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Climate policies as a hedge against the uncertainty on future oil supply

Abstract : Despite the inextricable link between oil scarcity and climate change, the interplay between these two issues is paradoxically an underworked area. This article uses a global energy-economy model to address the link between future oil supply and climate change and assesses in a common framework both the costs of climate policies and oil scarcity. It shows that, in the context of a limited and uncertain amount of ultimately recoverable oil resources, climate policies reduce the world vulnerability to peak oil. Climate policies, therefore, appear as a hedging strategy against the uncertainty on oil resources, in addition to their main aim of avoiding dangerous climate change. This co-benefit is estimated at the net present value of US$11,500 billion. Eventually, reducing the risk of future economic losses due to oil scarcity may appear as a significant side-benefit of climate policies to many decision-makers.
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Submitted on : Monday, September 30, 2013 - 1:45:32 PM
Last modification on : Friday, August 5, 2022 - 2:38:11 PM
Long-term archiving on: : Tuesday, December 31, 2013 - 4:23:58 AM


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  • HAL Id : hal-00866449, version 1


Julie Rozenberg, Stéphane Hallegatte, Adrien Vogt-Schilb, Olivier Sassi, Céline Guivarch, et al.. Climate policies as a hedge against the uncertainty on future oil supply. 2010. ⟨hal-00866449⟩



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