Allowance allocation matters in China's carbon emissions trading system

Jin, Yana; Liu, Xiaorui; Chen, Xiang; Dai, Hancheng

doi:10.1016/j.eneco.2020.105012

Cited by 47 publications

(14 citation statements)

References 29 publications

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“…Tang et al simulated the marginal abatement cost curves of different sectors in China's ETS and calculated the optimal carbon price of sector coverage scenarios based on the criteria involving eight industries [55]. Jin et al simulated a national ETS of ten carbon-intensive sectors with the mass-based, output-based allocation (OBA) of emission allowances [56]. The issue of allowance allocation is a critical part of the ETS.…”

Section: Methods Of Allowance Allocation In the Etsmentioning

confidence: 99%

A Scientometric Analysis and Review of the Emissions Trading System

Yang

Duan

et al. 2022

Energies

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As a vital market mechanism to mitigate global warming, the emissions trading system (ETS) has critical research and practice value. According to articles from Web of Science’s core collection, quantitative statistics are used to analyze the ETS, including statistics on the number of articles, distributions of time and geography, journals and subjects, productive authors and institutions, academic collation, article citations, and hot topics. Moreover, this paper presents a qualitative analysis of research on the ETS, exploring hot issues, including its origin, allowance allocation, the impact of allowance allocation, and the ETS in the power sector. The results show that it is necessary to launch ETS to mitigate climate change effectively and reduce emissions at a low cost. Allowance allocation as its critical component has also caused heated discussion among scholars. In allowance allocation, exploring a desire to assign the future allowable carbon emissions reasonably and efficiently is vital, yet scholars widely do not accept this. Moreover, free allocation can only be applied to the transitional stage, and auctioning will be inevitable. In addition, scholars have studied the impact of different allowance allocation schemes from macro and micro perspectives and take the power sector, namely the largest emitter, as an example, by linear programming, equilibrium modeling, and multi-agent modeling. However, the quota allocation scheme needs improvement due to firms’ accuracy of emission data. Finally, governments are encouraged to launch the ETS to reduce emissions and combat climate change. The ETS should be improved gradually, including aspects such as cap setting, covering sectors, and the allocation method. Additionally, some key emission sectors and regions can be taken as the research and practice objects in the initial stage of the ETS.

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Section: Methods Of Allowance Allocation In the Etsmentioning

confidence: 99%

A Scientometric Analysis and Review of the Emissions Trading System

Yang

Duan

et al. 2022

Energies

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“…Autonomous Energy Efficiency Improvement (AEEI) or Total Factor Productivity (TFP) is one of the key parameters for model dynamics in the CGE model. Some of the CGE modelers make GDP exogenous and TFP endogenous, run the model from the base year to the current year by the real GDP and estimate AEEI or TFP [43] , [44] . The method can make the model’s GDP results precisely full in the actual GDP; however, this kind of method usually assumes that the total factor productivity of each industry is the same.…”

Section: Methodology and Data Sourcementioning

confidence: 99%

The effects and reacts of COVID-19 pandemic and international oil price on energy, economy, and environment in China

2021

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“…However, many believe that fossil energy producers are the responsible entities of electricity markets. The power generation industry was the first to participate in national carbon emission trading 11 . If the power generation industry is to be held responsible for the renewable energy quota system, the power generation enterprises will be pressurized and the pace of energy structure optimization slowed down because only a few entities will then be responsible for the quota system.…”

Section: Literature Reviewmentioning

confidence: 99%

Noncooperative multiagent game model for the electricity market on the basis of the renewable energy portfolio standard

Zhao

Fan

Hou

et al. 2022

Engineering Reports

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In China, after the revision of the renewable energy policy, transactions among the main parties involved in the electricity market are becoming increasingly complicated. Nevertheless, the impact of the Renewable Energy Portfolio Standard (RPS) on market equilibrium has not been studied so far. Hence, in this study, a noncooperative multiagent game model for the electricity market was developed on the basis of the recently released RPS and by considering various factors, such as green certificate transactions and the changing of the selling entities. The improved firefly algorithm was used to solve the model, and problematic gaming was analyzed empirically. Once the new RPS is implemented, the price of bound electricity will become higher than that of nonbound electricity, and the trading volume of bound electricity will increase. Because fossil energy producers will no longer be responsible for the electricity quotas, their electricity trading volumes will now be more related to the market demand than they were earlier. Renewable energy companies will increase their revenues by reducing their bound electricity sales. If the RPS increases the electricity quota ratios, the costs incurred by electricity sales companies and large power users will also increase, leading the electricity sales companies to reduce their electricity trading volumes. The study findings will help analyze the impacts of implementing the RPS and provide a basis and a reference for policymakers to make improvements to the standard in the future.

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Allowance allocation matters in China's carbon emissions trading system

Cited by 47 publications

References 29 publications

A Scientometric Analysis and Review of the Emissions Trading System

A Scientometric Analysis and Review of the Emissions Trading System

The effects and reacts of COVID-19 pandemic and international oil price on energy, economy, and environment in China

Noncooperative multiagent game model for the electricity market on the basis of the renewable energy portfolio standard

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