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Technological Modifications in the Nitrogen Oxides Tradable Permit Program

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  • Joshua Linn

Abstract

Tradable permit programs allow firms greater flexibility in reducing emissions than command-and-control regulations and encourage firms to use low cost abatement options, including small-scale modifications to capital equipment. This paper shows that firms have extensively modified capital equipment in the Nitrogen Oxides Budget Trading Program, which covers power plants in the eastern United States. The empirical strategy uses geographic and temporal features of the program to estimate counterfactual emissions, finding that modifications have reduced emission rates by approximately 10-15 percent. The modifications would not have occurred under command-and-control regulation and have reduced regulatory costs.

Suggested Citation

  • Joshua Linn, 2008. "Technological Modifications in the Nitrogen Oxides Tradable Permit Program," The Energy Journal, , vol. 29(3), pages 153-176, July.
    • Handle: RePEc:sae:enejou:v:29:y:2008:i:3:p:153-176
    DOI: 10.5547/ISSN0195-6574-EJ-Vol29-No3-8
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    References listed on IDEAS

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    Cited by:

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    2. Fraas, Arthur G. & Kopits, Elizabeth & Wolverton, Ann, 2021. "A Retrospective Review of Retrospective Cost Analyses," RFF Working Paper Series 21-29, Resources for the Future.
    3. Zhang, Weijie & Li, Bowen, 2025. "Energy-use rights trading, technological innovation, and green transformation of energy-intensive manufacturing enterprises," Economic Analysis and Policy, Elsevier, vol. 86(C), pages 528-544.

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