AD-MERGE 2.0: an integrated assessment of the Nexus among energy transitions, climate impacts, and adaptation responses

This paper presents AD-MERGE 2.0, an enhanced integrated assessment model that evaluates reactive (“flow”) and proactive (“stock”) adaptation strategies along with climate mitigation policies. The updated model extends AD-MERGE 1.0 through seven enhancements: (i) including a more recent base year, (ii) increased regional details, (iii) refined energy system modeling, (iv) inclusion of variable renewable energy, (v) direct air carbon capture and storage, (vi) recalibrated damage and adaptation estimates, and (vii) alignment with the latest Shared Socioeconomic Pathway (SSP2, version 3.0). Next, this study assesses five distinct scenarios using the enhanced AD-MERGE 2.0 framework: a Baseline (no mitigation or damage consideration) and two mitigation pathways, a Reference scenario (current policy-driven mitigation and climate damages), and an Announced Pledges scenario (emissions aligned with national commitments). Each of the mitigation scenarios is studied with and without optimal adaptation, an idealized assumption of perfect foresight used to establish theoretical benchmarks. Collective advancements incorporated in the model refine analytical precision in scenario analysis, thus facilitating a more extensive examination of regional heterogeneity, energy system dynamics, technological innovation, and economic vulnerabilities associated with climate impacts. The results underscore critical trade-offs and synergies between adaptation and mitigation strategies, highlighting regional heterogeneity in adaptation needs, residual damages, and mitigation-adaptation interactions, alongside the integration of clean energy technologies.