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GTAP Resource #3849

"Why Energy Prices will be a Key Driver of Global Land use in the 21st Century"
by Steinbuks, Jevgenijs and Thomas Hertel

Most research to date has focused on quantifying uncertainty effects of three major drivers affecting competition for global land use. The first of these effects is the uncertainty in energy and climate policies affecting competition between food and biofuels. The second of these effects is the uncertainty of climate change itself affecting yields in agriculture and forestry sectors. The third of these effects is the uncertainty in technological change affecting the efficiency of food, bioenergy and timber production. One source of uncertainty that has received relatively less attention in the literature is the uncertainty in fossil fuel prices. Petroleum and natural gas prices are key factor affecting competitiveness of biofuels and prices of nitrogen fertilizers. Rising energy prices thus put significant pressure on global land supply and greenhouse gas emissions from terrestrial systems.

The goal of this study is to assess and compare the effects of these four core uncertainties on the optimal profile for global land use and land based GHG emissions. The model that we develop integrates distinct strands of agronomic, biophysical and economic literature into a single, intertemporally consistent, analytical framework, at global scale. Our analysis is based on a dynamic long-run, forward-looking partial equilibrium framework, in which the societal objective function places value on production of services from food, liquid fuels (including first- and second- generation biofuels), timber, forest carbon and biodiversity. The effect of uncertainty in energy prices appears considerably larger than the uncertainty in the three, more traditional sources of uncertainty in existing analyses of global land use which have largely focused on energy and climate mitigation policies as well as climate impacts.

Resource Details (Export Citation) GTAP Keywords
Category: 2012 Conference Paper
Status: Published
By/In: Presented at the 15th Annual Conference on Global Economic Analysis, Geneva, Switzerland
Date: 2012
Created: Steinbuks, J. (4/27/2012)
Updated: Steinbuks, J. (6/21/2012)
Visits: 2,207
- Climate change policy
- Renewable energy
- Dynamic modeling

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