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Benefits and costs to China of three different climate treaties

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  • Vennemo, Haakon
  • Aunan, Kristin
  • Jianwu, He
  • Tao, Hu
  • Shantong, Li

Abstract

There are currently several ideas on the table for a climate treaty post-Kyoto. We consider the impact on China of three ideas: a cap on the CO2 intensity, a cap on the CO2 level, and a cap on the CO2 intensity in key sectors. We find that a cap on the CO2 intensity gives large environmental co-benefits to China on aggregate, but there are significant negative effects for rural households. Assuming these are addressed the country could reduce its CO2 intensity by a third before costs outweigh environmental co-benefits. By contrast a cap confined to the manufacturing and power sector does not bring substantial co-benefits to China.

Suggested Citation

  • Vennemo, Haakon & Aunan, Kristin & Jianwu, He & Tao, Hu & Shantong, Li, 2009. "Benefits and costs to China of three different climate treaties," Resource and Energy Economics, Elsevier, vol. 31(3), pages 139-160, August.
    • Handle: RePEc:eee:resene:v:31:y:2009:i:3:p:139-160
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    3. Anping Chen & Nicolaas Groenewold, 2013. "Regional Effects in China of an Emissions-Reduction Policy: Tax v. Subsidy," ERSA conference papers ersa13p1275, European Regional Science Association.
    4. Lucas Bretschger & Lin Zhang, 2014. "Going beyond tradition: Carbon policy in a high-growth economy: The case of China," CER-ETH Economics working paper series 14/201, CER-ETH - Center of Economic Research (CER-ETH) at ETH Zurich.
    5. Wei Xie & Ning Li & Chunhua Li & Ji-dong Wu & Aijun Hu & Xiaolin Hao, 2014. "Quantifying cascading effects triggered by disrupted transportation due to the Great 2008 Chinese Ice Storm: implications for disaster risk management," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 70(1), pages 337-352, January.
    6. Bretschger, Lucas & Zhang, Lin, 2017. "Carbon policy in a high-growth economy: The case of China," Resource and Energy Economics, Elsevier, vol. 47(C), pages 1-19.
    7. Niu, Shuwen & Ding, Yongxia & Niu, Yunzhu & Li, Yixin & Luo, Guanghua, 2011. "Economic growth, energy conservation and emissions reduction: A comparative analysis based on panel data for 8 Asian-Pacific countries," Energy Policy, Elsevier, vol. 39(4), pages 2121-2131, April.
    8. Yang, Guangfei & Sun, Tao & Wang, Jianliang & Li, Xianneng, 2015. "Modeling the nexus between carbon dioxide emissions and economic growth," Energy Policy, Elsevier, vol. 86(C), pages 104-117.
    9. Anping Chen & Nicolaas Groenewold, 2014. "The regional economic effects of a reduction in carbon emissions and an evaluation of offsetting policies in China," Papers in Regional Science, Wiley Blackwell, vol. 93(2), pages 429-453, June.
    10. Eskeland, Gunnar S. & Rive, Nathan A. & Mideksa, Torben K., 2012. "Europe’s climate goals and the electricity sector," Energy Policy, Elsevier, vol. 41(C), pages 200-211.
    11. Niu, Shuwen & Zhang, Xin & Zhao, Chunsheng & Niu, Yunzhu, 2012. "Variations in energy consumption and survival status between rural and urban households: A case study of the Western Loess Plateau, China," Energy Policy, Elsevier, vol. 49(C), pages 515-527.
    12. Zhao, Xiaoli & Yin, Haitao, 2011. "Industrial relocation and energy consumption: Evidence from China," Energy Policy, Elsevier, vol. 39(5), pages 2944-2956, May.
    13. Dai, Hancheng & Masui, Toshihiko & Matsuoka, Yuzuru & Fujimori, Shinichiro, 2011. "Assessment of China's climate commitment and non-fossil energy plan towards 2020 using hybrid AIM/CGE model," Energy Policy, Elsevier, vol. 39(5), pages 2875-2887, May.
    14. Beck, Marisa & Rivers, Nicholas & Yonezawa, Hidemichi, 2016. "A rural myth? Sources and implications of the perceived unfairness of carbon taxes in rural communities," Ecological Economics, Elsevier, vol. 124(C), pages 124-134.
    15. Haakon Vennemo & Jianwu He & Shantong Li, 2014. "Macroeconomic Impacts of Carbon Capture and Storage in China," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 59(3), pages 455-477, November.
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