Impacts of Agricultural Adaptation to Climate Policies

1
Impacts of Agricultural Adaptation to Climate
Policies

• Uwe A. Schneider
• Research Unit Sustainability and Global Change,
  Hamburg University
• Contributors
• Kerstin Jantke, Ivie Ramos, Christine Schleupner,
  Timm Sauer, Chris Llull (Hamburg University),
  Bruce A. McCarl (Texas AM University),
• Petr Havlik, Oskar Franklin, Steffen Fritz,
  Michael Obersteiner (International Institute for
  Applied Systems Analysis), Erwin Schmid
  (University of Natural Resources and Applied Life
  Sciences, Vienna), Juraj Balkovic, Rastislav
  Skalsky (Soil Science and Conservation Research
  institute, Bratislava), Martin Weih (Swedish
  University of Agricultural Sciences ), Andre
  Faaji, Edward Smeets (Utrecht University)

2

1. Questions Challenges
2. Research Tools
3. Policy Analysis
4. Conclusions

3
Land Use
Climate (Environment)
Policies Society
4
Questions

• Mitigation Potential of Climate Policies?
• Land Management Adaptation?
• Commodity Market Impacts?
• Environmental Side Effects?
• Social Side Effects?

5
Challenges

• Heterogeneity (Resources, Technologies)
• Complexity (Mitigation Options, Markets,
  Externalities, Policies)
• Global Scope

6
Land use competition
7
Forest and Agricultural Sector Optimization Model
- FASOM

• Partial Equilibrium, Bottom-Up Model
• Maximizes sum of consumer and producer surplus
• Constrained by resource endowments, technologies,
  policies
• Spatially explicit, discrete dynamic
• Integrates environmental effects
• Programmed in GAMS

8
FASOM History

• US (1993)
• EU (2004)
• Global (2006)

9
FASOM Structure
Limits
Limits
Resources
Land Use Technologies
Products
Markets
Inputs
Demand Functions, Trade
Processing Technologies
Environmental Impacts
Supply Functions
Limits
10
FASOM - Spatial Resolution

• Political regions
• Ownership (forests)
• Farm types
• Farm size

• Soil texture
• Stone content
• Altitude levels
• Slopes
• Soil state

• Many crop and tree species
• Tillage, planting irrigation, fertilization
  harvest regime

11
Homogeneous Response Units

• Altitude
• lt 300 m
• 300-600 m
• 600-1100 m
• gt1100 m

• Slope Class
• 0-3
• 3-6
• 6-10
• 10-15

DE11
DE12

• Texture
• Coarse
• Medium
• Medium-fine
• Fine
• Very fine

DE14

• Soil Depth
• shallow
• medium
• deep

DE13

• Stoniness
• Low content
• Medium content
• High content

12
EUFASOMBiodiversityScope
69 Vertebrate Wetland Species
13
Biodiversity - Spatial Resolution
14
Climate Policy Analysis
15
I US Agricultural Sector Results

• Mainly based on McCarl and Schneider (2001).
  Greenhouse Gas Mitigation in U.S.Agriculture and
  Forestry. SCIENCE 2942481-2481.

16
US Agricultural Mitigation
500
450
400
350
Technical Potential
Competitive Economic Potential
300
Carbon price (Euro/tce)
250
200
150
100
50
0
0
100
200
300
400
500
600
700
800
Greenhouse Gas Emission Mitigation (mmtce)
17
US Mitigation Strategy Mix
500
Afforestation Sink
400
Tillage Carbon Sink
300
Carbon price (/tce)
CH4 N2O Decrease
200
Bioenergy Emission Offsets
100
0
0
20
40
60
80
100
120
140
160
180
200
Emission reduction (mmtce)
18
US Tillage Carbon Sink
500
400
Economic Potential
300
Carbon price (/tce)
Competitive Economic Potential
200
Technical Potential
100
0
0
20
40
60
80
100
120
140
160
Soil carbon sequestration (mmtce)
19
US Afforestation Sink
500
400
Economic Potential
Competitive Economic Potential
300
Carbon price (/tce)
200
Technical Potential
100
0
0
50
100
150
200
250
300
Emission reduction (mmtce)
20
US Bioenergy Emission Offsets
500
Economic Potential
400
Competitive Economic Potential
300
Carbon price (/tce)
200
Technical Potential
100
0
0
50
100
150
200
250
300
350
Emission reduction (mmtce)
21
US Crop Management Impacts

115

110


Irrigation

105

Intensity (Base 100)
100

95

Tillage
90

85

Fertilization

80

75

0
100
200
300
400
500







Carbon equivalent price (/mtce)
22
US Agricultural Markets
220
200
Crop prices
180
160
140
Livestock prices
Fisher index
120
Livestock production
100
80
60
Crop production
Crop exports
40
20
0
50
100
150
200
250
300
Carbon price (/tce)
23
US Welfare Changes
8
6
4
Gross Producer Surplus
2
Net Producer Surplus
0
Billion
-2
Emission Payments
-4
-6
Consumer Surplus
-8
-10
0
20
40
60
80
100
Carbon price (/tce)
24
US Environmental Co-Effects
100
N Subsurface Flow
90
80
N Percolation
Pollution (/acre)
70
Soil Erosion
60
50
P Loss
40
0
50
100
150
200
250
300
Carbon price (/tce)
25
Emission Leakage
160
Non-Annex I crop net exports for agricultural GHG
mitigation policy in
150
140
Fishers Ideal Index
130
USA Only
120
Annex I Countries
110
100
All Countries
90
0
20
40
60
80
100
Carbon price (/tce)
26
II European Agricultural Sector Results

• Unpublished simulations with EUFASOM

27
2010 EU Bioenergy Targets

• 21 Renewable Electricity
• 610 thousand GWh
• 300 million wet tons of biomass
• 5.75 Bio-Fuels

28
Biomass Crop Share for 300 Mt Target
29
Climate Mitigationvs. Biodiversity Protection
30
2010 EU Biodiversity Targets

• 2001 European Council committed to halt the
  decline of biodiversity by 2010 in Europe
• 2002 EU joined about 130 countries in agreeing
  to significantly reduce the rate of biodiversity
  loss by 2010 worldwide
• BUT
• Biodiversity loss still accelerating
• Reservation often ad hoc and uncoordinated
• 2010 only three years away

31
Habitat Needs

• Simulations with the independent 69 species based
  habitat module of EUFASOM show that 10, 20, 30,
  40 viable populations for each species require
  22, 35, 42, and 61 million hectares,
  respectively, in specific locations

32
Wetland Area Share for a 40 Mha Target
33
Biomass Crop Share for 300 Mt Target
34
EU25 Bioenergy Potentials
600
Wetland Requirement 40 Mha
500
400
Marginal Biomass Costs in Euro/ton
300
30 Mha
200
10 Mha
100
0
0
50
100
150
200
250
300
350
400
European Biomass Production in million wet tons
35
Cereal Straw Removal
3
2
1
Yields
years
0
10
20
30
40
50
percentage change
-1
-2
-3
-4
Soil Organic Carbon
-5
Unpublished EPIC Simulations by E. Schmid
36
Conclusions

• Low mitigation targets, low marginal mitigation
  costs, more extensive agriculture, water and soil
  quality benefits
• High mitigation targets, high marginal cost, more
  intensive agriculture, more pressure on food and
  biodiversity
• Simultaneous biodiversity policies increase
  agricultural mitigation cost
• Integrated analysis important (climate, soil,
  water, biodiversity, fuel, food) to prevent
  todays solution becoming the problem of tomorrow

37
Integrated Analysis in CCTAME2008-2011
38
Thank you.