The Influence of Climate Change Considerations on Energy Policy: The Case of Russia

Anil Markandya, Alexander Golub and E. Strukova
Additional contact information
E. Strukova: Environmental Defense

No 2003.92, Working Papers from Fondazione Eni Enrico Mattei

Abstract: To those working on climate change it is obvious that energy policy should be influenced by climate change considerations. The question that this paper seeks to answer is, to what extent do they influence policy and what contribution can a careful analysis of the costs and benefits of climate change options have on the formulation of that policy. We seek to understand this by looking in some detail at energy policy formulation in Russia. To do so it is necessary to look at the whole set of issues that determine energy policy. These include energy security, macroeconomic and uncertainty factors, local environmental issues and social issues. The analysis has been carried out for a specific case – that of the RF, where energy policy is currently under formulation to 2010. Two options have been looked at: a “High Coal” option, where there would be a substantial change in fuel mix away from gas to coal; and a “High Gas” option where the current fuel mix is retained and the increase in demand is met from all sources in proportion to current use. The analysis shows that, at international prices for fuels, the “High Coal” option is attractive. However, when we include the potential decline of price for natural gas in the European market, the relative preference for this option drops dramatically but it still remains the preferred option. When, account is also taken of the carbon benefits of the High Gas option, using plausible values for carbon, the attraction of the High Coal option is further reduced but not altered. When finally account is taken of the health associated with the lower use of coal in the High Gas option, the preference can be reversed but it requires a critical value for the health benefits. This critical value – at around $3,000 for a life year lost -- is plausible for the RF, if anything the actual value is probably higher. What the analysis shows is the need for a careful evaluation of the different factors determining energy policy. Among these is climate change. It is not the critical factor but it can be an important one. Perhaps more important are the environmental benefits that go with the lower carbon High Gas options.

Keywords: Climate policy; Russia; Ancillary benefits (search for similar items in EconPapers)
JEL-codes: D62 H41 J60 Q28 Q32 (search for similar items in EconPapers)
Date: 2003-10
New Economics Papers: this item is included in nep-cis
References: View complete reference list from CitEc
Citations: View citations in EconPapers (6)

Downloads: (external link)
https://feem-media.s3.eu-central-1.amazonaws.com/w ... oads/NDL2003-092.pdf (application/pdf)

Related works:
Journal Article: The influence of climate change considerations on energy policy: the case of Russia (2003)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:fem:femwpa:2003.92

Access Statistics for this paper

More papers in Working Papers from Fondazione Eni Enrico Mattei Contact information at EDIRC.
Bibliographic data for series maintained by Alberto Prina Cerai ( this e-mail address is bad, please contact ).