Managing Allowance Prices in a CapandTrade Program
Author :
Publisher : DIANE Publishing
Page : 32 pages
File Size : 18,55 MB
Release :
Category :
ISBN : 1437942555
Author :
Publisher : DIANE Publishing
Page : 32 pages
File Size : 18,55 MB
Release :
Category :
ISBN : 1437942555
Author : Terry Dinan
Publisher :
Page : 36 pages
File Size : 14,94 MB
Release : 2010
Category : Air quality management
ISBN :
Scientists generally conclude that rising concentrations of greenhouse gases are warming the Earth's climate. Concern about the damage that might result has led policymakers and analysts to consider policies designed to restrict emissions of those gases. One type of policy, a cap-and-trade program, could minimize the cost of achieving a limit, or cap, on emissions by allowing market forces to determine where, how, and to some extent when the cuts in emissions necessary to achieve the cap would be made. This Congressional Budget Office (CBO) study--prepared at the request of the Chairman of the Senate Committee on Energy and Natural Resources--examines the potential effects of features that would help manage allowance prices, and thus the cost of complying with a cap-and-trade program, by altering the number of allowances available to firms at various prices--Preface.
Author : Terry Dinan
Publisher :
Page : 19 pages
File Size : 46,40 MB
Release : 2010
Category : Air quality management
ISBN :
"Scientists generally conclude that rising concentrations of greenhouse gases are warming the Earth's climate. Concern about the damage that might result has led policymakers and analysts to consider policies designed to restrict emissions of those gases. One type of policy, a cap-and-trade program, could minimize the cost of achieving a limit, or cap, on emissions by allowing market forces to determine where, how, and to some extent when the cuts in emissions necessary to achieve the cap would be made. (Other options include taxes on emissions and regulatory standards to reduce emissions, or a combination of the various approaches.) A cap-and-trade program would establish increasingly stringent annual limits on greenhouse gas emissions over the course of several decades. The government would distribute rights to emit such gases (allowances) by either selling them, possibly in an auction, or giving them away. Firms would be allowed to trade the allowances after they had been distributed and to shift them over time to some degree by 'banking' unused allowances for future use or by 'borrowing' allowances allocated to future years. The price of allowances would rise to the level necessary to ensure that the limit on cumulative emissions over the life of the policy (implied by the annual caps) was met. That price level would depend crucially on a variety of factors, including the growth of the economy and the development of new technologies to reduce emissions. Because policymakers cannot know in advance how high or low prices will be in any given year, they might consider adding features to the design of a cap-and-trade program that would limit the range of potential allowance prices. This Congressional Budget Office (CBO) study--prepared at the request of the Chairman of the Senate Committee on Energy and Natural Resources--examines the potential effects of features that would help manage allowance prices, and thus the cost of complying with a cap-and-trade program, by altering the number of allowances available to firms at various prices. In keeping with CBO's mandate to provide objective, impartial analysis, the report contains no recommendations." --Preface.
Author : Michael P. Bergmann
Publisher : Nova Science Publishers
Page : 0 pages
File Size : 14,48 MB
Release : 2011
Category : Emissions trading
ISBN : 9781612095899
Scientists generally conclude that rising concentrations of greenhouse gases are warming the Earth's climate. Concern about the damage that might result has led policymakers and analysts to consider policies designed to restrict emissions of those gases. One type of policy, a cap-and-trade program, could minimise the cost of achieving a limit, or cap, on emissions by allowing market forces to determine where, how, and to some extent when the cuts in emissions necessary to achieve the cap would be made. This new book examines the potential effects of features that would help manage allowance prices, and thus the cost of complying with a cap-and-trade program.
Author : Hans-Werner Sinn
Publisher : MIT Press
Page : 287 pages
File Size : 11,67 MB
Release : 2012-02-03
Category : Business & Economics
ISBN : 0262300583
A leading economist develops a supply-side approach to fighting climate change that encourages resource owners to leave more of their fossil carbon underground. The Earth is getting warmer. Yet, as Hans-Werner Sinn points out in this provocative book, the dominant policy approach—which aims to curb consumption of fossil energy—has been ineffective. Despite policy makers' efforts to promote alternative energy, impose emission controls on cars, and enforce tough energy-efficiency standards for buildings, the relentlessly rising curve of CO2 output does not show the slightest downward turn. Some proposed solutions are downright harmful: cultivating crops to make biofuels not only contributes to global warming but also uses resources that should be devoted to feeding the world's hungry. In The Green Paradox, Sinn proposes a new, more pragmatic approach based not on regulating the demand for fossil fuels but on controlling the supply. The owners of carbon resources, Sinn explains, are pre-empting future regulation by accelerating the production of fossil energy while they can. This is the “Green Paradox”: expected future reduction in carbon consumption has the effect of accelerating climate change. Sinn suggests a supply-side solution: inducing the owners of carbon resources to leave more of their wealth underground. He proposes the swift introduction of a “Super-Kyoto” system—gathering all consumer countries into a cartel by means of a worldwide, coordinated cap-and-trade system supported by the levying of source taxes on capital income—to spoil the resource owners' appetite for financial assets. Only if we can shift our focus from local demand to worldwide supply policies for reducing carbon emissions, Sinn argues, will we have a chance of staving off climate disaster.
Author :
Publisher :
Page : 26 pages
File Size : 39,28 MB
Release : 2009
Category : Carbon dioxide mitigation
ISBN :
This paper considers the distributional effects of cap-and-trade across different sets of people, including consumers, shareholders, household income groups, and geographic regions, and it explores the role of policy design in determining those effects. The paper describes how the incidence of the program depends on how market forces transmit the costs of emissions abatement through the economy and how the program can create large transfers from one group to another, especially through the way the government doles out allowances. Finally, it explains how the allocation of allowances can lower or raise the overall costs to the economy by reducing other economic distortions or by inducing higher-cost abatement. -- Intro (p.1).
Author : Canada. Environment Canada
Publisher : Canadian Government Publishing
Page : 80 pages
File Size : 27,41 MB
Release : 2005
Category : Business & Economics
ISBN :
"This guidebook is intended as a reference for policymakers and regulators considering cap and trade as a policy tool to control pollution. It is intended to be sufficiently generic to apply to various pollutants and environmental concerns; however, it emphasizes cap and trade to control emissions produced from stationary source combustion."--Page 1-1, Introduction.
Author : Robert W. Hahn
Publisher :
Page : 31 pages
File Size : 26,20 MB
Release : 2010
Category : Economics
ISBN :
We examine an implication of the 'Coase Theorem' which has had an important impact both on environmental economics and on public policy in the environmental domain. Under certain conditions, the market equilibrium in a cap-and-trade system will be cost-effective and independent of the initial allocation of tradable rights. That is, the overall cost of achieving a given aggregate emission reduction will be minimized, and the final allocation of permits will be independent of the initial allocation. We call this the independence property. This property is very important because it allows equity and efficiency concerns to be separated in a relatively straightforward manner. In particular, the property means that the government can establish the overall pollution-reduction goal for a cap-and-trade system by setting the cap, and leave it up to the legislature - such as the U.S. Congress - to construct a constituency in support of the program by allocating the allowances to various interests without affecting either the environmental performance of the system or its aggregate social costs. Our primary objective in this paper is to examine the conditions under which the independence property is likely to hold - both in theory and in practice. A number of factors can call the independence property into question theoretically, including market power, transaction costs, non-cost-minimizing behavior, and conditional allowance allocations. We find that, in practice, there is support for the independence property in some, but not all cap-and-trade applications -- National Bureau of Economic Research web site.
Author : Marika Tatsutani
Publisher :
Page : 26 pages
File Size : 44,80 MB
Release : 2013
Category :
ISBN :
Cost containment has emerged as a major point of contention in the current congressional debate about designing a cap-and-trade program to limit future U.S. greenhouse gas (GHG) emissions. This paper reviews basic concepts and policy options for cost management, drawing on a March 2008 workshop sponsored by Resources for the Future (RFF), the National Commission on Energy Policy, and Duke University's Nicholas Institute for Environmental Policy Solutions. The different sources and temporal dimensions of cost uncertainty are explored, along with possible mechanisms for addressing short- and long-term cost concerns, including banking and borrowing, emissions offsets, a price cap (or safety valve), quantity-limited allowance reserve, and the concept of an oversight entity for GHG allowance markets modeled on the Federal Reserve. Recognizing that the inherent trade-off between environmental certainty and cost certainty has no perfect solution, the paper nonetheless concludes that numerous options exist for striking a reasonable and politically viable balance between these two objectives. In the effort to forge consensus around a particular set of options, it will be important for policymakers to strive to fit the remedy to the problem they are trying to solve and to preserve the underlying integrity of the overall program in terms of its long-term ability to sustain meaningful market incentives for low-carbon technologies.
Author : A. Denny Ellerman
Publisher : Cambridge University Press
Page : 388 pages
File Size : 32,67 MB
Release : 2000-06-19
Category : Business & Economics
ISBN : 0521660831
The book analyzes the behavior and performance of the market for emissions permits, called allowances in the Acid Rain Program, and quantifies emission reductions, compliance costs, and cost savings associated with the trading program."--BOOK JACKET.