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Industry-level emission trading between power producers in the EU

Author

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  • Böhringer, Christoph

Abstract

In this paper we investigate how restrictions for emission trading to the energy-intensive power sector will affect the magnitude and distribution of abatement costs across EU countries vis-?-vis a comprehensive EU emission trading regime. We find that emission trading between European power sectors allows the harvest of a major part of the efficiency gains provided by full trade as compared to strictly domestic action. However, trade restrictions may create a more unequal distribution of abatement costs across member states than is the case for a comprehensive trade regime. The reason for this is that restricted permit trade enhances the secondary terms-of-trade benefits to EU member countries with low marginal abatement costs at the expense of the other EU member states.

Suggested Citation

  • Böhringer, Christoph, 2000. "Industry-level emission trading between power producers in the EU," ZEW Discussion Papers 00-46, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  • Handle: RePEc:zbw:zewdip:5330
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    File URL: https://www.econstor.eu/bitstream/10419/24394/1/dp0046.pdf
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    References listed on IDEAS

    as
    1. Bohringer, Christoph, 2000. "Cooling down hot air: a global CGE analysis of post-Kyoto carbon abatement strategies," Energy Policy, Elsevier, vol. 28(11), pages 779-789, September.
    2. Böhringer, Christoph & Jensen, Jesper & Rutherford, Thomas F., 1999. "Energy market projections and differentiated carbon abatement in the European Union," ZEW Discussion Papers 99-11, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
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    Cited by:

    1. Böhringer, Christoph & Vogt, Carsten, 2001. "Internationaler Klimaschutz: Nicht mehr als symbolische Politik?," ZEW Discussion Papers 01-06, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.

    More about this item

    Keywords

    emission trading; computable general equilibrium;

    JEL classification:

    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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