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Reforming Energy Policy in India: Assessing the Options

Author

Listed:
  • Ian W.H. Parry
  • Mr. Victor Mylonas
  • Nate Vernon-Lin

Abstract

Spreadsheet models are used to assess the environmental, fiscal, economic, and incidence effects of a wide range of options for reducing fossil fuel use in India. Among the most effective options is ramping up the existing coal tax. Annually increasing the tax by INR 150 ($2.25) per ton of coal from 2017 to 2030 avoids over 270,000 air pollution deaths, raises revenue of 1 percent of GDP in 2030, reduces CO2 emissions 12 percent, and generates net economic benefits of approximately 1 percent of GDP. The policy is mildly progressive and (at least initially) imposes a relatively modest cost burden on industries.

Suggested Citation

  • Ian W.H. Parry & Mr. Victor Mylonas & Nate Vernon-Lin, 2017. "Reforming Energy Policy in India: Assessing the Options," IMF Working Papers 2017/103, International Monetary Fund.
    • Handle: RePEc:imf:imfwpa:2017/103
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    Citations

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    Cited by:

    1. Ian Parry & Victor Mylonas, 2018. "Canada's Carbon Price Floor," CESifo Working Paper Series 6959, CESifo.
    2. Valerie Cerra, 2022. "A Framework For Inclusive And Sustainable Growth In Asia And The Pacific," Asia-Pacific Sustainable Development Journal, United Nations Economic and Social Commission for Asia and the Pacific (ESCAP), vol. 29(1), pages 17-41, May.
    3. Bas Jacobs & Rick van der Ploeg, 2017. "Should Pollution Taxes be Targeted at Income Redistribution?," CESifo Working Paper Series 6599, CESifo.
    4. Lawson, Andrew & Harris, Jamelia, 2023. "Is the problem driven iterative adaptation approach (PDIA) a panacea for public financial management reform? Evidence from six African countries," World Development Perspectives, Elsevier, vol. 31(C).
    5. Kopatz, Michael & Wagner, Oliver & Drissen, Isabel & Wiegand, Julia & Theuer, Laura, 2017. "Guthabenzahlung für Strom: Studie über den Breiteneinsatz von Prepaidzählern," Wuppertal Reports 11, Wuppertal Institute for Climate, Environment and Energy.
    6. Theocharis, Dimitrios & Rodrigues, Vasco Sanchez & Pettit, Stephen & Haider, Jane, 2019. "Feasibility of the Northern Sea Route: The role of distance, fuel prices, ice breaking fees and ship size for the product tanker market," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 129(C), pages 111-135.
    7. Coady, David & Prady, Delphine, 2019. "Universal income in developing countries: Issues, options, and illustration for India," World Development Perspectives, Elsevier, vol. 16(C).
    8. Ian Parry & Victor Mylonas & Nate Vernon, 2021. "Mitigation Policies for the Paris Agreement: An Assessment for G20 Countries," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 8(4), pages 797-823.
    9. Parry, Ian, 2020. "Increasing carbon pricing in the EU: Evaluating the options," European Economic Review, Elsevier, vol. 121(C).
    10. Hoffman, Lauren A. & Ngo, Truc T., 2018. "Affordable solar thermal water heating solution for rural Dominican Republic," Renewable Energy, Elsevier, vol. 115(C), pages 1220-1230.
    11. Lee, Rachel & Homan, Samuel & Mac Dowell, Niall & Brown, Solomon, 2019. "A closed-loop analysis of grid scale battery systems providing frequency response and reserve services in a variable inertia grid," Applied Energy, Elsevier, vol. 236(C), pages 961-972.
    12. Sokołowski, Maciej M., 2019. "When black meets green: A review of the four pillars of India's energy policy," Energy Policy, Elsevier, vol. 130(C), pages 60-68.
    13. Burke, Paul J. & Widnyana, Jinnie & Anjum, Zeba & Aisbett, Emma & Resosudarmo, Budy & Baldwin, Kenneth G.H., 2019. "Overcoming barriers to solar and wind energy adoption in two Asian giants: India and Indonesia," Energy Policy, Elsevier, vol. 132(C), pages 1216-1228.
    14. Enongene, K.E. & Murray, P. & Holland, J. & Abanda, F.H., 2017. "Energy savings and economic benefits of transition towards efficient lighting in residential buildings in Cameroon," Renewable and Sustainable Energy Reviews, Elsevier, vol. 78(C), pages 731-742.
    15. Prakash, Vrishab & Ghosh, Sajal & Kanjilal, Kakali, 2020. "Costs of avoided carbon emission from thermal and renewable sources of power in India and policy implications," Energy, Elsevier, vol. 200(C).
    16. Kavvadias, Konstantinos C. & Quoilin, Sylvain, 2018. "Exploiting waste heat potential by long distance heat transmission: Design considerations and techno-economic assessment," Applied Energy, Elsevier, vol. 216(C), pages 452-465.
    17. Jacobs, Bas & van der Ploeg, Frederick, 2019. "Redistribution and pollution taxes with non-linear Engel curves," Journal of Environmental Economics and Management, Elsevier, vol. 95(C), pages 198-226.
    18. Smith, Kate & Liu, Shuming & Liu, Ying & Guo, Shengjie, 2018. "Can China reduce energy for water? A review of energy for urban water supply and wastewater treatment and suggestions for change," Renewable and Sustainable Energy Reviews, Elsevier, vol. 91(C), pages 41-58.

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