An Actor-Oriented Approach to Evaluate Climate Policies with Regard to Resource Intensive Industries

Abstract

Metal production is responsible for a large part of greenhouse gas (GHG) emissions in Germany. While some political stakeholders call for a more restrictive climate policy to force further reductions of GHG emissions, the exceptions made for the metal industry increased so far to guarantee its global competitiveness. The question rises how a more restrictive climate policy would affect industrial GHG emissions and the profitability. To estimate the impact of political instruments the actor-oriented approach presented focuses on the simulation of plant-specific investment decisions. First, a detailed database of the internal material and energy flows of all relevant iron, steel and aluminium producing plants together with the best available techniques (BAT) for GHG emission reduction is developed. In the subsequent simulation, the plants, modelled as actors, decide on the implementation of these techniques dependent on the political conditions which are varied in scenarios. The results show, that there are only minor GHG emission reduction potentials due to already implemented high efficiency standards. Nevertheless, more restrictive climate policies can lead to significant cost increases influencing global competitiveness.