Regulating an Externality-Generating Utility Environmental Taxes Under Limited Information

Henry van Egteren ()

Environmental & Resource Economics, 2002, vol. 21, issue 2, 107-133

Abstract: Global warming is currently an important item on most nationalenvironmental agendas. In many countries, coal-fired electricity generatingstations represent an important source of greenhouse gases. We examinehow regulations to curb emissions affect public utility pricing regulationwhen regulators act non-cooperatively. We show that, when there is limitedinformation on fixed abatement costs, an environmental regulator prefersan emission tax over an output tax or a lump sum environmental tax. Thepublic utility regulator prefers the lump sum tax regime. Copyright Kluwer Academic Publishers 2002

Keywords: adverse selection; electricity pricing; environmental taxes (search for similar items in EconPapers)
Date: 2002
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DOI: 10.1023/A:1014521221896

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