Optimal Carbon Taxes for Emissions Targets in the Electricity Sector

Olsen, Daniel; Dvorkin, Yury; Fernández-Blanco, Ricardo; Ortega‐Vazquez, Miguel A.

doi:10.1109/tpwrs.2018.2827333

Cited by 64 publications

(27 citation statements)

References 36 publications

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“…Since the upper-level price-setting problem minimizes a single continuous variable (the tax rate), and the resulting emissions from the lower-level problem are monotonically non-increasing with respect to an increasing tax rate, the problem can be solved to within a specified tolerance by the bisection method, as shown in [29].…”

Section: Determining a Minimum Carbon Tax Using The Bisection Methodsmentioning

confidence: 99%

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Planning Low-Carbon Campus Energy Hubs

Olsen

Zhang

Chen

et al. 2019

IEEE Trans. Power Syst.

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Multi-energy systems can provide a constant level of service to end-use energy demands, while deriving delivered energy from a variety of primary/secondary energy sources. This fuel-switching capability can be used to reduce operating expenses, reduce environmental impacts, improve flexibility to accommodate renewable energy, and improve reliability.This paper presents four frameworks for incentivizing energy hub equipment investments for low-carbon operation targets. These frameworks vary in the measures taken to achieve lowcarbon operation (explicit constraint vs. carbon pricing) and in the relationship between the hub builder and operator (cooperative vs. uncoordinated). The underlying energy hub model upon which these frameworks are built is an enhanced greenfield model, introducing 'energy buses' to reduce dimensionality.A case study is conducted for a campus being designed in Beijing, and results from each framework are compared to illustrate their relative costs. When the operator cannot be trusted to cooperate in controlling emissions, the system must be 'overbuilt' with more expensive equipment to ensure emissions target are met. A taxation-based approach increases overall costs at moderate emissions targets, but this effect decreases at aggressive targets. This paper also compares the cost of less efficient institutional frameworks with the most efficient approach, i.e. cooperation between builder and operator with constraints on emissions.

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Section: Determining a Minimum Carbon Tax Using The Bisection Methodsmentioning

confidence: 99%

“…Eq. (27) constrains hub input flows based on grid connection capacity and time-varying power availability, while (28) relates hub output flows to end-use power demand and power exports and (29) ensures that power exports do not exceed the grid connection capacity. Eq.…”

Section: Energy Hub Model Formulationmentioning

confidence: 99%

Planning Low-Carbon Campus Energy Hubs

Olsen

Zhang

Chen

et al. 2019

IEEE Trans. Power Syst.

Self Cite

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“…Multi-period constraints in the system operator's problem (i.e. (1)-(3), (6)) are enforced cyclically; initial conditions are not assumed a priori, but assumed to reflect the end of the current day [33], and the net load in the first and last hours of the day are smoothed to avoid introducing unrealistic midnight ramps.…”

Section: Case Studymentioning

confidence: 99%

“…The dual problem of the TCED is given in (25)- (32), with the primal variables to which each dual constraint corresponds listed in parentheses. The strong duality constraint for the TCED problem is given in (33). Although this single-level equivalent contains bi-linear terms, Section A.2 demonstrates how a MILP approximation can be obtained, which can provide a lower-bound on the optimum.…”

mentioning

confidence: 99%

Profitable Emissions-Reducing Energy Storage

Olsen

Kirschen

2020

IEEE Trans. Power Syst.

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While energy arbitrage from energy storage can lower power system operating costs, it can also increase greenhouse gas emissions. If power system operations are conducted with the constraint that energy storage operation must not increase emissions, how does this constraint affect energy storage investment decisions? Two bi-level energy storage investment problems are considered, representing 'philanthropic' (profitability-constrained) and profit-maximizing storage investors (PhSI, PMSI). A MILP heuristic is developed to obtain good candidate solutions to these inherently MINLP bi-level problems.A case study is conducted on a 30% renewable system, with sensitivity analyses on the price of storage and the price of carbon emissions. Regardless of the emissions-neutrality constraint, a PhSI installs significantly more energy storage than a PMSI, increasing system flexibility. The effect of the emissions-neutrality constraint in the absence of a carbon price is to reduce the quantity of storage purchased and reduce annual system emissions (~3%), with only minor increases in overall cost (~0.1%).In cases with a carbon price, storage does not tend to increase emissions and the emissions constraint does not tend to decrease storage investment. The emissions-neutrality constraint is seen to deliver similar emissions reductions even in a system with much higher renewable penetration (46%).Index Terms-Energy storage, power system emissions, power system economics, storage expansion planning.

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“…The same conclusion is also obtained by Shu, Huang, Chen, Wang and Lai [85] in trade-old-for-remanufactured CLSC. Olsen, et al [97] mention that if a carbon tax is implemented through proper analysis of their impact, it can support government investments in projects that reduce emissions. With good pricing, companies may also be attracted to invest in carbon sequestration.…”

Section: Carbon Tax Policymentioning

confidence: 99%

The Design of Green Supply Chains under Carbon Policies: A Literature Review of Quantitative Models

Elomri

Pokharel

et al. 2019

Sustainability

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Carbon footprinting of products and services is getting increasing attention due to the growing emphasis on carbon related policies in many countries. As a result, many enterprises are focusing on the design of green supply chains (GSCs) with research on supply chains (SCs) focused not only on cost efficiency, but also on its environmental consequences. The review presented in this paper focuses on the implications of carbon policies on SCs. The concept of content analysis is used to retrieve and analyze the information regarding drivers (carbon policies), actors (for example, manufacturers and retailers), methodologies (mathematical modeling techniques), decision-making contexts (such as, facility location and order quantity), and emission reduction opportunities. The review shows a lack of emissions analysis of SCs that face carbon policies in different countries. The research also focuses on the design of carbon policies for emissions reduction in different operating situations. Some possible research directions are also discussed at the end of this review.

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Optimal Carbon Taxes for Emissions Targets in the Electricity Sector

Cited by 64 publications

References 36 publications

Planning Low-Carbon Campus Energy Hubs

Planning Low-Carbon Campus Energy Hubs

Profitable Emissions-Reducing Energy Storage

The Design of Green Supply Chains under Carbon Policies: A Literature Review of Quantitative Models

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