Do national-level policies to promote low-carbon technology deployment pay off for the investor countries?

Gokul C. Iyer, Leon E. Clarke, James A. Edmonds and Nathan E. Hultman

Energy Policy, 2016, vol. 98, issue C, 400-411

Abstract: National-level policies to promote deployment of low-carbon technologies have been suggested and used as a means to reduce greenhouse gas emissions in the context of international climate change mitigation. The long-term benefits of such policies in the context of international climate change mitigation depend on their effects on near-term emissions abatement and resultant long-term technological change that will reduce abatement costs of achieving global mitigation goals. There is also an argument that these policies might foster early-mover advantages in international low-carbon technology markets. We first review the factors that could influence such benefits and use a global integrated assessment model to present an illustrative example to understand the potential magnitude of these benefits. We find that reductions in long-term abatement costs might not provide sufficient incentives to justify policies to promote the deployment of low-carbon technologies, in particular, the emerging, higher-risk, and currently expensive alternatives. We also find that early-mover advantages can potentially provide substantial benefits, but only if these advantages are both strong and persistent. Our results suggest a role for international cooperation in low-carbon technology deployment to address the existence of free-riding opportunities in the context of global climate change mitigation.

Keywords: Technological change; Integrated assessment model; Climate change; Green; Low carbon; Spillover (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:enepol:v:98:y:2016:i:c:p:400-411

DOI: 10.1016/j.enpol.2016.08.017

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