Year: 2011
Type: report
Abstract: Combinations of various policy instruments to deal with the threat of cli-\nmate change are used throughout the world. The aim of this article is\nto investigate an electricity market with two di¤erent policy instruments,\nTradable Green Certi cates (TGCs) and CO2 emission allowances (an\nEmission Trading System, ETS). We analyze both the short- and long-\nrun e¤ects of a domestic market and a market with trade. We nd that\nincreasing the TGC quota obligation will decrease the electricity produced\nusing non-renewable sources as well as the long-run total production of\nelectricity. For the electricity produced using renewable energy sources,\nan increase in the quota obligation leads to increased production in al-\nmost all cases, with assumptions based on historical data. The impacts of\nthe ETS price on the electricity production are negative for all electricity\nproduction, which is surprising. This means that the combination of ETS\nand TGCs gives unexpected and unwanted results for the electricity pro-\nduction using renewable sources, since an increase in the ETS price leads\nto a decrease in this production.
Author: Anna Widerberg
Institution: University of Gothenburg
Language: English
Subfield: Economics and Econometrics
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W1595550678