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A Sketch of Bolivia’s Potential Low-Carbon Power System Configurations. The Case of Applying Carbon Taxation and Lowering Financing Costs

Jenny Gabriela Peña Balderrama (), Thomas Alfstad (), Constantinos Taliotis (), Mohammad Reza Hesamzadeh () and Mark Howells ()
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Jenny Gabriela Peña Balderrama: Division of Energy Systems Analysis, Department of Energy Technology, KTH Royal Institute of Technology, 114 28 Stockholm, Sweden
Thomas Alfstad: United Nations Division of Social and Economic Affairs, New York, NY 10001, USA
Constantinos Taliotis: The Cyprus Institute, 2121 Nicosia, Cyprus
Mohammad Reza Hesamzadeh: Department of Electric Power and Energy Systems, KTH Royal Institute of Technology, 111 21 Stockholm, Sweden
Mark Howells: Division of Energy Systems Analysis, Department of Energy Technology, KTH Royal Institute of Technology, 114 28 Stockholm, Sweden

Energies, 2018, vol. 11, issue 10, 1-20

Abstract: This paper considers hypothetical options for the transformation of the Bolivian power generation system to one that emits less carbon dioxide. Specifically, it evaluates the influence of the weighted average cost of capital (WACC) on marginal abatement cost curves (MACC) when applying carbon taxation to the power sector. The study is illustrated with a bottom-up least-cost optimization model. Projections of key parameters influence the shape of MACCs and the underlying technology configurations. These are reported. Results from our study (and the set of assumptions on which they are based) are country-specific. Nonetheless, the methodology can be replicated to other case studies to provide insights into the role carbon taxes and lowering finance costs might play in reducing emissions.

Keywords: carbon tax; discount rate; carbon abatement costs; MACC; Bolivia; OSeMOSYS (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2018
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