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Policy Options to Reduce Electricity Greenhouse Gas Emissions

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  • John Freebairn

Abstract

The design and effects of different schemes to reduce greenhouse gas emissions associated with the production and consumption of electricity are modelled. The tax scheme achieves the lowest cost per unit emission reduction because it encourages both businesses and consumers to reduce emissions, and the recycled windfall revenue can meet equity objectives. Comparing the Emissions Intensity Scheme (EIS), Clean Energy Target (CET) and Renewable Energy Target (RET) schemes with common government revenue neutral and emissions reduction design outcomes, the EIS provides better incentives to generators to find the lower cost per unit emissions reduction.

Suggested Citation

  • John Freebairn, 2018. "Policy Options to Reduce Electricity Greenhouse Gas Emissions," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 51(4), pages 474-485, December.
    • Handle: RePEc:bla:ausecr:v:51:y:2018:i:4:p:474-485
    DOI: 10.1111/1467-8462.12278
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    Cited by:

    1. Alan Rai & Tim Nelson, 2020. "Australia's National Electricity Market after Twenty Years," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 53(2), pages 165-182, June.
    2. Tim Nelson & Tahlia Nolan & Joel Gilmore, 2022. "What’s next for the Renewable Energy Target – resolving Australia’s integration of energy and climate change policy?," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 66(1), pages 136-163, January.
    3. Nelson, Tim & Pascoe, Owen & Calais, Prabpreet & Mitchell, Lily & McNeill, Judith, 2019. "Efficient integration of climate and energy policy in Australia’s National Electricity Market," Economic Analysis and Policy, Elsevier, vol. 64(C), pages 178-193.

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