Effects of Allowances Allocation Schemes on the Emissions Leakage and Contract Shuffling: Some Preliminary Results
This paper examines the effects of emissions allowances allocation schemes on the extent of the GHG (greenhouse gas) leakage and the contract shuffling.Two allocation methods are considered.Whereas grandfathering separates future allowances allocation from today”s decisions, the output-based approach links the future awarded allowances to today”s output level.The latter effectively subsidizes generators” production costs,encourages more output and consequently elevates GHG allowances prices in current period.In this paper, we first analyze the effect of output-based allocation on the leakage and shuffling using a stylized duopoly model, which abstracts from details of point-of-regulation.A single-stage computable model, which allows representing source, load-based and first-seller programs, is then applied to examine the implications.The latter model is equivalent to a two-stage formulation with perfect foresight.Our results suggest that the magnitude of GHG leakage is inversely associated with per MWh of the future allowances awarded for today”s output.The power prices under output-based approach could be either higher or lower compared to the grandfathering.
Yihsu Chen Andrew L.Liu
School of Engineering,School of Social Sciences,Humanities and Arts,and Sierra Nevada Research Insti Department of Applied Mathematics and Statistics,The Johns Hopkins University,Baltimore,MD 21218,USA
国内会议
台北
英文
91-111
2008-12-15（万方平台首次上网日期，不代表论文的发表时间）