Sectoral emission reduction potentials: comparing bottom-up and top-down approaches

An important question for climate policy making is how much GHG emissions and energy can be saved, in which sectors and at what costs? Traditionally, studies looking at this question are often characterised as either using a Bottom-Up or a Top-Down approach. The differences between these approaches are far from clear-cut. The first approach tends to focus more on available technologies and their characteristics, while the second approach focuses on the processes within the economy as a whole on the basis of observed historic behaviour. The two approaches have also been used in the IPCC fourth assessment report (AR4) (IPCC, 2007) in order to assess the medium- term (2030) sectoral potentials and costs of GHG emission reduction. AR4 finds that at the global level the total emission mitigation potentials and costs of the two approaches are comparable (and presents both results in the summary for policymakers). However, at a regional and sectoral scale, the results could not be readily compared due to different data formats.