ESTIMATING THE POTENTIAL CO2 EMISSION REDUCTION IN 97 CONTRACTING COUNTRIES OF THE PARIS AGREEMENT

Abstract

“The common but differentiated responsibilities” requires that participating countries in the Paris Agreement need to clarify their national emission reduction priorities and develop practical and feasible plans based on their local conditions. This paper aims to estimate the CO2 emission efficiency and the potential emission reduction of the Paris Agreement contracting countries and identify the key influencing factors of CO2 emission efficiency for the period of 1991–2014. A nonradial directional distance function, the metafrontier approach, and the bootstrapped truncated regression model are used. The following are the main conclusions: (1) China makes the highest annual potential CO2 emission reduction of 2133.13 billion tons. (2) The technology gap appears to be a major contributor to the potential CO2 emission reductions in the low income group (82.87%) and the lower–middle income group (66.01%), and thus these economies should pursue technological innovation to improve carbon emission efficiency; the potential CO2 emission reductions in other groups are mainly the result of management inefficiency (with 57.52% and 78.38% of potential emission reductions by the upper–middle income and high income countries coming from management inefficiency). Therefore, some countries in the specific income group exhibit different emission reduction focus. (3) According to a regression analysis on the CO2 emission efficiency contributing factors, the progress of total factor productivity and improvement of management level can improve the CO2 emission efficiency. This study might be the first attempt to decompose the potential CO2 emission reduction of these countries and provides each country with targeted, effective emission reduction priorities.