Efficiency, Productivity and Environmental Policy: A Case Study of Power Generation in the EU
AbstractThis study uses the EU public power generating sector as a case study to investigate the environmental efficiency and productivity enhancing performance of the European Union’s CO2 Emissions Trading Scheme (EU ETS) in its pilot phase. Using Data Envelopment Analysis methods, we measure the environmental efficiency and the productivity growth registered in public power generation across the EU over the 1996-2007 period. In the second stage of our analysis we attempt to explain changes in productivity and efficiency over time using state-of-the-art econometric techniques. Our analysis suggests two conclusions: on the one hand carbon pricing led to an increase in environmental efficiency and to a shift outwards of the technological frontier; on the other hand, the overly generous allocation of emission permits had a negative impact on both measures. These results are shown to be robust to changes in controls and specifications.
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Bibliographic InfoPaper provided by Fondazione Eni Enrico Mattei in its series Working Papers with number 2011.19.
Date of creation: Feb 2011
Date of revision:
Emissions Trading; EU ETS; Environmental Efficiency; Productivity Growth; Data Envelopment Analysis;
Other versions of this item:
- Jaraitė, Jūratė & Di Maria, Corrado, 2012. "Efficiency, productivity and environmental policy: A case study of power generation in the EU," Energy Economics, Elsevier, vol. 34(5), pages 1557-1568.
- Jaraite, Jurate & Di Maria, Corrado, 2011. "Efficiency, Productivity and Environmental Policy: A Case Study of Power Generation in the EU," CERE Working Papers 2011:3, CERE - the Center for Environmental and Resource Economics.
- O38 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Government Policy
- Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
- Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-05-14 (All new papers)
- NEP-EFF-2011-05-14 (Efficiency & Productivity)
- NEP-ENE-2011-05-14 (Energy Economics)
- NEP-ENV-2011-05-14 (Environmental Economics)
- NEP-EUR-2011-05-14 (Microeconomic European Issues)
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