Tapasco Economic analysis of mitigation alternatives july 2012
1. Eco-Efficient Agriculture for the Poor
WWW.ciat.cgiar.org
Jeimar Tapasco
Andy Jarvis
Lini Wollenberg
Economic analysis for mitigation alternatives - limits of MACCs
Expert Workshop on NAMAs: national mitigation planning and implementation in agriculture.
Rome, 16-17 July 2012. CCAFS and FAO.
3. Eco-Efficient Agriculture for the Poor
Source: World Bank (2010)
MEXICO
BRASIL
Source: World Bank (2010)
USA
Sorce: Lutsey (2008)
UK Agriculture
Source: OECD (2010)
4. Eco-Efficient Agriculture for the Poor
MAC Curve for Colombia
-Energy
- Transport
- Agriculture, Forestry and Other Land Use
World Bank and DNP
5. Eco-Efficient Agriculture for the Poor
Agriculture
Agroforestry
Forestry
Annual
Perrennial
Livestock
Tree + Crops or/and Livestock
Natural
Plantation
Efficient Fertilization (Case Study: Rice)
Oil Palm
Silvopastoral Systems
Commercial Forestry Plantations
Pasture Improvement
Rubber Plantations
REDD+
Conversion of Pastures to Fruit Tree Plantations
Crops in Histosols
Cacao
Nutritional Complements
Low-Carbon Agricultural Practices
Ecological Restoration
6. Eco-Efficient Agriculture for the Poor
Intervention alternative
Abatement potential (thousands of tCO2eq/year)
Potential area evaluated (ha)
Cost- effectiveness
(US$/tCO2eq)
Min Max
Commercial Forestry Plantations
44,037
4,000,000
-4,4
-2,7
Intensive Silvopastoral (ISS) Projects
43.819
3.739.109
-49
0.6
Avoided Deforestation (REDD Projects)
65,874
2,250,000
-0.2
-0.2
Conversion of Pastures to Fruit Production
1,938
359,320
-188
-25
Rubber Plantations
1,786
260,000
-1,05
-0,67
Efficient Use of Fertilizers
38
170,000
-267
145
Pasture Improvement
54
51,487
-103
-62
7. Eco-Efficient Agriculture for the Poor
MAC Curve - Aggregate
(270)
(170)
(70)
30
130
-
10,000
20,000
30,000
40,000
MAC: US$/tCO2
Thousand tonnes of carbon saved/year
Rice Casanare (Irrigation)
Rice Valledupar
Mango Huila Small
Mango Huila Large
Avoca.Tolima Medium
Avoca. Tolima Large
Mango Cundinamarca Small
Avoca. Huila Medium
Avoca. Huila Large
Mango Cundinamarca Large
Rice Tolima
Improve Pasture Meta
Rice Casanare
Mango Cundinamarca Medium
Mango Boyaca Small
Improve Pasture Casanare
Mango Tolima Small
Rice Meta
Improve Pasture Arauca
Mango Tolima Large
Avoca. Risaralda Large
Avoca. Antioquia Medium
Avoca. Quindio Large
SSPi Bajo-Cauca (Antioquia)
Avoca. Risaralda Small
Avoca. Quindio Small
Avoca. Caldas Large
Mango Boyaca Large
Avoca. Antioquia Large
Avoca. Risaralda Medium
Avoca. Caldas Small
Avoca. Quindio Medium
Mango Antioquia Large
Avoca. Antioquia Small
Mango Boyaca Medium
Mango Antioquia Small
Avoca. Caldas Medium
Rice Guaranda y Nechi
SSPi Eastern -Antioquia
rest of the country (CIPAV)
SSPi Córdoba
SSPi Atlantico
SSPi Sucre
SSPi Uraba-Antioquia
SSPi Northeast - Antioquia
Rice Jamundi
Rice Cucuta
9. Eco-Efficient Agriculture for the Poor
Overview of selected key limitations of the cost/supply curve method*
• Negative costs (Not all cots were included)
• Strong focus on costs as selection criteria (there are other criteria)
• It does not include environmental and social benefit and costs
• Economic and technological uncertainty inherent to predicting the future
• Strong level of aggregation of the databases used
• High sensitivity relative to baseline assumptions (future)
• Ignoring interdependencies between measures
• High sensitivity to (uncertain) emission factor assumptions
*Fischedick et al. 2011.
10. Eco-Efficient Agriculture for the Poor
MAC Curve global GHG beyond business as usual 2030
Source: McKinsey & Company (2010)
12. Eco-Efficient Agriculture for the Poor
• There are a large number of potential mitigation options that could be implemented at the national level, with highly varying degrees of emissions reductions, and associated costs for implementation
Conclusions
13. Eco-Efficient Agriculture for the Poor
.
Clear goals should be set with any emissions reduction plan or strategy, and these goals can then be used as criterion for prioritization
14. Eco-Efficient Agriculture for the Poor
MAC curves are a useful input to evaluating priority interventions, but…….should be interpreted with caution.
Incorrect use of the MAC curve for selecting interventions could lead to failure to prioritize the most appropriate interventions.
22. Eco-Efficient Agriculture for the Poor
Figure 1 - Effect of the emission reduction amount on the cost- effectiveness value.
Figure 1a - CEA value against different levels of emission reduction and a constant cost.
Figure 1b - Representation of a cost-effectiveness curve
23. Eco-Efficient Agriculture for the Poor
Figure 2 - Effect of the emission reduction amount on the cost- effectiveness value.
Figure 2a - CEA value against different levels of emission reduction and a constant cost.
Figure 1b - Representation of a cost-effectiveness curve