The MIT Integrated Global System Model: EPPA Component
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Anthropogenic Emissions and Policy Analysis (EPPA) Model
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Other IGSM Components:
Climate and Chemistry and
Ecosystems & Natural Fluxes
The MIT Emissions Prediction and Policy Analysis (EPPA) model is used to analyze the processes that produce greenhouse-relevant emissions, and to assess the consequences of policy proposals intended to control these emissions. It is a global, applied general equilibrium model of economic growth, international trade, and greenhouse gas emissions (CO2, CO, CH4, SO2, NOx, N2O, NH3, CFCs, PFCs, HFCs, SF6) from a set of trade-linked economic regions. The model also includes consideration of non-methane volatile organic compounds (NMVOCs), and black carbon and organic carbon aerosols, which are important inputs to the atmospheric chemistry-climate component of the IGSM.
The EPPA model is used to compute predictions of anthropogenic emissions of the key greenhouse gases and aerosols generated from the world's economies and energy usage, and converts them into distributions by latitude where needed. Special provision is made for analysis of uncertainty in key influences, such as the growth of population and economic activity, and the pace and direction of technical change. Further, EPPA has been formulated to support analysis of a variety of emissions control policies, providing estimates of the magnitude and distribution among nations of the costs, and clarifying the ways that changes are mediated through international trade. Several applications of the are described in several publications.
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The Emissions Prediction and Policy Analysis (EPPA) model is a computable general equilibrium model of economic growth, international trade, and greenhouse gas emissions. It considers the countries, regions, sectors and substances shown in the table shown below, to calculate paths of future greenhouse emissions, and to provide economic analysis of proposed control measures.
Examination of human influence on future climate begins with the prediction of future levels of emissions of greenhouse gases and aerosols. At the same time, it is necessary to address future economic and technological change in some detail. Because many of the important chemical species that determine atmospheric levels of pollutants and greenhouse gases exist only for a short time in the atmosphere, the Program's approach is to predict economic development and the resulting emissions of trace gases as functions of geographic location as well as time. For example, our predictions of sulfate aerosols and ozone take account of expected shifts of emissions during the next century from Europe and North America to China and Southern Asia. For this purpose, and for policy analysis, the IGSM includes a global economic development model that addresses economic growth, technological change, and the resulting changes in the magnitude, composition, and location of future anthropogenic emissions.
Previous research at MIT on greenhouse gas emissions and their control resulted in the development of the EPPA model, which is built on a comprehensive energy-economy data set developed by the Global Trade Analysis Project (GTAP) that accommodates a consistent representation of energy markets in physical units as well as detailed accounts of regional production and bilateral trade flows. In addition, estimates of non-CO2 gases and sinks have been introduced in the calculation of least-cost abatement. The emissions coefficients and the sectors and activities to which they are attached in EPPA have been updated to reflect current inventory estimates, which have significantly improved as a result of the improved monitoring, estimation and reporting of emissions by country and sector, as required under the Framework Convention on Climate Change. The EPPA model was initially based on the General Equilibrium Environmental (GREEN) model developed by the Organization for Economic Cooperation and Development (OECD), but has been significantly modified and extended in its development at MIT.
The EPPA model takes account of the supply of input factors available to a region: labor, capital, imports, and natural resources. These are matched with the demand from various sectors. Demand for the output of the producer sectors comes from a set of household, government, investment and export sectors, and are paid for with income earned from the provision of the input factors, taxes and foreign exchange. Savings by consumers affect future economic output through the accumulation of capital. Because of its importance for greenhouse gas emissions, the energy sector includes separate treatments for oil, gas and coal, and fossil and non-fossil fuel technologies that might replace conventional sources in the long term. The model takes account of estimated in-ground resources in the different regions, and their depletion as production proceeds over time. It separately identifies the electric sector, and accounts for its input fuels, including nuclear and other non-fossil technologies, for example, wind and solar. Greenhouse- and pollution-relevant gases resulting from the economic activities considered in the model are predicted for each economic region, and then used as inputs to the climate model.
Further information about the EPPA model, and samples of its application to policy questions, are described in the following publications:
- The EPPA Model:
- The MIT Emissions Prediction and Policy Analysis (EPPA) Model: Version 4
MIT JOINT PROGRAM REPORT 125
Paltsev et al., 2005.
- The MIT Emissions Prediction and Policy Analysis (EPPA) Model: Revisions, Sensitivities, and Comparisons of Results
MIT JOINT PROGRAM REPORT 71 Babiker et al., 2001.
- Economic and Policy Analysis (e.g., Differential Policies, Taxes, Health):
- Energy Scenarios for East Asia: 2005-2025
MIT JOINT PROGRAM REPORT 152
Paltsev & Reilly, 2007.
- U.S. Greenhouse Gas Cap-and-Trade Proposals: Application of a Forward-Looking Computable General Equilibrium Model
MIT JOINT PROGRAM REPORT 150
Gurgel et al., 2007.
- Global Economic Effects of Changes in Crops, Pasture, and Forests due to Changing Climate, Carbon Dioxide, and Ozone
ENERGY POLICY 35(11): 5370-5383
Reilly et al., 2007;
also MIT JOINT PROGRAM REPORT 149.
- Assessment of U.S. Cap-and-Trade Proposals
MIT JOINT PROGRAM REPORT 146
Paltsev et al., 2007.
- Biomass Energy and Competition for Land
MIT JOINT PROGRAM REPORT 145
Reilly & Paltsev, 2007.
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Heavier Crude, Changing Demand for Petroleum Fuels, Regional Climate Policy, and the Location of Upgrading Capacity: A Preliminary Look
MIT JOINT PROGRAM REPORT 144
Reilly et al., 2007.
- Computing Tax Rates for Economic Modeling: A Global Dataset Approach
MIT JOINT PROGRAM TECHNICAL NOTE 11
Gurgel et al., 2007.
- Unemployment Effects of Climate Policy
ENVIRONMENTAL SCIENCE AND POLICY 10(7-8): 600-609
Babiker & Eckaus, 2007; also MIT JOINT PROGRAM REPORT 137.
- Climate Change Policy, Market Structure, and Carbon Leakage JOURNAL OF INTERNATIONAL ECONOMICS 65(2): 421-445 Babiker, 2005.
- Simulating the Spatial Distribution of Population and Emissions to 2100 MIT JOINT PROGRAM REPORT 123 Asadoorian, 2005.
- Climate Change Taxes and Energy Efficiency in Japan ENVIRONMENTAL AND RESOURCE ECONOMICS 37(2): 377-410 Kasahara et al., 2007.
- Effects of Air Pollution Control on Climate MIT JOINT PROGRAM REPORT 118 Prinn et al., 2005.
- Economic Benefits of Air Pollution Regulation in the USA: An Integrated Approach MIT JOINT PROGRAM REPORT 113 Yang et al., 2005.
- A Note on Weak Double Dividends TOPICS IN ECONOMIC ANALYSIS & POLICY 4(1): Article 2 Metcalf, Babiker & Reilly, 2004.
- Informing Climate Policy Given Incommensurable Benefits Estimates GLOBAL ENVIRONMENTAL CHANGE 14(3): 287-297 Jacoby, 2004.
- The Cost of Kyoto Protocol Targets: The Case of Japan MIT JOINT PROGRAM REPORT 112 Paltsev et al., 2004.
- The Costs of the Kyoto Protocol in the European Union ENERGY POLICY 31(5): 459-481 Viguier, Babiker & Reilly, 2003.
- Assessing the Impact of Carbon Tax Differentiation in the European Union ENVIRONMENTAL MODELING AND ASSESSMENT 8(3): 187-197 Babiker et al., 2003.
- Tax Distortions and Global Climate Policy J. OF ENVIRONMENTAL ECONOMICS AND MANAGEMENT 46: 269-287 Babiker, Metcalf & Reilly, 2003.
- Russia's Role in the Kyoto Protocol MIT JOINT PROGRAM REPORT 98 Bernard et al., 2003.
- Rethinking The Kyoto Emissions Targets CLIMATIC CHANGE 54(4): 399-414 Babiker & Eckaus, 2002.
- The Evolution of a Climate Regime: Kyoto to Marrakech ENVIRONMENTAL SCIENCE AND POLICY 5(3): 192-206 Babiker et al., 2002.
- MIT EPPA Model Projections and the U.S. Administration's Proposal MIT JOINT PROGRAM TECHNICAL NOTE 3 Reilly, 2002.
- Supplementarity: An Invitation for Monopsony? ENERGY JOURNAL 21(4):29-59 Ellerman & Sue Wing, 2000.
- The Kyoto Protocol and Developing Countries ENERGY POLICY 28: 525-36
Babiker et al., 2000.
- Effects of Differentiating Climate Policy by Sector: A U.S. Example MIT JOINT PROGRAM REPORT 61 Babiker et al., 2000.
- Adjustment Time, Capital Malleability, and Policy Cost ENERGY JOURNAL Special Issue: The Costs of the Kyoto Protocol: A Multi-Model Evaluation, pp. 73-92 Jacoby & Sue Wing, 1999.
- CO2 Emissions Limits: Economic Adjustments and the Distribution of Burdens ENERGY JOURNAL 18(3): 31-58 Jacoby et al., 1997.
- Annex I Differentiation Proposals:
Implications for Welfare, Equity and Policy MIT JOINT PROGRAM REPORT 27 Reiner & Jacoby, 1997.
- Non-CO2 Gases:
- The Role of Non-CO2 Greenhouse Gases in Climate Policy: Analysis Using the MIT IGSM
ENERGY JOURNAL Special Issue #3 Multi-Greenhouse Gas Mitigation and Climate Policy, pp. 503-520 Reilly et al., 2006.
- Stabilization and Global Climate Policy GLOBAL AND PLANETARY CHANGE 42(2-4): 266-272 Sarofim et al., 2005.
- Future Effects of Ozone on Carbon Sequestration and Climate Change Policy Using a Global Biogeochemical Model CLIMATIC CHANGE 73(3): 345-373 Felzer et al., 2005.
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Ozone Effects on Net Primary Production and Carbon Sequestration in the Conterminous United States Using a Biogeochemistry Model TELLUS B 56(3): 230-248 Felzer et al., 2004.
- Modeling Non-CO2 Greenhouse Gas Abatement ENVIRONMENTAL MODELING AND ASSESSMENT 8(3): 175-186 Hyman et al., 2003.
- The Kyoto Protocol and Non-CO2 Greenhouse Gases and Carbon Sinks ENVIRONMENTAL MODELING AND ASSESSMENT 7(4): 217-229 Reilly, Mayer & Harnisch, 2002.
- Linking Local Air Pollution to Global Chemistry and Climate J. OF GEOPHYSICAL RESEARCH 105(D18): 22,869-96 Mayer et al., 2000.
- Multi-gas Assessment of the Kyoto Protocol NATURE 401: 549-555 Reilly et al., 1999.
- Emissions Trading Issues:
- Over-allocation or abatement: A preliminary analysis of the EU Emissions Trading Scheme based on the 2005 emissions data MIT JOINT PROGRAM REPORT 141 Ellerman & Buchner, 2007.
- The Allocation of European Union Allowances: Lessons, Unifying Themes and General Principles,
Editors' concluding chapter in: Allocation In The European Emissions Trading Scheme: Rights, Rents, And Fairness
Cambridge University Press: Cambridge UK, 448 p.
Buchner et al., 2007; also MIT JOINT PROGRAM REPORT 140.
- The Value of Emissions Trading MIT JOINT PROGRAM REPORT 132 Webster et al, 2006.
- An Analysis of the European Emission Trading Scheme MIT JOINT PROGRAM REPORT 127 Reilly & Paltsev, 2005.
- Is International Emissions Trading Always Beneficial? ENERGY JOURNAL 25(2):33-56 Babiker, Reilly & Viguier, 2004.
- The Safety Valve and Climate Policy ENERGY POLICY 32(4): 481-491 Jacoby & Ellerman, 2004.
- Absolute vs. Intensity-Based Emission Caps CLIMATE POLICY 3(2): S7-S20 Ellerman & Sue Wing, 2003.
- Emissions Trading to Reduce Greenhouse Gas Emissions in the United States: The McCain-Lieberman Proposal
MIT JOINT PROGRAM REPORT 97 Paltsev et al., 2003.
- The Effects on Developing Countries of the Kyoto Protocol and CO2 Emissions Trading MIT JOINT PROGRAM REPORT 41 Ellerman et al., 1998.
- Analysis of Post-Kyoto CO2 Emissions Trading Using Marginal Abatement Curves MIT JOINT PROGRAM REPORT 40 Ellerman & Decaux , 1998.
- Emissions Scenarios and Inventories:
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Scenarios of Greenhouse Gas Emissions and Atmospheric Concentrations U.S. CLIMATE CHANGE SCIENCE PROGRAM SYNTHESIS AND ASSESSMENT PRODUCT 2.1A Final Report
Clarke et al., 2007.
- Historical Anthropogenic Emissions Inventories for Greenhouse Gases and Major Criteria Pollutants MIT JOINT PROGAM TECHNICAL NOTE 8 Asadoorian et al., 2006.
- Stabilization and Global Climate Policy GLOBAL AND PLANETARY CHANGE 42(2-4): 266-272 Sarofim et al., 2005.
- Uncertainty Analysis of Climate Change and Policy Response CLIMATIC CHANGE 61(3): 295-320 Webster, et al., 2003.
- Uncertainty in Emissions Projections for Climate Models ATMOSPHERIC ENVIRONMENT 36(22): 3659-3670 Webster et al., 2002.
- Probabilistic Emissions Scenarios MIT JOINT PROGAM TECHNICAL NOTE 2 Reilly et al., 2001.
- Emissions Inventories and Time Trends for Greenhouse Gases and other Pollutants MIT JOINT PROGAM TECHNICAL NOTE 1 Mayer et al., 2000.
- Carbon Sequestration and Emissions Abatement Topics:
- The Future of Coal: Options for a Carbon-Constrained World
AN INTERDISCIPLINARY MIT STUDY
Deutch & Moniz, co-chairs, et al., 2007.
- An Issue of Permanence: Assessing the Effectiveness of Temporary Carbon Storage CLIMATIC CHANGE 59(3): 293-310 Herzog et al., 2003.
- CO2 Abatement by Multi-fueled Electric Utilities: An Analysis Based on Japanese Data MIT JOINT PROGRAM REPORT 76 Ellerman & Tsukada, 2001.
- The Effects of Changing Consumption Patterns on the Costs of Emission Restrictions MIT JOINT PROGRAM REPORT 64 Lahiri et al., 2000.
- What Does Stabilizing Greenhouse Gas Concentrations Mean? in: Critical Issues in the Economics of Climate Change (Flannery et al., editors), International Petroleum Industry Environmental Conservation Association: London Jacoby et al., 1997.
- Economic Assessment of CO2 Capture and Disposal MIT JOINT PROGRAM REPORT 51 Eckaus et al., 1996.
- Technology, Energy, and Related Issues:
- Technology and Technical Change in the MIT EPPA Model
ENERGY ECONOMICS 28(5-6): 610-631, 2006
Jacoby et al., 2006.
- Improving the Refining Sector in EPPA MIT JOINT PROGAM TECHNICAL NOTE 9 Choumert et al., 2006.
- Modeling the Transport Sector: The Role of Existing Fuel Taxes in Climate Policy in: Energy And Environment (R. Loulou et al., editors), Springer, New York, pp. 211-238 Paltsev et al., 2005.
- Technology Detail in a Multi-Sector CGE Model: Transport Under Climate Policy ENERGY ECONOMICS 27(1); 1-24 Schafer & Jacoby, 2005.
- Representing Energy Technologies in Top-down Economic Models Using Bottom-up Information ENERGY ECONOMICS 26(4): 685-707 McFarland, Reilly & Herzog, 2004.
- Disaggregating Household Transport in the MIT-EPPA Model MIT JOINT PROGAM TECHNICAL NOTE 5 Paltsev et al., 2004.
- Analysis of Strategies of Companies under Carbon Constraint: Relationship between Profit Structure of Companies and Carbon/Fuel Price Uncertainty MIT JOINT PROGRAM REPORT 105 Hashimoto, 2004.
- Induced Technical Change and the Cost of Climate Policy MIT JOINT PROGRAM REPORT 102 Sue Wing, 2003.
- Japanese Nuclear Power and the Kyoto Agreement J. OF JAPANESE AND INTERNATIONAL ECONOMIES 14:169-188 Babiker, Reilly & Ellerman, 2000.
- Primary Aluminum Production: Climate
Policy, Emissions and Costs MIT JOINT PROGRAM REPORT 44 Harnisch et al., 1998.
- Economic Modeling Guides:
- Computable General Equilibrium Models and Their Use in Economy-Wide Policy Analysis MIT JOINT PROGAM TECHNICAL NOTE 6 Sue Wing, 2004.
- Moving from Static to Dynamic General Equilibrium Economic Models (Notes for a beginner in MPSGE) MIT JOINT PROGAM TECHNICAL NOTE 4 Paltsev, 2004.
- Publications Describing Other IGSM Components:
