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ARFIMA Reference Forecasts for Worldwide CO2 Emissions and the National Dimension of the Policy Efforts to Meet IPCC Targets

Belbute, J., A.M. Pereira (2019), ARFIMA Reference Forecasts for Worldwide CO2 Emissions and the National Dimension of the Policy Efforts to Meet IPCC Targets , CEFAGE-UE Working Paper 2019/07.
Abstract:

We use an ARFIMA approach to develop reference scenario projections for CO2 emissions worldwide and for seven different regions. Our objective is to determine the magnitude of the policy efforts necessary to achieve the IPCC emissions reductions goals. For worldwide emissions, the aggregate policy effort required to achieve the 2050 goals is equivalent to 97.4% of 2010 emissions. This policy effort is frontloaded as about 60% of such efforts would have to occur by 2030. In order to achieve the IPCC target the policy efforts in the cases of the USA, EU(28), Russia, and Japan - which account for 32% of worldwide emissions, are lower and less frontloaded than the IPCC goals themselves. In the case of China, India and the ROW, which account for 68% of worldwide emissions, additional policy efforts are necessary to achieve reductions in emissions of 105.0%, 156.0% and 111.4%, of the 2010 levels, respectively. In the case of India, policy efforts are not only rather severe but also rather dramatically frontloaded, as about 74% of the policy efforts would have to occur by 2030. Our results suggest that the policies toward decarbonization must consider the specific regional characteristics of emissions. Given the differences in the inertia of emissions in the different regions a one-size fits all approach is not the best approach.

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Keywords: CO2 emissions, IPCC emission targets, long memory, ARFIMA