How economic and social actors can champion CO2 phase-out The INNOPATHS Approach Paul Ekins University College London

POLICY CONFERENCE

Key Information Research Stream: SC5– Climate Action, Environment, Resource Efficiency and Raw Materials Timeframe: 1st December 2016 – 30th November 2020 Budget: ~ €6 million Partners: 15 partners across 9 countries (8 EU, plus Switzerland) Contacts: www.innopaths.eu; Twitter @innopathsEU; Email: k.dhillon@ucl.ac.uk

Objectives of the Project The overall objective of INNOPATHS is to work with key economic and societal actors to generate new enhanced low-carbon pathways for the European Union, taking full account of the global context. To meet this objective, it has five concrete aims: Understanding the challenges of decarbonisation and the innovation needed to address them Presenting a detailed assessment of low-carbon technologies, their uncertainties, future prospects and system characteristics Proposing policy and innovation system reforms that will help the EU and Member States meet their greenhouse gas emission reduction targets Creating new, co-designed deep decarbonisation pathways with novel representation of policy and innovation process for low-carbon technology development Making clear the social, economic and environmental dimensions of the low-carbon transition and how they can be managed

Questions How can economic and social actors champion CO2 phase-out? Can deep decarbonisation pathways be reconciled with the political objectives of reinvigorating European industries and strengthening economic competitiveness? What does science have to say about the risks and opportunities related to innovation, deployment, financing or public acceptance?

How can economic and social actors champion CO2 phase-out? Understanding the challenges of decarbonisation and the innovation needed to address them WP1: Examine the socio-economic dimensions of the low carbon transition of existing narratives and scenarios Inc. distributional consequences, ethical issues, impacts on labour markets and competitiveness Identification of ‘losers’ from the transition (e.g. carbon-intensive industries/employers), and policies to ameliorate such impacts, through case studies WP2: Map the innovation systems (key actors, institutions, innovation strategies and policies, drivers and inhibitors of innovation) for six sectors (power generation, industry, ICT, buildings, transport and agriculture), across four Member States (Italy, the UK, Poland and Germany) – plus the EU level WP3: ‘Co-design’ low-carbon scenario narratives through stakeholder engagement, using an online ‘Decarbonisation Simulator’

Can deep decarbonisation pathways be reconciled with the political objectives of reinvigorating European industries and strengthening economic competitiveness? Yes, through ‘mission-driven’ innovation, industrial strategy and supportive government policy WP3: Evaluate different co-designed policy packages to achieve the co-designed narrative scenarios WP4: Assess the implications: For the macroeconomy (e.g. employment, GDP growth, industrial competitiveness), Social/distributional implications of the scenarios by income class and Member State (with GEM-E3-RTD) Governance options to maximise policy effectiveness (e.g. whether policy instruments or elements thereof may be best applied at the EU, national or city level) Implications for air pollution, energy security, resources, materials, agriculture and land Options for innovative financial instruments and regulation to encourage investment

What does science have to say about the risks and opportunities related to innovation, deployment, financing or public acceptance? Innovation: public/private; ‘mission-driven’; systemic change Deployment: consistency of public policy; market creation (green public procurement) Financing: consistency of public policy; bankable projects; carbon pricing; regulations (boilers, home energy efficiency); WP2: the role of financial risk-sharing instruments and investment ‘selection criteria’ Public acceptance: public support in principle; consumers at the centre (digital appliances, smart grid, flexibility, cost saving)

Online Tools Technology Assessment Matrix Policy Assessment Framework Graphical representations of underlying data on different parameters regarding energy-related technologies, with the user able to select variables to view Projected costs and uncertainty range to 2030-2050 will also be provided Function for cross-country and cross-technology comparisons where data is available Policy Assessment Framework The Tool will allow users to select policy instruments or policy mixes to examine their effectiveness and historic impacts (e.g. competitiveness, socio-economic), along with confidence levels & uncertainties Focus will be on EU and Member States, but evidence from third countries will be included Interactive Decarbonisation Simulator The Tool will allow Co-Designers to examine different decarbonisation strategies to understand which options and measures have different degrees of effect, and where trade-offs and bottlenecks may lay Underlying data will be aggregated from existing PRIMES model runs, and not result directly from INNOPATHS-generated data Low-Carbon Pathways Platform The tool will allow users to assess the various detailed implications of the low-carbon pathways developed by the project, using data generated across the WPs The tool will be a primary output of the project, with its presence to be promoted primarily within policy making, industry and NGO circles

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