Technological Uncertainty and Cost-effectiveness of CO2 Emission Trading Schemes

Arbeitspapier

This paper studies implications of uncertainty about the arrival date of a competitive CO2 backstop technology for the design of cost-effective CO2 emission trading schemes. For this purpose, we develop a dynamic general equilibrium model that captures empirical links between CO2 emissions associated with energy use, the rate and direction of technical change and the economy. We specify CO2 capture and storage (CCS) as the backstop technology whose competitiveness is anticipated or not. We find that the discounted welfare loss associated with the environmental target is lower if CCS is not anticipated and that CO2 shadow prices are then relatively high in the years before CCS is competitive. By not simply postponing the implementation of an emission reduction strategy until CCS is competitive, one relies more on economy-wide technical change and its welfare-enhancing technology externalities, thus allowing for a higher steady state.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: ZEW Discussion Papers ; No. 08-050

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Computable and Other Applied General Equilibrium Models ; Energy and the Macroeconomy ; Search; Learning; Information and Knowledge; Communication; Belief; Unawareness ; Taxation and Subsidies: Externalities; Redistributive Effects; Environmental Taxes and Subsidies ; Technological Change: Choices and Consequences; Diffusion Processes
• Thema: CO2 capture and storage ; computable general equilibrium modeling ; directed technical change ; emission trading ; technological uncertainty ; Emissionshandel ; Mechanism Design ; Klimaschutz ; Wirtschaftlichkeit ; Umwelttechnik ; Risiko ; Dynamisches Modell ; Allgemeines Gleichgewicht ; Theorie

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Otto, Vincent M. ; Löschel, Andreas
• Ereignis: Veröffentlichung
• (wer): Zentrum für Europäische Wirtschaftsforschung (ZEW)
• (wo): Mannheim
• (wann): 2008

Weitere Informationen

• Handle: http://hdl.handle.net/10419/24746
• Letzte Aktualisierung: 20.09.2024, 08:25 MESZ