Estimating the Marginal Abatement Cost of Carbon Emissions: A Non-Radial Efficiency Analysis

2014 ◽  
Vol 1073-1076 ◽  
pp. 2473-2476
Author(s):  
Li Wei Fan ◽  
Xun Zhou
Keyword(s):  
Carbon Emissions ◽  
Negative Relationship ◽  
Emission Trading ◽  
Weighted Average ◽  
Abatement Cost ◽  
Efficiency Analysis ◽  
Marginal Abatement Cost ◽  
Policy Implications ◽  
Analysis Technique ◽  
Trading Scheme

This paper employed a non-radial efficiency analysis technique, namely slacks-based measure, to calculate the marginal abatement cost of carbon emissions. The study was concerning ten manufacturing sectors that have been included in Shanghai’s pilot emission trading scheme. The empirical result shows the overall weighted average marginal abatement cost is 839.3 Yuan/ton. It also indicates that the marginal abatement cost has a negative relationship with carbon emissions. Additionally, the marginal abatement costs vary across the sample sectors. Policy implications are presented based on above results.

scholarly journals Does Emission Trading Boost Carbon Productivity? Evidence from China’s Pilot Emission Trading Scheme

2020 ◽  
Vol 17 (15) ◽  
pp. 5522 ◽  
Author(s):  
Di Zhou ◽  
Xiaoyu Liang ◽  
Ye Zhou ◽  
Kai Tang
Keyword(s):  
Carbon Emissions ◽  
Capital Investment ◽  
Building Materials ◽  
Emission Trading ◽  
Economic Transformation ◽  
Policy Implications ◽  
Difference In Difference ◽  
Trading Scheme ◽  
The Impact ◽  
Carbon Productivity

As the country with the largest carbon emissions globally, the effective operation of China’s carbon emissions trading scheme (ETS) is of great importance to the global community in terms of mitigating climate change. This paper considers China’s pilot ETS launched in 2013 as a quasi-natural experiment. Exploring provincial industrial-level data that are more in line with the ETS coverage, the difference-in-difference-in-difference (DDD) model is used to evaluate the impact of the ETS on carbon productivity. Considering different pilot regions and industries, we also analyze the heterogeneous effect of ETS. Moreover, the mediating effects of technical progress and capital investment are explored. We find that China’s pilot ETS boosted carbon productivity. Among pilot regions, the best policy effectiveness appeared in Beijing, while the weakest effectiveness appeared in Chongqing. Among the pilot industries, the pilot ETS had better effectiveness in petrochemical and electric power industries and weaker effectiveness in building materials and transportation industries. Additionally, the pilot ETS promoted carbon productivity through both technological progress and capital investment, and the former contributed more. Our findings can provide empirical references and policy implications for nationwide implementation of ETS to further promote low-carbon economic transformation.

scholarly journals European emission allowance and equity markets: evidence from further trading phases

2019 ◽  
Vol 36 (4) ◽  
pp. 616-636
Author(s):  
Murad Harasheh ◽  
Andrea Amaduzzi
Keyword(s):  
Time Series ◽  
Value Relevance ◽  
Risk Mitigation ◽  
Emission Trading ◽  
Weighted Average ◽  
Market Model ◽  
Emission Trading Scheme ◽  
Content Type ◽  
Emission Allowance ◽  
Trading Scheme

Purpose This paper aims to investigate the value relevance of the European Emission Allowance (EUA) return and volatility on the equity value of the top listed European Power Generation Firms for the three trading phases of the European Emission Trading Scheme. Design/methodology/approach The authors use the multifactor financial market model over the period 2005-2016 on daily basis for the return relevance relationship, whereas time series models such as autoregression moving average and generalized autoregressive conditional heteroskedasticity are applied on a weighted average portfolio of the sample firms to test serial correlation and volatility of returns. Findings The findings are novel in which a positive and significant relevance of EUA return on equity return is shown; however, a vanishing effect is seen as one moves to further trading phases. Another remarkable finding is that the return relationship remains constant until a certain level in EUA price then inverts. Finally, the authors present that EUA is considered a systematic factor as firm and country-specific features are not statistically significant. Practical implications At policy level, these findings signal policymakers for an appropriate design of the future trading phases in which they achieve the balance between public interests, as climate risk mitigation by reducing emissions, and the private interests of the market players to support innovative changes. Originality/value To the authors’ knowledge, this study would be the first to offer recent and comprehensive findings on the economic and financial implications of the European Emission Trading Scheme for the three trading phases. Additionally, the research offers time series robustness check besides the standard regression analysis and shows that there is an optimal EUA price that triggers polluters’ decision on emission and generation.

scholarly journals Carbon Communities and Hotspots for Carbon Emissions Reduction in China

2019 ◽  
Vol 11 (19) ◽  
pp. 5508
Author(s):  
Huang ◽  
Kelly ◽  
Lu ◽  
Lv ◽  
Shi ◽  
...  
Keyword(s):  
Carbon Emissions ◽  
Synergistic Effects ◽  
Emission Trading ◽  
Large Data ◽  
Electricity Sector ◽  
Emissions Reduction ◽  
Network Reduction ◽  
Detection Algorithms ◽  
Carbon Emissions Reduction ◽  
Trading Scheme

With China’s commitment to peak its emissions by 2030, sectoral emissions are under the spotlight due to the rolling out of the national emission trading scheme (ETS). However, the current sector policies focus either on the production side or consumption while the majority of sectors along the transmission were overlooked. This research combines input–output modelling and network analysis to track the embodied carbon emissions among thirty sectors of thirty provinces in China. Based on the large-data resolution network, a two-step network reduction algorithm is used to extract the backbone of the network. In addition, network centrality metrics and community detection algorithms are used to assess each individual sector’s roles, and to reveal the carbon communities where sectors have intensive emission links. The research results suggest that the sectors with high out-degree, in-degree or betweenness can act as leverage points for carbon emissions mitigation. In addition to the electricity sector, which is included in the national ETS, the study also found that the metallurgy and construction sectors should be prioritized for emissions reduction from national and local levels. However, the hotpots are different across provinces and thus provincial specific targeted policies should be formed. Moreover, there are nineteen carbon communities in China with different features, which provides direction for provincial governments’ external collaboration for synergistic effects.

scholarly journals Can Emission Trading Scheme Improve Carbon Emission Performance? Evidence From China

2021 ◽  
Vol 9 ◽  
Author(s):  
Yuhua Zheng ◽  
Xiaoyang Sun ◽  
Chenyu Zhang ◽  
Daojuan Wang ◽  
Ju Mao
Keyword(s):  
Carbon Emission ◽  
Emission Trading ◽  
Listed Companies ◽  
Policy Implications ◽  
Emission Trading Scheme ◽  
Emission Performance ◽  
The Difference ◽  
Reduce Emissions ◽  
Trading Scheme ◽  
The Impact

This paper explores the effect of China’s emission trading scheme (ETS) pilot policy implemented during 2013-2014 on carbon emission performance. Adopting the Difference-in-Difference (DID) model, we find that: 1) China’s ETS pilot policy can significantly improve the carbon emission performance of listed companies in the pilot provinces. 2) The heterogeneity analysis shows that the carbon emission performance of listed companies in the eastern coastal pilot areas has improved significantly, which is not significant in the central and western pilot areas. 3) We find that China’s ETS pilot policy can significantly improve innovation capabilities of listed companies, suggesting that innovation is a channel for the impact of the China’s ETS pilot policy on carbon emission performance in the pilot provinces. Overall, our study shows that ETS pilot policy has played a governance role in China and improved carbon emission performance. We further highlight some important policy implications with respect to helping companies save energy and reduce emissions, and promoting the further improvement of China’s ETS pilot policy.

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