Reconciling Carbon Pricing and Energy Policies in Developing Countries

Gouvello, Christophe De; Finon, Dominique; Guigon, Pierre

doi:10.1596/33490

Cited by 5 publications

(5 citation statements)

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“…Consequently, coal power plants with the highest emissions may become marginal plants. This may increase the average energy price, having a negative economic and social impact (De Gouvello et al, 2019). To help to mitigate this negative impact for consumers, proper measures may be needed such as financial support or subsidies to low-income households.…”

Section: G Price Control and Standard Carbon Taxmentioning

confidence: 99%

“…Carbon pricing policies, such as emission trading systems, increase customers' energy prices if the cost of carbon is passed-through to customer's energy bills in liberalized markets (De Gouvello et al, 2019, Marchán et al, 2017. This may also conflict with energy policies seeking consumer protection through price controls (De Gouvello et al, 2019).…”

Section: Introductionmentioning

confidence: 99%

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Effect of Combining Carbon Policies and Price Controls in Cross-Border Trade of Energy on Renewable Generation Investments

Muñoz¹,

H.²,

Sauma³

2024

The Energy Journal

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In this paper, we investigate the combined effect of carbon policies and price controls in cross-border trade of electricity on power generation investments. It has been shown that price controls in cross-border trade of electricity may negatively affect renewable energy investments. However, the assessment of the impact of the simultaneous adoption of carbon policies and energy price controls has still not been addressed. Assessing this interaction is important to find out whether carbon policies can offset the negative impact of price controls on renewable energy investments or not. Results show that carbon policies can partially offset the negative impact of price controls, and that cap-and-trade programs are more effective to prevent this negative impact than carbon taxes. On the other hand, high levels of carbon taxes combined with price control regulation may increase renewable capacity investments, but without completely offsetting the negative effect of the price controls.

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Section: G Price Control and Standard Carbon Taxmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Effect of Combining Carbon Policies and Price Controls in Cross-Border Trade of Energy on Renewable Generation Investments

Muñoz¹,

H.²,

Sauma³

2024

The Energy Journal

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“…The cost of carbon effectively faced by companies is often complex, combining price and non-price regulations in different sectors (De Gouvello et al, 2020;Newbery et al, 2019;Stiglitz, 2019). Large discrepancies exist between carbon prices that are explicitly defined by carbon taxes or emissions trading systems, and prices that are implicitly derived from the application of other regulations.…”

Section: The Adoption Of Internal Carbon Pricesmentioning

confidence: 99%

“…Aligning climate and energy price and non-price regulation (e.g. standards, innovation support) is important for a long-term strategy on climate mitigation that can pave the way to the emergence of a carbon pricing in society (De Gouvello et al, 2020;Finon, 2019;Stiglitz, 2019), and companies may anticipate a future stringent carbon policy. Firms tend to react differently to carbon policy complexity (Chen et al, 2018).…”

Section: The Adoption Of Internal Carbon Pricesmentioning

confidence: 99%

National Climate Policies and Corporate Internal Carbon Pricing

Bento¹,

Gianfrate²,

Aldy³

2021

The Energy Journal

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While national governments pledged to reduce their greenhouse gas emissions under the Paris Agreement, delivering on these aims will require significant changes in the activities of major sources of emissions such as companies. To drive such changes, companies will need to consider carbon emissions as a cost of production and many companies have begun doing so through internal carbon pricing. By employing data from the Carbon Disclosure Project, we evaluate how national carbon pricing policies influence firm-level internal carbon pricing and corporate emission targets. We find that firm-level internal carbon prices are significantly higher in countries explicitly pricing carbon through tax and/or cap-and-trade programs. These findings shed light on how companies are factoring climate change in their decision-making and on the drivers that can contribute to the generalization of climate pricing in the economy.

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“… 1 Other possible specificities of developing economies, which may have implications for the design or implementation of ETSs, include poor statistical data, lack of policy coordination, ineffective law enforcement, etc. Arguably, the specific design of ETSs for developing economies is an underdeveloped research area (Boute, 2017; Acworth et al ., 2018; De Gouvello et al ., 2019; Goulder et al ., 2019). …”

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confidence: 99%

The EU ETS and its companion policies: any insight for China's ETS?

et al. 2021

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This paper analyses the role that companion policies have had in the reduction of emissions regulated by the EU Emissions Trading System (EU ETS) and the related policy interactions, with a view to identifying relevant insights for China's forthcoming Emissions Trading System (ETS). The investigation rests on: (a) the observation of the EU's and China's ETSs and policy mixes; (b) economic theory concerning companion policies and ETS design; and (c) empirical ex-post evidence from the EU ETS. Three main conclusions emerge from the analysis. First, China's ETS, while not imposing a fixed cap on emissions, will not be immune to waterbed effects of companion policies. Second, the European experience stresses the importance of making explicit the objectives pursued by companion policies, and of balancing policies for innovation and policies for adoption of low-carbon technologies. Third, in the presence of a major market surplus, only permanent adjustments to allowance supply can be effective in raising prices.

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Reconciling Carbon Pricing and Energy Policies in Developing Countries

Cited by 5 publications

References 0 publications

Effect of Combining Carbon Policies and Price Controls in Cross-Border Trade of Energy on Renewable Generation Investments

Effect of Combining Carbon Policies and Price Controls in Cross-Border Trade of Energy on Renewable Generation Investments

National Climate Policies and Corporate Internal Carbon Pricing

The EU ETS and its companion policies: any insight for China's ETS?

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