Allowance allocation matters in China's carbon emissions trading system
| Autor: | Xiang Chen, Xiaorui Liu, Hancheng Dai, Yana Jin |
|---|---|
| Rok vydání: | 2020 |
| Předmět: |
Upstream (petroleum industry)
Economics and Econometrics Natural resource economics 020209 energy 05 social sciences Allowance (money) Subsidy 02 engineering and technology General Energy Electricity generation Sectoral output Greenhouse gas 0502 economics and business 0202 electrical engineering electronic engineering information engineering Emissions trading Business 050207 economics China |
| Zdroj: | Energy Economics. 92:105012 |
| ISSN: | 0140-9883 |
| Popis: | China's national carbon emissions trading system (ETS) initially started by covering the power generation sector with a rate-based allocation of emission allowances. This single-sector ETS scheme is a tradable performance standard and loosens the participants' emission abatement effort. Given the stringent emission reduction targets implied by China's Nationally Determined Contributions (NDCs) and the expectation that ETS will cover more sectors in the future, we simulate a national ETS of ten carbon-intensive sectors with mass-based, output-based allocation (OBA) of emission allowances. We uncover the impacts and mechanisms of this ETS by comparing the sectoral abatement behaviors across policy scenarios with varying allocation schemes and numbers of benchmarks. We evaluate if the simulated ETS meets important efficiency principles and exhibits desired features. The results show that this ETS achieves China's NDCs with modest macroeconomic losses. The mass-based OBA leads to evenly distributed emission reduction efforts for all ETS participating sectors. It also limits the emission trading volumes and results in slight to modest impacts on sectoral output, especially for the upstream sectors. OBA with fewer benchmarks enhances emission abatement efforts with the caveats of relatively cleaner participants being subsidized by the ETS and slightly higher impacts on the macroeconomy. |
| Databáze: | OpenAIRE |
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