Alternative standards and instruments for air pollution control in Poland

Like other Central European countries, Poland faces the twin challenges of improving environmental quality while also fostering sustainable economic development. In this study we examine the costs of different standards for air pollution control, and the cost savings from using incentive-based policy instruments in lieu of more rigid command-and-control policies. The comparisons are based on the results of a simulation model of energy use and air pollution control for the Polish economy over 1990–2015. The model simulates least-cost energy supply decisions under different environmental policy assumptions, the corresponding emissions, and the cost of achieving the specified policy objectives. The model results suggest that incentive-based policies will have efficiency gains over command policies that are at least worthy of consideration and may be quite substantial. The size of the gains in practice depends in part on how much flexibility is built into the command approach, e.g., capacity for intrafirm trading as well as alack of technology-specific requirements. To achieve these gains, an increase in the current levels of emissions fees is desirable both to strengthen abatement incentives and to improve the capacity of the Polish government to overcome past environmental damages. However, it seems highly unlikely in practice that fees could be raised to the levels necessary to meet current Polish emissions standards. To make further headway, an evolutionary approach to emissions trading patterned after (and profiting from the experience with) emissions trading in the U.S. seems useful. The program could start out relatively modestly and increase in ambitiousness as the Polish economic transition proceeds.     

Urban Structure and Environmental Externalities

The objective of this paper is to analyze policy design for air pollution management in the spatial context of urban development. We base our analysis on the paper of Ogawa and Fujita (Reg Sci Urban Econ 12:161–196, 1982), which offers a proper theoretical framework of non-monocentric urban land use using static microeconomic theory where the city structure is endogenous. First, we show that when households internalize industrial pollution in their residential location choice, spatialization within the city is reinforced. This impacts directly the emissions of greenhouse gases from commuting. Then, we analyze policy instruments in order to achieve optimal land use pattern when the policy maker has to manage both industrial and commuting related polluting emissions, that interact through the land market.     

Climate policy in Western Europe and avoided costs of air pollution control

Abatement of CO₂ emissions will be accompanied by reduced air pollutant emissions such as particulate matter (PM), SO₂, and NO_x. This, in turn, will reduce the need for end of pipe (EOP) pollution control technologies to meet future air quality targets. This dynamic could put more stringent air quality goals within reach, and increase the political feasibility of climate policy. This paper presents a CGE model that has been modified to include the emissions and EOP abatement of PM, SO₂, and NO_x from stationary sources in the EU-17. Emissions of pollutants are modeled as fixed-factor complementary inputs to their associated source. Abatement in each sector is modeled as a substitution between the pollutants and discrete abatement technologies, each of which is sector-specific and characterized by a marginal abatement cost and technical capacity constraint. Scenarios are run to 2020, to assess the costs and co-benefits of simultaneous air quality and climate policies. We find that under the Kyoto Protocol in 2010, the welfare cost of pollution control is reduced by 16% compared to the baseline, effectively offsetting the cost of CO₂ abatement by 15%. The co-benefit results depend heavily on policy choices, and their magnitude relative to total costs is likely to decline as greenhouse targets become more ambitious. In our scenarios, pollution control cost savings range from 1.3 to 20% in 2020, yielding a climate cost offset range of 0.2 to 3.9%. The CO₂ credit imports allowed by the EU via the Clean Development Mechanism (CDM) offer a total savings of $9.7bn in 2020, but only need to be compensated by an additional $0.3–0.4bn in domestic pollution control from stationary sources.     

Can Trade Be Good for the Environment?

We analyze the impact of trade in a differentiated good on environmental policy when there is local and transboundary pollution. In autarky, the (equivalent) pollution tax is set equal to the marginal damage from own emissions. If the strategic policy instrument is a tax, leakage occurs under trade and tends to lower the tax. The net terms of trade effect, due to the exportable and importable varieties of the differentiated good, tends to increase the tax. We derive conditions under which pollution taxes under trade are higher than the marginal damage from own emissions, i.e., higher than the Pigouvian tax and than that under autarky. Then, pollution falls under trade relative to autarky. When countries use quotas/permits to regulate pollution, there is no leakage, while the net terms of trade effect tends to make pollution policy stricter. The equivalent tax is always higher than the marginal damage from own emissions, i.e., always higher than the Pigouvian tax and than that under autarky; hence, pollution always falls under trade. Our analysis provides some insight into the findings in the empirical literature that trade might be good for the environment.     

Towards a sustainable and efficient use of manure in agriculture: The Dutch case

Rapid increases in livestock production in the Netherlands have changed manure from a valuable input into a mere waste product. This is especially true for the southern and eastern parts of the country, where specialized pig and poultry farms have concentrated on sandy soils. As these farms generally own very little land, they largely depend on imported feedstuffs. As a consequence, manure is applied to the land in such large quantities that serious environmental problems have resulted: (1) eutrophication of surface water by phosphate emissions; (2) pollution of groundwater by nitrate emissions; and (3) acidification by ammonia emissions.In the last few years the Dutch government has developed a manure policy to counteract these effects. Our analysis of that policy has revealed at least three fundamental defects, which render the manure policy ineffective and inefficient. In this paper proposals are made to remove the defects in current manure policy. Much attention is paid to the problem of designing a mixture of policy instruments which is both effective as well as efficient in limiting the environmental problems caused by manure. It is shown that the use of financial incentives in regulation can substantially improve the efficiency of the manure policy. Finally, the main economic consequences of the proposed policy are examined for the public sector as well as for the agricultural sector.     

排污权交易政策对企业环保行为的传导机制研究

从企业的目标函数和生产函数两个角度出发,分析了排污权交易政策对企业环保行为的影响机理,并讨论了排污权交易政策下企业的环保行为选择。研究发现：排污权交易政策通过影响企业的资本要素分配,从而影响企业环境资源的使用成本,进而影响企业的生产和环保行为决策;在排污权交易政策的作用下,企业主要采取不同的污染治理投资策略来满足该政策的规制。基于此,政府应制定配套政策和措施,引导企业沿着“政策遵从—环保投资策略—新环保技术采纳”的行为选择路径进行行为决策,以实现排污权交易政策的目标。     

EVOLUTION OF THE OIL MARKET AND ENERGY SECURITY POLICY

This paper examines a number of issues that affect the U.S. government's role in responding to future energy crises. The paper argues that we do not adequately understand why oil prices behaved as they did during the two price shocks of the 1970s, and that the market has evolved in ways that will alter future price behavior compared with that of the past. Consequently, it is unwise to formulate energy policies on the basis of specific forecasts of market conditions, or to plan to fight repetitions of past oil market crises. To be effective, energy security policy must be designed to motivate the private sector and other governments to respond in ways consistent with policy objectives.     

Estimating direct and indirect rebound effects for U.S. households with input–output analysis. Part 2: Simulation

This is the second part of a two-part paper that integrates economic and industrial ecology methods to estimate the indirect rebound effect from residential energy efficiency investments. We apply the model developed in part one to simulate the indirect rebound, given an estimate of the direct rebound, using a 2002 environmentally-extended input–output model and the 2004 Consumer Expenditure Survey (in 2002$) for the U.S. We find an indirect rebound of 5–15% in primary energy and CO₂e emissions, assuming a 10% direct rebound, depending on the fuel saved with efficiency and household income. The indirect rebound can be as high as 30–40% in NO_x or SO₂ emissions for efficiency in natural gas services. The substitution effect modeled in part one is small in most cases, and we discuss appropriate applications for proportional or income elasticity spending assumptions. Large indirect rebound effects occur as the U.S. electric grid becomes less-carbon intensive, in households with large transportation demands, or as energy prices increase. Even in extreme cases, there is limited evidence for backfire, or a rebound effect greater than 100%. Enacting pollution taxes or auctioned permits that internalize the externalities of energy use would ensure that rebound effects unambiguously increase consumers' welfare.     

Reducing Greenhouse Gas Emissions in Fisheries: The Case of Multiple Regulatory Instruments in Sweden

The fishing sector is a candidate for efficient climate policies because it is commonly exempted from greenhouse gas taxes and the fundamental problem of using a common pool resource is far from optimally solved. At the same time, fisheries management has other objectives. This study uses Swedish fisheries to analyse how the fishing sector and its climate impact are affected by regulations aiming at: (1) solving the common pool problem (2) taxing greenhouse gas emissions and (3) maintaining small-scale fisheries. The empirical approach is a linear programming model where the effects of simultaneously using multiple regulations are analyzed. Solving the common pool problem will lead to a 30 % reduction in emissions and substantially increase economic returns. Taxing greenhouse gas emissions will further reduce emissions. Policies for maintaining the small-scale fleet will increase the size of this fleet segment, but at the cost of lower economic returns. However, combining this policy with fuel taxes will reduce the size of the small-scale fleet, thus counteracting the effects of the policy. If taxation induces fuel-saving innovations, it is shown that this will affect not only emissions and fleet structure, but also quota uptake.     

Greenhouse gas policy and California electricity prices

California has adopted a policy of mandatory reductions in greenhouse gas (GHG) emissions to 1990 levels by the year 2020. (California Legislature (2006) Assembly Bill 32, the Global Warming Solutions Act of 2006, California Air Resources Board (2008) Climate change draft scoping plan, Sect. 2) Electricity utilities will need to recover related expenses, such as for the purchase of emissions permits. Economists often assume that raising usage prices for the commodity is the best way to recoup such expenses. However, regulated usage prices to California residential customers already exceed the cost of electricity generation plus a plausible externality cost for carbon dioxide (CO₂) emissions. Instead, recovering compliance expenses through usage insensitive charges could avoid causing unnecessary economic harm to consumers.     

SCALE EFFECT VERSUS INDUCED POLICY RESPONSE IN THE ENVIRONMENTAL KUZNETS CURVE: THE CASE OF U.S. WATER POLLUTION

The environmental Kuznets curve (EKC) could arise from the scale effect in abatement technology as emphasized by Andreoni and Levinson (2001) or from the induced policy response as suggested by Grossman and Krueger (1995). This paper incorporates these two contrary views into a model and quantitatively evaluates their relative importance in shaping the EKC of U.S. water pollution. Our main findings include: (a) some scale effect in abatement technology must exist, otherwise the turning point of the EKC will be unreasonably high; (b) the scale effect alone is not sufficient to explain the practical occurrence of the turning point of the EKC; and (c) the scale effect features critically in the induced policy response as well. (JEL H41, O40, Q20)     

Optimal containment and policy differentiation under unilateral climate policy

Abstract Without a broad international agreement, climate policy is less effective, owing to carbon leakage. We investigate whether this negative effect can be addressed by partially containing the policy’s effects to intermediate goods sectors, such as electricity or transportation services. We use a three‐sector model to study a policy that taxes emissions caused by intermediate goods production while subsidizing the intermediate good. We characterize the optimal containment policy for combating carbon leakage and show that it complements the concept of policy differentiation.     

Corporate pollution control strategies and labor demand: evidence from China’s manufacturing sector

The loss of employment is an essential issue that looms large in policy debates on pollution control. This paper estimates the impact of pollution reduction on labor demand in China’s manufacturing sector in the period 2001–2007. We conduct this research by using a sample with unbalanced panel data matched from two unique datasets of environmental statistics and an industrial economic database. Using the environmental performance of peer firms as the instrumental variable, our overall results show that improvements in environmental performance through reductions in \( SO _2\) emissions and COD emissions led to a statistically significant reduction in employment. On average, a 1% reduction in \( SO _2\) (COD) emissions causes a reduction in labor demand of approximately 0.018–0.019% (0.012–0.013%). We complement existing studies by carefully examining the impacts of firms’ different abatement strategies on labor demand. We find that pollution reduction through pollution prevention has substitutive effects on employment and that pollution reduction through pollution control at the end of the production process may require additional workers and thus has positive but not significant effects on labor demand. Finally, pollution control has heterogeneous effects on labor demand by different types of polluting firms (e.g., ownership, region, and industry).     

The income–pollution relationship and the role of income distribution: An analysis of Swedish household data

The main purpose of this study is to analyze the relationship between pollution and income at household level. The study is motivated by the recent literature emphasizing the importance of income distribution for the aggregate relation between pollution and income. The main findings from previous studies are that if the individual pollution–income relationship is non-linear, then aggregate pollution for, say, a whole country, will depend not only on average income, but also on how income is distributed. To achieve our objective we formulate a model for determining the choice of consumption of goods in different types of household. Furthermore we link the demand model to emission functions for various goods. The theoretical analysis shows that without imposing very restrictive assumptions on preferences and the emission functions, it is not possible to determine a priori the slope or the curvature of the pollution–income relation. The empirical analysis shows that, given the model used, the pollution–income relation has a positive slope in Sweden and is strictly concave for all three pollutants under study (CO₂, SO₂, NO_x), at least in the neighbourhood of the observed income for an average household. We also show that altering the prevailing income distribution, holding average income constant, will affect aggregate emissions in the sense that an equalization of incomes will give rise to an increase in emissions. One implication is then that the development of aggregate pollution due to growth depends not only on the income level, but also on how growth is distributed.     

Policy Uncertainty about Australia's Carbon Price: Expert Survey Results and Implications for Investment

Australia's carbon‐pricing policy remains in doubt due to a lack of bipartisan political support. A survey of Australian‐based carbon‐pricing experts demonstrates profound policy uncertainty: 40 per cent of respondents expect the current carbon‐pricing mechanism to be repealed, but 80 per cent expect that there will be a carbon price in 2020. The forward price curve is U‐shaped and has great variance, with the 60 per cent confidence interval spanning from zero to A$25/t in 2020. Carbon policy uncertainty causes large excess costs in Australia's energy sector and may result in delay and diversion of investment.     

Carbon Dioxide Emissions in the U.S. Economy: A Structural Decomposition Analysis

This paper provides an empirical analysis of the impact of various influences on carbon dioxide emissions. It incorporates methodological refinements of input-output structural decomposition analysis, which is the examination of economic change by means of a set of comparative static variations in key parameters of I-O tables. The analysis is performed using a two-tiered KLEM model, which allows for estimation of substitution and technological change effects within and between input aggregates. The model is used to decompose the sources of change in CO₂ emissions in the U.S. over the 1972–82 timeframe using hybrid energy/value tables for the initial and terminal years. Results show the significant effect of substitution within the energy sector and between energy and other inputs as the leading causes of the decline in carbon dioxide emissions.     

The Ancillary Benefits from Climate Policy in the United States

This study investigates the benefits to human health that would occur in the United States (US) due to reductions in local air pollutant emissions stemming from a federal policy to reduce greenhouse gas emissions. In order to measure the impacts of reduced emissions of local pollutants, this study considers the Warner-Lieberman bill (S.2191) of 2007 and the paper considers the impacts of reduced emissions in the transport and electric power sectors. This analysis provides strong evidence that climate change policy in the US will generate significant returns to society in excess of the benefits due to climate stabilization. The total health-related co-benefits associated with a representative climate policy over the years 2010–2030 range between 103 billion and103 billion and 1.2 trillion in present value terms. Much of the co-benefit stems from between 32,000 and 189,000 avoided premature mortalities associated with exposure to PM_2.5 and O₃. Most of the co-benefits are due to reduced emissions of SO₂ from coal-fired power plants since these are an important contribution to ambient concentrations of PM_2.5. Among the most important determinants of co-benefits is the relationship between climate policy and existing policies governing SO₂ discharges from coal-fired power generation capacity. If SO₂ emissions are permitted to remain at current levels, total co-benefits are cut by 65%. We find that the co-benefit per ton of CO₂ emissions ranges between 1 and1 and 77 depending on modeling assumptions and year.     

Environment,Directed Technical Change and Economic Policy

We study the effects of an economic policy in an endogenous growth general equilibrium framework where production of consumption goods requires two resource inputs: a polluting non-renewable resource and a non-polluting labour resource. The use of the former contributes to the accumulation of pollution in the atmosphere, which affects welfare. There is a specific research sector associated with each of those resources. We provide a full welfare analysis, and we describe the equilibrium paths in a decentralized economy. We go on to study the effects of three associated economic policy tools: a tax on the polluting resource, and two research subsidies. We show that the optimal environmental policy has two main effects; it delays the extraction of the resource and with it the level of polluting emissions and it reallocates research efforts, decreasing the amount put into “grey” research to the benefit of “green” research. We also show that the environmental policy is grey-biased in the short-term, and green-biased in the long-term. Finally, we compute the optimal values for these tools.      

城镇化、城乡消费比例和结构对居民消费间接CO2排放的影响*

本文利用投入-产出分析法计算了我国居民消费间接CO2排放量,并应用结构分解分析（SDA）方法分析了城镇化、城乡消费比例、消费结构等因素对居民消费间接CO2排放的影响。研究结果发现：（1）城镇化的扩张和消费结构的升级是增加我国居民消费间接CO2排放的重要因素,尤其是食品、居住和交通通讯是导致居民消费间接CO2排放的主要部门;（2）城乡消费比例和排放强度对居民消费间接CO2排放具有明显的抑制作用;（3）人均消费的提高对居民消费间接CO2排放增长贡献最大。最后,本文基于实证结果提出了减少我国居民消费间接CO2排放的政策建议。     

Spatial organization, transport, and climate change: Comparing instruments of spatial planning and policy

Approaching the analysis of climate policies from a spatial organization perspective is necessary for realizing both efficient and effective mitigation of greenhouse gas (GHG) emissions. In particular, it allows assessing the potential contribution of specific mechanisms of spatial organization and related spatial planning and policy to climate policy goals. So far, this spatial organization angle of climate policy has hardly received attention in the literature. The main sector significantly contributing to GHG emissions and sensitive to spatial organization and planning is urban transport. A qualitative evaluation of the available spatial organization policy options is provided, on the basis of four standard ‘E criteria’ and a decomposition of CO₂ emissions.