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Energy substitutions, climate change and carbon sinks

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  • Lafforgue, Gilles
  • Magné, Bertrand
  • Moreaux, Michel

Abstract

We determine the optimal exploitation time-paths of two energy resources, one being depletable and polluting, namely a fossil fuel, the other being renewable and clean. These optimal paths are considered along with the two following features. First, the cumulative atmospheric pollution stock is set not to exceed some critical threshold and second, the polluting emissions produced by the use of fossil fuel can be reduced at the source and stockpiled in several carbon sinks of limited capacity. We show that, if the renewable resource flow is abundant, the optimal path requires that sequestration is implemented only once the ceiling is reached. Moreover, the reservoirs should be completely filled by increasing order of their respective sequestration costs.

Suggested Citation

  • Lafforgue, Gilles & Magné, Bertrand & Moreaux, Michel, 2008. "Energy substitutions, climate change and carbon sinks," Ecological Economics, Elsevier, vol. 67(4), pages 589-597, November.
  • Handle: RePEc:eee:ecolec:v:67:y:2008:i:4:p:589-597
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    Cited by:

    1. Anderson, Blake & M'Gonigle, Michael, 2012. "Does ecological economics have a future?," Ecological Economics, Elsevier, vol. 84(C), pages 37-48.
    2. VARDAR, N. Baris, 2013. "Imperfect resource substitution and optimal transition to clean technologies," CORE Discussion Papers 2013072, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    3. Renaud Coulomb & Fanny Henriet, 2010. "Carbon price and optimal extraction of a polluting fossil fuel with restricted carbon capture," PSE Working Papers halshs-00564852, HAL.
    4. Moreaux, Michel & Withagen, Cees, 2013. "Climate Change and Carbon Capture and Storage," IDEI Working Papers 774, Institut d'Économie Industrielle (IDEI), Toulouse.
    5. Niko Jaakkola, 2013. "Monopolistic Sequestration of European Carbon Emissions," OxCarre Working Papers 098, Oxford Centre for the Analysis of Resource Rich Economies, University of Oxford.
    6. Amigues, Jean-Pierre & Chakravorty, Ujjayant & Lafforgue, Gilles & Moreaux, Michel, 2012. "Renewable Portfolio Standards and implicit tax-subsidy schemes: Structural differences induced by quantity and proportional mandates," LERNA Working Papers 12.02.359, LERNA, University of Toulouse.
    7. Amigues, Jean-Pierre & Lafforgue, Gilles & Moreaux, Michel, 2012. "Optimal Timing of Carbon Capture Policies Under Alternative CCS Cost Functions," TSE Working Papers 12-318, Toulouse School of Economics (TSE).
    8. Pierre-André Jouvet & Marie Renner, 2014. "Social Acceptance and Optimal Pollution: CCS or Tax?," Post-Print hal-01385960, HAL.
    9. Grimaud, André & Rouge, Luc, 2014. "Carbon sequestration, economic policies and growth," Resource and Energy Economics, Elsevier, vol. 36(2), pages 307-331.
    10. Alain Jean-Marie & Michel Moreaux & Mabel Tidball, 2011. "Carbon sequestration in leaky reservoirs," Post-Print hal-00863230, HAL.
    11. Amigues, Jean-Pierre & Moreaux, Michel, 2016. "Pollution Abatement v.s. Energy Efficiency Improvements," TSE Working Papers 16-626, Toulouse School of Economics (TSE).
    12. Amigues, Jean-Pierre & Lafforgue, Gilles & Moreaux, Michel, 2016. "Optimal timing of carbon capture policies under learning-by-doing," Journal of Environmental Economics and Management, Elsevier, vol. 78(C), pages 20-37.
    13. Grimaud, André & Lafforgue, Gilles & Magné, Bertrand, 2011. "Climate change mitigation options and directed technical change: A decentralized equilibrium analysis," Resource and Energy Economics, Elsevier, vol. 33(4), pages 938-962.
    14. Ayong Le Kama, Alain & Fodha, Mouez & Lafforgue, Gilles, 2009. "Optimal Carbon Capture and Storage Policies," TSE Working Papers 09-095, Toulouse School of Economics (TSE).
    15. repec:dau:papers:123456789/12981 is not listed on IDEAS
    16. Panwar, N.L. & Kaushik, S.C. & Kothari, Surendra, 2011. "Role of renewable energy sources in environmental protection: A review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 15(3), pages 1513-1524, April.
    17. Di Maria, Corrado & Smulders, Sjak & van der Werf, Edwin, 2012. "Absolute abundance and relative scarcity: Environmental policy with implementation lags," Ecological Economics, Elsevier, vol. 74(C), pages 104-119.
    18. Moreaux, Michel & Withagen, Cees, 2015. "Optimal abatement of carbon emission flows," Journal of Environmental Economics and Management, Elsevier, vol. 74(C), pages 55-70.
    19. Jean Pierre Amigues & Gilles Lafforgue & Michel Moreaux, 2010. "Optimal capture and sequestration from the carbon emission flow and from the atmospheric carbon stock with heterogeneous energy consuming sectors," LERNA Working Papers 10.05.311, LERNA, University of Toulouse.
    20. Amigues, Jean-Pierre & Lafforgue, Gilles & Moreaux, Michel, 2014. "Optimal Timing of Carbon Capture and Storage Policies Under Learning-by-doing," IDEI Working Papers 824, Institut d'Économie Industrielle (IDEI), Toulouse, revised May 2014.
    21. André Grimaud & Luc Rouge, 2009. "Séquestration du carbone et politique climatique optimale," Economie & Prévision, La Documentation Française, vol. 0(4), pages 53-69.
    22. Amigues, Jean-Pierre & Lafforgue, Gilles & Moreaux, Michel, 2014. "Optimal Timing of CCS Policies under Decreasing Returns to Scale," TSE Working Papers 14-529, Toulouse School of Economics (TSE).
    23. Bouwe Dijkstra & Maria J. Gil-Moltó, 2014. "Is Emission Intensity or Output U-shaped in the Strictness of Environmental Policy," CESifo Working Paper Series 4833, CESifo Group Munich.
    24. Andreas A. Renz & Christoph Weber, 2012. "A Hotelling Model for Fixed-Cost Driven Power Generation," EWL Working Papers 1206, University of Duisburg-Essen, Chair for Management Science and Energy Economics, revised Jan 2013.

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