Addressing the Climate Problem: Choice between Allowances, Feed-in Tariffs and Taxes
Publikation: Working paper › Forskning
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Addressing the Climate Problem : Choice between Allowances, Feed-in Tariffs and Taxes. / Amundsen, Eirik S.; Andersen, Peder; Mortensen, Jørgen Birk.
Munich Society for the Promotion of Economic Research ‐ CESifo, 2018.Publikation: Working paper › Forskning
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TY - UNPB
T1 - Addressing the Climate Problem
T2 - Choice between Allowances, Feed-in Tariffs and Taxes
AU - Amundsen, Eirik S.
AU - Andersen, Peder
AU - Mortensen, Jørgen Birk
PY - 2018
Y1 - 2018
N2 - Instruments chosen to pursue climate related targets are not always efficient. In this paper we consider an economy with three climate related targets for its electricity generation: a given share of “green” electricity, a given expansion of “green” electricity, and a given reduction of “black” (fossil based) electricity. At its disposal the country has three instruments: an allowance system (tradable green certificates), a subsidy system (feed-in tariffs) and a Pigouvian fossil tax. Each of these instruments may be used to attain any of the given targets. Within the setting of the model it is verified that each kind of the target has only a single efficient instrument under certainty, and that there is a deadweight loss of using other instruments to achieve the target. Similarly, there is also an analysis of instrument choice when several targets are to be attained at the same time. The paper also discusses the case of simultaneous targets as well as the relevanceof the various targets.
AB - Instruments chosen to pursue climate related targets are not always efficient. In this paper we consider an economy with three climate related targets for its electricity generation: a given share of “green” electricity, a given expansion of “green” electricity, and a given reduction of “black” (fossil based) electricity. At its disposal the country has three instruments: an allowance system (tradable green certificates), a subsidy system (feed-in tariffs) and a Pigouvian fossil tax. Each of these instruments may be used to attain any of the given targets. Within the setting of the model it is verified that each kind of the target has only a single efficient instrument under certainty, and that there is a deadweight loss of using other instruments to achieve the target. Similarly, there is also an analysis of instrument choice when several targets are to be attained at the same time. The paper also discusses the case of simultaneous targets as well as the relevanceof the various targets.
M3 - Working paper
T3 - CESifo Working Papers
BT - Addressing the Climate Problem
PB - Munich Society for the Promotion of Economic Research ‐ CESifo
ER -
ID: 192514461