxide; electricity generation; carbon pricing; coal; natural gas; fuel prices.

DOI: 10.1504/IJGEI.2012.046712

International Journal of Global Energy Issues, 2012 Vol.35 No.5, pp.311 - 331

Received: 28 Mar 2011
Accepted: 06 Sep 2011
Published online: 30 Aug 2014 *

Full-text access for editors Full-text access for subscribers Purchase this article Comment on this article