Technical Synergies and Trade-Offs Between Abatement of Global and Local Air Pollution

Jorge Bonilla Londoño, Jessica Coria and Thomas Sterner

Environmental & Resource Economics, 2018, vol. 70, issue 1, No 9, 221 pages

Abstract: Abstract In this paper, we explore the synergies and tradeoffs between abatement of global and local pollution. We build a unique dataset of Swedish combined heat and power plants with detailed boiler-level data 2001–2009 on not only production and inputs but also on emissions of $$\hbox {CO}_{2}$$ CO 2 and $$\hbox {NO}_{\mathrm{x}}$$ NO x . Both pollutants are regulated by strict policies in Sweden. $$\hbox {CO}_{2}$$ CO 2 is subject to the European Union Emission Trading Scheme and Swedish carbon taxes; $$\hbox {NO}_{\mathrm{x}}$$ NO x —as a precursor of acid rain and eutrophication—is regulated by a heavy fee. Using a quadratic directional output distance function, we characterize changes in technical efficiency as well as patterns of substitutability in response to the policies mentioned. The fact that generating units face a trade-off between the pollutants indicates the need for policy coordination.

Keywords: Environmental policies; Shadow pricing; Directional distance function; Climate change; Local pollution; Policy interactions (search for similar items in EconPapers)
JEL-codes: H23 L51 L94 L98 Q48 (search for similar items in EconPapers)
Date: 2018
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Citations: View citations in EconPapers (5)

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DOI: 10.1007/s10640-017-0117-8

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