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An Integrated Approach to Simulate the Impacts of Carbon Emissions Trading Schemes

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  • Xavier Labandeira Villot
  • Pedro Linares
  • Miguel Rodríguez

Abstract

The present paper aims to reliably depict the impact of the European Union Emissions Trading Scheme (EU ETS) on Spain under different assumptions about the industries involved. Prior analyses, based either on highly aggregated macroeconomic or specific electricity industry models, have been limited in degree of detail or scope. Two types of modeling were combined in the present study: general equilibrium was used to assess the impact on different industries and to explain cross-industry changes, and partial equilibrium to suitably model the complex and crucial electricity system. Combining and interrelating these two models yields the effects on price, carbon dioxide (CO2) emissions and distributional patterns in Spain of both the current policy and an alternative in which all industries take part in the EU ETS. Since Spain is a key participant in this scheme, the conclusions and policy implications stemming from this paper are relevant to and useful for post-Kyoto arrangements.

Suggested Citation

  • Xavier Labandeira Villot & Pedro Linares & Miguel Rodríguez, 2009. "An Integrated Approach to Simulate the Impacts of Carbon Emissions Trading Schemes," Working Papers 2009-29, FEDEA.
  • Handle: RePEc:fda:fdaddt:2009-29
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    References listed on IDEAS

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    Cited by:

    1. Liu, Yu & Tan, Xiu-Jie & Yu, Yang & Qi, Shao-Zhou, 2017. "Assessment of impacts of Hubei Pilot emission trading schemes in China – A CGE-analysis using TermCO2 model," Applied Energy, Elsevier, pages 762-769.
    2. Riekkola, Anna Krook & Berg, Charlotte & Ahlgren, Erik O. & Söderholm, Patrik, 2013. "Challenges in Soft-Linking: The Case of EMEC and TIMES-Sweden," Working Papers 133, National Institute of Economic Research.
    3. Anil Markandya & Mikel González- Eguino & Marta Escapa, 2012. "Environmental fiscal reform and unemployment in Spain," Chapters,in: Carbon Pricing, Growth and the Environment, chapter 1, pages 3-16 Edward Elgar Publishing.
    4. Tapia-Ahumada, Karen & Octaviano, Claudia & Rausch, Sebastian & Pérez-Arriaga, Ignacio, 2015. "Modeling intermittent renewable electricity technologies in general equilibrium models," Economic Modelling, Elsevier, vol. 51(C), pages 242-262.
    5. Van den Bergh, Kenneth & Delarue, Erik, 2015. "Quantifying CO2 abatement costs in the power sector," Energy Policy, Elsevier, vol. 80(C), pages 88-97.
    6. Fan, Jin & He, Haonan & Wu, Yanrui, 2016. "Personal carbon trading and subsidies for hybrid electric vehicles," Economic Modelling, Elsevier, vol. 59(C), pages 164-173.
    7. Childs, Jack, 2012. "Kyoto and the EU CEP 2020: A Dynamic Study of the impacts on the Agricultural Sector in Spain," 86th Annual Conference, April 16-18, 2012, Warwick University, Coventry, UK 135074, Agricultural Economics Society.

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    JEL classification:

    • F0 - International Economics - - General

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