The secondary benefits of climate change mitigation: an overlapping generations approach

We modify a model of climate and economy to address the effects of the reduction in atmospheric pollutants which occurs as a result of climate change mitigation policies. In particular, the reduction of sulphur dioxide (SO₂) emissions as a result of climate change policies leads to reduced statistical morbidity and infant mortality, but increased short term climate change. It remains the case, even with the consideration of secondary benefits, that there are welfare costs of GHG emission control to almost all working-age agents alive when the policies are imposed, which suggests that the consideration of secondary benefits alone may not be sufficient to provoke aggressive action on climate change. Olivier Bahn—Affiliated researcher: GERAD, Bahn acknowledges the support of NSERC. Andrew Leach—Affiliated researcher: CABREE, CIRANO, CIRPEE.     

The long-term impact of GHG reduction policies on global trade: A case study for the petrochemical industry

A systems engineering model has been developed for the global petrochemical industry, named FREAK (FoReign trade Effect Assessment Kit). FREAK has been developed for the analysis of the impact of CO₂ taxes on the international trade and the global production structure. A life cycle approach has been applied for 50 petrochemical products and a broad range of emission reduction strategies have been considered. The scope of the policies has been varied (which countries apply the tax) and the policy ambition has been varied (the tax level). The results show that the regional distribution of the petrochemical production will not change significantly in case global policies are introduced. However, the regional distribution will change significantly if only a limited number of industrialised countries introduce a tax. The regional impact of such a tax depends on the carbon accounting approach for intermediate petrochemical products trade. The impacts can even be positive for the industry within the policy region. The techno-economic potential for emission mitigation is significant, even from a global perspective. The physical production volume increases threefold between 1995 and 2025. In the base case (BC) without policies, emissions increase by 65% to 970 Mt CO₂ in 2025. Global greenhouse gas (GHG) policies could halve these emissions. A 20% reduction (approximately 200 Mt) can be achieved in case developing countries and oil exporting countries do not participate in emission reduction.     

A model for long-term global air quality prediction and development of efficient control strategies in Turkey

This paper presents an environmental model which differentiates fuel consumption by sectoral use and allows for the reduction of emissions by coupling different emission control technologies to energy conversion and end-use activities. The model can be coupled to any energy model for forecasting air pollutant emissions and developing efficient emission control strategies. An energy-economy module has been integrated into the model and an equilibrium solution for the three-component model is obtained by utility maximization. Effects of emission limits on energy activities and on macroeconomical variables are investigated by restricting total pollutant emissions to the standards of the European Community. Numerical results are presented in the form of long-term forecasts focusing on the pollutants SO₂ and NO_x. Emission control measures, implied from the model results, are discussed revealing an efficient emission control strategy.     

Cost-effective sulphur emission reduction under uncertainty

The problem of reducing SO₂ emissions in Europe is considered. The costs of reduction are assumed to be uncertain and are modeled by a set of possible scenarios. A mean-variance model of the problem is formulated and a specialized computational procedure is developed. The approach is applied to the trans-boundary air pollution model with real-world data.     

Development of an energy-emission model using fuzzy sets

In searching for cost-efficient strategies to reduce emissions from energy conversion, most western countries use energy-emission models. In these models, the whole energy conversion chain and possible future options for energy supply and emission reduction are mapped into a network of energy flows. Total discounted cost of energy supply and emission reduction is minimized under the restriction of maximum allowed emissions of SO₂, NO _x , or CO₂. The present paper extends one of these models to allow for fuzzy parameters. Such an extension appears to be useful when the data situation is weak. In this paper, a fuzzy linear program is developed, which has been applied to an energy-emission model of Lithuania.     

CO2 emissions trading planning in combined heat and power production via multi-period stochastic optimization

The EU emissions trading scheme (ETS) taking effect in 2005 covers CO₂ emissions from specific large-scale industrial activities and combustion installations. A large number of existing and potential future combined heat and power (CHP) installations are subject to ETS and targeted for emissions reduction. CHP production is an important technology for efficient and clean provision of energy because of its superior carbon efficiency. The proper planning of emissions trading can help its potential into full play, making it become a true “winning technology” under ETS. Fuel mix or fuel switch will be the reasonable choices for fossil fuel based CHP producers to achieve their emissions targets at the lowest possible cost. In this paper we formulate CO₂ emissions trading planning of a CHP producer as a multi-period stochastic optimization problem and propose a stochastic simulation and coordination approach for considering the risk attitude of the producer, penalty for excessive emissions, and the confidence interval for emission estimates. In test runs with a realistic CHP production model, the proposed solution approach demonstrates good trading efficiency in terms of profit-to-turnover ratio. Considering the confidence interval for emission estimates can help the producer to reduce the transaction costs in emissions trading. Comparisons between fuel switch and fuel mix strategies show that fuel mix can provide good tradeoff between profit-making and emissions reduction.     

Supporting hydrogen based transportation: case studies with Global MARKAL Model

Steadily growing prices of oil and emissions coming from conventional vehicles, might force a switch to an alternative and less polluting fuel in the coming future. In this article we analyze the potential influence of selected factors for successful market penetration of hydrogen fuel cell vehicles in hydrogen based private transportation economy. Using a world scale, full energy system, bottom-up, optimization model (Global MARKAL Model—GMM) we address the possibility of supporting the fuel cell vehicle technology to become competitive in the markets. In a series of optimizations we evaluate the potential influence of governmental supports and the internalization of externalities related to CO₂ and local pollution emissions originating from the transportation sector, as well as preferential crediting options and demonstration projects promoting fuel cell vehicles. The results suggest that the crucial element is the price of fuel cells and their further potential to reduce costs. This reduction of costs may be triggered by governmental support such as direct subsidies to fuel cells, preferential crediting options for the buildup of hydrogen infrastructure as well as penalization of emitters of CO₂ and/or local pollutants.     

机动车碳税政策下政府、企业与出行者的三方演化博弈模型研究

为促进机动车碳减排,缓解因尾气排放带来的大气污染,本文采用演化博弈理论探究机动车碳税政策下的决策行为。建立政府管理部门、汽车企业和出行者三方利益主体的演化博弈模型,并对模型的演化路径及演化规律进行理论与数值仿真。研究发现:降低机动车碳排放演化是政府、汽车企业和出行者三者博弈互动的结果;政府主动实施机动车碳税政策,能够促进另外两者选择低碳的策略;提高机动车碳税税额与对低碳行为的补贴,加快了汽车企业与出行者朝各自低碳策略演化的速度。     

Capturing climate’s effect on pollution abatement with an improved solution to the omitted variables problem

Climate greatly affects the SO₂ concentration abatement efforts of Mae Moh power plant which burns high sulfur content lignite in Northern Thailand. In summer months, hot air rising draws Mae Moh’s SO₂ emissions out of the Mae Moh valley. In contrast, temperature inversions in winter months prevent hot air in the valley from rising, resulting in the trapping and concentrating of SO₂ emissions in the valley. The climatic conditions that affect Mae Moh’s abatement efforts are so complex that adequately modeling them has been elusive. In this paper we use a new analytical technique, BD-RTPLS, which produces reduce form estimates while minimizing the influence of omitted variables, like climate. Using BD-RTPLS and monthly data, we tell Mae Moh how much electricity needs to be sacrificed from which generating units to most efficiently reduce SO₂ concentrations in any given month.     

环境治理政策的减排、增效与结构优化效果动态评价

为测度环境治理政策波动对产出、减排、要素配置、消费与产业结构的影响及其传导机制,将异质性消费偏好、产出差异性、环境效用和环境损失函数引入E-DSGE模型。政策强度分析发现,技术进步、排污税和消费税政策效果较强,环境控制和治污支出冲击效果较弱。政策效应分析发现,技术进步政策效应最优,能实现增产和减排双重目标,促进要素配置和居民消费、产出与消费结构改进;排污税和政府治污支出政策次优,能实现增产和减排的双赢目标,促进要素供给和产出结构清洁化,不利于消费提升和消费结构优化;环境控制与消费税政策效果最差,以牺牲产出实现减排,不利于要素配置,产出与消费结构改进效果较弱,消费税会抑制居民消费,但消费税政策效果随环境友好型家庭比例提升而加强。     

Modelling a sector undergoing structural change: The case of Danish energy supply

This paper examines structural change in the power and heat producing sector (energy supply) and its implications for the economy. An integrated approach is used to describe the interactions between this sector and the rest of the economy. Thus, a very detailed model of the sector for Denmark has been linked to a macroeconometric model of the Danish economy. It is argued that analysing sectors that undergo radical changes, for example the energy supply sector, should be undertaken by using a model that describes the technological and organisational changes in production along with implications for the demand of the produced goods. Environmental priorities and targets for emission reductions are important for defining energy policy in Denmark. As the energy supply sector at present is a major contributor to emissions of CO₂ and SO₂, knowledge of this sector is vital for reducing these emissions. It is shown that quite substantial emission reductions are possible without encountering a substantial negative impact on the economy. The reduction potential through such economic incentives as fuel taxes is shown to be very sensitive to the technology used at present and in the future. This study also emphasises that the large reduction potential of emissions from the energy supply sector is a one-time gain. Fuel switching and increasing use of wind power cannot be repeated. Scenarios carried out with the combined model show that emission reduction in the energy supply sector will decrease the share of this sector in total emissions remarkably, and that the importance of the sector as a key element in any overall emission reduction strategy will decline. This revised version was published online in June 2006 with corrections to the Cover Date.     

EVALUATING THE IMPACT OF ENVIRONMENTAL POLICY ON THE TREND BEHAVIOR OF US EMISSIONS OF NITROGEN OXIDES AND VOLATILE ORGANIC COMPOUNDS

The nature of this paper is a practical application of a proper time‐series methodology to evaluate policy impacts when there is uncertainty about the data being difference‐stationary (DS) or trend‐stationary (TS). We use this methodology to examine the trend behavior of two air pollutants, nitrogen oxides (NO_X) and volatile organic compounds (VOC). In particular, we concentrate on answering two questions. First, were there breaks in the trends of NO_X and VOC emissions around the same time environmental policies such as the Clean Air Act Amendments (CAAA) of 1970 were passed? And second, accounting for possible breaks are the US emissions of NO_X and VOC TS or DS? Our empirical results show a clear evidence of a trend shift in NO_X and VOC emissions at the time the CAAA of 1970 were passed, implying that this policy has been effective in reducing air pollution emissions, as well as additional breaks that correspond to other events and environmental policies before and after 1970. The unit root tests indicate that NO_X are DS irrespective of the number of breaks in the trend whereas results for VOC emissions depend on the number of breaks assumed.     

A-P-S组合策略的多重绩效及其“褪色”效应分析

为了降低城市交通拥堵及空气污染程度,本文在现有研究的基础上引入罚款政策,利用系统动力学方法原理构建了机动车污染物减排管控模型。通过仿真和比较分析来探索空气污染收费(Air pollution charging fee,简称APCF)、罚款(penalty)和补贴(subsidy)政策(简称A-P-S策略)的作用效果。研究结果表明:一方面,组合策略具有多重绩效,不但能够降低污染损失(经济-环境效益)、死亡人口的生命价值(社会-经济效益)、交通拥堵程度(社会效益)和机动车污染物总量(环境效益),而且能大大改善环境生态承载力(环境效益)和机动车非法出行增长量(社会安全绩效);另一方面,政策在实施过程中也会遇到一定的局限性,如初期的滞后性,后期的“褪色”效应和“反弹”效应,因此,从长期来看,需要及时调整组合方案。最后,根据仿真结果提出了相应的政策建议,进而为城市交通和环保等相关部门提供决策参考。     

碳减排补贴与碳税下的供应链碳减排决策优化与协调

针考虑碳税政策和政府对制造商的碳减排技术创新投入补贴,构建了供应链博弈模型,根据协调条件给出了相应的契约形式及参数。通过对供应链模型的求解,得到了碳税和碳减排技术创新投入补贴下的最优碳减排量和最优订货量。数值分析结果表明:碳减排技术创新投入的补贴比例变化对供应链的最优碳减排量、订货量及期望利润的影响有较大影响,而且是成正向变化关系,而且在其他参数不变及供应链碳减排量一定的情况下,碳税与碳减排补贴比例呈反向变化关系,进而可为政府碳减排补贴政策制定及供应链碳减排优化提供科学的决策依据。     

不确定环境下具有减排配额的PM2.5治理博弈与税收决策

由于雾霾治理遵循浓度控制原则,且跨界传输因子存在异质性,因此,要使各地区在追求减排成本最小化时又达到减排指标,中央政府仅实施税收政策并不能满足其收支平衡条件。基于此,本文将税收与减排配额相结合,以期实现中央政府收支平衡与优化各地区治理成本的双重目标。同时,本文以京津冀地区雾霾治理为实证分析对象,验证了具有减排配额的税收决策具有可实施性。     

A scavenging model analysis around a large coal-fired power plant in New Delhi with a particular reference to the scavenging action of the monsoonal rains

There have been reports in the recent past about the problem of SO₂ pollution over India. Some of them have even stated that corrosion of the Acropolis in Athens is now matched by the corrosion of the Taj Mahal in Agra. Mathematical models and experimental analyses have been undertaken to address the problem of SO₂ pollution over selected Metropolitan cities in India.An important feature revealed from these model studies is that most urban air quality models in India grossly over predict ambient SO₂ levels during the monsoon period. This is because washout calculation are not featured in these models. In this paper we have tried to demonstrate the efficacy of the southwest monsoon rains to a scavenge a soluble pollutant like SO₂ from an urban environment. India in general does not face the acid rain threat yet. However, results of rainwater analyses show that low pH of precipitation does occur at isolated pockets downwind of major industries and power plants. In this paper we have determined the extent of acidic deposition in the near field of a large coal-fired power plant in Delhi. SO₂ concentration profiles, with and without washout calculations have been shown. Probable periods of the year and the areas within the meteroplition regions of Delhi which could be worst affected by acid impaction have been identified on the basis of the model simulations with mean climatological data. Model computations show that maximum pollution is brought in to the city from this power plant during the month of October. The hourly GLC often exceeds 1000 μg m^-3 which is quite a close to the federal standard of 1100 μg m^-3; likewise the acid deposition flux is greatest during the month of August and is of the order of 50 μg m^-2 s^-1 at a downwind distance of 1 km.The nature of the washout coefficient during the monsoon pre and post monsoon periods in relation to the relative importance of the atmospheric variables concerned has been investigated. The role of individual monsoonal showers to scavenge SO₂ has been discussed.This is perhaps the first work of its kind from India wherein representative washout coefficients have calculated and subsequently featured as washout effects in an urban air pollution model. Results show that this parameter could be as high as 16.03 × 10^-5 s^-1 during August and as low as 1.1 × 10^-6s^-1 in April.     

低碳政策下考虑道路拥堵的多式联运路径选择问题

为明确低碳政策及道路拥堵对多式联运路径选择的影响,构建了不同碳排放政策下考虑道路拥堵的多式联运路径选择模型。模型在考虑拥堵对运输时间影响的基础上进一步量化其对系统碳排放的作用效果。针对此类整数规划模型,设计了基于保优策略和移民策略的遗传算法进行求解。最后,通过算例探讨强制排放、碳税、碳交易及碳补偿四种碳排放政策对多式联运减排、缓解拥堵及成本的影响。结果表明考虑道路拥堵对运输碳排放的影响可得到更加合理的路径决策,且以强制碳排放政策为主的多种政策组合能更好的降低碳排放、缓解道路拥堵并促进多式联运推广。本模型可为政府制定合理的多式联运低碳政策以及企业制定合理的路径决策提供理论依据。     

Unified account of gas pollutants and greenhouse gas emissions: Chinese transportation 1978–2004

To facilitate the aggregation of both quantity and quality of waste emissions, the concept of chemical exergy combining the first and second laws of thermodynamics is introduced for a unified account of gas pollutants and greenhouse gases, by a case study for the Chinese transportation system 1978–2004 with main gas pollutants of NO, SO₂, CO and main greenhouse gases of CO₂ and CH₄. With chemical exergy emission factors concretely estimated, the total emission as well as emission intensity by exergy of the overall transportation system and of its four modes of highways, railways, waterways and civil aviation are accounted in full detail and compared with those by the conventionally prevailing metrics of mass, with essential implications for environmental policy making.     

气候政策的经济环境效应分析与比较—基于碳税、许可交易和总量控制的动态微分博弈

基于产品差别化假设,建立双寡头动态微分博弈模型,比较碳税和许可交易以及总量控制3种气候政策的经济环境效应.研究发现,不同气候政策对两国的经济效应不同.进一步研究还发现,在企业产品差别化竞争时,从碳排放流量来看,碳税政策和许可交易政策与总量控制政策之间没有严格的优劣之分;碳排放存量对碳税政策最敏感.从碳存量对政策的边际影响来看,许可交易政策与总量控制政策是相同的,而碳税政策与之相反.当两国生产的产品完全同质时,从均衡碳排放流量和碳排放存量来看,许可交易政策最优,总量控制政策次之,碳税政策最差.若政府单纯以控制碳排放量为目的,许可交易政策是最佳选择.     

Survey of mathematical programming models in air pollution management

This paper surveys the current state of the literature in management science/operations research approaches to air pollution management. After introducing suitable background we provide some of the institutional and legal framework needed to understand the continuing regulatory efforts in United States. Attention is then turned to mathematical programming models ranging from fairly simple deterministic linear programs to quite sophisticated stochastic models which have appeared in the literature dealing with these topics. This is followed by extensions reflecting some of the work we have undertaken in association with the Texas Natural Resource Conservation Commission, a regulatory agency in Texas. Application and potential use of models is the central theme of this survey. Issues for future research are presented at the end and an extensive list of publications is provided in the references at the end of the article.Principal air quality issues of local, national, and international concern are listed below in increasing order of difficulty based on the number of different types of pollutants and problems in quantification of the risks the pollutants pose:

• 1.1. Stratospheric ozone depletion: one relatively easily controllable class of trace gases - ozone depleting chemicals, or ODCs, principally chloroflurocarbons (CFCs) — with relatively well quantified risks;
• 2.2. Criteria pollutants: six common pollutants — ozone (O₃), carbon monoxide (CO), sulfur dioxide (SO₂), nitrogen dioxide (NO₂), lead (Pb), and particulate matter less than 10 microns in size (PM10) — regulated since 1970 in the U.S. and presenting relatively well quantified risks;
• 3.3. Acid precipitation: two relatively easily controllable classes of trace gases — oxides of nitrogen (NO_x) and oxides of sulfur (SO_x) with relatively well quantified risks;
• 4.4. Global warming/climate change: a few difficult to control trace gases — principally carbon dioxide (CO₂), methane (CH₄), nitrous oxide (N₂O), and CFCs — with highly uncertain risks;
• 5.5. Toxics or HAPS (hazardous air pollutants): hundreds of types of gaseous chemicals and particles with uncertain risks;
• 6.6. Somewhat dated, but nevertheless useful, is the following reference: Glossary on Air Pollution (Copenhagen, World Health Organization, 1980).