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Impact of Relative Fuel Prices on CO2 Emission Policies

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  • Nick Macaluso
  • Robin White

Abstract

The multi-sector end-use energy model E3MC was used to analyze the energy and greenhouse gas emissions impact of adding a carbon tax to efficiency improvement standards for the residential sector in Canada and the USA. Compared to standards alone, the addition of the tax led to further residential emission reductions in Canada, but attenuated the residential emission reductions in the USA. Examination of the relative residential electricity:natural gas prices demonstrated that the different country impacts were due to an increase in relative prices in the USA, but a decrease in relative prices in Canada that led to opposite shifts in preference for electricity over natural gas in the residential sector. Markedly different impacts of the carbon tax on electricity prices was due to the predominance of hydroelectric power in Canada and coal-fired electric generation in the USA. doi: 10.5547/ISSN0195-6574-EJ-Vol32-SI1-6

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  • Nick Macaluso & Robin White, 2011. "Impact of Relative Fuel Prices on CO2 Emission Policies," The Energy Journal, , vol. 32(1_suppl), pages 89-110, June.
    • Handle: RePEc:sae:enejou:v:32:y:2011:i:1_suppl:p:89-110
    DOI: 10.5547/ISSN0195-6574-EJ-Vol32-SI1-6
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    References listed on IDEAS

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    3. Parry, Ian W. H. & Williams III, Roberton C., 1999. "A second-best evaluation of eight policy instruments to reduce carbon emissions," Resource and Energy Economics, Elsevier, vol. 21(3-4), pages 347-373, August.
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