Increased energy use for adaptation significantly impacts mitigation pathways

The Intergovernmental Panel on Climate Change (IPCC) highlights the risk of maladaptive responses from adaptation actions focused on short-term benefits. Current Illustrative Mitigation Pathways (IMPs) do not account for adaptation costs. This research addresses this gap by analyzing how adaptation actions directly impacting final energy use feed back into the energy system and the environment. Adaptation actions, such as increased water pumping, desalination, air conditioning, and adjustments to industrial processes due to extreme temperatures, are often energy-intensive. While some changes, like reduced space heating, might decrease energy demand, increased cooling needs and impacts on labor productivity often outweigh these reductions. These energy-intensive adaptations counteract efforts towards low-energy-demand development pathways needed for ambitious climate mitigation goals. Although previous studies have used econometric simulations or Computable General Equilibrium (CGE) models to assess some aspects, a comprehensive macroeconomic assessment integrating adaptation-energy feedback into global mitigation pathways is lacking. This study aims to fill this gap by analyzing the global and regional implications of this feedback.

Existing literature documents the sensitivity of energy demand to weather fluctuations. However, most energy scenarios and mitigation pathways neglect the adaptation-energy feedback. Previous global-scale contributions have relied on econometric simulations, providing partial equilibrium projections without fully capturing price-induced substitution and income effects. While CGE models suggest the global market can absorb adaptation costs, a holistic understanding of the energy system implications under ambitious mitigation policies is needed. This study builds upon these existing works by using an integrated assessment model (IAM) to provide a comprehensive assessment of the macroeconomic implications, including price-induced substitution, income effects, and technical change adjustments.

This study integrates an adaptation-energy feedback loop into the World Induced Technical Change Hybrid model (WITCH), a process-detailed IAM that incorporates macroeconomic, energy system, climate system, and air pollution modules. The integration proceeds in three steps: (1) empirical estimation of the relationship between country-level temperature (including extreme temperature indicators – ETIs) and energy demand; (2) modeling the relationship between ETI changes and demand for electricity, gas, and oil across sectors (residential, commercial, industrial); (3) incorporating changes in energy demand into the model’s production tree, endogenously affecting the energy sector’s supply-side adjustments. The model assesses the impact of this feedback on mitigation policies (carbon pricing, emission allocation), air pollution, and energy system costs under various scenarios: a current policy scenario and two climate policy scenarios targeting 2.5°C and well-below 2°C warming. The Shared Socioeconomic Pathway SSP2 is primarily used, with sensitivity analyses across other SSPs. The WITCH model (version 5.0) is used, incorporating the MAGICC climate module and the FASST air pollution module. The analysis utilizes extreme temperature indicators (ETIs) to capture the nonlinearity of energy demand response at extreme temperatures, unlike studies that used HDDs and CDDs, which may lead to underestimation.

The results show that adapting to climate change using past energy habits will significantly increase global energy demand. By 2100, under the current policy scenario, global electricity demand increases by 18% (75 EJ), and fuel demand increases by 2.5% (10 EJ). This leads to substantial increases in new fossil fuel-based power generation capacity (960 GW of gas, 360 GW of oil, 300 GW of coal cumulatively by 2050). The carbon price needed to meet climate targets increases by 5-30% depending on the scenario. Regional variations are significant, with Africa and the Middle East experiencing the largest relative increases in energy demand for adaptation. Ambitious mitigation policies significantly reduce the energy needs for adaptation and the associated new fossil fuel capacity. While the share of fossil fuels in the total power mix does not change dramatically with the inclusion of adaptation energy feedback, additional GHG emissions from adaptation (350 GtCO₂eq by 2100 in the current policy scenario) and air pollutants (especially NOx, CO, and SO2) are substantial. The energy system costs increase in all scenarios due to adaptation, but ambitious mitigation scenarios reduce these increases because of lower adaptation needs. Even in the well-below-2°C scenario, net gains in power system costs are possible compared to the current policy. The costs of adaptation are not evenly distributed regionally. The additional costs are higher in the US and MENA region compared to the world average, though the relative impact is smaller in the US (0.4% of regional GDP) than in MENA (0.7%).

This study demonstrates the crucial role of integrating climate change impacts and adaptation into energy scenarios. Ignoring the energy system costs of adaptation leads to an overestimation of the costs of ambitious mitigation policies. The findings reinforce the need to consider the interdependencies between mitigation and adaptation in policy design. The increase in global energy demand, particularly in buildings and industry, highlights the limitations of IAMs that only consider income and population drivers and underscores the importance of incorporating climatic conditions. The substantial additional energy needs in regions like South-East Asia and Africa emphasize the risk of exacerbating existing vulnerabilities. The significant role of industrial energy demand in adaptation suggests a need for further research into this sector. The study also highlights the potential negative impact on air quality and associated health costs due to increased fossil fuel use for adaptation.

This research underscores the critical importance of integrating adaptation-energy feedback into mitigation pathways. Ignoring this feedback leads to overestimation of the costs of ambitious mitigation and underestimation of their benefits. While ambitious mitigation policies significantly reduce the energy requirements for adaptation, even in well-below-2°C scenarios, additional energy demand remains. Further research should explore other adaptation mechanisms (water supply, transportation, etc.), refine the model's representation of energy demand response to temperature variations, incorporate adaptation benefits, and analyze finer spatial and temporal scales to better assess the impacts on peak electricity demand and the associated costs.

The model’s representation of energy demand response to temperature might overestimate climate change impacts by assuming negligible response to moderate temperature changes. Behavioral changes, technological advancements (e.g., more efficient buildings), and planned adaptation strategies could reduce energy needs. Conversely, using region-specific thresholds or considering humidity's effect on thermal discomfort could amplify projected energy demand, particularly in tropical regions. The study's aggregation level poses challenges to identifying precise health impacts of air pollution increases. The model also doesn't explicitly account for the vulnerability of power systems themselves to climate change.