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The Potential for Cost Savings in the Sulfur Dioxide Allowance Market: Empirical Evidence from Florida

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  • John R. Swinton
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    Abstract

    Since the passage of the 1990 Clean Air Act Amendments, researchers have hastened to appraise the new market for sulfur dioxide (SO2) emission allowances. As the EPA’s program moves into its second phase, some analysts question whether large enough savings are available to induce widespread market participation. This study calculates the shadow prices of emission reductions for power plants that serve Florida and compares the actions of utility owners to the actions predicted by the shadow prices. The evidence suggests that plant owners have not taken full advantage of the opportunities the allowance market has provided to date.

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    Bibliographic Info

    Article provided by University of Wisconsin Press in its journal Land Economics.

    Volume (Year): 78 (2002)
    Issue (Month): 3 ()
    Pages: 390-404

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    Handle: RePEc:uwp:landec:v:78:y:2002:i:3:p:390-404

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    Web page: http://le.uwpress.org/

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    Cited by:
    1. Shobe, William M. & Burtraw, Dallas, 2012. "Rethinking Environmental Federalism in a Warming World," Discussion Papers dp-12-04, Resources For the Future.
    2. Kumar, Surender, 2003. "Productivity and profitability changes in the U.S. electric power plants during SO2 trading regime," Working Papers 03/3, National Institute of Public Finance and Policy.
    3. Hahn, Robert W. & Stavins, Robert Norman, 2010. "The Effect of Allowance Allocations on Cap-and-Trade System Performance," Scholarly Articles 4449098, Harvard Kennedy School of Government.
    4. M. Murty & Surender Kumar & Kishore Dhavala, 2007. "Measuring environmental efficiency of industry: a case study of thermal power generation in India," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 38(1), pages 31-50, September.
    5. Erwan Hauvuy & Nicolas Riedinger, 2005. "Une estimation du coût d’abattement de la pollution atmosphérique pour les entreprises françaises," Économie et Prévision, Programme National Persée, vol. 168(2), pages 63-75.
    6. John Swinton, 2004. "Phase I Completed: An Empirical Assessment of the 1990 CAAA," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 27(3), pages 227-246, March.
    7. Myunghun, Lee, 2011. "Potential cost savings from internal/external CO2 emissions trading in the Korean electric power industry," Energy Policy, Elsevier, vol. 39(10), pages 6162-6167, October.
    8. Mohamed Amine Boutaba, 2009. "Investigating efficiency in the U.S sulfur dioxide permit market," Economics Bulletin, AccessEcon, vol. 29(2), pages 1308-1319.
    9. Rezek, Jon P. & Campbell, Randall C., 2007. "Cost estimates for multiple pollutants: A maximum entropy approach," Energy Economics, Elsevier, vol. 29(3), pages 503-519, May.
    10. repec:ind:nipfwp:03 is not listed on IDEAS
    11. Burtraw, Dallas & Szambelan, Sarah Jo, 2009. "U.S. Emissions Trading Markets for SO2 and NOx," Discussion Papers dp-09-40, Resources For the Future.
    12. repec:ind:nipfwp:17 is not listed on IDEAS

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