EconPapers    
Economics at your fingertips  
 

Economics of Pricing the Cost of Carbon Dioxide Restrictions in the Production of Electricity

Dagobert Brito and Robert F. Curl

The Energy Journal, 2011, vol. Volume 32, issue Number 4, 1-26

Abstract: We calculate the cost of a carbon dioxide constraint in the production of electricity by modeling the replacement of coal generators with natural gas generators. We find: First, replacing coal generators with natural gas generators is the most economical way to reduce carbon dioxide emissions by 20 percent. Second, replacing existing coal generation capacity with modern coal generation plants can only reduce total carbon dioxide by 5 percent. Third, the distribution of the efficiency of coal generators in the United States restricts the range over which carbon dioxide prices effectively manage the displacement of coal by gas. Fourth, the narrow range for the price of carbon dioxide creates the possibility that a market in carbon dioxide permits will result in high volatility in the market for electricity. Fifth, the carbon prices implied by the transition from coal to gas will have very little impact on transportation fuels.

JEL-codes: F0 (search for similar items in EconPapers)
Date: 2011
References: Add references at CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://www.iaee.org/en/publications/ejarticle.aspx?id=2434 (text/html)
Access to full text is restricted to IAEE members and subscribers. bers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:aen:journl:32-4-a01

Ordering information: This journal article can be ordered from
http://www.iaee.org/en/publications/ejsearch.aspx

Access Statistics for this article

More articles in The Energy Journal from International Association for Energy Economics Contact information at EDIRC.
Bibliographic data for series maintained by David Williams ().

 
Page updated 2020-08-05
Handle: RePEc:aen:journl:32-4-a01