Auctioning Greenhouse Gas Emissions Permits in Australia
AbstractThe allocation of permits is an important design aspect of an emissions trading scheme. Traditionally, governments have favoured the free allocation of greenhouse gas permits based on individual historical emissions (‘grandfathering’) or industry benchmark data. Particularly in the EU, the free allocation of permits has proven complex and inefficient and the distributional implications are politically difficult to justify; auctioning emissions permits has therefore become more popular. The EU is now moving to auction more than 50 per cent of all permits in 2013, and in the US the Regional Greenhouse Gas Initiative (RGGI) has begun auctioning more than 90 per cent of total allowances. Another case in point is the Australian proposal for a Carbon Pollution Reduction Scheme (CPRS), which provides for auctioning a significant share of total permits. This paper discusses the proposed Australian CPRS’s auction design. A major difference to other emissions trading schemes is that the CPRS plans to auction multiple vintages of emissions permits simultaneously.
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Bibliographic InfoPaper provided by University of Maryland, Department of Economics - Peter Cramton in its series Papers of Peter Cramton with number 09aghg.
Length: 28 pages
Date of creation: 2009
Date of revision: 2009
Publication status: Published in Australian Journal of Agricultural and Resource Economics, 54, 219-238, 2010
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Postal: Economics Department, University of Maryland, College Park, MD 20742-7211
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Auctions; carbon auctions; greenhouse gas auctions;
Other versions of this item:
- Betz, Regina & Seifert, Stefan & Cramton, Peter & Kerr, Suzi, 2010. "Auctioning greenhouse gas emissions permits in Australia," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 54(2), June.
- Betz, Regina & Seifert, Stefan & Cramton, Peter & Kerr, Suzi, 2009. "Auctioning Greenhouse Gas Emissions Permits in Australia," Research Reports 94878, Australian National University, Environmental Economics Research Hub.
- Regina Betz & Stefan Seifert & Peter Cramton & Suzi Kerr, 2009. "Auctioning greenhouse gas emissions permits in Australia," Environmental Economics Research Hub Research Reports 0929, Environmental Economics Research Hub, Crawford School of Public Policy, The Australian National University.
- D44 - Microeconomics - - Market Structure and Pricing - - - Auctions
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-06-03 (All new papers)
- NEP-ENE-2009-06-03 (Energy Economics)
- NEP-ENV-2009-06-03 (Environmental Economics)
- NEP-EXP-2009-06-03 (Experimental Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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