Cost of mitigation

Abstract

Cost is one of the key factors for technology selection. Mature technologies that are competitive in the market without climate policies exist, on one hand. On the other hand, there exist technologies for which costs are still high but are expected to be reduced with diffusion. This chapter gives an overview of the costs of climate mitigation. Firstly, the levelized costs for the technologies of energy and CO2 emission reductions, particularly in power sectors, are summarized. Secondly, CO2 abatement costs for various technologies are discussed. Finally, economy-wide costs, including carbon leakage effects, are assessed. From the viewpoint of individual technologies, there are different features, roles, and stages of progress, and a good mix of technologies is required considering multiple objectives, different features, and other factors. Differences in marginal abatement costs among countries induce carbon leakages and larger economic impacts in today's globalized world. Balanced policy measures will be required considering mitigation costs and development stages for each technology, as well as economy-wide costs. © Springer-Verlag London 2012.