Estimating the Marginal Abatement Cost Curve of CO2 Emissions in China: Provincial Panel Data Analysis

Du, Limin; Hanley, Aoife; Wei, Chu

doi:10.1016/j.eneco.2015.01.007

Cited by 85 publications

(37 citation statements)

References 66 publications

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“…In 2011, the MACs deviate from about 0 to 15,000 CNY/ton CO2, with the majority of the estimates clustering around the 9000 CNY/ton CO2 mark. Different from previous studies [23,42], the rightward shift of kernel density curves is not obvious enough in our research. It is co-determined by two major opposite effects.…”

Section: Macs In Industrial Levelcontrasting

confidence: 48%

“…Furthermore, adopting this MACC aligns our analysis with those carbon intensity reduction policies in China [23].…”

Section: Allocation Scheme Of Co 2 Abatementmentioning

confidence: 92%

“…Substituting carbon intensity for absolute quantity will not affect our results. Furthermore, adopting this MACC aligns our analysis with those carbon intensity reduction policies in China [23]. Based on the MACC, we can measure the optimal allocation scheme of CO2 abatement in every industry to minimize the total abatement cost under the nationwide constraint of carbon emissions intensity.…”

Section: Allocation Scheme Of Co 2 Abatementmentioning

confidence: 99%

“…The distance function was first proposed for the analysis of shadow prices by Färe et al [19][20][21][22], which can be regarded as an analytical framework consisting of a sequence of models. Classified by different estimation methods, two estimation methods, namely parametric and nonparametric ones, have been widely applied to estimate distance function [23].…”

Section: Literature Reviewmentioning

confidence: 99%

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Marginal Abatement Cost of CO2 in China Based on Directional Distance Function: An Industry Perspective

Xiao

Niu

et al. 2017

Sustainability

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Industrial sectors account for around 70% of the total energy-related CO 2 emissions in China. It is of great importance to measure the potential for CO 2 emissions reduction and calculate the carbon price in industrial sectors covered in the Emissions Trading Scheme and carbon tax. This paper employs the directional distance function to calculate the marginal abatement costs of CO 2 emissions during 2005-2011 and makes a comparative analysis between our study and the relevant literature. Our empirical results show that the marginal abatement costs vary greatly from industry to industry: high marginal abatement costs occur in industries with low carbon intensity, and vice versa. In the application of the marginal abatement cost, the abatement distribution scheme with minimum cost is established under different abatement targets. The conclusions of abatement distribution scheme indicate that those heavy industries with low MACs and high carbon intensity should take more responsibility for emissions reduction and vice versa. Finally, the policy implications for marginal abatement cost are provided.

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Section: Macs In Industrial Levelcontrasting

confidence: 48%

“…Furthermore, adopting this MACC aligns our analysis with those carbon intensity reduction policies in China [23].…”

Section: Allocation Scheme Of Co 2 Abatementmentioning

confidence: 92%

Section: Allocation Scheme Of Co 2 Abatementmentioning

confidence: 99%

Section: Literature Reviewmentioning

confidence: 99%

See 2 more Smart Citations

Marginal Abatement Cost of CO2 in China Based on Directional Distance Function: An Industry Perspective

Xiao

Niu

et al. 2017

Sustainability

View full text Add to dashboard Cite

show abstract

“…As a major greenhouse gas (GHG) emitter, China has worked hard to cut GHG emissions, and incorporated a series of explicit goals into the Chinese Five-Year Plan [1]. For instance, the latest target of controlling climate change was identified in 2015, when the Chinese government made a commitment to reduce 60%-65% of carbon intensity by 2030 relative to the level in 2005 and reach its peak of carbon emission in 2013 or earlier [2].…”

Section: Introductionmentioning

confidence: 99%

Impacts on CO2 Emission Allowance Prices in China: A Quantile Regression Analysis of the Shanghai Emission Trading Scheme

Zhang

2016

Sustainability

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A pilot regional carbon emission trading scheme (ETS) has been implemented in China for more than two years. An investigation into the impacts of different factors on carbon dioxide (CO 2 ) emission allowance prices provides guidance for price-making in 2017 when the nation-wide ETS of China will be established. This paper adopts a quantile regression approach to estimate the impacts of different factors in Shanghai emission trading scheme (SH-ETS), namely, economic growth, energy prices and temperature. The empirical analysis shows that: (i) the economic growth in Shanghai leads to a drop in the carbon allowance prices; (ii) the oil price has a slightly positive effect on the allowance prices regardless of the ordinary least squares (OLS) or quantile regression method; (iii) a long-run negative relationship exists between the coal price and the Shanghai emission allowances (SHEA) prices, but a positive interaction under different quantiles, especially the 25%-50% quantiles; (iv) temperature has a significantly positive effect at the 20%-30% quantiles and a conspicuous negative impact at the right tail of the allowances prices.

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China's manufacturing firms' willingness to pay for carbon abatement: A cost perspective

Shi

Wang

et al. 2023

Bus Strat Env

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The existing studies of emissions reduction focus mainly on the technical potential and abatement costs while overlooking firms' willingness to pay (WTP) for emissions reduction. Yet WTP is a key parameter in a firm's decision to carry out emissions reduction while maximizing its profits. This paper estimates China's manufacturing industry (CMI) firms' maximum WTP for carbon abatement—defined as the cumulative product between the marginal abatement cost and corresponding abatement potential—using a large sample from a data envelopment analysis model. The results show that (a) the maximum WTP is significantly constrained by an isocost carbon abatement curve at RMB 8.65 million for the representative CMI firm; (b) the representative firms' WTP for carbon abatement varies among the sub‐sectors; and (c) profitability and production scales both positively affect firms' WTP for carbon abatement in all of CMI sub‐sectors, while innovation investment has a negative effect. The results suggest that the cost of carbon reduction technology for CMI firms should be below RMB 8.65 million for a representative CMI firm. The government should formulate subsidies or tax relief policies to help firms reduce their abatement costs. Further, the division of tasks in different sub‐sectors, between carbon emissions reduction on the one hand, and ongoing innovation on the other, should be clearly distinguished by policy bias to promote the transformation of industrial structure.

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Estimating the Marginal Abatement Cost Curve of CO2 Emissions in China: Provincial Panel Data Analysis

Cited by 85 publications

References 66 publications

Marginal Abatement Cost of CO2 in China Based on Directional Distance Function: An Industry Perspective

Marginal Abatement Cost of CO2 in China Based on Directional Distance Function: An Industry Perspective

Impacts on CO2 Emission Allowance Prices in China: A Quantile Regression Analysis of the Shanghai Emission Trading Scheme

China's manufacturing firms' willingness to pay for carbon abatement: A cost perspective

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