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Distributive fairness in paying for clean energy infrastructure

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  • Granqvist, Harry
  • Grover, David

Abstract

Despite the rapid rise in public expenditure on clean energy infrastructure, there has been little discussion about what constitutes a fair distribution of this new spending burden. We examine four ethical principles that speak to different notions of fairness in the way this burden can and should be shared, and use them to produce three normative criteria for pursuing fairness in the clean energy fiscal policy context. We use these criteria to examine the extent to which fairness is being achieved in large clean energy roll-out programs in Australia, California and the United Kingdom. Maintaining a close focus on providing practical guidance for decision makers in similar policy contexts, we find that fairness is more achievable when program design explicitly considers which households should pay for the program and which should be exempt; when the idea of proportionality guides the distribution of the cost across paying households, and when the interests of low-income households are protected, by ensuring that they share in the benefits of the program, for example.

Suggested Citation

  • Granqvist, Harry & Grover, David, 2016. "Distributive fairness in paying for clean energy infrastructure," Ecological Economics, Elsevier, vol. 126(C), pages 87-97.
  • Handle: RePEc:eee:ecolec:v:126:y:2016:i:c:p:87-97
    DOI: 10.1016/j.ecolecon.2016.02.012
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    References listed on IDEAS

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    1. repec:eee:energy:v:141:y:2017:i:c:p:1998-2012 is not listed on IDEAS
    2. repec:eee:enepol:v:106:y:2017:i:c:p:255-265 is not listed on IDEAS

    More about this item

    Keywords

    Environmental taxes and subsidies; Distributional impacts; Equity; Energy policy; Renewable energy;

    JEL classification:

    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures
    • O2 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
    • Q5 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics

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