Browsing by Subject "Cap-and-trade"

Now showing 1 - 5 of 5

Open Access
Analyzing the Closure of Coal-Fired Power Plants in the Regional Greenhouse Gas Initiative States 2000-2015
(2017-04-28) Huetteman, Justine
The Regional Greenhouse Gas Initiative (RGGI) is a cap-and-trade program in the Northeast and Mid-Atlantic covering power sector carbon dioxide emissions. Many expect policies aimed at reducing carbon dioxide emissions, like RGGI, to cause coal-fired power plant closures as a way of complying with emissions reduction requirements, given the relatively higher carbon intensity of coal plants (as opposed to other fuel types) and the limited availability of carbon dioxide pollution control technology. This analysis qualitatively and quantitatively evaluates coal closures within the RGGI states between 2005 and 2015 to identify the extent to which RGGI caused these closures. A qualitative analysis of media reports and press releases surrounding the closures indicates that RGGI did not play a role in any of the closures; however, regression analysis suggests that RGGI did have a statistically significant impact in causing closures. The RGGI closures are compared to closures in the non-RGGI states as well as closures occurring before the policy was announced.
Open Access
Analyzing the Transportation and Climate Initiative Program Using an Integrated Assessment Model
(2021-04-30) Li, Zhuoran
The Transportation & Climate Initiative (TCI) is a cap-and-invest program that is designed to help the thirteen participating states reduce CO2 emissions; however, the anticipated electrification of the transportation sector can potentially interact with the Regional Greenhouse Gas Initiative (RGGI) market, a cap-and-trade system for CO2 emissions from electricity generation. Potential impacts include an increase in electricity prices and leakage of CO2 emissions to other sectors and states. This study utilized a human-earth systems model to investigate TCI’s regional emissions reduction potential and to quantify the impacts of the program under alternative assumptions. The results show that TCI would lower regional net CO2 emissions and increase market penetration of both heavy- and light-duty electric vehicles through 2050. The emissions reduction and changes in transportation fuel mix would be accompanied by an increase in the RGGI CO2 allowance price, as well as increases in the costs of electricity and on-road travel. In the freight sector, this resulted in a demand shift from trucks to trains and marine vessels. A portion of the CO2 reduction from on-road transportation was offset by the increases in emissions from non-road transportation and electricity generation. Pennsylvania, the only TCI state that does not currently belong to RGGI, experienced the highest increase in CO2 from the electric sector as well as the lowest percentage reduction of NOx emissions, reflecting its own additional electricity demands and higher electricity exports to RGGI states. Extending the declining RGGI and TCI cap trends through 2050 leads to higher CO2 and other air pollutant emissions reductions. In addition, it further facilitates the energy transition from carbon-based fuels to electricity in the on-road transportation sector. These results suggest that while TCI is effective at reducing regional CO2 emissions, additional measures may be needed to avoid regressively burdening low-income households with the added costs. This is one of the goals of the TCI reinvestments, an aspect of the policy that was not modelled here.
Open Access
Environmental Justice Considerations for the Implementation of the Regional Greenhouse Gas Initiative in North Carolina
(2021-04-30) Campton, Mike; Chan, Grace; Gilbert, Karen; Mulderrig, Conor; Wilkes, Audrey
Environmental organizations are pushing North Carolina to consider joining the Regional Greenhouse Gas Initiative (RGGI), which is a multi-state, market-based cap-and-invest program aimed at reducing carbon dioxide emissions from the power sector. Other states have used RGGI as a tool to mitigate climate change, however, a major concern about the program is how it addresses, or fails to address, environmental justice (EJ) concerns. As a result, we conducted research of the impacts from RGGI on EJ communities to inform potential avenues of action that our client, the North Carolina League of Conservation Voters (NCLCV), can take within the state. To inform our recommendations on key environmental justice issues, such as stakeholder participation, hotspots, and impacts on low-income households, we conducted informal interviews with state environmental agency representatives, environmental consultants, organizations with an EJ focus, and EJ community members, a literature review on the impact of cap-and-trade programs on EJ communities, as well as language and policy analysis of RGGI state environmental justice action. We presented NCLCV with a list of recommendations, potential steps for their implementation, and communication materials targeted to relevant stakeholders in North Carolina.
Open Access
Private Landowner Participation in the Carbon Market: Opportunities in North Carolina
(2008-04-21T21:24:48Z) Gray, Erin
In response to the growing awareness of climate change across the globe, innovative conservationists have begun employing market approaches to capture the true value of carbon emissions and encourage sequestration. The most widespread mechanism used to date, both domestically and internationally, is the carbon cap-and-trade system. The US carbon market is currently highly fragmented and mostly voluntary, but the growth of state actions, business participation, and growth in climate change market proposals in the 110th Congress all suggest that the US is headed towards a regulated carbon cap-and-trade system. Beyond reducing carbon emissions from sources, the market has the potential to promote conservation efforts and sustainable land-use practices on private lands by providing an additional revenue stream to private landowners. Without regulations, however, there are several barriers to entry that are preventing private landowner participation. These include: a lack of information of entry opportunities and characteristics of cap-and-trade proposals in the 110th Congress, cost constraints due to low market prices prevalent in US carbon markets, concerns about carbon market eligibility with other conservation funding programs, and concerns about entering into long-term conservation contracts required by market schemes to ensure permanence of sequestration activities. This report examines these barriers through 1) a scoping analysis of international and domestic carbon markets to determine North Carolina private landowner entry opportunities, 2) an assessment of eligibility criteria for relevant Federal and state conservation funding and other ecosystem service markets, and 3) an economic analysis of representative NC properties to determine income potential from carbon activities. Carbon market participation is shown to be a worthwhile endeavor for conservation-minded landowners. The modeled gains in income demonstrate a low but positive income gain if carbon market prices are to stay constant at the Chicago Climate Exchange’s current credit price of $2.05 per metric ton of CO2 equivalent. Using predictions from recent studies that have modeled trading price increases with cap-and-trade proposals in the 110th Congress, landowner gain is shown to sharply increase over a fifty year time horizon with a regulated carbon market. This study is useful for the North Carolina land protection community in encouraging private landowner participation in the carbon market. Policy recommendations are also provided to assist the state of North Carolina in moving forward with carbon market participation.
Open Access
Responses to EU Carbon Pricing: The Effect of Carbon Emissions Allowances on Renewable Energy Development in Advanced and Transitional EU Members
(2019-04-24) Dearing, Jack
Using electricity price, generation, installed capacity, and carbon price data from the European Union from January 2015 to December 2018, this study finds that the carbon pricing in the European Union Emissions Trading Scheme (EU ETS) incentivizes electricity sector carbon emission reductions through renewable energy deployment only for economically advanced EU members. Transitional economies show a weak to modest carbon emission increase despite a common carbon price. This study estimates an electricity supply curve, or merit order, for 24 EU ETS members using a Tobit regression model and analyzes changes in this curve using a linear bspline. These shifts provide insight into how carbon pricing affected energy generation, price, and CO2 emissions for two distinct categories of EU member states. The advanced category as a whole saw a strong electricity sector decrease in carbon emissions, both over time and from carbon pricing, while the transitional category as a whole saw a weak increase. This indicates that advanced EU members in Northern, Western, and Central Europe likely sold permits to transitional ones in Southern and Eastern Europe. While these findings may initially reflect the gains from trade of carbon emissions permits inherent in the European Union Emissions Trading Scheme’s design, the implications of how these two distinct groups have changed electricity generation present challenges to the ultimate long-term goal of EU-wide carbon neutrality by 2050, particularly in transitional economies’ electricity sectors.