Global > Consultancy capability > Recent global analysis
Examples of our global analysis work
Assessment of the Incentives Icluded in the Reduction of Emissions from Deforestation and Forest Degradation (REDD) Programme
European Commission (DG Climate Action)
This study was carried out by a team led by Entec and including Cambridge Econometrics (CE) and IIASA on behalf of the European Commission's Directorate General for Climate Action. Deforestation is responsible for around 20% of global greenhouse gas emissions and is a major cause of biodiversity loss. Reducing deforestation is a climate change mitigation option with the largest impact on emissions in the short term. The United Nations programme 'Reduction of Emissions from Deforestation and forest Degradation' (REDD) may provide incentives for countries to prevent deforestation and degradation.
The objective of the study was to review and improve the most appropriate global forestry models and link these to a general energy/economy model so that the role of REDD in meeting overall emission targets could be assessed. The models were then used to evaluate incentive schemes, providing an understanding of what may happen to the global forest structure in the future. CE's role within the study was to use the E3MG model to provide an assessment of the two-way linkages between REDD and global carbon markets. E3MG was expanded to incorporate marginal abatement cost curves specific to the forestry sector, allowing the model to provide analysis of REDD measures in the context of global emission reduction measures.
Improving Modelling of International Climate Change Policies on a Global Scale
European Commission (DG Climate Action)
This study was carried out by a team led by Entec and including Cambridge Econometrics (CE), PBL and IIASA. Global modelling capability is essential for the preparation of EU climate policies and international negotiations. Particular model elements that are essential in the near future include the coverage of all major global regions, including the largest emitters of greenhouse gases, the improvement of the representation of mitigation policies, and the inclusion of deforestation, afforestation and land use changes. This study had two major objectives. The first was to improve the modelling of international climate change policies through interactions and dissemination of knowledge between EU and international modellers and policy-makers. The second was to assess mitigation policies on a global scale using a range of models. CE's role within the study was to provide the economic assessment using the E3MG model.
Long-Term Climate Policy Goals and its Implications for Adjustment of Mid-Term EU Policies
European Commission (DG Climate Action)
This study was carried out by a team led by Entec and including Cambridge Econometrics (CE) and the National Technical University of Athens (NTUA) on behalf of the Directorate General for Climate Action. The EU currently has legislation in place to reduce its greenhouse gas emissions by 20% by 2020 compared to 1990. However, it is prepared to step this target up to 30% if other external countries make similar commitments. Although these international conditions had not yet been met, it was recognised that there may still be potential economic benefits associated with early climate action in the EU. For example, making emission reductions targets more challenging could result in first-mover advantages for EU companies. The objective of this study was to examine under which conditions the EU could reap such first-mover advantages and which set of policies would be required to promote this. CE's role in the project was to firstly make the necessary developments to the global E3MG model so that it could be used to analyse first-mover advantages, and secondly to apply E3MG to assess the global effects of various policy scenarios.
Assessing the Feasibility of the Implementation of Greenhouse Gas Emissions Trading Systems in Developing Countries European Commission (EuropeAid)
This study was carried out by a team led by Development Solutions and including Ecoprogresso, The Climate Group, Winrock International and Cambridge Econometrics. It was carried out on behalf of EuropeAid in conjunction with DG Climate Action. This study assessed the potential for introducing a greenhouse gas emission trading system (ETS) in China, India and Brazil. Specifically, the project assessed the potential to build on the EU's experience in setting up a trading scheme and identified the main stakeholders to be involved in design and implementation. The assessment covered both macro and microeconomic issues, including technical and legal aspects, and was carried out in consultation with teams in each of the recipient countries. CE's role within the study was to provide an assessment of the macroeconomic, social and environmental impacts of the introduction of an ETS in the three countries using the (global) E3MG model.
Trade Sustainability Impact Assessment Relating to the Negotiations of a Comprehensive Economic and Trade Agreement Between the European Union and Canada
European Commission (DG Trade)
This study was carried out by a team led by Development Solutions and including Cambridge Econometrics on behalf of the European Commission’s Directorate General for Trade. The EU-Canada Comprehensive Economic and Trade Agreement (CETA) aims to liberalise trade in goods and services as well as to set out rules on trade-related issues. The objective of this study was to carry out a Trade Sustainability Impact Assessment (SIA) for the EU-Canada CETA in order to inform the negotiations and decision-making process surrounding the agreement. The Trade SIA assessed how trade and trade-related provisions of the CETA could affect economic, social and environmental issues in the EU and Canada and other relevant countries, such as neighbouring developing countries. CE's role in the project was to estimate the impacts on energy use and greenhouse gas emissions from a negotiated trade deal.
Analysis of Options to Move Beyond 20% Greenhouse Gas Emission Reductions and Assessing the Risk of Carbon Leakage
European Commission (DG Climate Action)
The 20-20-20 targets (a reduction in EU greenhouse gas emissions of at least 20% below 1990 levels, 20% of EU energy consumption to come from renewable resources and a 20% reduction in primary energy use) were set in 2007, to be achieved by 2020. The EU leaders also offered to increase the EU’s emissions reduction to 30%, on condition that other major emitting countries commit to their fair share of reductions under a global climate agreement.
The European Commission wished to produce a Communication presenting the implications of the 20% and 30% targets as seen from today’s perspective. The global E3MG model was used to assess the impacts of stepping up the EU’s ambition level from 20% to 30% as well as to assess the impact the targets would have on the energy-intensive sectors that are exposed to significant risks of carbon leakage. The full communication, published in May 2010, is available here.
Assessing the Outcome of Copenhagen Agreement with Regard to Energy-Intensive Sectors
European Commission (DG Climate Action)
This project was undertaken in the context of the COP15 Copenhagen summit and its aims were: to assess whether (a) an international agreement might lead to high levels of carbon leakage; and (b) whether any carbon leakage could be offset by domestic EU policy, for example ETS allowances. The study was highly quantitative in nature and involved a combination of detailed econometric analysis at a highly disaggregated (NACE 4-digit) level and complex macroeconomic modelling. CE's role within the project was to carry out the econometric analysis and provide modelling expertise through the application of the E3MG model.
The Impact of Oil Prices on the Global Economic Recovery
Foreign and Commonwealth Office
This project considered the relationship between oil demand and the global economy over 2009-12. Carried out in the context of the global slump in early 2009, the key relationships that were examined were (a) how economic growth affects the demand for oil, and (b) how oil prices might affect the global economic recovery. Cambridge Econometrics undertook quantitative analysis using the E3MG model of the global economy to produce a set of scenarios based on different energy prices and investment strategies, with the key outputs being GDP, energy demand, international trade and price impacts. The project was carried out to inform preparations for the G20 London summit in April 2009.
For more information contact
Hector Pollitt
Associate Director, International Modelling