Carbon pricing is on the rise, as evidenced, for example, by the European Commission's proposal to extend the trade in carbon emissions to the building and transport sectors. An important feature of carbon pricing is that it generates revenues which can be rebated to households. Rebating the...

A small open economy operates a carbon emission trading scheme and subsidizes green energy. Taking cap-and-trade as given, we seek to explain the subsidy as the outcome of a trilateral tug of war between the green energy industry, the black energy industry and consumers. With parametric...

This paper aims at characterizing the conditions of wind power deployment in order to infer a carbon price level that would provide wind power with comparable advantage over fossil fuel technologies as effective wind support policies. The analysis is conducted on Danish data from 2000 to 2010,...

The price of EU allowances (EUAs) in the EU Emissions Trading Scheme (EU ETS) fell from almost 30€/tCO2 in mid-2008 to less than 5€/tCO2 in mid-2013. The sharp and persistent price decline has sparked intense debates both in academia and among policy-makers about the decisive allowance price...

This paper uses transaction and index data to empirically examine price formation in, and equilibrium characteristics of, the primary CDM market. Results point to the preemptive behaviour among intermediaries (carbon firms), and inefficiencies in information transmission between secondary and...

Discussions over tropical deforestation are currently at the forefront of climate change policy negotiations at national, regional, and international levels. This paper analyzes the effects of linking Reduced Emissions from Deforestation and Forest Degradation (REDD) to a global market for...

While emissions trading schemes are developed by nations to mitigate their greenhouse gas emissions, behavioural studies have shown that the political and public acceptability of these market-based instruments depends on the way the associated revenues are used. One option the general public...

Companies in various industries are under growing pressure to assess the costs of decarbonizing their operations. This paper develops a generic abatement cost concept to identify the cost-efficient combination of technological and operational changes firms would need to implement to drastically...

Designing auctions that favor low resource quality installations allows countries to geographically diversify their renewable energy production, while lowering payments to low-cost producers. In this paper, we develop a stylized model showing that a discriminatory auction design favoring...

This paper addresses the economic impact of the carbon allowance market in the European Emission Trading Scheme (ETS) on the futures market of electricity, gas, and coal. Our findings seem to confirm that, as expected, electricity returns are positively affected by carbon allowances, coal, and...