Advanced

Climate Policy and Industry-Effects and Potential Responses in the Swedish Context

Johansson, Bengt LU (2006) In Energy Policy 34(15). p.2344-2360
Abstract
Efficient policy instruments for reducing the emission of greenhouse gases are essential for the realization of a successful climate policy. General economic policy instruments have the potential for providing efficient emission reduction as they equalise marginal costs for emission reduction between different actors. They also provide incentives for a great variety of responses such as energy efficiency improvements, fuel substitution and reduced consumption of carbon intensive products. However, as a result of the fact that it has so far been impossible to implement policy instruments on a global scale, these instruments are often adapted in such a way that some of their potential advantages are eliminated.

In this paper the... (More)
Efficient policy instruments for reducing the emission of greenhouse gases are essential for the realization of a successful climate policy. General economic policy instruments have the potential for providing efficient emission reduction as they equalise marginal costs for emission reduction between different actors. They also provide incentives for a great variety of responses such as energy efficiency improvements, fuel substitution and reduced consumption of carbon intensive products. However, as a result of the fact that it has so far been impossible to implement policy instruments on a global scale, these instruments are often adapted in such a way that some of their potential advantages are eliminated.

In this paper the possibility of different policy instruments to contribute to reductions in industrial CO2 emissions, while preserving the competitiveness of industry, is evaluated theoretically. The consequences of increasing the cost of CO2 emission in various industrial sectors are also discussed. Attention is directed towards carbon taxes, emission trading, and regulation. CO2 taxes without tax reductions and emission trading with allocation through auctioning have theoretical advantages in a global climate regime but may lead to significant disadvantages if implemented in a single or a small groups of countries. Emission trading with free intensity-based allocation would in this case have a major advantage in combining incentives for emission reductions through efficiency improvements and fuel substitution, with little impact on production levels. (Less)
Please use this url to cite or link to this publication:
author
organization
publishing date
type
Contribution to journal
publication status
published
subject
keywords
carbon taxes, industry, emission trading
in
Energy Policy
volume
34
issue
15
pages
2344 - 2360
publisher
Elsevier
ISSN
1873-6777
language
English
LU publication?
yes
id
0ee89056-863a-4c85-bab2-aeafd3766aff (old id 604735)
date added to LUP
2007-11-23 18:35:06
date last changed
2016-04-16 10:55:12
@article{0ee89056-863a-4c85-bab2-aeafd3766aff,
  abstract     = {Efficient policy instruments for reducing the emission of greenhouse gases are essential for the realization of a successful climate policy. General economic policy instruments have the potential for providing efficient emission reduction as they equalise marginal costs for emission reduction between different actors. They also provide incentives for a great variety of responses such as energy efficiency improvements, fuel substitution and reduced consumption of carbon intensive products. However, as a result of the fact that it has so far been impossible to implement policy instruments on a global scale, these instruments are often adapted in such a way that some of their potential advantages are eliminated.<br/><br>
In this paper the possibility of different policy instruments to contribute to reductions in industrial CO2 emissions, while preserving the competitiveness of industry, is evaluated theoretically. The consequences of increasing the cost of CO2 emission in various industrial sectors are also discussed. Attention is directed towards carbon taxes, emission trading, and regulation. CO2 taxes without tax reductions and emission trading with allocation through auctioning have theoretical advantages in a global climate regime but may lead to significant disadvantages if implemented in a single or a small groups of countries. Emission trading with free intensity-based allocation would in this case have a major advantage in combining incentives for emission reductions through efficiency improvements and fuel substitution, with little impact on production levels.},
  author       = {Johansson, Bengt},
  issn         = {1873-6777},
  keyword      = {carbon taxes,industry,emission trading},
  language     = {eng},
  number       = {15},
  pages        = {2344--2360},
  publisher    = {Elsevier},
  series       = {Energy Policy},
  title        = {Climate Policy and Industry-Effects and Potential Responses in the Swedish Context},
  volume       = {34},
  year         = {2006},
}