Market Equilibrium Modeling for Carbon Dioxide Removal (CDR) Markets

The purpose of this doctoral project is to broaden the understanding of the conditions for a massive deployment of emerging CDR technologies in a market environment. Our analysis will be structured as a collection of three projects.- This first part will concentrate on the economics of the CDR markets that are currently envisioned to govern the provision of CDR capabilities. Our ambition is to examine the economics of a large and market-driven deployment of CDR technologies using a spatial and dynamic equilibrium model. That model will be specifically designed to investigate the following research questions: What CDR technologies will be deployed? Where will that deployment occur and with what magnitude? Will that deployment necessitate the implementation of international supply chains? If yes, what will be the magnitude of the associated gains to trade?- The second part aims at examining whether a market-based deployment of CDR can yield the formation of stable international coalitions involving participating nations. The point of departure of our analysis will consist in combining the outcomes of the preceding model with an adapted cooperative game-theoretic framework to examine the conditions for a voluntary participation of these countries.- The last part will adopt a public policy standpoint and concentrate on the policy instruments that can be developed to foster the deployment of CDR. More specifically, our intention is to include the governmental/policymaking scene into the model by proposing an extended two-level approach. Our intention is to determine whether optimal supporting policies can be proposed for CDR technologies.