The Interaction of
Climate Mitigation and
Universal Energy
Access Policies
Narasimha D. Rao
(with Shonali Pachauri & Keywan Riahi)
Analytical Challenges
• Economic (income) and spatial
(urban/rural) heterogeneities
– Differential impacts
• Addressed with a household fuel choice
model, calibrated to household surveys
Scenarios (Part 1): Climate Policies
Carbon Policies
Name 2020 Carbon Price
NNP: $0/T CO2 eq
C10 $10/T CO2 eq
C20 $20/T CO2 eq
C30 $30/T CO2 eq
C40 $40/T CO2 eq0,0
0,5
1,0
1,5
2,0
2,5
3,0
3,5
4,0
4,5
2000 2020 2040 2060 2080 2100
Glo
bal
Tem
per
atu
re In
crea
se (
°C)
NNP
C10
C20
C30
C40
Results: Solid Fuel Use and a carbon
tax
0
0,2
0,4
0,6
0,8
1
1,2
1,4
2010 2020 2030 2040 2050
Solid
Fu
els
Use
rs (
Bill
ion
s)
C40
C30
C20
C10
NNP
• 433 Million Additional
Solid Fuel Users
• Equivalent to no
change from 2010
• C40 scenario has larger impact
in 2050 than C10
• 336 Million Additional
Solid Fuel Users
• Equivalent to access
uptake from 15 years
of GDP growth
• No effect of the
carbon tax on the
poorest group
Results: Distributional Effects of Climate Policy
2040 2050203020202010R2 most effected group:
• 56% of “additional” solid
fuel users in 2030
• 67% of additional solid
fuel users in 2050
2° carbon tax causes
10% of U2 to remain
reliant on solid fuels
through 2050
Scenarios (Part 2): Access Policies
• Two policy mechanisms for increasing LPG
affordability:
– Stove subsidy (0% - 100%)
– Fuel subsidy (0% - 75%)
• 1,680 policy scenarios
– 334 combinations of stove and fuel subsidy
for each carbon tax scenario
Results: with carbon tax (C30), 2030
s100f65
2° climate policy decreases access achievement of s100f0 by 18%
Cost to achieve 95%
access increases:
$11.5 billion per year
Cost to achieve 100%
access increases:
$14.9 billion per year
Results: Distributional effects, 2030
0
0,1
0,2
0,3
0,4
0,5
0,6
0,7
0,8
0,9
1
NNP C30 NNP C30 NNP C30 NNP C30
Po
pu
lati
on
Usi
ng
Mo
de
rn F
ue
ls (
Bill
)
s100f50
s100f25
s100f0
s50f0
s0f0
R2 U1 U2R1
R1 requires substantial
stove and fuel subsidy
regardless of climate policy
Fuel subsidies not
needed by R2 in NNP,
but needed in C30
U2 needs partial stove
subsidy to achieve
complete access in C30
Key Conclusions
• Stringent GHG mitigation can (significantly)
reduce the uptake of modern cooking fuels –
• Impact can be mediated (substantially) by ‘pro-
poor’ policies
• Policy costs to improve access vary more with
access policy mechanism choice than with the
stringency of climate mitigation