The 1990 Clean Air Act and the Implicit Price of Sulfur in Coal
AbstractPrior to implementation of the 1990 Clean Air Act Amendments (CAAA), many estimates of the marginal cost of SO2 abatement were provided to guide policy makers. Numerous studies estimated the marginal cost of abatement to be between $250 and $760 per ton, though permits initially traded well below $200 and remained below $220 until 2004. We use a fixed effects estimator and a hedonic price model of coal purchases in order to determine the implicit price of sulfur. Data on contract coal purchases are divided into regulatory regimes based on when the contract was signed or re-negotiated. We find that purchases by Phase I plants made under contracts signed or re-negotiated after the passage of the 1990 CAAA show an implicit price of SO2 of approximately $50 per ton, an amount much closer to the eventual permit price. The implicit market price of sulfur seems to have revealed better information than did the calculations of industry experts.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by De Gruyter in its journal The B.E. Journal of Economic Analysis & Policy.
Volume (Year): 7 (2007)
Issue (Month): 1 (August)
Contact details of provider:
Web page: http://www.degruyter.com
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Kosnik, Lea & Lange, Ian, 2009.
"Contract Renegotiation and Rent Re-Redistribution: Who Gets Raked Over the Coals?,"
Stirling Economics Discussion Papers, University of Stirling, Division of Economics
2009-25, University of Stirling, Division of Economics.
- Kosnik, Lea & Lange, Ian, 2011. "Contract renegotiation and rent re-distribution: Who gets raked over the coals?," Journal of Environmental Economics and Management, Elsevier, vol. 62(2), pages 155-165, September.
- Di Maria, Corrado & Lange, Ian & van der Werf, Edwin, 2014.
"Should we be worried about the green paradox? Announcement effects of the Acid Rain Program,"
European Economic Review, Elsevier,
Elsevier, vol. 69(C), pages 143-162.
- Corrado Di Maria & Ian A. Lange & Edwin van der Werf, 2012. "Should we be Worried about the Green Paradox? Announcement Effects of the Acid Rain Program," CESifo Working Paper Series 3829, CESifo Group Munich.
- Corrado Di Maria & Ian Lange & Edwin van der Werf, 2012. "Should We Be Worried About the Green Paradox? Announcement Effects of the Acid Rain Program," Working Papers, Fondazione Eni Enrico Mattei 2012.49, Fondazione Eni Enrico Mattei.
- H. Ron Chan & Harrison Fell & Ian A. Lange & Shanjun Li, 2013.
"Efficiency and Environmental Impacts of Electricity Restructuring on Coal-Fired Power Plants,"
CESifo Working Paper Series
4160, CESifo Group Munich.
- H. Ron Chan & Harrison Fell & Ian Lange & Shanjun Li, 2013. "Effciency and Environmental Impacts of Electricity Restructuring on Coal-Fired Power Plants," Working Papers, Colorado School of Mines, Division of Economics and Business 2013-01, Colorado School of Mines, Division of Economics and Business.
- Heutel, Garth, 2011. "Plant vintages, grandfathering, and environmental policy," Journal of Environmental Economics and Management, Elsevier, vol. 61(1), pages 36-51, January.
- He, Qingxin & Lee, Jonathan M., 2014. "Additional market incentives for abatement: An analysis of flue-gas desulfurization by-products," Resource and Energy Economics, Elsevier, Elsevier, vol. 36(2), pages 370-393.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Peter Golla).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.